Sales in Indonesia's plastic industry are expected to rise 6.5 percent to 4.3 million tons (roughly USD $8 billion) in 2016 supported by rising plastic and plastic products demand in those industries that use these materials (for example, Indonesia's food & beverage industry and the automotive industry). Fajar Budiono, Secretary General of the Aromatic, Olefin and Plastic Industry Association (Inaplas), said the year 2016 should be a good one for the plastic industry as the economy of Indonesia has started to stabilize after a prolonged slowdown.

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Indonesia has become one of the largest - if not the largest - tuna producing countries around the globe. It is estimated that Indonesia supplies about one million tons of the saltwater finfish per year or 16 percent of the world's total tuna supply. As such, the tuna fishing industry has become a vital component of Indonesia's fishing industry and an increasingly important foreign exchange earner within the overall economy. Susi Pudjiastuti, Minister of Maritime and Fisheries, is confident that Indonesia will enhance its key role in the world's tuna industry.

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The selling price of Indonesia's low cost green car (LCGC) has become more and more expensive. Initially, this type of car was launched on the Indonesian market in order to offer the people an affordable and relatively environment friendly car. However, rising selling prices of the LCGC and weaker purchasing power amid Indonesia's slowing economic growth trend that occurred since 2011 has made it harder for Indonesia's middle class to purchase a LCGC.

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Three Indonesian sectors are expected to be negatively affected by the government's proposal to impose an excise tax of at least IDR 200 (approx. USD $0.02) on plastic bottles and packaging. These three sectors are the food & beverage sector, the packaging sector, and petrochemicals. Last week, the Indonesian government unveiled its plan to introduce a new excise tax in an effort to collect additional tax money, while protecting the environment as the tax should lead to a reduction in consumption of plastic products. However, the plan led to fierce criticism from dozens of industry associations.

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The government of Indonesia proposes to impose an excise tax of at least IDR 200 (approx. USD $0.02) on plastic bottles and packaging. This proposal is part of talks about revisions to the 2016 State Budget (APNB-P 2016). Later this week, the government will discuss the matter with Indonesia's House of Representatives (DPR). Around the globe several countries (including Great Britain and India) have imposed such an excise tax on plastic bottles and packages, both for additional tax revenue and as a measure to protect the environment.

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The National Assembly of France agreed to impose an additional tax on imports of crude palm oil (CPO) and its derivatives used for the production of food products. An additional tax of 90 euro per ton (on top of the existing 104 euro per ton import tariff) is expected to be implemented in 2017. This tax increase is part of France's wider biodiversity bill that aims to reduce deforestation and protects French citizens from the negative health effects from consuming palm oil. Indonesia and Malaysia, the world's largest CPO producers have objected strongly to this higher tax.

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Otoritas Jasa Keuangan (OJK), lembaga Pemerintah yang mengatur dan mengawasi sektor jasa keuangan di Indonesia, menerbitkan sebuah roadmap untuk pengembangan berkelanjutan sektor keuangan, baik untuk jangka menengah (2015-2019) maupun jangka panjang (2015-2024). Ketua OJK Muliaman Hadad menjelaskan bahwa roadmap-roadmap ini, dibuat atas kerjasama dengan Kementerian Lingkungan Hidup dan Kehutanan, berisi panduan dan arahan untuk pengembangan sektor keuangan yang berkelanjutan di Indonesia.

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The global coal industry is still plagued by pessimistic sentiment. Not only has the global supply glut in combination with sluggish global economic growth put serious pressure on coal prices (while China introduced stricter coal quality tests on thermal coal imports), but most countries are also placing more emphasize on cleaner energy sources, which further curtail demand for coal. Coal prices are currently heading for a decade-low with January 2016 coal futures now at USD $52.55 per metric ton on the ICE Futures Exchange.

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The ongoing forest fires on parts of Sumatra and Kalimantan, brought about by people's slash-and-burn practices to clear land for palm oil and paper industries, are now labelled a crime against humanity by global media while Indonesia has turned into the world's largest daily carbon dioxide emissions surpassing China and the USA. The severe haze that has been plaguing parts of Southeast Asia brings health problems, economic costs and bad publicity amid a time when most countries are teaming up to combat global warming.

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Again schools were ordered to shut (for at least two days) in Malaysia in order to protect children from inhaling smog as the air quality remains at very unhealthy levels (nearly hazardous in some regions). The air pollutant index still shows readings of between 201 to 300 in six districts around Malaysia's capital city of Kuala Lumpur. The haze, which - reportedly - may become the worst haze ever, is caused by companies' and people's illegal slash-and-burn practices to clear land for planting on parts of the Indonesian islands of Sumatra and Kalimantan. The situation is exacerbated by the (El Nino-related) prolonged dry season.

