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Indonesia Plans to Complete the Unclear Regulations on Agricultural VAT

Indonesia Plans to Complete the Unclear Regulations on Agricultural VAT
Indonesia Farmer are planting rice in the fields. Photo: Special

JAKARTA (TheInsiderStories) – The government plans to discuss the impact of policies related to the discourse on the elimination of Value Added Tax (VAT) of agricultural products. It’s hoped that these provisions will not burden farmers and industries that utilize agricultural products, so it still have fair and equitable economic competitiveness.

“We are still trying to explore the impact and so on, like what the impact is to farmers, as well as the right time. Because of that we are constantly trying to find the best solution,” said the Head of State Revenue Policy Center of Ministry of Finance Fofal Rofyanto Kurniawan in Jakarta, on Tuesday (02/19).

Kurniawan explained that currently his party was discussing important matters that would be included in the rules, for example related to the types of agricultural commodities that would be regulated in the policy.

“What kind of definitions must be made about agricultural products, what kind of policy will be, then, we still want to close it, deepen it before we publish the regulation,” he said.

The government will also pay attention to the decision of the Supreme Court which has canceled a number of articles in Government Regulation number 31 of 2007 which stipulate agricultural products produced from agricultural, plantation and forestry businesses, as goods which are exempt from imposition of VAT.

However, it has not been confirmed regarding the level of effectiveness of the regulation and when exactly the tax rules will be completed and issued. Until now, there has been no decision whether agricultural VAT will be deleted or not.

He acknowledged that further discussion was still needed with the Coordinating Ministry of Economic Affairs. Then, the government will determine its policies, including any commodities that are exempt from VAT.

Previously, the government had abolished agricultural VAT as stipulated in Government Regulation Number 31 of 2007. However, the regulation was canceled after a decision from the Supreme Court.

In this regulation, the defining of agricultural goods is goods produced from business activities in the fields of agriculture, plantation, and forestry; animal husbandry, hunting or capture, or captivity; or fisheries either from fishing or cultivation. While from the plantation, the VAT released is oil palm.

In late December, the Coordinating Minister for Economic Affairs Darmin Nasution said that the Supreme Court’s ruling was only beneficial for fresh fruit bunch farmers. Because, farmers can made input tax refunds.

While for other farmers who are not processed in the form of seeds or in fresh form, the decision is burdensome. This was what currently concerns the government.

However, Darmin was reluctant to disclose any alternatives that had been announced by the government because they still had to conduct discussions with the Minister of Law and Human Rights.

Previously, the Directorate General of Tax of the Ministry of Finance has processed and reviewed the service sector for which export can be given exemption from VAT or zero percent tariff and ensuring that 10 percent VAT will not apply to farmers who have a turnover below Rp 4.8 billion per year.

But, the Indonesian People’s Sugar Cane Farmers Association objected to the imposition of 10 percent VAT which would be applied to agricultural and plantation commodities, including sugar as the result of the Supreme Court’s decision.

Written by Daniel Deha, Email: daniel@theinsiderstories.com

Indonesia to Completes Korea’s CEPA This Year

Indonesia to Completes Korea's CEPA This Year
Indonesian Minister of Trade Enggartiasto Lukita and Minister of Trade of the Republic of Korea signed IK-CEPA reactivation at the Indonesia-Korea CEO Business Forum event in Jakarta, on Tuesday (02/19). Photo by The Ministry

JAKARTA (TheInsiderStories) – Indonesian government continues to boost the process of ratifying trade agreements with other countries. This year, the government intends to finalize the process the Indonesia-Korea Comprehensive Economic Partnership Agreement (IK-CEPA). With this, the government targets the investment value of trade relations with South Korea to reach US$ 30 billion by 2022.

“This business forum was created to overcome various things that disrupt the trade and investment, so it was discussed in this forum,” said Minister of Trade Enggartiasto Lukita after signing the IK-CEPA in Jakarta, on Tuesday (02/19).

