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The President PostT H E S P I R I T O F I N D O N E S I A

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The Economic Integration of ASEANThe ASEAN Economic Community was formed as one of the three pillars of ASEAN Community, the other two being ASEAN Security Community and ASEAN Socio-Cultural Community.

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VIEWPOINT THE REGION

“Live the Deal” Set to Respond to Climate Change“Live the Deal” campaign was launched early this month during the Copenhagen Climate Summit.

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TOURISM

Sri Mulyani: Banks Key to Faster Pace in RI EconomyIf banks manage to maintain their soundness and channel credits up to more than 15 percent of the target for 2010, the economy would perform better next year.

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BUSINESS

IDR 10,000

JAKARTA (PP) – Vice Presi-dent Boediono said that “History has proven that it is rare for a na-tion to be able to develop by rely-ing only on natural resources, but with science we will prevail.” he said.

“I wish to make Aceh a center of excellence,” he added.

The VP made the statement at the commemoration of the 5th anniversary of the tsunami disas-ter in Banda Aceh on Saturday.

He said the region once held the status of being a center of ex-cellence long before the conflict and tsunami disaster, news me-dia reported.

Boediono said he was sure that “the right spirit and determina-tion and strong commitment” will allow the plan to be realized.

In comments to Boediono’s reference to science as a driv-ing force behind a nation’s de-velopment, S.D. Darmono, the founder and CEO of PT Jababe-ka Tbk, a prime industrial estate (the largest in Southeast Asia) in Cikarang, West Java, said: “If we can blend well our rich natural resources with science and tech-nology, Indonesia would be in a much better position today in terms of economic and human resources development.”

Darmono, who is also the co-founder of President University, added: “I hope Pak Boediono’s message is also heard by other re-gions and applied throughout the nation.”

VP Boediono: Aceh’s rich natural resources,

better infrastructure will help the region regain its past achievements.

Boediono, an Austra-lian-trained economist, noted that before the conflict broke out, Aceh s economy grew above aver-age while its poverty rate was far below average, both compared to other provinces.

He said Aceh s rich natural re-sources and better infrastructure after the tsunami disaster provid-ed an opportunity for the region to regain its past achievements.

“We must safeguard the devel-opment projects in Aceh so that the people in Aceh will be more prosperous and welfare,” he said.

Boediono visited Banda Aceh to preside over an official cere-mony to mark the deadly tsuna-mi which devastated Aceh and Nias Island (North Sumatra) on December 26, 2009, killing around 200,000 people on De-cember 26, 2004.

The gigantic tsunami, which washed away entire communi-ties, caused nearly $10 billion in damage and more casualties than any other tsunami in history, ac-cording to the United Nations.

The tsunami, which was trig-gered by a 8.9 Richter scale earth-quake, left at least one million people homeless.

President Susilo Bam-bang Yudhoyono declared the

tsunami a national disaster. A number of countries and interna-tional organizations have helped Indonesia reconstruct Aceh and Nias.

Massive reconstruction has helped Aceh bounce back and wipe away some reminders of the tragedy.

Residents held religious gather-ings and a moment of silence to pay tribute to the victims. Many left flowers at the site and read prayers from small books. A few wept as they sat in the shade to es-cape the heat.

A memorial event at a local tsu-nami museum featured dozens of schoolchildren clutching umbrel-las with portraits of smiling chil-dren on them.

Local conservationist Mike Griffiths told CNN that much of Banda Aceh was reduced to a “level plane of shards.” He com-pared the tsunami aftermath to that of the atomic bombing of Nagasaki in World War II.

“It (Banda Aceh) is so built up now,” Griffiths said.

“Now, we can barely see 100 meters because there’s been so much reconstruction. Every-thing’s been built up on both sides of the road.”

On the same day Boediono

paid homage to tens of thousands who lost their lives and were bur-ied in the Siron Lambaro mass grave.

After visiting the mass grave, the vice president and his entourage proceeded to visit the Ulee Lheue harbor complex.

Upon his arrival Boediono was met at the airport by Aceh Gov-ernor Irwandi Yusuf and former chief of the Aceh-Nias Rehabili-tation and Reconstruction Agen-cy (BRR) Kuntoro Mangunsub-roto, who is currently head of the presidential working unit in charge of development supervi-sion and control(UKP4).

Also present on the occasion were State Enterprises Minister Mustafa Abubakar, Vice Chair-man of MPR (People s Consul-tative Assembly) Farhan Hamid and legislator Sayed Fuad Zakar-ia, Antara reported.

Only 15% of national, regional budgets for investment

In Banda Aceh Boediono also met with Aceh regional govern-ment officials during which he stated that “While we need 7% growth a year, the government could maximally provide 15 to 18% of regional and national budgets for investment.”

I ndonesia s tourism sec-tor could record a 1.31% growth in the midst of eco-nomic recovery efforts fol-

lowing the global crisis this year, a tourism ministry official said.

“Up to October 2009, the world was suffering from a glob-al crisis affecting all sectors in-cluding tourism,” an expert staff for economic affairs, science and technology of the ministry of tourism, Titin Sukarya, said here recently, news media reported.

She said from April to Octo-ber 2009 some tourist destina-tion countries in Asia suffered a decline of up to 8.4% because of the crisis.

However, Indonesia s tour-ism recorded a positive growth, “proving that Indonesian tour-ism is still attractive,” she said at the 9th Way Kambas Festival in Sukadana, East Lampung, Su-matra.

She said Indonesia is ranked

Tourism Figures Rosy,Says Official

81st among the world s tourist destination countries based on natural beauty, specific culture, orderliness and security.

Lampung district head Hi Sa-tono said,”We will promote lo-cal culture to attract more foreign tourists.”

Several tourist destinations in the region include the Way Kambas National Park, the Pu-gung Raharjo archeological site, the Way Jepara Kemuning Lake, the Beringin Indah Garden, the Wana Traditional House, the Pekalongan agro-tourism site and others.

MORE DUTCH TOURISTS TO BALIMeanwhile, iIn the first ten

months of 2009 the number of Dutch tourists in Bali rose 22.01% to 63,622 over the same period last year.

The figures put the Dutch tenth as the resort island s source of foreign tourists, overtaking the

Americans, Head of the Bali Pro-vincial Statistics Office Ida Ko-mang Wisnu said here on Mon-day.

It was only in the past three months that the European coun-try overtook the US, he said.

Dutch tourists account for 3.21% of the 1,982,274 foreign tourists who came to Bali in the January-October 2009 period, he said.

Compared to the same peri-od last year, the number of tour-ist arrivals in Bali in the year end-ed October 2009 rose 14.22%, he said.

Ida Komang said six of the ten biggest sources of foreign tourists contributed significantly to the total number of tourists visiting Bali over the period. The num-ber of tourists from China rose 65.29%, France 51.07%, Aus-tralia 35.46%, Dutch 22.91%, Britain 12.36%, and Malaysia 9.14%.

VP Boediono : In Indonesia, Science Will Prevail

He said around Rp2,000 tril-lion of investment was needed between 2009 and 2014.

“As the government is only able to provide a small part of it, the rest should be acquired from outside the regional and national budgets from home and abroad,” he said.

He pointed out that to achieve high growth and investment lo-cal and central governments must keep improving technical and non-technical infrastructure.

Aceh Governor Irwandi Yusuf meanwhile said the Aceh people had now recovered from the di-saster.

“The conflict and tsunami are no longer seen as disasters but op-portunities to build a peaceful, just, prosperous and dignified life and making progress in all sec-tors,” he said, adding that the tsu-nami disaster had in fact expedit-ed the peace settlement in Aceh.

He said infrastructure devel-opment continues to take place

throughout Aceh, and that so far 124,454 housing units, 3,000 ki-lometers of roads, 1,400 school buildings and 20 ports had been constructed while 1,300 hectares of land have been turned arable.

“There are still unfinished projects left, namely the 1,106 ki-lometer-long road development projects in the central region, un-employment and housing for tsu-nami victims. These are problems that have to be given attention,” he said.

Photo courtesy of: www.vibizdaily.com

RI and the ASEAN-China FTAThe fate of the ASEAN-China FTA, as part of the new cabinet’s first 100 days program, has been sidelined by many controversial domestic political issues that need to be resolved comprehensively and in an integrated manner.

PAGE 2

ViewpointThe President Post www.thepresidentpost.comDecember 25, 20092

Aspects of National Security

By Sayidiman Suryohadiprojo

A well functioning National Security System will enable a nation to have a peaceful and orderly life to maintain and increase productivity and prosperity. A productive and prosperous nation

will, conversely, be able to enhance its security.

N ational Securi-ty is the situation of a nation relat-ed to its well-main-

tained and orderly life, its stabili-ty, and the normal functioning of its government to achieve the na-tion’s objectives.

Issues pertaining to National Security are developments that threaten and endanger that situ-ation. They can range from rela-tively simple criminal matters to the dangers of narcotics to public life, activities of organized crime, actions to subvert the nation with or without foreign participation, terrorist actions, secession senti-ments among segments of the na-tion and, last but not least, open military attacks by foreign forces.

To safeguard itself from the negative result of all these possi-ble actions, a nation should estab-lish a National Security System. A National Security System is a system established by the govern-ment to develop the capability of the nation to safeguard its na-tional life with all its various as-pects against any threat and chal-lenge coming from inside as well as from outside the nation.

A well functioning Nation-al Security System will enable a nation to have a peaceful and orderly life to maintain and in-crease productivity and prosperi-ty. A productive and prosperous nation will, conversely, be able to enhance its security. There is

therefore a close relationship be-tween National Security and Na-tional Prosperity, which together will result in the national resil-ience of a nation.

There is often a misconception, also in Indonesia, to separate Na-tional Defense from Nation-al Security. This misconception considers National Defense as a different category of efforts and limited to the preparation and execution of military actions against an open foreign military offensive. That was indeed the case in the 19th century. How-ever, since the early 20th century conflicts and wars among nations have became a total effort of a na-tion. An offensive by an aggres-sive nation using military means no longer limits its objectives to military positions and facilities only. The use of air power to at-tack non-military objectives such as production centers and com-munication facilities has become a normal strategy to weaken the opponent’s military.

And to wage a war, a nation needs capabilities far beyond that which is provided by a profes-sional army. As the wars waged by Napoleon Bonaparte showed, the army is in need of more mem-bers, and this can only be met by mobilizing citizens. War efforts also include the mobilization of the economy. War is no longer a military activity; the whole na-

tion can be at war to defend it-self. Therefore, one cannot dis-cuss defense without looking at the wealth and the prosperity of a nation, which in turn is very strongly influenced by its nation-al security.

Since World War II the issues surrounding how to survive a for-eign offensive have become much more complicated. Military of-fensive actions are often preceded by non-military attacks against the opponent’s society, with the objective to weaken its resistance, morally and mentally. In 1939 Austria was morally and mental-ly so weakened by Nazi Germa-ny’s subversion that it agreed to unite with Nazi Germany (An-schluss) without German mil-itary actions. After World War II, the West under US leader-ship and the Communist bloc with the Soviet Union as its lead-er were entangled in very danger-ous confrontation. But both sides took care that the conflict would not escalate into an open military war which could become total de-struction on both sides caused by the tremendous effects of nucle-ar power. What became the real-ity was the Cold War. Both sides continued to strengthen their military power and their weap-ons of mass destruction (WMD, or nuclear, biological and chemi-cal weapons) to enhance their le-verage to prevail over the confron-tation. However, the Communist

bloc and the Soviet Union were totally defeated without both sides firing a single missile—the Communist bloc proved to be unable to withstand the non-mil-itary attacks against its society.

It is for an aggressor nation today much more attractive to achieve its goals without an open military offensive. Launching a military attack is today very cost-ly, even if the target of aggression is a relatively small nation. The US needed more than $700 bil-lion to finance its military adven-tures to Iraq and Afghanistan. Moreover, it might require sig-nificant changes in the aggres-sor nation’s life, like the need for more people to build the neces-sary military organization. This could cause negative effects in the mood of the people, all the more so if recruited citizens be-come victims in military actions, as attested in US society since the Iraq War. There is also a political risk if it proves that the offensive cannot achieve its objectives. The US has to experience domestic as well as international political set-backs because it has not been able to achieve its real objectives in Iraq and Afghanistan.

An attack without military means can be much more pro-ductive today, especially if the target nation can be weakened by non-military actions. It is certain-ly much cheaper and the risk of a

failure can be very limited. And if military means are needed in ad-dition to non-military efforts, the actions will be much more limit-ed because the target nation’s re-sistance are already weakened by non-military actions. Sun Tzu, the famous Chinese strategist, stated that the best commander in war is the one who can defeat his enemy without or with a min-imal amount of military or phys-ical means.

Since people all over the world have made progress in many as-pects of life, it is not longer sim-ple and easy to defeat its will to resist. Although the aggressor has won the military war total-ly, like the US against Iraq in its first war, the people can still resist and mount a struggle which ul-timately defeats the aggressor, as the Dutch experienced in Indo-nesia in 1949. It is therefore nec-essary for an aggressor not only to win militarily, but to win the peace. It means that the aggres-sor is able to make the people of the target nation submit itself to the will of the aggressor. The best example is the termination of World War II, in which the US was able to change Japan from a fanatical opponent during the war into its strongest ally in Asia after the war. The US had not only won the war against Japan, but also the peace. It is therefore very strange but remarkable that the US could not repeat its Japa-

nese success in Vietnam and now in Iraq, although both these na-tions are less developed nations and not to be compared to the US as a military and economic superpower.

All this indicates the very broad scope of National Security today which requires the most ef-fective use and application of na-tional means and capabilities. It is therefore important that a nation has a National Security Coun-cil chaired by the Head of State himself, with all cabinet minis-ters as members and administrat-ed by a secretary general. In ad-dition to the ministers, important officials such as the Command-er of the Armed Forces, the Head of the National Police, the Chair-man of the National Intelligence and other experts must be invited to attend meetings.

The Head of State as Chair-man of the NSC will direct the nation’s efforts to cope with all National Security problems ef-fectively, and will prevent possi-ble duplication in tasks or gray areas involving other government departments, armed forces and police.

The writer is a retired three-star Army general and the former chairman of the Indonesian Resilience Institute (Lemhanas). He also served as Indonesian ambassador to Japan.

It is therefore important that a nation has a

National Security Council chaired by the Head of State himself, with all

cabinet ministers as members and

administrated by a secretary general.

In addition to the ministers,

important officials such as the

Commander of the Armed Forces,

the Head of the National Police, the Chairman of the National

Intelligence and other experts must be invited to attend

meetings.

T he Indonesian con-tingent finished third at the recent SEA Games in Laos, a

modest feat indeed. In imple-menting the ASEAN-China Free Trade Agreement (FTA), howev-er, Indonesia lags far behind the event’s host country, which re-mains calm and not panicky as our business elite are in facing the onslaught of imported goods from China.

The fate of the ASEAN-China FTA, as part of the new cabinet’s first 100 days program, has been sidelined by many controversi-al domestic political issues that need to be resolved comprehensi-vely and in an integrated manner. We are again inundated by many classic problems that undermine our competitveness.

Our weak physical infrastruc-ture and institutional infrastruc-ture (legal certainty) or soft in-

RI and the ASEAN-China FTA

By Christianto Wibisono

frastructure which continues to plague us need to be settled soo-nest. The Bank Century im-broglio, which is partisan and sectarian in nature, has put our credibility amongst potential in-vestors in question.

What are the reasons behind our industries to remain weak and uncompetitive not only against China but, more serious-ly, amongst ASEAN members? Why are our industries decaying and continue to seek government protection? If red tape continues to burden industries, while our physical infrastructure remains insufficient, it is the task of the government to overcome them pro-actively and rapidly. Indeed, the government has found the right term, “debottlenecking”, which it pledges to do within 100 days.

Most of our businesses are champions in their own turfs and

have yet to reach a sophisticated level required for them to operate outside their own country.

