Jokowi Returns to Jakarta After S. Korea, Russia Trip

Jakarta Globe, Eko Prasetyo, May 21, 2016

President Joko Widodo welcomed by Vice President Jusuf Kalla at Halim
Perdanakusuma Airport, East Jakarta, Saturday (21/05). After an official visit
to South Korea and Russia, Jokowi has secured partnership agreements
and investment commitments to Indonesia. (State Palace Press Photo/Laily) 

Jakarta. After a week of meetings in South Korea and Russia, President Joko Widodo returned to Jakarta on Saturday (21/05) boasting commitments to bilateral and regional partnerships.

The five day trip resulted in a variety of agreements with South Korean and Russian private business, as well as among Asean.

"In the visit to Korea, there was high enthusiasm from South Korean businessmen. The resulting deals have reached around $18 billion," Foreign Minster Retno Marsudi said in a statement at Halim Perdanakusuma Airport, East Jakarta.

At least seven agreements were signed in South Korea, including in the maritime, creative industry, sports, special economic regions and corruption eradication sectors.

In Russia, Joko met with President Vladimir Putin to enhance partnerships in palm exports, fisheries and investment diversification.

"All the potential will be followed up," Retno said, adding that Russia has also committed to constructing a $13 billion oil refinery. “Also, there were five agreements on defense, fishing, culture, national archive and foreign ministry archives.”

During the Asean-Russia Summit, Joko said partnerships should be focused on energy, small-medium enterprises and connectivity, while maintaining peace and security in the region.

Joko met with the Vietnamese and Singaporean Prime Ministers to discuss the realization of the 2018 $10 billion trade target and continuing maritime delimitations.

President Joko Widodo inaugurated as Seoul's honorary citizen, during his state
visit to the South Korean capital on Tuesday (17/05). (State Palace Press Photo/Intan)

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Why didn't Indonesia's Jokowi stop the execution of drug traffickers?

Indonesia has ignored last-minute appeals by foreign leaders and executed six people convicted of drug trafficking. Analyst Yohanes Sulaiman tells DW President Jokowi is trying to convey the image of a "decisive leader."

Deutsche Welle, 20 Jan 2015

Brazil and the Netherlands recalled their ambassadors from Indonesia on January 18 after Jakarta ignored their pleas and executed two of their citizens by firing squad along with four other drug offenders from Vietnam, Malawi, Nigeria and Indonesia. The six were the first people executed under new Indonesian President Joko "Jokowi" Widodo, who has disappointed rights activists by voicing support for capital punishment.

President Jokowi defended the executions, saying those convicted of drug trafficking will not receive a presidential pardon since Indonesia is facing an "emergency" over drug use. Jakarta had an unofficial four-year moratorium on executions until 2013, when five people were put before the firing squad. There were no executions last year.

In a DW interview, Indonesia analyst Yohanes Sulaiman says President Jokowi appears to have been under no apparent pressure to restart executions and that he is simply trying to convey the image of being a decisive leader in a country where there seems to be public support for the death penalty.

DW: Why does Indonesia have such a strong policy against drug traffickers?

'Overt international pressure to stop the 

executions will backfire spectacularly,' 

says Sulaiman

Yohannes Sulaiman: Drug abuse is a big problem in Indonesia. Each year the number of addicts is increasing. Since it is believed that the majority of drugs in Indonesia are imported, the government believes that by imposing harsh punishment on traffickers, they could reduce or halt the importation of drugs.

Why has President Joko Widodo decided to stick to the country's policy of executing drug offenders?

There is actually no overt pressure from either the party, the media, or the public. However, while there are a lot of discussions on death penalty, generally the public and media in Indonesia are clamoring for the death penalty to be expanded to people engaged in corruption.

A quick glimpse of the media in the past couple of years reveals that there have been few discussions on the death penalty being imposed on drug traffickers - except during a couple of occasions when there were new developments such as the release of Schapelle Corby, an Australian who was convicted and imprisoned for drug smuggling. So the sudden restart of executions comes out of the blue.

My guess is that President Jokowi wants to show "results" and his "decisiveness" especially in the first 100 days of his administration. Keep in mind that the issue of "being decisive" has hobbled Jokowi since the election campaigning, where the opposition kept claiming that he was and would be a very weak leader.

