JAKARTA (TheInsiderStories) – Indonesian government proposed “grand fathering” or an exception to Government Regulation Number 14 Year 2018 for foreign investors to have insurance companies with shares above 80 percent. Now, the government regulated foreign ownership in insurance companies a limit of 80 percent ownership of paid-in capital.

In the hearing with parliament, Finance Minister Sri Mulyani Indrawati said, the government would make a slight revision in the regulation and provide flexibility to foreign parties who already owned more than 80 percent shares in Indonesian insurance companies. In terms a minimum of 20 percent, the additional capital must be sought by local partners.

For Indonesia, the increase in the presence of insurance is also considered to be able to create long-term sources of funds in the government and insurance industry.

Furthermore, ministry of industry also encouraged the deepening of the structure of the pharmaceutical industry by offering incentives in the form of tax allowances, tax holidays, and super deductible taxes given to industries involved in vocational programs and innovation through research and development.

According to the director general at the ministry Achmad Sigit Dwiwahjono, the pharmaceutical industry is one of the sectors that contributes significantly to the national economy. This is visible from the achievement of the pharmaceutical industry in the first quarter of 2019 which grew to 8.12 percent or exceeded economic growth at 5.07 percent and contributed to the GDP of 3.24 percent.

So, he said, it can encourage the pharmaceutical industry to develop export markets, especially non-traditional export markets such as Latin America, Eastern Europe, Russia to Africa.

Yesterday, President Director BULOG Budi Waseso plans to export 1 million tons of rice to Papua New Guinea and Timor Leste. He said, the funds from the export can be used to absorb more rice from the farmers. Of this amount, the government will replace it with 2.2 million tons, so that it has the opportunity to absorb even more.

From the security sector, Indonesian Police have arrested the leader of an extremist network-linked to Al Qaeda’ Jemaah Islamiah (JI), Para Wijayanto, who carried out the 2002 Bali bombing that killed more than 200 people, and a 2004 attack on the Australian embassy in Jakarta, which killed nine peoples.

The group which was banned by the Indonesian court in 2008 was also blamed for the 2003 car bombing at the JW Marriott hotel in Jakarta. Wijayanto was detained by anti-terrorism police with his wife on Saturday (06/29) at a hotel in Bekasi, West Java.

In addition to the mastermind behind the bombing, Wijayanto was also suspected of sending at least six Indonesian forces abroad to fight in Syria, and providing support to militants in Poso terrorism hotspots on the island of Sulawesi.

From the global, the Organization of Petroleum Exporting Countries and its allies led by Russia, or OPEC+, agreed to extend the reduction in oil production until March 2020. The agreement to extend the pact follows a decision by the OPEC producer the previous day.

The extension of the production pact will certainly anger United States (US) President Donald Trump, who has demanded the OPEC leader Saudi Arabia to supply more oil and help reduce fuel prices if Riyadh wants US military support in its dispute with its arch-enemy Iran.

Despite oil supply problems, Iran on Tuesday rejected US accusations that Tehran has long violated the provisions of its nuclear agreement with world powers, after the Islamic Republic said it had collected enriched uranium lower than what was allowed under the agreement.

Iran‘ statement could have far-reaching consequences for diplomacy when European countries try to pull the United States and Iran back from confrontation.

Then, European Union (EU) leaders are considering making International Monetary Fund Managing Director Christine Lagarde the president of the next European Central Bank. Lagarde name is an important part of the latest candidate list for the EU’ top jobs which have been contested by leaders, parliamentarians and parties since Sunday.

If elected, Lagarde will become the first ECB president not a professional economist and the second French citizen to lead an Frankfurt-based institution. If she exchanges Washington for Frankfurt, Lagarde will inherit the economy which is likely to have just received a new dose of monetary stimulus. She recently described the world economy as a “rough” blow and advised the central bank to continue adjusting their policies in response.

From the Arabian peninsula, King Salman will visit Indonesia again, after a meeting of Prince Muhammad bin Salman with President Joko Widodo at the G20 Summit in Osaka, Japan, last week.

Maritime Coordinating Minister Luhut Binsar Pandjaitan said, King Salman’ second visit was related to the entry of a giant oil and gas company from Saudi Arabia, Aramco, which would invest in the Balangan refinery worth US$7 billion, and also about the country’ investment plans in Indonesia.

On Tuesday, Rupiah against US dollar closed down in spot market trading today because of the concern for the risks of the US – EU trade war. The local currency weakened 0.21 percent to 14,140, compared to the previous day at 14,100.

Meanwhile, Jakarta Composite Index’ fluctuating pace on Tuesday was influenced by optimism for the US – China trade negotiation and the decline in Indonesia’ economic growth projections by the World Bank. The composite index closed up 5.21 points or 0.08 percent to 6,384.89.

May you have a profitable day!

Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia