Coordinating Minister Luhut on Export of Semi-Processed Mineral
Many are waiting for the Government’s decision on their policy regarding export of semi-processed mineral. As it stands, the Government is ready to apply relaxation to the export ban for copper only. But this is not yet a final decision. The Government still has to promulgate a Government Regulation for the matter, but given the urgency this has to be done by today. Yesterday afternoon, we briefly spoke to the Coordinating Minister of Maritime Affairs Luhut Binsar Panjaitan and asked about the Government’s latest position on this issue. The following is what Luhut said:
CPO & Paper: Declining Export
Indonesia exported 25.7 million tons of crude palm oil (CPO) in full-year 2016, a 1.9% year-on-year (y/y), declined from 26.2 million tons of CPO shipments in the preceding year, according to the data supplied by the Indonesian Oil Palm Estate Fund (BPDP-KS). In terms of value, however, Indonesia’s CPO exports actually surged 8% (y/y) to US$17.8 billion in 2016. Indonesia is the world’s largest exporter and producer of palm oil, followed by Malaysia. The rebound in CPO prices, coupled with the diversification of CPO products (creative industry) would boost CPO export this year.
Salim Group’s Expansion in the Philippines
SGX-listed QAF Limited, controlled by the family of Andree Halim and his brother of Antony Salim (Salim Group), has decided to expand its businesses in the Philippines. The group intends to expand bread production and distribution in the country. What about plans from Nippon Indosari, producer of the famous Sari Roti brand, to expand in the country?
The Latest on Export of Semi-Processed Minerals
President Joko “Jokowi” Widodo will have to decide on what to do with export of semi-processed minerals by tomorrow, January 11. The Government is supposedly prepared to allow export of processed minerals for copper—which entails providing an exception to Freeport Indonesia and Amman Mineral Nusa Tenggara (new name of Newmont Nusa Tenggara)—by promulgating a Government Regulation. But to this day, that Government Regulation has not been signed, and there doesn’t seem to be any clarity on what would happen next.
Shenhua’s Grip in Indonesia (3)
Shareholders meeting of China Shenhua Energy Co Ltd, one of the largest integrated energy companies in the world, on December 23, 2016 approved the provision of guarantee to PT Shenhua Guohua Lion Power Indonesia (Lion Power), paving the way for smooth construction of 2×300 MW mine-mouth power plant in Muara Enim, South Sumatra province.
Infrastructure Journal No. 01/2017
Infrastructure development would remain Indonesia’s main story to tell for 2017. As some of major infrastructure projects entering final phase of construction, the chance is bigger to see investments start coming into the country. Improved quality of infrastructure is expected to reduce logistic costs. Tourism industry, which contributes 11% of Indonesian GDP, is also expected to grow faster.
Revisiting Prabowo’s Kertas Nusantara
National media continue to speculate on possible joining of Gerindra Party led by Prabowo Subianto in the Jokowi-Kalla administration. Others, meanwhile, start to speculate on assets owned by Prabowo. In this issue, we focus on PT Kertas Nusantara, which operates a bleached kraft pulp mill in Berau Regency, East Kalimantan province.
Property Players to Watch: Provident Development
Provident Group as we all know is one of Indonesia’s leading business groups through companies like PT Tower Bersama Infrastructure Tbk (TBIG) and PT Provident Agro Tbk (PALM), both of which are joint ventures with Saratoga Group of tycoon Edwin Soeryadjaya. Provident and Saratoga are also partners in some gold-copper-silver mining operations in Indonesia.
Tourism Industry 2017 & Garuda Indonesia
The government has set an ambitious target to welcome 15 million foreign tourists this year, jumped by 25% from 2016 target. Tourism industry’s contribution to Indonesian Gross Domestic Product (GDP) is expected to grow from 11% last year to 13% this year. Some doubt, but others shared optimism, especially positive trend in the second half of 2016.
Traction on Mining Contract Affairs
The Minister of Energy & Mineral Resources (ESDM) Ignasius Jonan and Vice Minister Arcandra Tahar have drafted the Government Regulation (PP) on the 4th revision of the PP No. 23/2010 Concerning Mineral and Coal Mining Activity. This new PP is meant as a way to encourage Contract of Work (CoW) holders to transition into Special Mining Business Permit (IUPK). This transition should address issue with contract renegotiation timing and export of ores.