Asean an engine of growh

The Strait Times, By Yang Huiwen

Mr Jeffrey Immelt (left), chairman and chief executive of General Electric, the largest conglomerate in the United States, said the shape of the global economic recovery is still very much uncertain, but the good news is that Asia has decoupled from the US. --PHOTO: BT

MR JEFFREY Immelt, chairman and chief executive of General Electric, the largest conglomerate in the United States, said the shape of the global economic recovery is still very much uncertain, but the good news is that Asia has decoupled from the US.

'Free money, easy money has always been the elixir to keep the economy in recovery mode' as seen in previous recessions in the US, he said in a speech at a conference hosted by the American Chamber of Commerce held at Raffles Hotel.

'Once interest rates get to zero you can't go much lower than that, which is where we are right now. So the credit can't be liberally applied given the deficits the US has. So the question on the shape of the recovery remains to be seen.'

'There's reason to believe this recovery could look different than those in the past.'

But the 'good news is decoupling really has occured', he said. 'There are economic engines of growth emerging around the world and they are quite exciting and bigger than we thought,' he said citing China and Brazil as examples.

Mr Immelt, 50, who took over the helm from the legendary Jack Welch four days before the 9/11 attack on the US, said companies should position themselves where growth is available, and for GE it means having a greater presence in Asia.

'Probably 10 years ago, if you were to look at one of our strategic plans, we would predict the incredible demise of the Asean region.'

But far from that, Asean could be another engine of growth in the next five to 10 years.

'There's probably one or two meaningful engines of growth that are going to emerge out of the Asean region.'

'(Singapore) is a place where the government really has a vision and really execute on that vision.'

'Our investments in Malaysia have been successful. Five years ago we made some substantial invesmtnets in Vietnam which are proving to be very effective...it's time for us to make a bigger statement in Indonesia and see what happens'.

Mr Immelt said GE is in the process of hiring 1,000 sales people to boost sales in the west and north of China.

'How the Chinese economy does in the short-term is probably more important than sitting there praying for a robust recovery in the US,' he said.

Obama to visit Jakarta en route to APEC: Source

Abdul Khalik, The Jakarta Post, Pittsburgh, Pennsylvania | Fri, 09/25/2009 4:26 PM

Millions of people in Indonesia will end their long wait as US President Barack Obama will visit Jakarta on Nov. 12, albeit only for a stopover before flying to Singapore to attend the APEC meeting a day after.

“The US Embassy in Jakarta has officially submitted a formal proposal for the visit,” an official, who asked for anonymity because he was not authorized to talk with the media, said just before Obama hosted a dinner with G20 leaders, including Indonesian President Susilo Bambang Yudhoyono, during the summit here Thursday.

Another official said Obama would be in his childhood town Jakarta and would spend the night before attending the annual Asia Pacific Economic Forum (APEC), which will be held on Nov. 14-15 in the city state, Singapore.

“The tentative schedule will be a two-day visit in the capital. But it depends on the security situation as it can also be just on the Nov. 12. One thing for sure is that President Obama will meet with President Yudhoyono for a bilateral talk and visit his old school in Menteng, Central Jakarta,” the source said.

Obama spent a few years as a child living in Jakarta from 1967 to 1971 after his mother married an Indonesian man.

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SBY to hold dialogue with 220 US CEOs

Abdul Khalik , The Jakarta Post , Pittsburgh, Pennsylvania, US | Fri, 09/25/2009 3:51 PM | National

President Susilo Bambang Yudhoyono is slated to attend a business forum held by the Indonesian Chamber of Commerce and Industry (Kadin) in Boston on Saturday, with around 220 CEOs from various American companies confirming their presence.

Kadin chairman Mochammad S. Hidayat said in Pittsburgh on Thursday that SBY would address the business forum, focusing on infrastructure development in the country in the coming five years. “The issue is important as we lag behind in infrastructure development,” Hidayat said.

After the president’s speech, a number of CEOs of prominent companies will speak about business climate in Indonesia. The CEOs in attendance will then hold a dialogue with the president.

“The forum will be interesting, given the enthusiasm expressed by the CEOs,” said Hidayat, who is part of the president’s entourage in the G-20 summit in Pittsburgh.

