Siam Cement Eyes $1.1 Billion in Indonesian Acquisitions

Jakarta Globe, August 30, 2011

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Bangkok. Thailand's top industrial conglomerate, Siam Cement Pcl, will bid for two Indonesian petrochemical assets worth an estimated $1.1 billion, the company said on Tuesday, as part of a Southeast Asia expansion drive.

The deals are set to be another indication of increasing foreign interest in Southeast Asia's biggest economy, which is attracting investors because of strong economic growth and a buoyant stock market.

Siam Cement, 30-percent owned by the Thai royal family's Crown Property Bureau, said it was interested in PT Sulfindo Adiusaha, an Indonesian chemical producer controlled by Indonesia's Tanojo family.

South Korea's Hanwha Chemical Corp may also bid for Sulfindo Adiusaha, sources with knowledge of the deal said recently.

Sulfindo's owners, the Tanojo-controlled Victoria Group, are seeking to sell the whole company for about $700 million. Separately, Singapore state investor Temasek Holdings Pte Ltd is trying to sell its 23 percent stake in PT Chandra Asri Petrochemical Tbk in a deal worth an estimated $400 million, two sources with direct knowledge of the deal told Reuters recently.

"We are interested in both petrochemical firms in Indonesia...details of the deals cannot be disclosed at this point because they are quite big deals," Siam Cement Chief Executive Kan Trakulhoon told reporters on Tuesday.

Thailand's top energy firm, state-controlled PTT Pcl is also keen to buy a stake in Chandra Asri, an industry source said last week, possibly through its PTT Chemical Pcl unit.

Siam Cement and PTT group have aggressively scouted for opportunities for assets overseas, especially in Southeast Asia.

Reuters

China to Invest Rp 22t in W. Sulawesi: Governor

 Jakarta Globe, August 28, 2011

Mamuju, West Sulawesi. China plans to invest Rp 22 trillion ($2.57 billion) in a number of projects in West Sulawesi, Governor H. Anwar Adnan Saleh said. 

“Thank God, West Sulawesi is the only province in Indonesia to receive an investment of Rp 22 trillion from the Chinese government. In the not-so-distant future the investment will be realized. Hopefully, the investment will enable West Sulawesi to make progress and put it on par with other provinces,” he said on Saturday. 

Anwar, who was elected governor of the province in 2006, is seeking re-election in October.   

He said part of the investment would be used to build one of the biggest hydropower plants in Asia, which is expected to supply power to the entire island.

“The hydropower plant will be built in Bonehau sub-district, Mamuju district. The presence of this electrical energy source will be a special pride for the people of West Sulawesi because this region will be free from energy crisis,” he said.

Antara

Firm earmarks $655m to expand five airports

The Jakarta Post, Jakarta | Fri, 08/26/2011

State airport operator PT Angkasa Pura I (AP I) has allocated Rp 5.6 trillion (US$655.2 million) to expand five airports in Bali, East Kalimantan, East Java, Yogyakarta and South Kalimantan, the company’s spokesman said.

Company public relations manager, Merpin Butarbutar, said in Jakarta on Thursday that AP I would upgrade the five exports into world-class airports, with “airport city” concepts, equipped with hotels and shopping centers, by 2013.

“Almost all airports operated by AP I are currently over capacity. AP I will prioritize the expansion of passenger and logistic terminals to enhance our services as well as revenues,” Merpin said.

The five airports include the Ngurah Rai airport in Denpasar, Bali; Sepinggan International Airport in Balikpapan, East Kalimantan; Juanda International Airport in East Java and Adisutjipto International Airport in Yogyakarta.

In addition to the five airports, the company also operates another eight airports, most of which are located in eastern areas of Indonesia.

The total number of passengers at the 13 airports rose by an average of 11 percent, from 41 million in 2009 to 49 million in 2010, Merpin said.

He pointed out the Ngurah Rai airport in Bali served more than 11 million passengers in 2010, a figure far higher than the 7.5 million passengers the airport could ideally handle.

Ngurah Rai International Airport, which contributes the most to AP I’s revenues, is currently undergoing renovations to upgrade its capacity to be able to handle 25 million passengers a year, while expansion projects for the remaining four airports are expected to begin soon.

