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Updated News August 30, 2010

Mon, 08/30/2010 - 16:24

In today's news, the government has said that as many as 10 state-owned companies would be ready to go public next year.

From the infrastucture sector, the government is speeding up the construction of the railroad track between Tanjung Priok port and Cikarang Dry Port integrated customs area (KPPT) to smoothen the dispatch of goods, and raise productivity and industrial capacity.

In the News:





Government Relations & Economic Development

Government Plans to Take Ten State Companies Public in 2011
Faisal Maliki Baskoro. The Jakarta Globe, Jakarta – 30/08/2010

Counting on continuing improvements to the economy and a surge in capital inflow on the stock market, the government has said that as many as 10 state-owned companies would be ready to go public next year.

“The Indonesia Stock Exchange [IDX] has been performing well. Demand for new shares in our stock market is high, and we need to capitalize on this opportunity by pushing more of our state enterprises to go public next year,” Mustafa Abubakar, the state enterprises minister, said on Friday.

Although he did not name the companies, he did say the targeted firms were from the insurance, agriculture, finance and construction sectors.

One of the companies could be construction firm Waskita Karya,  which in January announced plans to float 35 percent of its equity to raise Rp 600 billion ($66.6 million).

Other SOEs considering IPOs next year are construction company Hutama Karya, insurance company Jasindo, cement company Semen Baturaja and financing company Permodalan Nasional Madani.

Mustafa said the ministry was currently focused on preparing four IPOs before the end of 2010.

Two of those are Krakatau Steel, which is planning to raise Rp 3.3 trillion by selling 19.61 percent of its equity, and flag carrier Garuda Indonesia, which hopes to raise $400 million by selling 30 percent of its shares.

IPOs are also planned for Bank Mandiri and Bank Negara Indonesia, with targets of Rp 14 trillion and Rp 7 trillion, respectively.

The nation’s bullish economic outlook is attracting billions of dollars in foreign funds and the IDX said it expected to see twice as many companies go public this year compared to last.

Analysts say part of the confidence is due to the country’s good performance during the 2008-09 global financial crisis, which prompted some international rating agencies to upgrade the country’s sovereign debt.

The government is expecting around 6 percent GDP growth this year.

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Editorial: Let the Market Solve Problems With State-Owned Enterprises
The Jakarta Globe, Jakarta – 30/08/2010

If and when Indonesia’s state-owned enterprises are finally privatized, it will usher in a new era for the often poorly run firms. For years now, the government has been planning to list many of these companies on the stock market to raise fresh funds. But privatization will bring much more than just additional money; it will inject new ideas and professional management practices into the companies.

There are more than 140 SOEs in the country, the vast majority of them loss-making and badly managed, although to be fair, a number of them are world-class companies.

For many years, arguments have gone back and forth on just what to do with these firm.

Now the State Enterprises Ministry says that as many as 10 of its companies will be ready to go public by next year, as the ministry expects Indonesia’s economy to continue improving and see a surge in capital inflows.

Minister Mustafa Abubakar noted that with the stock market roaring, this would be a good time to list the better managed and more profitable companies.

Although he did not provide any names, he said the targeted companies were in the insurance, agriculture, finance and construction sectors.

Mustafa said the companies would prepare their IPOs starting early next year, and he was expecting that they could be ready by the end of the first half.

Analysts have highlighted a number of SOEs that could easily be privatized successfully. One such company is construction firm Waskita Karya, which plans to sell 35 percent of its equity to raise Rp 600 billion ($66.6 million).

Other state companies that are looking to be privatized next year are another state construction builder, Hutama Karya; state insurance company Jasindo; state cement company Semen Baturaja; and state finance firm Permodalan Nasional Madani.

Privatizing these companies through a series of IPOs is a good first step but Mustafa cannot stop there.

He must continue to aggressively consolidate non-performing SOEs or even shut them down completely if they are beyond salvation.

We must learn from our neighbors Malaysia and Singapore, where SOEs are run and managed purely on bottom-line imperatives.

It is clear that many of the companies managing some of the country’s strategic assets need a fresh injection of people and ideas.

The fact that the radar shut down for 30 minutes on Sunday at the Soekarno-Hatta International Airport is another red flag for the ministry to act quickly.

If professionally managed, SOEs can play a pivotal role in economic development and creating jobs. But they must stand on their own and not be subsidized by the state if the country and the nation are to realize maximum benefits.

Mustafa must be bold in undertaking critical reforms and acting with clear business logic if he is to reform the ministry and establish profitable SOEs that are leaders in their industries.

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Lack of incentives stalls investment in textile industries
The Jakarta Post, Jakarta – 30/08/2010

This is the last of four stories on Indonesia as an emerging hotspot for foreign direct investment.

Poor infrastructure and a lack of government incentives make Indonesia less appealing to foreign textile manufacturers, the Indonesia Textile Association (API) says.

API deputy chairman Ade Sudrajat said Saturday that several entrepreneurs from Singapore and China had actually expressed interest in relocating their factories to Indonesia, but the government could not ensure basic infrastructure such as electricity, gas supply and roads.

“Several businessmen, particularly from Singapore, who own factories in China and Korea, had expressed serious intentions of relocating their factories to Indonesia, but the talks always stalled on infrastructure issues,” he told The Jakarta Post.

Potential investors also thought twice about investing because the government did not offer interesting incentives, he added.

Ade said Indonesia was currently not an attractive destination for investments in the textile and textile products industry. Vietnam was more appealing because that country consistently implemented a one-stop service and its industrial areas were well managed, he continued.

“The Vietnam government directly operates its country’s industrial areas. These zones have advanced environmental management systems, road access and energy supply,” Ade said, adding that in Indonesia, the factories were sporadically spread out and only few were located in proper industrial areas, which were all owned by the private sector.

Most factories here did not employ advanced environmental management systems due to infrastructure constraints and this made growth in the textile and textile products industry unhealthy, he added.

Indonesia urgently needs more investments to absorb the growing number of workers. The Central Statistics Agency (BPS) said that in February, Indonesia’s workforce is estimated at 171.02 million people, up from 168.26 million last year. However, only 92 percent (116 million) of these workers were employed.

“We prefer investments in garments rather than textiles because the garment industry employs more workers and it takes a shorter time to set up the factories,” Ade said.

Currently, the textile and textile products industry employs more than 1.34 million workers.

The industry has shown steady growth in recent years. The Industry Ministry said that between 2000 and 2009, Indonesia’s textile and textile products exports grew 11.59 percent or 3.41 percent per year on average. In the last 10 years, the trade surplus remained above US$5 billion and even hit $5.09 billion in 2009.

The ministry says that in the first half of this year, the industry’s made up 17.4 percent of total exports with a total value of $4.95 billion, up from 8.7 percent in the same period last year. Since 2005, the US, South Korea, and Turkey remain the most important export markets for Indonesia. The ministry expects that this year, the total export value for the sector would be more than $10 billion.

Since 2005, the export value for textile and textile products commodities has grown consistently, from $8.6 billion in 2005, $9.45 billion in 2006, $9.81 billion in 2007, $10.41 billion in 2008 and dipped slightly to $9.26 billion in 2009 due to the global economic downturn.

To boost investments, Industry Ministry Director General for Metal, Machinery, Textile and Miscellaneous Industries Ansari Bukhari said the government had offered several incentives for investors such as exempting import duties on raw materials for two years and for machine imports.

“We also provide funds for machinery revitalization in the form of bank interest subsidies. This year, the allocation was Rp 175 billion,” he said. He added that through the subsidy, it was expected the financial sector would be incentivized to invest up to Rp 2 trillion.

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Energy and Mining

Denpasar stops gas terminal project
Wasti Atmodjo. The Jakarta Post, Denpasar – 30/08/2010

The Denpasar municipal administration has stopped the construction of an LPG terminal in Pesanggaran last weekend as the project has not yet secured the necessary construction permits, sparking protest from local residents.

The US$10 million terminal was designed to store up to 3,000 tons of LPG, equal to the capacity of the Manggis terminal in Karangasem.

State-owned oil and gas firm PT Pertamina said the project was crucial due to the island’s increasing dependence on LPG on the back of a government program converting kerosene users to LPG. More of the gas is also needed for tourism consumption.

Made Kusuma Diputra, head of the city’s Spatial Planning Agency, said his office had sent a notification letter to Pertamina, requesting the company discontinue all activities in the project.

He said Pertamina had committed violations by failing to secure any permit from his office, the licensing office or the environmental agency.