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ADB scales up outlook on Indonesia

Aditya Suharmoko, The Jakarta Post, Jakarta | Wed, 09/23/2009 12:35 PM

The Asian Development Bank (ADB) has upgraded its outlook of Indonesia's economic growth this year to 4.3 percent citing strong private consumption and improving investment.

The ADB previously estimated that Indonesia's economy would grow by 3.6 percent this year.

Indonesia's economic growth is predicted to further expand to 5.4 percent in 2010 due to "the expected modest rebound in global economic growth and stronger world financial markets that underpin growth in external and domestic demand, particularly in promoting further recovery in investment," the ADB said in a report released Tuesday.

Last week the World Bank also scaled up its forecast of Indonesia's economic growth this year to 4.3 percent, saying large spending on the legislative and presidential elections and faster government spending had propelled Indonesia's economy into recovery by mid-2009.

The World Bank previously predicted Indonesia's economy would expand 3.5 percent this year. The 4.3 percent growth forecast is in line with the government's projection of 4.3 percent. The central bank has forecast that the economy will expand close to 4 percent.

The ADB said Indonesia's economy could grow by more than 5.4 percent next year if the government managed to "accelerate its rollout of infrastructure investment by addressing constraints such as legal uncertainties and land acquisition for projects".

The corporate income tax rate, which will be lowered by 3 percentage points to 25 percent next year, will also support investment, the report said.

A leading World Bank economist, William Wallace, said that to spur growth in 2010, Indonesia should spend more on infrastructure and social protection, adding the fiscal stimulus would not be a crucial aspect of Indonesia's economic growth next year.

Next year's fiscal stimulus is estimated to reach Rp 60 trillion (US$6.18 billion), included as part of regular programs at ministries and government agencies, said Anggito Abimanyu, the Finance Ministry's head of fiscal policy.

In comparison, Rp 73.3 trillion has been allocated for a specifically-designated economic stimulus package this year, mainly in the form of tax incentives and infrastructure funds.

The ADB said Indonesia's main threat next year would be much higher than expected world oil prices, which would increase energy subsidies and could force the government to cut public spending.

In the 2010 budget bill, the government provided Rp 8.63 trillion in fiscal risk-cushion funds to protect the budget from increasing oil prices. The Indonesian Crude Price (ICP), Indonesia's benchmark oil price, is set at $65 per barrel. If the price soars 10 percent above $65, the government may raise subsidized fuel prices.

During a working group between the government and the House of Representatives last week, expenditure of the 2010 state budget bill was set at Rp 1,047.67 trillion.

Under article 23 of the bill, the government can add expenditure up to 2 percent, or about Rp 24 trillion, of the total expenditure set for priority spending that has not been specifically allocated in the budget.

Indonesia to make the most of G20 Summit

Erwida Maulia, The Jakarta Post, Jakarta | Sat, 09/19/2009 12:22 PM

President Susilo Bambang Yudhoyono will head to Pittsburgh, United States, next week for the third G20 Leaders Summit, where he is expected to "voice the interests" of developing countries and fight for the forum's permanency.

Presidential spokesman Dino Patti Djalal said Thursday at a press conference that during the Sept. 24-25 meeting of the leaders of the world's 20 biggest economies, Indonesia would voice the interests of developing countries.

He said Indonesia also hoped the summit would not exclude climate change issues in its agenda, with the COP 15 UN Climate Change Conference (UNFCCC) in Copenhagen coming up in December.

"We also want an acceleration in the reforms of multilateral institutions such as the IMF and the World Bank," Dino said.

"The process is ongoing, but we want it to be accelerated.

"And Indonesia wants the G20 to explore other issues such as aid effectiveness and food and energy security," he added.

"These are important things for Indonesia."

Dino said the summit would follow up on the results of the previous two meetings, including on multilateral banks' reforms and financial sector reforms, including the changing of the financial stability forum into the financial stability board.

"The G20 leaders are also expected to make a stronger base for the global economic recovery and global economic activities in the future, to make the world economy more sustainable, and to take social issues into consideration," Dino said.

He added Indonesia would also fight for the G20 forum to be made permanent and institutionalized, with members still arguing over which forum to grant permanency to: the G8, G14 or the G20.

"The economic landscape has now changed. The global economic growth is now boosted not by the US or Europe, but by Asia; by India, China, as well as Indonesia," Dino said.

"It is a heated debate. We hope the direction will be clearer in Pittsburgh."