According to an earlier report, under the planned expansion, AP I will exchange the domestic and international terminals at Ngurah Rai airport in order to cope with an increase in international passengers.

The new international terminal will be expanded to cover an area of 120,000 square meters.

The company also plans to build a 39,000-square-meter, three-story car park, which will have room to accommodate up to 1,500 vehicles.

The Ngurah Rai airport expansion will use Rp 1.94 trillion of the total budget — the highest amount among the five airports — while the expansion of Sepinggan airport in Balikpapan will require Rp 1.56 trillion.

The company will use internal funds and bank loans to finance the projects, Merpin added.

As part of its expansion plans, he continued, AP I has established subsidiaries in four sectors: hotels, property, logistics and services, with a total investment of Rp 100 billion, to boost its non-aeronautical revenue.

“We expect the establishment of the new subsidiaries to boost the contribution of our ‘non-aero’ businesses to our total revenue to 60 percent by 2020, from 22 percent in 2010,” he said. AP I also recently launched its new logo in Bali, hoping to refresh its company’s image.

The new logo, worth more than Rp 200 million, depicts two hands of two different colors — green and blue — shaking each other, which “symbolize humane service, as well as safety and security, two key elements in the airport business,” Merpin said. (swd)

W. Sumatra to build 5 geothermal power plants

The Jakarta Post, Jakarta,  Fri, 08/26/2011

West Sumatra administration has announced plans to construct five geothermal power plants in its 2011-2015 development plan.

The construction projects would be fully financed by the central government, West Sumatra Governor Irwan Prayitno said Friday in Padang.

Irwan added that his administration planned to build one power plant every year so that the five plants would be ready by 2015.

The administration also plans to build another 25 biomass power plants that will utilize urban and rural waste for energy production.

Irwan said his administration planned to build the five biomass power plants gradually. The construction of these plants would also rely on funding from the central government, he said.

Meanwhile, the administration also plans to develop 3,000 small-sized solar plants and 10 micro-hydro power plants using funding from the state budget, over the same development period.

PLN to build hydropower plant in Wamena

The Jakarta Post, Jakarta | Wed, 08/17/2011

State electricity firm PT PLN has disclosed a plan to build a 50 megawatt hydropower plant (PLTA) in Wamena, Papua.

“Wamena is an ideal location for a PLTA. The city of Wamena is very big. On that basis, PLN will build PLTA Baliem 2,” PLN managing director Dahlan Iskan said on Tuesday evening as quoted by kompas.com.

Dahlan said the construction would start next year and was expected to be completed in five or six years.

He added that the project would cost Rp 3 trillion (US$351 million) in total, and that PLN would first use internal funds to finance the project before seeking third-party support.

Dahlan said PLN was planning to build another hydropower plant with the same capacity in Wamena after the completion of the first project.

General Motors to Invest $150m in Indonesia Plant

Jakarta Globe, August 12, 2011

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Detroit. General Motors Co said on Friday it will invest $150 million to reactivate a plant in Indonesia to build a “people mover” van for Southeast Asia.

The No. 1 U.S. automaker said the Bekasi plant in West Java, Indonesia, will begin production of the vehicle in 2013 and build 40,000 of the vans a year, ultimately creating more than 800 jobs.

GM, which said it will add new manufacturing equipment at the plant, did not disclose further details about the vehicle, including its name, design specifications or pricing.

GM said the Indonesia plant will mean an expansion of GM’s dealer network in that country and it will join with its Rayong, Thailand, and Hanoi plants to support growth in the region.

Last year, GM’s sales in Indonesia rose 72 percent to 4,500 vehicles. They were up 18 percent in the first six months of 2011.

Reuters

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City Administration to Turn Trash Into Power at Three New Facilities

Jakarta Globe, Dofa Fasila | August 11, 2011

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The Jakarta administration is planning to build three treatment centers that will use waste to generate energy, Governor Fauzi Bowo said on Wednesday.

“What we want is to turn waste to energy, and this process has already begun,” Fauzi said.

The Cakung Cilincing intermediate treatment facility in North Jakarta, which began operating on Aug. 1., uses mechanical and biological technology to recycle inorganic waste and to ferment organic waste to produce gas that can be used as fuel. After processing, the waste is then sent to a landfill.