Indonesia has many industries that enjoy state protection, both state firms as well as private con-glomerates. In many seminars I have always pointed out that providing protection to busi-ness companies is akin to giv-ing a child nutritious food and supplements in order for them to perform once they enter their schoolong years. But protection-ism must only be given for a cer-tain timeframe and not perma-

The fate of the ASEAN-China FTA, as part of the new cabinet’s first 100 days program, has been sidelined by many controversial domestic political issues that need to be resolved comprehensively and in an integrated manner. We are again inundated by many classic

problems that undermine our competitveness.

We must all have self-confidence, be assertive and strongly believe that Indonesia’s meritocracy, multiculturalism and pluralism will enable us

to be on a par with global powers such as China and India.

nently. A businessman that enjoys pro-

tection should be able to ‘gradu-ate’ after a certain period of time and be ready to compete against others. That is the story behind the rise of Germany, Japan and Korea in the wake of the indus-trial wave as pioneered by Great Britain. This is the essence of mercantilism and protectionism of infant industries that was de-veloped by the renowned Ger-man economist Friedrich List in order to help Germany cope against British imports.

I have always said to the top

management of conglomerates and state firms that if they were toddlers then it is normal and commendable if they get breast-fed as it makes them healthy and strong. But once they become ad-olescents but remain to be breast-fed, that is not protectionism but pornography. That also becomes a sinful act bordering on com-mercial incest. Industries that are incestuous due to perpetual pro-tectionism become uncompeti-tive as they are spoiled, lazy and mentally defect and are devoid of true entrepreneurship and cre-ativity.

Now, 15 years after then presi-dent Soeharto in 1994 confident-ly, along with then US president Bill Clinton, launched free trade among APEC members, Indone-sian industries continue to pester the state. What went wrong af-ter those 15 years? The Asian fi-nancial crisis has come to an end, and Indonesia has recovered from it. Many have now come to rec-ognize three new Asian giants, ChInDonesia (China, India dan Indonesia). These three countries have posted significant growth while others make do merely by surviving. What is wrong with our industries, our businesses and our economy?

We must all have self-confi-dence, be assertive and strongly believe that Indonesia’s meritoc-racy, multiculturalism and plu-ralism will enable us to be on a par with global powers such as

China and India.

Editor’s note:The writer is the CEO of GNI

(Global Nexus Institute), which is set to hold the CEO Summit: “Empowering Indonesia Inc. & ASEAN Inc. When China Rules the World” by featuring Martin Jacques, the author of the bestsell-er “When China Rules the World” on January 26.

The Ambassador of China to Indonesia, Zhang Qiyue, and the Secretary General of ASEAN, Su-rin Pinnsuwat, have been invited to take part in discussions during the seminar.

Wibisono will moderate the dis-cussions with the aim, he says, “to synergize the forces within Indone-sia Inc. in order to respond correctly to the current strategic and geopo-litical transformation.”

Motorcycle and furniture: two of Indonesia’s industries that cannot cope with the onslaught of Chinese imports

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The President Postwww.thepresidentpost.com December 25, 2009 3

The Region

T he ASEAN Econom-ic Community (AEC) is one of the three pil-lars of the regional in-

tegration process in the region. Six years since its inception, this grand scheme has fallen far short from its goals.

AEC was formed as one of the three pillars of ASEAN Commu-nity, the other two being ASE-AN Security Community and ASEAN Socio-Cultural Com-munity. It represents the com-bined population of 10 South-east Asian countries that amount to more than 500 million peo-ple. This is bigger than that of the European Union and the US. Their combined GDP is US$ 1.5 trillion, making it one of the big-gest economies in East Asia aside from China and Japan.

A DEEP ECONOMIC INTEGRATIONThe spirit of AEC was intro-

duced back in 1997 when mem-ber countries created the ASEAN Vision 2020 that called for an “ASEAN Economic Region that entails free flow of goods, servic-es and investments, a freer flow of capital, equitable economic devel-opment and reduced poverty and socio-economic disparities.”

The end goal of an AEC was further identified in Bali Con-cord II. AEC was set to achieve the following objective: “… ASE-AN as a single market and pro-duction base, turning the diver-sity that characterizes the region into opportunities for business complementation... a more dy-namic and stronger segment of the global supply chain” by the year 2015.

Two main end goals were laid down: a single market and a sin-gle production base.

By single market, AEC seeks to maximize the dynamic and grow-ing regional economies. This is supported by the fact that ASE-AN is a huge market, and that there has been stable increase in

The Economic Integration of ASEAN: An Assessment

By Carolyn Sinulingga

intra-ASEAN trade over the past years. The elimination of trade barriers would encourage more trade and, in consequence, con-tribute to the economic growth of member countries.

A single production base re-flects a state where the intercon-nectedness of ASEAN economies creates a more efficient business environment. Through substan-tial reduction of production cost in the region, AEC is positioned to be a more competitive region-al bloc, thus shifting the trend of FDI-inflow from big powerhous-es such as China and India to-wards the community.

THE MAIN STRUCTURE OF AECThe main body of AEC can

be referred back to the existing economic cooperation in ASE-AN such as ASEAN Free Trade Agreements (AFTA), ASEAN Framework Agreement on Ser-vices (AFAS), and Agreements on Investment Area (AIA). These initiatives have been successful in promoting structural changes in economic relations of ASEAN countries.

In terms of trade in goods, sub-stantial reduction of tariff bar-riers has been accomplished. In 1993, when Common Effective Preferential Tariff (CEPT) for the AFTA was first implement-ed, the average tariff rate of ASE-AN-6 was 12.67%. In 2008, it was 0.79%. As for CLMV, the tariff rate is now cut to 3.69%, compared to 7.51% in 2000.

Under AFAS, ASEAN has un-dertaken changes to encourage higher mobility of professional services through liberalized sec-tors. Commitments were made to reduce restrictions to trade, especially in the following sub-sectors: business services, pro-fessional services, construction, distribution, education, environ-mental services, healthcare, mar-itime transport, telecommunica-tions, and tourism.

The initiative also provided Mutual Recognition Arrange-ments as a mechanism to facil-itate recognition of profession-al qualifications. The opening up of market on services led to strong growth of export and im-port of commercial services, ris-ing from US$183 billion in 2003 to US$329.5 billion in 2007.

As for the changes in the area of investment, AEC aims to re-duce impediments of investment. Through the formulation of AIA in 1998, which was further en-hanced by the creation of ASE-AN Comprehensive Investment Agreement (ACIA) in 2009, a se-ries of efforts to improve invest-ment climate was carried out. It seeks to create a transparent and non-discriminatory treatment of ASEAN-based investors and oth-er investors coming from outside the region. Between 1998 and 2008, ASEAN has experienced robust growth of FDI-inflow, with an average 14.8% growth annually.

SLUGGISH PERFORMANCEDespite these achievements,

ASEAN’s economic integration process does not seem to bring the desired result. Five years after the AEC came to being, ASEAN economies have yet grown signif-icantly closer to each other. Their economies have, indeed, been growing vastly, but not in a re-gional approach as defined in the spirit of AEC.

Both intra-ASEAN trade and extra-ASEAN trade grew in a rel-atively similar speed (Figure 1). The last five years, particular-ly, has seen two-fold growth of both types of trade. Extra-ASE-AN trade rose from US$600 bil-lion in 2003 to US$1,252 billion in 2008, whereas, intra-ASEAN trade increased from US$200 billion to US$458 billion. This growth of trade is, however, not driven by AFTA, and the initia-tive itself is underutilized.

Amidst the increasing percent-age of business lines included in the CEPT-AFTA initiative (Fig-ure 2) only 5% of intra-ASEAN trade comes from the application of AFTA. This is partly due to the lack of knowledge amongst the private sector on the existence of this procedure and, most im-portantly, the processing cost that exceeds saving after an AFTA ap-

plication. In the area of trade in services,

while barriers have been dimin-ished, AFAS is implemented in a slow and uneven manner. There has been low commitment from other ASEAN countries, aside from Singapore and Malaysia, to significantly liberalize their ser-vice markets. The poor quality of regulation and management has also hindered this initiative be fully implemented and to maxi-mally benefit the region.

Regarding efforts to attract more investment to the region, the same lack of commitment by member countries has posed a challenge to the implementation of AIA. Ten years after the agree-ment was implemented, no con-crete impact has been felt. Mem-ber countries’ reproduction of “sensitive list” of areas that should not be included in the agreement is the main reason of the slow im-plementation of AIA. This re-sulted in the low performance of intra-ASEAN FDI-flow, as com-pared to that of other countries from outside the region (Figure 3)

KEEPING FAITHWhy should we keep faith in

the AEC? ASEAN is a growing economy

which has shown robust growth over the years. According to data published by ASEAN Secretariat on November 2009, although the recent global economic down-turn has resulted in deep contrac-tion of some member economies, one can be content with the re-gional average growth of 4.4%. As for the CLMV, these countries have been showing a remarkable

The ASEAN Economic Community was formed as one of the three pillars of ASEAN Community, the other two being ASEAN Security Community and ASEAN Socio-Cultural Community.

6% economic growth in 2008 alone, evidence of its great poten-tials that warrant explorations in the future (Figure 4). Looking at these developments, it is correct to say that ASEAN is growing to become a great economic force in the years to come. Therefore, it is an imperative for the AEC to be successfully implemented.

What are the lessons that can be learned from ASEAN’s eco-nomic integration?

The creation of AEC Blueprint in 2007 has added to the already long list of documents and sched-ules set for the integration pro-cess. The problems facing AEC lie in the management, not the formulation, of initiatives. Over the years ASEAN officials have not slowed down in coming up with new cooperation schemes although existing ones are still far from being (fully) implemented.

For that reason, more efforts should be given to reform the ex-isting structure to have the need-ed resources in achieving pre-de-termined goals of AEC.

As noted by Hadi Soesastro, ASEAN needs to find a “new ASEAN way” which incorpo-rates so-called “defining ele-ments” that would further deepen the integration. As he further ex-plained: “Without a treaty, with-out transfers of powers, and with-out any budget, one should not expect a credible ASEAN Eco-nomic Community to emerge.”

This change is something all have been waiting for. If a single market in 2015 is to be achieved, there is no time for ASEAN to refrain from introducing much-needed reforms.

Source: ASEAN Trade Database

FIGURE 1: TREND OF ASEAN TRADE

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Source: ASEAN Tariff Database

fIgurE 2: PErCENT Of TArIff LINES IN THE CEPT INCLuSION LIST (IL)

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The percentage of tariff lines in the CEPT (Common Effective Preferential Tariff) inclusion list of CLMV have increased steadily, and progressively narrowed the gap between ASEAN6 and CLMV over the years. As of 2009, both ASEAN6 and CLMV have placed more than 98% of their tariff lines under the CEPT Scheme

Note: For 2009, Cambodia use the ASEAN Harmonised Tariff Nomenclature (AHTN) 2002 while the others use AHTN 2007

Source: ASEAN FDI Database

FIGURE 3: FDI INFLOW TO ASEAN

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FIGURE 4: ANNUAL GROWTH RATE OF GDP AT CONSTANT PRICES IN ASEAN MEMBER STATES

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Source: ASEAN Finance and Macroeconomic Database

Notes:ASEAN6 = Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore, Thailand.CLMV = Cambodia, Laos PDR, Myanmar, Vietnam.

2008 2009 2010 2011

Gross domestic Product 6.1 4.3 5.4 6.0

Consumer price index 9.8 4.7 5.6 6.5

Major trading partner growth 2.1 -1.8 3.3 3.4

Poverty rate 15.4 14.2 13.6 11.5

Source : MoF, BPS via CEIC and World Bank

TABLE 2: GROWTH IS PROjECTED TO GRADUALLy RETURN TO MORE TyPICAL RATES IN THE COMING yEARS(ANNuAL PErCENTAgE CHANgE)

YEAR - MONTHEXPORT IMPORT

OIL & GAS NON OIL & GAS TOTAL OIL & GAS NON OIL & GAS TOTAL

2004 15,645.3 55,939.3 71,584.6 11,732.0 34,792.5 46,524.5

2005 19,231.6 66,428.4 85,660.0 17,457.7 40,243.2 57,700.9

2006 21,209.5 79,589.1 100,798.6 18,962.9 42,102.6 61,065.5

2007 22,088.6 92,012.3 114,100.9 21,932.8 52,540.6 74,473.4

2008 29,126.3 107,894.2 137,020.4 30,552.9 98,644.4 129,197.3

2009 10,316.9 59,984.4 70,301.3 10,766.9 49,001.0 59,767.9

January 1,025.5 6,254.6 7,280.1 1,281.5 5,319.1 6,600.6

February 1,024.5 6,109.9 7,134.3 964.4 4,974.6 5,939.0

March 1,281.6 7,333.1 8,614.7 930.1 5,624.1 6,554.1

April 1,253.9 7,200.0 8,454.0 1,232.3 5,474.5 6,706.8

May 1,136.7 8,072.1 9,208.8 1,560.1 6,081.1 7,641.3

June 1,452.1 7,929.4 9,381.5 1,441.8 6,493.7 7,935.5

July 1,488.9 8,195.2 9,684.1 1,836.8 6,846.5 8,683.3

August 1,653.6 8,890.1 10,543.8 1,519.9 8,187.4 9,707.3

Source: Central Board of Statistics

TAbLE 1: INdONESIAN TrAdE 2004 - 2009

The EconomyThe President Post www.thepresidentpost.comDecember 25, 20094

2010: Prospects and OpportunitiesGovernment to liberalize 8,000 commodities

Indonesia enjoys a US$14.27 billion surplus in The government plans to liberalize the import of around 8,000 commodities from other ASEAN member states in January 2010 in the framework of the Free Trade Agreement (FTA), a Finance Ministry official said.

Some of the commodities are currently subject to 2.5-5% duties, he said.

“Duties on the import of commodities from China will be lowered to 3%,” the head of the ministry`s fiscal policy board, Anggito Abimanyu, said here last week.

The new ruling would be issued five days before January 1, 2010, he said.

Four RI seaports to operate 24 hours per day Four seaports in Indonesia will operate 24 hours a day as of February 2010,

Director General of Sea Transportation Sunaryo said here last week.The four seaports are Belawan in Medan, North Sumatra, Tanjung Priok in

Jakarta, Tanjung Perak in Surabaya, East Java and Soekarno-Hatta in Makassar, South Sulawesi.

“The 24-hour service includes ship escorting service and readiness of the port administration to serve docking ships at any time,” he said.

A 24-hour service program will also be carried out in several first class ports in the country besides the four seaports but the program would be implemented in stages, he said.

demand for LPg to reach 4.34 million tonsin 2010

PT Pertamina predicts domestic need for qualified petroleum gas (LPG) in 2010 will reach 4.34 million tons.

The state-owned company`s marketing deputy director, Hanung Budya, said here on Tuesday of the total, 3.08 million tons would be for subsidized 3-kg container consumers and 1.26 million tons for non-subsidized consumers.

He said the LPG supply will come among others from the company`s refinery plants totaling 818,545 tons, the company`s upstream operations 52,920 tons, other contractors 969,724 tons, domestic private refinery plants 88,550 tons and imports through Petredec 1.5 million tons.

The rest, he said, will be acquired through additional imports or the refinery in Bontang.

Hanung said on December 29, an LPG terminal with a capacity of 10,000 tons in Gresik, East Java, will start operating increasing supply reliability.

government subsidizes sugar for the poor

The government is set to subsidize sugar for the needy, Deputy Agriculture Minister Bayu Krisnamurthi has said.

He added that the subsidized sugar would be designed for certain groups of people or certain target families (RTS).

“So, this a targeted recipient subsidy,” he told news media last week.

He said that the subsidy would be provided in view of the likely increase in the price of the commodity following the projected decline of stocks in the country.

West Java allocates rp40 b for foodresilience scheme

The West Java government has provided Rp40 billion for the development of food resilience in the province, West Java Governor H. Ahmad Heryawan said.