During the trip, Yudhoyono will hold bilateral talks with new Japanese Prime Minister Yukio Hatoyama and Australian PM Kevin Rudd.

After three days in Pittsburgh, the President will be in Boston from Sept. 26 to 29, during which he will meet with CEOs of 200 companies, speak on "Harmony of Civilization" at Harvard University, and greet Indonesian students and citizens living in the city.

Yudhoyono will be accompanied by a handful of Cabinet ministers.

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Moody's raises RI's debt rating

Aditya Suharmoko, The Jakarta Post, Jakarta | Thu, 09/17/2009 2:35 PM

Indonesia's foreign and local currency sovereign debt rating has been upgraded from Ba3 to Ba2 by Moody's Investors Service as the economy remains resilient despite the global economic slowdown.

"The upgrade was prompted by the Indonesian economy's relatively strong resilience to the global recession as well as its healthy medium-term growth prospects," Aninda Mitra, Moody's vice president and sovereign analyst for Indonesia, said in an statement Wednesday.

"An upswing in economic activity to its recent rate of 5.5 percent is expected to remain in 2010 and Indonesia's overall dynamic growth is better positioned to face medium-term global uncertainties than many of its Ba-rated peers, as well as most regional economies," he said.

"Indonesia's macroeconomic management is also improving and its appropriate policy stance is expected to persist in the foreseeable future," he added. "These developments highlight the growing credibility and predictability of government policies and are expected to ensure macroeconomic stability."

Moody's last rating of Indonesia was taken on June 11, when the outlook on the Ba3 sovereign rating was changed to positive.

The economy grew by 4.2 percent in the first half of this year as compared to the same period in 2008, according to the Central Statistics Agency (BPS). The government expects the economy to grow by 4.3 percent this year.

Similarly, the World Bank on Tuesday revised its growth forecast for Indonesia's economy from 3.5 to 4.3 percent.

Rahmat Waluyanto, the Finance Ministry's director general of debt management, welcomed the good news, saying the upgrade was an acknowledgement of the success of the fiscal and monetary authorities in safeguarding the economy from the negative impacts of the economic crisis.

"Our cost of funds will be lower as risk premiums asked by bond investors and foreign debt creditors will drop," he said. "It is expected that bank lending rates will also decline."

Lower lending rates may prompt businesses to start borrowing money for expansion, which will eventually spur growth.

Finance Minister Sri Mulyani Indrawati said if investment grew by between 3 and 4 percent in the third quarter this year as expected by the government, it would help to fuel growth.

"If that can be done, then there are already signs of economic recovery," she said. "We expect private consumption to remain strong and high, while investment will show signs of recovery, particularly supported by the global economic recovery and the positive sentiment in the stock market and government and corporate bonds."

The rupiah rose to an 11-month high, while stocks and bonds gained, after Moody's raised Indonesia's credit rating, Bloomberg reported.

The rupiah strengthened 2.3 percent to 9,695 per dollar at 4:15 p.m. in Jakarta, the strongest level since Oct. 15 last year. It was the biggest one-day gain since the 2.4 percent rise on April 30.

Meanwhile, the Jakarta Composite Index gained 0.8 percent to 2,439.35.

Moody's has also upgraded Indonesia's foreign currency country ceiling to Ba1 and the foreign currency bank deposit ceiling to Ba3. The outlook on these is stable.

SBY calls on world to combat terrorism together

Erwida Maulia, The Jakarta Post, Jakarta | Thu, 09/17/2009 10:27 PM

New face: National Police spokesman Insp. Gen. Nanan Sukarna displays the picture of most wanted terror suspect Noordin M. Top, who was killed in a raid in Central Java on Thursday. The police announced on Saturday a DNA test confirmed Noordin’s death. – JP/Wendra Ajistyatama

President Susilo Bambang Yudhoyono appreciated the National Police on Thursday for its endless fight against terrorism, but underlined that concerted efforts among nations across the world would be needed to eliminate acts of terror.

Yudhoyono said the root cause of terrorism was a sense of injustice felt in some parts of the globe.

"There is a perception, a feeling; that the world looks unfair, that the rich are getting richer and the poor are getting poor... the wars in the Middle East; in Afghanistan, Iraq, Palestine and many other global problems are seen as a result of global injustice," the President said during a breaking of the fast dinner with journalists at the Presidential Palace.

"The solution is we have to build a just, peaceful and prosperous world. We hope that people will lend a hand to those in troubles, and that there will be a solution to halt wars in the Middle East," he added.