“We have discussed this case with city council, and I think all of us were cheated. That’s why we immediately sent the warning letter and urged Pertamina to register for official permits for the project.”

He added that the company should also get the approval of local residents. “Pesanggaran residents opposed the projects because they were wary about the possibility of an explosion. They also said the company lacks awareness on social and environment aspects. Pertamina should be held responsible for this.”

Wayan Wiraguna, a Pesanggaran resident, said he strongly opposed the project because it was too close to residential areas, putting residents’ lives at risk.

He said the project was also located near the Suwung dumping site and diesel power plant.

Residents said they often come across leaks in pipes channeling fuel from Benoa to the fuel depot at Pesanggaran, and that not much has been done to tackle the problem.

Frequency of recent LPG canister explosions has also unsettled them.

“These three facilities are located in one route and near our residential area. It makes us feel unsafe.”

Worse, he said, Pertamina has thus far only donated Rp 1 million of the Rp 1.3 billion they spent on building a public hall in their hamlet.

Hamlet representative Wayan Kari, confirmed the community had not approved the project. “We haven’t approved additional machines in the diesel power plants either. It’s the decision of 136 families.”

Head of the city council’s Commission C Kadek Agus Arimbawa said all work on the project should be halted, and suggested Pertamina reassess the project’s location in consideration of residents’ concerns.

Muhammad Iskandar, Pertamina’s general manager of fuel and retail said the company would discuss the project’s viability.

Totok Sugiharto, Pertamina’s sales representative of LPG and gas in Bali, said gas consumption in Bali has increased significantly, and that it was impossible to only depend on Manggis depot to supply the gas.

Manggis has the capacity to store 3,000 tons of LPG, he said, while Bali’s daily gas needs has reached 350 tons, which would be consumed in less than ten days.

According to Pertamina, the island’s annual LPG consumption in 2007 reached 55,120 tons. It rose sharply to 68,470 tons in 2008 and 80,011 tons last year.

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Pertamina budgets US$600 million to buy 18 tankers
Yuda Prihantoro. Bisnis.com, Jakarta – 30/08/2010

PT Pertamina (Persero) allocates US$600 million to buy 18 tankers this year in order to optimize the Pertamina's fleet until December 2012.

"The purchase of 18 tankers includes the purchase of five tankers from the local shipbuilders worth of US$ 87.38 million. The other 13 tankers are ordered from overseas builders,"  VP Corporate Communications Pertamina Mochamad Harun told Bisnis yesterday.

Harun said the addition is aimed to optimize the ability of Pertamina's oil shipping fleet. Besides, this purchase is a part of Pertamina's transformation programs to improve its service, efficiency, and reduce the dependency on the leased vessels.

Recently, Pertamina operates 190 tankers, including 36 vessels owned by Pertamina which is used to carry crude oil and other refinery products like fuel as well as LPG carriers.

The 18 tankers being ordered by Pertamina include three tankers with a capacity of 80,000 long tons of dead weight (LTDW), five 30,000-LTDW tankers, two 17,500-LTDW tankers, one 6,500-LTDW tanker, two 3,500-LTDW tankers, two LPG (Liquified Petroleumgas) vessels with a capacity of 23,000 cubic meters, an LPG vessel of 5,500 cubic meters, and two LPG vessels of 3,500 cubic meters.

The purchase of tankers and vessels will increase the capacity of Pertamina's cargo transportation from 64.9 million LT (Long Tons) to 67.3 Million LT in 2012.

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Transportation

Radar Crashes at Jakarta Airport
Nurfika Osman, Putri Prameshwari & Arientha Primanitha. The Jakarta Globe, Jakarta – 30/08/2010

As millions of Indonesians prepare to celebrate the Idul Fitri holiday by traveling to visit friends and family, the air traffic control radar that manages aircraft movements crashed at Soekarno-Hatta International Airport on Sunday morning, disrupting dozens of flights and exposing the country’s aging airport infrastructure.

The disruption, which lasted for 30 minutes, began at 9:02 a.m., and led state-owned airport operator Angkasa Pura II to temporarily switch the system to manual mode to minimize flight delays.

Hari Cahyono, corporate secretary of Angkasa Pura II, told the Jakarta Globe that more than 20 domestic flights were affected by the problem.

