Ministers' Blunders May Erode Public Trust in Jokowi Minister Suspected Of

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th Monday , March 9 , 2020

GENERAL NEWS AND HEADLINES

Ministers’ blunders may erode public trust in Jokowi The Jakarta Post, p.2

As President Joko “Jokowi” Widodo’s administration handles crisis after crisis in the first five months of his second term in office, some of his aides have been criticized for public statements that have caused anxiety and distrust in the government.

Health Minister Terawan Agus Putranto has been criticized for his lack of transparency and sluggish efforts to test for and trace the COVID-19 coronavirus.

The public health crisis was not the only case in which Cabinet members showed a lack of transparency. In January, Law and Human Rights Minister Yasonna Laoly came under fire for announcing the wrong information on the whereabouts of Indonesian Democratic Party of Struggle (PDI-P) politician Harun Masiku, who had been named a suspect in a graft case.

Firman Noor, head of the Indonesian Institute of Sciences' Political Research Center, warned that the ministers' poor communication could have a major impact on public trust in Jokowi's administration.

Public trust in Jokowi is still very high. A recent survey by Indo Barometer found that 70.1 percent of respondents were satisfied with Jokowi’s performance. However, with continuously poor performance by his ministers, Jokowi might soon be in trouble.

Firman said the government did not appear to have a strategy to prevent ministerial blunders and Jokowi seemed to still be observing his new ministers.

Minister suspected of suppressing information about coronavirus Koran Tempo, Headline

Health Minister Terawan Agus Putranto is suspected of suppressing information about the spread of the COVID-19 coronavirus in the country. Terawan is believed to have

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withheld information about the spread of the virus prior to President Joko “Jokowi” Widodo’s announcement last week on Indonesia’s first two confirmed COVID-19 cases.

A source told Tempo that since the disease’s first outbreak in China, the health minister had apparently underestimated the health risks posed by the disease. The source added that Terawan had ignored advice given by two state institutions to inform President Jokowi about the global outbreak and to prepare the evacuation of Indonesians from Wuhan, China, which is the disease’s epicenter, and from the coronavirus-hit Diamond Princess cruise ship docked at Yokohama, Japan.

The presidential spokesman for all coronavirus-related matters, Achmad Yurianto, has denied all allegations against Terawan and said that the minister had given instructions for several measures to be conducted since December last year.

More Indonesians test positive for COVID-19, measures intensified Republika, headline; Koran Tempo, Berita Utama; Kompas, headline

The government announced on Sunday that two more Indonesians, referred to as cases 5 and 6, had tested positive for the COVID-19 coronavirus, increasing the confirmed COVID-19 cases in Indonesia to six. The presidential spokesman for all coronavirus- related matters, Achmad Yurianto, said case 5 was a 55-year-old man who was part of the “Jakarta cluster”, referring to the previous four confirmed COVID-19 cases in Jakarta who all had been infected by the virus during a dance. Meanwhile, case 6 was a 36-year- old man who was among the Indonesian crew members of the virus-stricken Diamond Princess cruise ship.

Responding to the increasing number of COVID-19 cases in the country, Foreign Minister Retno LP Marsudi has banned travelers who had been to Teheran, Wom and Gilan in Iran, Lombardi, Beneto, Emilia Romagna, Marche and Piedmont in Italy, and Daegu and Geyongsanbuk-do in South Korea in the past 14 days from entering or making a transit through Indonesia.

Gap with PDI-P hinders Dems from entering coalition Media Indonesia, p.3

In the past week, at least two separate meetings between political figures have sparked public speculation. The first one was a meeting between Democratic Party chairman Susilo Bambang Yudhoyono and Golkar Party chairman Airlangga Hartarto and the second was National Mandate Party (PAN) chairman Zulkifli Hasan’s visit to the State Palace to reportedly meet with President Joko “Jokowi” Widodo.

