Apexindo wins new, extension contracts worth 57.7 million usd

Jakarta (ANTARA News) - Publicly listed PT Apexindo Pratama Duta (Apexindo) has been awarded new and extension contracts on oil rig projects worth US$57.7 million, an executive of Apexindo said.

"We have won a contract extension on a swampbarge rig project Raissa, in Tanu oil field, Kalimantan worth US$57.7 million. Besides, We also won a new contract on its onshore field worth US$4.6 million," Agustinus Lomboan, Apexindo`s finance director, said here on Thursday.

He said that the extension of the contract for another three years would contribute to the strengthening of the cash flow of the company in the future. Besides, the extension and new contracts would also reduce uncertainties to be faced in the future, he said.

Lomboan said the increase in rigging business activities in the country created positive impact on the company where Apexindo had been proactive in taking part in various rig project tenders both for offshore and onshore.

"We will try our best to maintain consistency in increasing the company`s efficiency drive and boosting corporate growth in both offshore and onshore rigging business," he said.

He added that Apexindo also hoped that it would be able to increase its profitability and sustainability in order to guarantee higher turn out for shareholders.

Indonesian tops regional survey for recreational shopping

The Jakarta Post, Jakarta, | Wed, 03/26/2008 1:15 AM 

Indonesia, Southeast Asia's largest economy, has been ranked at the top of a survey of Asian countries for believing shopping is an alternative recreational family activity.

The survey, conducted by AC Nielsen, gave the number one ranking to both Indonesia and Hong Kong, with 93 percent of respondents from each country saying they mixed shopping with family recreation and entertainment.

On a world scale, 74 percent of consumers considered shopping as entertainment, according to the survey.

"Shopping during the weekend and at end of the month is considered a family activity. The main enticements are comfort, security and a number of eating out and entertainment facilities," Yongky Suryo Susilo, AC Nielsen Indonesia's retailer service director, said Tuesday.

With few public parks available in most of Indonesia's big cities, families have no other option than to enjoy their free time in shopping malls, the number of which has grown unchecked in the past 10 years.

"People are not only buying products but they are buying an experience too," said Yongki.

The AC Nielsen survey also highlighted the so-called "multi-channel users" behavior of Indonesian consumers, relating to their preference for cruising traditional markets also despite the rapid growth of modern retail outlets.

Based on the survey, AC Nielsen found in Jakarta 83 percent to 99 percent of consumers shopping in modern stores were going to both convenience stores and traditional markets.

"Consumers of modern outlets still depend on traditional stores because of their prices and proximity," said Yongky.

According to the survey, consumers tend to shop in hypermarkets monthly, spending a large amount of money, in supermarkets for weekly needs at a medium or small amount of money, and at traditional markets for daily consumption.

"Young mothers prefer shopping from roving vendors than traditional markets for their daily consumption. They go to hypermarkets with their family for monthly shopping," said Yongky.

The survey also discovered 76 percent consumers were concerned about food safety.

"Apart from considering the quality of the products offered, consumers need hygienic and clean places to shop," said Yongky.

Agus Pambagio, an observer of the protection of consumer's rights and public policy, said that Indonesian customers now had a stronger retail bargaining power.

"The increasing number of shops, both traditional and modern, has given customers more alternatives. This has raised their bargaining power," said Agus.

He said Indonesian consumers were becoming more demanding because they were more aware of their rights. (rff)

Temasek sells BII stake to Maybank for 1.5 bln usd

Singapore (ANTARA News) - Singapore state-linked investment company Temasek Holdings said Wednesday it has agreed to sell its 75 percent stake in Sorak Financial Holdings Pte Ltd, an investment vehicle that holds a 56 percent stake in Bank Internasional Indonesia (BII), to Malaysia's Malayan Banking Bhd (Maybank) for 1.5 billion US dollars.

The transaction is subject to regulatory approvals, Temasek unit Fullerton Financial Holdings said.

Temasek holds the Sorak stake through Fullerton Financial.

"The strategic and financial rationale for the acquisition is extremely compelling. The acquisition will transform our growth prospects in Indonesia and is a huge step forward in our strategy to regionalize our operations through investments in selected high-growth markets," said Aminuddin Desa, acting chief executive of Maybank.

"We are excited as the Indonesian banking sector remains under-penetrated, with excellent long-term growth potential," Desa told Thomson Financial.

"BII is well placed to capitalize on this growth potential given its strong market position, extensive multi-channel distribution network and high-quality customer base."

Maybank told the Malaysian stock exchange that it will make a general offer for the remaining 44 percent of BII, as required by the rules in Indonesia.

The bank said it will file its statement on the buyout offer, which is expected to cost 3.8 billion ringgit, with the Jakarta Stock Exchange and BII in due course.

Asian IT services market to hit $56 bln by 2011: report

Bangalore (ANTARA News) - Asia's IT services market, led by India, is poised to expand at an average annual pace of 10.5 percent to reach 55.9 billion dollars by 2011, an industry research firm said on Tuesday.

Demand for IT services in the region, excluding Japan, was estimated to be worth 37.5 billion dollars in 2007, according to the findings of a report by Springboard Research, an IT market research firm.

India's information-technology services market, forecast to expand at an annual 18.6 percent rate, will remain the fastest growing, said the report.

But as a region, Greater China will offer the largest market opportunity in dollar terms at the end of the forecast period, it said.

"The Asia Pacific IT Services market is arguably the global leader in terms of growth, supplemented with a mix of mature and emerging markets," Phil Hassey, vice president for services research at Springboard, said.