The treatment center will be able to process 400 tons of waste daily until the end of the year and 600 tons daily from January. It will reach its full capacity of 1,300 tons in July next year, he said.

When running at full capacity, the Cakung Cilincing ITF will be able to produce 4.95 megawatts of electricity, or 445,669 million metric British thermal units of gas fuel.

Fauzi said that the two other intermediate treatment facilities, would be built in Sunter and Marunda, both in North Jakarta, before the end of the year.

The existing Sunter waste facility, which sits on five hectares of land, will be upgraded into an ITF, Fauzi said.

“We are going to enhance the technology at the Sunter processing station into an ITF,” Fauzi said. “The city sanitation office will cooperate with private sector companies interested in investing.”

The Sunter ITF, Fauzi said, would use technology based on an incinerator that would be capable of reducing the volume of waste by 90 percent, producing a large amount of electricity and significantly reducing greenhouse gas emissions.

Eko Bharuna, head of the Jakarta Sanitation Office, said the Sunter project would be tendered in September.

“We are involving the private sector under a build, own, operate and transfer arrangement,” Eko said. “We have chosen this option so as not to burden the regional budget.”

“Besides building the various intermediate waste processing facilities that are capable of handling large amounts of waste, the city administration will also develop reuse, reduce, and recycle centers [Sentra 3R] in Jakarta’s five municipalities,” Fauzi said.

“In the future, all regional developers will have to build their own waste processing facilities,” he added.

He said that several developers, including Pantai Indah Kapuk, had already agreed to build 3R centers in their estates. Pantai Kapuk Indah’s 3R center would use integrated dry anaerobic digestion and composting technology and would be built in cooperation with a private investor and the Tsu Chi Buddhist Foundation, he said.

“The waste at PIK will be processed into electricity and compost,” Fauzi said. “The main difference with the ITF is that the 3R center will have a much smaller capacity, of around 250 tons.”

Another 3R center planned for Pesanggrahan, South Jakarta, will be built with the assistance of the Public Works Office’s environmental sanitation unit, he said.

Fauzi added that the city administration would not go ahead with a plan to build an integrated waste processing plant in Ciangir, in Legok district, Tangerang. The decision came after Tangerang authorities zoned the Ciangir area for residential purposes.

The city had purchased an area of 96 hectares in Ciangir and an environmental impact study was conducted in 1999.

Fauzi said that while the Tangerang administration had proposed a land swap, suggesting an area in Jatiwangi, closer to Jakarta, the city authorities preferred to develop the Ciangir land into residential estate in line with the new zoning requirements.

With the Ciangir ITF center scrapped, he said, the city would now have to rely on the three planned ITFs.

“With these three ITFs and the Bantar Gebang landfill, Jakarta’s waste problem will be solved for the next decade, as their cumulative processing capacity will be more than 8,000 tons per day,” he said.

Operations Begin for New Bali Plant To Purify Sewage Into Usable Water

Jakarta Globe, Made Arya Kencana, August 11, 2011

Denpasar. Bali officially began operations at a water purification facility on Wednesday that turns treated sewage into clean, usable water.

“The Balinese people are worried about predictions that the island will suffer from a water crisis in 2015,” provincial regional secretary Made Jendra said at the plant’s opening. “This, at least, will be alleviated by the operation of this facility.”

Jendra said the treatment plant, which was a joint project of the central government, Denpasar administration, Badung district government and Japan International Cooperation Agency, would be able to produce 9,000 cubic meters of clean water every day, or more than 100 liters per second.

While that figure was far from the estimated 1,500 liters per second needed to avert a water crisis in 2015, he said clean water production would hopefully grow further with the completion of a sewage network project.

Goro Yasuda, director for overseas projects at Japan’s Ministry of Land, Infrastructure, Transportation and Tourism, said Bali would face a water crisis by 2015 because “the need for clean water vastly exceeds the capacity of the regional water company.”

Dewa Punia Asa, head of Bali’s public works office, said that so far only 8,647 households in Denpasar and Badung districts were linked to the first phase of the Denpasar Sewage Development Project. Those households are estimated to produce about 22,000 cubic meters of liquid waste a day.

A second phase, expected to be completed in 2014, is targeting 7,200 new connections, mostly hotels and restaurants in the tourist areas of Sanur, Kuta, Legian and Seminyak.