Other root causes, Yudhoyono said, were poverty, underdevelopment as well as radical and extremist beliefs.

The President thanked the police for conducting their duty to enforce law and protect the nation from terrorism threat.

Earlier in the day the counter-terror squad stormed into a hideout of suspected terrorists in Surakarta in Central Java, killing four people, including top Al-Qaeda-linked fugitive Noordin M. Top.

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Skies are Clearing for Indonesia, as Global Crisis Winds Down

Domestic consumption propelled Indonesia into recovery by mid-2009, says latest World Bank analysis. Economic growth is forecast to be 4.3 percent this year.

World Bank

Available in: Bahasa (Indonesian)

Jakarta, September 14, 2009 – While most of the world is only now beginning to recover from the global financial crisis, Indonesia’s recovery began at the start of the year.. Domestic consumption in Indonesia remained robust, thanks to election campaign-related spending and an improving trade performance. According to the latest Indonesia Economic Quarterly, released today, government spending should support the economy through the rest of the year.

“Because of Indonesia’s strong reform record and its robust economy leading into the crisis, its large and dynamic domestic market, and very effective and timely actions by the Government and BI,Indonesia has been the least affected by the global financial crisis among all major economies,” said Joachim von Amsberg, World Bank Country Director for Indonesia. “These factors have allowed Indonesia to weather the storm and could support a quicker recovery than in other countries.”

Indonesia Economic Quarterly: Clearing Skies reports that Indonesia’s recovery coincided with an improved external environment. Most of Indonesia’s major export destinations had exited recession by mid-year, while international prices of Indonesia’s exports had also recovered from their late 2008 falls. The quarterly report also finds that:

• The banking sector proved far more robust than many commentators expected, although bankers are making fewer new loans.
• Financial markets continued strengthening through mid-2009, allowing the government to continue financing its budget through the bond market.
• Indonesia’s external position remains robust. External debt was largely rolled over through the first half of 2009, and portfolio investors returned to Indonesian markets, leaving the balance of payments in a small surplus and reserves higher.
• Inflation reached its low point in August, after being more subdued than expected earlier in the year. But inflation remains higher in Indonesia’s than across its trading partners.
• Employment grew by more than the working age population, although most new jobs were informal, especially for women.
• Public finances were more stimulatory than in recent years. Through to July, the government budget overall was in deficit, whereas normally it is in surplus in the first semester.
• The realized budget deficit is likely to be smaller than originally budgeted, near 2.2 percent of GDP. The government’s proposed 2010 budget projects a deficit of 1.6 percent of GDP.

“We expect the mid-2009 trend of gradual recovery to continue over the coming year and a half. Domestic demand is likely to continue as the main driver of growth, as the government continues to disburse its fiscal stimulus and, in 2010, investors regain confidence,” said World Bank Senior Economist, Shubham Chaudhuri, who was one of the key authors of the new quarterly.

The World Bank expects Indonesia’s economy to expand by 4.3 percent in 2009, slowly accelerating to 5.4 percent in 2010, a stronger outlook since than the last Quarterly. Inflation is expected to slowly rise over the coming months to average 4.7 per cent 1this year and 5.6 percent next. These developments, and the end of the government’s BLT (unconditional cash transfer) program are likely to slow the recent gains in poverty reduction. And while the skies appear to be clearing for Indonesia, significant clouds remain on the horizon, especially from the global economy.

World Bank Office Jakarta
Indonesia Stock Exchange Building
Tower 2, 12th Floor (62-21-5299-3000)

Contact:

In Washington DC: Mohamad Al-Arief
(1-202) 458-5964, malarief@worldbank.org

In Jakarta:Randy Salim: (62-21) 5299-3259
rsalim1@worldbank.org

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Report : Indonesia Economic Update (Sept 2009: Clearing Skies)

A Muslim model

What Indonesia can teach the world

Globe Correspondent, by Joshua Kurlantzick, September 13, 2009

Youngsters study the Koran at a pesantren, or Islamic boarding school, in Indonesia. (Dimas Ardian/Getty Images)

At times this summer, much of the Muslim world seemed at war with itself. In Iran, protesters furious over what they viewed as a stolen election spilled into the streets and were met with a brutal security crackdown. In Pakistan, powerful Taliban-type militant groups battled the army. In neighboring Afghanistan, opposition leader Abdullah Abdullah and local tribal leaders accused President Hamid Karzai of stealing the national election.

