We Are Waiting for You to Invest in Indonesia, Jokowi Tells APEC in Speech

Jakarta Globe, Nov 11, 2014

President Joko Widodo delivers a speech at the APEC CEO Summit as part of the
 Asia-Pacific Economic Cooperation Summit at the China National Convention
Center in Beijing on Nov. 10, 2014. (AFP Photo/Pool/Andy Wong)

Jakarta. Indonesian President Joko Widodo addressed business leaders at the Asia-Pacific Economic Cooperation CEO summit in Beijing on Monday, where he put out a call for greater investment in the archipelago and promised a friendlier climate for doing business in the country.

The following is his speech:

Excellencies, distinguished guests, ladies and gentlemen and CEOs.

First, on behalf of Indonesian government and the people of Indonesia I would like to thank you for coming to my presentation. Today I am very happy to be among with you because you know I was a businessman years ago. So this morning I am very happy because we can talk about business, about investment with all of you.

This picture shows you our map of Indonesia. We have a population of 240 million and the distance is like from London in the UK to Istanbul in Turkey. And imagine, we have 17,000 islands.

Our national budget in 2015 is $167 billion and the fuel subsidy [allocation] is $27 billion. It’s huge. So we want to channel our fuel subsidy from consumption to productive activities. We want to channel [the money] to farmers for seed, for fertilizers, and also for irrigation. And we want to build dams — 25 dams in five years from our fuel subsidy to maintain the water supply to farming areas.

Some subsidy [funds] we want to channel to fishermen, to give them boat engines [and] refrigerators. We want to increase the income of the fishermen. Some fuel subsidy [funds] we want to [give to] micro and small enterprises in the villages. We want to help them raise working capital. And some subsidy [funds] we want to channel to the health program [and] the education program. And the subsidy [funds] we [also] want to channel to infrastructure.

In five years we want to build 24 seaports and deep seaports. We have 17,000 islands, so we need seaports and deep seaports. And this is your opportunity: 24 seaports and deep seaports.

This picture shows our Jakarta port, Tanjung Priok Port. In 2009, the capacity was 3.6 million TEUs a year. And our plan in 2017 is around 15 million TEUs a year. This is the potential [for] ports in Indonesia. This is your opportunity. We want to build in Sumatra, Kalimantan, Java, Sulawesi, Maluku, also in Papua. And we plan to build our [railway network]. We already [have railway lines] in Java and we want to build in Sumatra, Kalimantan, Sulawesi and Papua. This is your opportunity.

Now we talk about mass transportation. We want to build mass transportation in six big cities in Indonesia. We started in Jakarta last year, and we want to build in Medan, Makassar, Semarang, Bandung [and] Surabaya. So, this is also your opportunity. Because you know our national budget is limited.

Now we [will] talk [about] our maritime agenda. We want to build [a] sea toll. What is [a] sea toll? [A] Sea toll is [a] maritime transportation system to make our transportation costs lower [and] more efficient. We want to build from the west to the east. We hope not only the vessels can enter our sea toll but also mother vessels can enter the sea toll. So the price, the cost of the transportation, [becomes] more efficient.

For example, the price of [...] one sack [of] cement in Java is $6 [...] But in Papua the price is $150 [...] Imagine, 25 times [as much]. So we hope with our sea toll the price in our islands [will be] the same.

Electricity. We need power plants. We need around 35,000 [megawatts] to build our industries, projects, industrial zones, [manufacturing] zones. So we need power plants. This is also your opportunity to invest in this project. Because we need our power plants for manufacturing, for industrial zones.

Many investors, a lot of investors, when they come to me most of them [...] always complain about land acquisition. I will push my ministers, my governors, my mayors to help clear this problem. I have experience with land acquisition when I was a governor. We [had the] Jakarta Outer Ring Road [project that] started 15 years ago but stopped eight years ago, because we had a problem. One point five kilometers [was] unfinished because there [were] 143 families [who did] not accept [...] the compensation price. So last year I invited them [...] to lunch and dinner. Four times. Ah, this is me. I invited them and then we talked about the problem. Four times. And the problem [was] cleared.

And now the toll road has been [in use since] seven months ago.

