Police to arrest Susno’s lawyer for bribery

The Jakarta Post, Jakarta | Mon, 05/31/2010 10:05 PM

JAKARTA: The police said Monday it had issued a warrant to arrest Johnny Situwanda, a lawyer charged with bribing former detective chief Susno Duadji.

National Police spokesman Brig. Gen. Zainuri Lubis said he has given Johnny a week to surrender before being declared fugitive.

Detectives have received reports that Johnny is currently in Singapore but his lawyer, Sutedja Sugiyono, said his client is in Hong Kong on a business trip.

Sutedja told a press conference that Johnny would fulfill the police’s summons as soon as he arrives back in Indonesia.

Sutedja confirmed Johnny was Susno’s long-time friend but denied the two were complicit in any graft.

Detectives suspected Johnny of bribery case involving his former client Comr. Gen. Susno Duadji, the National Police former chief detective.

Johnny, acting as Susno’s middleman, allegedly transferred Rp 6 billion (US$648,000) to Susno’s bank accounts in 2008 while Susno was chief detective. — JP

Supreme Court says tax office can re-investigate KPC

The Jakarta Post, Jakarta | Mon, 05/31/2010 8:18 PM

The Supreme Court said Monday that the Finance Ministry's tax office still had a chance to re-investigate alleged tax evasion involving East Kalimantan based coal-mining company PT Kaltim Prima Coal (KPC).

Supreme Court spokesman Hatta Ali urged the office to adhere to legal procedures so that the company would have no grounds to complain about the investigation.

In March 2009, KPC filed a complaint with the Jakarta tax tribunal after it received a letter from the tax office saying the company was under investigation. KPC complained that the investigation was not in line with legal procedures.

Hatta said that according to the General Rules on Taxation Law, if the tax office intended to start investigating alleged tax evasion, the office should issue a letter to stop any investigation of suspicious tax reports first.

“We found that the office had issued the warrant to investigate initial evidence of the alleged tax evasion involving KPC before the letter to stop the investigation was issued,” he told reporters at the Supreme Court office in Jakarta.

He said that the warrant was issued on March 4 last year, while the letter to stop investigation of suspicious tax reports was not issued until March 5.

The tax tribunal then ruled in favor of KPC and ordered the tax office to stop investigating the company.

KPC also filed a pretrial suit with the South Jakarta District Court to affirm the tax tribunal ruling.

In response to the company's legal actions, the tax office filed a case review request with the Supreme Court in February this year.

On May 24, the Supreme Court's panel of three justices, Imam Soebechi, Supandi and Paulus E. Lotulung, decided to reject the case review, saying that the tax tribunal ruling had complied with existing laws and the constitution.

“What happened was just procedural error ... The tax office could still investigate the alleged tax evasion,” said Hatta. (rdf)

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New RI finance minister appointment is credit positive: Moody's

The Jakarta Post, Jakarta | Mon, 05/31/2010 5:05 PM

The appointment of Agus Martowardojo, who replaced Sri Mulyani Indrawati, as Indonesia’s finance minister is likely to reinvigorate the improving trend in Indonesia’s sovereign credit profile, Moody's Singapore says.

"This appointment will alleviate the heightened risk of policy gridlock in view of greater-than-expected contentiousness in the relationship between the government and its key coalition partners," it said on Monday.

It added Agus' appointment seemed to represent a stable compromise between the government and its main coalition partners.

"As such, we do not expect key fiscal policies and budget management goals to come under political attack or shift significantly from the credit-supportive positions set by the outgoing finance minister," Moody's said.

It stated that in his 25-year career as a banker and as a reformer of state-owned financial institutions, Agus built a reputation for strong management and personal integrity.

"These credentials will support the prioritization of second-generation reforms to deepen domestic capital markets, improve governance, and heighten transparency and accountability in the public sector," it added.

On account of his familiarity with financial and capital markets, Agus could boost the coordination between the Finance Ministry and Bank Indonesia, the country’s central bank.

Indonesia’s political and financial system and its government finances have come a long way since the 1997-98 Asian financial crisis. Its economy and credit fundamentals have also been resilient to the 2009 global economic crisis and the commodity shocks that preceded it.

These developments have resulted in two sovereign ratings upgrades since October 2007, to Indonesia’s current government bond rating of Ba2 with a stable outlook. The sovereign rating upgrades took place while many skeptics doubted the country’s policy fundamentals and financial stability.

"Against this backdrop, our view is that a deepening of domestic markets and/or a healthier and stable external payments position are key to complementing and sustaining headline improvements in credit ratios, anchoring market confidence, and maintaining the improving trajectory of the sovereign rating," Moody's said.

However, the broader reform thrust has become ensnared in personalized political rivalries, pitting reformists within the government against vested business and political interests, it further stated.