"The markets of interest are not just the top four -- China, India, Australia and Korea -- but the emerging ones like Indonesia and Vietnam, which will register significant growth," Hassey added in a statement.

In India, annual economic growth of nine percent is spurring domestic IT spending as companies upgrade computer systems to stay competitive and consumers log onto the Internet.

The domestic market has largely been ignored by India's industry, which has boomed on work from Western firms trying to cut costs by taking advantage of India's English-speaking, computer-savvy graduates who work for lower salaries.

The Indian market is still "fragmented and a long way from maturity," Hassey said in e-mailed replies to queries from AFP.

Related Stories:

China SMBs set to spend US$42B on ICT

World Food Program Donates US$ 98 Million to Indonesia

Tuesday, 25 March, 2008 | 15:31 WIB

TEMPO Interactive, Jakarta: Coordinating Minister for People's Welfare, Aburizal Bakrie, and the World Food Program (WFP) signed a Memorandum of Understanding for food assistance yesterday. The agreement is aimed to help and rehabilitate the nutrition in Indonesia by extending the assistance and restoration program.

The agreement will be ongoing for three years until December 2010 with total funding of US$ 98 million, including US$ 56 million for food and US$ 42 million for operational costs.

The funding will be to improve nutrition for ages 24-60 months; pregnant women; breast-feeding mothers, and children aged 6-13 years old, and provide additional food for tuberculosis patients and poor families. The funding is also aimed at and sanitation and government assistance for natural disasters. “There is total of 845 million people that will benefit from this program,” said Aburizal, accompanied by WFP Director for Indonesia, Angela van Rynbach.

The effort to overcome starvation and malnutrition is one phase to achieve the Millenium Development Goals (MDG's). “Sufficient food is important to alleviate poverty,” he said.

The food commodities will be distributed to three provinces of West Nusa Tenggara, East Nusa Tenggara, and East Java. The commodities contain rice (58,432 tons), cooking oil (2,484 tons), biscuits (15,524 tons), instant noodles (6,764 tons), and wheat (42,137 tons).

The first phase of the program that goes through March, has been focused on malnutrition prevention, food rehabilitation for pregnant and breast-feeding women, recovery for TB patients, sufficient food in poor areas, and capacity building for related institutions.

REH ATEMALEM SUSANTI

UN issues first green certificate for RI

Adianto P. Simamora, The Jakarta Post, Jakarta | Tue, 03/25/2008 11:20 AM 

After two years, the United Nations has issued the first saleable "certificates of emissions reduction" (CERs) to Indonesia's publicly listed cement maker, PT Indocement Tunggal Prakarsa Tbk. 

The UN executive board on climate change issued a total of 17,635 CERs to Indocement's alternative fuel projects on March 14. 

"It is good news for Indonesia. Hopefully, more companies will be encouraged to switch to greener projects to tap into cash from the carbon trade scheme," Prasetyadi Utomo, secretary of Indonesia's designated national authority (DNA) on Clean Development Mechanism (CDM) told The Jakarta Post on Monday. 

Under the CDM, projects that reduce greenhouse gas emissions and contribute to sustainable development can earn saleable CERs. 

Countries with an emissions reduction or limitation commitment under the Kyoto Protocol can use the CERs to meet part of their obligations under the protocol. 

The certificates can be traded to 36 highly industrialized nations which have legally binding emissions limitation and reduction commitments. A CER currently sells for between 13 and 15 euros. 

The UN will also issue 23,474 CERs to PT Indotirta Suaka Bulan Farm on Tuesday. The company's project, located on Bulan Island near Batam, involves methane capture and combustion from swine manure and is expected to cut 166,000 tons of emissions per year. 

Prasetyahadi said the UN had informed Indonesian environmental officials of a plan to issue another 63,332 CERs to Indocement on Wednesday. 

DNA data shows PT Indocement registered two projects that reduce emissions through the use of alternative fuels such as biomass, rice husks, sawdust and used tires. 

The projects were developed in cooperation with the World Bank. 

The issued CERs are transferred electronically from the CDM Registry through an international transaction log, administered by the UN Framework Convention on Climate Change Secretariat, to national emissions registries. 

As of March 1, the UN had issued CERs to 306 projects, mostly in China and India, totaling 126.6 million CERs. 

The CDM is expected to generate more than 2.6 billion CERs by the time the first commitment period of the Kyoto Protocol ends in 2012. 

The UN has said there are currently more than 948 registered CDM projects in 50 developing countries, and another 2,000 projects in the registration pipeline. 

The government has so far approved 47 CDM projects, of which half were registered this year following the UN climate change conference in Bali. 

Among the approved projects are a fuel switching project conducted by PT Asahimas Flat Glass Tbk at its flat glass manufacturing facility in Sidoarjo, PT Gikoko Kogyo Indonesia's gas flaring project in Palembang and a waste recovery project in Ubud, Bali.

PLN to provide two mln LHE connections for free in Sulawesi

Makassar (ANTARA News) - State-owned electricity company PLN will provide two million light & heat energy (LHE) power connections for free for 450 VA household customers in South, West, South East Sulawesi in the near future. 

"We are now waiting for the arrival of the lamps from Jakarta. We hope we will begin distributing them in May," PLN`s Commercial Manager for South Sulawesi, West Sulawesi, SE Sulawesi office, Irwan Nasution said here on Tuesday. 

He said that each of the household customers would get three light & heat energy lamps of 8 watts so that the number of customers that would get the efficient power connection facility would reach 600,000 or about 60 percent of the 900,000 household customers with the wattage limit of 450 VA in these regions. 