Now [let’s] talk business permits. We have a national one-stop service office that can help you, that will serve you, that will facilitate you, that will give you your business permit. For example, [a] principle business permit [will take] three days to process.

Finally, again on behalf of the Indonesian government and the people of Indonesia I would like to thank you for your listening my presentation. We are waiting for you to come to Indonesia. We are waiting for you to invest in Indonesia. Thank you.

Related Articles:

Jokowi Tells Obama He’ll Keep Fighting Terrorism
Jokowi, Xi Push Bilateral Relations Forward at APEC Meeting

Indonesia to Offer PPP Projects Worth $52b

Jakarta to Start With Ambitious $34b Giant Sea Wall Project

Draft of the Master Plan for National Capital Integrated Coastal Development. 
(JG Screen Grab courtesy of the website of the Coordinating Ministry of
Economic Affairs)

Indonesia to Offer PPP Projects Worth $52b

Jakarta Globe, Eko Adityo Nugroho, Nov 06, 2014

Jakarta's government has set the capital's Decent Living Index at Rp 2.5 million
 ($206) for 2015, a strong signal to workers that minimum wages are unlikely
to increase substantially. (Reuters Photo/Beawiharta)

Jakarta. The Indonesian government plans to offer 43 infrastructure projects worth $52 billion to private investors next year, according to an official of the National Development Planning Ministry.

Bastari Panji Indra, a director at the ministry, said the projects will be offered under public-private partnership (PPP) schemes.

The projects offered include airports, monorail and, light rail transits, toll roads, coal transportation trains, ports, and water supply.

The government has published details regarding the projects in the Public Private Partnership Book 2015, which guides infrastructure development in the country.

Speaking on the sideline of Indonesia Infrastructure Week late on Wednesday, Bastari said of the 43 projects, eight are classified as “ready” to be offered, 11 are   “prospective” and 24 are marked as “potential.”

Bastari said the government will offer 10 major airport projects to private investors, including Juwata in North Kalimantan, Tjilik Riwut in Central Kalimantan and Fatmawati Soekarno in Bengkulu.

“Apart from airports, there are also a monorail project, coal transportation by train, water supply and six ports,” Bastari said.

Citing the Public Private Partnership Book 2015, he said the government plans to build an express train line connecting the Halim Perdanakusuma Airport in East Jakarta to the Soekarno-Hatta International Airport in Tangerang, Banten, in order to ease passenger commuting.

The director also announced a light rail transit system in Bandung, West Java, new train networks for South Sumatra, three water supply projects in Semarang, Central Java; Pekanbaru in Riau, and Pondok Gede in Bekasi.

Bastari also flagged a project for waste disposal processing in Bogor and Depok.

Deputy Minister Dedy Supriadi Priatna, who is charged with infrastructure affairs, said the government plans to revise the PPP scheme to attract investors, including with the introduction of a performance-based annuity scheme.

Under such a scheme, private investors contribute to development, financing and the operation of a project with a given concession time.

Once the project is open for commercial use, investors will receive regular payments for providing the service to the public, with a performance standard agreed to by both parties.

The new government under President Joko Widodo has a lot of research to do into the infrastructure sector.

Poor road and toll road conditions, over-crowded airports, over-capacity ports, and a lack of train networks have been cited as the main stumbling blocks to strong and sustained economic growth.

The previous administration under Susilo Bambang Yudhoyono repeatedly offered infrastructure projects to tender, but only a few have been completed.

Poor preparation of projects, complex bureaucracy and low return in investment for the private sector remain major factors that deter investor interest.

ADB Supports Renewable Energy by Investing in Indonesian Geothermal Plant

ADB, 31 March 2014

MANILA, PHILIPPINES – The Asian Development Bank (ADB) has signed a $350 million financing package supporting the construction of the 320 megawatt Sarulla Geothermal Power Development Project in North Sumatra, Indonesia, an investment expected to unlock clean energy investments across the country, which holds 40% of the world’s geothermal resources.

The renewable energy project will provide clean, baseload power to an Indonesian grid currently dominated by aging coal and oil-fired power plants. It is expected to reduce 1.3 million tons of carbon dioxide emissions per year upon completion, which is estimated to be in 2018.

