An Overdue Warning on Misuse of Budgets

Jakarta Globe, August 05, 2010

President Susilo Bambang Yudhoyono has issued the strongest warning to date against the increasing abuse of central and provincial budgets by regional politicians.

Regional governments can be important partners
in national development. But they need to accept
their responsibilities and fulfill the aspirations of
those who elected them.

Yesterday, the president gathered his ministers, governors and provincial legislative heads in Bogor in the third such event since he reassumed the presidency for a second term, and told them in no uncertain terms that he will not tolerate any misuse of national and regional budgets.

In his opening speech at the two-day meeting at the Bogor Palace, Yudhoyono warned that all budget usage would be evaluated by the government, mainly by the Presidential Working Unit for Supervision and Control (UKP4), and would be open for public scrutiny. Such transparency is long overdue and much needed.

The meeting focused on four topics — the macro economy, the state budget, regional budgets and budget acceleration. These are critical in accelerating economic growth and we applaud the president for displaying leadership on these issues.

Sadly, both the central and local legislators seem to have lost their way, using state funds for frivolous projects — often in the face of widespread public objection — instead of building infrastructure that will improve the lives of the people.

The state audit board recently found that most regional budgets have not been used to try to increase prosperity among the people, but rather to cater to the desires of officials for personal housing, offices and vehicles.

And the country has seen a steady stream of regional officials and legislators being dragged to justice, facing corruption charges linked to the misuse of budgets.

It is vitally important for the government at all levels to exercise fiscal discipline.

Understanding and the proper management of state budgets are important tools of economic growth and the enhancement of the quality of life across the country.

If used prudently and with maximum effect, state funds can drive growth and development across Indonesia, especially in rural and less-developed regions.

Such funds should be used to build roads, bridges, irrigation channels, schools, hospitals, ports, power plants and train stations.

They should be wisely used to fund projects that would benefit the people and help empower them, instead of being squandered on vanity projects.

Regional governments can be important partners in national development.

But they need to accept their responsibilities and fulfill the aspirations of those who elected them.

The president also asked his ministers and local administrations to react quickly to any abnormal hike in the price of essentials in the run-up to the Ramadan fasting month, a season traditionally marked by high consumption and skyrocketing prices.

One of the essences of good government is a synergy between the central government and regional administrations.

The two-day forum initiated by the president is an important start to this process.

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Judicial Commission received over 7,000 reports from public

Antara News, Saturday, May 8, 2010 02:55 WIB | National

Jakarta (ANTARA News) - The Judicial Commission (KY) has so far received 7,450 reports from the public on suspicious prosecution processes with indications of unlawful dealings, KY Head M Busyro Muqoddas said.

"We have received 7,450 reports from the public in 33 provinces," the KY chief told a seminar on law enforcement in Indonesia here on Friday.

Busyro also said the number of reports from the public did not show a downward trend but continued to increase from year to year.

For this purpose, he said, KY should be given more authority based on stipulations contained in the 1945 Constitution.

"KY is different from other state institutions because its existence is sanctioned by the Constitution so that its position is equal to other higher state organs such as the State Audit Board (BPK)," he said.

The YK chief also explained that when the commission was just established it mapped out the force of judges in the country and took stock of various problems that had occurred with regard to the judicial process.

As a follow up of its initial steps, he said, the YK had submitted a proposal which among others asked the Supreme Court to restructure its judges. The proposal was however rejected.

SBY Fires At Fresh Targets in Graft War

Jakarta Globe, Camelia Pasandaran, May 05, 2010

President Susilo Bambang Yudhoyono has hit out at government officials, including the police, for charging businesses and investors “illegal fees.” (Bloomberg Photo/Ian Waldie)

Politicians should quit interfering with police and prosecutors, and regional governments must stop charging businesses and investors “illegal fees,” President Susilo Bambang Yudhoyono warned on Tuesday as he broadened the scope of antigraft offensive.

Saying he had received more than three million text messages and letters from people demanding action on graft, he said he felt called upon to act personally. “They’ve met a dead end and then can only report it to the president and the first lady,” he said.

Speaking at the start of a cabinet meeting on law enforcement, he dwelt first on politics. “We need to prevent political intervention in law enforcement. I call on politicians in this country, both in the executive and legislative branches, to respect the authority and independence of law enforcement.”

Interference undermined the rule of law through conflicts of interest that led to criminal behavior and corruption, he said.