According to him, the increase in trade cooperation can reach all existing trade sectors, both services, goods, and investments, especially in the electronics and automotive sectors in formed cooperation.

Based on Indonesia’ Investment Board data, the realization of South Korea’s investment from January to June 2018 has reached US$ 1.2 billion or around 7.5 percent of total foreign investment in Indonesia, below Singapore, Japan and China.

Meanwhile, Director General of International Trade Negotiations Iman Pambagyo, stated that the negotiations actually began in 2012. But, the negotiations had stopped in 2014. Finally, the signing of the negotiation agreement was held again today.

The negotiations faced a halt because South Korea refused to invest in Indonesia as a reciprocal for the release the number of goods from South Korea. At that time, the Government requested that they open markets for agricultural and fishery products but were not fulfilled.

However, the bilateral relations between the two countries that were familiar for the past 45 years were made in the visit of President Joko Widodo to South Korea in September 2018. There, Indonesia pocketed 15 Memorandum of Understanding (MoU) agreements and 6 investment commitments totaling US$ 6.2 billion.

Explained, there were a number of things that were the focus of the IK-CEPA negotiations, namely if previously the negotiations used the Harmonized System (HS) code in 2012, now it had changed using the HS code 2017.

In addition, the opening of the ASEAN-Korea Free Trade Agreement (AK-FTA) was also discussed in the negotiations. It was stated that Indonesia had previously signed the protocol to amend AK-FTA through a Presidential Regulation.

In the AK-FTA agreement, there is still a closed room between the two parties because there are less than 92 percent of products open. In addition, bilateral negotiations also have fewer challenges than multilateral agreements.

Besides AK-FTA, Indonesia-Korea was also involved in the discussion of the Regional Comprehensive Economic Partnership (RCEP). This will become the basis for the IK-CEPA cooperation contract.

It was mentioned that in the IK-FTA the government would focus more on the application of industry 4.0 in the manufacturing sector and public services. It is expected that IK-FTA can enhance cooperation between the two countries in developing this.

Previously, the government had signed the ASEAN-Hong Kong Free Trade Agreement (AHKFTA). The Parliament has approved the agreement and ratified it through a Presidential Regulation which will be issued in April or March 2019.

According to the provisions of AHKFTA, it only applies (entry into force) if it has been ratified by four countries. This AHKFTA will benefit importers to obtain cheaper ingredients, where Hong Kong will provide flexibility for residence permits for Indonesian workers.

Besides AHKFTA, Indonesia also still has not ratified the Indonesia-Chile Comprehensive Economic Cooperation Agreement (IC-CEPA). It also includes the Indonesia-Pakistan Protocol to Amend (IP-PTA), which will also be ratified through the Presidential Regulation and discussed in depth by the Parliament.

Written by Daniel Deha, Email: daniel@theinsiderstories.com

Moody’s Revises Bumi Resources’ Ratings Outlook to Negative

Moody's Revises Bumi Resources' Ratings Outlook to Negative
The Coal Mines Operation - Photo by Bumi Resources

JAKARTA (TheInsiderStories)Moody’s Investors Service has affirmed the B3 corporate family rating (CFR) for PT Bumi Resources Tbk (Bumi). At the same time, Moody’s has affirmed the B3 rating on the Series A and Caa1 rating on the Series B senior secured notes due 2022 issued by Bumi’s wholly owned subsidiary, Eterna Capital Pte. Ltd., and guaranteed by Bumi. Moody’s, has revised that the outlook on the ratings above to negative from stable.

“The negative ratings outlook reflects our expectation that Bumi’s principal debt repayments will continue to trend lower than our previous expectations,” says Maisam Hasnain, a Moody’s Analyst, on Tuesday (02/19).

Moody’s had initially expected Bumi to repay US$ 300-$500 million of principal under its Series A notes and Tranche A facilities (collectively referred to as ‘Tranche A’) by the end of 2019, following the completion of Bumi’s debt restructuring in December 2017.