“At least nine planes that were scheduled to land were held back for about 10 to 15 minutes. At least 15 other flights were forcibly delayed,” Hari said.

He added that the measures were taken “for the safety and security” of passengers.

“No aviation company or pilot complained about this,” Hari said.  “We are still investigating the cause. It could have originated from our software or hardware. We realize people are wondering why the old system has not been replaced. It is not that simple. Yes, we have been using the same equipment since 1996, but we keep improving it.”

He promised that the beleaguered company would find a solution to the equipment problems and other infrastructure issues plaguing the airport.

“The last time the radar shut down in this manner was in June 2009,” Hari said.

This latest incident comes just three weeks after a two-second power outage at the airport caused chaos and delayed 62 flights. That incident, on Aug. 6, lasted just 1.7 seconds, but some flight management systems took hours to recover from the outage.

Tri Sunoko, chairman of Angkasa Pura II, said following the radar mishap that there would a “thorough audit of Soekarno-Hatta’s inventory” to identify which systems were fully operational and which were not.

The Ministry of Transportation plans to make Soekarno-Hatta and the main airports in Surabaya, Medan, Bali and Makassar international hubs prior to the Asean open-skies policy scheduled to come into effect in 2015.

This goal, however, might be too ambitious, considering the current state of the country’s airports.

Yudi Widiana Adia, a legislator on House of Representatives Commission V, which oversees transportation, told the Globe on Sunday that the latest incident sullied Indonesia’s reputation.

“How is this happening to an international-class airport? This taints Indonesia’s name abroad and surely it is representative of the quality of safety and security within Indonesian flight control [systems],” Yudi said.

“I am very disappointed. This case will have a very bad impact. Competition in aviation is very tight and we could lose out [to other regions in Southeast Asia] if blackouts or radar shutdowns occur like this.”

Yudi said hearings on the situation at the airport would be held at the House on Wednesday.

“The matter of safety and security is a matter in which there can be absolutely no compromise,” he said.

Dudi Sudibyo, a prominent aviation observer, was equally incensed. “Soekarno-Hatta is Indonesia’s No. 1 gateway,” he said.

“It is inexcusable to have such an incident. It’s time to rejuvenate the technology we use.”

Pujobroto, a spokesman for state-owned flag carrier Garuda Indonesia, confirmed that a number of the airline’s flights had been disrupted by the incident on Sunday morning.

“Our morning flights were delayed for several minutes when the radar went down,” Pujobroto said.

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Air operation for Aviastar tightens competition
Tularji. Bisnis.com, Jakarta – 30/08/2010

The issuance of air operation certificate (AOC) to Aviastar will tighten business competition in the air transportation sector despite the fact the airline will only work on the commuter market in eastern Indonesia.

The Ministry of Transportation (Kemenhub) earlier this week issued air operation certificate (AOC) to Aviastar and Tri-MG, the latter being a special cargo airline.

Secretary General of the Indonesian National Air Carrier Association (INACA) Tengku Burhanuddin revealed the additional airline would tighten competition among domestic air carriers.

However, he added, the segment explored by Aviastar was intercity or commuter segment, lessening the impact on the market share that had been competed for by other national scheduled airlines.

According to him, the market share in eastern Indonesia was still promising.

"The intercity market share for scheduled airlines in eastern Indonesia is still attractive."

Data by the Ministry of Transportation showed in 2009 the number of air transportation passengers reached 48.50 million persons consisting of 43.5 million domestic passengers and 5 million international passengers, rising 17% from 41.50 millions in 2008.

Lead market Lion Mentari Airlines is the domestic flight market leader by carrying 13.38 million passengers or 30.7% of the total market share, followed by Garuda Indonesia (8.40 million passengers), Batavia Air (6.11 millions), Sriwijaya Air (5.46 millions), Mandala Airlines (3.55 millions), Merpati Nusantara Airlines (1.95 millions), and Indonesia AirAsia (1.454 million passengers).

Director General of Air Transportation at the Ministry of Transportation Herry Bakti S. Gumay said the issuance of the AOC had been in line with the existing procedures.

"The AOC is only to legalize them since Aviastar has been operating as a charter airline."

He explained the entry of another scheduled airline in Indonesia would not disturb other airlines since Aviastar would explore a special segment, namely intercity and inter-regency flights in eastern Indonesia.