He then took aim at fees that regional governments charge through bylaws and other means aimed at extracting money from investors. “I have received complaints from investors, both foreign and local,” Yudhoyono said.

“Because of illegal fees, overhead costs are too high. Later, these fees are counted as operational costs and that makes products and services more expensive. The people suffer from this.”

Investors have long complained that decentralization has seen regional governments charging hefty administrative fees and other levies on businesses counter to central government policies.

The president cited Home Affairs Ministry data showing that over 1,000 regional bylaws related to fees have been annulled in recent years. Home Affairs Minister Gamawan Fauzi promised to force district heads and governors to comply. “One-stop shop” issuing of permits and licenses by provincial governments would help end bogus fees, he said.

In his comments on political meddling in law enforcement, Yudhoyono said “money politics” was at the root of wrong doing. “The key is for politicians to stay away from the legal field and law enforcers from politics,” he said.

While he named no names, his remarks evoked recent Prosperous Justice Party (PKS) statements that it would defend North Sumatra Governor Syamsul Arifin, who refused to step down last month despite being charged with embezzlement.

In addition, Democratic Party lawmaker Daday Hudaya last month called on investigators to suspend a probe into a Papua district head who has been linked to a Rp 49 billion ($54 million) graft case, leading to charges that the president’s own party was acting on behalf of corporate interests.

PKS lawmaker Fachry Hamzah insisted the House never intervened in law enforcement. “[But] criticizing the government and law enforcement is part of a lawmaker’s duties. We’re being paid to speak out,” Fachry said, adding that intervening in a legal process is the sole prerogative of the executive branch.

Asked if there was clear evidence of politicians meddling in legal matters, Minister of Justice and Human Rights Patrialis Akbar declined comment. “These remarks were only to remind us,” he said. “Whether there is evidence, you journalists know better.”

The whistle blower seeking his roots` support

Antara News, Thursday, April 29, 2010 20:57 WIB

Pagaralam, S Sumatra (ANTARA News) - Susno Duadji, the whistle blower on the fiscal mafia case involving rogue tax official Gayus Tambunan and several police officers on Thursday visited the South Sumatra hamlet where he lived as a child.

His return was meant to win the local people`s support for his efforts to help reveal big corruption cases, including those that had caused the country to suffer trillion-rupiah losses.

The former police`s chief detective came to Tebad Gunung hamlet, Lubuk Buntak village, Dempo Selatan sub-district, Pagaralam district, South Sumatra, where his parents` graves are also located.

Speaking to the local press here , he said he was deeply concerned about the sufferings of poor Indonesians while the government bureaucracy and law enforcement agencies were infested with corrupt officials.

"Indonesia is actually a rich country but corruption has made our people suffer a lot. The state`s money which should have been used for improving the people`s welfare is often stolen by corruptors," he said.

Duadji reiterated that his efforts to help reveal the legal mafia practices within the national police force were not meant to seek position or popularity.

Instead, he did all for the sake of a better Indonesia and the people`s welfare, he said.

"Indonesia will be a much more prosperous country if it can be freed from corruption. So much of the state`s money could then be be saved. I do believe that our people`s sufferings can be eliminated, if corruption is eradicated," he said.

The corruption cases in such sectors as taxation office and oil company, could have so far been revealed to the public, he said.

In this context, law enforcers should not only probe the corruption case involving the low level employees but also those in top positions, Susno Duadji said.

"I believe that the big corruption cases will be revealed, including those causing the country to suffer Rp70 billion, Rp100 billion or even Rp1 trillion losses," he said.

In revealing these big cases, the law enforcers need to prioritize state officials in the central government level before handling those in the regional government levels, he said.

In combating corruption, the participation of every Indonesian was needed regardless of their social and professional backgrounds, he said, adding that his return to his hometown was asking for the people`s support and visiting his parents` graves.

Susno Duadji was the whistle blower who revealed the mafia case and engineering practices within the police force in connection with Gayus Tambunan`s money laundering and corruption cases.

He had been questioned by the police investigators as a witness for the Gayus Tambunan and Arowana fish cases.

The case of rogue tax official Gayus Tambunan came under the spotlight after the police named him a suspect in connection with a suspicious Rp25 billion bank account in his name.

At least 12 middle ranking officials of the Indonesian finance ministry were allegedly involved in tax brokering cases.

