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The Star
4 days ago
- Business
- The Star
Indonesia doubles wage subsidies, cancels electricity discount in stimulus shake-up
JAKARTA: In last-minute changes to a planned consumer stimulus package for June and July, the Indonesian government has cancelled an electricity discount but doubled wage subsidies. Finance Minister Sri Mulyani Indrawati (pic) revealed in a press conference on Monday (June 2) that the wage subsidies for low-income earners would double from Rp 150,000 (US$9) per month per individual to Rp 300,000. Eligible beneciaries include around 17.3 million workers earning up to Rp 3.5 million a month and some 565,000 'honorary teachers', a term commonly used for honorarium-based contract teachers. Sri Mulyani explained that the subsidies would ultimately be financed by BPJS Ketenagakerjaan but that the government would set aside Rp 10.72 trillion from the state coffers to 'temporarily' fund the programme. The wage subsidies are a part of a series of measures aimed at boosting consumer spending. When it was first announced last month, the package was to cover six areas, one being transportation discounts for trains, airplanes and ships, another area included discounts on road tolls for some 110 million eligible drivers. Two more areas were social aid for 18.3 million beneciaries and a discount on work accident insurance for employees in labour-intensive industries. When it was first announced last month, the package was to cover six areas, one being transportation discounts for trains, airplanes and ships, another area included discounts on road tolls for some 110 million eligible drivers. Two more areas were social aid for 18.3 million beneciaries and a discount on work accident insurance for employees in labour-intensive industries. The package originally also included a 50 per cent electricity discount for June and July, similar to what the government had granted in January and February. However, following a meeting at the State Palace and prior to June 2's press conference, Sri Mulyani announced that the discount was not doable. 'We have held a meeting with other ministers, and, for the implementation of the electricity discount, the budgeting process turned out to be a lot slower, so if we wanted it for June and July, we have determined that it could not be executed,' said Sri Mulyani. She explained the decision to double wage subsidies with the cancelled electricity discount. The Energy and Mineral Resources Ministry issued a press statement on June 2 saying it had not been involved in the formulation of the stimulus initiative helmed by Coordinating Economic Minister Airlangga Hartarto. '(The ministry) was never part of a team or any forum that talked about the electricity discount for June and July 2025,' said the ministry's spokesperson Dwi Anggia in the statement. Earlier, Energy and Mineral Resources Minister Bahlil Lahadalia said he was unaware of the initiative just days ahead of the implementation. 'I don't know whether there's already (a discussion) on the technical (level) or not; I don't know yet. One thing is for sure, I still haven't received the report until today,' Bahlil said on May 26, or 10 days before the policy's planned implementation. Such a policy should require 'communication' with the energy ministry and the Finance Ministry, Bahlil said, adding that he could only formally instruct state-owned electricity company PLN to execute it after that. Bahlil proceeded to verify the planned policy with PLN president director Darmawan Prasodjo, who happened to stand next to the minister. 'I'm sure PLN still hasn't received (any instruction). Have you received any letters from the energy ministry? You haven't, have you? Because, as far as I'm concerned, I must sign the letters and I haven't done that,' Bahlil said to Darmawan. 'Not yet,' the PLN director briey replied. In total, the consumer spending stimulus required some Rp 24.4 trillion, according to figures presented by Sri Mulyani. - The Jakarta Post/ANN
Straits Times
4 days ago
- Business
- Straits Times
Indonesia doubles wage subsidies, cancels electricity discount in stimulus shake-up
Housing before the skyline of the Jakarta business district on May 9, 2025. PHOTO: AFP In last-minute changes to a planned consumer stimulus package for June and July, the Indonesian government has canceled an electricity discount but doubled wage subsidies. Finance Minister Sri Mulyani Indrawati revealed in a press conference on June 2 that the wage subsidies for low-income earners would double from Rp 150,000 (S$11.8) per month per individual to Rp 300,000. Eligible beneciaries include around 17.3 million workers earning up to Rp 3.5 million a month and some 565,000 'honorary teachers', a term commonly used for honorarium-based contract teachers. Ms Sri Mulyani explained that the subsidies would ultimately be nanced by BPJS Ketenagakerjaan but that the government would set aside Rp 10.72 trillion from the state coffers to 'temporarily' fund the program. The wage subsidies are a part of a series of measures aimed at boosting to consumer spending. When it was first announced last month, the packaged was to cover six areas, one being transportation discounts for trains, airplanes and ships, another area included discounts on road tolls for some 110 million eligible drivers. Two more