“The aim of the assistance is to develop food self-sufficiency by involving all stakeholders in food programs. This program follows up the same program that had been implemented previously,” he told Antara.

West Java`s rice production in 2008 was recorded at 10.4 million tons of dried unhulled rice, said the Central Board of Statistics (BPS) s estimates, and its s rice production in 2009 was projected to increase by 1.65 million tons.

Anggito Abimanyu

ECONOMIC BRIEFS

The United Nations predicts that the global economy will bounce back in 2010, but it also warns that the recovery will be fragile.

By Atmono Suryo

GLOBAL DEVELOPMENT

T he general consen-sus among prom-inent economists is that the world is

firmly on the road to recov-ery and that 2010 holds good prospects, especially for fast-moving and expanding Asia. The world, however, is being warned that global recovery will be sluggish: Uncertainties will remain, stabilization and economic growth will be un-even and the problem of un-employment will persist.

The United Nations pre-dicts that the global economy will bounce back in 2010, but it also warns that the recovery will be fragile. International fi-nancial institutions such as the World Bank and the IMF have come up with similar fore-casts.

There is also grave con-cern, however, about the pos-sibility that the global recovery will not be sustainable. There is even the possibility that the global economy or some indi-vidual countries could enter into a recession and will not follow the “V-Type” scenario.

With the steep downturn at the beginning of 2009, world growth is estimated to be 2.2% for 2009 and 2.4% for 2010. Estimates on growth rates dif-fer and are changing continu-ously.

In the industrialized world, the U.S. economy is forecast to grow by 2.1% in 2010, while EU countries’ and Japan’s growth figure would be small-er. The U.N. predicts that only 21 developing countries will have growth rates of 3% or more; 60 developing countries will register a decline in per capita income.

fAST- MOVINg ASIAThe economic situation in

Asia is quite remarkable. This vast region is now often called “Incredible Asia”. Preliminary forecast indicate that the busi-ness prospects in Asia for the year 2010 are promising.

The IMF has therefore sug-gested that Asia take a leading role in reshaping the Post-Cri-sis Global Economy. The best solution, however, would be for the G20 to take the leading role with the support of Asia, which now makes up about one-third of the global economy.

With Asia to be involved in the global recovery the oppor-tunity will be opened for Asian business to take advantage of the upturn in world trade and investment.

There may be business op-portunities in advanced coun-tries as they increase their eco-nomic activities. But it would be limited; it is not expected that demand in those countries would greatly improve. Their

purchasing power would still be limited in 2010.

KEy MARKETSAs predicted, the most promis-

ing market in the global economy is Asia, particularly with the re-markable rise of China, followed by India and other Asian coun-tries. Indonesia is often men-tioned as the third most potential emerging country in Asia.

According to the IMF WEO (World Economic Outlook) Chi-na’s GDP in 2009 is set to reach US$4.8 trillion, but still behind the US and Japan. In 2010 the figure is expected to be US$5.3 trillion.

The most interesting forecast is China as the world’s second larg-est economy in 2010, replacing Japan. That would create a big change in the world’s economic power structure.

China’s exports have been making a comeback as consum-ers in the United States and oth-er advanced countries start to increase their spending. Facto-ry output, investment and retail sales in China are growing.

An important development in China is that the country is also working to boost imports and in-crease domestic demand. Accord-ing to statistics, US$2.47 trillion have been spent in 11 months in 2009 in factories and other con-struction projects.

ASEAN- CHINA

ASEAN-China trade has achieved high growth, which was stimulated by China’s accession to the WTO and with its deeper integration into the world econo-my. Various observers are of the view that there is high poten-tial in developing ASEAN-Chi-na economic relations. Not only in the area of trade, but also in the areas of investment, joint ven-tures and investment.

On the other hand, China and ASEAN are developing countries and are competing against each other. The Indonesian market is already flooded with various products from China, at low pric-es and of better quality. It com-prises not only of textiles and gar-ments but also motorcycles and other industrial products.

INDONESIAChina is a huge market for vari-

ous products from ASEAN coun-tries. For Indonesia, in particular, it is important to note that Chi-

na is a great potential country for our exports, especially coal, min-erals, natural rubber, wood and wood products, pulp and paper.

Indonesian exports of non-oil and gas to China went up from US$6.6 billion in 2005 to US$8.3 billion in 2006, US$9.6 billion in 2007 and US$11.6 bil-lion in 2008. Imports from Chi-

na show higher figures, reach-ing US$15.2 billion in 2008. This means that Indonesia suf-fered a trade deficit with China of US$3.6 billion in 2008.

As can be seen from Table 1, Indonesian trade has been im-proving since 2004.

According to BPS (the govern-ment-run statistics body) Indo-nesia’s non-oil & gas exports in 2007 go to 10 main trading part-ners, namely Japan, the US, Sin-gapore, China, India, Malaysia, South Korea, the Netherlands, Thailand and Taiwan. Out of the

ten countries, seven are in Asia. This means that Asian countries are is Indonesia’s greatest trading partner.

China and India have become important trading partners of In-donesia. Total trade with India went up from US$3.9 billion in 2005 to US$6.5 billion in 2007 and US$10 billion in 2008.

As Asia is predicted to grow faster than the other regions in the world, Indonesia’s export po-sition for non-oil and gas is se-cured. Exports are expected to increase in 2010 by 5%, while economic growth is projected at 5.4% in 2010, possibly even 6%. THE yEAR 2010

2010 will be a critical year for the global economy. The world economy still abounds with un-certainties, recovery is expected to be sluggish, but prospects re-main rosy.

There is the need to reshape the Post-Crisis Global Economy. The G20, which includes five Asian countries, should take the lead with Asian support.

It is expected that the post-cri-sis period will see competition on the rise, which in turn will en-large the risk of protectionism. It should be kept in mind that Asia’s growth during the last few decades was spurred by the ex-pansion of open market econo-mies and remarkable increase in international trade.

The 2010 economic outlook for Asia, with Indonesia among the top countries, ranges from “good to bright” in the areas of economic stability and growth, expanding trade, positive balance of payments, adequate financial flows, high foreign exchange re-serves, expansion of domestic and regional demand and the possible increase in FDI.

Now is the time for Asia to tap into its increasing potentials in order to further strengthen their economies and businesses and so-lidify their position in the glob-al economy. Closer economic co-operation and integration among Asian countries is however im-perative, as well as efforts to cope with political issues which tend to hinder business development and economic growth in the re-gion.

H. Ahmad Heryawan

The 2010 economic outlook for Asia, with Indonesia among the top countries, ranges from “good to bright” in the areas of economic stability

and growth, expanding trade, positive balance of payments, adequate financial flows, high foreign exchange reserves, expansion of domestic and

regional demand and the possible increase in FDI.

The Economy


Boosting RI-EU Trade and InvestmentIt should be realized by the Indonesian private sector that the European

Union is presently the largest global trader with a total trade volume of more than US$3.6 trillion in 2007.

By Atmono Suryo

A t this present stage of global recovery and growth, it is of con-siderable importance

for Indonesia to expand its exter-nal economic relations, especial-ly in trade and investment, not only with Asian countries but also with other potential regions, including the European Union (EU).

On that score the seminar or-ganized by Eurocham and sup-ported by the Delegation of the European Union should serve as an eye-opener for the Indonesian public. Most Indonesians may not realize that the Europe of to-day is different from the Europe of some ten years ago, particu-larly in terms of economics and business.

The present European Union covers a very large economic area, almost as large as the North American continent.

It should be realized by the In-donesian private sector that the European Union is presently the largest global trader with a to-tal trade volume of more than US$3.6 trillion in 2007. It is also the largest exporter and import-er of commercial services in the world. Furthermore in ASEAN the EU is a highly leading invest-ment partner.

The seminar which discussed in detail trade and investment opportunities and obstacles be-tween Indonesia and EU was at-tended by Minister of Trade Dr Mari Elka Pangestu and EU Am-bassador Julian Wilson, both of

whom who made important ob-servations. They recognized that the opportunities to expand trade and investment are large and should be tapped. The existing obstacles, however, should there-fore be removed as far as possi-ble.

INdONESIA-Eu TrAdEAccording to the studies re-

vealed at that meeting, in 2008 the EU (27) was the third larg-est trading partner of Indonesia after Singapore and Japan. The very large trade volume between EU and Singapore is quite re-markable. It will be noted, how-ever, that a significant part of the trade and economic interac-tion between the EU and Indo-nesia occurs through Singapore. In addition, the EU is a leading investment partner of Indonesia. The importance of EU as a very potential economic partner for Indonesia is not duly recognized here.

Compared to other ASEAN countries in terms of percent-age, Indonesian exports lag be-hind. EU imports in 2008 came from Malaysia (25%), Thailand (25%), Singapore (23) and Indo-nesia 19%.

For most Indonesian traders the European market is difficult to penetrate. They recognize that European standards are high and regulations are strict. Many of the traders are also not aware of the opportunities open to them. A “learning process” may be need-ed for many Indonesian traders.

It will be noted that EU ex-ports to Indonesia consist of more sophisticated items such as telecommunications and various types of machinery. They also in-clude specialized capital equip-ment and high technology prod-ucts as well as specialized food and consumer products.

The most important Indone-sian exports to the EU are more simple products such as apparel articles and clothing accessories. Also, footwear, cork and wood manufactured items, vegetable fats and oils. There are a number of products of a more sophisti-cated nature such as telecommu-nications and sound-recording equipment. Indonesia is still eligi-ble for GSP (general systems pref-erences) treatment.

Indonesia has always been an important exporter of commod-ities and raw materials. The ques-tion arises whether it would be time for the country to upgrade its export products by starting to process commodities to become more sophisticated, higher-priced and well-packaged attractive con-sumer items.

As Indonesia is blessed with natural resources, the time has come for the country to develop resources-based and value-add-ed industries to cater for the ex-panding domestic market and to increase exports.

EU INVESTMENT In ASEAN, the EU is by far

the largest source of FDI (for-eign direct investment). EU FDI flows to Singapore, Thailand,

Malaysia, Indonesia and the Phil-ippines. Compared to the other three ASEAN countries, Indo-nesia again lags behind, as is the case with trade. Poor investment and business climate are the main reasons, but Indonesian statistics show there have been improve-ments during the last two years in the flow of EU FDI to Indo-nesia.

Table 1 indicates possible in-vestment opportunities in Indo-nesia (but they are largely in the negative list).

The indicated areas with high potential are: construction, ma-chinery and electronics – trans-port and communications -- ho-tel and restaurant, and the food industry.

According to EU studies In-donesian domestic investors have concentrated their projects in food, chemicals and pharmaceu-ticals. Foreign investment is con-centrated in large plantations, chemicals, automotive, machin-ery, pharmaceuticals, transporta-tion, warehousing, communica-tions and construction.

European investors in Indone-sia have focused their investments on market-seeking investments, and to a lesser extent resource-seeking. They are apparently not focused on the oil & gas and en-ergy sectors.

European observers, howev-er, agreed that in terms of over-all attraction to invest, Indonesia has some advantages over other countries. Indonesia has a sound growth pace, an improved de-gree of macroeconomic stability,

a large domestic market and ex-panding market potential.

In addition, ASEAN integra-tion will offer new opportunities in terms of expanding markets. It would be of strategic importance if European investors would see the advantage of establish-ing their stronghold in Indone-sia. However, this requires greater confidence on the part of EU to-wards Indonesia.

Indonesia is a potential power-house with a large expanding do-mestic market, a large variety of natural resources and a fast ex-panding middle-income group (more than 10 million people) with better education and of young age.

In the years ahead Indonesia is set to become one of the main bases of the EU to maintain clos-er economic interactions with: that is a big opportunity as well as a challenge for the EU and In-donesia.

2006 2007 2008 2009E* 2010E*

National Accounts

Real GDP (% y-o-y) 5.5 6.3 6.1 4.3 5.2

Domestic demand ex. inventory (% y-o-y) 3.7 6.0 9.1 3.4 6.9

Real Consumption: Private (% y-o-y) 3.2 5.0 5.3 5.1 5.0

Real Gross Fixed Capital Formation (% y-o-y) 2.9 9.2 11.7 3.9 8.0

GDP (US$bn) — nominal 364 433 507 532 641

GDP per capita (US$) — nominal 1,641 1,925 2,227 2,309 2,744

Open Unemployment Rate (%) 10.3 9.8 8.6 9.9 9.8

External Sector

Exports, fob (% y-o-y, US$ bn) 19 14 18.3 -19.0 11.0

Imports, fob (% y-o-y, US$ bn) 6.3 15.4 36.8 -26.7 15.8

Trade balance (US$ bn) 29.7 32.8 22.9 27.6 26.5

Current account (% of GDP) 3.0 2.5 0.1 1.8 0.5

Central government debt (% of GDP) 39.2 35.1 32.0 29.9 28.2

International Reserves –IRFCL (US$ bn) 42.6 56.9 52.1 64.8 71.1

Merchandise import cover (months) 4.5 6.2 5.4 9.4 9.0

Currency/US$ (Year-end) 9,020 9,419 11,120 9,600 9,750

Currency/US$ (Average) 9,143 9,163 9,767 10,350 9,675

Other

BI policy rate (% year end) 9.75 8.00 9.25 6.50 7.50

Consumer prices (% year end) 6.60 6.60 11.20 4.00 6.70

Fiscal balance (% of GDP; FY) -1.0 -1.3 -0.1 -1.9 -1.0

S&P's Rating -FCY BB- BB- BB- BB BB

INDONESIA: SELECTED ECONOMIC INDICATORS

Source: CEIC, *Danamon Estimates

DECEMBER INFLATION PREVIEW: MILD SEASONAL PRESSURES

D ecember data would be announced ear-ly next year. Our forecast for month-

on-month inflation is at 0.57%, with inflationary pressures ex-pected to come mostly from non-food components of CPI, such as housing (kerosene, cement), clothing (including gold accesso-ries up by 7.9% mom), education, sports & recreation, and trans-portation & communications. Although some food prices re-mained relatively stable (cooking oil, chicken, rice, and meat), oth-ers (sugar, corn, and soy bean) in-creased rather significantly.

Accordingly, year-on-year headline inflation may increase moderately to 3.04% from 2.41%. Core inflation is also ex-pected to climb from its low of 4.29% last month, in part due to a high base effect.

Generally, inflationary pres-sures are probably still out of sight as far as incoming data is concerned. Prices of some com-modities such as gold and palm oil have increased lately, but the inflation impact should be some-what counterbalanced by the strengthening of the rupiah in re-cent months.

POLICy IMPLICATIONS AND MARKET SIGNIFICANCE

Given the lack of dynamics on

THE INDONESIAN ECONOMy:

2009 Inflation rate at 3.04%

By Anton Gunawan

Dec-09* (forecast) Nov-09 Oct-09 Sep-09

Headline CPI (% chg y-o-y) 3.04 2.41 2.57 2.83

Headline CPI (% chg m-o-m) 0.57 -0.03 0.19 1.05

Headline CPI (% chg y-t-d) 3.04 2.45 2.48 2.28

Source: Bloomberg, *Danamon estimates

inflation, the BI rate is set to re-main at 6.50% in January, per-haps until the end of 1Q10 or early 2Q10. As it plans to bring down bank interest margins, BI still appears unsatisfied by the slow pace of credit growth—de-spite October data showing signs of improvement. Accordingly, BI’s monetary policy statement may not turn hawkish very soon.

Bank Indonesia’s plan to squeeze the interest margin of banks may lead to a continuing decline of bank lending rates, de-spite higher inflation expecta-tion.

In view of the political situa-tion, we see limited upside poten-tial for the rupiah to gain against the dollar in the immediate fu-ture. We maintain our YE09 forecast for the IDR at 9,600/US$, which then may weaken to-wards the end of 2010 towards 9,750/US$.