According to him, more AOCs were potential to be issued since the flight market shares in western as well as in eastern Indonesia were still promising. "I forgot how many companies have been asking for new AOCs.

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With First Phase Nearly Done, Boost Expected From Port Rail
Dion Bisara. The Jakarta Globe, Jakarta – 30/08/2010

The first phase of construction on a much-needed railway connecting Tanjung Priok Port with the country’s largest manufacturing park could be completed within three months, the coordinating minister for the economy, Hatta Rajasa, said on Saturday.

Hatta said the railway, which would be used to transport containers from the Cikarang Dry Port at West Java’s Jababeka industrial estate, would help take some of the burden off the heavily congested roads leading to Tanjung Priok in North Jakarta.

“The Cikarang railway should be finished in three months, so containers from the dry port can be delivered here by train,” Hatta said. “We hope with this railway we can increase industry productivity and capacity because of the faster delivery.”

He said the first phase of the railway connected Cikarang with Pasoso Station — two kilometers from Tanjung Priok — and could transport 100 containers a day. The government did not reveal the cost of the first phase.

Hatta said he expected construction on the rail link connecting the first phase with Tanjung Priok to be completed by 2012.

“The second phase of the railway will stretch to the port itself,” he said, adding the next phase would require some Rp 35 billion ($3.9 million) to remove 190 houses currently located in the rail line’s path. The finished line will run 51.4 kilometers.

Located at the heart of the Jababeka, the country’s largest industrial zone, the Cikarang Dry Port serves as an extension of Tanjung Priok, providing one-stop export and import services for more than 2,500 companies, from multinationals to local small and medium enterprises.

Port and customs clearance for containers from Jababeka can be completed at Cikarang before transportation to Tanjung Priok.  “Tanjung Priok will just be a handling port if all the customs procedures have been completed at the dry port,” Hatta said.

The Cikarang railway project is part of broader government efforts to increase economic growth by expanding the country’s inadequate infrastructure.

The government also has plans to expand Tanjung Priok’s capacity over the next five years with four new terminals, a project that is expected to carry a price tag of Rp 22 trillion.

The revamp is planned to more than double the port’s ability to handle cargo.

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Motorcycle Demand to Double by 2015 as Incomes Continue to Climb: Financier

Indonesia’s biggest auto finance firm on Friday said it expected motorcycle demand to double by 2015, while demand for cars would jump sharply if per-capita GDP reached $4,000, up two-thirds from current levels.

Stanley Setia Atmadja, president director of Adira Dinamika Multi Finance, said inadequate infrastructure, including roads, was holding back growth in demand for both motorcycles and cars in Southeast Asia’s biggest economy.

Indonesian motorcycle sales are expected to reach 6.5 million units this year while car sales are forecast at a record 700,000 units.

“With an annual growth rate of 10 to 15 percent for the motorcycle market, in five years we will reach the consumption peak,” Atmadja said, adding that as incomes rise, many more Indonesians will buy cars rather than motorcycles.

“People are now shifting their preference to cars. People who previously owned a motorcycle now turn to used or new cars ... Some also change from low-priced models to mid- or high-priced models because their salaries are going up,” he said in an interview in his office, where he collects small models of classic cars.

“The car market will see a significant jump in demand if our income per capita reaches $4,000,” he said, but that is contingent on the government boosting the pace of infrastructure development.

Indonesia’s per-capita income was Rp 21.48 million ($2,391) in 2009, according to the Central Statistics Agency (BPS).

A former banker at Citibank, Atmadja founded Adira in 1991 with Teddy Rachmat, the former president director of auto distributor Astra International. The two businessmen have sold most of their shares in Adira to Bank Danamon, the country’s sixth-largest lender.

Adira has 15 percent of the multifinance market, and derives about 70 percent of its business from motorcycle financing, with the remainder from car financing. However Atmadja sees that changing to 50-50 in a few years.

Adira’s profit accounts for about half of Danamon’s full-year net profit, forecast by Reuters at Rp 2.9 trillion, up 89 percent from Rp 1.3 trillion in 2009.

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Infrastructure

Govt speeds up building Cikarang-Priok railroad track
ANTARA News, Jakarta – 30/08/2010

The government is speeding up the construction of the railroad track between Tanjung Priok port and Cikarang Dry Port integrated customs area (KPPT) to smoothen the dispatch of goods, and raise productivity and industrial capacity.

