Reading the regional election results | Go-Jek goes abroad with new brands | Indonesia Intelligencer (June 23-29)
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Business
Trying to stop the rupiah’s drop
The rupiah dropped to a new low of IDR14,398 against the US dollar on Thursday — its worst rate since October 2015 — which economists say was caused by a global emerging market sell-off triggered by higher US interest rates.
Bank Indonesia, which has already introduced rate hikes to stem a currency rout under new Governor Perry Warjiyo, is expected to raise rates again on Friday. It would be the third interest rate hike by the central bank in a month.
Wilmar’s shell game: Greenpeace accused Wilmar International — the world’s largest palm oil trader — of destroying an enormous area of rainforest, twice the size of Paris, in Papua through their purchasing of palm oil through an alleged shell company. The environmental NGO says this goes against an anti-deforestation pledge the company made five years ago, and urged companies who trade with Wilmar to demand clean palm oil.
Go-Viet and GET: Following weeks of speculation, Indonesian “unicorn” Go-Jek has finally given concrete details about its Southeast Asia expansion with the announcement of imminent launches in both Vietnam and Thailand. Go-Jek chose not to use its Indonesian branding abroad, opting to create new localized names and looks. In Vietnam, its service will go by Go-Viet, while in Thailand, it will operate under the moniker GET.
France and Germany, meet Lion Air: Indonesian low-cost carrier Lion Air is studying the possibility of launching routes to France and Germany after the EU lifted its ban on Indonesian airlines. The EU previously enacted the ban over the Indonesian aviation industry’s failure to meet international safety standards. The ban’s removal means travelers from Europe and Indonesia may soon have cheaper flight options available, albeit from an infamously tardy airline.
ExxonMobil acquires Federal Oil: US oil and gas company ExxonMobil has completed its acquisition of PT Mitra Pinasthika Mustika Tbk., the company behind Federal Oil, one of the most popular motorcycle lubricant brands in Indonesia. As part of the deal, ExxonMobil also acquired a 700,000 barrel-per-year blending plant in Cilegon, Banten.
Lippo invests in Tencent: Indonesian conglomerate Lippo Group is strengthening its “digital muscle” with a US$43.9 million investment in Chinese internet group Tencent Holdings, best known for its messaging app WeChat. The move continues Lippo’s foray into digital business, particularly with its aggressive focus on its e-commerce service mataharimall.com in recent years.
OYO’s coming, yo: Indian budget hotel network OYO Hotels is planning to launch operations in Indonesia, as well as in the UK, within 12-18 months. The move comes as part of its global expansion, after having recently launched in China.
LINE dedicates new news app to Indonesia: Indonesians are among the biggest users of Japanese messaging app LINE, and, by extension, its news aggregation service LINE Today. On Wednesday, the company launched a dedicated LINE Today app for its Indonesia market, which won’t require users to have a LINE account to access content.
BI pulling old banknotes: Unless you want to keep them as valuable rare collector’s items for the future, Indonesian citizens are urged to exchange old banknotes for new ones to Bank Indonesia by December 30, 2018. The specific bills are IDR10K and IDR20K issued in 1998, and IDR50K and IDR100K issued in 1999.
Recommended reads
Can Indonesia balance globalisation with economic populism? (The Edge Markets): Globalization or economic protectionism — where exactly does Indonesia stand? This article explores evidence for both under President Joko Widodo’s government, suggesting that the country is at a crossroads in which its next steps are especially important in determining future economic and social inclusion.
2018 Asian Games: Time for Indonesia to shine (The Jakarta Post): The upcoming Asian Games in August doesn’t just represent the chance for sporting glory for Indonesia, it also represents a key opportunity to boost the country’s tourism.
Politics
Reading the regional election results: On Wednesday, Indonesians voted in regional elections for candidates in 171 contests across the country. Among the key takeaways:
Most analysts think President Joko Widodo should be worried, as the overall result point to a strengthening of opposition support in key regions throughout the country, suggesting he will have a tougher time in next year’s election than previously thought. Candidates backed by the ruling coalition did win in populous regions like West Java and Central Java, but opposition candidates in those areas performed far better than expected.
Jokowi’s PDI-P party did not fare well at the polls, with their candidates losing in 11 of the 15 governor’s races they were competing in.
The National Mandate Party (PAN) was the biggest victor of the day, with its candidates winning in 10 governor races. Their increased political strength will make it much more likely that Gerindra Chairman Prabowo Subianto will pick PAN chairman Zulkifli Hasan as his running mate in order to cement the coalition needed to make Prabowo’s presidential candidacy official by fulfilling the mandated political support threshold.
For a different take on how this week’s results may affect the 2019 race, read: Indonesia’s Provincial Elections Point to Second Term for Jokowi (Bloomberg)
Controversial MD3 Law gets declawed by court: The Constitutional Court struck down several of the most controversial articles from the 2018 Legislative Institutions (MD3) Law, including articles perceived as shielding legislators from criminal investigations as well as those giving them the ability to legally punish their critics.
Rumors of Indonesian-language requirement for foreign workers denied: A report from the New York Times, Indonesia’s Order to Foreign Workers: Learn the Language, detailing an Indonesian language learning requirement for foreign workers mandated by a new Presidential Decree (Perpres), set to go into effect today, has been much discussed this week. Government officials denied the rumors that the Perpres requires foreign workers to be proficient in Bahasa Indonesia to be able to work in the country, explaining that it only requires them to formally learn the language in some capacity — details of which have not yet even been ironed out.