NOVEMBER TRADE DATA PREVIEW

Meanwhile, we expect the No-

Dec-09* (Forecast) Oct-09 Sep-09 Aug-09

Export Growth (% y-o-y) 12.6 10.1 -19.9 -15.4

Import Growth (% y-o-y) 1.2 -11.8 -24.2 -21.2

Trade Balance (US$bn) 1.69 2.42 1.27 0.84

Source: Bloomberg, *Danamon estimates

vember foreign trade data, also to be released early next year, to show a narrower trade surplus and back to a more normal lev-el after a surprising jump in Oc-tober. Exports and imports of oil & gas are expected to be slight-ly down despite relatively stable prices of oil.

Despite higher prices of key exports, commodity prices and non-oil & gas exports are expect-ed to be lower than that in Oc-tober, as there was no more cu-mulative reporting as in October. A more positive view of the eco-nomic prospects and increasing capacity utilization of manufac-turing industries may have sup-ported higher imports of non-oil & gas. We also expect that im-ports to stay robust following the appreciating trend of the IDR.

The writer is the Chief Economist at Treasury & Capital Markets PT Bank Danamon, Tbk.He can be reached at [email protected]

Generally, inflationary pressures are probably still out of sight as far as incoming data is concerned. Prices of some commodities such as gold and palm oil have increased lately, but the inflation impact should be somewhat counterbalanced by the strengthening of the rupiah in recent months.

Source: European Community, Eurostat 2009. Consultant’s calculation

FIGURE 1: EU EXPORTS TO, IMPORTS FROM, AND TRADE BALANCEWITH INDONESIA

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SECTORCRITERIA

Domestic Market Potential Regional Market Investment ClimateNegative list Indonesian Export Market

Construction Very high potential High potential restrictions

Machinery and Electronic High potential High potential restrictions High growth rate

Hotel and Restaurant High potential High potential restrictions

Textile Industry Low-Medium Potential Low potential restrictions Low growth rate

Transport andCommunication

Very high potential High interest restrictions Low growth rate

Chemical andPharmaceuticals

High potential Medium potential restrictions Medium growth rate (chemicals)

Food Industry Very high potential High potential restrictions High growth rate

Source: Consultant’s own formulation

TABLE 1: POSSIBLE INVESTMENT OPPORTUNITIES IN INDONESIA

In the years ahead Indonesia is set to become one of the main bases of the EU to maintain closer economic interactions with: that is a big opportunity as well as a challenge for the EU and Indonesia.

EducationThe President Post www.thepresidentpost.comDecember 25, 20096

N ow that the govern-ment has defended its decision to ad-minister the much-

debated National Examination, it has the responsibility to ensure a fairer distribution of facilities in order to establish better quality education on every level of study, educators say.

The first thing that the govern-ment needs to do after disburs-ing 20,000 more scholarships to schools across the country dur-ing its first 100-day in office is to provide more facilities to schools, especially those in the outer is-lands, and repair damaged facil-ities across the country.

Education analysts say that af-ter 64 years of independence, In-donesia is still gripped by the problem of discrepancies in the execution of education policies. For instance, schools on the is-land of Java are much better fa-cilitated than those in other is-lands.

Also, schools in cities are much better equipped and therefore are higher in quality than those in rural areas. Teachers are better paid in big cities than in remote places, not to mention the wide income gap separating the rich and the poor.

Even in urban areas, there seems to be some kind of discrim-ination between state-owned and private schools in that the former are usually the recipients of gov-ernment facilities and subsidies but the latter feel as if they have been treated like step-children.

T he government is rushing against time to disburse 20,000 more scholarships for

students from poor families to realize a promise President Susi-lo Bambang Yudhoyono made a year ago.

Vice President Boediono says these scholarships will be giv-en primarily to talented stu-dents from across the archipela-go whose families are unable to finance their education.

The President actually made the promise in August 2008 when he attended the second Asian Science Camp in the resort island of Bali.

He said then that the govern-ment would provide scholarships for Indonesian Science Olympic gold medalists to pursue a PhD degree while silver and bronze medalists will have the opportu-nity to obtain a Master’s degree either at home or abroad.

SBY had not been re-elected for a second term when he made the statement and he was not ac-tually aiming to use this as a po-litical gimmick.

The reality was that by then Indonesia had had many Sci-ence Olympic medalists who had not been given proper attention by the government. So the Pres-ident apparently saw the need to develop maximally the potential

SBY Government is Working Hard to Standardize National Education System

By Alci Tamesa

Critics have therefore said that the answer to this situation is not a nation-wide administering of national exams but improve-ment of facilities and upgrading of quality in every aspect of learn-ing.

Due to this, the government has reversed its orientation and is now working feverishly to im-prove the situation. For instance, the National Education Stan-dard Board and the Ministry of National Education have estab-lished eight standards for educa-tion to be implemented during the term of President Susilo Bam-bang Yudhoyono.

The eight standards are relat-ed to education facility, teachers and educators, graduate compe-tency, educational quality, educa-tional process, educational man-agement, educational financing, and evaluation.

Quality graduates can only come from quality schools and quality schools are the ones with quality teachers and sufficient

teaching-learning facilities. The government therefore is

being challenged by top educa-tors to prove its commitment by giving this issue a bigger atten-tion.

But given the fact that Indo-nesia is such a huge archipelago, the task of standardizing nation-al education may not be complet-ed fully during President SBY’s term of office. But the President has laid the right foundation for the purpose. This includes con-tinuous increase in the num-ber of scholarship recipients, im-provement of school facilities and so forth, observers say.

According to government sta-tistics, 52,65% of workers in In-donesia are elementary school graduates and dropouts. These are the segment of society that needs to be given vocational training, empowering them to have a better living.

Another painful reality the government is working to over-come is that only 32% of ele-mentary schools have a library. The ratio at junior high school is 63.3%. Meanwhile, almost half of the nearly 900,000 classrooms are damaged, according to Kom-pas.

Another challenge is the low quality of teachers. As of this year, according to official statis-tics, 88 percent of KG teachers are unqualified while on the ele-mentary school level the figure is 77.58 percent.

According to Prof. HAR Ti-

laar, senior educator at Jakarta State University (UNJ), the di-rection of education even at el-ementary school is not clear enough because students are be-ing taught through either a co-ercion or intimidation kind of method. This prevents self confi-dence from growing properly.

Worse, he theorizes, their tal-ents are not being developed prop-erly as they only follow whatever the school provides even against the need of developing their actu-al potentials.

Prof. Tilaar says that this is a serious problem the government

The first thing that the government needs to do after disbursing 20,000 more scholarships to schools across the country during its first 100-day in office is to provide more facilities to schools, especially those in the outer islands, and repair damaged facilities across the country.

Quality graduates can only come from quality

schools and quality schools are the ones with quality teachers

and sufficient teaching-learning facilities.

Thousands of Talented Students Receive Government Scholarships

of these young talents as nation-al assets.

But when Vice President Bo-ediono announced the scholar-ships on December 10, 2009, he made it appear that this was part of the realization of the new Cab-inet’s 100-day programs, which is usually understood as a demon-stration of the government’s seri-ousness in satisfying people’s as-pirations.

“We aim to disburse up to 20,000 scholarships during the first 100 days of our administra-tion,” the Vice President said dur-ing a meeting with Indonesia’s 2009 Science Olympic medalists at his office. That 100-day period began on October 20 when SBY installed his second Cabinet.

The government wants to make sure that there will be no more stories of talented Indone-sian students not being able to pay for their education only be-cause they are poor.

Due to this, the government has increased both the number of recipients and amount of scholar-ships from elementary school to university levels.

This is also part of the govern-ment’s anticipatory solution to-ward the impact of global eco-nomic crisis on poor families in Indonesia.

According to sources at the De-partment of Education and Cul-

ture, the government had actual-ly anticipated such circumstances long before it proposed the draft state budget for 2009.

That is the reason why the amount of scholarships for 2009-2010 academic year had been fixed at more than Rp3 trillion, according to Dr. Dodi Nandika, Secretary General of the Minis-try of National Education.

The number of scholarship re-cipients at elementary school level

was increased in 2009 to 2.2 mil-lion from 690,000. With this, the government hopes that there will be no more dropouts from poor families.

Throughout 2009, up to 841,000 more elementary stu-dents had dropped out for not being able to pay school fees, up to 28.1 million the total number of Indonesia’s elementary school dropouts in recent years.

The SBY government therefore

Over the past five years alone at least 7,250 students had been sent abroad on such overseas scholarships while the government has provided similar facilities for a total of 1,921 students.

aims to provide Rp 30,000 to ev-ery poor student per month. The fund is to cover their uniforms, books, pens, and transport ex-penses.

On the junior high school lev-el, the amount is Rp48,000 per month and up to 998,000 stu-dents will receive this facility. As of December 2009, the to-tal number of dropouts at junior high school level is 211,643.

Meanwhile, on the vocation-

First Lady Mrs Ani Yudhoyono strongly believes that education in the regions must be improved. Photo: www.presidenri.go.id

must handle quickly because oth-erwise as the students grow old-er, they will become unqualified individuals with an inferiority complex.

Meanwhile, Prof. Lydia Frey-ani Hawadi, lecturer of Psychol-ogy at the University of Indone-sia (UI), says that the education system in Indonesia has yet to develop students’ potentials—a task that must be given priority through proper government pol-icy.

She says that students cannot be taught in a random or gener-alized manner because they were born with uniquely different tal-

ents; the duty of educators is to develop these talents maximal-ly. Only then can Indonesia’s hu-man resources compete in the in-ternational arena, she theorizes.

In order to tackle such issues, the government is working to certify up to 2.8 million teachers through 2015.

As the government multi-plies effort to tackle these issues, a much bigger problem looms large—the issue of degradation of morality even among scholars and intellectuals. This is the rea-son why Indonesian prisons are inhabited also by scholars from

different fields of study.The issue of morality erosion is

so serious that there seems to be no way of handling it properly. For instance, pornography is al-ready a social malady haunting students at all levels, even at ele-mentary and junior high schools.

The mass media, especial-ly the electronic media such as television and the Internet have become a dangerous area from which negative influences are haunting the younger generation. This is an issue government min-istries have yet to handle proper-ly, educators say.

Vice President Boediono says these scholarships will be given primarily to talented students from

across the archipelago whose families are unable to finance their education.

By Alci Tamesa

al high school level, the num-ber of recipients will be increased by 200,000 to a total of 928,539 and the annual amount of schol-arship for every student will be Rp780,000. So the total fund of this category is Rp724 billion.

On the university level, the number of recipients has been increased by 70,000 to 240,000 students to be financed from a total allocation of Rp600 billion this year and as of 2010 the allo-cation will be raised to well over Rp1 trillion.

In a related development, edu-cation observers noted that inter-national agencies have, over the past five years, channeled in a to-tal equivalent of Rp4.2 trillion to finance Indonesian students pur-suing education abroad.

More than 60% of this was disbursed in the form of grant while the rest came in the form of soft loans.

Over the past five years alone at least 7,250 students had been sent abroad on such overseas scholar-ships while the government has provided similar facilities for a to-tal of 1,921 students.

The overseas scholarships came mainly from Australia, Germany, the USA, and the Netherlands.

Students take the scholarships mainly to pursue higher educa-tion in the fields of economics, accounting and trade, public pol-icy and governance, science and technology as well as education.

Among educators in Indone-sia, SBY is popularly known as a “pro-education President” be-cause of his total commitment to improving the quality of human resources through education. It is also during his term of office that the sector of education received 20% of the national budget.

The government has increased the number of recipients and amount of scholarships. Photo: www.presidenri.go.id


Technology

M uch is spoken about the ubiq-uitous growth of mobile phones

and its influence over econom-ic growth, yet little is discussed about the impact and influence of Internet Cafés (iCafés).

Known by many names in dif-ferent parts of the world — Gam-ing Centers, Cyber Café, Net iCafés, Internet parlors — cus-tomers are typically first-time us-ers and those who cannot afford a home personal computer (PC).

iCafés should not be overlooked by policymakers as they are an opportunity to provide low cost technology access in burgeon-ing emerging markets. Especially when one considers the fact that there are an estimated 13 million iCafés with around 207 million users in these markets, and that this number is expected to grow by more than 70 per cent over the next three years.

By Rajesh Soundararajan

Regional Shared Access Lead for Microsoft APAC

Compound this with the rap-id proliferation of broadband connections, lower communica-tion costs and the predominantly positive outlook toward comput-ers; these small iCafés are literal-ly bringing technology and inter-net access to thousands of people in emerging markets at a signifi-cantly lower cost than 1-to-1 PC access.

The pervasive nature of iCa-fés does come with challenges. Their image has assumed some

negative stereotyping. They are most often seen as nothing more than game centers or “hang-out joints”.

While it is easy to focus on the potential negative influence of iCafés on society, what is re-quired by government, academia and business alike in the realm of the iCafé is a holistic approach of cost-benefit to society.

One example of the construc-tive use of iCafés is what Sripha-tum University has done in Bang-

ICT Training in Philippines’ iCafésIn May this year Microsoft announced an agreement with Philippines-based iCafé operator Netopia to launch an innovative pilot program under the Microsoft Unlimited Potential umbrella. The pilot program brings new learning and training opportunities to people through Netopia’s 169 iCafés. It will provide access to software such as Microsoft Office 2007, in addition to digital literacy courses and free certifications through the Microsoft IT Academy Learning Portal, to help citizens gain the skills and education necessary to build or advance their careers.

“Our mission is to provide affordable access to information and communication to people without computers and the Internet. Now, with the digital literacy courses and certification from Microsoft, we are expanding our services and enabling new opportunities.”

George H. Tan, CEO, Netopia, the Philippines

Country2007 2010

iCafe users Internet users iCafe users Internet users

China 45.0M 189.4M 110M (^144%) 302M (^59%)

India 39.0M 98.9M 65M (^67%) 204M (^106%)

Brazil 21.0M 40.6M 29M (^39%) 56M (^38%)

Russia 3.8M 42.9M 5.7M (^50%) 64M (^49%)

Other EM* 98.0M 229.5M 140M (^43%) 294M (^28%)

EM Total 207M 601.3M 350M (^69%) 920M (^53%)

*Emerging Markets

Internet Cafés:Boon or

Bane?iCafés should not be overlooked by policymakers as they are an opportunity to provide low cost technology access in burgeoning emerging markets.

kok, Thailand. It joined with the True iCafé chain in the coun-try to provide eLearning services combined with Microsoft certifi-cation to their students, enabling them to be proficient in IT be-fore they attend university. This allows the university to improve the productivity of their students throughout the four years of their course of study. Rajesh Soundararajan can be reached at [email protected]

These small iCafés are literally bringing

technology and internet access to

thousands of people in emerging markets at a significantly lower cost than 1-to-1 PC access.

8EntrepreneurshipThe President Post www.thepresidentpost.comDecember 25, 20098

T hey stand tall, look smart and and ex-ude aplomb. Standing erect, the 16 proud

youngsters stand on a maksehift podium at a hangar that is the site of their graduation ceremo-ny at the Bali International Flight Academy (BIFA) last August.

On their shoulders – and those of their colleagues in the future – rest the future of the country’s aviation world: “the sky’s the lim-it.”

President & CEO Garuda In-donesia Emirsyah Satar, as well as his staff and local officials, con-sidered the occasion – and the flight school itself – so important that they took time to be present.

“BIFA is a milestone in the his-tory of our aviation world and I appreciate the initiative taken by its founders. Garuda Indonesia is sure to accept graduates of BIFA,” said Emirsjah.

The Transportation Ministry estimates that up to 2012 the In-donesian aviation industry needs at least 2.500 pilots. This is based on the assumption that there will be 250 planes coming in stages in the next four years. Each plane requires five pilots.

Flight schools in Indonesia can only produce about 140 pilots a year. The STPI in Curug, Ban-ten, which is managed by the Transportation Ministry, for ex-ample, can only produce 120 pi-lots per year as of 2008.

