Editor’s corner Dear Readers, In 2008, Indonesia is export rose 20 percent to 136.76 billion dollars, while imports surged 73 percent to 128.79 billion dollars. The trade surplus for the year dropped H.E. M. WAHID SUPRIYADI sharply to 7.97 billion dollars from 39.93 billion in 2007. Ambassador Extraordinary and Plenipotentiary Realizing the possibility of a negative impact from the JOKO SANTOSO Minister Counsellor/ current global crisis, such as reduced demand for export goods from Political Affairs developed countries, the government will pursue a ‘top priority’ market- NICO ADAM seeking campaign in 2009. UAE is one of the major new destinations for First Secretary/ export market expansion. Economic Affairs M. ARIF HIDAYATULLAH At the beginning of the year, the Indonesian Embassy in Abu Dhabi has Second Secretary/ Economic Affairs made an agreement with EMKE Group to promote Indonesian products in the UAE through an Indonesian Festival at all Lulu Supermarkets in UAE. ABDI SATYA UTAMA Second Secretary/ This project is part of efforts to penetrate the global market with Indonesian Information, Social and Cultural Affairs products to UAE’s market. HANAN HADI Third Secretary In order to maintain awareness about Indonesia, the Embassy has also Protocol & Consular Affairs been active in promoting cultural diplomacy by introducing the richness of SUKARTONO DALIL Indonesian cultures through cultural performances at Global Villages as Administration Officer well as at Abu Dhabi Cultural Foundation on 2nd of March. ASDEDI Administration Officer Enjoy the current edition and wish you good luck in 2009. THE EMBASSY OF THE REPUBLIC OF INDONESIA Zone 2, Sector 79, Villa No. 474 Nico Adam Sultan bin Zayed Street (Street- Editor in Chief 32), Al Bateen Area P.O. BOX 7256 Abu Dhabi, United Arab Emirates Phone : +971 2 445 4448 Fax : +971 2 445 5453 E-Mail :[email protected] Content : [email protected] Website: www.indoemb.org/kbri/ • SBY kicks off Batam free trade zone .................... 3 Design Graphics and Layout: • President Yudhoyono calls on businessmen Nico Adam to remain steadfast .................................................. 4 • Minister hopes new forestry programs can stop deforestation .................................................. 5 • Log Export expected to raise timber price ........ 6 • ASEAN, India to ink FTA soon, boost trade by 30% ........................................................................ 7 • Islamic retail bonds on offer in January ............. 8 • Riau Islands Province ................................................ 9 • Exhibition and Promotion Event .................................11 Bintan Resort Beach, Bintan Islands (Nico Adam) • Gallery .......................................................................... 12 2 INVESTMENT SBY kicks off Batam Free Trade Zone resident Susilo Bambang Yudhoyono has officially launched the much- Pdelayed Free Trade Zone for Batam, Bintan and Karimun in Riau Islands. The launching, ending five years of legal uncertainty for businesses, was marked on Monday (19/1) by the issue of new government regulations on customs, tax and duties for goods entering the three islands. Companies operating in the islands will no longer pay value- added tax (VAT), import duties and luxury tax, spurring hope that more foreign businesses will invest in the islands to tap low production costs. “All necessary legal supports are now there to turn the islands into Map of Riau Archipelago, Singapore and Malaysia a free trade zone,” said President Yudhoyono also investment, more than double the Yudhoyono, accompanied by inaugurated eight projects in the $484 million received in 2006. Trade Minister Mari Elka Pangestu manufacturing sector worth Karimun alone attracted $700 and Investment Coordinating US$604 million, three in the million last year. “We are upbeat Board chairman Muhammad tourism sector valued at Rp 250 that with all the legal hurdles Luthfi. billion (US$22.3 million) and one cleared, foreign investment will port project worth Rp 1.2 trillion, significantly rise,” he said. “If you hear there are still as well as two hotel expansion obstacles to doing business here, projects worth $30 million. These Batam, Bintan and Karimun are including illegal fees, please projects will create more than just 30 minutes from Singapore by informed me directly. I will take 12,000 new jobs. ferry. Indonesia and Singapore stiff action against those who have already signed a deal for dare to disturb the business Riau Islands governor Ismeth massive investment in the three community here.” he said. Abdullah said that legal islands. uncertainties for foreign investors, However, Singapore businessmen who had been had been hesitant to invest reluctant to come in heavily