Irwan said that the distribution of the LHE was expected to reduce the use of electricity at peak burdens because in these regions about 70 percent of PLN`s 1.3 million customers were households with a wattage of 450 VA. 

Diece Uinana, PLN`s deputy marketing manager, said meanwhile that PLN would install the LHE connections itself in the customers house in order to guarantee that they would really use the facility.

CORPORATE AID

The Jakarta Post, Mon, 03/24/2008 12:27 AM  

 

Bank BRI president director Sofyan Basyir (left) and Maritime Affairs and Fisheries Minister Freddy Numberi (2nd right) chat with local fishermen after giving aid to 32,545 households in Nelayan village, Muara Angke, North Jakarta, on Sunday. The aid, which consisted of staple food supplies, had a total value of Rp 5 billion (about US$550,000), and was part of the bank’s corporate social responsibility program. (JP/P.J. Leo)

International Paper to invest $4b in pulp factory

The Jakarta Post ,  Jakarta   |  Mon, 03/24/2008 1:10 AM 

A giant U.S.-based paper and pulp company, International Paper, plans to invest more than US$4 billion in a pulp factory and industrial forest.

Director general for forest product management at the Forestry Ministry, Hadi S. Pasaribu, said the pulp factory would have the capacity to produce 1.5 million tons of pulp per year.

"They are planning to establish a 500,000-hectare plantation forest to support the pulp factory," he said, as quoted by Antara.

Hadi said Central Kalimantan and Papua had been chosen as the investment locations despite a lack of supporting infrastructure because no similar businesses operated there.

International Paper revealed their interest directly to Forestry Minister MS Kaban last month. Representative president of International Paper Asia, Thomas Gestrich, and the company's director for strategic planning and development in Asia, Aaron Yu, met with Hadi last week to discuss their plans.

International Paper is currently rated among the three largest pulp and paper producers in the world. They operate two factories in Brazil and Canada.

The company chose Indonesia for its business expansion, Hadi said, after conducting a six-month feasibility survey in a number of Asian countries.

He said the company planned to use 25 percent of its forest for biodiversity conservation.

"They plan to allocate a further 25 percent of the forest to be managed in partnership with the community or small-scale domestic enterprises. The company will manage the remaining 50 percent," Hadi said.

The government offered International Paper two options: to develop a new forest or to acquire existing forests owned by other companies.

Hadi said he had requested International Paper follow Indonesian investment regulations by establishing a local company here.

By 2007, Indonesia had 84 integrated pulp and paper mills, with a total production capacity of 6.5 million tonnes.

Two of its largest pulp and paper companies are PT Indah Kiat, a unit of Asia Pulp and Paper, and PT Riau Andalan, a subsidiary of APRIL, which is part of the Raja Garuda Mas International group.

These two companies produce more than 65 percent of Indonesia's total pulp output. The companies require a total of 9 million tonnes of wood each year.

Some raw material suppliers for the two companies have been banned by the police from logging since last year, because of illegal logging cases, making it difficult for the companies to obtain raw materials.

"If the bans continue to be enforced throughout this year, the factories may need to import wood chips," said president of the Indonesian Pulp and Paper Association HM Mansur.

He said the situation could result in a total loss of 4 billion tonnes of wood production, worth at least $3 billion. (lva)

Indonesia plantation firm to stage IPO in April

Jakarta (ANTARA News/Asia Pulse) - PT Gozco Plantations has said it will sell 1.5 billion shares or 30 per cent of its shares in an initial public offering (IPO) to be held next month.

The company said it hoped to secure approval from the capital market and financial agency watchdog Bapepam in the first week of next month. The company has named CLSA and Semesta Indovest as lead underwriters.

It said that 10 per cent of the funds from the share sales would be used to repay a debt owed by subsidiary PT Suryabumi and 15 per cent to increase its working capital, with the rest to finance seedling growing and cultivation.

Indonesia's Semen Gresik Q4 profit jumps 87 pct

Sun Mar 23, 2008 11:24pm EDT

JAKARTA, March 24 (Reuters) - PT Semen Gresik Tbk SMGR.JK, Indonesia's largest cement firm, posted results on Monday indicating a better-than-expected 87 percent rise in fourth quarter net profit, boosted by a building boom and more efficient operations.

Southeast Asia's biggest economy has seen a push by authorities to increase investment on ageing infrastructure including toll roads, ports, airports and power plants.

State-owned Semen Gresik's net profit rose to 503.5 billion rupiah ($54.85 million) rupiah in October-December from 268.7 billion rupiah a year ago, according to Reuters calculations based on its full year earnings released on Monday and nine-month results.

Analysts polled by Reuters Estimates had predicted a full-year net profit of 1.65 trillion rupiah, implying a fourth quarter net profit of 378.7 billion rupiah.

Gresik's revenue climbed 11.8 percent in the quarter to 2.51 trillion rupiah, as its sales volume for the period climbed 35 percent to 3.9 million tonnes, outpacing a 6.1 percent rise in national consumption.

In 2007, domestic demand for cement rose 6.6 percent to 34.2 million tonnes in 2007 from the previous year, due to such infrastructure projects and property developments in the biggest cities, although Gresik's domestic sales volume for the year rose only by only 1.6 percent.

To meet anticipated higher demand in the future, Gresik had said it plans to construct new factories and its own power plants in an effort to boost its annual capacity by 5 million tonnes, with a total investment of $1.5 billion.

The company had said it aims to boost its capacity by 40 percent to 22.9 million tonnes by 2013 from around 16 million tonnes currently. ($1=9,180 rupiah)

(Reporting by Harry Suhartono, editing by Ed Davies)

Bulgaria and Indonesia to Promote Each Other's Tourism

Novinite.com, 22 March 2008, Saturday

The visit of Indonesia's Minister of Culture and Tourism Jero Wachik in Bulgaria continued Saturday with discussions about how the two countries can promote the tourism contacts between one another.