"Therefore, the recent transition at the Finance Ministry will likely ensure policy continuity and efficacy, represent a stable political compromise, and enhance policy coordination between fiscal and monetary authorities," Moody's said.

"These could continue to provide uplift to Indonesia’s credit fundamentals," it added.

Police: Dozens of companies bribed Gayus

The Jakarta Post, Jakarta | Fri, 05/28/2010 9:46 PM

National Police detectives have launched an investigation into dozens of companies for allegedly bribing junior tax officer Gayus HP Tambunan, who has been arrested for his role in a case brokering mafia which also involved law enforcers and judges.

Spokesman for the National Police Insp. Gen. Edward Aritonang said Friday the detectives were working with the Directorate General of Taxation.

“There are dozens of companies now being investigated,” Edward was quoted by kompas.com. He said the police would only name the companies during a media conference on Monday.

He said some of the companies were found to have bribed tax officers to scale down their tax obligations.

The National Police summoned four companies in connection with the tax mafia practice involving Gayus. No suspect has been named in the cases, which have reportedly caused Rp 25 billion (US$2.68 million) in state losses.

RI committed to rainforests protection despite financial constraints

Aditya Suharmoko, The Jakarta Post, Oslo | Thu, 05/27/2010 4:06 PM

Climate talks: Indonesian President Susilo Yudhoyono (left) and Norway's Prime Minister Jens Stoltenberg speak at press conference during the Oslo Climate and Forest Conference in Oslo, Norway, Thursday. The conference was attended by 50 heads of state and environment ministers. –AP/Hakon Mosvold Larsen

Cash-strapped Indonesia remains committed to protection of its rainforests as part of the global initiative to reduce emissions from deforestation and forest degradation (REDD) Plus scheme, President Susilo Bambang Yudhoyono says.

"Working with our developed country partners, we will protect Indonesia’s globally significant carbon- and biodiversity-rich tropical rainforests while helping local populations become more prosperous," Yudhoyono said Thursday in a speech during the opening session of the Oslo Climate and Forest Conference at Holmenkollen Park Hotel Rica in the surrounding hills of Oslo.

The President's statement affirmed his pledge on Wednesday night that Indonesia "would conduct a moratorium for two years where we stop the conversion of peat land and of forests" during a historical agreement signing with Norway, which provides a US$1 billion grant for Indonesia in phases to protect the Southeast Asian nation's forests.

Yudhoyono also said Indonesia would preserve its forests "with or without international help".

But having financial limitations, Yudhoyono expected the REDD Plus scheme to be pushed forward.

"Cancun (meeting in Mexico) must produce a robust and workable decision. In this regard, a decision on REDD Plus could bring about the immediate action that we need to take," he said in the speech.

Indonesia still has a 14.15 percent poverty rate of about 230 million people in population, based on latest data released by the Central Statistics Agency.

In Indonesia, forest areas of a size equaling 300 soccer fields vanish every hour, according to Greenpeace.

Norway's Prime Minister Jens Stoltenberg said based on a March's international conference in Paris about 54 countries agreed to provide $4 billion in commitment to take necessary actions to protect the world's largest rainforests located in Brazil and Indonesia, which function as global "lungs" to transform carbon dioxide into oxygen.

"In today's market forests are more worth dead than alive. We want to change that ... There will be more (incentives) in leaving (them) than cut," he said.

He added that all developing countries should be in the driver's seat to reach the global goals with the help of multilateral institutions like the United Nations and the World Bank.

In his speech at the same forum, Britain’s Prince Charles said the time available to turn the words into actions was "running out". He also praised the agreement signed by Indonesia and Norway.

UN Secretary-General Ban Ki Moon said he would look forward to a successful outcome in the next meeting in Cancun.

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Legislator calls for audit into all regional police chiefs after Susno case

The Jakarta Post | Wed, 05/26/2010 10:01 PM | National

Lawmaker Trimedia Panjaitan said Wednesday the National Police should not only declare whistle-blower Comr. Gen. Susno Duadji a graft suspect, but also audit all regional police chiefs to uncover any embezzlement in the institution.

"There is a budget to do the audit," he said.

The Indonesian Democratic Party of Struggle legislator said Susno's arrest indicated the police wanted to stop Susno from further revealing corruption at the National Police.

Susno has named several high-ranking cops in the National Police headquarters as case-brokers, for which they received millions of rupiah from suspects to help them win their legal battle.

The National Police fought back by detaining Susno, saying the former chief detective also committed corruption in, among others, the arowana fish farm case and a security fund in the West Java gubernatorial election.