It seems to me that burning ships engaged in illegal fishing and re-imposing the death penalty are things that he could do to stress and buttress the idea that he is a strong, decisive leader, while giving him a huge boost in popularity. In fact, if he stops executions now, he could actually lose a huge amount of prestige and popularity. The death penalty genie is already out of the bottle.

How do you think the latest executions will affect Indonesia's relations with nations such as Brazil or the Netherlands?

I don't see any long-term damage in ties between Indonesia and the Netherlands. Indonesia is one of the most important countries in Southeast Asia and, one could argue, even in the world, thanks to its demographic and geostrategic position. The Dutch have a strong economic relationship with Indonesia - the Netherlands is one of the five main investors in Indonesia. The situation is similar with Brazil, with bilateral trade booming.

Sulaiman: 'The death penalty is
 popular in Indonesia'

Furthermore, both Netherlands and Brazil have close political ties with the country. It is therefore very doubtful that both countries would risk this strong relationship. So while there will be a short-term dip in relations, I don't think this will have a strong impact in the long run.

What about the reactions from human rights groups?

The human rights groups are obviously disappointed, considering many believed that Jokowi would have much better track record in terms of human rights than his electoral rival Prabowo Subianto, who was suspected of being involved in human rights abuses back during the era of Indonesian strongman Suharto.

However, the main question is: Who voted for Jokowi? As already mentioned, the death penalty is popular in Indonesia even though you can argue that its effectiveness is overrated and it is not applied fairly.

What's important is to convey the image that you have a decisive president willing to impose the death penalty on those who are bent on poisoning the minds of the youths with drugs. That could be the image that wins the next election - or shows at least that the president is doing something in the first 100 days of his administration.

Will diplomatic appeals help prevent other executions?

It is a difficult question to answer because there are plenty of factors that might influence this. Obviously, overt international pressure, I think, will backfire spectacularly. The last thing Jokowi wants to have is the image of him kowtowing to foreign governments and pardoning drug smugglers on the death row.

Sulaiman: 'The government believes it
could halt the importation of drugs by
imposing harsh punishment on traffickers'

The opposition and the media would have a field day condemning the government and that also runs counter to the image that Jokowi wants to cultivate, which is the image of him as a "decisive leader" who wants Indonesia to be respected abroad.

I think diplomatic appeals, done quietly and with some incentives behind it, could prevent the executions. The death penalty genie is already out of the bottle, so there's no way that Jokowi could declare that he would stop the executions.

But, he could use the oldest trick in the book: just do nothing and people will forget about it. In order to do that, though, the Australians should put something on the table in exchange for another moratorium on the death penalty. That might work, but it has to be done very quietly.

Yohanes Sulaiman is Lecturer in International Relations and Political Science at the Indonesian Defense University.

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Indonesia executes six drug convicts, five of them foreigners

Indonesia has executed six people convicted on drug charges, despite international pleas for them to be spared. They are the first executions to take place under new President Joko Widodo.

  

Deutsche Welle, 17 Jan 2015

Five foreigners and an Indonesian woman sentenced to death on drug charges will
 be executed by firing squad despite international pleas, Indonesian officials
said Saturday. (AP Photo/Wagino)

Indonesia on Sunday put to death five foreigners and an Indonesian woman who had all been sentenced to death on drug charges, despite calls for a stay of execution from around the world.

The foreigners came from Brazil, the Netherlands, Vietnam, Malawi and Nigeria. The executions were carried out by firing squad.

Indonesian authorities refused to heed all international requests for clemency. These included a last-minute appeal to President Joko Widodo by Brazilian President Dilma Rousseff to spare the life of her compatriot Marco Archer Cardoso Moreira.

"The enforcement of the death penalty, which is increasingly rejected by the international community, has grave consequences for the relations between our two countries," Rousseff said on Saturday local time after Moreira, 53, was executed despite her plea.

Ex-pilot Moreira was among those
executed

The Dutch government also made a last-minute plea for the life of its citizen, Ang Kiem Soei, 62, that was disregarded as well.

The others who died were Indonesian woman Rani Andriani, Nigerian Daniel Enemuo, Namaona Denis from Malawi, and a woman from Vietnam, Tran Thi Bich Hanh.

'Cruel and inhumane'

The European Union had earlier also urged Indonesia to halt the executions. Foreign policy chief Federica Mogerini called the plan "deeply regrettable," and described the death penalty as "a cruel and inhumane punishment that fails to act as a deterrent and represents an unacceptable denial of human dignity and integrity."