“However, we now expect Bumi to repay only around $220 million of principal by the end of 2019, primarily due to lower-than-expected coal sales volume, working capital challenges, and a price cap on domestic coal sales to electric utilities,” adds Hasnain, who is also Moody’s Lead Analyst for Bumi.

Negative ratings pressure will persist until such time as Bumi can materially improve its cash generation. The company is taking steps to improve this, including reducing outstanding receivables from domestic customers. Bumi also expects its 90 percent owned subsidiary, Arutmin Indonesia to start paying it dividends from July 2019.

Bumi’s aggregate debt balance will continue to rise, as the pace of principal repayments on its Tranche A debt slows, eventually leading to an unsustainable capital structure should this continue.

While Bumi’s annual cash interest payments total only $30-$35 million a year, a majority of its debt has payment-in-kind interest, which is accrued and added to the principal amount of debt should Bumi have insufficient cash to make periodic interest payments on these instruments.

The negative ratings outlook also captures the heightened liquidity risk for Bumi, given large tax prepayments at it 51 percent owned subsidiary, Kaltim Prima Coal (KPC).

Additionally, on 31 January 2019, Bumi announced that KPC would prepay its income tax of around $212 million by April the same year, of which, $42 million was prepaid in January 2019. This large cash payment for tax will significantly reduce KPC’s free cash available to make dividends to shareholders in the coming months.

Bumi is currently solely reliant on dividends from KPC to meet its cash obligations. As a result, Moody’s expects Bumi’s debt repayments to be minimal, while KPC makes its large tax prepayments.

Bumi has confirmed that it has sufficient cash in its debt service reserve account to meet its cash interest payments for the quarter ended March 2019. The company has also confirmed KPC has the flexibility of amending the tax prepayment schedule, such that KPC will ensure it provides sufficient cash dividends to Bumi for the parent company to remain
current on its cash interest payments.

However, Moody’s is cognizant that Bumi’s liquidity risk will remain elevated during this period of large tax prepayments, should KPC prove unable to extend its tax prepayment terms or faces unforeseen cost overruns, which constrain its ability to make dividend payments to Bumi.

Upward pressure on Bumi’s ratings is unlikely, given the negative outlook.

Nevertheless, the outlook could revert to stable if Bumi increases its pace of debt reduction such that it has repaid around $300-$400 million of Tranche A principal by the end of 2019, while maintaining prudent financial policies, with a strong adherence to its cash account
management agreement.

On the other hand, Moody’s could downgrade the ratings if: (1) Bumi’s ability to generate cash to repay debt remains slower than Moody’s initial expectations; (2) KPC has difficulty prepaying or deferring its large tax prepayments in the coming months; (3) Bumi fails to extend its mining licenses at KPC and Arutmin on substantially similar terms; or (4) a deviation occurs from the stated prudent financial policies, including adherence to the terms of its cash account management agreement.

As we know, Bumi Resources Tbk, through its majority-owned subsidiaries, is Indonesia’s largest thermal coal producer. The company produced around 63 million tons of coal for the nine months to 30 September 2018. Its principal assets include a 51 percent stake in Kaltim Prima Coal and a 90 percent stake in Arutmin Indonesia.