The high demand for pilots is due to the steep increase in air-craft in Indonesia in the coming years. Each year the number of aircraft passengers is expected to rise by about 25%.

On the other hand, many In-donesian pilots prefer to work overseas because of higher sal-aries. Sources say that this year alone about 350 pilots have gone overseas to seek a better income.

In addition to about 200 pilots that are now on contract with for-eign airliners, there are now some 500 Indonesian pilots manning foreign registered aircraft.

BIFA : A School That Provides JobsIn Buleleng, north of Bali, an international-class flight school is set to produce pilots that will determine the course and future of the country’s aviation world.

Text and photos by Taufik darusman

Garuda Indonesia alone needs 225 pilots between 2008 and 2010 – 2008 111 pilots, 2009 54 pilots and 2010 20 pilots – after factoring in the number of pilots that go into retirement and an es-timated 10% growth in the num-ber of planes.

‘’The job situation for pilots is good,’’ says Robby Djohan, chairman/founder /shareholder of BIFA.

“Imagine, in 1998 there were only six million passengers, a fig-ure that by the end of 2007 rose to 30 million. So Indonesia needs even more aircraft, which means more pilots and technicians,” he added.

“Garuda Indonesia alone this year requires 100 pilots as they are getting five new planes. Pri-vate airliners are also expanding their fleets. So far the short sup-plyof local pilots are made up by foreigners.’’

Robby acknowledged that tu-ition fees at BIFA is not exactly low (about US$55,000), but he pointed out that the salary of a pi-lot at present is no less than US$ 2000 a month.

‘’So the money will be re-couped in four to five years so long as they remain employed, maybe even sooner as pilots’ in-come is always rising,’’ he says.

BIFA operates in Buleleng, north of Bali, since the beginning of the year and is managd by pro-fessionals, among others former Garuda Indonesia top brass.

The academy’s facilities are close to excellent: a spacious boarding house and comfortable classrooms, pleasant and nutri-tious food, an expansive hangar

and (for the time being) five US-made Cessna trainer aircraft.

“Soon enough the number of trainer planes will reach ten,” says Robby.

“We employ professional in-structors from the US, Canada and Australia. In turn they will train Indonesian personnel to re-place them,” he added.

BIFA goes out of its way to make sure the students can also relax aftwr a grueling day of classes by providing a swimming pool and a tennis court. But what draws most visitors’ attention is an aircraft simulator that costs hundreds of thousands of dollars. The state-of-the-art equipment, which resembles a mini aircraft cockpit, allows students to train themselves and learn how to cope with any situation in the sky—without being airborne thou-sands of feet above the earth.

How did BIFA exactly came into being?

“About three years ago several former Garuda Indonesia senior executives came to me with the idea of setting up a flight school at the Letkol Wisnu Airfield, Buleleng, Bali,” Robby recalled.

“I was once the CEO of Gar-uda Indonesia and I understand well the problem of getting pi-lots. That’s why I promised them to look into the matter.”

Later on Robby convinced suc-cessful business people such as Edwin Soeryadjaya, Teddy Rah-mat, Benny Subianto, Tanri Abeng and Tience Sumartini to put their money in a flight school they agreed would be called the Bali International Flight Acade-my (BIFA).

“Total investment is US$2.5

million, including the construc-tion of a hangar and a boarding house plus four trainer aircraft,” says Robby.

As a former banker who start-ed his career in Citibank and later led Bank Niaga followed by Bank Mandiri, Robby is very well-versed in the numbers game.

“By my own reckoning the in-vestment will be recouped in no longer than four years,” he says.

But the return on investment in BIFA does not figure high in Robby’s mind. His personal wealth includes, among others, a five-star hotel in Legian, Bali, and several office buildings in Ja-karta.

“We see ourselves as educators. Education is music to my ears. We also conisder ourselves as providers of jobs. BIFA graduates will easily get jobs as the national aviation industry will continue to grow rapidly,” he said.

from top to bottom:

BIFA’s trainer planes are new and well-maintained; the simulator of

a Cessna aircraft; BIFA provides recreational facilities for its students;

pilot graduates pay tribute to their tutors; and BIFA founder Robby

Djohan (third from left) and Emirsyah Satar, (President & CEO of Garuda

Indonesia (fifth from left) pose with graduate pilots.

8 The President Postwww.thepresidentpost.com

Display until January 7, 2010 /// N0. 06 9BusinessPertamina gets partners to distributefuel oil in 2010

Downstream oil and gas regulatory agency (BPH Migas) has declared PT Aneka Kimia Raya Corporindo Tbk (AKR) and PT Petronas Niaga Indonesia as partner companies in the distribution of subsidized fuel oil in 2010.

A BPH Migas official, Jugi Prajogio, said here on Sunday that the decision was made at a BPH Migas committee meeting on December 23, 2009.

The fuel oil quota for the two companies amount to 129,602 kiloliters, of which AKR will distribute 109,162 kiloliters of diesel oil to 34 locations apart from public gas stations in Medan, Deli Serdang, Binjai, Metro, Central, East, South, North Lampung, Bandar Lampung, Pontianak and Banjarmasin, while Petronas will distribute 20,440 kiloliters of diesel oil to four gas stations in Medan, Antara reported

Government to develop condensate industry

The government will develop oil, gas and condensate industries in East Java and East Kalimantan, in a plan that forms part of the first 100 days program of the Industry Department.

“East Java produces condensate, but no industry uses it as yet,” said Director General of Agro and Chemical Industries of the Industry Department Benny Wahyudi on Tuesday.

The government, he continued, will push East Kalimantan to become a gas-based cluster area producing ammoniac, ethanol and urea as ammonium nitrate derivatives.

Bentoel, BAT to merge management

The shareholders of PT Bentoel Internasional Investama (Bentoel) and PT British American Tobacco (BAT) Indonesia have agreed to merge their management, according to Bentoel CEO Nicholas Tirtadinata recently.

The shares of BAT Indonesia will be replaced by that of Bentoel with a ratio of 7,68 Bentoel shares for every BAT Indonesia’s share.

According to Nicholas, the merger will be effective as of January 1, 2010, creating one of Indonesia’s most powerful cigarette companies as it will have a wider coverage of its product distribution.

The company plnas to control 8,2% of the national cigarette market, or about 260 billion of cigarettes per year.

Indofood`s net profit up 43%

PT Indofood`s net profit increased 42.34% to Rp1.58 trillion in the past nine months from Rp1.11 trillion over the same period last year, the

company`s Corporate Secretary Werianty Setiawan said in a press statement.While corporate sales dropped 5.7% to Rp28.20 trillion, its gross profit rose

by 3.5% to Rp7.76 trillion, thanks to the sales of its consumer branded products, which reached 43% of total consolidation sales.

In the same period in 2008, consumer brand product sales accounted for only 30% of total consolidated sales.

Russian investors to build resort in Bintan

Russian investors are set to develop a tourist resort in Bintan, Riau Islands Province, Mardhiah, head of the integrated Bintan district licensing and investment promotion body, told Antara last week.

“Russian investors are prepared to invest in this province as expressed in a meeting by Mr. Oleg Gurbulen, a Russian representative,” Mardhiah said.

Russian investors plan to build a tourist resort at a 55-hectare coastal area at Berakit village, Bintan District.

Construction work is expected to start late December 2009 or early January 2010.

BUSINESS BRIEFS

T o help spur growth in the business sec-tor, Home Af-fairs Minister

Gamawan Fauzi has revoked 206 bylaws which he deemed as double taxation.

He argued that the bylaws violated laws and other regula-tions that fall under higher le-gal grounds.

“I have revoked many by-laws since I became Home Affairs Minister. All of them are impeding the business sec-tor,” Fauzi said in Pekanbaru, Riau, last Sunday.

Fauzi said the business sec-tor such as the hotel or plan-tation sectors have been bur-dened by hundreds of bylaws.

“Businessmen have paid for building permits and hotel operation permits and yet still have to pay fees for other per-mits or retributions issued by local governments. These tax bylaws are extra burdens that businessmen have to bear and they are very cumbersome,”

T elecommunication operators are com-peting to provide BlackBerry servic-

es by targeting various market segments with attractive pack-ages.

Indonesia’s second big-gest telecom operator, Indos-at, for example, is launching BlackBerry Enterprise Servic-es (BES) On Demand, set-ting their sights at small and medium scale entrepreneurs (SME).

“BES on Demand is the first of a kind in the world. We provide this solution to re-spond to corporate customers’ needss for this service,” Indos-at Chief Marketing Officer Guntur Siboro said in Jakar-ta last week.

Indosat provides two op-tions for the BES on Demand service, namely BES on De-mand non-hosted and BES on Demand hosted.

BES on Demand non-host-ed is provided to customers who already have BES infra-structure but wish to use pre-paid cards like Mentari and IM3.

The BES on Demand host-ed service enables customers

Government Revokes Hundreds of Bylaws to Boost Business Sector

he said.Fauzi said the overlapping by-

laws have discouraged business people from investing in the country.

“We all know that Indone-sia is the country where it takes the longest time to process busi-ness permits. We have to fix this problem. Now, four other minis-ters have agreed to cut the time for investment permit issuance to 17 days,” said Fauzi.

He added that the govern-ment will impose stern measures on mayors or regents who do not comply with the new policy.

The government has appoint-ed the Supreme Audit Agency (BPK) to supervise the permit is-suance process.

“We will take stern measures should we find in the BPK au-dit result that regional heads are not complying with the decree. All regional heads must follow the decree about the investment permit issuance process, which is that it has to be ready in only 17 days,” he explained.

Five ministers, Home Affairs Minister Gamawan Fauzi, Jus-tice and Human Rights Min-ister Patrialis Akbar, Manpow-er Minister Muhaimin Iskandar and representatives of the Indus-try Ministry and the Capital In-vestment Coordinating Board (BKPM) had earlier signed a joint ministerial decree for accel-eration of business permit issu-ance on Wednesday in Jakarta at the Vice President’s Office.

Vice President Boediono said he was delighted with the break-through to cut red tape from 40 days to 17 days.

He said the decree would make it easier for foreigners to invest in the country. Boediono said that at 17 days, Indonesia is ahead of Thailand, where 30 days are re-quired to process an investment permit issuance.

“But Indonesia is still be-hind Singapore which can pro-vide permits in only three days and Malaysia 11 days.”

Boediono added that this was an important momentum to make Indonesia an investment target, adding that in the future the permit system will be done electronically so as to expedite the process.

Earlier, Industry Minister MS Hidayat said that in his 2010-2014 strategic work plan, the gov-

ernment vows to see all branch-es in the manufacturing sector to post positive growth.

This year the government has set a 1.84% growth target for the industry sector, but since the global economy is recover-ing from the crisis the govern-ment has set an optimistic indus-try growth target for the period 2010-2014 at 6.79% on average with 4.65% growth in 2010, 6.1% in 2011, 6.75% in 2012, 7.47% in 2013, and 8.95% in 2014.

The government has set 13.31% growth target for at least nine industry branches, name-ly food, beverages, tobacco this year, which are expected to grow 6.64% in 2010, 7.92% in 2011, 8.15% in 2012, 8.9% in 2013, and 10.4% in 2014 with average growth of 8.4%.

“From the growth target that we have set, we hope to provide jobs for about 3,224,275 people or an average of 644,855 people per year,” Hidayat said during a working meeting with House Commission VI last month.

He added that Rp735.95 tril-lion is needed between 2010 and 2014 or Rp147.191 trillion per year to achieve the growth target in the manufacturing industry.

Hidayat also expected the in-dustry to start moving to outside Java during the 2010-2014 peri-

od, from 75% in 2009 to 64.79% in 2014.

Gradually, the spread of indus-try in the Java island will further decline to 54.66% in 2020 and 47.65% by 2025, he said.

The government is also set to have the blueprint for industry revitalization ready by the end of the year. The Industry Ministry has included the sugar, fertilizer, and cement industries in its in-dustry revitalization plan.

The government also urges stock market investors to play a role in the industry sector through foreign direct investment.

Hidayat said his ministry has

included 45 sugar mills in the industry revitalization program which is dominated by state plan-tation company PTPN.

He added that he has coordi-nated with the Energy and Min-eral Resources Ministry, Direc-torate General of Oil and Gas, BP Migas to secure gas supplies, which often hamps the fertilizer industry.

“We must start the initiative. This is a joint program that needs support from many parties,” he said.

The ministry also included the cement industry in its agenda. The infrastructure acceleration program is expected smoothen distributions and logistics.

Home Affairs Minister Gamawan Fauzi has revoked 206 bylaws which he deemed as double taxation.

By Eka Putri

Operators Compete to Provide BlackBerry Service

to activate their BES service via SMS, a similar method offered by BlackBerry on Demand or re-tail BlackBerry service.

The BES service used to be available only to large corpora-tions with servers under specific specifications. But now custom-ers can access the service through Matrix, Mentari and IM3 cards without the hassle of preparing certain hardware and software.

“Companies also don’t need to have a server and can install ad-ditional device. They could sim-ply activate it via SMS,” Siboro pointed out.

Indosat has so far attracted 250,000 BlackBerry customers with 12,000 being BES custom-ers.

A new player in the telecom-munication scene, Axis, refuses to lag behind its older rivals In-dosat and Telkomsel by launch-ing an economic BlackBerry ser-vice dubbed BlackBerry Mail and Friends with a friendly tar-iffs starting from Rp3,000 per day, Rp20,000 per week and Rp55,000 per month.

Although similar to other eco-nomic packages, the service has its limits. The BlackBerry Mail package, for instance, only pro-vides email and instant messag-

ing services.The BlackBerry Friends pack-

age is provided for those who like to stay online but have a limited budget. The service is limited to only instant messaging and social networking sites with tariffs of Rp3,000 per day, Rp20,000 per week and Rp65,000 per month.

Meanwhile, in a bid to tap the lucrative BlackBerry mar-ket, handphone vendor ZTE launched the GC990 Qwer-ty phone and collaborated with Telkom Flexy to offer a complete package.

Telkom Flexi Executive Gener-al Manager Triana Mulyatsa ac-knowledged that the collabora-tion was made to accommodate the BlackBerry fever in the coun-try.

“That’s why we call it FlexiBer-ry,” Mulyatsa said at the launch of the phone on Friday last week.

GC990 is a dual SIM Card phone (GSM and CDMA) with the CDMA slot that can only be operated with a Flexi card.

The product is targeted at youths and is equipped with Windows Live Messenger, Ya-hoo Messenger, Facebook and Twitter application.

Most of the features in the phone are standard, but GC990

project chief Ni Fei promised that in the future it will integrate the phone with value-added servic-es such as digital music, gaming mobile online, and public ser-vices.

Despite the BlackBerry wave in the country, Canadian-based Research in Motion (RIM) said it still has no plan to open a representative office in In-donesia. Its products became a hit with sales soaring up to 500% compared to that of last year.

“We still don’t have any plan to appoint a Country Manager for Indonesia. Ev-erything is still under control from Singapore,” RIM Region-al Vice President RIM Asia Pacif-ic Gregory Wade told detikINET recently.

The number of BlackBer-ry users in Indonesia continues to grow rapidly. The services are provided by Indosat, XL Axiata, Telkomsel, Axis, and Smart Tele-com, with the number of users al-ready exceeding 500,000.

Meanwhile, Indosat said it has just finished upgrading its net-work capacity to boost access connection to its BlackBerry ser-vice.

The upgrade include increas-

ing the router inter-face capacity that connects In-dosat’s backbone with that of RIM’s.

“Our backbone is now 120 MB, but our router interface has been upgraded to 1 GB,” Siboro explained.

Siboro said upgrading the router interface was important to guarantee stability in BlackBerry data network especially amidst its rapid growth.

The services are provided by Indosat, XL Axiata, Telkomsel, Axis, and Smart Telecom, with the number of users already exceeding 500,000.

By Eka Putri

Phot

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The Bumi Waras (BM) Group is set to build a CPO (Crude Palm Oil) processing plant in Pino Raya sub district, South Bengku-lu District, Bengkulu Province.

