Blame game begins over KPU graft caseTuesday, 14 Jan 2020
GENERAL NEWS AND HEADLINES
Blame game begins over KPU graft case
The Jakarta Post, p.1
In the wake of a bribery case involving some of its members, the Indonesian Democratic Party of Struggle (PDI-P) seems to be trying to distance itself from its secretary-general, Hasto Kristiyanto, while declining to help search for the case’s main suspect: PDI-P politician Harun Masiku.
Ahmad Basarah, one of the party's central executive board heads, said on Monday that Hasto was the one who knew why the PDI-P wanted Harun to have a seat in the House of Representatives. Basarah added that the decision was based on the party's "subjectivity" and that it was a "secret" that should not be disclosed to the public.
In contrast to Basarah, another party executive board head named Djarot Saiful Hidayat appears to be shielding Hasto. He said he believed that Hasto had been framed and said that Hasto did not have aides named Saeful and Donny, who funneled the bribe for Harun.
When asked about Saeful and Donny's presence in various PDI-P activities and at its headquarters, Djarot said, "A party headquarters is a public place. Anyone can enter the building." Djarot added that the party would not cooperate with the KPK to search for Harun, calling on him to surrender.
KPK to ask Interpol’s help
Media Indonesia, headline; Kompas, p.1
The Corruption Eradication Commission (KPK) is seeking Interpol’s assistance through the National Police in locating Indonesian Democratic Party of Struggle (PDI-P) politician Harun Masiku. Harun, who was entangled in a bribery case involving General Election Commission (KPU) commissioner Wahyu Setiawan, reportedly fled to Singapore.
Spokesman for the Immigration Directorate General Arvin Gumilang confirmed Harun passed an immigration gate as he left the country for Singapore on Jan. 6.
KPK deputy chairman Nurul Ghufron said on Monday the antigraft body would immediately ask the National Police to seek the NCB-Interpol’s (National Central Bureau) help.
International Law lectures Hikmahanto Juwana of the University of Indonesia said that, through cooperation with NCB-Interpol, a red notice can be issued to facilitate Harun’s arrest
Plaintiffs struggle to obtain evidence in attempt to challenge revised KPK Law
The Jakarta Post, p.4
Lawyers representing a coalition of civil society groups that are challenging the controversial 2019 Corruption Eradication Commission (KPK) Law have complained about difficulties in securing evidence to support their petition for a judicial review of the recently enacted law.
The plaintiffs, who aimed to challenge the revised version of the 2002 KPK Law at the Constitutional Court, said they were unable to provide evidence as requested by the court’s judges during a hearing on Wednesday because they did not have access to the necessary documents, said Viola Reinida, one of the lawyers.
She said the lawyers had asked the House of Representatives for documents on the deliberation between lawmakers and government representatives of the law revision but instead were told by the House Information and Documentation Management Division (PPID) that the evidence was for internal documentation only and not for publication.
Muhammad Isnur, another lawyer representing the coalition, accused both the government and legislative body of being uncooperative during the deliberation period for the revised law.
Political parties map power in regions
Nearing the 2020 simultaneous regional elections, political parties in Indonesia have started to map their strengths. A number of political parties, which on paper can nominate regional head candidates by themselves, have reportedly chosen to form coalitions. The move is feared to result in the phenomenon of uncontested candidates.
Kompas research center found that the Indonesian Democratic Party of Struggle (PDI-P) can nominate regional head candidates without having to form a coalition in 85 out of 270 regions that will hold elections in September. PDI-P deputy secretary general Arif Wibowo said the party was upbeat about its chances of winning in 44 of the regions based on its calculation.
Association for Elections and Democracy (Perludem) director Titi Anggraini said political parties appeared to be more pragmatic and opted to work with other parties to ensure the victory.
Prabowo, Parly discuss defense industry cooperation
The Indonesian and French governments will strengthen cooperation in a number of sectors, including the defense industry and counterterrorism. “Indonesia wants to increase defense cooperation, particularly to strengthen the Indonesian Military’s Alutsista [primary weaponry system],” said Defense Minister Prabowo Subianto in a written statement following his meeting with his counterpart Florence Parly at the latter’s office in Paris on Monday.
During the meeting, the two ministers agreed to sign a defense cooperation treaty later this year.
BUSINESS AND ECONOMICS NEWS AND HEADLINES
Jokowi signs landmark $22.8b deal with UAE
The Jakarta Post, headline; Bisnis Indonesia, headline
The United Arab Emirates (UAE) will provide Indonesia with one third of a US$22.8 billion development fund as Southeast Asia’s largest economy looks to the world’s wealthiest countries to invest in infrastructure and human capital development projects.
The investment plan was announced during President Joko “Jokowi” Widodo’s official two-day trip to Abu Dhabi that ended on Monday. Foreign Minister Retno LP Marsudi said that under the deal, the UAE would invest $6.8 billion in five government-to-government projects and 11 business-to-business projects in agriculture, education, energy and mining, among other sectors.
The UAE, Indonesia’s largest Middle Eastern investor last year, adds to a list of countries, including Japan, China and the United States, that the Jokowi administration is approaching to secure $137 billion for infrastructure projects, most of which are energy-related.
Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan said the UAE would also invest in Indonesia’s new capital city and the upcoming sovereign wealth fund (SWF), which is currently being developed by the State-Owned Enterprises Ministry.
“Those who will join the SWF include the UAE, Softbank, the IDFC [International Development Finance Corporation] from the United States and other parties that may want to join,” he said.
House plans to form Jiwasraya special committee receives mixed reaction
Observers and some victims of state-owned insurance company Jiwasraya’s financial fiasco have asked the House of Representatives to cancel a plan to form a special committee to further investigate the case.
They expressed their concern that the special committee would not resolve the issue or find a way to return the trillions of rupiah to Jiwasraya’s policy holders but instead use it as a political commodity.
Indonesian Consumers Foundation (YLKI) committee head Agus Suyanto said if the House’s special committee proposed for a government bailout to save the insurance company, it would only end up like the Century Bank bailout case, in which customers did not receive their money and the issue disappeared.
Seven House factions, except the Indonesian Democratic Party of Struggle (PDI-P) and Golkar, supported the establishment of the special committee in investigating the root of the problem in the Jiwasraya’s financial fiasco.
The PDI- and Golkar instead prefer the establishment of a working committee or a regular deliberation mechanism.
As a result, the proposal for forming the special committee has not been approved despite the fact that the PDI-P and Golkar account for only 46 percent of the House’s vote.
Bank Indonesia backs rupiah rally
Investor Daily, p.5; Kontan, p.1
Bank Indonesia (BI) has supported the rupiah’s rally in the past several days despite worries that a strong rupiah would make the country’s products less competitive.
BI sees the rupiah’s upward trend against the US dollar as normal because it matches the market’s strength and Indonesia’s economic fundamentals. Therefore, the central bank will not intervene.
BI Deputy Governor Dody Budi Waluto said on Monday that the strengthening of the rupiah was a normal phenomenon as it was still in line with Indonesia’s economic fundamentals. Therefore, the central bank will not consider an intervention to halt the rally, he added.
He said the rupiah gained significantly against the US dollar in recent days amid improvements in the country’s macroeconomic indicators, such as a relatively stable GDP growth, low inflation rate and stable consumer spending, an increase in foreign fund inflow and the country’s foreign reserves.
The rupiah further strengthened by 0.72 percent to 13,673 per dollar on the spot market on Monday, breaking its highest record since Feb. 22, 2018.
Bank Indonesia's middle rate of the rupiah also rose by 0.75 percent to 13,708 per US dollar. This is the highest BI rate since Mar. 28, 2018. The rupiah has been a top gainer in the Asian currency market since early this month, with a 1.41 percent increase.
SOE Ministry to replace Asabri board of directors this year
Bisnis Indonesia, p.4
State-Owned Enterprises (SOEs) has promised to overhaul the board of directors of the Indonesian Military-linked insurance company Asabri following the worsening of the company’s financial condition.
SOE Deputy Minister Kartika Wirjoatmodjo said in Jakarta on Monday that the mismanagement in the company’s investment had led to the decline in the value of its stock investment by as high as 90 percent last year.
Tiko did not disclose how much Asabri had lost, revealing only that the loss was caused by pump-and-dump stock market manipulation, which have caused a major fluctuation in Asabri's investment portfolio.
Based on Central Securities Depository (KSEI) data at the end of 2018, Asabri invested in shares in 13 listed companies with a total investment value of Rp 12.41 trillion (US$908 million).
However, at the end of 2019, the total investment, including another Rp 234.12 billion in shares of PT Hanson International (MYRX), fell to only Rp 2.18 trillion.
Ministry suggests DMO to lower gas prices
The Jakarta Post, p.8
The Energy and Mineral Resources Ministry has chosen to pursue a combination of a domestic market obligation (DMO) and fiscal incentives to reduce industrial gas prices in the hope of fulfilling a 4-year-old promise from President Joko “Jokowi” Widodo.
The ministry will, among others, expect oil and gas companies to prioritize selling their liquefied natural gas (LNG) to state-owned gas distributor PGN as part of efforts to bring the gas price down to US$6 per million British thermal units (mmbtu) as promised by the government, from between $8 and $9 per mmbtu at present.
“As long as PGN’s infrastructure runs at full capacity, it can sell at $6 per mmbtu,” said the ministry’s acting oil and gas director general, Djoko Siswanto, on Jan. 8.
Should PGN fail to bring gas prices down even with the larger LNG supply, then the government will reduce upstream costs — that average $5.4 mmbtu nationwide — by slashing nontax state revenue (PNBP) from oil and gas companies, he added.Download PDF