In connection with Tambunan`s case, the police had arrested Haposan Hutagalung, who was Tambunan`s lawyer from June 8 to September 1, 2009, and two middle-ranking police officers.

The Gayus Tambunan fiscal mafia case had also triggered a suspension of Lampung provincial police chief Brig Gen Edmon Ilyas from his position to facilitate an investigation into his alleged involvement.

Sjahril Djohan whom Susno Duadji simply referred to as "Mr.X" when he was summoned by the House of Representatives` members recently was also detained after police investigators named him a suspect for the Arowana fish case.

President reminds regional heads of their main tasks

Antara News, Wednesday, April 28, 2010 15:45 WIB

Jakarta (ANTARA News) - President Susilo Bambang Yudhoyono has warned regional heads against immersing themselves in their own politics at the expense of their primary tasks as government officials.

In his address to open the National Development Planning Congress 2010 attended by around 2,000 people consisting of, among others, governors, district heads, mayors from all over Indonesia here on Wednesday, the President also warned them against the tendency of enriching themselves and their family members.

"All of us, including myself, should not concern ourselves about enriching ourselves and our family members," the head of state said, calling on the governors, district heads, and mayors to work hard to develop their respective areas.

The president also asked them to leave behind the habit of blaming other parties, but instead, making every effort to immediately solve every problem arising in their areas.

"Let us free ourselves from the bane of irresponsibility," the president said.

At the meeting to draw up the government`s Work Plan for 2011, the head of state reminded the governors, district heads, and mayors that the objective of national development was to improve the people`s welfare.

The congress was themed "Acceleration of Just Economic Growth Supported by Consolidation of Central-Regional Government Relations" and translated into 11 national development priorities in 2011, namely bureaucratic and administration reform, education, health, poverty eradication, food resilience, infrastructures, business and investment climate, energy, the environment, natural disasters, least developed regions, the most outer and inner islands, post-conflicts, culture, creativity and technology innovation.

The results of the earlier two working meetings led by the President and attended by governors from the country`s all provinces at Cipanas (West Java) and Tampaksiring (Bali Province), became inputs in drafting the government`s work plan 2011.

The congress is also expected to synchronize programs, main activities, venues and budgets prepared by the ministries and government institutions, which are considered urgent and need to be implemented immediately.

Presidential Instruction Signs SBY to End Nat'l Con

Kompas, Rabu, 21 April 2010 | 13:09 WIB

President Susilo Bambang Yudhoyono (RUMGAPRES/ABROR RIZKI)

TAMPAK SIRING, KOMPAS.com - President Susilo Bambang Yudhoyono is scheduled on Wednesday to close the three-day national working conference and sign a Presidential Instruction on its results. The national working conference was attended by cabinet ministers, provincial governors, DPRD (regional legislative council) chairmen, state enterprises’ chairmen, and government institutions, discussing the national economic development, pro-people’s programs, fair social development, and meeting the MDGs.

On Monday and Tuesday, the participants were divided into four working groups to discuss the four themes discussed in the working meeting. The heads of the working groups Finance Minister Sri Mulyani for economic development, National Education Minister Muhammad Nuh for pro-people programs, Social Affairs Minister Assegaf Aljufrie for fair justice development, and National Development Planning Minister Armida Alisjahbana for MDGs, briefed the press on the results of the group discussions.

Today, before conclusion, the coordinating ministers will report the results of the discussions of each working group, and the President will later give directives and guidelines and close the working meeting. The President will also inaugurate The 12th Jakarta International Handicraft Trade Fair (Inacraft) at the JCC Assembly Hall by way of teleconference.

President orders probe into court verdicts in illegal logging cases

Antara News, Saturday, April 17, 2010 02:53 WIB

Jakarta (ANTARA News) - President Susilo Bambang Yudhoyono has instructed the Anti-Mafia Task Force to investigate illegal logging court cases in which defendants only received lenient sentences or were even acquitted, a minister said.

"The President expressed concern over damage to forests," Information Minister Tifatul Sembiring said after attending a limited cabinet meeting here on Friday.

Sembiring said the President expressed his concern after he heard a report during the meeting from Forestry Minister Zulkifli Hasan that Indonesia`s primary forests had now been reduced to 24 percent from 71 percent previously.

For this reason, Sembiring said, the President ordered the Anti-Mafia Task Force which is led by Kuntoro Mangkusubroto to find out why many illegal logging defendants had only received lenient sentences.