areas were social aid for 18.3 million beneciaries and a discount on work accident insurance for employees in labour-intensive industries. When it was first announced last month, the packaged was to cover six areas, one being transportation discounts for trains, airplanes and ships, another area included discounts on road tolls for some 110 million eligible drivers. Two more areas were social aid for 18.3 million beneciaries and a discount on work accident insurance for employees in labor-intensive industries. The package originally also included a 50 per cent electricity discount for June and July, similar to what the government had granted in January and February. However, following a meeting at the State Palace and prior to June 2's press conference, Ms Sri Mulyani announced that the discount was not doable. 'We have held a meeting with other ministers, and, for the implementation of the electricity discount, the budgeting process turned out to be a lot slower, so if we wanted it for June and July, we have determined that it could not be executed,' said Ms Sri Mulyani. She explained the decision to double wage subsidies with the canceled electricity discount. The Energy and Mineral Resources Ministry issued a press statement on June 2 saying it had not been involved in the formulation of the stimulus initiative helmed by Coordinating Economic Minister Airlangga Hartarto. '(The ministry) was never part of a team or any forum that talked about the electricity discount for June and July 2025,' said the ministry's spokesperson Dwi Anggia in the statement. Earlier, Energy and Mineral Resources Minister Bahlil Lahadalia said he was unaware of the initiative just days ahead of the implementation. 'I don't know whether there's already (a discussion) on the technical (level) or not; I don't know yet. One thing is for sure, I still haven't received the report until today,' Mr Bahlil said on May 26, or 10 days before the policy's planned implementation. Such a policy should require 'communication' with the energy ministry and the Finance Ministry, Mr Bahlil said, adding that he could only formally instruct state-owned electricity company PLN to execute it after that. Bahlil proceeded to verify the planned policy with PLN president director Darmawan Prasodjo, who happened to stand next to the minister. 'I'm sure PLN still hasn't received (any instruction). Have you received any letters from the energy ministry? You haven't, have you? Because, as far as I'm concerned, I must sign the letters and I haven't done that,' Mr Bahlil said to Darmawan. 'Not yet,' the PLN director briey replied. In total, the consumer spending stimulus required some Rp 24.4 trillion, according to gures presented by Ms Sri Mulyani. THE JAKARTA POST/ASIA NEWS NETWORK Join ST's Telegram channel and get the latest breaking news delivered to you.
The Star
28-05-2025
- The Star
Narcotics agency, police foil largest drug smuggling attempt in Indonesian history
Indonesian Navy personnel inspecting packages of methamphetamine at Batam Customs Port, Riau Islands, on May 26. - Antara JAKARTA: Authorities recently foiled an attempt to smuggle two tonnes of methamphetamine into the country, marking the largest drug seizure in the nation's history. A joint task force from the National Narcotics Agency (BNN), the National Police and the Indonesian Military seized the illicit drugs aboard a ship named Sea Dragon Tarawa in the waters off the Riau Islands last week. The vessel was intercepted as it sailed from the Andaman Sea toward Indonesian waters in Riau Islands Province. During the raid, authorities uncovered 67 boxes containing 2,000 packages of methamphetamine disguised as tea. The drugs were hidden in secret compartments throughout the vessel, including within its fuel tank. The Riau Islands Police arrested all six crew members on board, comprising four Indonesian nationals and two Thai citizens. They have been charged under Articles 112 and 114 of the 2009 Narcotics Law, which carries a maximum penalty of life imprisonment or the death sentence if convicted. The National Narcotics Agency (BNN) chief Comr Gen. Marthinus Hukom, said the raid was conducted after a five-month investigation and surveillance effort, which was launched after authorities received intelligence from international partners. 'This is the largest drug seizure in the history of narcotics enforcement in Indonesia,' Marthinus said at a press conference on Monday (May 26), as quoted by Kompas. The BNN has linked the methamphetamine shipment to a transnational drug syndicate operating out of the Golden Triangle, the notorious region where northeastern Myanmar borders parts of Thailand and Laos. The area has a long history of producing drugs, with trafficking networks extending as far as Japan and New Zealand. Marthinus said the drugs were destined for Indonesia as well as other South-East Asian countries such as Malaysia and the Philippines. The latest seizure comes after Indonesia's navy seized a ship carrying nearly two tonnes of methamphetamine and cocaine worth Rp 7 trillion (US$425 million) around the same area in the west of the archipelago earlier this month. One Thai national and four Myanmar nationals were also detained. The eleven suspects arrested in connection with both cases were all fishermen who were allegedly recruited by drug traffickers to smuggle narcotics to various countries. They were reportedly paid Rp 25 million per trip, with bonuses of up to Rp 50 million. Last week, authorities also foiled an attempt to smuggle 1.8 kilograms of cocaine, valued at Rp 12 billion, from the United Kingdom to Bali. The drugs were concealed in two separate packages, hidden inside dolls and stationery items, and sent via mail. Customs officers detected the narcotics during an X-ray scan and immediately alerted the Bali Police. Bali Police Chief Insp. Ge. Daniel Adityajaya said that a 43-year-old Australian man, identified only by his initials LAA, was arrested in connection with the case. 