"Many parts of the railroad track had to be built and improved to support the project. And this needs to be in progress in a period of three months," Coordinating Minister for Economy Hatta Rajasa said when making an inspection of the KPPT project in Cikarang, Bekasi, West Java, and the Tanjung Priok port in Jakarta Saturday.

Accompanying the Minister were Finance Minister Agus Martowardojo, State Enterprises Minister Mustafa Abubakar, Transportation Minister Freddy Numberi, Public Works Minister Djoko Kirmanto, Industry Minister MS Hidayat, Agriculture Minister Suswono, Customs and Excise Director General Thomas Sugijata, and President Director of PT Pelindo II RJ Lino.

Hatta said in the working visit, the government would be able to make a quick decision to speed up the dispatch of goods, and moving some empty containers to some industrial areas.

He also said that speeding up the construction of the toll road to Tanjung Priok is still facing land procurement problems.

He also said that the improvement of the infrastructure will shorten the time of mooring ships according to the ASEAN standard from 5.5 to only 3 days, especially if the railroad track could be completed in the next three months.

In the meantime, with regard to the expansion of Tanjung Priok port by building four new terminals, Hatta said the land procurement would be finished in June next year under a funding scheme following consultation with the finance minister and the state enterprises minister.

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Modernland & Premier co-work in new project
Irsad Sati. Bisnis.com, Jakarta – 30/08/2010

PT Premier Qualitas Indonesia, a French investment company, and PT Modernland Realty are working together to develop 3.8-hectare new residential cluster in Kota Modern, Tangerang, with investment value as much as IDR100 billion.

Both companies agreed to develop 137 houses in Premier Golf Estate cluster, featuring a type of 127-sqm land area and 144-sqm building area until the biggest type having a 225-sqm land area and 209-sqm building area.

Tommy Wong, President Director PT Premier Qualitas Indonesia, said the housing market in Jabodetabek area is still big, encouraging the company to develop a partnership with Modernland in jointly construct middle-class and high-class residences.

He said in a press release todat that the sources for funding the project come from the internal cash of both companies.

In the project, Modernland will provide the land while Premier Qualitas provides the money for construction and infrastructure of the project.

President Director Modernland Realty Edwyn Lim confirmed that the partnership considers the success gained by the two companies in previous projects.

“We design Kota Modern to be an environmental-friendly residential area.  That is why many green areas surround the clusters. We apply the concept of green property in Kota Modern,” he said.

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Information and Communications Technology

Int’l call service lucrative in Indonesia
I. Christianto. The Jakarta Post, Jakarta – 30/08/2010

In the rapidly changing ICT arena, particularly with the influential role of the Internet, several communications services are offered at lower rates.

For example, overseas calls made through Voice over Internet Protocol (VoIP) can be far more economical, sometimes over 80 percent cheaper than standard International Direct Dialing (IDD) rates.

Following the trend of lower tariff structure, communications service providers or telecommunications operators are competing to offer attractive rates to lead the market. Customers will then be able to make international calls for less.

VoIP technology has created a revolution in the telecommunications sector by introducing the idea of free access numbers for making international calls. VoIP transmits telephone calls over a data network like the Internet instead of the traditional voice network, so its cost is much lower than traditional IDD. Based on the technology, many operators now offer international calling cards that eliminate the fear of financial burden that comes in the form of hefty phone bills.

As Internet access has grown significantly, more operators, including those offering IDD, have set Internet Protocol-based services because they believe that VoIP is one of the most appealing and functional applications that will benefit most customers.

Leading telecommunications operators in Indonesia, PT Telkom and PT Indosat, have also introduced such services. Telkom, which runs 007 and 017 as its IDD codes, and Indosat with its 001 and 008 codes, have set 01017 and 01016, respectively, for their VoIP accesses.

Since April last year, the competition in IDD services in Indonesia has actually become stiffer with the arrival of a third player, PT Bakrie Telecom, with its 009 access code. As a new player in the IDD sector, the company boasts it offers economical IDD rates, saying that its voice quality is clear as it is channeled via uncompressed real clear channel voice connection.

International call service indeed remains lucrative in Indonesia. It is estimated the market for international calls has a potential volume worth Rp 7 trillion. The huge figure is partly due to the more than 4.5 million Indonesian workers employed in foreign countries, more than 50,000 Indonesian students studying abroad as well as increased communication between local businesspeople and their foreign counterparts. All these are obviously the target of international call service.