Tjok Bagus Budiana, who heads the province’s sewage management service, said the facility was designed to process as much as 51,000 cubic meters of liquid waste per day. It is built on a 17.5 hectare plot, 2.5 hectares of which is reserved for reservoirs to hold liquid waste.

He said households had to pay a monthly fee of Rp 15,000 to Rp 25,000 ($1.75 to $2.90) to be connected to the network. The fee, he added, would be higher for participating businesses.

Procter & Gamble to build first plant in Indonesia

Antara News, Wed, August 10 2011

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Jakarta (ANTARA News) - Procter & Gamble will invest up to US$100 million to build its first plant in Indonesia in Karawang, West Java, P&G Home Product Indonesia External Relations Manager, Junita Kartikasari said.

The fast moving consumer goods producing plant (PMCG) will be completed with modern facilities to produce baby diapers Pampers, she said.

She said it would be the first plant in Indonesia that will recieve a "Leadership in Energy and Environmental Design (LEED)" certificate.

LEED is a system of international certification issued by the US Environment-Friendly Construction Council.

The certificate is given to buildings that meet environmental criteria. P&G has earlier announced that all of its new facilities would be LEED-certified.

PGHP president director Mohamed Ismail at the laying of a corner stone of the plant said Indonesia is an important market for baby treatment industry.

The ceremony was also attended by industry minister MS Hidayat who expressed hope on the occasion that the new plant would spur national FMCG industrial growth.

He said the government fully supported the construction of the plant which shows that business opportunity in Indonesia is wide open.

Mohamed said six of 11 countries with the biggest baby population are in Asia. Indonesia is one of them with 17 million babies aged under 48 months.

"A lot of babies I think would need correct treatment especially when their parents have to adapt to a modern life style. At the time practical, healthy and trusted will be badly needed," he said.

The plant will take around two years to construct before it could fully operate.

In the next five years P&G expects demand for baby diapers in the country would reach around eight millions. The plant is expected to create around 400 jobs.

P&G hopes its products would reach hospitals and midwives. Its products at present are consumed by around 4.4 billion people in the world such as Pampers, Tide, Ariel, Always, Whisper, Pantene, Mach3, Bounty, Dawn, Fairy, Gain, Pringels, Charmin, Downy, Iams, Crest, Oral-B, Duracell, Olay, Head&Shpulders, Wella, Gillette, Braun, Fusion, Ace, Febreze and Ambi Pur.

P&G is operating in 80 countries and its producs could be found in more than 180 countries.

Editor: Priyambodo RH

Australia-Indonesia Institute inviting applicants for Youth Exchange Program

Antara News, Tue, August 9 2011

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Jakarta (ANTARA News) - The Australia-Indonesia Institute (AII) invites applications from young Australians aged between 21 and 25 years willing to represent Australia for two months in Indonesia during December 2011 to February 2012 as members of the Australia-Indonesia Youth Exchange Program (AIYEP).

The program aims to provide wider opportunities for young people from Indonesia and Australia to appreciate the culture, development and way of life of each other`s country, the Australian embassy said in a pres statement here on Tuesday.

It is also expected to build groups of young and potentially influential people in both Australia and Indonesia who have knowledge and personal experience of the two countries and who develop close and enduring links with each other.

Participants will be chosen from applicants undertaking tertiary studies or employed in any one or more of the areas such as agriculture, arts, music, Asian Studies, economics, business, International Relations, education, engineering, science, environmental management, journalism, sports, tourism and hospitality.

A good level of Indonesian language is desirable though not essential as the program makes allowances for some participants to learn the language during the period of the exchange.

The Indonesian AIYEP participants are due to arrive in Australia in October 2011, and the closing date for applications is on 30 August 2011.

Editor: Priyambodo RH

ADB Provides $100 Million for Rural Infrastructure, Sanitation in Indonesia

ADB, 8 Aug 2011

MANILA, PHILIPPINES – The Asian Development Bank (ADB) is providing Indonesia with a $100 million loan to finance community-driven projects that upgrade basic infrastructure in rural villages and improve sanitation services in poor urban neighborhoods.