The company would invest tens of billions of rupiahs for the CPO processing plant, according to Risman Sipayung, head of the Bengkulu provincial plantation service, here on Sunday.

The construction work of the CPO processing plant would be-gin early 2010, he told Antara.

The plant would need around 200 tons of CPO to be processed daily, he said.

There are a number of oil palm plantations around Pino Raya sub district which could supply the company with oil palm.

The factory is expected to pro-duce margarine and cooking oil,

The country’s largest toll road operator Jasa Marga ex-pects to collect slightly higher revenue this year as it predicts higher transaction volume from last year’s transaction at the end of the year.

CEO Frans Sunito said re-cently that in the third quarter Jasa Marga had earned Rp2.6 trillion with a net profit of Rp784 billion.

It aims to post Rp3.6 tril-lion in revenue and more than Rp800 billion in net profit at the end of the year, exceeding its 2008 revenue of Rp3.5 tril-lion.

The state company oper-ates 77% of all toll roads in the country and plans to build seven new roads three in Ja-karta, East Java (Gempol–Pa-suruan and Surabaya– Mo-jokerto), and Central Java (Semarang– Solo).

while its residue could be used to produce fodder and raw materials to make soap.

“Indonesia s CPO produc-tion in 2010 will increase by 1-1.5 million tons from this year s estimated figure of 20 million tons. The 2010 pre-diction is realistic, but it could even reach 2 million tons,” said Dorab E. Mistry of God-jred International Ltd.

Speaking at the “Indone-sia Palm Oil Conference and Outlook 2010,” Dorab said that the increase in Indonesia s CPO production would hap-pen because Indonesia has vast areas and is active in expand-ing plantations, particularly in 2007, that would boost its production next year.

Jasa Marga Aims for Higher Revenue This Year

Cipularang highway

Bumi Waras toBuild CPOProcessing Plantin BengkuluThe construction work of the CPO processing plant would begin early 2010.

BusinessThe President Post www.thepresidentpost.comDecember 25, 200910

By Eka Putri

I nvestments in the proper-ty sector next year may be rising as a result of stable economic condition and

low interest rates. “Compared to 2009, investments may be up by 10 percent,” Cushman Wakefield analyst, Andi Susanto Loe, said Jakarta yesterday.

The property sector is seen to be offering competitive benefits with rather stable profits.

The highest profit of 9-12% comes from the retail sector.

Profits from the residential sec-tor range from 7-9% while the of-fice sector gives 6-8% profit.

The increase is also taking place in the Asia Pacific, which is estimated to be growing more rapidly compared to Europe.

The Indonesian property mar-ket will be dominated by local in-vestors, especially those with ac-cess to funding and banking facilities.

Indonesian investors have also gone international, doing busi-ness in such countreis as the US and China as they believe the profits are higher compared to investing locally.

jAKARTA INVESTORS EyE PROPERTIES IN SOUTH SULAWESI

Meanwhile, Real Estate Indo-nesia (REI) has let it be known

Property Investments to Rise

that in 2010, Jakarta entrepre-neurs are set to invest in and de-velop several strategic housings in Makassar.

“Investment and property de-velopment in Jakarta and Java has reached a saturation point. Next year, property entrepreneurs will invest in East Indonesia area, es-pecially in Makassar,” said Dep-uty Chief of REI Djoko Slamet Utomo during a “Short Course on Small Scale Housing Devel-opment with BTN Financing” in Santika Hotel last week.

Djoko explained that East In-donesia, represented by South Sulawesi, is an area with a large potential in the housing sector.

The area, he said, still has huge potential to be developed as housing areas, adding that the housing sector development there is very alluring with its above av-erage regional revenue and eco-nomic development.

The greatest appeal is the avail-ability of green areas in Makas-sar, its suburbs and in the regions, which are already hard to find in Jakarta and in large cities in Java, he said.

“We see that there still are op-portunities to build housing near nature and people in Makassar and South Sulawesi,” he said.

The process of convert-ing into shares Garuda Indo-nesia’s debt of Rp1.19 trillion (US$125 million) in manda-tory convertible bonds (MCB) to Bank Mandiri is expected to be completed this year.

The conversion of the debt, not including interest, will make Bank Mandiri a 10.6% shareholder of the nation’s flag carrier, Abdul Rahman, a di-rector of the state bank, said.

Rahman said the govern-ment, as a Garuda sharehold-er, will take over the responsi-bility for settling the interest payment, he said.

Meanwhile, Garuda is set to resume Malang-Jakarta-Malang flights this month, following the repair and im-provement of the runway of Malang s Abdulrachman air-port, East Java.

“A decision to that effect is made on the basis of the re-sult of a verification of the fea-sibility and improvements on

Garuda Indonesia’s MCB Debt to be Converted into

Sharesthe runway by a team of the air transportation directorate gener-al and substantiated by the vali-dation of the supporting capaci-ty of the runway by a team of the transportation ministry,” Senior General Manager of PT Garu-da Indonesia for East Indonesia, Suranto, said in Surabaya recent-ly.

He said the airport can now by used again for take off and land-ing operations of its Boeing 737-300s, 737-400s, and 737-500s.

“The flights would be resumed on the occasion of Christmas and New Year,” he said.

The Malang-Jakarta-Malang flights will be carried out by Boe-ing 733-300s each with 16 busi-ness and 94 economy class seats, he said.

But, he added, for the time be-ing there will only be one daily fl-ghts at 1.30 p.m from Jakarta to Malang, and at 3.20 p.m from Malang to Jakarta, with each flight to last about 1 hour and 20 minutes.

The property sector is seen to be offering competitive benefits with rather stable profits. The highest profit of 9-12% comes from the retail sector.

South Sulawesi REI Deputy Head of Education and Training Haris Houdy said that eight big developers will invest in the re-gion next year.

He added that they will either invest directly or form a partner-ship with local entrepreneurs.

“The plan to invest in the housing sector, Haris said, will be profitable as it will speed up

housing procurement and in-crease competitiveness with local products,” he said.

“This is positive because it will help city development.”

He added that to face competi-tion in the property business, lo-cal entrepreneurs have to increase their capacity in all areas, because most of them still lack knowl-edge, education and ability to

open new areas. Two housing types will be de-

veloped in 2010, middle and low class landing houses and vertical houses.

Haris appealed to the govern-ment to provide stimuli for hous-ing development area in South Sulawesi, such as tax cuts which he said burden local developers.

Profits from the residential sector range from 7-9% Photo: Jababeka

“Investment and property development in Jakarta and Java has reached a saturation point. Next year, property entrepreneurs will invest in East Indonesia area, especially in Makassar,” said Deputy Chief of REI Djoko

Slamet Utomo

Photo: www.airliners.net

“The cut in fuel oil use will be one of the radical concepts Dahlan Iskan (the new PLN president director) has offered”.

Mustafa AbubakarState Enterprises Minister

Business


Sri Mulyani: Banks Key to Faster Pace in RI EconomyIf banks manage to maintain their soundness and channel credits up to more than 15 percent of the target for 2010, the economy would perform better next year.

By Eka Putri

F inance Minister Sri Mu-lyani Indrawati has said that banks play a key role in determining the

pace of the Indonesian economy.She also said the growth of

the economy in 2010 is subject to banks’ “soundness and their credit disbursement”.

“I believe the Indonesian econ-omy will perform better next year,” she said after taking part in a loan agreement signing event involving state electricity com-pany PT PLN and a number of banks here recently.

If banks manage to maintain their soundness and channel credits up to more than 15 per-cent of the target for 2010, the

economy would perform better next year, she said.

This year s inflation is possi-bly below 3%,Mulyani said, be-cause in terms of monetary stabil-ity what had happened in 2009 was “good”.

“From a stability point of view what happened in 2009 in terms of inflation, interest and rupiah exchange rates were all good. In 2009 the inflation rate will possi-bly reach below 3% with the rupi-ah appreciating in a performance that is the best in the world,” she said.

She added that in 2009 the in-flation rate in Indonesia was quite good and low.

“As such in 2010 it is expected

that inflation will remain low de-spite increasing inflationary pres-sures,” she said.

She said it was expected the rate of inflation in 2010 would be 5%, plus or minus 1%.

Coordinating Minister for the Economy Hatta Radjasa shared her view on the inflation rate this year, saying this year s inflation was expected to reach 3%.

“Inflation is expected to be 3% or somewhat below that figure,” he said.

The head of the Central Bu-reau of Statistics, Rusman Heri-awan, said he predicted this year s inflation would also be around 3%, as “prices of commodities are low.”

He said with the January-November annual inflation at 2.45%, inflation in the entire year of 2009 is expected to be around 3% “or a bit lower or higher than that.”

He added that inflation pres-sure in December was expected to come from the price of rice due to year-end seasonal factors.

Transportation sector is also expected to rise, he added.

He predicted that the price of chili, which had earlier become an inflation driver, will drop sharply this month.

“So based on the past two weeks of observation I think in-flation could be far below 1% be-cause the price of some commod-

ities such as red chili has dropped very sharply although the price of rice has risen a bit,” he said.

“We have however not yet tak-en into account the price of trans-portation which is rising ahead of Christmas holidays.”

The director of macro-plan-ning of the National Develop-ment Planning Agency, Bam-bang Prijambodo, also shared the view saying this year s inflation could be around 3%.

He said global price of vari-ous commodities is still quite low while the supply is “safe”.

“World demand is still not nor-mal and that the price of com-modities is still quite friendly,” he said. Finance Minister Sri Mulyani Indrawati Photo: www.matanews.com

The newly-installed manage-ment of state-owned electricity company PT PLN is to save up to Rp 15 trillion in expenditure by cutting fuel oil use by as much as 35%, a minister said.

“The cut in fuel oil use will be one of the radical concepts Dahl-an Iskan (the new PLN presi-dent director) has offered,” State Enterprises Minister Mustafa Abubakar said at a press confer-ence after inaugurating the new PLN board here on Wednesday, news media reported last week.

Mustafa said Dahlan has a con-cept to solve PLN s problems.

“The concept is good and rad-ical, and is about empowering PLN now and in the future,” he said.

He also said the concept of-fered new breakthroughs to erad-icate fuel subsidy for power gen-erating plants, to bring new technology and increase the use of gas and coal.

“Dahlan pledged to seek a new funding scheme to finance power plants and reduce the company’s huge debts,” he said.

New PLN Board to Cut Expenditures by Rp 15 trillion

By Eka Putri

Dahlan has a concept to solve PLN`s problems.

State-owned electricity company PT PLN is to save up to Rp 15 trillion in expenditure by cutting fuel oil use by as much as 35%

As reporters men at the con-ference questioned the capabili-ty of the former boss of Jawa Pos Group in improving PLN, Mus-tafa said the government would give him an opportunity to im-plement his concept well.

“There is no political con-tract. It needs to be appreciated and supported. We hope Dahl-an, who has a journalistic back-

ground, will be able to lead the company,” he said.

Human CapitalThe President Post www.thepresidentpost.comDecember 25, 200912

Naresh Makhijani Krishnan Rajendran james Creelman

T he global econom-ic meltdown that re-sulted from the so-called “credit crunch”

has forced many organizations to dramatically cut costs. Many business leaders have been quick to cut out all “unnecessary” dis-cretionary spend such as around people development (which as intangibles are expensed rather than capitalized) as well as mak-ing sometimes drastic headcount reduction.

Although saving money and boosting earnings in the short-term, there is a cost to re-hir-ing and re-training new employ-ees when the economy takes off again. Not to mention lost reve-nue if the company is unprepared

Indonesia Companies are Failing to“Manage Talent”

support our book was that just 3.85% of business leaders believe that HR organizations within In-donesia are playing a role in man-aging talent (Figure 1).

This is particularly worrisome because the evidence suggests that “talent management” will in-creasingly become more akin to a “war” than a simple HR manage-ment process - and for a number of key reasons.

The aging of the workforce (for •instance, the so-called post war baby boomers are reaching re-tirement age)Changing demographics and •altering attitudes toward work and work-life balance (for in-stance, the so-called “gener-ation y” – those people born after 1980 – are looking for a different work experience than their parents)Globalization and the com-•petition for talent around the world (as stocks dwindle talent is being sourced globally)Mismatched demand for and •supply of critical skills (there is simply not enough talent to go around) These pressures are converging

to create shortages, not always of bodies but of the right bodies to fill essential roles. smart compa-nies also recognize that when tal-ent walks out of the door they

are losing individuals with insti-tutional knowledge and critical business relationships.

Moreover, there is compel-ling evidence that those that in-vest in talent management reap considerable benefits - most im-portantly financial. In 2007 the US-headquartered strategic advi-sory and benchmarking firm The Hackett Group launched an in-depth study to determine wheth-er talent management strategies had a direct impact on financial results.

By using a sophisticated mod-elling approach, Hackett re-searchers identified and grouped those organizations from its glob-al database of about 3000 com-panies that could be described as top-performers in talent manage-ment. Hackett analyzed talent management performance ac-cording to four components:

Strategic workforce planning 1. (as examples, workforce gap as-sessment and leadership gap as-sessment).Staffing services (such as re-2. cruiting & staffing and exit process).Workforce development ser-3. vices (as examples learning & development and career plan-ning).Organizational effectiveness 4. (such as employee relations and

individual performance man-agement).

The researchers then compared the financial performance of the talent management top-perform-ers with the Fortune 500 com-panies. The findings were stun-ning. Those organizations that are talent management top per-formers significantly outperform the Fortune companies against financial metrics (Figure 2).

The size of the gap between top performers and the Fortune 500 companies strongly suggests that any cutbacks in talent man-agement might indeed cut short-term costs but will likely have a deleterious financial impact over the longer-term.

In addition to the financial benefits, top performing organi-zations also reported high scores for areas such as employee engage-ment (by analyzing performance across areas such as culture, work environment, management and leadership style, challenging work, performance feedback, fair rewards and growth opportuni-ties) and productivity (revenue per employee of $421 for the top performers versus $295 for the peer group).

Hackett’s findings point to a persuasive causal effect. Engaged employees are much more likely to provide that extra discretion-ary effort in their daily work; this in turn drives up productivity which positively impacts the fi-nancial results.

We find it useful to think of talent management according to five dimensions:

1Strategic workforce planning to identify the talent a company needs,

now and in the future; and to create an action plan to close the gaps

This is about identifying the key skills and competencies re-

quired by the organization to de-liver to its strategy. This requires HR to have a detailed under-standing of the strategy of the en-terprise and its business units and be able to identify those “strategic job families” (those that are the most critical for long-term suc-cess) that must be protected and nurtured.

2Attracting, recruiting, selecting, hiring, and on-boarding the

appropriate talent.HR must develop a firm grasp

of the key skills and competen-cies required by the organization and ensure that people with these requirements are in place.

3Creating the right skills and competencies through learning and

development efforts, then managing performance

When identifying the requisite strategic skills and competencies, HR must ensure that deliver-ing to these requirements is cen-tral to their learning and develop-ment efforts. HR must also make sure that the appropriate perfor-mance management system is in place so that the people with these skills and competencies are both expected to, and allowed to perform.

4Ensuring the necessary flow of talent through succession planning

and management (for high potentials and critical positions); engaging and retaining the workforce through initiatives that build an attractive environment, identifying a satisfying career, and providing meaningful rewards

Maintaining a well stocked “talent bench” is a crucial HR role. When this bench is emp-ty or occupied by below standard candidates the future of the enter-prise is compromised. But stock-

We define talent as: “someone who has

the required skills, competencies and

attributes to fulfill his or her present job

and who also clearly has the capabilities

to evolve into future roles (typically more

senior).

ing the “talent bench” requires that close attention is paid to cre-ating a workplace experience and environment that encourages tal-ent to stay with the organization. This has myriad dimensions: the cited learning and development aspect, cultural interventions and the creation of right apprais-al, compensation and reward sys-tems, as examples.