Farther south, the world’s largest Muslim nation, Indonesia, received far less attention. Yet what happened there in July ultimately could prove far more important than the meltdowns in Afghanistan or Pakistan or Iran. Some 100 million Indonesians, spread across a vast archipelago, went to the polls, and in a free and fair vote, they reelected president Susilo Bambang Yudhoyono, leader of the secular Democrat Party. Hard-line Islamic parties fielded candidates as well, but they barely registered at the polls, gaining less of the vote than they had in the previous national election five years ago.

Yudhoyono’s reelection was only the capstone of a triumphant decade for Indonesia. Despite its vast size and remote terrain - it is the world’s fourth-largest nation by population, its 240 million people spread across thousands of islands between the Indian Ocean and the Pacific - Indonesia has become a rock of political stability in a turbulent region. After decades of military dictatorship, and the threat of Islamism in the late 1990s, Indonesia is today ruled by a coalition that mixes secular and moderate Islamic parties and protects minority rights. And at a time when countries from Japan to Singapore are struggling, Indonesia posted some of the strongest growth in Asia this year. The nation’s occasional terrorist attacks haven’t succeeded in destabilizing the government, which has steadily built a reputation for good governance and an effective battle against militant groups.

“If you want to know whether Islam, democracy, modernity and women’s rights can coexist, go to Indonesia,” Secretary of State Hillary Clinton said on a trip to Southeast Asia earlier this year.

Though Indonesian leaders themselves are hesitant to lecture other countries, their model could offer lessons for nations from Pakistan to Morocco. It has managed to create a stable political system without using its military to guarantee secular rule, as does Turkey. The militant Islamic groups that once seemed to threaten the country’s future have been crushed or co-opted. And it has adopted modern anti-terrorism techniques that appear to be working. In its success, Indonesia also offers the United States, constantly seeking ways to help build stable societies in the Arab-Muslim world, a model for cooperation and moderation.

Read whole story ....

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WB: Indonesia - The Most Active Reformer

Worldbank

Available in: Bahasa (Indonesian)

• Latest Doing Business report recognizes Indonesia as the region’s most active reformer of business regulations in 2008-2009.
  
  
• Time it takes to start up a new business has gone from 76 to 60 days -- a significant drop from the 100 days it took just three years ago.
  
  
• Indonesia’s Investment Coordination Board (BKPM) pledges to focus on reforming Companies Law and SME registration.
  
  

Jakarta, September 9, 2009 – A nice little ‘birthday gift’ for the Indonesian president who happens to turn 60 today: global recognition of the fact that it is getting easier to do business in Indonesia. Doing Business 2010: Reforming through Difficult Times – the seventh installment in a series of annual reports from the World Bank Group – recognizes Indonesia as the region’s most active reformer of business regulations in 2008-2009, and has accordingly bumped up its ranking from 129 to 122. Local businesses and entrepreneurs are now enjoying a relatively more enabling environment: the time it takes to start up a new business has gone from 76 to 60 days, marking a significant drop from the 100 days it took just three years ago. Other positive reforms include the time it takes to transfer property, which has dropped from 39 to 22 days, as well as the fact that investors now enjoy greater protection thanks to stronger disclosure requirements for related-party transactions. These reforms become particularly impressive once one takes into account that they were carried out during the height of the global economic crisis, and that Indonesia itself has managed to maintain positive economic growth during this difficult period for most of the world.

Muhammad Luthfi, who leads Indonesia’s Investment Coordination Board (BKPM), was on hand for the report’s launch event and announced concrete steps to take business reforms even further. Luthfi says Indonesia would not be able to make any significant improvements on the Doing Business index so long as Law No.40/2007 on Companies remains as it is. The existing law enforces a minimum capital requirement to start up a business, which essentially negates the very point of starting a business. Luthfi highlights that such requirements are not imposed by governments of such neighboring countries as Singapore and Malaysia. Singapore, in fact, ranks number 1 in this year’s Doing Business index.

“I will personally write a letter to the President explaining that this law is very disruptive,” said Luthfi in a joint press conference after the launch. Luthfi hopes that the issue of Law No.40/2007 will become part of the President’s first 100-day work agenda.