Written by Daniel Deha, Email: daniel@theinsiderstories.com

Indonesia’ Maybank will Issue Bonds of US$ 71.42 M

Indonesia' Maybank will Issue Bonds of US$ 71.42 M
PT Maybank Indonesia Tbk
JAKARTA (TheInsiderStories)PT Bank Maybank Indonesia Tbk (IDX:BNII) plans to issue bonds  around Rp1 trillion or US$ 71,42 million in second half of this year, regarding of conditions after celebrating of presidential election.
Previously, BNII has issued bonds with same amount in October last year.
Maybank Indonesia’s President Director Taswin Zakaria explained, the issuance of these bonds was very dependent on credit growth.”We will see the loan growth, so the liquidity needs will adjust,” he said in Jakarta, on Tuesday (02/19).
On the other hand, Thilagavathy Nadason, Finance Director of Maybank Indonesia also mentioned about the loan growth because company only booked loan 6 percent of last year.
“Consumer loan is the matter, if it does not increase, so there will be no plan of bond issue. Therefore  we targetted loan growth around 8 until 9 percent before launching bond in the second half,” said Thilla.
Meanwhile, political situation also becomes the matter for BNII. In the first half of 2019, BNII is seeing the political situation, so Maybank Indonesia delays the plan untul September-October of 2019.
BNII recorded profit Rp 2.2 trillion in 2018, increase by 21.6 percent from 2017 of Rp 1.8 trillion. It is generated by interest income which grew 5.2 percent to Rp 8.1 trillion.
On the other side, Maybank also recorded loan growth 6.3 percent of Rp 133.3 trillion and asset Rp 177 trillion.
Unlike interest income, BNII’s non interest income jumped by 17 percent to Rp 2.26 trillion.
“This decrease is derived from treasury business and global economy factors,” Thilla said.
Written by Staff Editor, Email: theinsiderstories@gmail.com

The US Wants to Set Up a Liaison Office in North Korea

Insight: Questioning Trump's Denuclearization Commitment
Donald Trump and Kim Jong Un Signed the Peace Agreement in Korean Peninsula - Photo by AP

JAKARTA (TheInsiderStories) – United States (US) is considering setting up a diplomatic office in North Korea, a symbolic move that could show how relations between Washington and Pyongyang have seriously begun to thaw while the two sides negotiate to curtail Pyongyang’s nuclear and missile forces, according to a Trump administration official, on Monday (02/18).

The Trump administration wants a senior diplomat in North Korea to set up a liaison office, which would serve as America’s quasi-embassy but with very stripped-down functions. The hope is that Pyongyang, in return, would send its own envoys to the US. If that happens, it would be the first major step toward reestablishing diplomatic relations between the two nations.

The proposal comes as President Trump prepares to meet later this month in Hanoi, Vietnam, with North Korean leader Kim Jong Un. The plan would allow North Korea to also open an office in the US, the official said, but it wasn’t immediately clear how strongly North Korea supported the idea.

Trump has repeatedly boasted of the warm relationship he has established with Kim. But there has been little progress since the two leaders met in Singapore in June and pledged to improve ties and work toward denuclearizing the Korean Peninsula.

While North Korea has suspended nuclear tests and missiles launches since 2017, the two sides still appear to be far apart on the pace of denuclearization and what concessions the Trump administration might give in return.

The priority for North Korea is persuading the US to ease economic sanctions, which have damaged the North Korean economy.

Some former officials said that the opening of liaison offices might be a way to improve ties without reducing the economic pressure the Trump administration wants to maintain on North Korea until it gives up its nuclear and missile arsenals.

“Partly, it is a symbolic gesture to demonstrate our relations have improved. As a practical matter, it is a good idea because if we sent in inspectors they would need a base of operations,” said Gary Samore, senior National Security Agency official on weapons of mass destruction, as report by CNN on Monday.

Stephen Biegun, the US special envoy for North Korea, said in a speech last month that the formal lifting of sanctions wouldn’t come until North Korea rids itself of nuclear weapons. At the same time, Biegun indicated the US could take steps as North Korea begins to dismantle its nuclear and missile arsenals, though he didn’t spell out what they might be.

The Trump administration official said that the liaison office idea, which appears to be just one element of a package of negotiating proposals, might be discussed further when Mr. Biegun meets in Hanoi with his North Korean counterpart prior to the summit.

The idea of a liaison office isn’t a new one. When the Clinton administration worked out an accord in 1994 that required North Korea to freeze, and ultimately dismantle, its plutonium production capability, the two sides also discussed setting up liaison offices.

The plan for the offices, however, fell apart when North Korea’s security services said they wouldn’t allow the US to use a diplomatic pouch to bring in materials and documents without inspection.

