Tensions within Indonesian parliament may have eased after the two opposing coalitions signed a limited power-sharing pact on Monday (17/11) after weeks of negotiations. This pact is expected to reinforce investor confidence in Indonesian politics amid improved political certainty. Previously, parliament was divided into two rival coalitions: the Awesome Indonesia Coalition (Koalisi Indonesia Hebat), which backs Indonesian President Joko Widodo, and the Red-White Coalition (Koalisi Merah-Putih), which is led by Prabowo Subianto.

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After weeks of uncertainty, Indonesian President Joko Widodo announced on Monday (17/11) that prices of subsidized fuels (gasoline and diesel) are to be raised by IDR 2,000 (USD $0.16) per liter starting from midnight. Gasoline (premium) is to be raised from IDR 6,500 to IDR 8,500 per liter, while diesel will be raised from IDR 5,500 to IDR 7,500 per liter. Earlier it was speculated that an IDR 3,000 per liter price hike would be announced. However, as global oil prices have declined sharply, this was considered an unnecessary burden for the people.

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After speculation started to rise that Indonesia would perhaps not raise prices of subsidized fuels (gasoline and diesel) in November as recent declining global oil prices have managed to somewhat relieve the government’s budget deficit, Indonesian Finance Minister Bambang Brodjonegoro said over the weekend that the Indonesian government is still eager to raise these prices within a couple of weeks. However, he added that the price hike will be less than IDR 3,000 (USD $0.25) per liter.

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The ceramic industry in Indonesia is expected to grow about ten percent in 2015 amid the country’s +5 percentage point GDP growth. Economic expansion translates to increased purchasing power of Indonesian consumers and the ceramic industry is one of the industries that will benefit from this. Moreover, as Indonesian President Joko Widodo targets +7 percent GDP by the end of his term, new infrastructure and property projects are to rise as well. As such, domestic ceramic demand will increase accordingly.

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Today is Hari Pahlawan (Heroes’ Day) in Indonesia. On this day, which is always celebrated on 10 November, Indonesia commemorates those people (posthumously) that have made a significant contribution to the country. Currently, the list of Indonesian heroes numbers 163 people (only 12 of which are women), and most of whom were involved in the battle against colonialism. Each year, the Indonesian president can add names to this list. This year, Indonesian President Joko Widodo added four names.

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Statistics Indonesia announced on Wednesday (05/11) that economic growth in Indonesia reached 5.01 percent year-on-year (y/y) in the third quarter of 2014. This result was slightly below analysts’ forecasts and implies that the slowing trend of economic expansion in Southeast Asia’s largest economy continues. Since 2011, gross domestic product (GDP) growth has been declining amid global and domestic developments. The 5.01 percentage point GDP growth in Q3-2014 was the slowest quarterly growth pace in five years.

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Jusuf Kalla, Vice President of Indonesia, confirmed that subsidized fuel prices will be raised this month. Although Kalla declined to announce the specific amount, analysts expect a sharp increase of between IDR 2,000 and 3,000 (roughly USD $0.21) per liter - a price hike of almost 50 percent - to prices of both gasoline and diesel. Currently, the price of premium gasoline is IDR 6,500 (USD $0.54) per liter and diesel IDR 5,500 (USD $0.46). Economists have long requested for higher subsidized fuel prices in Indonesia as these distort the economy.

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The administration of Indonesian President Joko Widodo (popularly known as Jokowi) will not give priority status to the Sunda Strait Bridge project. As such, the new government’s stance is in direct contrast to the previous administration’s stance toward the ambitious infrastructure project. The Sunda Strait Bridge, a planned road and railway connection between the two (westernmost) Indonesian islands of Sumatra and Java, was placed high on the agenda of the government led by Susilo Bambang Yudhoyono.

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On 2 November 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic matters such as GDP growth in the third quarter of 2014, an October inflation update, developments in coal mining, Internet connectivity, Soechi Lines’ IPO, Joko Widodo’s new cabinet, and more.

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The new cabinet of Indonesia, which had been announced by Indonesian President Joko Widodo on Sunday (27/10), will be inaugurated this morning at 10:30 am local Jakarta time zone, followed by a plenary cabinet meeting at 14:00 pm. Reactions from people and markets are mixed. Although it is positive that the cabinet includes several professional technocrats (contrary to political party politicians) on key positions such as the Finance Ministry and the Coordinating Ministry for Economics, there is criticism on the ‘reformist nature’ of the cabinet.