The loan will expand ADB’s support for the National Program for Community Empowerment (PNPM Mandiri) for poverty reduction by providing direct assistance to poor communities.

While Indonesia has made significant progress in fighting poverty and achieving the Millennium Development Goals (MDGs), about 31 million people, many of them in rural areas, remain trapped in poverty. The causes of poverty include lack of access to basic services, absence of economic opportunities, limited access to capital, and poor rural connectivity and infrastructure.

About half of rural villages are not connected by asphalt road, and one in every ten villages are inaccessible at certain times of the year. In addition, only about half of the national population has access to improved sanitation. Consequently, some 30% of Indonesians suffer from water-borne diseases, including diarrhea and typhoid fever, that are linked to the use of untreated water and poor sanitation.

“The project will provide block grants directly to the communities to improve basic infrastructure facilities and sanitation services, including the construction of public baths, toilets and washing facilities, as well as waste treatment and disposal systems,” said Wolfgang Kubitzki, ADB Principal Social Sector Economist.

“Around 1.3 million people in rural communities and urban neighborhoods in nine provinces in Indonesia will benefit from the project,” he added.

The project will also improve the capacity of the communities to carry out their own design and implementation of the projects to ensure that the investments reflect the need of the communities and are sustainable.

The ADB loan, from its ordinary capital resources, covers about 73% of the total project cost of $135.6 million, with the government financing around 19% and beneficiaries providing the balance in the form of counterpart contributions to community investments.

The Ministry of Public Works is the executing agency for the project, which is due for completion around March 2015.

About ADB

Russia to invest $2.5b for railway construction in Kalimantan

The Jakarta Post, Jakarta | Mon, 08/01/2011

Russia is planning to invest US$2.5 billion for the construction of a railway connecting the Indonesian provinces of Central Kalimantan and East Kalimantan, an official said on Monday.

“The length will be 185 kilometers. It will be used to transport coal,” Rizal Affandi, the deputy for international cooperation at the Coordinating Ministry for the Economy, said after a meeting between Indonesian Coordinating Minister for the Economy Hatta Rajasa and Russian Ambassador to Indonesia Alexander A. Ivanov.

Rizal said the Indonesian government aimed to complete the project within three to five years.

He added that the project was part of the government’s Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development (MP3EI).

Russia agreed to invest after the visit of a number of ministry officials to Russia a while ago, Rizal said, as quoted by tempointeraktif.com.

RI, South Korea set up Green Business Center

Antara News, Fri, July 29 2011

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Jakarta (ANTARA News) - Indonesia and South Korea have set up a Green Business Center (GBC) through which they cooperate to develop green cooperatives, small- and medium-scale enterprises.

Syarief Hasan. (ANTARA)

Indonesia`s minister of cooperatives and small and medium businesses (UKM) Sjarifuddin Hasan said after the dedication of the GBC here on Friday that the institution was a follow-up of an agreement made by the Indonesian ministry of cooperatives and UKM with the Small and Medium Business Administration of the Republic of Korea.

"The GBC is located on the sixth floor of SME Tower Main Building on Jalan Gatot Subroto Kav 94," he said.

He said the GBC is an incubator for boosting cooperation in the development of green technology-based industries for cooperatives and UKM.

"Right now there are already 13 tenants joining in the GBC namely 10 from South Korea and three from Indonesia," he said.

Sjarifuddin hoped the GBC would in the future become the center of entrepreneurship development, transfer of technology especially green technology and boost business partnership between Indonesian and South Korean small and medium businesses.

On the occasion of the Administrator of Small and Medium Business of the Republic of Korea, Kim Dong-Sun, said the GBC would become one of the institutes that would develop green small and medium industries in Indonesia.

"We have the technology which is ready to be implemented while Indonesia has rich natural resources," he said.

He hoped the GBC would encourage transfer of technology to Indonesia for the development of eco-friendly small and medium businesses and further develop business partnership between Indonesian and South Korean small and medium businesses.

In the cooperation agreement South Korea expressed readiness to exchange experience in policy and program development to empower eco-friendly small and medium industries.

Editor: Priyambodo RH

SBY opens coal-fired power plant, pushes for more alternative energy

The Jakarta Post, Jakarta, Fri, 07/29/2011

President Susilo Bambang Yudhoyono on Friday said the proportion of geothermal energy in the second phase of the 10,000 megawatt project should be augmented.