Lutfi is also intent on improving conditions for small medium enterprises. At present, some 60 percent of all SMEs in Indonesia remain unregistered, and are denied the opportunity to flourish as legal entities. The process for SME registration is still riddled with red tape and can cost entrepreneurs anywhere between 5-13 million rupiah (500-1,300 USD). Lutfi envisions a simpler registration process which guarantees entrepreneurs official notary documents, a tax card, and funding from commercial banks. “That way, small businesses have the opportunity to grow into medium and eventually large businesses,” he said.

Related Content

Press Release

Doing Business 2010: Indonesia the Most Active Business Regulatory Reformer in East Asia and the Pacific in 2008/2009

Website

Doing Business

Indonesia Economy in DB 2010

Govt prepares Rp 1.4t for post-quake programs

Erwida Maulia , The Jakarta Post , Bogor, West Java | Mon, 09/07/2009 5:32 PM

The government said Monday it would allocate Rp 1.4 trillion (US$140million) for rehabilitation and reconstruction programs after a powerful quake rattled West Java last week.

Coordinating Minister for the People's Welfare Aburizal Bakrie told a press conference in Bogor, West Java, on Monday, that the money would be taken from the 2009 state budget's reserve funds because funds allocated for disaster management had already been used to deal with other catastrophes earlier in the year.

"We will soon verify how many buildings have been destroyed and how much damage has been done. After that we hope we can immediately begin the reconstruction," Aburizal said after a Cabinet meeting with President Susilo Bambang Yudhoyono.

"We estimate that the cost will amount to between Rp 1.4 trillion and Rp 1.5 trillion. We hope the reconstruction will be completed by the end of February 2010," he added.

Aburizal said that the 7.3-magnitude quake, centered off the coast of Tasikmalaya, West Java, had affected 14 towns and regencies, killed 73 people and wounded hundreds of others.

He said the government would manage the reconstruction program similar to how it dealt with the aftermath of a major earthquake that hit Yogyakarta in 2006.

G20: Indonesia: Exit Strategy Now Would Dent Optimism

The Wall Street Journal

The finance ministers agreed to continue with economic stimulus plans

LONDON (Dow Jones)--The Group of 20 industrialized and developing countries must carefully time exit strategies from stimulus policies as premature actions would dent global market optimism, Indonesia Finance Minister Sri Mulyani Indrawati warned Friday.

Speaking in London ahead of this weekend's gathering of G20 finance ministers and central bankers, Mulyani said Indonesia was in a relatively strong fiscal position, making its exit strategy less of a concern.

However, she cautioned that the G20 should adopt a coordinated approach to avoid adversely affecting the global recovery.

"It (an early exit) would create a counterproductive effect psychologically for the market and it could prolong the recession," she said.

Mulyani said she believed there was recognition within the G20 that action needs to be taken over the issue of bankers' remuneration, but said the matter needed to addressed in a balanced way.

"The question is how specific and how stringent the regulation should be," she said. "It needs to be balanced to give room for the (finance) industry to grow in a healthy and responsible way."

Mulyani said in addition to discussions on exit policies on bankers' remuneration, she hoped the G20 would discuss the design of a new global economic model.

"It is about how are we going to design this new equilibrium that will be more sustainable and will not lead to excessively risky behavior."

Mulyani said the new economic growth model would also address issues surrounding climate change, but added that she was unsure whether this weekend's meeting would specifically look at climate change.

-By Ainsley Thomson, Dow Jones Newswires; 44 20 7842 9318, ainsley.thomson@dowjones.com

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Foreign aid for quake victims not yet necessary: President

The Jakarta Post, Jakarta | Thu, 09/03/2009 10:21 PM

President Susilo Bambang Yudhoyono said on Thursday international aid was not yet urgent for survivors of the 7.3-magnitude earthquake, which has left over 25,000 houses in Tasikmalaya and its West Java neighboring towns damaged.

The President said Indonesia remained capable of handling the impacts of the natural disaster.

“So far, the government has managed to cope with the impacts of the quake using national resources,” the President said on the sidelines of his visit to Babakan Caringin hamlet in the village of Cikangkareng, Cianjur, one of the areas hit hardest by the quake.

Australia and Japan have offered to help the Indonesian government mitigate the disaster.

The President said the local government would lead the post-disaster rehabilitation efforts with the central government’s assistance.