Amnesty International's research director for Southeast Asia and the Pacific, Rupert Abbott, said the executions were "a seriously regressive move," and called on Jakarta to halt plans for future ones. Indonesian authorities say 20 are planned for this year.

Indonesia, which has strict drug laws, ceased executing people in 2008, but began again in 2013, though 2014 saw no one put to death.

Widodo has pledged to bring
reform to Indonesia

Widodo, who took office in October, has disappointed activists by his strong support for capital punishment despite promises to improve the human rights situation in his country. Last month, he rejected appeals for clemency from all those executed on Sunday.

His tough stance has raised concern about other foreigners facing a death sentence, including two Australians who were part of a group, dubbed the "Bali Nine," that tried to smuggle heroin out of Indonesia in 2005.

One of them, Myuran Sukumaran, also had his clemency appeal rejected last month, but his accomplice Andrew Chan is still waiting for the outcome of his.

tj/bw AFP, AP, dpa)

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Widodo has pledged to bring reform to Indonesia

Jokowi Signals Break With ‘Thousand Friends’ Foreign Policy

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Jakarta Archbishop Criticizes Indonesia’s Use of Death Penalty
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Mounting labor costs forces Nike to relocate in China

Want China Times, Staff Reporter 2013-02-27

A worker in a shoe factory in Hangzhou. (Photo/Xinhua)

A Guangdong shoe manufacturer for the leading US brand Nike has cut its work force to 4,000 from 13,000 since the global financial crisis five years ago, China Business News reported on Feb. 26.

The factory has no recruitment plans even in the current hiring season after the Chinese New Year holiday, said the factory manager, surnamed Wu.

Nike paid its workers US$200 a month in the 1990s, when plants came to China from Taiwan, Wu said. Labor costs have rocketed after the financial crisis, now over US$500 a month. The pay well exceeds Indonesian salaries at US$300 and Vietnam's US$250 a month, Wu added.

"We have lost part of our orders as Nike would not pay a cent more if it could strike a deal without that cent," Wu said. "If I felt like taking a risk, I could have kept about 10,000 employees. But this means we would have to pay an extra US$2 million each month to prevent orders from going to Indonesian competitors."

Rising labor costs and intense competition have put sportswear giants, such as Nike and Adidas, in a dilemma about slashing profits or making fewer products.

Another Guangdong manufacturer who has contracts with Nike told China Business News that it plans to raise quotes because minimum wages in China have skyrocketed over recent years. The manufacturer also admitted that it was very likely to receive fewer orders.

A pair of sports shoes manufactured in Guangdong costs US$1 to US$2 more than those made in Indonesia or Vietnam. Nike still leaves a reasonable amount of orders to Guangdong shoemakers because of quality standards, and the domestic market is still promising despite a 6% decrease in orders from China for five months through April 2013, a Nike contract manufacturer said.

Statistics compiled by China Business News showed that in 2001, China made 40% of Nike's sneakers and Vietnam 13%. In 2005, China's contribution declined to 36% while Vietnam's climbed to 26%. In 2009, Vietnam caught up with China, both individually making 36% of all Nike sneakers. In 2010, Vietnam overtook China, making 37% of Nike's sneakers versus 34% by China.

Sourcing raw materials for sneakers and sportswear and their assembly lines are easier to standardize, giving Nike leverage to move its production base to China's hinterland and Southeast Asian countries, said Li Peng, Asia Footwear Association secretary general.

Nike has established five production sites in Jiangxi province, employing tens of thousands of workers.

WB clamps down on Vietnamese, Indonesian firms

The Jakarta Post, Viet Nam News, The Asia News Network, Thu, 12/15/2011

The World Bank announced on Tuesday its debarment of three companies and one individual for punishable practices under WB-financed water supply projects in Vietnam and Indonesia.

The companies include Vietnamese Social and Environmental Development JSC (SECO), Australian Kellogg Brown&Root Pty Ltd (KBR Pty) and Indonesian PT Amythas Experts and Associates. The World Bank also debarred Nguyen Xuan Doan, Managing Director of SECO, who was found to be involved in the same sector in Vietnam.

"This settlement shows the Bank’s work on integrity is resilient while we support companies to clean up their operations and therefore enforcing international compliance standards," said Leonard McCarthy, integrity vice president at the World Bank.

According to allegations, SECO engaged in a scheme to defraud World Bank clients and has been declared ineligible to participate in Bank Group-financed projects for the next five years.