The State Department and North Korea didn’t immediately respond to a request for comment. CNN has reported that both sides are discussing the idea of setting up the office.

Robert Einhorn, a former senior State Department official who negotiated with North Korea over its missile programs, said a liaison offices “would be valuable for both sides, but I am not sure whether the North Koreans are more receptive to the idea than they were in the past.”

“The kind of reciprocal steps that the North wants most – economic sanctions relief – is the kind the administration is least willing to give,” Einhorn said.

In a Jan. 1 speech, Kim pointed to the sort of concessions he is looking for. He mentioned he would unconditionally welcome the reopening of an inter-Korean factory complex that had employed North Korean laborers until its closure in 2016 following repeated North Korean provocations.

Kim also said he would embrace the reopening of a tourist resort located just north of the inter-Korean border which used to attract South Korean tourists until 2008, when a North Korean soldier shot a South Korean woman, which led to its de facto closure.

The reopening of both sites would require exemptions from international sanctions that bar the inflow of hard cash into North Korea, as the factory complex and tourist attraction had both earned the Pyongyang regime cash.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com

Indonesia’s Trans Corp Wins Loan from IFC US$275M

Trans Corpora (Trans Corp), unit of conglomeration company CT Corpora (CT Corp) get loans US$275 million from International Finance Corporation (IFC) - Photo by CT Corp

JAKARTA (TheInsiderStories) – Trans Corpora (Trans Corp), unit of conglomeration company CT Corpora (CT Corp) get loans US$275 million from International Finance Corporation (IFC), to support the business development of in retail, tourism and property sectors throughout Indonesia.

In a written statement on Monday (02/18), IFC said, that the investment would be used to support the development of Trans Corp retail outlets in 25 cities until 2025. The investment also would encourage the development of modern retail networks in the country in order to expand consumer access to products quality.

Expansion of Trans Corp in the retail sector is expected to create more than 30,000 new jobs in Indonesia. Through this sector, the retailer collaborates with more than 6,000 suppliers, of which almost 70 percent are small and medium businesses. In addition, an estimated 23,000 jobs will be created in the agricultural and distribution sectors.

“IFC’s support will help us develop our business and deliver innovative products and services to consumers while investing in their future by implementing more sustainable business practices,” said Chairul Tanjung, Chairman of CT Corp after the signing ceremony.

In line with the Indonesian government’ strategic priorities to develop the tourism sector supported by a World Bank worth $300 million, the IFC loan facility will also be used to help Trans Corp expand its business in the tourism sector.

Through collaboration with Accor, an international hotel management company, Trans Corp plans to build 30 new hotels with nearly 6,000 rooms throughout the archiepelago.

In addition, the company is building more than 10,000 apartment units at affordable prices in various locations to meet the residential needs of the middle class as part of efforts to reduce the housing deficit that Indonesia is facing.

Trans Corp is also committed to implementing an environmentally friendly building concept worth at least $275 million that meets the standards of Excellence in Design for Greater Efficiencies (EDGE) of IFC.

Well-known, buildings in Indonesia are the third largest energy users which are estimated to consume around 27 percent of the total national energy consumption. If it is not managed properly, the energy consumption of these buildings and buildings has the potential to increase to 39 percent of total energy by 2030.

“This financing package aims to maximize private sector development to support one of IFCs main objectives of creating employment,” said Nena Stoiljkovic, IFC Regional Vice President for Asia & the Pacific at the same occasion.

She added, that by encouraging innovation and investment from the private sector, Indonesia could spur economic growth through a variety of sustainable projects.

The establishment of a partnership between IFC and CT Corp was established marked by the signing of an agreement by Philippe Le Houerou, CEO of IFC and Chairul Tanjung in October 2018. Its known, in 2018, IFC has channeled more than $23 billion in long-term financing to developing countries, utilizing the power of the private sector.