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Red Tape Blocks Clean Energy Investment in Indonesia: US

Jakarta Globe, Arti Ekawati, May 26, 2010

US Commerce Secretary Gary Locke, right, and Coordinating Minister for People’s Welfare Agung Laksono, third right, examining tuna ready for export at the Muara Baru Port in Jakarta on Wednesday, the final day of the US official’s trade mission to Indonesia. (JG Photo/Yudhi Sukma Wijaya)

Red tape, conflicting regulations and legal uncertainties keep US companies from investing in clean-energy projects in Indonesia that could help reduce carbon emissions and fight global warming, US Commerce Secretary Gary Locke said during his visit on Wednesday.

Locke said US companies were eager to invest in Indonesia, but a lack of government transparency was a huge obstacle, making it difficult for businesspeople to under stand the country’s regulations.

“As I have discussion with American business leaders, one of the most concerning thing to them is lack of government transparency. They do not know how regulations are implemented or how the government comes up with its decisions,” Locke said at the end of a two-day trade mission to Jakarta.

He said businesses “frequently don’t know what the rules are, how they will be enforced or how decisions are made,” while “bureaucratic bottlenecks” can caused development projects to be delayed for years.

“Especially in the energy sector, where upfront capital investments can be in the hundreds of millions of dollars, this uncertainty has the potential to inhibit foreign corporate investment here,” he said.

Locke arrived in Jakarta with representatives of 10 US companies eager to invest in clean energy, especially in geothermal power plants, solar plants and wind power.

They included General Electric, Lockheed Martin, Osh kosh, Peabody Energy and Pratt & Whitney Power Systems. They met with business leaders and government representatives during the mission.

The trip comes ahead of a visit to Indonesia next month by US President Barack Obama, who is expected to sign a comprehensive partnership with President Susilo Bambang Yudhoyono covering trade, investment and the environment.

Indonesia has enormous potential in geothermal resources, as about 40 percent of the world’s geothermal reserves can be found in the country. So far, only about 4 percent of that potential has been explored.

However, Indonesia is believed to be the world’s third-largest emitter of greenhouse gases, largely because of large-scale deforestation.

Yudhoyono has promised to reduce greenhouse-gas emissions by at least 26 percent by 2020, and 41 percent with foreign assistance. His energy policy calls for increasing the production of renewable energy from 7 percent of generating capacity to 15 percent by 2025, while sharply boosting supply.

Locke said Indonesia had the potential to be a major player in clean energy, and to help the world fight climate change while providing the fuel for the global economy.

He said the world’s demand for energy was expected to double by mid-century. With conventional energy, people needed to build at least two power plants with 1,000 megawatts of capacity every week to meet demand. Therefore new and innovative energy sources were needed.

“This new energy has to be clean to avoid catastrophic climate change and it has to be cheap to keep our economies growing,” he said.

But Locke said Indonesia’s energy and development goals were being undermined by such regulations as the Negative Investment List (DNI), which limits foreign investment in power plants producing less than 10 MW.

“I have been told Indonesia is working to amend this law, and I do hope the government will continue to roll back this and other anticompetitive regulations,” he said.

Last year, Obama signed the Recovery and Reinvestment Act, a stimulus package that includes investment in clean energy of as much as $80 billion.

“Ultimately, all the United States is seeking is a level playing field for its companies, where the cost and quality of their products determine whether or not they win business,” Locke said.

“I have been discussing these and other concerns with my Indonesian counterparts. As you might expect, we do not always agree.”

Indonesian Supreme Court Deals Blow to Tax Office’s Bakrie Probe

The Jakarta Globe, May 26, 2010

A Kaltim Prima Coal mine in East Kalimantan. The tax office says it will continue its probe of the PT Bumi Resources subsidiary. (Supplied Photo)

The Bakrie group has won another round in its tax dispute against the government, with the Supreme Court upholding a ruling that the tax office did not have sufficient evidence to upgrade its probe of a subsidiary to a full investigation.

However, an official at the Finance Ministry’s Directorate General of Taxation vowed to continue the probe of PT Kaltim Prima Coal, a unit of PT Bumi Resources, the country’s largest coal producer.

In a statement on its Web site, the Supreme Court said a three-member panel of judges presided over by Judge Imam Soebechi on Monday had rejected a request for a review of the tax tribunal’s decision in December that the tax office had insufficient evidence to upgrade its probe of KPC, which was alleged to have underpaid its taxes by Rp 1.5 trillion ($160.5 million).

The court has yet to explain the grounds for the ruling.

KPC lawyer Aji Wijaya said the ruling backed the company’s contention that the tax office lacked sufficient evidence.

“Therefore, the tax directorate’s investigation, which is based on their initial evidence, must be stopped,” Aji said.

“This is a good news for all stakeholders of KPC, including investors.”

Shares in Bumi Resources soared on the news, gaining 20 percent on Wednesday.