Since Telkom, Indosat and BTel also run mobile phone services,  they can therefore offer special rates to their cellular subscribers. This is important for them as mobile phone users in Indonesia have been increasing spectacularly in recent years.

In line with the dramatic rise in cellular users in the country, other cellular (CDMA and GSM) providers in the country try to lure their customers with low international call rates. It makes sense as those who make international calls on a regular basis will always want to get low international calling rates and superb connections. As well, they want to be able to make the calls from their gadgets in hand.

Cellular operators have then to offer even more competitive product and services in international call service. One operator tries to extend “attractive” rates. For example, a bill is charged based on seconds, so users only pay for the time they talk. Another operator provides the first two of three minute free for a certain call time, while the other claims to have the best solution far from ridiculously high international call rates.

PT Hutchison CP Telecommunications (HCPT), which operates GSM service in Indonesia with 3 (Three or Tri) brand, is among the providers that strives to offer competitive international call services. The company is affiliated with Hutchison Telecom International Ltd. Tri users can now, for instance, make a call to Malaysia at only Rp 299 per minute. With such a rate, the company claims, users save 82 percent on the standard IDD rate.

Tri users can also enjoy a call back facility when they are on international roaming, in which it includes voice and text services. Tri’s international roaming covers 264 networks in 126 countries. Another service from Tri is the international call service through 01088 code, which cost Rp 110,000 per month. The service covers 21 countries, including Australia, Britain, Canada, China, Germany, Hong Kong, Japan, Singapore, Taiwan, Thailand and the United States. Users can use up to 1,200 minutes per month, with any time over that charged based on regular rates.

Various gimmicks and promotions are out there. Consumers are expected to enjoy the benefits of lower rates and better services. However, they still need to be careful in selecting and comparing the services and product so they really get what they want.

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Information Ministry Takes an Inch, Porn Sites Run a Mile
Arghea Desafti Hapsari. The Jakarta Post, Jakarta – 30/08/2010

If this was a race, the Communications and Information Technology Ministry would be the heavily panting, sweaty out of shape runner who drags his feet while eyeing with envy the clear winner running far in distance: the porn sites.

The ministry’s efforts to block X-rated sites are hitting a brick wall, as acknowledged by one ministry official.

Ministry official Hendri Subiyakto said Sunday that for every porn site blocked, new sites with different names and different URLs were created.

Since the start of the Muslim fasting month of Ramadan, the ministry has made endless attempt to block porn sites. Critics have said this was not feasible, and that any attempts made would be futile.

“We have not succeeded [in blocking the sites],” Hendri was quoted as saying by Antara news agency. He was speaking at a working visit with Manpower and Transmigration Minister Muhaimin Iskandar in Madura, East Java.

Hendri said there were 400 million porn sites and images on the Internet, and that each year, 24 million new pages carrying “obscene” material were created.

“This is the obstacle in our efforts, this is why there are still porn sites and images that escape the ministry’s filters,” he added.

Sammy Pangerapan from the Indonesian Internet Service Providers Association (APJII) told The Jakarta Post that ISPs were going to take a business approach to the “problem”. “We are targeting to have every ISP provide filtered services before the fasting month ends. If customers want to have filtered Internet access, they will have the option of subscribing to filtered services,” he said.

The ISPs, he added, would have to provide detailed information on which sites were blocked by the service. “ISPs provide access. If we ever want to block our customers’ access to certain web pages, we will have to let them know,” he told the Post.

Sammy added that the government needed to foster the growth of local content to help curb visits to pornographic web sites.

Local content makers need to join international conferences to learn how to make online content with international standards, he said.

ISPs, he added, were planning to cooperate with non-profit NGO ICT Watch and other communities in campaigning on Internet safety. Educating users on safe browsing would be the main focus. “The most effective filtering is through education,” he said.

Hendri acknowledged that a blanket block on porn sites would never be fully accomplished. Some sites, he said, “broke through” the ministry’s censors.

He maintained, however, that the government’s effort to block the sites was necessary to curb the spread of pornography on the Internet, saying Internet porn would damage the morality and mental health of the nation.

He added that the government was respecting Muslims who were fasting by taking such steps.