Previously, in December 2018, IFC projected a $30 billion investment potential in Jakarta in the green investment sector for the period 2018-2030.

While, Sandra Pranoto, IFC Indonesia Green Building Leads, stated that the projection was part of the latest IFC report that analyzed targets for improving the city’s climate and planned activities in six potential urban areas: Jakarta-Indonesia, Nairobi-Kenya, Mexico City-Mexico, Amman -Jordania, Rajkot-India, and Belgrade-Serbia. T

he total potential of green investment in the six sample cities is projected to reach $97.5 billion. For the global scale in cities in developing countries, IFC projects the total potential of green investment to reach $29.4 trillion for the 2018-2030 period.

Reportedly, the potential for green investment in Indonesia covers siz fields. The biggest potential is in the field of green buildings worth $16 billion, $7 billion in electric vehicles, $3 billion in new renewable energy, $3 billion in clean water, $725 million in waste, and $660 million in public transportation. A total of $30 billion.

Globally, the scale of potential investment in the green building sector is also the highest, reaching $24.7 trillion, or 84 percent of the total potential investment of $29.4 trillion by 2030.

Pranoto explained, the investment was needed to pursue the emission reduction target of 30 percent from the level of 2005 and create a new renewable energy source which contributed 30 percent of the total energy needs by 2030.

Meanwhile, Jakarta Government reportedly has revised the Governor Regulation 38 of 2012 concerning Green Building. Since than, Jakarta has 339 green buildings covering 21 million square-meters, reduction of potential CO2 emissions of 874 million metric tons, savings of potential electricity use of 1.16 million MWh, and potential savings of electricity costs of $89.6 trillion.

Jack Sidik, IFC Indonesia’ Senior Country Officer, reports that around 60 percent of Indonesia’s population will be concentrated in cities in 2025. This will be a major threat to climate change, but at the same time has great business potential and investment in it.

He appreciated the steps of the Financial Services Authority, which since last year had issued regulations related to green bond  emissions, which the government has realized through global green sukuk emissions this year.

According to him, with the opening of green funding opportunities and encouragement from government regulations, the potential for green investment worth $30 billion in the next 2030 in Jakarta is very likely to be realized.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com

Indonesia’s Pertamina Hulu Energi Manages Maratua Block

PT Pertamina Hulu Energi (PHE) to manage the Maratua Working Areas located in Berau District, East Kalimantan Province, after signed the Cooperation Contract of Production Sharing  with the Special Work Unit and Oil and Natural Gas signed in Jakarta, on Monday (02/18).

JAKARTA (TheInsiderStories) – Indonesian energy producer, PT Pertamina Hulu Energi (PHE) to manage the Maratua Working Areas located in Berau District, East Kalimantan Province, after signed the Cooperation Contract of Production Sharing  with the Special Work Unit and Oil and Natural Gas signed in Jakarta, on Monday (02/18).

According to Managing Director of PHE Mediawati, the scheme for managing the Blok Maratua is the same as other work areas, with the gross split scheme, with a total investment of US$7.75 million, which includes Definite Work Commitments and Signature Bonuses.

“The Blok Maratua will be operated by PT PHE Lepas Pantai Bunyu and has been prepared in the long term to sustain the continuity of domestic gas supply,” she said in the written statement.

As known that the unit of stated-owned oil and gas holding PT Pertamina, also has an active working area in the North Kalimantan area, namely Pertamina EP Asset 5 in Bunyu, PHE Nunukan Company, JOB Pertamina-Medco EP Simenggaris and PHE East Ambalat.

Yesterday, Indonesia Energy and Mineral Resources (EMR) ministry signed an agreement over the third stage of oil and gas blocks auction. The agreement valued $16.95 million which consists of $10.95 million projects commitment value and $6 million bonus signature.

From the bid held in Nov. 5 to Dec. 21, 2018, three of four blocks met the expected price. Those are South Andaman block, South Sakakemang block, and Maratua block. Two blocks won by direct offers and one won by special direct offer to state-owned energy producer Pertamina.