Minister Wachik said he was going to do everything possible to develop the relations between Bulgaria and Indonesia in the fields of culture and tourism. He stated that the 220 million Indonesian traveled a lot, and that it would a huge success for Bulgaria if it managed to attract at least a part of them.

The Head of Bulgaria's State Agency for Tourism Aneliya Krushkova said in turn she was surprised by that fact that 2 800 Indonesian citizens visited Bulgaria in 2007, the press service of the Agency reported.

Indonesia is visited by 5 million tourists each year, which is just as many as Bulgaria, but Indonesia receives about USD 5 B from tourism, or 9% of its GDP, whereas Bulgaria gets only USD 2,3 B

Saturday evening Minister Wachik is going to present the "Visit Indonesia 2008" program in the National Archaeological Museum attempting to attract as many Bulgarian tour operators and tourist agents as possible. Aneliya Krushkova said this would be an act of promoting the Indonesian tourism in Bulgaria.

Indonesia to open furniture showroom in Shanghai

Shenzhen (ANTARA News) - Indonesia in May 2008 will have a showroom for furniture products in Shanghai, China, in order to promote Indonesian furniture among Chinese people on a continuous basis.

"We will build a permanent showroom in Shanghai to promote furniture and handicraft products in Shanghai in May," chairman of the Indonesian Furniture and Handicraft Products Association (Asmindo) Ambar Tjahyono said here on Friday.

He was in Shengzhen to attend the 22nd Shenzhen International Furniture Exhibition (SIFE), popularly called as a special furniture and handicraft products expo, participated in by 40 Indonesian businessmen and hundreds of Chinese and Asian businessmen.

The building of the showroom supported by the government of Indonesia was the initiative of the private sector that covered the cost.

According to him, Shanghai was chosen as the location of the showroom because the city had a strategic location for holding such exhibitions on account of the city`s advanced and complete infrastructure.

Dubai investors to invest US$3.5 billion in Indonesia

Dubai (ANTARA News) - A number of investors from Duba, the United Arab Emirate (UAE), have expressed commitment to investing US$3.5 billion in Indonesia, President Susilo Bambang Yudhoyono said before concluding his working visit here on Thursday.

President Yudhoyono pointed out that a number of companies in the Middle East such as Bin Ladin Group, Emaar Properties, Gulf Petroleum, Pacific Inter Link, Jumeirah Group, and Ras Al Khaimah would invest in Indonesia.

"They have expressed commitment to investing in Indonesia and said they were happy to do so," Yudhoyono said, adding that the government would try to do its best in creating conducive climate for investment in the country.

Earlier on Wednesday morning Yudhoyono held a business meeting with 75 business makers from 37 companies during his working visit in the United Arab Emirates (UAE).

The president and his entourage arrived at Dubai`s Royal Air Wing international airport at 7.15 local time on Tuesday after flying for about 10 hours from Johannesburg, South Africa.

After the meeting with the businessmen, Yudhoyono held a special meeting with a number of businessmen including the CEO of Emaar (tourism investor in Lombok), M Ali Alabbar, the CEO of Pacific Inter Link (Agrobusiness), Fouad Hayil Saeed from Qatar Islamic Bank, Abdul Latif bin Abdulla al Mahmod of Ras Al Khaimah dealing with infrastructure sector.

In addition, President Yudhoyono also met with Crown Prince Sheikh Saud bin Saqr al Qasimi and Sheikh Bakar bin Ladin to discuss about investment opportunities in Indonesia.

The president and his entourage were scheduled to return home from Dubai at 07.30 a.m. local time after making a 10-day overseas tour of four countries - Iran, Senegal, South Africa and the United Arab Emirates (UAE).

The President`s 82-member entourage included Foreign Affairs Minister Hassan Wirajuda, Minister/State Secretary Hatta Radjasa, Trade Minister Mari Elka Pangestu, Religious Affairs Minister Maftuh Basyuni and chairman of the Indonesian Chamber of Commerce and Industry (KADIN) MS Hidayat.

Indonesia`s United Tractors to invest US$200 mln this year

Jakarta (ANTARA News/Asia Pulse) - Indonesian heavy equipment company PT United Tractors (UT) (JSX:UNTR) said it will spend US$200 million this year, mainly on new equipment.

United Tractors finance director Gidion Hasan said replacement of old equipment used by its subsidiary PT Pamapersada will cost around US$150 million.

PT Pamapersada operates in mining contracting service handling a number of projects awarded by a number of major coal mining companies such as PT Adaro Indonesia, PT Kaltim Prima Coal, PT Tambang Batubara Bukit Asam (JSX:PTBA) and Kideco Jaya Agung.

Mercedes intending to make RI bus production base for three regions

Jakarta (ANTARA News) - German auto maker Mercedes Benz intends to make Indonesia a production base for its buses for markets in Southeast Asia, the Middle East and Africa, a company executive said.

"Our choice fell on Indonesia because we have experience in investing in this country and Indonesia is a potential market for passenger cars like buses," Mercedes Benz CEO for Indonesia Rudi Borgenheimer said after a meeting with Vice President Jusuf Kalla here, Tuesday.

He said, he would hold further internal meetings on the plan with the company`s headquarters in Stuttgart, Germany.

"The formal decision (to make Indonesia a Mercedes Benz bus production base) will possibly be taken within the next six months. After that, in two or three years our factory in Indonesia (in Gunung Putri, Bogor) can begin production," he added.