"Do not just [adjust the contributions] from coal-fired power plants," the President said in Palembang, South Sumatra, on Friday at the groundbreaking of the Mulut Tambang Banjarsari coal-fired power plant (PLTU) in Lahat.

He added that increasing the contribution from geothermal energy power plants should be increased as part of efforts to rely more on renewable energy, kompas.com reported.

WB lends $300m for twin geothermal plants

Rangga D. Fadillah, The Jakarta Post, Jakarta, Wed, 07/27/2011

The World Bank has agreed to lend US$300 million to state geothermal producer PT Pertamina Geothermal Energy (PGE) to build two geothermal power plants in Ulubelu, South Sumatera, and Lahendong, North Sulawesi.

The bank said in a press statement sent to The Jakarta Post on Wednesday that the loan package came from the International Bank for Reconstruction and Development and Clean Technology Fund, with a contribution of $175 million and $125 million, respectively.

“The World Bank is pleased to be able to support Indonesia’s efforts to positively impact global climate change. This important project is the first approved Clean Technology Fund operation in the East Asia Region,” said Stefan Koeberle, World Bank country director for Indonesia.

“We appreciate the World Bank's support for PGE to contribute to efforts to utilize clean energy in meeting Indonesia’s growing power demand," said Abadi Poernomo, president director of PGE. "This assistance will contribute to PGE's goal of becoming a world-class geothermal company."

Upon completion of the project, by 2015, there will be approximate additions of 110 megawatts of electricity in Ulubelu and 40 megawatts in Lehendong. This will displace an equivalent capacity of coal-based power generation, which will reduce local and global environmental pollution.

2m poor elementary students to get scholarships

The Jakarta Post, Jakarta, Wed, 07/27/2011

The National Education Ministry says it has allocated Rp 762.2 billion (US$89.9 million) this year for BSM-SD scholarships for about 2.04 million poor elementary school students nationwide.

Students from first to fifth grade will be entitled to the scholarships, which are worth Rp 360,000 per student and will be disbursed between July and December.

Ministry director for elementary schools Ibrahim Bafadal said Tuesday in Jakarta the scholarships were meant to help poor parents purchase stationery, uniforms and other school-related items for their children.

School operating costs, meanwhile, are covered by the School Operational Aid (BOS) funding program, Ibrahim said.

The numbers of students to be granted scholarships in each municipality/regency has been set based on several indicators such as poverty levels and geographical conditions, he added.

“Each municipality and regency will then select schools that will receive BSM-SD scholarships. Then a team will be sent to ask for a list of the students that have been nominated to receive the scholarships at each school,” Ibrahim said as quoted by kompas.com.

Rp 1t Port Planned for Remote West Papua

Jakarta Globe, Faisal Maliki Baskoro, July 26, 2011

The proposed $118 million West Pacific Port in West Papua
would have  a capacity 30 times greater than the existing
Sorong Port. (JG Photo/Yudhi Sukma Wijaya)

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State port operator Pelindo II plans to start building a new port in Sorong, West Papua, as soon as next year, as part of government efforts to reduce logistical and shipping costs to the remote eastern region.

Richard Joost Lino, president director of Pelindo II, said on Tuesday that the company had formed a consortium with major shippers including Samudera Indonesia, Meratus Line, Salam Pacific Indonesia Lines, and Temas Line to build the port, which will cost Rp 1 trillion ($118 million).

“Pelindo will act as the leader in the consortium, and we will contribute 30 percent [of the cost],” he said. “We will put the project up for tender [for contractors] later this year while construction will start early next year.”

West Pacific Port, which will replace the existing Sorong Port, will be able to handle 750,000 twenty-foot equivalent units (TEUs) once it is completed in 2013, Richard said.

Sorong Port can handle 25,000 TEUs, while cargo traffic to the region averages 700,000 TEUs a year, he said.

West Pacific Port, Richard added, would also serve as a regional port for traffic to and from Papua New Guinea and the Bismark Islands, East Timor, Darwin in Australia, New Zealand and New Caledonia. The new port is also expected to halve distribution costs to Papua, he said.

Pelindo II operates 12 seaports across the archipelago, including the busiest, Tanjung Priok, in North Jakarta.