Mahathir meets Jokowi: Newly-elected Malaysian Prime Minister Mahathir Mohamad arrived in Indonesia yesterday for his first state visit to the country since being sworn in last month. His two-day visit will include meetings with the Malaysian community in Indonesia, key Indonesian business figures and, of course, bilateral discussions with President Joko Widodo regarding relations between the neighboring nations.
Recommended reads
An interview with Ridwan Kamil (New Mandala): In this wide-ranging interview conducted the day after the Bandung mayor emerged victorious in the West Java Governor’s race, Ridwan discusses issues including the role of Islam in modern Indonesian politics, the controversy over his claimed support of the LGBT community and countering so-called black campaigns.
How do you reconcile being a pluralist candidate but not standing up for LGBT when the time came in this campaign?
The LGBT is a controversial thing, not in your context but in my context. I lived in America, where it was no issue. I lived in Hong Kong, where it is no issue. But I live in Indonesia, where there is an issue. By the opponent claiming I’m a supporter of that issue, it really created a massive problem to my electorate. My personal view is always the same: I’m a Muslim, so anything said by the Koran I will follow. But as I said, I cannot do more without the formal law.
Corruption and the high cost of politics in Indonesia (La Croix)
Indonesia Corruption Watch recorded more than 200 cases between 2010-2017 in which regional leaders were suspected of various forms of graft, ranging from bribery and budget manipulation, to corruption related to the procurement of goods and services. This shows that local politicians are highly vulnerable to corruption and it is highly likely some of those elected in this year’s local election — 17 governors, 39 mayors and 115 district heads — will not go untainted during their terms.
Other News and Notable Features
Agung erupts again, shutting Bali airport: Bali’s Ngurah Rai International Airport will be shut down until at least 7pm today (June 29) following an eruption of volcanic ash from the island’s Mount Agung, stranding thousands of tourists.
Counter-terrorism crackdown continues: Indonesia's elite counter-terrorism police squad, Densus 88, said it was planning to arrest more than 100 suspected militants in order to prevent revenge attacks following the death sentence placed on radical cleric Aman Abdurrahman for his role in masterminding four deadly terrorists attacks.
Captain of doomed ferry named suspect
Indonesian police have named four people as suspects in their criminal investigating into the sinking of an overloaded ferry on Lake Toba last week in which some 200 people are believed to have died. Among the suspects is the ferry’s captain, who was among the few survivors.
The National Search and Rescue Agency (Basarnas) announced today that they believe they have located the wreckage of the ship and will begin recovery procedures for the bodies of the victims immediately.
Recommended reads
Islamist militant prisoners freed in Indonesia turn a new leaf via schemes to change their radical beliefs and return them to society (SCMP): Non-profit and state groups work to deradicalise jailed Islamist militants and empower them to make an honest living, but critics say such schemes fail to reach hardliners and many who take part had already abandoned radicalism
'I've been sick in the chest': Tobacco fields take toll on Indonesian children (The Guardian)
While Indonesian labor laws prohibit anyone under the age of 18 from performing hazardous work, in practice, especially in small-scale farming in Indonesia’s under-developed eastern regions, the laws are often poorly enforced and understood.
Indonesia’s “Small Fry” Drug Dealers (New Naratif): For those in Indonesia with few employment options and limited capital, selling drugs can be a lucrative and easy way to earn extra money—thanks to surprising support from the local community.
There’s now proof that Soeharto orchestrated the 1965 killings (Indonesia at Melbourne)
It is now possible to explain how Soeharto used existing chains of command to bring the military to power. My book, The Army and the Indonesian Genocide: Mechanics of Mass Murder, (link is external) shows how the military initiated and implemented the 1965-66 mass killings. This article focuses on the mechanics of the military’s coup.
The life of an Iranian refugee in Jakarta: 'Of course I feel less than a human being' (ABC)
Meeting malnourished babies, adults living with chronic pain, disabled children stuck in bed forever — who all desperately need help — makes Mozhgan feel overwhelmed by the sense of hopelessness.
While she does what she can to support them, she also struggles with personal challenges. She wonders how long her fiancé will stay with her when she can't marry legally or have children; can't travel with him, can't work, and can't think about the future.
She is no stranger to suicidal thoughts.
"In our country, we might have got arrested, gone to jail, been tortured, or died. It would last a very short time, but here we are dying gradually," she says.
Top Coconuts Jakarta Stories
Quick count shows mayoral candidate running unopposed in Makassar lost to blank box
Nutty Justice: Thief in Indonesia allegedly kicks cop in the crotch, gets shot in the leg
Only 24% of Australians agree that Indonesia is a democracy: poll
Making good on PM Modi’s promise, India now offers free e-Visa for Indonesians
At least 8 dead due to bootleg alcohol in W. Jakarta, suspected seller to be charged with murder
Indonesians feel they are safer from crime than citizens of most other countries: Gallup poll
Anti-corruption commission’s advice to voters: Don’t vote for corruption suspects (there are 9)
Israel’s foreign ministry confirms mutual lifting of travel ban with Indonesia
Authorities on the hunt for 3 crocodiles spotted swimming in Jakarta’s Grogol river