To increase its bus production capacity to 9,000 units and meet demand in the three regions of the world, Mercedes Benz would have to make a total investment of some 10 million Euro.

Currently, Mercedes Benz was turning out 600 buses and 2,250 sedans per year in Indonesia.

With the plan to make Indonesia a bus production base for three regions, the company would increase its production capacity to 9,000 units per year, Brgenheimer said.

"We are optimistic about this plan. Because we have the experience and a good history in Indonesia. In the early 1990s we were producing 2,000 buses per year in Indonesia," he said.

Sigma eyes 50 percent rise in revenue after acquisition

The Jakarta Post , Jakarta , | Tue, 03/18/2008 1:13 AM

Information communications technology (ICT) provider PT Sigma Cipta Caraka, newly acquired by PT Telkom, is targeting the addition of 120 clients and at least US$40 million in revenue this year.

Sigma was acquired by Telkom on Feb. 22 when the nation's largest telecommunications firm purchased an 80 percent stake in Sigma for $35 million.

"We're optimistic of the target due to the huge potential the ICT industry offers in the country," president director Djarot Subiantorom said Monday, adding that the revenue target was a 50 percent increase from last year's.

Sigma currently has 170 clients, mainly banks, while Telkom has around 6,000.

The acquisition would help Sigma achieve the target, Djarot said.

"Apart from benefiting from Telkom's huge number of clients, the arrival of Telkom is expected to strengthen Sigma's competitiveness in terms of network competency as well," said Djarot.

"By this acquisition, both Telkom and Sigma hope to be main players in ICT at a regional level," he said, adding that the company planned to go public with a 20 to 30 percent release of its stake within two years.

The acquisition was Telkom's first in the ITC sector. Telkom has said it is planning soon to acquire 12 IT companies in Southeast Asia and South Asia.

Matahari to spend big on new store

The Jakarta Post , Jakarta , | Tue, 03/18/2008 1:16 AM

Publicly listed retailer PT Matahari Putra Prima is planning to invest as much as Rp 450 billion (US$49 million) on 15 new hypermarkets this year, the firm's executive says.

Director of merchandising and marketing for food business, Carmelito J. Regalado, said the new stores would be concentrated in Bali, Kalimantan and Sulawesi.

Matahari's hypermarket business, under the flagship Hypermart, contributed 42.5 percent to the firm's total revenue last year.

The company recorded consolidated sales of Rp 9.8 trillion last year.

"This year we are introducing the last generation of our grocery shopping experience, by building the first Hypermart that stands alone from malls or other shopping centers," he said.

The company has just built its 38th 10,000-square-meter Hypermart store at Puri Village in West Jakarta.

"Starting from this year we are going to continue with the concept. All of our new hypermarket stores will stand on their own," Regalado said.

According to Hypermart vice president for store operations, Emi Nuel, there are currently a total of 112 hypermarkets in Indonesia.

"Carrefour has 40 stores, while Matahari has 38 stores and Giant 17 stores. The remaining ones are owned by other firms," he said, adding that the firm would remain committed to supporting small-scale suppliers with training.

"As with other Hypermart stores, we'll provide trainings for the (Puri Village) store's 80 suppliers. We have also prepared an area large enough for 20 street vendors in the back of our Hypermart in Puri Village," Emi said.

Matahari built its first hypermarket in 2004. (lva)

ADB Funds Environmental Plan to Save 'Coral Triangle' and 'Heart of Borneo'

Asian Development Bank

(14 March 2008) - The Asia Development Bank will provide a $1.5 million grant for environmentalists to work with Brunei, Indonesia, Malaysia and the Philippines to draw up a plan to protect the region's seas and rainforests which are being damaged at an alarming rate.

Read the full story

Sampoerno Agro to spend Rp 600b to up output amid rising CPO prices

Agustina Wayansari , The Jakarta Post , Jakarta | Sat, 03/15/2008 11:56 AM

Riding the wave of soaring prices of crude palm oil, publicly listed palm oil producer PT Sampoerna Agro is setting aside up to Rp 600 billion (US$65.2 million) this year to boost production.

Finance director Eddy Kurniawan said the money would be spent on new land, factories and supporting infrastructure -- in order to increase its production of palm oil to 1.27 million tons this year.

"In the near future, we will increase our plantation area by up to 15,000 hectares, managed both by ourselves and in partership with local farmers in Sumatra, Kalimantan and Sulawesi," he told reporters after a shareholder meeting.

The company, which currently manages 78,710 hectares of plantations mainly in Sumatra, produced 1.18 million tons of crude palm oil last year, up from 1.15 million tons in 2006, Eddy said.

The Indonesian Palm Oil Association said Thursday the country's CPO production would increase by 27 percent this year from 18.4 million tons in 2007.

Eddy said Sampoerna managed five factories, four in Palembang, South Sumatra, and one in Kalimantan, with a combined production capacity of around 350 tons per hour.

He said buying other existing plantation companies would be too costly.

President director Allan Goh said the company had adequate cash reserves to buy the land, after benefiting from crude palm oil prices nearly doubling last year to US$1,200 per ton, up from $585 in 2006.

Allan said Sampoerna might consider seeking extra funding from outside sources, including loans from banks, in case it needed additional capital for its expansion.

"The number (Rp 600 billion) is our conservative estimate, with CPO prices assumed at between $800 and $950 per ton," he said.

Goh said the company would remain focused on the local market this year, with 94 percent of its output sold to the domestic market in the last two years. The remaining oil was exported mainly to India and China.

"The local market offers us better prices and lower operational costs for transportation and logistics management," he said.