'He was apprehended at an apartment in North Kuta, Badung Regency, shortly after receiving the narcotics packages,' Daniel said on Monday. LAA is believed to be part of an international drug trafficking syndicate, and police allege that he received Rp 50 million from another trafficker to sell the cocaine to foreign tourists visiting the popular holiday island. LAA has been charged under the 2009 Narcotics Law and faces the possibility of the death penalty if found guilty. - The Jakarta Post/ANN
The Star
14-05-2025
- Business
- The Star
Jakarta Governor Pramono targets over 1,000 ‘rusunawa' units by next year to ease housing backlog
JAKARTA: The Jakarta administration plans to build two additional rusunawa (low-cost rental apartment complexes) and revitalise an existing one in the coming years to address the capital's housing backlog, with experts stressing that the projects must be easily accessible and located near economic hubs to attract tenants. The initiative was announced by Jakarta Governor Pramono Anung last week during the launch of Rusunawa Jagakarsa in South Jakarta, targeting low-income residents earning between Rp 2.6 million (US$157) to Rp 7.4 million per month. The complex, made up of three 16-story towers, contains 723 apartment units, each measuring 36 square meters and featuring two bedrooms, a living room, a bathroom, and a balcony. Monthly rents will range from Rp 865,000 to Rp 1.8 million, based on resident's income levels, as stipulated in Jakarta Regulation No. 1/2024 on regional taxes and retributions. The Rp 382 billion project also includes various supporting facilities, such as a sports field, clinic, playground, library and an early childhood education center (PAUD). 'We will build [new towers at Rusunawa] Rorotan and Padat Karya and revitalise Rusunawa Marunda,' Pramono said, acknowledging the city's responsibility to provide affordable and decent housing for its citizens. According to the Jakarta Housing Agency, the city is currently facing a housing occupancy backlog affecting at least 288,393 families, while the homeownership backlog has reached approximately 1.86 million families. Meanwhile, a 2024 report by Statistics Indonesia (BPS) revealed that only 54 percent of Jakarta households own their homes, marking the lowest homeownership rate in the country, which is well below the national average of nearly 85 percent. Another 2024 BPS report showed that, amid rising home prices, an increasing number of Jakartans are choosing to rent, making the capital the province with the highest proportion of households living in rental housing. Chico Hakim, special staffer to Governor Pramono, told The Jakarta Post on Tuesday (May 13) that the city plans to provide 1,153 additional apartment units by next year, comprising 865 new units to be built at Rusunawa Padat Karya and Rorotan IX, and 288 units to be revitalised at the currently idle Rusunawa Marunda. All of them are located in Cilincing, North Jakarta, which has the highest number of poor households among the municipality's six districts. '[The rusunawa programme] targets Jakarta residents with a monthly income below Rp 8 million,' Chico said, while also noting ongoing issues with rent arrears. According to the city's Public Housing Agency, outstanding rent payments have accumulated to Rp 95.5 billion. To prevent similar issues in the future, Chico said the city administration plans to implement stricter documentation and eligibility checks during the application process. Yayat Supriatna, an urban planner from Trisakti University, argued that the problem also stems from the remote locations of many rusunawa, making it difficult for residents to maintain stable incomes and afford rent. 'What Jakarta needs are integrated housing complexes. Building more rusunawa is essential, but they must be linked to economic activities,' Yayat said on Tuesday. Given that rusunawa residents are typically low-income individuals, Yayat added that the government should also offer them social assistance programmes and employment opportunities. 'This way, the rusunawa programme can not only provide affordable housing, but also help improve residents' livelihoods,' he said, adding that such improvements would attract more residents and change the perception of rusunawa from being seen as a last resort. Mohammed Ali Berawi, a civil engineering professor at the University of Indonesia, echoed similar concerns. While supporting the need for integration, he emphasised the importance of moving away from negative stereotypes. '[In] the design of rusunawa, [...] crucial–mobility, accessibility and available facilities all play a role,' Ali said. - The Jakarta Post/ANN
The Star
06-05-2025
- Health
- The Star
Indonesian Defence Ministry's plan to jump into pharma draws ire