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Political analyst Ujang Komarudin of Al-Azhar Indonesia University said that even though Golkar and the Democratic Party might have discussed the possibility of cooperating together in this year’s regional elections, it was unlikely that the two parties aimed for further collaboration within the government coalition, of which Golkar is a member, considering the Democratic Party’s alleged distance from the ruling Indonesian Democratic Party of Struggle (PDI-P).

Meanwhile, according to Ujang, it is apparent that PAN has been trying to leave the opposition and enter the government coalition. This would not be the first time for PAN to make such maneuver considering its history of switching sides.

PDI-P’s Surakarta chapter refuses to support Gibran’s mayoral bid Republika, p.3

The Indonesian Democratic Party of Struggle’s (PDI-P) Surakarta chapter will reportedly remain solid in supporting an Achmad Purnomo-Teguh Prakosa ticket instead of one with President Joko “Jokowi” Widodo’s eldest son Gibran Rakabuming Raka in the 2020 Surakarta mayoral election.

The PDI-P’s Surakarta chapter’s support for Achmad-Teguh has been asserted by the chapter’s head and the current mayor of Surakarta, FX Hady “Rudy” Rudyatmo. While announcing the chapter’s support for Achmad and Teguh, Rudy also asked all party members in Surakarta to work hard to ensure the ticket’s victory in the regional election.

BUSINESS AND ECONOMICS NEWS AND HEADLINES

Looking for opportunities with Rp 50 stocks Bisnis Indonesia, headline

The number of stocks priced at Rp 50 each increased to 101 as of last Friday, up from Rp 35 stocks at the end of 2017. This serves as an opportunity to invest, especially for certain stocks that still have prospects.

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There are a number of stocks that need to be considered for investment, as long as they meet certain criteria, said PT Kanaka Hita Solvera senior vice president for research Janson Nasrial. Among those criteria are “reasonable valuation, price-to-book value at 0.5 times and manageable debt”.

He mentioned Rp 50 stocks that meet his criteria included PT Gozco Plantations (GZCO), PT Bank Ganesha (BGTG) and PT Sentul City (BKSL).

CSA Research Institute senior analyst Reza Priyambada added one more criteria, saying that investors need to look into the company’s fundamentals, especially the company’s financial records, whether it still books increasing revenues and profits.

One more, Reza said, even if the fundamentals are relatively good, but the stocks are not liquid, they are not worth the investment because it would be difficult to cash them in.

Reza recommended two Rp 50 stocks to invest in, PT Yeloo Integra Datanek (YELO) and PT Gading Development (GAMA). The two stocks had good performance in industries with relatively good prospects.

Accelerate adoption of second stimulus package Investor Daily, headline

Businesses have demanded the government accelerate the adoption of a second stimulus package to help businesses cope with the impacts of the coronavirus outbreak. They argue that businesses would run out of stocks of raw materials in the next two to three months. Therefore, they need government support to source raw materials from outside of China.

The government issued a first stimulus package worth Rp 10.3 trillion (US$735 million) to help industries directly affected by the coronavirus, such as those in the tourism sector, and to help drive up consumer demand by providing more cash to poor families. The first stimulus package, however, did not address problems faced by the manufacturing sector.

“The government should not maintain only the demand side, but also the supply side. Don’t only care about demand. What if there is no supply? It could spark rush buying,” said Suryadi Sasmita, deputy chairman of the Indonesian Employers Association.

Coordinating Economic Minister Airlangga Hartarto said the government plans to issue a second stimulus package that would be much bigger in value than the first package. The second package would consist of eight policies, four of which shall deal with import and export policies. The other four would be in the forms of fiscal policies.

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Finance Minister Sri Mulyani said her office would issue a number of tax incentives, including the postponement of the PPh 21 employee income tax payment by corporations.

Crude oil prices drop Kontan, headline

Crude oil prices dropped last week, with the West Texas Intermedia (WTI) for April delivery falling to US$41.28 per barrel and Brent price for May delivery declining to $45.27 per barrel.