Quoting Minister Hasan`s statement, Sembiring gave an example that of 92 illegal logging defendants, 49 were acquitted, 24 got only one-year jail term sand 19 others got penalties ranging from one to 2 years.

The information minister also said that the president and the relevant ministers would also inspect damaged forest areas. The president also called on regional government heads, namely district heads and governors to assume responsibility for the safeguarding of forests.

"(Regional governments) must be careful in issuing business licenses for forest exploitation and mining because they can worsen forest damage. A provincial-based environment master plan for big islands must be made," the president was quoted as saying.

Ministry to evaluate regional autonomy

The Jakarta Post | Wed, 02/24/2010 6:46 PM

Ten years since Indonesia created its first autonomous region, the Home Ministry has decided to evaluate the implementation of the regional autonomy law.

Home Minister Gamawan Fauzi said Wednesday the assessment aimed to analyze the performances of 205 autonomous regions and their 127 mother regions.

“We will focus on evaluating the regions’ prosperity, the quality of their administrations and public services and their competitiveness,” he said.

The project aims to produce data that would be used to map and categorize the performances of regional administrations. Gamawan said the ministry would then develop programs and strategies to improve the performance of administrations in these regions.

The assessment will also pave the way for the issuance of policies to regulate the establishment, abolishment and merging of autonomous regions, he said.

“The [Home Ministry] will also identify strategic issues in formulating several policies that will aim to improve the performances of autonomous and mother regions,” he said.

Since the deliberation of the 1999 Law on Regional Autonomy, the country has granted autonomy to 205 regions, comprising seven provinces, 164 regencies and 34 cities.

Gamawan said the number of autonomous regions had mushroomed and that the government felt it was important to slow this trend by imposing a moratorium on the establishment of new autonomous regions.

The ministry plans to make improvements to regulations covering the requirements and procedures involved in the establishment of such regions.

President, governors discuss nat'l development plans

Erwida Maulia, The Jakarta Post, Cipanas, West Java | Tue, 02/02/2010 2:52 PM

President Susilo Bambang Yudhoyono (second left) and Vice President Boediono (second right) chair a meeting of governors at the Cipanas Palace, located at the foot of Mount Gede, West Java, some 103 kilometers south of Jakarta, to discuss the medium-range development plan for 2010 to 2014 on Tuesday. Antara/ Widodo S. Jusuf

President Susilo Bambang Yudhoyono kicked off on Tuesday a two-day meeting with the Cabinet ministers and the country's 33 governors, discussing the national development plans for the next five years.

Yudhoyo said the meeting was aimed at "synchronizing" and "synergizing" development plans of the central government and the regions.

"I hope in this work meeting we can find solutions for a number of essential issues," the President said in his opening speech for the meeting, taking place from Tuesday to Wednesday at State Palace in Cipanas, West Java.

"I hope after this there will be no more blame game between the central and regional administrations, and the meeting will bring us concrete results that we would need to improve the prosperity of the people," he added.

Yudhoyono explained that participants of the meeting would be divided into six working groups, including those dealing with food and energy security, as well as infrastructure issues.

Then there are those dealing with "pro-people" programs; and with bureaucratic, law enforcement, democracy and security issues.

A single working group is focusing on spatial planning, climate change, land management, and the issues of relationship between the central and local administrations.

"What we'll be doing today is finalizing the systemic process we've started with the national gathering and then the national summit to ensure that the course of the country's developments in the next five years is on the right track," Yudhoyono said, referring to two proceeding events taking place last year.

The participants were also scheduled to hear the presentations of Vice President Boediono on the outcomes of the new government's first 100-day programs, and of National Development Planning Agency (Bappenas) head Armida Alisjahbana on the mid-term national development plans (RPJMN) for the 2010-2014 period.

"The main reason why I hope the governors can attend and take active parts in this meeting is to discuss certain issues we've been facing, to debottleneck the sources of gridlocks and problems and to formulate the rightful solutions.

"The governors and related ministers are thus expected to digging deeper into the issues in the working groups," the President said.

President to form National Economic Committee

Antara News, Friday, January 29, 2010 16:40 WIB

Jakarta (ANTARA News) - President Susilo Bambang Yudhoyono in the near future will form a National Economic Committee to help the government prepare for and address economic issues.