The $2.15 million value South Andaman working area was won by Pearloil (Theralite) Ltd from middle eastern. Pearloil gets three years commitment for G&G and 500 kilometres square seismic 3D.

South Sakakemang block won by Dutch Talisman Java B.V. and Japanese Mitsui Oil Exploration Co. Ltd. The commitment value for the block is $3.05 million. It is for 3 years commitment of G&G and 250 kilometres square seismic 2D.

Collaboration with Pelindo Incorporated

At the same time, Pertamina and PT Pelabuhan Indonesia (Pelindo) I-IV agreed to establish business cooperation to optimize and utilize the assets of Pelindo port in energy distribution effectively and efficiently.

Overall, the various Pertamina-Pelindo business partnerships cover at least 18 fields, among others, the operation of TBBM and Gas in Belawan and Kuala Tanjung, the operation of Dumai Terminal, the development of Pekanbaru Water Front City, the optimization of Tanjung Intan Port, and the development of the gospier dock.

In addition, Pertamina and Pelindos also agreed to build the Teluk Lamong LNG Terminal, Filing Station in Banjarmasin and the development of the Liquid Bulk Asphalt Terminal in Benoa, Bali.

In the eastern part of Indonesia, Pertamina-Pelindo cooperation intends to supply electricity and gas in Makassar New Port, LNG installations in the Palu, Makassar, Bitung and Morotai Industrial areas, providing land for Asphalt Terminals in Samarinda, Makassar and Bitung and providing land for LPG terminal  in Balikpapan, Maumere, Ternate, Sorong, Manokwari, and Merauke in Papua. While in Gorontalo, Pertamina will build an FSRU facility.

Pertamina‘ CEO Nicke Widyawati assessed that this synergy will be carried out in three business lines, namely the use of fuel in all ports, the use of Pertamina lubricants and the development of Retail LNG in Benoa Port, Bali.

“The use of fuel in the port area managed by Pelindo per year is approximately 360 thousand kiloliter. While, the use of lubricants is approximately 460 kl per year. Pertamina will also follow up on increasing cooperation in the use of the pier, service and delay,” said her.

Pelindo I’ CEO Bambang Eka Cahyana, expect the collaboration able to boost the performance in Kuala Tanjung Port to become the international hub, Dumai Port which becomes the largest CPO export port in Indonesia and with unit of Pertamina’ will develop Water Front City in Pekanbaru to encourage the tourism sector.

Meanwhile, CEO of Pelindo II Elvyn G Masassya noted the implemented in the business activities of both parties will provide added value for the products and services and provide optimal results. This was also acknowledged by the Pelindo III’ CEO Doso Agung, who stated that the synergy between SOEs could open opportunities in terms of providing fuel, bunkers and lubricants for Pelindo, including tugboat, guide, backfill services, maintenance and construction of the pier.

On the other side, CEO of PT Pelindo IV Farid Padang, added that the synergy could optimize Pertamina’ revenues. As for his company, it can optimize the company’s assets for fuel bunkers and gas storage, in addition to optimizing the assets of Pertamina’s tugboats and Pelindo for marine services that have been built so far.

But, he acknowledged that in terms of regulations, there was clarity in the rules and fulfillment of conditions based on package delay regulation and scouting up to now.

Written by Daniel Deha, Email: daniel@theinsiderstories.com

Morning Briefing: Global Oil Prices Near Three Months High

Global Oil Prices the Three Months High on Monday (02/18)

JAKARTA (TheInsiderStories) – Good morning! Global oil prices near three months high as market tightened amid rekindled hopes that the United States (US) and China could reach a trade deal. The increasing also driven by Organization of the Petroleum Exporting Countries (OPEC) production cuts and US sanctions on Iran and Venezuela.

On Monday, West Texas Index Crude was trading up 0.80 percent at US$56.43. While, Brent Crude trade down 0.02 percent to $66.24.