One of the causes for the price drop was the failure of the Organization of Petroleum Exporting Countries (OPEC) to reach an agreement to cut outputs and, therefore, the market foresees more surpluses of supplies. Meanwhile, demand would continue to be weak as the coronavirus outbreak makes an impact.

“China’s economy is slowing down drastically and, therefore, demand will weaken,” said Kapital Global Investama analyst Alwi Assegaf.

The falling crude oil prices would affect publicly listed oil companies, such as Medco Energi Internasional (MEDC). Medco president director Hilmi Panigoro said that every US$1 per barrel drop in crude oil prices would affect the company’s EBITDA by $10 million.

Despite the falling prices, MEDC said it would maintain its production level and even increase it to 110,000 barrels of crude oil per day.

TRFX Garuda Bejangka director Ibrahim said that crude oil prices would continue to slide as demand is lacklustre. He predicted the prices could dip further to $37 per barrel. Crude oil prices would recover only when the manufacturing sector recovers. Ibrahim predicted that crude oil prices would likely recover in the third or fourth quarter of this year.

Govt's virus response to raise debt, lower revenue: Experts The Jakarta Post, headline

The government’s big-check fiscal stimulus to bolster purchasing power and tourism- and trade-related industries amid the coronavirus (COVID-19) outbreak will reduce state revenues and raise debt levels, economists say. They have called for productive spending to support the economy.

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Center of Reform on Economics (CORE) Indonesia research director Piter Abdullah said the planned stimulus packages would “no doubt” increase debt levels and widen the budget deficit and he called on the government to manage the budget efficiently while providing the much-needed stimulus.

“The government needs to be smart about the stimulus to ensure the fiscal deficit remains below 3 percent,” Piter told The Jakarta Post by phone on Wednesday.

The government is working to finalize eight measures that are to be incorporated in a second stimulus package aimed at easing rules for exports and imports, as supply chains continue to be disrupted by the spread of the coronavirus. The measure follows the unveiling of a Rp 10.3 trillion (US$725 million) stimulus package last week to support consumer spending and tourism.

“The stimulus packages, while needed, will no doubt widen the budget deficit and must be communicated well to the public,” said Piter, adding that the budget deficit was reasonable amid the current circumstances.

The government collected Rp 103.7 trillion in January, down 4.6 percent from the same month last year. Meanwhile, government spending reached Rp 139.8 trillion, down 9.1 percent compared with the same period last year. It resulted in a budget deficit of Rp 36.1 trillion, 0.21 percent of gross domestic product (GDP) in January.

The country recorded debt of Rp 4.82 quadrillion in January, a 30.21 percent debt-to- GDP ratio, a level unseen since the 2008 financial crisis when it was 30.25 percent.

People want improvement of maritime highway: Survey Kompas, p. 1

A Kompas survey covering 544 respondents in 30 regencies and mayoralties from Feb. 29 to March 1 shows that the majority of them (51.84 percent) know of the government’s maritime highway, but 47.98 percent do not know of it.

The majority of the respondents (79.41 percent), both those who know and do not know it, believe that the maritime highway should benefit more the frontier, outermost and least developed regions.

The maritime highway, aimed to reduced price disparities between the western and eastern parts of Indonesia, has not achieved the target.

Hendra Loa, 40, in Biak Numfor, Papua, said that he used to benefit from the maritime highway vessel service to transport rice and sugar, but it cut the price by only Rp 1,000 and Rp 3,000 per kilo respectively. Hendra said he did not use the service of the maritime highway vessels anymore as their schedule is not reliable.

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Indonesia’s northern most island of Miangas has another story. Traders on the island could not benefit from the maritime highway container vessels. As a result, the vessels do not stop anymore at Miangas, although Miangas is one of the stops that should be served by the maritime highway vessels. Therefore, prices of basic commodities on the island remain high.

Prices of basic commodities in East Nusatenggara and Maluku also remain high despite that the areas are also served by the maritime highway vessels.

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