Market News

Market News - 26 February-4 March 2017

Indonesia Allocates Rp1.5 Billion for Fish Farming Insurance” - Antara News - 1 March 2017

The Indonesian Maritime Affairs and Fisheries Ministry has allocated Rp1.5 billion (US$112,000) for fish farming insurance program. The insurance will be used for protecting shrimp farming business from (losses due to) flood, tsunami, earthquake, and other natural disasters. The shrimp farmers who are eligible for the insurance should have at least 2 hectares of farms, he said adding that the insurance program would have been implemented in three provinces, including South and East Kalimantan. Other than implementing the insurance in 2017, the ministry has been prepared to revitalize 300 hectares of fish farming, develop 210 hectares of fish-rice farming, and 100 million of seeds. As well as building two feed factories, three offshore floated cages, and 200 units of self-contained feed.

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Gov't Boost Trade with France” - Tempo - 28 February 2017

Indonesian Foreign Affairs Minister Retno Marsudi met with French Foreign Affairs Minister Jean-Marc Ayrault to discuss endeavors strengthening economic ties between Indonesia and France.  Both countries discussed topics around economic cooperation, particularly those related to investment, trade, creative economy, access to Indonesia’s oil palm products, and Indonesia's FLEGT timber license. Both ministers also discussed ways to accelerate the finalization of the Comprehensive Economic Partnership Agreement (CEPA) between Indonesia and the EU. In 2016, France invested US$109 million for 424 projects in Indonesia.

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Indonesia and France Will Work Together to Develop New And Improved Energy Sector” - Kompas - 28 February 2017

Indonesian Minister of Energy and Minerals Ignasius Jonan has met with the French Foreign Minister, Jean Marc Ayrault. The meeting was to formalize the establishment of the French Renewable Energy Group (FREG), which will create opportunities for cooperation Renewable Energy sector (EBT) between France and Indonesia. The purpose of the establishment of FREG, to improve contract B to B (business to business) between Indonesia and France in particular for the renewable energy sector and to encourage the participation of French companies in the renewable energy project in Indonesia.

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Indonesian Govt Will Increase Rate of Palm Oil Export” - Kompas - 28 February 2017

Ministry of Commerce through the Directorate General of Export Development (PEN) to encourage an increase in non-oil exports. The government will work Trade Attahce, Indonesian Trade Promotion Center, and the representative office of Economy and Trade in Taiwan. Diplomatic strategy as part of palm oil export development efforts need to be strengthened because of the current issues and challenges faced by national oil sector is very complex. Based on the record of the Ministry of Trade, the value of Indonesia's palm oil trade is quite large. In 2016, the export value of crude palm oil (CPO) reached 16.29 billion US dollars.

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State Plantation Holding Company Books Rp 38b Profit” - The Jakarta Post - 27 February 2017

State-owned plantation holding company PT Perkebunan Nusantara III booked Rp 38 billion (US$2.85 million) in consolidated profit in January after suffering losses of Rp 264 billion in the same period last year. The profit particularly came from the production increase of palm oil from 108,276 tons to 132,615 tons in January, this year.The transformation program of the company would be accelerated this year, covering financial restructuring, downstream business development, etc.

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Minister Mentions Options for Freeport Share Divestment” - Antara News - 27 February 2017

Coordinating Minister for Maritime Affairs Luhut Binsar Panjaitan has mentioned a number of options related to the purchase of 10.46 percent of share divestment of PT Freeport Indonesia.Such as, state owned entreprises, which he will hold a meeting with on Monday evening. The ministry is focusing on establishing a state-owned mining holding company to which the governments 9.36 percent stake in Freeport will be transferred. PT Freeport Indonesia had halted its production activities with effect from Feb 10, 2017, following the governments decision to have greater control on raw mineral resources.  

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Full Support of Health Insurance for Foreign, Domestic Investors” - Tempo English - 27 February 2017

The Investment Coordinating Board (BKPM) gives its full support for the National Health Insurance program implemented by the Workers Social Security Agency (BPJS Ketenagakerjaan) by signing an MoU on Friday at Nusa Dua. Through the MoU, they are committed to give supports for implementation for both foreign and domestic investors.The cooperation is also the manifestation of the integrated of public service for the people and investors. 

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Market News - 19-25 February 2017

2017 Challenges and Prospects”  - 24 February 2017

Although currently in a global economic slowdown, the Indonesia government continues to develop products of local natural resources. The Indonesian economy grew 5.02% until the end of 2016. Although in Indonesia itself, several commodities experienced an inflation of prices that effects the stability of daily needs. The coordinating Minister stressed the fact of the need of new markets and products identification so Indonesia would not depend entirely to the main export commodity. 

