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Globe Asia - STILL GOING STRONG | GLOBE ASIA

STILL GOING STRONG | GLOBE ASIA

globe asia

Published by BeritaSatu Media Holdings

Category: Business, Finance & Economics

Edition : Juli 2015

Pages : 108

ISBN : 9-771978-055965

Published : 01 Jul 2015

IDR 4.320,00

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    rogress. This has always been the  case but now science and technology are advancing at mind-boggling speed and the possibilities of innovation are truly infinite.  Imagine if through digitalization  we can provide affordable healthcare  to all 250 million Indonesians?  What

    if we use big data analytics to predict future trends and thus sharpen public policymaking? But even within this constant and rapid change, certain goods and services will always be needed. Textiles and garments will never become sunset industries but factories and companies that do not embrace tec

    hnology and automation may fade away. This is where Indonesia, with its large manufacturing base, relatively cheap labor and a vast consumer market can play a leading role. The internet and the ability to garner and analyze big data have the potential to break down the barriers to more robust econom

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    are few or no  established rules. Entrepreneurs and investors on their part must be bold and innovative. Our economy and our society face many difficult  challenges ahead.  We must innovate or perish. Shoeb Kagda Editor in Chief shoeb@globeasia.com

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    story, e-commerce is opening up the country and allowing Indonesians from all corners to buy merchandise online which may not be available where they live.   MatahariMall.Com already receives orders from more than 400 cities across the archipelago. It would not have been possible for brick and

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    ic reform and cutting the fuel subsidy. The Economy too needs to be restructured and gently moved away from dependence on cheap energy, which has distorted business costs in the past. There has been minimal infrastructure implementation, limited oil and gas development and little progress on manufac

    turing expansion, according to a report by CLSA Indonesia.   The report noted that if Joko Widodo is installed as the next president, he could be expected to push these reforms given his record of efficient implementation, good negotiating skills and readiness to tackle bureaucratic inefficienc

    y.   These steps will be crucial for the country as the external environment is expected to be more challenging in the coming months. The United States is in the process of winding down its quantitative easing policy– the policy of printing money to pump into the economy – which in

    turn will lead to rising interest rates globally. This means that Indonesian corporations will face higher borrowing costs if they intend to expand or invest in new plant and machinery.   The 2014 direct presidential elections have been a watershed event for Indonesia. The close fight between t

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    ered in  policymaking. More crucially, it must be provided with the incentives to invest for the long–term.    Shoeb K. Zainuddin Group Editor in Chief

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    ut the future of his country.   Arif is not alone. A whole new generation is rising, poised to play a leadership role in their companies and in their country. They are increasingly stepping out of the old boundaries, and taking to the global stage. They participate in international forums such

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    nation-building. They cannot afford to cocoon themselves in their private worlds and shut their eyes to what is happening around them. They know that if they want to ensure the continuity of their family business, they must also ensure the prosperity of the country as a whole.   Income inequali

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    ise of business itself.   So as they assume the helm of their family firms, these young leaders must also play an increasingly wider social role. They must lead change not just within their own organizations but also within society at larger and even in government. In the past, business owners

    focused on creating jobs, which helped support families. In today’s world, they must also be catalysts for social change.   With their ideas, energy and passion, they can affect mindset shifts across society. So while they continue to grow the  businesses their forefathers built &nbs

    p;from scratch, they need to also address the challenges faced by the country.   Shoeb K. Zainuddin Senior Editor

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    and are equipped with visionary leadership, they can do well. Garuda was a loss-making state carrier for years until the appointment of Emirsyah Satar, who not only turned the struggling national carrier around but is propelling the company toward a role as a global player.   Other CEOs such as

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    r state-owned, they must be managed according to sound commercial principles.There are currently 141 SOEs in Indonesia. They hold $300 billion worth of assets and generate an estimated $150 billion in revenue each year. While an increasing number of these enterprises are turning a profit, many remai

    n debt-ridden and dependent on state subsidies. This must change if Indonesian SOEs are to compete on par with the private sector.   SOEs are present in just about every sector of the economy from banking and finance to telecommunications and transportation, to manufacturing and oil and gas. Th

    ere are SOEs operating in the agricultural sector providing subsidized fertilizer to farmers.   There are some who argue that SOEs, because of their vital role in the economy, should not be judged purely on profit. Instead there should be different criteria for evaluating just how effective and

    important an SOE is since it may be operating in sectors or areas where private enterprises are not present.   This does not mean that there should be an absence of competition and that SOEs should be allowed to operate in a monopolistic environment. It has been proven that if SOEs are forced

    to operate in a competitive environment – aviation and telecommunications come to mind – they not only hold their own but also excel.   Both aviation and telecommunications are highly competitive sectors with multiple players and yet both Garuda and Telkom have done well and expande

    d their reach. Merpati Nusantara Airlines, on the other hand, has been an expensive disaster.   The Indonesian economy is undergoing rapid change. The country’s corporate sector can no longer hide behind protectionist barriers, especially with the ASEAN Economic Community (AEC) now a litt

    le over a year away. SOEs too must march to this new tune and adapt. They must reform, adopt global best practices and compete on par.   Shoeb K. Zainuddin Senior Editor

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    When GlobeAsia picked Jakarta Governor Joko Widodo as its Man of  the Year back in January, we were looking ahead. The governor had taken the capital by storm and now it looks likely that he will also take the country by storm.   The opposition Indonesian Democratic Party of Struggle annou

    nced on March 14 that Widodo, widely known as Jokowi, would be its presidential candidate in the July 9 presidential election.   The governor, with his “man of the people” touch and simple ways has captured the imagination of the Indonesian people. He is not afraid to get tough on l

    azy civil servants or stand up to religious intolerance. He is willing to roll up his sleeves and get personally involved with projects such as persuading slum dwellers to move to government low-cost housing or relocating the street vendors of Tanah Abang.   Jokowi’s rise from his humble

    roots in Solo to possibly the top job in the land is the stuff of dreams. He has shown that through hard work,leadership and courage, every Indonesian can rise to the top.   The governor’s presidential candidacy was also warmly received by the markets, with stocks rallying on the day the

    announcement was made.Coincidentally, the rupiah has also rallied over the past few weeks.   The question now among investors and business people is whether Jokowi’s populism means he is anti-business. Will he push policies that hurt the business environment but please certain segments of

    his supporters? Will he give away too much in terms of government largesse with negative implications for the state budget?   Jokowi did approve a 44% minimum wage increase in 2013 but he has also proved that he has common sense. When unions pushed for another huge wage increase this year, he

    was able to rebuke them for ignoring economic reality and restricted the wage increase to 11%, all without much fuss or demonstrations.   He has also kick-started the long-delayed MRT system and has continued the building of toll roads. The governor has also been a strong critic of the “c

    heap car” initiative, arguing that Jakarta’s streets are too heavily congested.  The business community is unsure of how the governor, if he does become president, will deal with them. Will he launch new initiatives to boost the economy and empower the private sector? Or will he dis

    h out lucrative contracts to his friends and cronies? Our cover story subject,   Alim Markus, for example, is a self-made successful businessman and he wants to help boost the economy by investing in smelters. The next president must work with business people like him. The governor has said he

    is not anti-business and in fact the reason he entered politics was to cut  red tape and help the small- and  medium-sized entrepreneur. As he hits the campaign trail, he will have to spell out his ideas and visions with greater clarity.   Shoeb K. Zainuddin Senior Editor

  • Globe Asia - Exclusive Interview : ARBnomics

    ARBnomics Veteran businessman-cum-politician Aburizal Bakrie was upbeat  when GlobeAsia’s Yanto Soegiarto and Albert W Nonto met him  at his 46th floor office for an exclusive interview during a gap in his busy schedule. He shared his vision of what is best for the country, his list

    of  jobs that need doing and his priorities if he gets elected.   Aburizal Bakrie, or ARB as he now wants to be called, is busy these days, shuttling back and forth to the regions to consolidate his powerful Golkar Party ahead of the upcoming legislative elections and garnering support for

    his bid for the presidency. With his background as a businessman and in government as coordinating minister for the economy and then social affairs, it is  hardly surprising that economics is high on his agenda as the elections loom closer.   Underlining his intentions if he is elected to

    the presidency is the belief that Indonesia needs to manage its economy correctly by not being too conservative in its monetary and fiscal policy, while sustaining sound macroeconomic fundamentals.   “As an example, look at the debt issue. Our debt stands at 25% of GDP. People make a lot

    of noise about our huge debt. They want to lower it by 3%. No other nation, or just a few, has such a small ratio of debt to GDP. Usually it’s 60% or it could even be 300%. My point is that we don’t have to worry about our debt-to-GDP ratio. If we have a $1 trillion economy, 1% would me

    an $12 billion, 2% would mean $24 billion. For me, a debt-to-GDP ratio of 30% is good,” ARB said. He brushed aside talk that Indonesia’s debt will be a burden for future generations. “We are missing Rp250 trillion in development opportunities with our fear of debt,” he respon

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  • Globe Asia - Outlook 2014 - How Politic Will Impact GDP Growth?

    Quality democracy As we approach the elections, GlobeAsia’s most pressing concern Is the value of our democracy, and the quality of the legislators it produces. The elections themselves will be an important step in Indonesia’s course as a nation, but it is the capacity of those we elect

    that raises doubts.   The Indonesian people are getting smarter about who they choose, and there is much debate at every level of society about who will make the best president come October. Yet there is less comprehension of the workings of the House Of Representatives, And less attention to

    the caliber of those we place there.   How should we, the people, improve the quality of our legislators and, indeed, our presidential candidates? If Yuzril Izha Mahendra’s challenge to the Presidential Election Law at the Constitutional Court succeeds, restrictions on candidacy would be

    thrown out, opening the field to a wide range of hopefuls with the net result of confusing the public.   So far, the political parties have tended to opt for popularity above talent. Electors Have been offered a choice of candidates who are attractive, but not necessarily competent. The Electio

    n of a new crop of political neophytes risks the creation of yet another parliament whose members lack grounding and experience.   Many will have only a high-school diploma, and many will have a very limited supply of the expertise needed to Make a positive contribution to national   devel

    opment. The Constitutional Court has demonstrated Without a shadow of doubt that many of our laws are flawed. It Is a sad joke that our parliament, composed of many with undemonstrated talents, feels it appropriate to sit in judgment in fit and proper tests for candidates for Armed   Forces com

    mander, National Police commander, The governor of Bank Indonesia And many other high positions. Our concern is with the quality of our democracy. It is high time the political parties were made to screen their potential candidates for more than just the ability to fund a campaign. Yet Consistently

    the parties look for the popular, not the competent, and those with deep pockets.   This is not about numbers, it is about the capacity to deliver democracy of real value. So far, we have been wasting time and money, and have only succeeded in misleading and confusing the public with flawed leg

    islation.  The business community deserves better to help it build this country and its people, and we demand that the political parties change their ways. They must act with a sense of responsibility to the nation and the Indonesian people.   It is too late for this election, but once the

    dust has settled the political parties must reform themselves and develop strategies to develop the skills of elected legislators, both now and in the future. The ways in which the political parties finance their activities has to change and become more transparent.  A failure to act, to produ

    ce better political parties and better legislators, will inevitably end in damaging our democracy.    

  • Globe Asia - Joko Widodo | Man Of The Year

    Unafraid to act GlobeAsia defines its Man of the Year as the person who is likely to exert the greatest influence on  the nation in 2014.  We closed 2013 with our 50 Most Influential List of individuals who made an impact last year, but in this issue we shift our focus to what lies ahead.

      There is no escaping the fact that 2014 will very much revolve around politics. Indonesians will go to the polls to elect their new president as well as the next parliament. And given the number of scandals and corruption cases leveled against politicians and government officials in 2013, Ind

    onesians will be looking for honesty, integrity and transparency in their new elected leaders.   It can be argued that faith and trust in elected leaders is at an all-time low. The government seems rudderless and unwilling to make hard decisions. That can only be expected given that no politici

    an wants to make unpopular decisions so close to an election.   That is exactly why Jakarta Governor Joko Widodo is unique and different. Not only is he pushing ahead with some unpopular decisions, such as relocating squatters from river banks into low-cost housing, he has made it publicly plai

    n that he is against the central government’s plan to introduce low-cost cars given the traffic gridlock in Jakarta and other major cities.   It is not often that elected politiciansspeak the plain truth and are unafraid to make some tough choices. We need leaders who are not merely popul

    ist but effective and willing to do the necessary even if it means raising the public ire. Most importantly, elected leaders must represent all Indonesians, not just the majority.   Indonesia is today under threat from various directions. We have a vibrant democracy but it risks running amok wi

    th the rule of law being sidelined. We have an economy that is still buoyant but risks being sidetracked by runaway consumption in place of investments in infrastructure and industry.      The country is crying out for leadership. Jokowi, as the governor is affectionately referred to,

    is best placed to provide it. A humble man, he is not afraid to take on powerful vested interests. He has stood up against goons in religious robes and kick-started the long-delayed mass transportation system. He has cleared the streets of illegal parking and warned public bus owners to obey traffi

    c rules.   The bottom line is that he has brought a sense of order back to Jakarta by standing firm and using his persuasive powers to convince citizens to follow his lead.  In a short span of time, he has achieved much, which is why the calls for him to run for the presidency are growing

    louder. Whether or not he will run is inconsequential because in an era where politicians are happy to just talk, Jokowi has demonstrated that he is unafraid to act.   He will therefore cast a large shadow over Jakarta and the nation in the coming year as governor of Jakarta and possibly as the

    next president of Indonesia.

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