KBR Pty, an Australian subsidiary of KBR Inc, was debarred for a period of two years with conditional release following an investigation by the Bank’s Integrity Vice Presidency (INT) into violations of the Consultant’s Guidelines under a local Bank-financed water supply project. KBR Pty misrepresented the availability of key consultants during contract negotiation and execution, which resulted in the company being awarded the contract and delays in execution.

Following the terms of the agreement KBR Inc will also implement remedial measures to its corporate compliance program to comply with the World Bank Compliance standards.

The World Bank also debarred Indonesian PT Amythas Experts and Associates for a period of three years for fraudulent practices in relation to a World Bank-financed community development and poverty alleviation project.

"We have to act with ever more vigilance when it comes to rooting out fraud and corruption," said McCarthy.

Amythas Experts will be required to implement a corporate compliance program in line with World Bank standards and meet other conditions as part of the settlement under the debarment that became effective on December 7. The period of debarment could be shortened if the company meets additional conditions of restitution and disclosure.

The three companies cannot be awarded a contract, or otherwise participate in new activities under World Bank Group-financed or executed projects during the debarment period.

They are eligible for cross debarment under the April 2010 Agreement for Mutual Enforcement of Debarment Decisions entered into by the African Development Bank Group, the Asian Development Bank, the European Bank for Reconstruction and Development, the World Bank Group and the Inter-American Development Bank Group.

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Get together

The Jakarta Post, The Associated Press, Fri, 04/09/2010 1:31 PM

Malaysian Prime Minister Najib Razak (left) and Indonesian President Susilo Bambang Yudhoyono attend the 16th Association of Southeast Asian Nations (ASEAN) Summit Retreat Session in Hanoi, Vietnam Friday. Indonesia will take over chairing ASEAN from Brunei and will host the group’s summit next year after Brunei agreed to hand over chairmanship to Jakarta during a meeting in Hanoi on Wednesday. AP/Julian Abram Wainwright

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Vietnam, RI competing to attract foreign investment

Lilian Budianto, The Jakarta Post, Jakarta | Fri, 02/12/2010 10:40 AM

Political stability and cheap labor have contributed to a healthy economy in Vietnam, rivaling Indonesia’s economic growth within the Southeast Asian region, says a senior Indonesian diplomat.

Indonesian Ambassador to Vietnam Pitono Purnomo said Hanoi grew by more than 6 percent last year, surpassing Indonesia, the largest economy in Southeast Asia, because the one-party state provided better security and offered cheaper labor.

Indonesia’s economic growth stood at 4.5 percent in 2009.

“Demonstrations are rare in Vietnam as the government imposes strict security rules. From an economic perspective, this is an advantage when it comes to attracting foreign investment,” he said.

The ambassador said Indonesia had better wage standards and working conditions compared to Vietnam, but this had also discouraged foreign investment.

“Living standards are lower in Vietnam and that’s why they can suppress wages,” he said.

Indonesia’s foreign investment stood at US$10.82 billion in 2009 with Singapore as the biggest investor, followed by the Netherlands and Japan.

Vietnam’s foreign investment reached $9.8 billion in 2009. The United States made up the bulk of the investment, followed by the Cayman Islands.

Indonesia, with its fledgling democracy, has seen many street protests, including labor strikes, that observers say often interrupt productivity. Businesspeople have also recently protested over the ASEAN-China Free Trade Agreement, saying that flows of Chinese products will harm local businesses.

Pitono said that he had not heard of similar concerns in Vietnam.

“They have not complained because they have long established trade relations. China is Vietnam’s main trading partner and China has invested a lot in Vietnam,” he said.

“Chinese products have long existed in Vietnam and vice versa. Vietnamese products, especially in agriculture and mining, also dominate China as both are close neighbors. Vietnam has seen China’s large population of 1.3 billion as an opportunity, not a threat.”

Pitono, however, said that Indonesia could compete as Indonesia had better skilled workers than Vietnam.

“We are also looking into the possibility of a working agreement because we produce similar products.

We can complement each other, for example, if Vietnam imports some materials from Indonesia to be made in Vietnam,” he said.

Pitono said bilateral relations between Indonesia and Vietnam were “healthy and robust”, with two-way trade totaling $2.1 billion in 2009 in favor of Indonesia.

Indonesia exports chemical products, spare parts and steel to Vietnam, while Indonesia imports rubber and agricultural products from Vietnam.

Indonesia, Philippines Plan January Global Debt Sales

Businessweek

By Shelley Smith, January 04, 2010, 08:38 AM EST

Jan. 4 (Bloomberg) -- Indonesia, the Philippines and Vietnam are competing to be among the first Asian governments to sell foreign-currency bonds in 2010, as a global economic recovery supports investor appetite for emerging-market debt.

Indonesia plans to sell as much as $4 billion of U.S. dollar bonds with 10- and 30-year maturities, a person familiar with the matter said today. The Philippines is preparing to sell as much as $1.5 billion of debt denominated in dollars or euros, while Vietnam plans to raise as much as $1 billion in dollar bonds this month, according to people aware of the plans.

“There’s appetite for high-yielders,” said Michael Pisler, an emerging-market debt trader at SJS Markets Ltd. in Hong Kong. “The biggest determining factor will be fund inflows into the region as the economies improve.”

The difference in yield to own bonds in developing countries instead of Treasuries dropped 4.16 percentage points last year to 2.74 percentage points, according to an index compiled by JPMorgan Chase & Co. Global funds bought more than $8 billion of emerging-market debt in 2009, after pulling out $18 billion in 2008, according to data published by EPFR Global.

The government may sell global bonds through a placement “when the time is right,” Finance Minister Sri Mulyani Indrawati said in Jakarta today, without giving details. Indonesia hired Barclays Capital Plc, Citigroup Inc. and Credit Suisse Group AG for a sale, a ministry official said last month.

Time is Right

Indonesia, Southeast Asia’s biggest economy, last sold $3 billion of bonds in overseas markets in February, and raised $650 million from the sale of Islamic dollar bonds in April. The government plans to raise $11 billion from local and overseas bond sales in 2010 to finance a budget deficit forecast at 98 trillion rupiah ($10.4 billion), or 1.6 percent of gross domestic product

Indonesia’s budget deficit totaled 87.2 trillion rupiah last year, less than a forecast 129.8 trillion rupiah, the Finance Ministry said on Jan. 1. The economy probably grew 4.3 percent to 4.4 percent last year, the ministry said.

Moody’s Investors Service lifted Indonesia’s foreign- currency debt ratings one level to Ba2 on Sept. 16, citing the economy’s resilience. The Moody’s rating is two levels below investment grade.

Investors demand a 2.08 percentage points yield premium over U.S. Treasuries to buy Indonesian debt, according to the JPMorgan EMBI+ spread. The gap narrowed 70 basis points in 2009, compared with a 167 basis points widening in 2008. The cost to protect the bonds against default also fell in 2009, according to credit-default swap prices compiled by CMA DataVision.

Philippines, Vietnam

Yields on Indonesian 30-year debt and Philippine 25-year dollar debt rose today, ING Groep prices showed.

The Philippines has sold dollar-denominated bonds every January since 2005, according to data compiled by Bloomberg. It plans to raise $2 billion from the sale of overseas debt in 2010 to fund a budget deficit that Finance Secretary Gary Teves said may climb to a record 293 billion pesos ($6.4 billion) this year.

The Philippines is “opportunistic” in its borrowing and will sell overseas bonds when it’s the “right time,” central bank Governor Amando Tetangco told reporters today in Manila.

The central bank allowed the government “in principle” to sell up to $1.5 billion of global bonds, a person familiar said on Dec. 29. Separate approval was given to a plan to sell about $500 million in yen-denominated bonds, the person said.

“The government would want to put its finances in a solid footing by borrowing abroad early and at good levels,” said Roland Avante, treasurer at Manila-based Sterling Bank of Asia. “That, and the huge liquidity in the local market, would help ease pressure on domestic debt.”

Vietnam may sell notes with 10-year maturities, according to a person who declined to be identified before a public announcement. Vietnam hired Barclays Capital, Citigroup Inc. and Deutsche Bank AG to manage the sale, the person said.

--With assistance from David Yong in Singapore and Clarissa Batino in Manila. Editors: Sandy Hendry, Tom Kohn

To contact the reporter on this story: Shelley Smith in Hong Kong at +852-2977-6623 or ssmith118@bloomberg.net

To contact the editor responsible for this story: Tom Kohn at +852-2977-6610 or tkohn@bloomberg.net; Sandy Hendry at +852-2977-6608 or shendry@bloomberg.net.