Elevating an initial tax probe into a full-fledged investigation gives the tax office greater freedom to seize company documents and, recommend a travel ban for company executives and recommend that assets be frozen or seized.

Pontas Pane, interim director of intelligence and investigation at the Directorate General of Taxation, said the ruling would not stop the probe into KPC, and said the Supreme Court’s ruling was based largely on procedures, and was not a judgment of the evidence against KPC.

“It was about a letter to elevate the case into an investigation based on preliminary proof,” Pontas said.

The tax office has been investigating Bumi Resources, KPC and PT Arutmin Indonesia, another Bumi subsidiary, since March 2009 for allegedly evading a combined Rp 2.1 trillion in taxes owed in the 2007 tax year.

The court’s ruling comes as former Finance Minister Sri Mulyani Indrawati departed the country on Wednesday for Washington for a new job at the World Bank.

Sri Mulyani and the Bakrie group’s Aburizal Bakrie have frequently sparred in recent years over the group’s interests. Before she left, she warned that the country’s reforms were in danger of being “hijacked” by vested interests, and said Aburizal, one of Indonesia’s most powerful men, wanted her removed from her post because of her commitment to reforms, according to a newspaper report published on Wednesday.

It was the strongest statement yet from Sri Mulyani following weeks of speculation, which she denied in the report, that her departure was the result of a political deal between President Susilo Bambang Yudhoyono and Aburizal, chairman of the Golkar Party, a member of the government’s coalition.

Eddy OS Hariej, criminal law expert from Gadjah Mada University, said on Wednesday the court’s ruling would not necessarily prevent the tax office from continuing its investigation.

“The investigation process is to find the truth on an alleged criminal act. So the criminal court is the only one to decide whether the proof used is valid or not. At the current stage, the Supreme Court decision has no effect on the investigation,” he said.

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Sri Mulyani takes off to Washington DC

The Jakarta Post, Jakarta | Wed, 05/26/2010 3:56 PM

Until we meet again: Former Finance Minister Sri Mulyani Indrawati (center), accompanied by husband Tonny Sumartono (right), waves to journalists as they depart for Washington DC at Soekarno-Hatta Airport in Tangerang, Banten, on Wednesday. Antara/Ismar Patrizki

Former Finance Minister Sri Mulyani Indrawati is scheduled to leave for Washington DC, USA, on Wednesday afternoon following her new position as managing director in World Bank.

Accompanied by husband Tonny Sumartono, Mulyani left her house in South Jakarta at 11.50 a.m. to Soekarno-Hatta Airport.

Mulyani had a chance to receive a visit from former Finance Minister Mar’ie Muhammad and Director General of Taxation Mochamad Tjiptotardji before leaving her residence.

Mulyani asked the guests and media to support her through prayers, so she could perform well in her new work place.

Starting June 1, Mulyani will be the second-most powerful person after President Robert Zoellick in the World Bank, and will oversee 74 nations in three regions — Latin America and the Caribbean, East Asia and the Pacific, the Middle East and North Africa.

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President to suspend Riau Islands Governor for graft case

Fadli, The Jakarta Post, Batam | Wed, 05/26/2010 4:52 PM

President Susilo Bambang Yudhoyono will sign a letter leading the suspension of Riau Islands Governor Ismeth Abdullah, a declared graft suspect by the Corruption Eradication Commission (KPK).

"After President returns from his trip to Oslo, he will sign the letter," Home Minister Gamawan Fauzi said Wednesday.

Ismeth, who was arrested by KPK on Feb. 22, stood trial in April for a firetruck procurement corruption case.

Gamawan said his ministry did not try to delay Ismeth's suspension.

"The Riau Islands still has a vice governor, thus the government administration is still working," he said.

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Greek crisis will not affect Indonesia: Finance minister

The Jakarta Post, Jakarta | Wed, 05/26/2010 10:52 AM | Business

Newly appointed Finance Minister Agus Martowardojo said in Jakarta on Tuesday that the Greek debt crisis which has caused share prices worldwide to fall would not affect the Indonesian economy.

Speaking to reporters after attending the plenary session of the House of Representatives, the finance minister said that the Indonesian economy remained fundamentally strong despite the significant fall in share prices and the decline in the rupiah against the US dollar in the recent days.

“I’m optimistic, Indonesia can face the financial storm safely thanks to a healthy state budget and the country’s strong cash flow,” he said. Given these encouraging economic factors he said the people need not fear any possible negative impact of the Greek crisis on the Indonesian economy.

President Susilo Bambang Yudhoyono appointed Agus as the finance minister following the resignation of finance minister Sri Mulyani Indrawati last week. She will take up her new job as one of the managing directors of the World Bank.

The President also named Director General of State Budgeting Anny Ratnawati as deputy finance minister.