Sampoerna also announced it would allocate some Rp 10.99 trillion out of a Rp 249.135 trillion net profit in 2006 to be distributed as dividends for shareholders.

With total shares of 1.89 billion, each share has a dividend of Rp 126.

City to have more elevated roads as of next year

Mustaqim Adamrah , The Jakarta Post , Jakarta | Wed, 03/12/2008 11:55 AM

Governor Fauzi Bowo said Tuesday the capital would start a Rp 40 trillion (US$4.2 billion) project constructing elevated roads across all municipalities in Jakarta next year. Six toll roads are included in the project.

"We must understand that horizontal road expansion is no longer a favorable solution in easing traffic jams," he said at City Hall.

"Therefore, we have no other choice except to build more elevated roads."

He said elevated toll roads were also part of a plan to generate revenue for the city.

"We could use more revenue from toll roads to fund the development of other roads, as well as the development of an MRT, the monorail and the busway," said Fauzi.

The MRT (Mass Rapid Transit) is a rail system Jakarta has been planning since 1984. Plans to begin construction this year have again been delayed until 2010.

He said, however, more research was required to measure the impacts of the construction, such as congestion.

"Both the central government and the city administration agree road expansion on ground level will not solve transportation issues in the city," he said.

"But we can think of another way to solve traffic problems. We have to carefully decide the locations of the toll road exits and entrances in the design."

Wrong locations of toll road exits and entrances, Fauzi said, would create worse traffic jams.

He also said the money needed to fund the elevated roads project would come from the administration, the capital market, the money market and loan syndicates.

Fauzi said the city would start the toll road construction in North Jakarta because MRT construction was planned for the same time in the south.

The Rp 8.3 trillion ($913 million) MRT project will stretch 14.3 kilometers from Lebak Bulus, South Jakarta, to Dukuh Atas, Central Jakarta and is expected to be finished in 2014.

In addition, Fauzi said the design would also calculate increased air pollution resulting from road expansions that consequently encourage more people to use vehicles.

The six planned toll roads

1. Rawa Buaya, West Jakarta - Sunter, North Jakarta 18.6 km
2. Kemayoran, Central Jakarta - Kampung Melayu, East Jakarta 9.7 km
3. Pasar Minggu, South Jakarta - Casablanca, South Jakarta 9 km
4. Kampung Melayu, East Jakarta - Tomang, West Jakarta 12 km
5. Sunter, North Jakarta - Pulo Gebang, East Jakarta 12.5 km
6. Ulujami, South Jakarta - Tanah Abang, Central Jakarta 8.6 km

Pertamina, Iran firm to build $6b refinery

Riyadi Suparno , The Jakarta Post , Tehran | Wed, 03/12/2008 1:34 AM

State oil company PT Pertamina signed here Tuesday a joint venture shareholder agreement with National Iranian Oil Refining & Distribution Co. (NIORDC) and Petrofield Refining Company of Malaysia to build a US$6 billion oil refinery plant in Banten.

Pertamina president Ari Soemarno explained that within two weeks of the signing, the three parties would establish a joint venture company in Indonesia which would start immediately on the project to be located in the neighboring province near Bojonegara.

If things proceed as expected, the refinery plant will be ready by 2012, with most of the four-year period to be consumed with construction of the physical plant itself.

"We don't know yet the possible impact of the new sanctions (adopted by the United Nations Security Council) against Iran on our project. But we hope this project will proceed as is," Ari said.

He said Pertamina and Oil Refinery Industries would each have a 40 percent stake in the new company, with Petrofield holding the other 20 percent.

Pertamina, he said, would use a combination of internal financing and loans to come up with its capital contribution to the project. The loans were expected to make up some 65 percent of the total.

During phase one, the refinery would run at 150,000 barrels of crude oil per day. Pertamina and its partners are planing to eventually expand refinery capacity to 300,000 barrels per day.

"Iran is committed to supplying half of the crude oil needs of the refinery, in other words, 150,000 barrels per day," NIORDC president Mohammad Reza Nematzadeh said.

The 300,000 barrels crude oil figure translates into 200,000 barrels of fuel, or about one sixth of the country's total needs.

Currently, because of limitations in domestic refinery capacity, Indonesia imports fuel - -mostly from Singapore -- to the tune of about 400,000 barrels of crude oil equivalent daily.

Thus, once the Banten refinery plant is up and running, it is hoped the coutry will be further able to realize substantial reductions in its dependence on imported fuels.

In addition to the oil refinery plant, Pertamina is also looking into the possibility of investesting into the upstream oil industry in Iran.

Pertamina, Ari said, has participated in a tender for the Laleh offshore oil and gas block, in which it ranked second in the list after an Iranian oil company.

"The Iranian company has agreed to take us as a partner in developing this Laleh oil field. So, we are looking into this possibility of entering into Iran's upstream industry," he said.

Laleh is one of 17 oil and gas blocks the Iranian government has recently put on offer.

Iran is the second largest oil producer at the Organization of Petroleum Exporting Countries (OPEC).

Indonesia to build four nuclear power plants by 2025

The Jakarta Post

Antara , Surakarta, Central Java | Wed, 03/12/2008 3:02 PM

The government plans to build four nuclear power plants by 2025 to meet electricity demand, State Minister for Research and Technology Kusmayanto Kadiman said Wednesday.

"If one nuclear power plant can produce 1,200 megawatts of electricity, we need four plants by 2025 to meet demand," he said during a visit to Surakarta's March 11 University.

"We have surveyed a number of sites for the nuclear plants including in northern Java and southern Kalimantan."