Analysts have said that Indonesia must boost the development of infrastructure such as roads, airports and seaports to create more jobs and achieve its target of 7 percent economic growth by 2014.

Juniman, an economist at Bank Internasional Indonesia in Jakarta, said the government’s plan to build the port in Papua was the right move to reduce bottlenecks in shipping.

“The project will help create jobs and boost economic growth,’’ he added.

Pelindo II is also bidding on the rights to operate a new port in Jakarta.

It signed a Rp 11 trillion loan with Bank Mandiri, the country’s largest lender, on Tuesday. That standby loan would be used to finance the first phase of its North Kalibaru Port project in North Jakarta, if Pelindo were to win the rights to build the port.

The Transportation Ministry has not yet closed the tender for the project, which will cost an estimated Rp 20 trillion.

“The new port is vital because the busiest port in Indonesia will exceed maximum capacity this year, and this will cause higher logistic costs and longer loading and unloading times,” Richard said.

North Kalibaru Port would add between 4 million and 6.5 million TEUs of cargo capacity to Tanjung Priok Port — which has a maximum capacity of 5 million TEUs.

Richard said the North Kalibaru facility, which would span 3.5 square kilometers and include an oil and gas terminal, could be completed in 2017.

Pelindo posted a 30 percent increase in profit last year to Rp 1.2 trillion and, according to Richard, is on track to meet its target of Rp 1.6 trillion in profit this year.

Indonesia is Google’s ‘Regional Focus’

Jakarta Globe, Shirley Christie, July 26, 2011

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Google, the world’s largest Internet-search provider, may make a “huge investment” in Indonesia to take advantage of the country’s enormous market potential, a government official said.

The Internet giant would focus its Southeast Asian investment on Indonesia, Gita Wirjawan, chairman of Indonesia’s Investment Coordinating Board (BKPM), said on Monday.

Google executive chairman Eric Schmidt said “Google wants to invest, and based on their calculation it would be bigger than its previous offices in Southeast Asia,” Gita told a press conference in Jakarta.

“I do not know yet whether it is going to be $100 million or more, but the investment would definitely be bigger than [the amount spent] in Singapore and Malaysia,” he said

Google could set up operations in Indonesia, Gita said, but the company needed to study the potential for revenue from advertising in the country and the establishment of a data center.

Those matters are being discussed with the Communications Ministry, he said.

Google’s global brand and innovative reputation means the company’s presence would encourage other investors to do business in Indonesia, Gita said.

BKPM forecasts total foreign and domestic investment hitting Rp 240 trillion ($28 billion) this year, up 15 percent from 2010.

Gatot Dewa Broto, a spokesman for the Ministry of Communications and Information Technology, told the Jakarta Globe the ministry welcomed Google’s plan and has not imposed any requirement for the company to establish a data center locally.

Schmidt met Indonesian Vice President Boediono last Friday to inform him of the company’s plan to open a representative office in Indonesia by next year.

At an entrepreneurial summit in Bali, Schmidt said Indonesia would have an “Internet explosion” that would change the country for the better.

“There are 50 million small businesses in Indonesia. Just numerically those will be the engine of growth for the future economy,” he said.

Other foreign companies have already established local businesses to appeal to Indonesia’s Internet users. Yahoo has been operating in Indonesia since early last year.

Indonesia has about 40 million Internet users and is home to Facebook’s second-highest number of subscribers.

Global research firm Frost & Sullivan found Indonesia had 194 million wireless subscribers at the end of last year, representing a penetration rate of about 81 percent. About 80 percent of mobile users are using Internet-enabled hand-held devices.

Indonesian advertisers spend less than 2 percent of their budgets on online promotions, meaning the online advertising industry here has significant space for expansion.

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Jakarta’s Soekarno-Hatta International Airport to Get $1.37b Face-Lift

Jakarta Globe, July 26, 2011

Mobile Brigade (Brimob) officers conducting search operations in an
 attempt to clean up Soekarno-Hatta International Airport on the outskirts of
 Jakarta recently. The substandard airport is to get a Rp 11.7 trillion
($1.37 billion) overhaul, the Ministry of Transportation said on Tuesday.
(JG Photo/F. Raharjo)  

    

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Jakarta’s substandard Soekarno-Hatta International Airport is to get a Rp 11.7 trillion ($1.37 billion) overhaul, the Ministry of Transportation said on Tuesday.