“Geothermal power taps into an abundant indigenous resource in Indonesia that can provide a more sustainable and secure form of clean energy while significantly lowering carbon emissions,” said Jackie B. Surtani, Senior Investment Specialist in ADB’s Private Sector Operations Department.

Indonesia currently uses coal and oil to produce 65% of its electricity and fuel its economic growth. The country has vowed to increase the share of renewable energy in its primary energy supply from 5% in 2010 to 25% by 2025, and reduce greenhouse gas emissions by 26% by 2020. Geothermal plants typically produce less than 10% of the greenhouse gas emitted by fossil-fuelled thermal plants.

Under the loan package, ADB will provide $250 million from its ordinary capital resources, $80 million from the ADB Clean Technology Fund (CTF), and $20 million from the Canadian Climate Fund for Private Sector in Asia (funded by the Government of Canada) under the Clean Energy Financing Partnership Facility. The project represents the first deployment by ADB of the Canadian Climate Fund and the first disbursal of CTF funds by ADB in Indonesia.

ADB’s climate finance capabilities were instrumental in establishing the first commercially financed, utility-scale geothermal independent power plant project in Indonesia in more than a decade. The climate funds were structured as an innovative loan tranche that bridged the financing gap between banks and investors to maintain financial viability of the project.

The project sponsors are Itochu Corporation, Kyushu Electric Power Company, Ormat International, and Medco Power Indonesia.

Six commercial banks – Bank of  Tokyo-Mitsubishi UFJ, ING Bank, Mizuho Bank, National Australia Bank, Société Générale, and Sumitomo Mitsui Banking Corporation – will also co-finance the total $1.17 billion loan package, which ADB and Japan Bank for International Cooperation (JBIC) acted as Lead Structuring Banks.

The project will be developed and implemented under a 30-year energy sales contract with Perusahaan Listrik Negara, the national electricity utility company, a 30-year joint operating contract with Pertamina Geothermal Energy, and a 20-year guarantee from the Ministry of Finance.

Activists Rally Against Nuclear Power in Blackout-Prone Indonesia

Plans to construct a nuclear power plant in Indonesia have received global attention as anti-nuke activists from Japan meet with local campaigners

Jakarta Globe,  Cory Rogers, Mar 11, 2014

The installation of a nuclear research reactor at an operation hall of the
 National Nuclear Energy Agency (Batan) complex in Serpong on April 23,
2013. (AFP Photo)

Yogyakarta/Jakarta. A government-backed plan to construct nuclear power plants in Indonesia has been met with backlash by several local groups in the archipelago, highlighting the tensions nuclear power projects face in a post-Fukushima world.

Recently announced plans to make the West Java district of Subang the site of Indonesia’s fourth nuclear reactor has pushed a decades-long conflict back into the spotlight, pitting those who view the establishment of nuclear power plants as a valuable addition to Indonesia’s energy portfolio against others who say the social and environmental risks of radioactive contamination outweigh the potential benefit.

Critics point out that Indonesia’s geologic position atop the “Ring of Fire” makes it particularly vulnerable to earthquakes and volcanic eruptions — events that drastically increase the odds of a nuclear tragedy. These concerns are augmented by fears that rampant corruption and graft will undermine the government’s ability to implement and then manage costly safety protocols.

In January, Japanese representatives from No Nukes Asia Actions (NNAA), a Tokyo-based anti-nuclear coalition, gathered with Indonesian activists in Balong, Central Java, to discuss resistance strategies and the prospects of an international partnership to thwart the prospect of nuclear power in Indonesia.

“With Fukushima, the whole world witnessed the terrible effects of nuclear disaster,” NNAA rep Seung Choo told some 200 residents in Balong over two days of talks. “Now, we must say no more nuclear plants — not here in Indonesia or anywhere else.”

Balong provided a fitting backdrop to the event: in 2007, growing fears over a proposed nuclear power plant cohered into an alliance of local residents, business owners, religious groups and students that eventually thwarted government plans to break ground in 2014.

In 2007, the Jepara branch of Nahdatul Ulama (NU), Indonesia’s largest Muslim organization, even issued a fatwa against the proposed plant, drawing the ire of state officials who had been courting the group for support.