JAKARTA: The Indonesian Defence Ministry's plan to establish a pharmaceutical factory to produce and distribute medicine through pharmacy cooperatives in villages across the country has been met with concern. It is feared that the initiative may violate the military's professionalism and do little to solve problems plaguing Indonesia's pharmaceutical sector. The plan was first announced by Defence Minister Sjafrie Sjamsoeddin during a meeting with House of Representatives Commission I overseeing defence and foreign affairs in Jakarta on April 30. Also attending the meeting was Indonesian Military (TNI) commander Gen Agus Subiyanto. Sjafrie said at the meeting that the plan was raised after hearing complaints about high medicine prices in Indonesia compared to other countries. Health Minister Budi Gunadi Sadikin claimed last year that certain medicines in Indonesia sometimes cost up to five times more than in Singapore or Malaysia. 'We have revitalised the pharmaceutical laboratories within the armed forces into a single factory assigned to support the national defence of medicine,' the minister said during the recorded meeting. The military's pharmaceutical factory was developed to create a more inclusive pharmaceutical ecosystem, according to Defence Ministry spokesperson Brig Gen Frega Wenas Inkiriwang. 'For the plan, we will prioritise essential, widely beneficial and accessible health needs, while supporting grassroots-level pharmacy cooperatives,' Frega told The Jakarta Post on Saturday (May 3). The initial steps toward the plan, he added, included mapping and utilising the TNI's existing laboratory infrastructure across its three branches: the Army, Navy and Air Force. The plan will focus on synchronising and optimising these resources, 'with an emphasis on efficiency and sustainability without the need for new infrastructure,' Frega went on to say. Sjafrie said at the House Commission I meeting that the Defence Ministry would work with the Health Ministry to supply medicines produced by the military laboratory through cooperatives across villages. The said cooperatives were the ones established under the Red and White Village Cooperative Programme, in which President Prabowo Subianto ordered the creation of 80,000 cooperatives across the country as part of his national development strategy. The instruction was stipulated in a presidential instruction (Inpres) issued in March. Among the programme's aims were to strengthen food self-sufficiency, promote economic equality and push for self-reliant villages in pursuit of the Indonesia Emas (Golden Indonesia) 2045 vision, the nation's aim to become an advanced and prosperous one by its centennial. The village cooperative initiative, projected to cost Rp 400 trillion (US$24 billion), will be financed through state, regional and village budgets. Each unit is then expected to provide essential goods, savings and loans, clinics, pharmacies, cold storage, warehousing and logistics services. Military observer Khairul Fahmi from the Institute for Security and Strategic Studies (ISESS) said that the plan for the Defence Ministry and TNI to be involved in drug production could be strategic intervention by the state to solve the issue of high prices and unequal distribution of medicines. However, the plan should focus on public service instead of profit making so that it does not compromise the TNI's professionalism, he warned. Khairul questioned product distribution through cooperatives, which could open room for commercialisation. 'Don't let the TNI's goodwill in producing and distributing the drugs kill business firms that must adhere to strict regulations and market mechanisms,' Khairul said. 'State intervention should correct and complement the system, not replace the old and legitimate firms.' Bhima Yudhistira, executive director of the Center of Economic and Law Studies (CELIOS), concurred, saying that the military could breach its main duty and function should it seek profit from the drug plan. He added that issues plaguing the national pharmaceutical industry are, among others, high credit interest rates for technology purchases and patent monopoly by multinational pharmaceutical companies that hinder local manufacturers to compete. Another issue is the national industry's heavy reliance on imported raw materials, which made up to 90 per cent of components used in domestic drug production. The imported materials, whose price is affected by the state of rupiah, have put local medicine manufacturers such as private firm PT Kalbe Farma and state-owned PT Kimia Farma under pressure. 'If the government wants to help the local pharmaceutical industry, it should focus on solving these fundamental issues, not replacing the existing firms,' Bhima said. Also in the April 30 meeting, the Defence Ministry raised a plan to improve military hospital services by increasing the number of specialist doctors. The ministry sought to recruit professionals from abroad in addition to relying on 75 graduates of the first cohort of the military medical undergraduate programme in the Indonesia Defense University's (Unhan) medical school. Sjafrie also emphasised the importance of improving soldiers' welfare, proposing to increase daily food and operational allowances for troopers, especially those stationed in high-risk areas. - The Jakarta Post/ANN