“There need not be any worries after the recent changes. With my deputy, Ms. Anny Ratnawati — we have looked at internal consolidation. We are optimistic state financial resources and assets can be managed well and in an accountable way,” he said.

Agus said although he had been in his job only for several days, he had already consolidated activities within the ministry to ensure that the changes in the Finance Ministry would not negatively affect the government’s financial plans.

With regard to external factors such as the Greek financial crisis that might cause negative impacts on the Indonesian economy, Agus said that Indonesia had quite different economic conditions from those of Greece and other EU countries.

Indonesia’s debts, for example, accounted for only 28 percent of its Gross Domestic Product (GDP), far lower the debt to GDP ratios of European countries which mostly exceeded 120 percent, he said.

“With these high debt to GDP ratios, the state budget deficits of many European countries could reach 12 percent. This is much higher than 2.1 percent in Indonesia,” he said.

Agus’s presence during the House’s plenary meeting was his first as finance minister. In his first such encounter, Agus seemed relieved at the absence of the interruptions and hostile questions often experienced by his predecessor. Some House members had been hostile to Sri Mulyani due her policy role when the government decided to bail out Bank Century, which they claimed had led to legal violations.

At the meeting, Agus was accompanied by Deputy Minister Anny, secretary-general Mulia P. Nasution, Director General of Debt Management Rahmat Waluyanto, Director General of Treasury Herry Purnomo and several senior officials.

All factions in the House during the plenary meeting accepted the 2011 state budget proposal.

Nevertheless some of the House factions such as the Democratic Party for Struggle (PDI-P) demanded that government make cuts to reduce the proposed budget deficit.

The Golkar Party faction suggested increasing the economic growth target to 6.6 percent from between 6.2 and 6.4 percent, and an increase in the crude oil production lifting assumption from 900,000 barrels per day (bpd) as proposed by the government to 1 million bpd, despite some production problems.

Meanwhile, the United Development Party (PPP) faction asked the government to make concrete efforts to help reduce lending rates in order to help spur economic growth.

The Prosperous Justice Party (PKS) faction asked the government to propose and implement clear programs to reduce poverty and unemployment rates.

Agus is slated to attend another plenary meeting of the House on June 1 to respond the House’s members’ proposals for changes in the state budget bill.

“We are happy because all the factions have agreed to accept the draft budget. So, we will come back to this forum on June 1 to convey the government’s responses,” he said. (ebf)

PGN director suspended over corruption charges

The Jakarta Post, Jakarta | Wed, 05/26/2010 10:42 AM

State gas distributor PT Perusahaan Gas Negara (PGN) has suspended Djoko Pramono, the director for general affairs and human resources development, for his alleged role in cases of corruption and bribery.

“PGN commissioners have suspended Djoko Pramono starting May 21,” PGN corporate secretary Wahid Sutopo said quoted by detik.com.

He said PGN commissioners had issued a letter suspending Djoko, who had been non-active since January 2010 when the corruption eradication commission (KPK) began the investigation into his alleged involvement in the corruption and bribery case also involving PGN’s former president director Washington Mampe Parulian Simanjuntak.

According to Wahid, the commissioners will propose for the dismissal of Djoko in the company’s shareholders meeting, which will be held on June 17. “Finance director Riza Fahlevi will be temporarily take over Djoko’s job,” Wahid told The Jakarta Post.

Djoko has been accused of being involved in graft when he was finance director under Washington’s leadership. During Washington’s trial in June, last year, Djoko testified he had received Rp 1.55 billion from the PGN office in East Java in 2003 to bribe several members of House of Representatives legislators to help the company get the House approval for its initial public offering (IPO).

During the trial, Djoko also said part of the money was given to Washington, who was recently sentenced by the Corruption Court to three-and-a-half years in jail for extortion and bribery in 2003.

In December 2007, Washington and several employees of PGN were fined by the Capital Market Supervisory and Financial Institutions Supervisory Agency (Bapepam-LK) for their involvement in insider trading.

Washington was ordered to pay Rp 2.3 billion in fines, while eight other PGN officials received fines totaling Rp 848 million.

Former BI officials took bribes from RBA: Reports

The Jakarta Post, Jakarta | Wed, 05/26/2010 10:13 AM

Former Bank Indonesia officials received US$1.3 million in bribes from Reserve Bank of Australia (RBA) subsidiaries to help the latter win a contract and manipulate future tenders in 1999, a newspaper reported.

Melbourne’s The Age cited confidential faxes from a Jakarta businessman to executives at Securency International and Note Printing Australia (NPA) referring to “our friends” and “unofficial payments” and “commissions”.

One fax, dated July 1, 1999, specifically stipulates the paying of S1.3 million to two Bank Indonesia officials.