in the islands until they before, were now were sure of clarification of past settled. Ismeth said uncertainties concerning investment in the governance, administration and Riau Islands now management of the free trade exceeded $11 billion zones. from more than 1,150 foreign companies. Under new government regulations, loading and In 2007 Riau Islands unloading of all imports and attracted about $1 exports can only be done at five billion in new ports; Batu Ampar, Kabil and M. Lutfi as a Chairman of Investment Coordinating Board is Sekupang in Batam, Loban in welcome foreign investment to Batam Free Trade Zone. 3 Bintan, and Parit Rompak in Karimun. President Yudhoyono calls on “Exports and imports done businessmen to remain steadfast outside these ports are illegal,” said Riau Islands custom chief Nasir Salim, adding goods resident Susilo Bambang entering the islands were not Yudhoyono called on allowed to be sold in other parts business companies of Indonesia unless they paid Poperating in the Free Trade Zones necessary taxes. in Batam, Bintan and Karimun to remain steadfast in the current “We have prepared patrol boats global economic crisis. that will guard the islands 24 hours a day. We will specifically He made the appeal during a monitor loading and unloading dialogue with Indonesian and activities outside the five ports. Singaporean businessmen at Turi And believe me the sanctions will Beach Resort here on Monday be harsh,” he said. evening(19/1). Batam’s main industries are “While the storm is not yet over, electronics, manufacturing and it is certain that exports will drop shipbuilding. Bintan, with its whereas Batam, Bintan and garment and electronics Karimun are relying on exports. manufacturing industries, So I ask for your understanding The head of state said the measures 4,063 square kilometers. that the world market is indeed essence of economic recession is Karimun, renowned for its deep- weakening and shrinking. Well declining demands and sea port, covers an area of 8,000 this year we have to struggle to therefore the only way to solve square kilometers. survive, so that in time later we the problem would be could rise again,” he said. safeguarding demands. Chairman of the Indonesian Chamber of Commerce and To ease the burden of President Yudhoyono also called Industry for Riau Islands chapter businessmen, the President said, on the people not to cut their Johannes Kennedy Aritonang the government has since spendings. “Those who can said there would need to be September 2008 cooperated afford to buy things need to keep much work in the field to ensure with the central bank and some buying so that products from the all the government’s promises businessmen to issue special real sector are maintained. Let were met. policies such as government us act like business is as usual in regulations in lieu of laws, a positive sense,” he said. “We will now see incentives, stimulus and others. implementation in the field. Will The President said the general the islands become more “They are all aimed at calming elections Indonesia would hold attractive as planned or not?” the market and reducing the in the near future would be one said Johannes. burden of businessmen to of the forms of economic maintain the real sector,” he movement. said. “Indonesia will conduct general To maintain the people‘s buying elections. A lot of colourful flags power, the business community have been raised and in the not needs to give their contribution too distant future campaigning by reducing prices if possible, he will be done and in April voting said. for legislative candidates will take place which will be “If there is an opportunity to followed later by presidential maintain prices or even lowering elections. The business. I appeal them, demands will be to parties to raise as many flags maintained, and there will also as possible, make as many be buyers,” he said. campaign T-shirt as possible and Kiaikanjeng perform at AD Cultural Foundation 4 TRADE hold as many music performances as possible so that Minister hopes new forestry singers get a fortune and economy is moving,” he said. programs can stop deforestation He said the government was ready to lose or to see the foreign exchange reserve drop so long as people did not lose. Regarding the country‘s economic condition President Yudhoyono said quoting “The Economist” that it was so far so good. “I think it was issued last week. There was a small article about Indonesia there titled “So far so good”. Articles written by the Economist or the Times must have no political motives,” he said. ew forestry programs around forest areas, and forest It was said Indonesia‘s economy were expected to be consolidation,” Kaban said. grew 6.3 percent in 2007 and 6.1 successful in