Kusmayanto said going nuclear was part of the country's 2004- 2025 long-term development plan.

The government plans to build the first nuclear power plant near Mt. Muria in Jepara, Central Java. The plant is expected to be operational by 2016 despite strong opposition from residents and environment activists.

"We have to start the construction this year. Otherwise, we will be behind schedule," Kusmayanto said.

"It is normal if there are parties who oppose the plan. We have prepared everything for the nuclear power plant from planning, technology, financing to human resources."

Indonesia currently has three nuclear reactors for scientific purposes in Bandung, Yogyakarta and Serpong, Banten.

IHG to open two new resorts in Bali under InterContinental and Holiday Inn Brands

08/03/2008 10:39

The FINANCIAL -- IHG (InterContinental Hotels Group) announced the expansion of its resort portfolio in Bali, Indonesia's top leisure destination, with the signing of the InterContinental Bali Sanur Beach Resort and a Holiday Inn Resort on Tuban.

InterContinental Bali Sanur Beach Resort, managed on behalf of PT Restu Maharani, is scheduled to open in late 2009. The new-build resort designed by award-winning architectural firm eco-id with interiors by Hadiprana will occupy seven hectares of beachfront property on the tranquil coastal village of Sanur. The luxury resort's 104 rooms and suites will be located in low-rise cluster pavilions and will be complemented by 54 private villas, all featuring private pools with underwater seating, outdoor showers and private landscaped courtyards. The resort will also offer a wide selection of premium facilities, including a luxurious Spa InterContinental with spacious indoor and outdoor treatment areas, an all-day beachfront restaurant and specialty dining. InterContinental Bali Sanur Beach Resort will be the second InterContinental hotel on the island and sister property to the award-winning 418-room InterContinental Bali Resort on Jimbaran Bay.

The Holiday Inn Resort on Tuban is a 200-room property set on three hectares of Balinese gardens with direct beach access. Managed by IHG on behalf of PT Menara Perdana, the resort's opening later this year will mark the Holiday Inn brand's entry to the island. Extensive refurbishments are underway to bring the property to Holiday Inn Resort brand standards. Facilities will include a Tea Tree Spa and a kids' club with extensive outdoor play area.

"Bali is one of Asia's most popular destinations, attracting high-spending leisure travellers, corporate meeting attendees as well as families. IHG already manages a successful InterContinental resort on Jimbaran Bay and with these two new hotels, our guests can look forward to more choice of accommodations across two brands in three unique locations," said Jan Smits, chief operating officer, Southern Asia and Korea, IHG Asia Pacific.

Entrepreneur group to help SMEs tap stock market

The Jakarta Post , Jakarta , | Tue, 03/11/2008 1:38 AM

The Indonesian Young Entrepreneurs Association (HIPMI), made up largely of owners of small and medium enterprises, has commissioned a research study on ways in which SMEs can benefit from the stock market boom.

The research will be jointly conducted with state-owned financing firm PT Bahana Pembinaan Usaha Indonesia (BPUI) and a research institution, the Center for Finance, Investment and Securities Law (CFISEL).

"The main problems for SMEs are related to capital, market access and business development. The capital market is an alternative solution to such problems," Hipmi chairman Sandiaga S. Uno told reporters in Jakarta on Monday.

He said of the 40 million SMEs in Indonesia, some 1,700 had the potential to enter the stock market as they possessed assets ranging from Rp 5 billion (US$545,000) to Rp 50 billion ($5,450,000).

Presently HIPMI has 100,000 members across 33 provinces.

President director of BPUI, Boyke Mukijat, said SMEs needed thorough business plans before entering the stock market.

"SMEs in England, Canada, Italy and many other countries have successfully expanded their businesses by going public. We believe the same can be achieved in Indonesia," he said.

BPUI, which serves as the backbone of Bahana Group, provides financial infrastructure for various kinds of businesses.

Edward T. Lubis, director of Bahana TCW Investment Management, another member of the Bahana Group that deals with investment funds, said SMEs could take advantage of current developments in the stock market.

"Foreign capital is returning to Indonesia and a shift is happening in our society's financial policy, from savings oriented to investment oriented," he said.

Boyke said BPUI wanted to make sure SMEs took this opportunity with full awareness of what to expect and how to meet expectations.

He said the research study would provide case studies of SMEs that had successfully participated in the stock market.

Sandiaga said one of the problems SMEs faced in accessing the capital market was the requirement for them to establish limited corporations before going public.

"The government should also consider devising a mechanism that will facilitate SMEs to enter the capital market," he said.

Wahyuni Bahas from CFISEL said financing facilities currently offered to SMEs, such as loans from the government or from commercial banks, were spoiling them.

"When SMEs go public, they are forced to improve their management, fulfill responsibilities to shareholders and make other positive improvements," he said. (lva)

Adaro plans IPO in Q4

The Jakarta Post | Tue, 03/11/2008 1:37 AM

Indonesia's second largest coal producer, PT Adaro Indonesia, is planning to unload some of its stake to the public through an initial public offering in the fourth quarter of this year in a bid to help fuel its expansion.

"We hope to be able to go public in September or during the fourth quarter of this year. Our target is to raise some US$500 million," said Sandiaga Uno, who with tycoon Edwin Soeryadjaya and other investors control Adaro through private equity firm Saratoga Investama Sedaya.

Saratoga controls around 33 percent of Adaro, which produces around 25 million tons of coal annually.

Sandiaga said Adaro would probably sell between 20 and 30 percent of its stake, with Goldman Sachs, DBS Vickers and UBS AG Securities underwriting the sales.