"In the near future, I will set up a National Economic Committee which will help the government. So We won`t be busy only when facing a crisis, but even in normal conditions we could establish partnership, and we could give appropriate responses when there are crises or problems," the President said here on Friday when opening the National Food Seminar organized by Kadin (Indonesian Chamber of Commerce and Industry) here on Friday.

The committee would be aimed at continuing the successful partnership among the government, businessmen and economists in dealing with the global financial crisis 2008-2009.

When the global financial crisis started to hit in 2008, the president set up an integrated team involving the government, businessmen, and economists to minimize the impacts of the crisis on the national economy, Yudhoyono said.

On the National Food Seminar, the head of state expressed his hope that there would be ideas to boost the country`s food sufficiency and even to produce more for exports.

"We hope that we are not only produce adequate food for Indonesia`s 230 million population, but even supply food to other countries as part of our responsibility and commitment to guarding the world`s food resilience," President Yudhoyono said.

Related Article:

President : Listen to farmers

Government revokes 706 ‘problematic’ bylaws

Erwida Maulia, The Jakarta Post, Jakarta | Wed, 01/20/2010 9:43 AM

The Home Ministry says it has revoked 706 “problematic” economic bylaws during the first 100 days of the new government, citing they breach higher regulations.

Home Minister Gamawan Fauzi said he had handed the bylaws to the Supreme Audit Agency (BPK), which is expected to reference the bylaws in its audit of regional finance reports.

“The ministry has handed over the problematic bylaws to the BPK for supervision.

“To related regional administrations, I ask that you withdraw the revoked bylaws.

“Revoking the bylaws is part of the Home Ministry’s first 100-day program,” Gamawan told tempointeraktif.com on Tuesday.

He spoke at the national working meeting of the Indonesian Regency Administrations’ Association (Apkasi) in Madiun, East Java, which was officiated by President Susilo Bambang Yudhoyono.

The ministry earlier coordinated with the BPK in dealing with more than 1,200 problematic bylaws revoked since 2002 and said they were against the regional policy’s spirit.

Director general for regional financial administration management Timbul Pudjianto was reported as saying that most revoked bylaws ruled on levies from taxes and retributions, which are imposed by regions to increase revenue.

“The revoked bylaws are almost surely related to money,” Timbul said.

In his speech Tuesday, Gamawan reminded regional administration chiefs not to set regulations that were against higher ones.

He said policies made at regional level, as with higher ones, should be aimed at improving public service, adding that many regions did not provide quality service.

Gamawan cited as an example “one-door” licensing services.

He said only 75 percent of more than 500 regencies and municipalities could provide this in Indonesia.

Apkasi chief Sujono admitted that many regional-level officials did not effectively manage regions, resulting in reliance on the central government to process business and investment licenses.

At the event, Yudhoyono told state officials at both central and local levels, to implement what he dubbed “mobile services”

“Many people don’t know how to process driving licenses, birth certificates and land certificates among others. The government, including regional administrations, must reach out,” Yudhoyono said.

He also reminded event participants that “debottlenecking” was the central government’s top priority to smoothen procedures, open businesses and invest in regions.

Editorial: Expediting budget execution

The Jakarta Post | Thu, 01/14/2010 9:20 AM | Opinion

There is indeed no longer any reason to delay the execution or disbursement of the government investment budget, as President Susilo Bambang Yudhoyono asserted early last week when presenting thousands of 2010 budget spending warrants worth Rp 1,047 trillion (US$110 billion) to ministers, heads of state institutions and provincial governors in Jakarta.

The legal and regulatory frameworks for virtually all aspects of public financial management — budget formulation and execution, public procurement of goods and services and post-audit — have all been reformed to improve the effectiveness and efficiency of public-sector spending.

The budget authorization or warrants are a breakthrough in the process of budget disbursement, especially for the investment budget, which in the past suffered the longest delays. The warrants already stipulate the project manager, treasurer and procurement officer for each investment project, thereby speeding up the bidding process.

Yet another remarkable advance was the establishment of the National Public Procurement Agency, in charge of setting nationwide standard procurement procedures, including standardized bidding documents, and the gra-dual implementation of electronic public procurement to enhance market transparency. Last week’s delivery of the budget authorization documents itself was the fastest ever made for annual state budget implementation.

The 2009 fiscal year, which ended last month, still left behind Rp 38 trillion (US$3.8 billion) or more than 20 percent of the investment budget for that year unspent due to various problems related to inadequate public budget management and institutional spending ability. But the unrealized investment budget was smaller than the previous years.

In the past, inadequate spending capacity of the line ministries and poor budget management on the part of regional administrations, which together account for around 50 percent of the national budget volume, resulted in almost 50 percent of budgeted capital expenditures being spent in the last quarter of the fiscal year. Budget spending (on investment) started slowly, then accelerating towards the end of the year, thereby causing an adverse cycle at the expense of spending quality.

But the government seems quite serious now about front-loading budget execution by early delivering of all budget authorization documents so that preparations for project implementation, including tenders, can be expedited.

Quick and efficient budget disbursement is most imperative as Indonesia urgently needs more and better spending on its basic infrastructure, such as transport and power-generation infrastructure, and public services. The 2010 budget is also conducive for infrastructure development because this fiscal year, for the first time, applied a performance-based budget system and medium-term expenditure framework to investment budget, instead of an annual cycle.

Multi-year budget appropriations for multi-year projects facilitate carry-over budget allocations, unlike the previous state budgets which were tied only to one-year budget appropriation. For example, the Rp 38 trillion carried over from the 2009 investment budget cannot automatically be disbursed this year for the projects for which the appropriations were originally intended.

Moreover, the introduction of a performance-based budget system will contribute to further integrating the planning and budgeting processes. In previous years, the decision-making processes between line ministries, the directorate generals of budget and treasury, the national planning agency and the parliament focused on input composition of the budget, rather than compliance of the spending programs with government priorities.

Govt forms technical team to evaluate regional govts` performance

Antara News, Friday, January 8, 2010 03:39 WIB

Jakarta (ANTARA News) - The government has set up a technical team and secretariat of the national team evaluating the performance of regional administrations (EPPD) as a follow up to the law on regional governments.

The technical team would assist the national team in evaluating the performance of regional governments, the implementation of regional autonomy and the formation of new autonomous regions, Head of the Information Center at the Home Affairs Ministry Saut Situmorang said on Thursday.

The national team is led by Home Affairs Minister Gamawan Fauzi with State Minister for Administrative Reforms E.E Mangindaan as a deputy chief.

Members of the national team include Finance Minister Sri Mulyani Indrawati, Law and Human Rights Minister Patrialis Akbar, Minister/State Secretary Sudi Silalahi, and Head of the National Development Planning Agency (Bappenas) Armida Alisyahbana.

Meanwhile, the technical team is led by Director General of Regional Autonomy at the Home Affairs Ministry Sodjuangon Situmorang with acting Inspector General of the Home Affairs Ministry Zaenal Arifin Pardede as a deputy chief.

Saut said the evaluation of regional governments` performance was based on Regulation of the Home Affairs Minister No. 73 of 2009 which was also a follow up to the government regulation on the EPPD.

Government Appointed 11 Partner Banks

Tempo Interactive, Tuesday, 29 December, 2009 | 15:38 WIB

TEMPO Interactive, Jakarta: Finance Department announced on Tuesday (29/12) the appointment of eight government banks that will support budget distribution in regions and three private banks to support government revenue collection for 2010 – 2012.

The eight banks consist of three national banks - Bank Mandiri, Bank Rakyat Indonesia, Bank Negara Indonesia - and five branches of the Regional Development Bank in North Sumatra, Bengkulu Province, West Kalimantan, South Sulawesi, and Maluku Province.

The three banks appointed to collect government tax and non tax revenues (except export import taxes) are CIMB Niaga, Bank Central Asia, and Citibank.

The finance department estimated around Rp210 billion in state revenue could be collected by the banks during 2010 – 2012 with potential costs of around Rp209 million.

RIEKA RAHADIANA

President asks for support to carry out mandate

Antara News, Saturday, December 12, 2009 22:21 WIB

Bogor (ANTARA News) - President Susilo Bambang Yudhoyono has asked for support of all parties to carry out his mandate as head of state and government for the next five years.

He made the request in remarks at a gathering with the Nurussalam prayer group in Ciawi, Bogor, on Saturday.

"With God`s blessings, I received the mandate to lead this country for the next five years. I hope we can work together in carrying it out and preventing activities that could hinder the mandate`s holder in performing his mission," he said.

He said the Nurussalam prayer group had stood by him during the first term of his administration and also offered criticisms when he made mistakes and supported him when he had taken right steps for the progress of the people, nation and state.

"In view of that let us unite to build this country with good morality. Let us ask our brothers to unite to develop this country, to work for the people," he said.

"Do not spread slander, lies and false rumors because the punishment will be severe for thowe who do that unless they repent," he said.

Through the forum the head of state also called on all parties to lead a life without violence.

"Even in politics noone may conduct violence, dirty tricks as they are not good politics. It is politics which is Islamic that we wish to uphold," he said.

He admitted that a lot of things were not yet good, not reflecting justice but in the past five years a lot had really been achieved.

"We have achieved a lot but shortcomings remain and must be improved," he said.

He said all parties had to contribute to the efforts to improve the situation using correct and right ways.

"Do not use ways which are not good because they will certainly create new problems while the challenges remain," he said.

Corruption, lack of transparency blocks foreign investment in RI: EU

The Jakarta Post, Jakarta | Tue, 12/08/2009 2:22 PM

The European Union (EU) has identified Indonesia's poor governance and corruption practices as part of key obstacles to expanding trade and investment between European nations and Indonesia.

That was concluded by the EU's recent study on challenges and opportunities for trade and investment in Indonesia which was presented in Tuesday by Julian Wilson, ambassador of the delegation of the European Commission to Indonesia and Brunei Darussalam.

"We have identified several key factors behind the relatively low level of EU's trades and investments towards Indonesia despite the country's growing and potential economy," Julian said.

Other key obstacles and constraints identified by the study include the lack of trade facilitation, poor customs administrations, uncertain tariff rates, import controls on some commodities, the lack of transparency in government's procurements, the lack of infrastructure, and the restrictions on foreign ownership in some sectors.

Those obstacles and constraints, Julian said, might have been the reasons why the EU traded and invested more with Indonesia's neighboring countries with smaller economies or with other emerging markets of similar size as Indonesia.

"The EU, however, still sees Indonesia's growing prospects, as long as Indonesia is willing to undertake reforms to its business and investment climate and to deepen its integration process in the areas of trade in services and investment," he explained. (bbs)

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Cartoon

Only 82 percent of education budget spent

Aditya Suharmoko, The Jakarta Post, Jakarta | Tue, 12/08/2009 4:33 PM

National Education Minister Mohammad Nuh said Tuesday his office had only spent 82.3 percent of its budget as of November, but remained optimistic it could spend a total of 95 percent by the end of the year.

"In one or two weeks, [spending] may increase to 95 percent," Nuh said on the sidelines of a seminar on governance.

"[The rate of spending] is acceptable, it’s normal ... above 90 percent is considered normal."

The National Education Ministry this year received a budget allocation of 20 percent of the total state budget, or about Rp 200 trillion (US$21 billion).

Under the Constitution, the government must allocate a fifth of its total annual budget to education. Not actual increase has been made, as most of the budget is allocated for teachers’ salaries, and not proper educational programs per se.

Kadin Asks for Wider Access to Micro Loans

Tempo Interactive, Friday, 04 December, 2009 | 15:58 WIB

TEMPO Interactive, Jakarta:The Indonesian Chamber of Commerce and Industry (Kadin) is asking for wider access to the government’s micro loan program (KUR).

According to Sandiaga S. Uno, Kadin deputy chairman on micro, small and medium enterprises and cooperatives, to widen access, the creation of additional micro financing institutions is not needed because there is concern that more socialization would be required.

“But (we could) increase (the role of) five banks outside BRI,” he said He then proposed that BRI portion should be reduced.“At the most, 70% (of the funds) should be channeled by BRI and the other 30% by five other banks,” he said.

At the moment, 97% of KUR funding is channeled by BRI.

The five other banks, Mandiri Bank, Mandiri Syariah Bank, BNI, BTN and Bukopin, channeled only 3%.

According to Sandiaga, wider access to KUR is more important than interest rate problems.He revealed that micro, small and medium enterprises did not really pay attention to 16% credit interest (per year). “Because that is much better than interest paid by market merchants, which can reach 10% per week,” he said.

Besides wider access, Kadin hope that KUR problems, like debtor information system, could be solved. “So it would not be required for micro enterprises anymore,” he said.

The government has made KUR revitalization a priority working program in 100 days. The government would channel Rp20 trillion for KUR funds in 2010.