But nuclear plans in Indonesia have been on the table for a large chunk of the nation’s modern history.

Nuclear power plays

The National Nuclear Energy Agency (Batan), created by former President Sukarno in 1964, has been Indonesia’s most strident nuclear energy advocate. The organization has aired hopes to establish three fully operational nuclear power plants in the country by 2025, a plan that has been embraced as part of Indonesia’s Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development (MP3EI).

Batan spokesman Eko Madi Parmanto says claims of public resistance to nuclear power have been greatly exaggerated in Indonesia.

“We’ve periodically conducted surveys to measure people’s acceptance of the nuclear plant plan,” Eko told the Jakarta Globe last week. “The latest national survey in 2013 indicates that 67.6 percent of respondents support the plan.”

The agency views nuclear energy as an alternative to Indonesia’s addiction to unsustainable fossil fuels that pollute the environment and contribute to climate change. Indonesia has a wealth of potential in safe, renewable energy sources such as solar, hydro and geothermal, but oil, coal and natural gas still provide more than over 80 percent of the nation’s power. Only 12 percent of the country’s energy is provided by renewable sources.

In geothermal power alone, Indonesia is operating at a mere 4.2 percent of its potential output, despite sitting astride 40 percent of the world’s geothermal resources.

Oil, which accounts for about 30 percent of the country’s current energy supply, is now mostly imported, leaving the country vulnerable to unhedged price volatility together with currency fluctuations. In addition, oil — along with coal and natural gas — powers an electrical grid still suffering from chronic energy shortages throughout the country. Millions of poor, rural Indonesians, especially in eastern Indonesia, remain without electricity, and struggles to meet existing electricity needs are made worse by an 8 percent annual rise in demand.

The situation requires huge government subsidies in fuel and electricity just to keep up, consuming 41 percent of all government expenditures; more than what is budgeted for education, environmental protection, health, and housing combined. In 2013, some 13 percent of the nation’s subsidized fuel was used at power plants, according to government agency data.

According to Batan, nuclear power plants would play only a minor role in addressing these multi-pronged energy woes, adding just 5 percent to Indonesia’s total energy production if the government’s 2025 energy diversification goals were met.

Gus Nung presents in front of the Japanese representatives of No Nukes
Asia Actions (NNAA) on January 12, 2014. (JG Photo/Cory Rogers)

Resistance to Batan-led advocacy

At the local level, Batan has drawn criticism for its attempts to win support among populations living near proposed plants, which over the years have included sites in Balong, Bangka-Belitung, Kalimantan and Madura.

The promotional efforts carried out by Batan were key in galvanizing opposition to the proposed plant back in the mid 2000s, said Daviq, the secretary of the Balong Community Union (PMB), a local anti-nuclear energy group.

That advocacy campaign, which called for annual outlays of $2.5 million to fund scholarship programs, social events and a host of other activities, highlighted the benefits of nuclear power while, according to Daviq, making scant mention of its risks. When public queries about the program failed to produce useful information, many grew skeptical of the plan.

“We finally made the decision that OK, if the government is not willing to give the information to us, then we must seek it for ourselves,” he said.

Iwan Kurniawan, a lecturer at the Jakarta-based Institute of Archipelago Business, recalled similar transparency concerns at play in Madura, East Java, where in 2003 Batan was busy promoting another nuclear plant. Formerly a nuclear physicist with Batan who left the agency over an undisclosed dispute, Iwan said that in order to assuage safety concerns voiced by locals, Batan made spurious claims regarding its capacity to install the latest and safest model plant in Madura.

“The kind of plant being discussed was still in its research phase in South Korea,” Iwan said, explaining that such a plant could not be promised. He added that localities targeted by Batan-led nuclear advocacy were frequently vulnerable to this kind of misinformation.

“When Batan comes and discusses the benefits, I come and discuss the risks to create a more balanced perspective,” he said.

As in Balong, once the risks of nuclear contamination became apparent, public opposition stymied construction of the proposed plant in Madura. Activists argued that given the amount of untapped alternative energy sources that existed, the risks of nuclear disaster were avoidable and unjustifiable.