OPEC and Non-OPEC including the largest producer Saudi Arabia helped push prices up. This bullish signal combined with renewed optimism coming from both of the two giant economy in the world had made some progress in last week’ trade talks. The officials from US and China will be meeting again in Washington this week for another round of trade talks and the markets.

Furthermore, US President Donald Trump keeping his promised to secure the Southern Border. As the President Day he said, sections of the border wall are already being built and the funding bill contains robust resources and additional provisions to secure the border and strengthen immigration enforcement.

He noted, the bill provides $1.375 billion for approximately 55 miles of border barrier in highly dangerous and drug smuggling areas in the Rio Grande Valley, where it is desperately needed. Trump reported, more than 40 percent of all border apprehensions occurred in the Rio Grande Valley sector in 2018.

The Rio Grande Valley was the border sector with the most known deaths of illegal border crossers in 2018. $415 million will go toward addressing the humanitarian crisis at the border by providing medical care, transportation, processing centers, and consumables, he added.

President Trump was using his legal authority to take executive action to secure additional resources, just as he promised.  In part, he is declaring a national emergency that makes available additional troops and funding for military construction.

The United Kingdom remains on course to leave the European Union (EU) on March 29. In her letter to member of parliament, prime minister Theresa May said she will return to Brussels to meet European Commission President Jean-Claude Juncker this week and speak to the leaders EU member state over the coming days.

Her main goal is to win concessions over the backstop. Recently EU leaders have rejected May proposal.

From domestic side, Financial Service Agency’ head Hoesen stated, the regional government met some difficulties such as the establishment of special division to manage the debt and maintain relation with investors and Regional House agreement process.

Previously, South Kalimantan Deputy Governor has discussed the municipal bond issuance with Indonesia Stock Exchange officials and considered to gain funding through capital market. South Kalimantan may need around Rp20 trillion ($1.43 billion) alternative funding other than regional budget for infrastructure development.

While, Indonesia Stock Exchange suspended 12 companies shares trade due to their annual listing fee arrears, said official statement. Some of the listed-companies are PT Sugih Energy Tbk (IDX: SUGI), PT Tiga Pilar Sejahtera Tbk (IDX: AISA), PT Golden Plantation Tbk (IDX: GOLL), PT Indonesia Transport & Infrastructure Tbk (IDX: IATA), and PT Sekawan Intipratama Tbk (IDX: SIAP).

Annual listing fee varies from Rp50 million to Rp250 million. Based on regulation, annual listing fee must be paid in advance for 12 months, at least by the end of January. If the payment passed the due, then company must pay the fine at least 15 days after the sanction. Afterwards, the company shares will be suspended if not paying the fine.

Yesterday, the Jakarta Composite Index closed rocketing by 1.7 percent to 6,497, supported by domestic investors. Foreign investors recorded Rp147.02 billion net sells. Meanwhile, Rupiah slightly increased by 0.07 percent to 14,105 compared to US Dollar.

May you have a profitable day!

US$1: Rp14,000

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

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Moody's Revises Bumi Resources' Ratings Outlook to Negative

Moody’s Revises Bumi Resources’ Ratings Outlook to Negative

JAKARTA (TheInsiderStories) - Moody's Investors Service has affirmed the B3 corporate family rating (CFR) for PT Bumi Resources Tbk (Bumi). At the same time, Moody's has...
Indonesia' Maybank will Issue Bonds of US$ 71.42 M

Indonesia’ Maybank will Issue Bonds of US$ 71.42 M

JAKARTA (TheInsiderStories) - PT Bank Maybank Indonesia Tbk (IDX:BNII) plans to issue bonds  around Rp1 trillion or US$ 71,42 million in second half of...
Insight: Questioning Trump's Denuclearization Commitment

The US Wants to Set Up a Liaison Office in North Korea

JAKARTA (TheInsiderStories) – United States (US) is considering setting up a diplomatic office in North Korea, a symbolic move that could show how relations...