EKA UTAMI APRILIA

Indonesia's richest double wealth in a year: Forbes

Asiaone, (AFP), Thu, Dec 03, 2009

JAKARTA - Indonesia's 40 richest people have doubled their wealth in the past year to 42 billion US dollars, mainly on the back of commodities like coal and palm oil, Forbes magazine reported Thursday.

The elite club has surpassed its previous total-wealth record, set in 2007, by two billion US dollars, despite the financial crisis which swept the world last year, the magazine said on its website.

Of the 12 main Asia-Pacific economies surveyed, Forbes said only China's wealthiest saw a better improvement, rising to a combined 106 billion US dollars from 52 billion US dollars.

India's richest were the next, with their total wealth increasing 65 percent.

"Global demand for Indonesia's natural resources fuelled the rise of many fortunes on this list," the business magazine said.

"More than one-third of the top 40 make the bulk of their money in coal, palm oil or oil and gas, including four of the five newcomers."

Nine Indonesian tycoons at least tripled their wealth since last year, it said, and the Southeast Asian powerhouse now has 12 billionaires with a combined wealth of 28 billion US dollars, from seven last year.

The brothers R. Budi and Michael Hartono, whose interests include clove cigarettes, banking and the upmarket Grand Indonesia shopping mall, claimed the top spot with a pooled wealth of seven billion US dollars.

"We combined their fortunes this year to reflect the fact that this ranking, unlike Forbes' Billionaires list, includes a number of family fortunes," the magazine said.

"Still, had they not been combined, their individual net worths of 3.5 billion US dollars apiece would have earned them the top two slots."

Second was palm oil tycoon Martua Sitorus with three billion US dollars, while Susilo Wonowidjojo came third, earning 2.6 billion US dollars from tobacco.

One of the new billionaires was coal magnate Low Tuck Kwong, whose Bayan Resources soared 474 percent this year, while the country's main stock index has climbed more than 80 percent.

Former welfare minister and new leader of the Golkar party, Aburizal Bakrie, regained his billionaire status thanks to the dramatic rise from share market oblivion earlier this year of his heavyweight coal unit Bumi Resources.

Palm oil firm First Resources chief executive Ciliandra Fangiono, 33, was the richest newcomer to the list with an estimated 710 million US dollars in the bank.

Related Article:

Forbes Publishes List of Indonesia's Top 40 Richest People

Indonesia optimistic its economy will grow 4.5 percent

Jakarta (ANTARA News) - Indonesia is optimistic its economy will grow 4.5 percent in 2009 in spite of the impact of the global financial crisis on several of its economic sectors.

Its finance minister Sri Mulyani Indrawati said after a limited cabinet meeting on economy on Monday "our projection remains between 4.0 and 4.5 percent until the end of this year. Indeed international institutes are projecting the country`s economy will only grow 3.0 to 3.4 percent."

She said the country`s economic growth in the first quarter could still reach above 4.0 percent and this was a good beginning to show that the country`s economy remained quite resilient against the negative impact of the global economic crisis.

She said she predicted the country`s economy grew between 4.3 and 4.8 percent in the first quarter on consumption that grew 5.5 percent.

She said household economic growth in the period was predicted to be between 4.3 and 5.0 percent or down from 6.4 percent in the fourth quarter of 2008.

"The consumption growth of between 4.3 and 5.0 percent is still quite high as several parties are predicting that the country`s economy will grow lower than expectations," she said.

The growth of government consumption in the first quarter this year is predicted at between 8.0 and 13.1 percent or higher than that of the same period last year.

The minister said the global financial crisis had affected investment as well as export and import performance as shown by first quarter figures.

Investment is predicted to grow 5.0 to 6.5 percent in the first quarter or lower than the average growth in 2008 that reached double-digit between 10 and 13 percent. "So there has been a correction of more than 50 percent," she said.

Exports in the period contracted between minus 6.0 and minus 9.0 percent or dropped sharply from 13.6 percent in the same period last year.

"In the fourth quarter of 2008 our exports grew almost 1.8 percent so contraction in the first period of 2009 is a declining trend resulting from global economic downturn," she said.

Imports also contracted in the first quarter of 2009 between minus 8.0 percent and minus 12 percent and because the drop was deeper than that of exports the country`s trade balance remained positive at US$607 million until the end of March.

Exports in the first quarter reached US$22.55 billion while imports US$18.578 billion, leaving a surplus of US$3.974 billion.