He said the central government would extend Rp 5 billion in financial aid for the quick emergency response work, excluding humanitarian assistance. The government, he added, would also help survivors rebuild their houses.

Deputy West Java Governor Dede Yusuf said the disaster had killed 54 people, injured 147 others, ruined 34 houses and damaged 26,000 houses.

First Lady Ani Yudhoyono, vice president-elect Boediono and a number of ministers accompanied the President during the visit.

President instructs West Java governor, Tasikmalaya regent to be alert after earthquake

The Jakarta Post, Jakarta | Wed, 09/02/2009 4:30 PM

President Susilo Bambang Yudhoyono instructed West Java Governor Ahmad Heryawan and Tasikmalaya Regent Tatang Farhanul Hakim to get ready with necessary measures after a 7.3-magnitude earthquake jolted the province on Wednesday.

State Secretary Hatta Radjasa said he received a call from the President who gave the instruction, Antara reported.

Hatta said the central government had not yet been able to communicate with the West Java administration to check for any damages or casualties.

The earthquake was centered 138 kilometers southwest of Tasikmalaya and 38 kilometers beneath the seabed. Residents in Jakarta and Yogyakarta have also felt the tremor.

The world's largest economies have economic growth

PMNY Business Investment Examiner, Sahit Muja, August 31, 11:33

China's government has turned around its economy far faster than most thought possible, to 7.9% in the second quarter.Even if the surge moderates in coming quarters, many analysts say China will very nearly meet its target of an 8% expansion for all of 2009. In the first quarter, gross domestic product grew 6.1% from a year earlier.Property sales were up 53% in the first six months from a year earlier, according to a survey commissioned by the statistics bureau and published in the China Information News, while nationwide prices averaged across 70 cities climbed year on year in June. This masks the fact that in second and third cities prices have been strengthening much more. Property normally accounts for about 25% of fixed asset investment in China and is a key form of wealth holding for most Chinese

Japan world's second largest economy returning to positive growth. Japan's economy has grown for the first time in more than a year. Climbing out of its worst recession in decades thanks to rebounding exports and government stimulus measures, data showed today.

The world's second largest economy expanded by 0.9 percent in the three months to June from the previous quarter, returning to positive growth for the first time in five quarters, the government reported.

Japan's gross domestic product grew at an annualised pace of 3.7 percent in April-June, the Cabinet Office said Optimism about housing prices will translate into greater consumer confidence.European economist forecasts the euro area will grow at least 0.3 percent in the current quarter. Reading in Germany shows that the domestic economy is improving beyond just the car sector, and France’s economy is also progressing.

Germany's economy returned to growth in the spring.Estimates of gross domestic product for the second quarter confirmed Tuesday.The latest figures showed German exports had grown at their fastest pace for nearly three years at 7%, with particularly strong growth in demand from rapidly-growing economies such as China. GDP rose 0.3% on a quarter-to-quarter basis in the April-June period, after a drop of 3.5% in the previous three months, data from the Federal Statistics Office.

French GDP also grew by 0.3% in the second quarter.

Brazil's economy grew 5.1 percent despite impacts of the global financial crisis, and it had a tough economic time early this year. The Brazilian government, however, introduced a package of measures to prop up the real estate and automobile industries, in an effort to promote employment and increase the domestic demand.

Australian economy has performed better than expected in the current economic climate. Australian economy defied the global recession.The economic reforms carried out by the Australian government have played a significant role in the development of the Australia economy. Previously Australia was regulated and protected by tight rules charters, but by reducing high tariffs, opening the financial services sector, making the labor markets more flexible, reforming the tax system and privatizing government companies the conditions for the current boom have been created.

Indonesia still had the fastest-growing economy in Southeast Asia, with improving prices for the country`s key export commodities and a robust domestic market credited for the good result.

The country`s gross domestic product growth of 4 percent in the second quarter placed Indonesia among the top three fastest growing economies in Asia.

Most of the growth in Indonesia came from the resilient domestic economy, which accounted for about 60 percent of the figure. However, the 4 percent gain from April to June was lower than the 4.4 percent growth posted in the first quarter of the year, a sign that the global economic slump is taking its toll here, primarily on the nation`s export sector.

Prices of the country`s main exports such as oil and gas, and commodities like mined metals, coal and crude palm oil have improved in the past few months.

RI migrant workers` remittances Rp100 trillion per year

Antara News, Tuesday, September 1, 2009 05:40 WIB

Banten (ANTARA News) - Some six million Indonesian migrant workers abroad are sending a total of about Rp100 trillion home a year, making them the country`s second largest foreign exchange earner after oil and gas, a manpower official said.

"That much of money reaches home partly through banks, and partly when the workers return home," Jumhur Hidayat, head of the National Agency for the Placement and Protection of Migrant Workers (BNP2TKI), said here Monday night.

Speaking in a dialog with members of Serang`s manpower recruitment community, he said migrant workers were doing a great service to their country because they helped to reduce unemployment, each of them was providing a living for an average of five family members, and having a "multiplier effect" on regional development.

Their remittances were creating bases for the growth of entrepreneurship in their places of birth or origin.

"Therefore, they deserve to be called one of the country`s prime earners of foreign exchange. Their annual monetary contibutions combined are second only to the country`s earnings from oil and gas exports," Hidayat said.

Consequently, according to Hidayat, the government and all parties concerned should treat migrant workers with high respect, from the time they depart, while they are working abroad until they return home.

"The services to and protection of migrant workers should not only be good but excellent," Hidayat said.

Hidayat came to Serang as part of a so-called Ramadhan (Muslim fasting month) safari or tour of the provinces.

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Thousands of migrant workers stranded overseas

Indonesia Eximbank launched to boost exports

Aditya Suharmoko, The Jakarta Post, Jakarta | Tue, 09/01/2009 2:22 PM

Mahendra Siregar, chairman of Indonesia Eximbank’s board of directors, Finance Minister Sri Mulyani Indrawati and Trade Minister Marie Elka Pangestu talk at the official launch of the Indonesia Eximbank in Jakarta on Tuesday. (JP/R. Berto Wedhatama)

The government has officially launched the Indonesia Eximbank, an agency to help finance exports, particularly by micro-, small- and medium-sized enterprises (MSMEs).

Indonesia Eximbank will boost the number of exporters, which have difficulty securing financing from other financial institutions, Trade Minister Mari Elka Pangestu said Tuesday after the launch ceremony.

"We will identify potential exporters," she said.

Finance Minister Sri Mulyani Indrawati said she expected Indonesia Eximbank to help diversify exports to new destination markets.

The Middle East, Russia, Kazakhstan and Uzbekistan are among the new destination export markets, Mari said.

RI commits $2.5b for trade finance

Aditya Suharmoko, The Jakarta Post, Jakarta | Tue, 09/01/2009 2:26 PM

Indonesia will commit to providing US$2.5 billion to increase trade finance and help the global trade recovery during the G20 meeting later this week, Finance Minister Sri Mulyani Indrawati says.

The total commitment is expected to be raised to $400 billion, up from $250 billion, during the meeting, ahead of the G20 summit in Pittsburgh from Sept. 24 to 25.

"With a turnover assumption of four times in two years, the [$2.5 billion] commitment will become about $10 billion," Mulyani said.

The money will be taken from the central bank's ($590 million), the government ($600 million), loans from the Japan Bank for International Cooperation or JBIC ($500 million) and state-run lenders Bank Mandiri, BRI and BNI ($830 million).

Curtail of power a blessing for President Yudhoyono

Monday, August 31, 2009 00:51 WIB

Jakarta (ANTARA News) - President Susilo Bambang Yudhoyono said that the power of the president nowadays was smaller than that of the previous presidents but this was a blessing for him.

"In the past, a president was very powerful. Through the amendment of the Constitution for four times, the president`s power has significantly been curtailed. But for me, the significantly reduced power is a blessing because I cannot be seduced to abuse power," President Yudhoyono said here on Sunday.

The president made the statement at a fast-breaking function with members of the Regional Representatives Council (DPD) at the residence of DPD Chairman Ginandjar Kartasasmita.

On the occasion, the president asked the DPD members to increase their roles in carrying out supervision as well as the check and balances in the nation`s life.

"There should be no absolute power in this country. If the power is absolute it would disturb the check and balances process and could lead to making mistakes," the president said.

He said that the power of the president at present was not unlimited so that it could be used well.

On the occasion, the president said that efforts to seek a better form of democracy must continue to be made.

"If in this country there are many forms of Constitutions it is in line with efforts to seek the most appropriate form of democratic life," he added.

He said that efforts to seek a form of democracy in Indonesia would continue in accordance with the challenges of time.