5Helping employees exit the workforce when the time comes for them

to move on either to another career or into retirement.

Like any process, there is a start and an end to talent man-agement. When it comes time for the employee to leave the organi-zation, the leaving process must be managed effectively. The use of exit interviews to determine why the employee is departing the organization and to gain an understanding of how they expe-rienced the organization is useful for making continuous improve-ments to HR practices and pol-icies.

Participants in OTI’s research study did not believe that HR or-ganizations are playing a role in managing talent within Indone-sia-based companies. However, these same business leaders rat-ed “to attract, maintain, develop and retain talent,” as the second most important role of HR (Fig-ure 3).

Clearly, business leaders are awake to the fact that the bat-tle for the best employees that is raging throughout the world has reached the Indonesian shores and that they are looking to their HR departments to deliver the talent solutions.

Giving the compelling finan-cial and other benefits available to those who effectively manage tal-ent, this can be decoded as noth-ing short of a “call to arms” for Indonesia’s HR organizations.

FIGURE 1: MANAGING TALENT IS NOT PRESENTLy A KEy ROLE FOR THE HR ORGANIzATION

30%

25%

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26.15%23.85%

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FIGURE 2: FINANCIAL PERFORMANCE OF TALENT MANAGEMENT TOP PERFORMERS VERSUS THE FORTUNE 500 COMPANIES.

Financial metric Talent Management top Performers Fortune 500 Annual impact on average Fortune

500 company*

EBITDA 16.2% 14.1% $399 million

Net profit margin 7.1% 5.8% $247 million

ROA 5.5% 3.7% $992 million

ROE 17.3% 13.6% $340 million

*Averages for Fortune 500: revenues = $19 billion, assets = $55.1 billion; equity = $9.2 billion

FIGURE 3: BUSINESS LEADERS RANK MANAGING TALENT AS THE SECOND MOST IMPORTANT ROLEOF HR ORGANIzATIONS IN INDONESIA

30%

25%

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9.39%

27.62%

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17.13%

6.63%8.29%

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3.87%

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to take advantage of new oppor-tunities.

But perhaps the most fright-ening consequence of these cut-backs will be that many orga-nizations will emerge from the downturn without the requisite talent to compete in increasing-ly global marketplaces – where the abilities of the employee base provide the greatest, and perhaps only, sustainable competitive ad-vantage.

In our book “Managing Hu-man Capital in Indonesia,” we define talent as: “someone who has the required skills, compe-tencies and attributes to fulfill his or her present job and who also clearly has the capabilities to evolve into future roles (typically more senior). Such people consis-tently deliver outstanding perfor-mance and are highly motivated. In short, their contribution is of value to the organization today and into the future.”

We would argue strongly that the managing of such talent (tal-ent management) should be a core concern of business leaders and a central focus of their Hu-man Resource (HR) functions in good times or bad.

Therefore, by some distance the most worrying statistic that emerged from a major research study that we commissioned to


Tourism

By Eka Putri

A n innovative, global campaign to help trav-el companies and des-tinations respond to

Climate Change, reduce their carbon footprint and move to the Green Economy, was launched early this month during the Co-penhagen Climate Summit.

Announcing the new initiative, called “Live the Deal”, long time tourism green campaigner Geof-frey Lipman UNWTO Assistant Secretary-General said: “What Copenhagen represents is a new commitment by the world com-munity towards sustainable low carbon growth patterns. The tar-gets and mitigation actions that countries develop and negoti-ate through this process will be a new base for travel industry ac-tion. What we are providing is a very simple way to get behind the evolving government initiatives, to keep pace with changing pat-terns and to demonstrate that our sector is acting, not simply talk-ing.”

He added ”We should not be

“Live the Deal”Set to Respond to Climate Change

ashamed to promote the growth of smart travel – clean green, eth-ical and quality - it’s the lifeblood of trade, commerce and human connection”.

“Live the Deal” follows the pattern established in the UN led Copenhagen Seal the Deal cam-paign by its single minded focus, its simplicity and its broad based engagement goals.

It will seek to encourage the sector directly and through rep-resentative organizations.

It has been developed with the support of UNWTO, whose Sec-retary-General Taleb Rifai calls it “The kind of link between glob-al policymaking and responsible tourism action that we are look-ing to inspire and encourage.”

“Our sector fuels the econo-my, creates jobs and is one of the biggest development opportuni-ties for the world’s poorest coun-tries – and it can be a leader in the transformation to a green econo-my”.

The campaign will be under-pinned by a simple carbon calcu-

lation tool that allows easy cor-relation with government targets and implementation measures, as well as a Think Tank and Annual Innovations & Investment Sum-mit.

The inaugural Summit will be in Abu Dhabi in the last quarter of the year. Live the Deal will be promoted by a multimedia vid-eo “We can take this Climate Change” from platinum album writer and singer Alston Koch which will be profiled around the world in 2010 (See animated vid-eo on www.UNWTO.org).

Meanwhile, the United Na-tions World Tourism Orga-nization (UNWTO) and the World Travel & Tourism Coun-cil (WTTC) this month released a joint communique saying that Travel & Tourism is one of the largest industries in the world providing a strong impetus to global economic development.

In 2009, the Travel & Tour-ism Economy is expected to ac-count for 9.3% of global GDP

About UNWTOThe World Tourism Organization (UNWTO), a United

Nations specialized agency, is the leading international organization with the decisive and central role in world tourism.

It serves as a global forum for tourism policy issues and a practical source of tourism know-how. Its membership includes 154 countries, seven territories and more than 400 Affiliate Members representing local government, tourism associations and private enterprise.

About WTTCThe World Travel & Tourism Council (WTTC) is the

business leaders’ forum for the Travel & Tourism industry, working with governments and other stakeholders to raise awareness of the importance of one of the world’s largest generators of wealth and employment. With Chairs and Chief Executives of the world’s 100 foremost Travel & Tourism companies as its Members, WTTC has a unique mandate and overview on all matters related to Travel & Tourism.

and to generate over 210 million jobs, or 7.4% of global employ-ment. In 2008, 922 million in-ternational tourist arrivals were recorded, contributing US$944 billion in international tourism receipts. The industry has of-ten acted ahead of regulation to adopt and disseminate standards and best practices on greenhouse gas (GHG) mitigation and adap-tation.

jOINT COMMUNIqUé FROM UNWTO AND THE WORLD TRAVEL & TOURISM COUNCIL (WTTC)

The sustainability of the Trav-el & Tourism industry and that of the environment are mutually dependent. Using its role as an in-ternational conduit for peace and prosperity, the industry is actively engaged in the protection of frag-ile ecosystems and indigenous communities and contributes to-wards the successful advance-ment of the UN Millennium Development Goals, especial-ly poverty alleviation in develop-

“Live the Deal” campaign was launched early this month during the Copenhagen Climate Summit.

ing countries. Travel & Tourism’s far-reaching benefits position it as a leading player in a strong, unit-ed, global effort at combating cli-mate change.

The World Travel & Tour-ism Council (WTTC) and the World Tourism Organization (UNWTO) are, respectively, the leading private and public sector entities within Travel & Tour-ism. WTTC is the business lead-ers’ forum for 100 of the foremost Travel & Tourism industry com-panies while UNWTO is a spe-cialised UN agency, with a mem-bership of over 150 countries and some 400 private and pub-lic tourism stakeholders. Work-ing together, the two world bod-ies are aligning efforts to unify a fragmented Travel & Tour-ism industry, speaking with one voice on the critical issue of cli-mate change.

In order to show their commit-ment both organisations joint-ly hosted a side event during the COP-15 negotiations: Address-ing the Challenges of Climate Change – Perspectives from the Travel & Tourism Sector.

The event highlighted inno-vators from the private and pub-lic sector from across the world and all sectors of the industry. Under the leadership of WTTC and UNWTO examples of best practice were presented in order to communicate to policy-mak-ers and the rest of the industry Travel & Tourism’s proactive ap-proach to carbon emissions’ miti-gation and adaptation.

A sound framework is critical for the Travel & Tourism indus-try to give companies the trans-

parency necessary to make in-formed investment decisions, many of which can strongly in-fluence a nation’s economic de-velopment.

The Copenhagen Agreement provides a unique opportunity to set the foundation upon which a resilient green economy can be developed.

“UNWTO’s Davos Declara-tion Process on climate change response paved the way to po-sition the tourism industry as a relevant player of global climate neutrality,” said UNWTO Sec-retary-General ad interim Taleb Rifai.

“Joining forces for tourism to speak as one in Copenhagen re-sponds furthermore to a key rec-ommendation of the UNWTO Roadmap for Recovery, high-lighting the importance of build-ing a strong public-private di-alogue and boosting strong partnerships. The great cross-cutting impact of our industry makes it necessary to establish and maintain this close collabo-ration,” he added, “and I am con-fident that together we will con-tribute to a better positioning of travel and tourism in the global climate response agenda.”

Public and private sector part-nership in this issue is essential.

“The Travel & Tourism in-dustry urges global leaders in the

wake of the Copenhagen Agree-ment – regardless of its final form – to actively engage the private sector in translating the interna-tionally agreed framework into transparent, supportive and pro-gressive national and regional policies,” Jean-Claude Baumgar-ten, WTTC President & CEO, stressed.

“The Travel & Tourism pri-vate sector has always sought a deeper working relationship with governments, and the anticipat-ed Copenhagen Agreement will provide an excellent opportuni-ty to further develop this rela-tionship.”

The Travel & Tourism indus-try has in the past developed, and will continue to develop, sus-tainable solutions, which will as-sist the industry to be at the fore-front of efforts to combat climate change, and will play a much needed role in terms of exchange of innovative technology to ad-vance carbon emissions’ reduc-tion. Incentives and policies, as well as global sectoral approach-es, supported by a ‘level playing field’ void of restrictions to trade, will allow the industry to effi-ciently pursue the scale of change for progressive transformation to occur. Only then can the true potential of the industry be un-locked.

(UNWTO)

The Travel & Tourism industry has in the past developed, and will continue to develop, sustainable solutions, which will assist the industry to be at the forefront of efforts to combat climate change

The campaign will be underpinned by a simple carbon calculation tool that allows easy correlation with government targets and implementation measures, as well as a Think Tank and Annual Innovations & Investment Summit.

TravelThe President Post www.thepresidentpost.comDecember 25, 200914

S anur is not exactly Ba-li’s best-kept secret. Af-ter all, it was precisely the village’s exotic appeal

that attracted tourists the world over to the island and sparked its tourism growth in the early 1970s. The island is now a peren-nial winner of major travel mag-azines’ much-coveted ‘the world’s most favorite resort’ title.

Rock stars Mick Jagger and David Bowie always make it their point to spend time in Sanur to re-charge their batteries after do-ing exhausting concerts in Aus-tralia. Celebrities such as Sarah Ferguson and Sophia Loren have put Sanur in their list of must-vis-it places (maybe now no longer, but certainly during their happi-er days).

And when years ago Dewi Soekarno, to the delight of incor-rigible voyeurs, decided to bare her natural assets -- albeit some-what depreciated -- in a coffee-table book, it was said that she would settle for no less than Sa-nur as the site for the steamy pho-to session.

“Sanur stands out among oth-er areas in Bali for its wide ap-peal that caters to a wide spec-trum of visitors,” said Ida Bagus Ngurah Wijaya, the chairman of the Denpasar-based Bali Tour-ism Board (BTB) and owner of the Segara Village cottages, told this magazine recently.

He added: “Here you’ll find sandy beaches, spectacular sun-rises, a golf course, a shopping center, art galleries, a five-star ho-tel and beachfront villas. The cu-linary scene is also picking up pace, with new eateries opening at a steady rhythm.”

“No village in Bali can boast such a wide range of facilities, in-cluding international schools due to its sizable foreign community. At present, we’re in the opening of spas mode.”

In many ways, with its irre-sistible drawing power of sun, sand, spa and (a little bit of dis-crete) sex, Sanur defines Bali. But there is more to Sanur than that. The aura of old money and new money is in the air, an interesting combination that takes shape in Jalan Danau Tamblingan, a tree-lined street dotted with villa ho-tels, chic boutiques, fine-din-ing restaurants and art galleries, many of which owned by for-eigners with locals as their fronts.

On Saturday evenings, the place to be for good, reasonably-priced food and good, reason-ably-performed music is Cafe Batujimbar on that very same street.

Says BTB’s Wijaya: “Our pro-motional drive also focuses on the so-called ‘silver market’, ba-by-boomers who have retired and have discretionary income and free time to spend outside their countries. So far we have been able to attract large numbers of retirees from Holland, who come here to stay for up to six months as they enjoy special rates.”

But no matter where they come from and spend their time in Sa-nur, they all share a common de-sire to visit the Le Mayeur Mu-seum, the former house-studio of the famous Belgian impressionist painter of aristocratic stock who came to Bali in 1932 and stayed there for almost three decades. The museum displays parts of his large body of work in sever-al rooms, whose upkeep leaves much to be desired. But what the

Text and Photos by Taufik darusman

A vibrant village in the 1970s, Sanur in southern Bali retreated to the background as the island’s upscale Nusa Dua, cozy Legian, artistic Ubud and elegant Seminyak took center stage.

It has, however, in recent times reclaimed its rightful place among its peers on the back of its intrinsic time-honored allure.

museum lacks in good mainte-nance it makes up in historical original paintings that never fail to amaze even the uninitiated.

“In presenting Sanur to the world, we try to combine tourism and art,” says Ida Bagus Sidhar-ta Putra, owner of the chic Griya Santrian Hotel & Resort.

Putra, who is also an art pa-tron—he is the chairman of the Himpunan Pelukis Sanur, an as-sociation of Sanur painters—ac-tively promotes Sanur by holding an annual event that features the Sanur’s dynamic art, culture and cuisine.

“Sanur comprises seven small districts that are seamless-ly bound by a common inter-est, that is to preserve its cultur-al heritage in ways that allow us to come to terms with modern-ization,” he said.

The atmosphere from sunrise till sunset in Sanur is of endless opportunities to discover how Balinese, who are blessed with a strong artistic flair, conduct their life. This explains the high num-ber of art galleries you’ll find in many parts of Sanur.

Sanur was the site of Bali’s first modern hotel, then called Bali Beach, which suffered in 1992 a fire that destroyed a major part of the hotel. One room was myste-riously untouched, however, and the Balinese have dedicated that room as a shrine, never to be oc-cupied. In the late 1970s the BaIi Hyatt took center stage amidst a boom in the island’s tourism.

In the course of time new mod-est but comfortable hotels and villas sprung up along the coast, attracting more and more tourists not only to stay but stay for an ex-tended period of time.

The atmosphere here is laid back, which is probably the main reason why it’s popular with the above 50 crowd. On any given day a stroll along beachside path that binds Sanur’s main hotels and villas, you are likely to come

across long-staying foreign tour-ists enjoying their retirement peri-od. Hotel owners say many Euro-pean baby-boomers would spend months in Sanur to avoid the cold harsh winter back home.

Sanur also offers moderate waves that surfers and people with young kids find ideal. But its nightlife is basically confined to bars, pubs and restaurants that, however, provide respect-able live music.

In deference to globalization fast-food joints such as McDon-ald’s and KFC are on hand. In recent times, however, Italian eateries have made their way to Sanur, one of which is The Vil-lage, which lies on the main road. It has a unique wine cellar and is open daily up to midnight.

Another pleasant aspect of Sa-nur is its wide beach front. A footpath of square stones covers the entire distance from the Gri-ya Santrian to the Grand Inna Hotel and beyond, leading to the Le Mayeur Museum. This al-lows visitors to stroll along or stop when they feel like it for a drink or snack at a beach side restau-rant. Or, for that matter, just oc-cupy one of the beach chairs ly-ing around and reminisce the good times in the past and at the same time hope for even better times in the future.

HOW TO GET TO SANURGaruda Indonesia flies the Ja-

karta-Denpasar route 59 times in a week.