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Currently, coal certainly ranks among the most interesting commodities. On the one hand, Indonesia expressed its commitment to reduce consumption of this dirty fossil fuel (that is especially used as raw material for the generation of electricity in power plants but also in various manufacturing industries such as the cement industry and textile industry) as the country seeks to become ‘carbon neutral’ by 2060 (although many doubt to what extent Indonesia is really committed to this ambition; after all, it has more immediate concerns such as the dozens of millions of Indonesians living below, and just above, the national poverty threshold).

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Those who’ve ever visited Indonesia should be well aware that the country is facing some serious environmental issues, with the underlying reason seemingly being low environmental awareness among the inhabitants of this beautiful country. Such low awareness is actually something that seems commonly shared among the people in developing nations, hinting that there exists a link between the level of per capita gross domestic product and the level of concern for the environment.

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Contrary to our usual coverage, in this edition of the monthly Indonesia Investments’ report there is some emphasis on political and socioeconomic developments in the West (referring to the United States and the European Union). The main reason for this is that the West – and we have seen this throughout history (for example during colonial days) – has a huge influence on the rest of the world, including Indonesia.

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The severe oil spill in the Balikpapan Bay (East Kalimantan) could lead to sanctions for Indonesia's state-owned oil and gas company Pertamina. Arcandra Tahar, Deputy Minister of Indonesia's Energy and Mineral Resources Ministry, said his ministry is joining forces with the Ministry of Environment and Forestry to investigate the oil spill case. Five fishermen were killed by toxic smoke, while it is feared that severe damage has been done to marine live and the ecosystem in the area.

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Stakeholders in Indonesia's pulp and paper industry are concerned about the future of this industry after Indonesia's Environment and Forestry Ministry suspended the operational activities of Indonesia's second-largest timber company, Riau Andalan Pulp and Paper (RAPP), through a decree. RAPP is a unit of global pulp and paper industry giant Asia Pacific Resources International (APRIL). Meanwhile, APRIL is a unit of Singapore-based Royal Golden Eagle.

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The World Wildlife Fund (WWF) unit in Indonesia said efforts to multiply Sumatran tiger populations (panthera tigris sumatrae) are constrained because those forest areas ("pockets of forest") that are the habitat of this endangered species has become increasingly small. Despite the challenges, Aditya Bayunanda, WWF Indonesia's Policy, Sustainability and Transformation Director, said the WWF continues to fight for the tiger. On Friday (28/07) WWF Indonesia launched the "double tiger" program (abbreviated as Tx2) in Jakarta.

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Non-governmental environmental organization Greenpeace blocked all import and export channels of crude palm oil (CPO) trader IOI on Tuesday morning (27/09) in the harbor of Rotterdam (the Netherlands), the city that acts as palm oil’s gateway into Europe. Greenpeace activists decided to take action after a Greenpeace International report showed that palm oil from companies that are reportedly involved in forest destruction, peatland fires and child labor is still flowing into Europe and the USA through IOI facilities.

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A year ago - between June and October 2015 - severe man-made forest fires on the Indonesian islands of Sumatra and Kalimantan released some 11.3 million tons of carbon per day, caused Indonesia to experience damages estimated at 1.9 percent of GDP (World Bank estimate), and spread toxic haze to other parts of Southeast Asia. Not only its regional neighbors but most of the world directed its anger at Indonesian authorities that failed to combat the fires, and more importantly, failed to uphold laws that forbid the slash-and-burn practice.

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Indonesia's Ministry of Energy and Mineral Resources will soon issue a moratorium on new coal mining concessions. This moratorium will be implemented after the issuance of a planned presidential instruction regarding a five-year moratorium on new palm oil plantation concessions. Heriyanto, Head of the Legal Department Directorate General of Minerals and Coal at the Energy Ministry, emphasized that the moratorium in Indonesia's mining industry only involves coal, not the mining of minerals.

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Domestic coal consumption in Indonesia rose 34.5 percent (y/y) to 24.5 million tons in the January-April 2016 period, according to data from Indonesia's Energy and Mineral Resources Ministry. This growth is caused by higher domestic coal demand due to Indonesia's ambitious 35,000 MW program (many of the power plants constructed in this program are coal-fired). Meanwhile, Indonesia's coal exports were down 14 percent (y/y) to 68 million metric tons over the same period amid sluggish global demand.

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