The nation’s nuclear power agency denied the allegations, explaining that Batan attempts to inform the public about leakage, natural disaster, and operators’ negligence risks as well as detailed information on how plant operators would ensure safety.

“We’ve also developed an information system on our website, and people can ask us via email about this safety technology,” Eko said.

Socialization campaigns remain crucial to successful implementation at proposed sites “only if the government has seriously designed the nuclear power plant program,” Eko explained.

“There are currently no plans for research at other locations,” he said.

The global business of nuclear power

If domestic resistance to nuclear power has hinged on countering Batan’s campaigns, the international strategy advocated by the NNAA seeks to shed a critical light on the corporate interests driving nuclear energy.

According to NNAA representative Seung Choo, business-friendly regulations in Japan that reallocate risk to nuclear operators encourage investment by companies like Toshiba, GE and Hitachi — the companies that build the plants. Japan’s 1961 Act of Compensation for Nuclear Damages mandates that the nuclear power operators, as opposed to the suppliers, assume exclusive accountability for any nuclear damage caused by an accident, making taxpayers ultimately responsible for damages.

This creates what Seung Choo calls a “crisis of liability,” where corporations that stand to profit from construction have less incentive to prioritize safety.

These laws work to promote “the sound development of the nuclear industry,” the NNAA said in a statement, and the group fears such business-friendly regulations will be replicated elsewhere as nuclear suppliers seek to access markets like Indonesia.

According to Indonesia’s 1997 Nuclear Power Act, if the country were to successfully establish a nuclear power plant, the suppliers would be responsible for up to Rp 900 billion ($76 million) in damages to be doled out over a maximum period of 30 years, regardless of the actual cost of damages.

Recent studies have shown that radiation-induced cancer can take as long as 40 years to develop, and the financial recovery of the Fukushima Daiichi Nuclear Power Plant disaster will approach $250 billion dollars.

Attempts to contact the Ministry of State-Owned Enterprises for clarification on current regulations were unsuccessful.

In response to the situation in Japan, where the corporate builders of nuclear power plants are shielded from restitution, the NNAA is challenging whether the 1961 act in court was constitutional.

Armed with 22 lawyers, their recently filed suit seeks redress for Japanese victims, and to inspire citizens in other nations to “abolish special legal provisions that protect nuke businesses all around the world,” the group said in a statement.

The suit seeks 10,000 plaintiffs worldwide to sign over power of attorney so that the NNAA can represent them in court. “Anyone can be a plaintiff,” Choo said. “Even someone traumatized by the media coverage qualifies as a victim.” If the NNAA wins, these foreign plaintiffs will receive a symbolic, one-dollar payout.

In Balong, the NNAA made hundreds of documents available for signing. Many, including Nuruddin Amin, the head of the Hasyim Asy’ari Pesantren (Islamic boarding school) in Bangsri, Central Java, and a longtime supporter of the anti-nuclear cause, expressed enthusiasm for the strategy.

“The Fukushima accident is not only a tragedy for the Japanese,” Nuruddin said. “It is a tragedy for the whole world, and I hope we all will join to sign this power of attorney so that we can work on this issue together.”

Many Indonesian activists, however, remained mindful that the first battle remains on the home front, helping provide balanced information to communities earmarked for nuclear power plant development.

For Iwan, the resistance coalitions that fought a successful battle in Balong ought to provide guidance and direction as the drive for domestic nuclear power progresses.

“Here we have a model of resistance that can be delivered elsewhere,” he said.

— Erwida Maulia contributed to this report in Jakarta

Women shout slogans in front of the National Diet in Tokyo

on March 9, 2014 as they take part in a rally denouncing nuclear

power plants (AFP, Toru Yamanaka)

Related Articles:

Anti-nuclear rally in Tokyo draws tens of thousands

Anti-nuclear protests in Taiwan draw tens of thousands

Japan prepares to mark three years since devastating quake

Islanders afraid to go home 60 years after Bikini Atoll H-bomb

"Fast-Tracking" - Feb 8, 2014 (Kryon Channelling by Lee Carroll) - New (Reference to Fukushima / H-bomb nuclear pollution  > 20 Min)