He said around $200 million of the IPO's proceeds would be used to refinance the company's debts, and the remaining $300 million would be set aside to purchase four coal mines and to construct a power plant.

Herbal medicine expected to soar this year

Aditya Suharmoko , The Jakarta Post , Jakarta | Mon, 03/10/2008 1:20 AM

Herbal medicine, known locally known as jamu, has become increasingly popular recently as global consumer trends turn to nature and 'old wisdom' in search of cures.

Indonesia's major herbal consumers and producers are likely to see jamu getting a stronger foothold this year, with growing demands from both domestic and export markets as well as government support, the jamu association says.

"The jamu industry has good potential for development, with an annual growth of around 20 percent," said Charles Saerang, chairman of the Indonesian Herbal and Traditional Medicines Entrepreneurs Association (GP Jamu).

This year, he said, the country's herbal medicines industry could reach total sales of Rp 5 trillion (US$550.96 million), up 20 percent from Rp 4 trillion in 2007.

As for exports, jamu entrepreneurs have aimed to double last year's US$4 million of exports.

Nyonya Meneer and Sido Muncul, the two largest jamu producers in Indonesia, which export to destinations including Malaysia, Singapore, the Philippines, Taiwan, Saudi Arabia, the U.S. and the Netherlands, both plan to diversify their export destinations this year.

Another reason to be positive about jamu sales and exports, Charles said, was the new found government support that recently registered copyright for jamu as an Indonesian trademark.

"The government and industry have agreed that 'Jamu' should be recognized as an Indonesian trademark. As the next step, the government must promote jamu to the world," he said.

China's herbal medicine industry grew significantly after it began to get support from the Chinese government, he added.

As its first steps to promote jamu to the rest of the world, the Indonesian government plans to hold an international symposium on Temulawak (Curcuma xanthorrhiza) in late May and an international exhibition on jamu next year.

More than 80 percent of the country's total population (220 million) have consumed jamu--a really huge target market, GP Jamu says.

"In Malaysia, almost half the population consume traditional medicine. Imagine if this happened in Indonesia," Charles said.

Sido Muncul president director Irwan Hidayat believed the country's jamu industry could be developed further.

"Some pharmaceutical companies have introduced semi herbal medicine to cure colds (masuk angin) to compete with jamu. This shows the jamu industry has a huge market," he said.

Currently, Indonesia has some 1,243 jamu producers, 129 of which are large-scale producers. The rest are small and medium enterprises (SMEs) operating mostly in East and Central Java.

SMEs contribute around 20 percent of the total annual jamu sales nationally.

The industry could employ at least 3 million workers per year, Charles said.

"This number could increase, considering more and more Indonesians take jamu."

He also said the industry planned to acquire more land in East and Central Java because farmers could grow herbs there more easily.

Jamu producers have become more creative with products and packaging, like selling jamu in syrup form. The rising price of medicine has also helped to sway consumers toward traditional medicine, Charles said.

The future, however, was not all rosy for jamu, as producers were challenged to make products that comply with standards set by the Drugs and Food Monitoring Agency (BPOM), he said.

Currently, only 10 out of 1,243 jamu producers produce "quality" herbal medicine.

Many unauthorized herbal medicines are distributed nationwide and could threaten the growth of the jamu industry, Charles said.

Sales Performance: - 2006 Rp 3 trillion - 2007 Rp 4 trillion - 2008 Rp 5 trillion (forecast)

Export: - 2007 US$4 million - 2008 US$8 million (forecast)

Big Players: - Martha Tilaar - Mustika Ratu - Sido Muncul - Nyonya Meneer - Jamu Jago

Maybank keen to buy indirect stake in Indonesian bank

The Star Online

PETALING JAYA: Malayan Banking Bhd (Maybank) yesterday announced it was keen to buy an indirect stake in PT Bank Internasional Indonesia Tbk (BII).

Despite two earlier failed attempts to have a presence in Indonesia, Maybank is now seeking to acquire a stake in Indonesia’s sixth-largest bank, from the latter’s major shareholder, Fullerton Financial Holdings Pte Ltd. Fullerton is a unit of Singapore’s Temasek Holdings.

In a one-paragraph statement, Maybank said “it has indicated to Fullerton, the majority shareholder of BII, of its interest in acquiring its shareholding” in BII.

Maybank said it would make any further announcement at an appropriate time.

BII had on Feb 25 announced that Fullerton had informed of its decision to dispose of its interest in BII in line with Indonesia’s single presence policy.

Fullerton had expected to complete the sale before the regulatory deadline of end-December 2010.

Temasek is looking to sell its BII stake because the Indonesian central bank does not allow foreign investors from owning more than one bank. According to Reuters, Temasek also controls Indonesia’s PT Bank Danamon Tbk.

Fullerton holds 75% stake in BII’s controlling shareholder, Sorak Financial. Sorak, in turn owns 55.78% stake in BII. Reuters said Sorak’s BII stake could be worth about US$1.07bil at the current share price and Temasek’s 75% stake could be worth US$800mil.

BII has over 230 branches and 700 ATMs across Indonesia as well as a banking presence in Mauritius, Mumbai and the Cayman Islands.

In 2004, the Maybank-led consortium (comprising Maybank, Khazanah Nasional Bhd and PT Jaminan Sosial Tenaga Kerja) had failed to acquire a 51% stake in PT Bank Permata Tbk.

Last year, Maybank had signed a memorandum of understanding with Panin Life Tbk to commence discussion to acquire a 60% stake in PT Anugrah Life Insurance, a subsidiary of Panin Life. However, the Indonesian government told Maybank that it was unable to consider the acquisition.