According to The Age, Radius Christianto, who represented the RBA firms Securency and NPA in Indonesia between 1999 and 2006, was to be paid US3.65 million for his services.

In his faxes, Christianto refers to “Mr. S” and “Mr. M”, which the newspaper believes were senior Bank Indonesia officials who played key roles in awarding the RBA firms the contract for printing 500 million Rp 100,000 banknotes.

The revelation of this possible corruption came when a former Securency employee said recently that he was asked to pay bribes and procure prostitutes for foreign central bank officials.

Currently, the Australian Federal Police are investigating Securency for paying more than $A20 million in bribes through middlemen to win currency printing contracts in Vietnam, Nigeria and Malaysia between 2003 and 2006.

Christanto’s correspondence also revealed collusion between Bank Indonesia officials, Christanto and RBA banknote executives to mark up the Securency and NPA bid for the rupiah banknote contract by 20 per cent with an agreement that it would then be reduced to a 10 per cent mark-up.

Bank Indonesia said it would allow the law enforcers to investigate the alleged bribery. “Let the KPK [Corruption Eradication Commission] and the Attorney General’s Office conduct an investigation,” he was quoted as saying by Antara news agency.

“The KPK has not received any official report on the case,” KPK spokesman Johan Budi said Tuesday.

He added that the commission had only just learned of the allegations from Jakarta journalists, so had not had the opportunity to discuss a possible investigation.

“We will process any information on possible corruption as long as it involves state officials,” Johan said.

“The KPK does not work retroactively, therefore we can’t process any case that occurred before

August 1999,” Johan said, adding that the KPK was regulated by the 1999 Corruption Eradication Law, which came into effect in August that year.

The law defines corruption as well as the process for its eradication.

“The KPK also refers to the Criminal Code, which stipulates that a person cannot be charged or tried for any crime occurring before the issuance of any law covering such crimes,” Johan said.

“However, we can investigate these allegations if the case has consequences occurring after 1999.”

It is possible that someone might come forward with information on the case because of the media coverage,” he said, emphasizing that ”we except anonymous reports”. (ipa)

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Anny Ratnawati: Our second iron woman

The Jakarta Post, Jakarta | Tue, 05/25/2010 9:37 AM

JP/RICKY YUDHISTIRA

The strength of a woman can carry the weight of the world, American-born Ukrainian poet and artist Sarah Pezdek-Smith once said.

Indonesia’s former finance minister Sri Mulyani Indrawati, who recently accepted a managing director role at the World Bank, is certainly the living proof of this statement.

Upon Mulyani’s departure from the Finance Ministry, another name popped up to take up the challenge. Anny Ratnawati, a lecturer at the Bogor Agriculture Institute (IPB) previously unknown to the public, shot up like a rising star to be the country’s first deputy finance minister, leaving other candidates crushed with disappointment.

Experts and analysts believe Anny and Mulyani share similarities, even though several economists say Anny’s level of skills and knowledge in the financial sector as well as her ability as a macroeconomic manager are — understandably — below Mulyani’s.

Anny’s friends and fellow lecturers at IPB, who have worked with her for many years, argue the public is not aware of her real potential in macroeconomics and the financial sector.

“Anny’s master’s and doctorate focused on macroeconomics and the financial sector, while her last position in the Finance Ministry was as director general for budgeting. I believe she is the right woman for the position,” IPB rector Herry Suhardiyanto told The Jakarta Post over the phone recently.

Herry further said that Anny’s abilities and Finance Minister Agus Martowardojo’s managerial skills were a perfect combination that would propel the nation forward.

Besides praising her competencies, Herry, who often visits her house in Bogor, also commented favorably on her personality. “Anny is very responsive and smart but at the same time she is also humble and friendly.”

She left a good impression on her students, he went on. Her pupils remember her as a popular and kind person, who often smiles.

IPB professor Didin Damanhuri, who used to work with Anny in the same department at the institute, said, “I often worked alongside Anny in seminar committees. I remember Anny coming across as agile, eager, responsive and very active.”

Forty-eight-years old Anny was one of President Susilo Bambang Yudhoyono’s thesis examiners when he took an agricultural economic doctorate program at the institute in 2004.

Chairman of the House budget committee Harry Azhar Azis, who has seen Anny’s competencies as director general for budgeting, describes her as a straightforward person who stands by her principles.

“I remember there was a hearing to discuss the allocation of Rp 1.5 trillion for the revision of Agriculture Law, conducted between Anny and the House of Representatives Commission IV. She held her stance, and did not let the state budget be used for normative discussion,” he explained.

“However, she shows more flexibility when it is clear that the state budget will be used to invigorate the real sector, and increase people’s welfare,” he said, adding the public could put their trust in someone like Anny to safeguard the state budget from any misuse.