Herry Bhakti Gumay, director general of aviation transportation at ministry, was quoted by Detik.com as saying the revamp would be entirely funded by State-owned airport operator Angkasa Pura II.

“Construction will start in 2012 and in 2014, Soekarno-Hatta will become a world-class airport,” Herry told the news portal.

Changes included completing development of Terminal 3 by 2013, renovating terminals one and two, building a new cargo terminal by 2013.

Other improvements include an automated transportation system linking the terminals as well as a shopping mall and a hotel.

Herry acknowledged that Soekarno-Hatta was now incapable of coping with the number of passengers, which continue to grow.

“Currently the airport’s capacity is designed for 22 million passengers [annually] but in reality, the number of passengers has grown to 44 million,” Herry said.

The plan to redevelop the airport was first announced by Vice President Boediono in May.

Vice Presidential Spokesman Boediono’s said it was hoped that the number of passengers would increase to 62 million people by 2014.

“That will mean increasing the apron capacity from the current 125 aircraft to 174 aircraft.

Nissan to invest $320 mn in Indonesia plant

Yahoo/AFP, 26 July 2011

Japanese Nissan Motor said Tuesday it plans to invest $320 million in Indonesia to more than treble production capacity at its West Java factory and set up a new engine assembly plant nearby.

"We plan to increase production capacity at the plant from 50,000 vehicles per year to 180,000 vehicles for each year by 2013," Nissan Motor Indonesia vice president of sales and promotion Teddy Irawan said.

"This September we'll complete the first phase of the capacity expansion to increase production from 50,000 units to 100,000 units. In the next phase, we'll raise capacity from 100,000 units to 180,000 units," Irawan said.

Indonesia, Southeast Asia's largest economy, is seeking billions of dollars in foreign investment to help it achieve target of 7.0-percent growth by 2014.

The archipelago aims to attract private investment of up to $465 billion by 2025.

Indonesia may get U.S. help in going green

UPI.com, July 25, 2011 

DENPASAR, Indonesia, July 25 (UPI) -- Indonesia could get millions of dollars in financial aid during the next several years for a sustainable and green economy, the U.S. State Department said.

The U.S. Department of Energy in May examined the potential for investing in oil, natural gas and renewable energy in Indonesia. Both governments discussed the possibilities during talks in Bali between U.S. Secretary of State Hillary Clinton and her Indonesian Foreign Minister Marty Natalegawa.

The State Department said Indonesia under a Millennium Challenge Corp. compact could get around $600 million during the next five years for investments in environmentally sustainable green prosperity.

Both sides said they were working on completing a second agreement on forest conservation before September. The State Department said it planned to contribute around $20 million toward that agreement.

"I think both Secretary Clinton and I feel ever more confident that the comprehensive partnership between our two countries are in a good state, and that we are actually further deepening and strengthening our collaboration and partnership," said Natalegawa.

Over 500 Indonesian students head to the Netherlands

The Jakarta Post, Jakarta | Mon, 07/25/2011

Over 500 Indonesian students will leave for the Netherlands in pursuit of higher education, according to the Dutch Embassy in Jakarta on Monday.

“Through education, I am optimistic that the bilateral relationship between the two countries will be improved,” Dutch Ambassador to Indonesia Tjeerd F. de Zwaan said in a press statement as quoted by Antara news agency.

The statement says that the students include recipients of Dutch government-sponsored scholarships, namely StuNed, the Netherlands Fellowship Program and the Huygens Scholarship Program.

There are also recipients of Erasmus Mundus and Ford Foundation scholarships as well as those sponsored by the Indonesian Communications and Information Ministry, National Education Ministry and National Development Planning Ministry.

Data from Nuffic Neso Indonesia shows that 65 percent of the students will be pursuing Master's degrees while 28 percent are in undergraduate programs, Antara reported.

On Saturday, Zwaan, Nuffic Neso Indonesia director Marrik Bellen and the Indonesian Foreign Ministry director for Western Europe, Dewa Made Juniarta Sastrawan, officially bid the students farewell in an event in Jakarta, the statement said.