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Early March: Minister of Energy and Minerals Promises to Lower Gas Prices in North Sumatra” - Kompas - 24 February 2017

North Sumatra Governor Erry Nuradi have declared that the Minister of Energy and Minerals has promised to lower industrial gas prices in early March. The prices  will go from USD 12,2/MMbtu to USD 9,9/MMbtu. High industrial gas prices becomes one of the main obstacles for investment and makes North Sumatra industry unable to compete. Therefore, the lowering of prices is like a breath of fresh air. The Indonesian will evaluate every six months following the global gas price.

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Govt Signs Guarantee Agreement for Four Toll Road Projects” - Tempo - 23 February 2017

The government has signed a guarantee agreement worth Rp37.2 trillion for four toll road projects. The toll road projects consist of Jakarta–Cikampek II Elevated, Krian–Legundi–Bunder-Manyar, Cileunyi-Sumedang-Dawuan (Cisumdawu), and Serang-Panimbang. The scope of work of the Finance Ministry in the projects includes political risk caused by regulatory changes. The Coordinating Minister for Economic Affairs Darmin Nasution expects the infrastructure project to boost the economy.

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Indonesia Ups Efforts to Gain EU Recognition for Palm Oil” - The Jakarta Post - 23 February 2017

Indonesia is stepping up its efforts to gain recognition from the European Union for a palm oil product certification amid an intense anti-palm oil campaign in Europe on the back of sustainability concerns.The government has issued its own national sustainability standards for palm oil, called Indonesian Sustainable Palm Oil (ISPO), which certifies legal compliance. However, five years into its implementation, it has failed to gain access to premium EU markets.Indonesia aimed to repeat the success of SVLK, which was approved by all 28 EU members for complying with the EU’s Forest Law Enforcement Governance and Trade (FLEGT).

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Finance Ministry Teams Up with Local Government to Boost Tax Fund” - CNN Indonesia - 22 February 2017

The Ministry of Finance (MOF) will strengthen cooperation with local governments (local government) to boost tax revenue. It is believed to be part of the tax reform. Tax reform should be accompanied by two keys, namely access to information and cooperation. Therefore, local government cooperation in providing access to information becomes important. Such as profile information on the taxpayer, hotel, or restaurant tax.Not only that, the Ministry of Finance is also considering to levy income tax taxpayers Micro, Small and Medium Enterprises (SMEs) in conjunction with traditional regional market tax payments. The Indonesian government is expecting tax revenues up to 18.34 percent than last year.

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Chairman of Chamber of Commerce Indonesia: Arbitration Should Be the Last Option” - Metro TV News - 22 February 2017

Freeport McMoran will arbitrate if after 120 days, have not reached common ground on the issues that occur with the Indonesian governmentm as stated in their working contract. Dispute resolution through arbitration path takes quite a long time, and it would require considerable expense. Other than a one sided change in the Working contract, is the extension of the working contract until 20141 which has been delayed till now. As well as the regulation of export tax. 

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Cayenne Peppers Price at IDR 130 in Pontianak” - Antara News - 21 February 2017

Cayenne prices in traditional markets in the city of Pontianak as in Pasar Flamboyan is still high at around Rp130 ​​thousand per kilogram because of limited stock. Meanwhile vegetables prices are still normal and that after 2 weeks, prices of chicken have normalized once more. With other commodities stabiling as well, such as sugar and scalliots. Vendors are unsure when the cayenne pepepper prices will return to normal.

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Market News - 12-18 February 2017

Export to China Surges” - Tempo - 17 February 2017

The Central Statistics Agency (BPS) said the national export market is changing. China is now Indonesia's largest export destination countries, taking over the United States' position. Exports to China totaled at US$1.55 billion (Rp20 trillion) which is about US$120 million higher compared to the export value to America. The Agency statistics also show that India's export has also soared to USD 1.32 billion. In addition that there ae some commodities and processed good to be improved such as fisheries, pal oil, rubber, and rattan. 

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Indonesia Seeks to Re-energize Trade with Saudi Arabia” - The Jakarta Post - 17 February 2017

President Joko “Jokowi” Widodo is seeking help from the Saudi Arabian Consultative Assembly to improve the slowing bilateral trade and economic cooperation between the Middle Eastern country and Indonesia. Although Indonesia contributes greatly to Saudi’s national income  trade and economic relations between the two countries are still weak. Bilateral trade and economic relations saw a significant drop of up to 36 percent in 2014 and 2015. The President had also asked the Majlis Asy-Syura to convince the Saudi government to materialize its investment plans and commitments in Indonesia.

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Depok: Price of Chili Peppers Keeps Soaring” - Kompas - 13 February 2017

The price of chilli peppers in Pasar Cisal, Depok keeps on rising. With IDR 160.000/kg, it went up around IDR 40.000, with last week at IDR 120.000/kg. With the consummers complaining on how high the price is, many vendors are confused on how to sell the much needed chilli peppers. The prices reaches an all time level high as this is the firsttime in 13 years that it price reach this high. Many hopes that the government can help with the inflation of pepper price as the quantity of sells drops 40% in these last few weeks. 

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