Economist Aviliani of the Institute for Development of Economics and Finance agreed with Harry’s assessment of Anny. “She is truly a master of fiscal and monetary policies, which will be useful for managing the state budget,” Aviliani said.

Despite Anny’s assertiveness as a prominent government official, she is also a wife and a mother of two daughters, who is not ashamed in doing household tasks.

Anny’s private driver, Didin Zaenudin, who lives near his boss’s house in Bogor, said: “I often see her doing household tasks, including sweeping the floor.”

Didin, who has been a driver for a number of high government officials, said he had never come across a high ranking official as humble as Anny.

“For as long as I have been her private driver, I have never driven her to a beauty salon or other places that provide special treatments for ladies,” he said, adding that he only saw his boss wear layers of makeup and a striking or formal outfit when the President inaugurated her.

Didin also told the Post that Anny rarely went to malls or other shopping centers, except to accompany her daughters.

Right now, Anny, who was born in Yogyakarta, Central Java, lives with her husband. Both daughters are currently studying away from home, at universities in East and West Java.

“Sometimes, the girls come home when they have a long vacation,” Didin said.

He added that Anny never thought twice about buying and eating food from street vendors. She loved buying meatballs and Indonesian traditional food, like soto mie, from street vendors close to her house on Sundays.

The humble family also lives in a house devoid of any luxury. In fact, Didin remembers driving straight past Anny’s home the first time he came to pick her up.

“There are a many beautiful flowers in the house as the couple likes gardening,” he said, adding that Anny often spent her time in the garden, looking after her flowers.

Anny usually buys plants from vendors when she passes them, so her collection is hardly an expensive one, he went on.

Besides gardening, Any likes reading. “There are many books in the house,” Didin said.

“I believe my boss’ small family is one of the happiest and most humble [I’ve come across],” He added, while giving the Post the two thumbs up. (rch)

Editorial: Garuda Maps Out New SOE Flight Path

Editorial, Jakarta Globe, May 24, 2010

Garuda is deemed the World's Most Improved Airline (Photo JG)

Indonesia’s state-owned companies seldom win international awards. In fact, we cannot recall the last time a state-owned company won anything at all. So it is especially gratifying that our flagship carrier, Garuda Indonesia, picked up the World’s Most Improved Airline Award, one of 11 categories at the 2010 World Airline Awards in Hamburg.

The awards were presented by Skytrax, a British-based consultancy that conducts research for commercial airlines. It should be particularly pleasing to Garuda that Skytrax based its ratings and awards on surveys of more than 17 million passengers.

Garuda’s success story is now well known, but it did not happen by chance. Under the leadership of Emirsyah Satar, the carrier has undergone a major transformation, overhauling every aspect of its operations. Having bled money for years, the carrier booked a profit of Rp 1 trillion ($108 million) in 2009, and next month it will relaunch its Jakarta-Amsterdam route.

Garuda’s turnaround from a financially indebted company to one that is not only profitable but winning international awards is an example for other state-owned enterprises to emulate. The key is adopting the right mind-set from the beginning that every company, whether private or state-owned, must be profit-driven.

As such, all state-owned companies should be judged on whether they are financially healthy and able to contribute positively to the country’s economic development. This must be the direction for all state-owned enterprises, and no more should they be dependent on handouts from the government. Too many of them are currently operating on handouts with no clear strategy or direction.

It is also important that professional, competent people be hired to manage these companies. We should be past the days when political appointees were installed at the helm of state companies. Now, every CEO of a state-owned company must be held accountable for the bottom line, but also be given the resources to get the job done.

Emirsyah has proven what can be achieved if the right person is put in charge. Highly qualified people with the right experience are worth their weight in gold and should be compensated well, but also be given clear objectives to work toward.

There also needs to be a deeper sense of work ethic and integrity at state-owned companies if they are to fulfill their potential. Employees must be pushed to work hard, but at the same they should be given proper training and motivation. Noneffective employees must be told they no longer will be given an iron rice bowl.

There is an urgent need to change the corporate culture at state-owned companies. They must adopt global best practices, be managed by competent and hard-working leaders and most important, they must generate profits. Garuda has shown the way forward. The other state-owned companies must now take off as well.

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Garuda Indonesia is Awarded World's Most Improved Airline

Agus Martowardojo: Dedicated to work

The Jakarta Post, Jakarta | Mon, 05/24/2010 1:24 PM

Indonesian Finance Minister Agus Dermawan Wintarto Martowardjojo
(JP/Ricky Yudhistira)

When Sri Mulyani Indrawati announced her resignation from the post of finance minister, many Indonesians worried that her shoes would be very hard to fill.