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Indonesian President Joko Widodo kicked off his short European tour on Monday (18/04) in Berlin (Germany) where he met German Chancellor Angela Merkel. Bilateral relations between Indonesia and Germany are important because Germany is Indonesia's largest trading partner in the European continent and Indonesia's seventh-largest investor. Merkel praised Indonesia's economic development amid the complex context (having more than 255 million citizens and consisting of over 17,000 islands). Both state heads talked about strengthening existing partnership in vocational education in several sectors.

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Indonesian President Joko Widodo has ordered the nation's Minister of Environment and Forestry Siti Nurbaya to issue a moratorium on new palm oil concessions in a number of provinces. Although Widodo wants Indonesia - the world's top producer and exporter of crude palm oil (CPO) - to raise CPO output, he believes this increase can be achieved by increasing productivity of existing palm oil plantations, not by adding new plantations. Indonesia is often criticized by environmentalist groups for its forestry policies and poor law enforcement (which led to the severe haze that spread through Southeast Asia last year).

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Indonesian President Joko Widodo (Jokowi) called for an investigation into the Indonesian people and companies mentioned in the Panama Papers, the massive leak involving 11.5 million confidential documents from the database of Panama-based law firm Mossack Fonseca. These documents list names numerous people - including of political figures, businessmen, celebrities and sport stars - who have created secret shell companies and offshore accounts in tax havens (possibly in an effort to avoid tax obligations).

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Indonesian President Joko Widodo decided that the Masela liquefied natural gas (LNG) plant will be constructed onshore. Masela, located in the Arafura Sea (Moluccas), is Indonesia's largest deep-water gas project. Previously, Japan-based oil company Inpex Corp and Netherlands-based Royal Dutch Shell proposed to construct the LNG plant offshore (which would have made it the world's largest floating LNG plant). On Wednesday (23/03) President Widodo rejected the proposal after months of polemic. Contractors Inpex and Shell are not expected to withdraw from the project but will need time to adjust plans.

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Indonesian President Joko Widodo may visit the Netherlands in 2016. In an interview with Dutch newspaper "De Telegraaf" newly appointed Indonesian ambassador to the Netherlands Gusti Agung Wesaka Puja hinted at Widodo's visit to the Netherlands. Ambassador Puja informed further that more information about this possible state visit is to follow in the next couple of weeks. "You will be surprised," he was quoted saying. Reportedly, Bert Koenders, Dutch Minister of Foreign Affairs, will visit Indonesia in the next two weeks to prepare Widodo's visit.

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A new financial management system was launched in April 2015 by the Indonesian government. This new system, called Sistem Perbendaharaan dan Anggaran Negara (abbreviated SPAN), aims to enhance public efficiency, transparency and accountability in Indonesia by managing the financial transactions of more than 24,000 government spending units in all 33 provinces. According to a new World Bank story, Indonesia's new financial system has managed to improve efficiency, transparency and accountability. Moreover, it improves budget planning and spending.

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During Indonesian President Joko Widodo's visit to Googleplex, Silicon Valley (California) - headquarters of Google, Facebook, Twitter and Plug and Play - he emphasized that the government of Indonesia is committed to push for the development of the digital economy, aiming to make it the largest in Southeast Asia, worth USD $130 billion by 2020 (including the emergence of 1,000 Indonesian technopreneurs). In this context, Widodo also requested the assistance of Google, Facebook and Plug and Play in the form of IT development education.

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After having grown rapidly in the years 2010-2013, infrastructure development in Indonesia lost its momentum in 2014. This was due to limited available government funds, uncertainty caused by the legislative and presidential elections, and the nation's slowing economic growth. After Joko Widodo became Indonesia's seventh president in October 2014, it was expected that infrastructure development would revive. However, it didn't. But Widodo made one important move by seriously reducing energy subsidies, hence making more funds available for infrastructure development.

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Merespon ekonomi global yang melambat, Presiden Joko Widodo telah mengumumkan paket kebijakan ekonomi yang baru yang bertujuan untuk mendongkrak pertumbuhan ekonomi Indonesia di tengah ketidakjelasan yang tinggi dalam konteks global. Pada hari Rabu (09/09), Joko Widodo (dikenal dengan panggilan Jokowi) memberikan sejumlah detail mengenai fase pertama ini dalam sebuah pidato di Istana Negara di Jakarta.

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Indonesian President Joko Widodo (often called Jokowi) emphasized that the government of Indonesia needs to boost development of renewable energy. Although Indonesia contains huge potential for renewable energy (particularly geothermal energy), the share of renewable energy in Indonesia’s total energy use currently stands at around 5 percent only, the remainder being fossil energy. By providing incentives, attractive tariffs and an easier licensing and registration process, the government can generate more investment in this sector.

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