It takes 25-30 minutes by car to get to Sanur from Ngurah Rai International Airport, subject to the density of traffic due to Bali’s rapid economic dcevelopment.

RECOMMENDED PLACES TO STAySanur Beach Hotel, Griya

Santrian, Segara Village Hotel, Bali Beach Hotel

Reprinted by permission from Garuda Inflight Magazine

SunnySanur


Health

Photo: www.wikivisual.com

P eople with normal lev-els of LDL (bad) cho-lesterol still need to be screened for a marker

of inflammation in order to iden-tify those who may benefit from cholesterol-lowering statin thera-py to reduce their long-term risk of heart attack, stroke and death, say U.S. researchers.

“This study builds on results from the landmark JUPITER trail, which showed that statins can prevent heart disease in peo-ple with normal LDL-c, or bad cholesterol, and an increased lev-el of CRP,” study co-author Dr. Christie Ballantyne, director of the Center for Cardiovascular Disease Prevention at the Meth-odist DeBakey Heart & Vascu-lar Center in Houston, said in a news release.

C-reactive protein (CRP) is a blood-borne marker of inflam-mation that has long been linked to cardiovascular risk.

Questions regarding the use-fulness of CRP measurements remained after the results of the JUPITER trial, which was stopped at two years median pa-tient follow-up, were released in 2008. One major question was whether observed cardiovascular disease event rates would persist with time.

“The new study analyzed pa-tients’ risk over an average of sev-en years to determine that CRP is, in fact, a long-term indicator of cardiovascular risk. This is im-portant because approximate-ly one in five men over 50 and women over 60 has a similar pro-file of increased CRP but normal LDL,” Ballantyne said.

The researchers demonstrat-ed that a simple screening test — age plus CRP — can identi-fy patients who may benefit from statin drugs.

The study was published Dec. 11 online in the Journal of the American College of Cardiology.

Which Statin Will Lower Your Cholesterol?

Lipitor (atorvastatin), Zocor (simvastatin), Crestor (rosuvas-tatin), and other statins can dra-matically lower levels of artery-clogging cholesterol in the blood, an ability that makes them huge-ly popular in our cholesterol-rich country. Heart researchers have estimated that these drugs could save 1,000 lives each week for ev-ery 10 million high-risk heart dis-

ease patients who take them. One study of nearly 20,000 pa-

tients found that, after a heart at-tack, taking a statin can prevent the risk of death within one year by 25%. Among patients who don’t even have cardiovascular disease, taking a statin preven-tively can reduce the risk of a ma-jor coronary event like heart at-tack by about 30%.

When Denise Foley, 57, of Philadelphia, went through menopause, her cholesterol shot up from 160 to 240. Her doc-tor warned her that that number, along with her family history of heart disease, put her at risk for a heart attack or stroke. But she didn’t want to take heart medi-cation.

“I really wanted to lower my risk without drugs,” she says.

Seven years ago she was pre-scribed Lipitor to control her high cholesterol. Soon after, she start-ed feeling depressed for no rea-son.

“I went to a party filled with good friends, and I sat in the cor-ner and thought everyone hated me,” she says.

Turns out depression can be a side effect of Lipitor. Her doctor switched her to Zocor, which she now takes successfully. Her cho-lesterol is in a safe range.

“I worry about the long-term effects of these drugs,” she says.

“But I also know that without medication, I might be dead from a heart attack or stroke.”

Statins May Worsen Heart Failure for Some

Since statins can cause mus-cle damage, they could theoreti-cally also harm the heart—which

is, essentially, a big muscle—al-though there is no evidence that this is the case. To investigate whether the drugs might affect the heart and other muscles in heart failure patients, Dr. Mike Cahalin and his colleagues ana-lyzed data on lung function and exercise tolerance in 136 patients, 61 of whom were taking statins.

Overall, the patients taking sta-tins had worse lung function and exercise tolerance than those who weren’t taking the drugs.

But when Cahalin and his team analyzed patients with the two different types of heart fail-ure—systolic and diastolic—separately, they found the drugs seemed to help those with the systolic version, and hurt those with diastolic heart failure.

He speculated that the anti-in-flammatory effect of the statins could be helping systolic heart failure patients, while their mus-cle-weakening effects might im-pair breathing in those with di-astolic heart failure.

A major problem with the study, notes Dr. Horwich, is that there were a number of fac-tors that could have contributed to the findings; for example, it’s not clear from the study why doc-tors chose to put some patients, but not others, on statins. Systol-ic heart failure patients may have seen more benefits because they were more likely to have coronary artery disease, she adds.

“I think it’s definitely possible that statins may not be helpful in diastolic heart failure,” Dr. Hor-wich says.

She notes that the impor-tance of diastolic heart failure has only become clear relatively re-cently. Although doctors have a good handle on how to help pa-tients with systolic heart failure, she explains, there really aren’t

any treatments that are known to help patients with diastolic heart failure.

According to Cahalin, it could make sense to do a simple lung function test on heart failure pa-tients before prescribing statins. That way, he says, it would be easy to tell if their lung function got worse while they were on the

drugs.And if someone with diastol-

ic heart failure is prescribed the drug and his or her heart fail-ure symptoms—such as weak-ness, fatigue, and shortness of breath—get worse, he adds, “that should be investigated.”

(health.com)

“Nanosensors,” a blood-based technology, can spot early signs of cancer, according to a new study.

By taking everyday blood sam-ples from patients, the device can lead to quicker detection and treatment, said the study, whose findings were published online Dec. 13 in the journal Nature Nan-otechnology.

The sensors were developed by researchers at the Yale Institute for Nanoscience and Quantum Engi-neering in New Haven, Conn.

The device hunted for and picked up biomarkers for prostate and breast cancers, according to study co-author Mark Reed, asso-ciate director at the institute.

The technology “can generally be applied to many other types of biomarkers,” said Reed.

“The real achievement here was demonstrating this with blood, which was a longstanding goal,” Reed explained.

“It could not be done before be-cause blood has too much salt and other stuff in it, which prevents this type of sensing. We developed a method to filtrate out specifically what we want to detect.”

Only small amounts of blood

“Nanosensors” Detect Early Signs

of Cancerwere needed and the process took all of 20 minutes, according to Reed.

“From a personalized medicine point of view, you could take a spot of blood from a finger prick and get results within minutes,” said William C. Phelps, program direc-tor of Translational and Preclinical Cancer Research at the American Cancer Society.

“It would be simple, stable and relatively inexpensive,” he said.

“There`s a crying need for things

like this in lung cancer, where you would want to be able to detect biomarkers in a sputum sample, and pancreatic and ovarian can-cer,” Phelps said.

“You can`t really detect these early, so they`re very hard to treat,” he noted.

Although the technology has yet to make it to the doctor`s of-fice, it is revolutionary in more than one way, experts say.

Previous technologies work in much the same way, but can only detect biomarkers in purified solu-tions, not the real thing -- meaning fluid samples from patients.

(Xinhua-OANA)

Chinese scientists have recently said that China`s ongoing under-sea probe of a sulfide deposit could help produce new medi-cines by studying the submarine hydrothermal organisms.

China`s home-made underwa-ter robot “Hailong 2” grasped 7 kilograms of sulfide in a deep-sea hydrothermal “chimney” vent 2,700 meters below the sea`s surface near the equator in the eastern Pacific on Oct. 23. It may contain many deep-sea microbes widely regarded by scientists as the planet`s original life forms.

Ma Weilin, one of the chief sci-entists on the Dayang 1 Scientific Investigation Ship, told Xinhua the organisms living in an extremely high pressure environment suf-fused with poisonous sulfide were

CHINESE SCIENTISTS:

Undersea Probe MayHelp Produce NewMedicines

worthy of study in developing gene-based medicines.

Hydrothermal solution is pro-duced by hot magmatic emana-tions in deep water, around which many hydrothermal organisms survive by chemical combination.

Wang Chunsheng, marine ecologist of the Institute of Ocean-ography under the State Oceanic Administration, said, “The hydro-thermal organisms have the po-tential to help the development of new anti-toxin drugs.”

They live in an aphotic depths of the sea, an environment quite similar to the very early stages of the earth when living things came into being, Wang said.

(Xinhua/OANA)

People with normal levels of LDL (bad) cholesterol still need to be screened for a marker of inflammation

One study of nearly 20,000 patients found that, after a heart attack, taking a statin can prevent the risk of death within one year by 25%.

“Photo: www.wellnesstaskforce.org

Normal Cholesterol Doesn’t Guarantee Healthy Heart

LifestyleThe President Post www.thepresidentpost.comDecember 25, 200916

The President PostOFFICEMenara Batavia 25th Fl. Jl. K.H. Mas Mansyur Kav. 126Jakarta 10220, IndonesiaPhone : (021) 572 7337Fax : (021) 572 7338Email : [email protected] : www.thepresidentpost.com

PUBLISHED ByYayasan President University

CEO & EDITOR IN CHIEFAli Basyah Suryo

CONTRIBUTORSAtmono SuryoCyrillus Harinowo HadiwerdoyoNaresh MakhijaniTaufik DarusmanThomas W. ShreveWuryastuti SunarioVidya Dahlan

EDITORIAL & ADVERTISING/CIRCULATION DEPARTMENTSCory Margaretha

LAyOUT & DESIGNMohamad Akmal

T he latest research con-ducted by independent market analyst Data-monitor found that

more than three-quarters of Aus-tralians are placing greater im-portance on maintaining or im-proving their health. A similar proportion (71%) of Australians reported that they ‘make con-scious attempts to eat healthily’ either ‘all’ or ‘most of the time’.

Katrina Diamonon, Consumer Markets Analyst, noted that this mindset even applies to our alco-hol purchases. Indeed, more than a quarter of Australian drinkers make choices with health consid-erations in mind.

Looking at the number of low-carb brews on offer nowadays, it is evident that not even our be-loved beer is immune from rising health consciousness.

How Aussies Planto Get Healthyin 2010

Clearly, Australians are put-ting in a genuine effort to make more informed choices, and in the coming year, this effort will manifest itself in a growing at-tentiveness to the nutrient pro-file and ingredient composition of foods.

As health conscious Austra-lians show a greater interest in what goes into their food, and ul-timately their bodies, the most important labels around will be those in the supermarket.

Indeed, nutritional labeling has emerged to become a hot topic in food and beverage marketing, not just in Australia but globally.

Nearly half (48%) of Austra-lians report that they routine-ly rely on nutritional informa-tion on product packaging to help make food and drink choic-es, compared to a global average

of 44%. “This attentiveness puts addi-

tional pressure on food and bev-erage manufacturers to respond via effective product reformula-tion that is communicated in an engaging, believable manner,” comments Diamonon.

But what information in par-ticular are these label-conscious Australians looking for?

Growing industry and media attention surrounding niche fol-lowings such as soy-rich and glu-ten-free diets would suggest that this is the new craze. Yet Data-monitor found it is still the tradi-tional ‘dietary evils’ that preoccu-py Australians’ choices.

Nearly half (46%) of Austra-lian consumers deem ‘low sugar or no added sugar’ claims to exert considerable influence on their

product choices, while 44% per-ceive the same about ‘low or re-duced fat’.

Diamonon noted, “the impli-cation is that, while newer health considerations offer considerable future potential, they are not yet mass market considerations. Mar-keters must therefore adopt tem-pered expectations when it comes to using the newest ‘vogue ingre-dients’ in health-driven product reformulation.”

Indicative of rising knowledge about the link between diet and

H oliday plane travel is rarely hassle- free. Packed airports, de-layed (or canceled)

flights, and lost luggage can send even the most stable of travelers into an emotional tailspin.

But for people who struggle with insomnia, flying can pres-ent additional problems. The disruption to normal schedules caused by flying—and especial-ly jet lag—can wreak havoc on sleep patterns.

If you’re traveling between time zones this season, try these tips. Though they won’t work for everyone, they just may keep you from yawning your way through the holidays

Melatonin--a natural hormone also sold as a supplement that reg-ulates the body’s sleep-wake cy-cle. Levels rise after dark, peak overnight, and then fall in the morning. In some studies, tak-ing melatonin has been shown to help fight jet lag.

Experts recommend taking melatonin after dark on the day that you travel, and for a few days thereafter. For people flying east, some experts recommend taking melatonin in the evening (at 6 or 7 p.m., say) for a few days before your flight.

Melatonin can interact with medications, and if taken incor-rectly can actually disrupt sleep,

Tips for BeatingHoliday Jet Lag

so be sure to consult your doctor before trying it.

Lavender oil—(also known as lavender essential oil) is a proven sleep enhancer. In a small 2005 study conducted by psychologists at Wesleyan University, in Mid-dletown, Conn., lavender was shown to act as a mild sedative, promoting deep sleep and leav-ing the people who took it feeling more refreshed the next day.

Pycnogenol—a dietary supple-ment—a trademarked extract of the bark of French pine trees—reduced jet lag symptoms in a small 2008 study conducted in Italy.

People who took 50 milligrams of Pycnogenol three times a day for a week, starting two days be-fore their flight, had substantial-ly fewer symptoms (including fatigue, insomnia, and mental slowness) than people who took a placebo. And what symptoms the people in the Pycnogenol group did experience lasted just 18 hours on average, compared to 39 hours in the placebo group.

As with any supplement, you should consult your doctor be-fore trying Pycnogenol.

PRESCRIPTION SLEEP MEDICATIONS

Carlos Schenck, MD, a sleep expert at the Minnesota Region-al Sleep Disorders Center and

the author of Sleep: The Myster-ies, The Problems, and The So-lutions, says that short-acting sleep medications such as Sonata or Ambien can be helpful when traveling west to east (especially on transatlantic flights).

When flying in the opposite direction, longer-lasting pills such as Lunesta or Ambien CR tend to work better, he says.

You should never take these drugs without a prescription, and they shouldn’t be mixed with al-cohol. Adds Dr. Schenck, “Never take any sleeping pill for the first time on a plane; get used to it at home first.”

SOAK UP THE SUN When flying west to east,

you’re likely to feel sleepy on the day after your arrival. Getting as much sleep as possible the night before will help, and so will get-ting some sun. “To keep awake, get bright light early in the day by turning on a bright lamp or tak-ing a walk in the sunshine,” says Dr. Schenck. And avoid naps, he adds, because they tend to pro-long jet lag.

If you fly from east to west and arrive in the afternoon, says Dr. Schenck, recharge by getting some late-afternoon sun, and try to stay awake until your usual bedtime back east.

Independent market analyst Datamonitor found that more than three-quarters of Australians are placing greater importance on maintaining or improving their health. A similar proportion (71%) of Australians reported that they ‘make conscious attempts to eat healthily’ either ‘all’ or ‘most of the time’.

health, salt has emerged as the ‘new villain’ in the food industry. Accordingly, a growing number of initiatives have been launched in the region to raise consumer awareness of the negative effect of salt on health.

The Australian Division of World Action on Salt & Health (AWASH), for example, launched the Drop the Salt! Campaign in a commitment to reduce salt in-take in the Australian population to 6 grams a day by 2012. Expect salt content to be top-of-mind for Australian consumers in the

coming year, and labeling of salt information to be a major focal point for manufacturers.

It is important to note how-ever, that growing concern sur-rounding ingredient composition will be accompanied by increased skepticism over product claims. This ‘trust void’ will also charac-terize Australian consumer senti-ment and purchase behaviour in 2010. Indeed, less than one-in-four Australians deem the gen-eral nutritional claims made by manufacturers to be trustworthy.

Going forward into 2010 and beyond, Australians will pay clos-er attention to product formula-tion, using nutritional labeling as a primary cue for assessing the health credentials of a product.

“In short, if Australians make a real effort to review the actu-al ingredient composition of the foods they eat, they give them-selves the best chance of achiev-ing those ever-elusive new year’s resolutions once and for all,” con-cludes Diamonon.

(Datamonitor)

Photo: www.food.gov.uk

Photo: www.breakthroughempowerment.com

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