However, Agus Dermawan Wintarto Martowardojo appears to have cleared all doubts by assuring Indonesians he will pursue the Finance Ministry's reform agenda.

"I will make civil servants proud of their corps, and ensure they perform their duties with dedication," said the newly appointed finance minister.

Agus also said he would increase tax collection by registering more taxpayers and creating a healthy business climate to generate more tax revenue.

Will he target tax evaders? "I will learn about them first," he said.

Importantly, he added he would liaise with all stakeholders, including the House of Representatives and non-profit agencies, to gain their support.

We all know Agus for his widely respected skills as a banker. He was born in Amsterdam, the Netherlands, on Jan. 24, 1956. After graduating from University of Indonesia's School of Economics, Jakarta, in 1984, he became an international loan officer at the Bank of America NT & SA.

In 1986, he moved to Bank Niaga, where he was later appointed vice president and the head of the corporate banking group. From 1995 to 1998, he became the president director of Bumiputera Bank and PT Bank Ekspor Impor Indonesia. Agus first joined Bank Mandiri in 1999 as director, and was recently elected for a second term as the president director.

But Agus is more than just a high achieving bank executive, as one may conclude from his impressive curriculum vitae. Although, when asked about Agus' hobby, his driver immediately answered, "Working!"

Tukyo shot to fame for being the first person to congratulate Agus on his new appointment as finance minister. He described Agus as a hard-working person who always kept to his schedule. "Every morning, I will prepare his breakfast, which he will have in the car," the Solo born driver said, adding that during his time at Mandiri, Agus usually worked until two or three in the morning.

"I remember once he even worked until 4.30 a.m.," Tukyo said.

On the other hand, despite Agus' tight schedule, he always has time for his family.

"After coming back from his work, Pak Agus will always greet his family first," said Tukyo, who has now been working for Agus for seven years.

Family is definitely one of Agus' main priorities, with his sons being his main investment. He usually spends his weekends with his family, watching movies or going to the sports club.

"Even though I am always busy, I still have a good quality of life and enough time for my family," said Agus in January 2008, as quoted by SWA magazine. His eldest son, Adri Prasetyo, 24, is now working in Jakarta, while his youngest, Aswin Dwiyanto, 18, is currently studying in Australia.

When interacting with his sons, quality was more important than quantity, he once said. "My sons also get much parental advice from their mother," Agus said.

He believes in teaching them about discipline. "They need to report their monthly spending to me, or I will stop sending them money," he said.

To maintain balance in his life, Agus loves to listen to popular and classical music, read books on management or biographies and watch movies. "I like Harrison Ford and Robert de Niro," he said.

Agus once remarked he had very much been inspired by own father, a state government official who was posted to the Netherlands and the UK.

"My father was a man of high integrity and a dedicated worker, I've observed and learnt from him since I was a child, and I think it was very character building," he said.

Many might not know Agus has a good sense of humor too, Tukyo added.

"Pak Agus likes to joke by startling me when I am not concentrating, for example," the 55-year-old said.

Does the man have any faults? He probably does. Many, for instance, are concerned with Agus' appointment as a finance minister, doubting his ability as a macro-economic manager.

However, Aviliani, an economist at the Institute for Development of Economics and Finance, said Agus had two advantages. First, both the international community and investors knew him well. Second, his vast experience as a banker gave him great insider knowledge on problems in the real sector. "In conclusion, his duet with Anny Ratnawati is the most ideal and the most deserving option," she said.

Meanwhile economist Pande Raja Silalahi warned The Jakarta Post that Agus would probably need time to learn his new role as finance minister.

"The deputy is usually an internal appointment, while the leader comes from the outside. Therefore, I can see there will be a learning process. I believe that Vice President Boediono will play a more active role until the market accepts Agus," he said.

Interestingly, Golkar Party's Ade Komarudin said he regarded Agus as one of the best professionals to replace Mulyani for the job.

Concurring with this view is chief economist of Mandiri Sekuritas Destry Damayanti, one of Mandiri's subsidiaries, who told the Post that Agus' leadership was very prominent. "His concerns about the company's subsidiaries have never been questioned," Destry said.

Agus has also been characterized as responsive, by none other than chairman of the House budget committee, Harry Azhar Azis. Harry recalls a time when he complained to Agus - who was president director of Mandiri at the time - about the lack of Mandiri ATMs in his hometown of Natuna.

"Immediately after our talk, Agus opened an ATM machine and an outlet in Natuna," he said.

The progress made by Bank Mandiri under Agus' leadership are a testament to his good mana-gerial skills, Harry added. "God willing, he could be a good finance minister." (not)

President Susilo Bambang Yudhoyono congratulating Agus Martowardojo, the country’s next finance minister, on Wednesday. Agus is currently president director of PT Bank Mandiri. (Rumgapres Photo)