JAKARTA (TheInsiderStories) – Good morning. Troubles continue in the opposition camp. Deddy Mizwar, a former actor and one of the key figure in the opposition camp, switched side to join the ruling coalition as one of the spokesman.
There will be repercussion for Mizwar. For one, he will lose the support from his own party, the Democratic Party, an unsatisfied member of the opposition camp.
This, however, is a coup for the ruling coalition. Mizwar is a popular and respected figure in West Java, where he bid for the governor seat but eventually lost to Ridwan Kamil, a rising star from regional electoral process who already declared supports for President Joko Widodo’s re-election bid.
Also, West Java is among the few provinces where the opposition challenger Prabowo Subianto collected more votes than Widodo in the 2014 Presidential Election. According to last poll numbers, Widodo sees rising support in West Java but remains behind Subianto.
The switch by Mizwar is probably the works of Vice President Candidate Ma’ruf Amin, a popular and influential cleric. While there are worries that picking Amin may lower Widodo’s supports from non-Muslim voters, the cleric will certainly serve as a magnet to court Muslim voters.
Meanwhile, equity market in Asia Pacific stayed in the green today as the expected trade deal between the United States and Mexico eases investors’ worries. The Jakarta Composite Index ended up 0.3 per cent at 6,042, while the rupiah weakened slightly at 14,614 per US$1 versus 14,610 per US$1.
There are good news for Indonesia too. The government auctioned four benchmark bonds and two treasure bills on Tuesday (28/08) received a strong bid of Rp59.3 trillion, from which the government raised Rp20 trillion.
The strong demand shows that despite ongoing volatility in the financial market, Indonesian debt papers remain a favorite for investors.
Another positive development comes from the government’s plans to stop importing 900 items, mostly consumer and capital goods, to stabilize the rupiah. The government backtracked on the plan and instead opted to impose tariff restrictions for fears that stopping imports altogether may hurt the economic momentum.
Another key development took place yesterday was the announcement by the Transportation Ministry to raise the minimum airfare to 35 per cent of the ceiling price from previously 30 per cent. The move is not popular among low-cost airlines which relies on cheap tickets to attract passengers but will certainly help flag carrier PT Garuda Indonesia Tbk (IDX:GIAA) which sees its market share eroded by the popularity of budget airlines like PT Indonesia Air Asia (IDX:CMPP) and PT Lion Air.
From overseas, there are renewed concerns that the process for United Kingdom to leave the Eurozone may end without any economic or trade deals with the remaining members of the European Union. The sterling weakened after UK Prime Minister said that no-deal Brexit “would not be the end of the world”.
A no-deal Brexit will leave the United Kindom isolated and with restricted access to the Eurozone and may trigger migration of London-based corporations to other cities within the European Union.
May you have a profitable day.
TIS Intelligence Team, Email: email@example.com