INDONESIA PROJECT NEWS No. 1 January–August 2006 Going Public Welcome to the first issue of Indonesia Project News. Recognising the need to communicate more regularly with fellow professionals, government and the community, we plan to publish this newsletter on a trimester basis. It will provide news about Project activities—the contents of our journal, the Bulletin of Indonesian Economic Studies; the holding of seminars, conferences and public events on Indonesia; publications; the hosting of Indonesian and international visitors; and staff activities both on and off campus, in Australia and abroad. Comments or queries on material included in the newsletter are welcome, and should be directed to: [email protected]. It seemed fitting to launch our first number on August 17, Indonesia’s Independence Day, its 61st. This issue covers events in the first eight months of 2006. Selamat membaca — happy reading. Highlights • Publication and launches in Jakarta, Singapore and Canberra of the Indonesia Update book, Different Societies, Shared Futures: Australia, Indonesia and the Region, ed. John Monfries (Institute of Southeast Asian Studies, Singapore, 2006). • Workshop on Development and Environment in Eastern Indonesia: Papua, Maluku and East Nusa Tenggara, convened by Budy Resosudarmo and Frank Jotzo, and held on April 8 at the ANU. • Public lecture on Trade and Investment: Prospects and Challenges Ahead for Indonesia by Indonesia’s Minister of Trade, Dr Mari Pangestu, hosted by the Indonesia Project at the ANU on August 10. Indonesia Project Economics Division Research School of Pacific & Asian Studies ANU College of Asia & the Pacific Update Book Publication Affairs, the Hon. Ms Teresa Gambaro Different Societies, Shared Futures: Austra- MP, was held at the ANU in Canber ra on lia, Indonesia and the Region ed. John August 9, and attended by the Indonesian Monfr ies (Institute of Southeast Asian Ambassador to Australia, Mr Hamzah Thayeb Studies, Singapore, 2006). (pictured below), and an audience of some 50 people. This book is the product of the 23rd Indo- nesia Update conference, and was well and truly launched by mid August, with events i n Jakarta, Singapore and Canberra. Speakers focused on many themes adum- brated in the book — the unpredictability of the relationship, the often highly emotional nature of public reaction on both sides and, on the other hand, the close and construc- tive cooperation in disaster relief and reha- bilitation and in multilateral forums. A very successful and well-attended book International Workshop launch and all day seminar were held in A workshop on Development and Environ- Jakarta on July 4. The opening address was ment in Eastern Indonesia: Papua, Maluku given by the Indonesian fore ign minis- and East Nusa Tenggara, attended by some ter, Hassan Wi rayuda, with a response by 90 participants, was held on April 8 at the the Australian Ambassador, Wi ll iam ANU. Convened by Budy Resosudarmo and Farmer. The seminar featured book con- Frank Jotzo, it covered developments and tributors including former Indonesian Am- policies for balancing environmental con- bassador to Australia Wiryono, and Indonesia cerns with economic development in the Australia Business Council president Noke poor provinces of Eastern Indonesia. Work- Kiroyan. Valuable contributions were made shop topics included forestry, fisheries, bio- also by the trade minister, Mar i Pang- diversity, mining and health, as well as local estu, former foreign minister Ali Alatas, par- and trans-boundary issues. Papers were pre- liamentary member Muhammad Hikam, and sented by Australian, Indonesian and other senior Australian journalist Patrick Walters. international researchers and policy makers. The workshop was supported financially by AusAID, the multi-donor Support Office for Eastern Indonesia (SofEI), and the ANU Col- lege of Business and Economics. Details at http://rspas.anu.edu.au/economics/ip/eastina/. William Farmer, Hassan Wirayuda, Hadi Soesastro and Chris Manning at the Jakarta launch of Different Socie- ties, Shared Futures. On July 5, approximately 50 people attended a launch in Si ngapore by the Australian Trade Minister Speaks at ANU High Commissioner, M iles Kupa, at the The Project hosted a public lecture by Indo- premises of the book’s publisher, the Insti- nesia’s Mi nister of Trade, Dr Mar i tute of Southeast Asian Studies (ISEAS). Fi- Pangestu, at the ANU on August 10. Dr nally, a third launch, by the Australian Pangestu, a graduate of the ANU, spoke on Parliamentary Secretary for Foreign Indonesia’s new reform program, and espe- Indonesia Project News 1/2006 2 cially on initiatives the government is taking the labour law in the context of difficulties to restore the investment climate in Indone- in overcoming the employment problem. sia, including plans for new export process- Policy-oriented papers published in the BIES ing zones and regulatory reforms. The in April included Ross McLeod’s critical as- address was chaired by the ANU Vice Chan- sessment of the role of a new Deposit Guar- cellor, Professor Ian Chubb, and attended by antee Agency, Gustav Papanek’s questioning some 120 people from within and outside of the popularly held view that small in- the University. digenous businesses need ‘infant industry’ assistance, and Tim Stapleton’s paper show- ing how policies claiming to assist sugarcane farmers may have quite different objectives and outcomes. In August, the policy focus was on measuring efficiency in public ad- ministration, specifically tax collection at the local level (Blane Lewis), and comparing In- donesia’s export performance and policies in manufacturing with those of neighbouring countries (Prema-chandra Athukorala). Other recent papers in the BIES include: Pi- erre van der Eng’s comparison of rice agri- culture in colonial Java and Japan; Stephen Papua–PNG Cooperation Grenville’s review article evaluating former In February–March, the Project helped or- Bank Indonesia governor Soedradjad Dji- ganise a workshop on cross-border economic wandono’s book on the bank’s role in the cooperation between Papua New Guinea and late 1990s financial crisis (April); Armida Al- Indonesian Papua in Daru, PNG, and meet- isjahbana and Chris Manning’s paper on pov- ings in Merauke, Papua. The activities were erty and labour; and Ann Marie Murphy and sponsored by the Papua New Gui nea Sus- Hadi Soesastro’s tribute to the remarkable tai nable Development Program and influence of the late Professor John (‘Jack’) AusAID. They were attended by Budy Reso- Bresnan on Indonesia’s progress during the sudarmo and Chris Manning on behalf of the last half-century (August). Project, and underpinned the need for con- structive action for economic development Visitors in a very poor region on Australia’s doorstep. Besides local visitors presenting talks to the Indonesia Study Group, in June–August the Project hosted two prominent researchers from the University of Indonesia, Dr Suahasil Core Activities Nazara and Professor Bambang Brodjo– negoro, as well as Dr Catur Sugiyanto from Bulletin of Gadjah Mada University. Suahasil visited the Project for a month to work with Budy Reso- Indonesian Economic Studies sudarmo on lessons from the reconstruction Surveys of Recent Developments. The April efforts in Aceh and Nias. Bambang came for a economic survey by Ari Kuncoro and Budy shorter period and gave an enthralling talk Resosudarmo highlighted slow economic on recent progress in decentralisation. Catur performance within a booming global econ- worked on a paper from a World Bank omy, the positive impact of the courageous funded project on the impact of the Yogya- step to cut back on heavy government fuel karta earthquake on business. We also hosted subsidies, and recent rehabilitation progress Professor Armida Alisjahbana for a one-day in Aceh. In the August survey, Chris Manning discussion of the research strategy for a ma- and Kurnya Roesad dealt with achievements jor China–Indonesia research project on ru- in macroeconomic management and the set- ral–urban migration (see below for further ting of a clearly defined reform agenda, even details). though there have been some disappointing results in microeconomic policy. Their survey also covered recent conflict over revisions to Indonesia Project News 1/2006 3 Indonesia Study Group Fishing and the Environment. In May, Budy The Indonesia Study Group, coordinated by Resosudarmo presented a paper entitled Ed Aspinall, held seminars on a wide range of ‘South East Asian Perspectives’ to a public political, social and economic topics in the forum in Darwin, When People and Environ- first eight months of 2006. Highlights ment Collide in the Tropics, a part of the included an address by the Indonesian Am- Charles Darwin Symposium Series. Budy is bassador, HE Hamzah Thayeb, on bilateral re- conducting research into illegal fishing in lations, several seminars on Papua and on the Arafura Sea. Islam in Indonesian society, and an address on labour issues by the Head of the ILO Of- Advisory Activities fice in Jakarta, Mr Alan Boulton. Labour and Employment Research. In Febru- ary and March, Chris Manning worked with Kurnya Roesad on a project for the World Bank on Indonesia’s puzzling employment Other Activities trends and statistics. Participation in Trade Policy Review. Hal Hill, together with Conferences and Workshops Kelly Bird of the ADB and and Sandy Cuth- ISEI Conference. Hal Hill delivered a paper on bertson of the Centre for International Eco- ‘The Strategy of Indonesia’s Economic Trans- nomics, was engaged by the World Bank in formation’ at the 16th Convention of the In- the first half of 2006 to prepare a report for donesian Economics Association (ISEI) the Bank and Indonesia’s trade minister on in Manado, June 18–20. The convention, policy issues and options for managing in- whose theme was ‘Reformulating Indonesia’s ternational and domestic trade. Trade reform Economic Development Strategy’, was often occurs in an analytical vacuum, and opened by the President and closed by the the decision-making processes are informal Vice President, featured keynote addresses by and non-transparent.