Selasa, 23 November 2010

GARUDA'S CONTROL SYSTEM DISRUPTED DUE TO INTERNAL CORPORATE PROBLEM?

 By Andi Abdussalam

          Jakarta, Nov 24 (ANTARA) - A failure in its newly introduced integrated operational control system (IOCS)  is officially said to have caused state-owned airlines Garuda Indnonesia to delay or cancel flight schedules over the past several days but suspicion has arisen that the flight chaos was not due to a technical problem but  an internal corporate issue.

         "We suspect that the delays have happened due to an internal corporate problem. We want to examine whether the flight chaos is related to Garuda's plan to issue an initial public offering (IPO), or purely to a failure in its control system," Imam Nahrawi, a member of the House Commission V on transportation affairs, said here on Wednesday.

         He said that the House Commission V would ask for information whether the delays and cancellations of flights had something to do with PT Garuda's plan to issue its IPO  next year, or with other reasons.

         Imam who is a politician of the Nation's Awakening Party (PKB) said that so far his side had obtained information from Garuda officials at Juanda airport in Surabaya that the delays had something to do with the plan of Garuda to go public.

        "If it causes its passengers to be neglected that would mean that there is something wrong within Garuda itself," Imam said. Therefore, he said, the House Commission will also examine whether the problem had taken place due an internal conflict of PT Garuda, especially with regard to the planned replacement of PT Garuda's president director.

         "We have not yet known whether or not there is rivalry inside to win the president director's post. Who knows there is an internal conflict there. We will examine it," he said.

         For this reason, House of Representatives (DPR)'s Commission V on transportation affairs will summon the management of state-owned airlines PT Garuda next week over the delays of a number of its flight schedules last Sunday.

         Garuda's newly introduced IOCS was disrupted on Sunday, November 21, 2010, causing some of its flight schedules to be delayed or canceled.

         President director of PT Garuda Indonesia Emirsyah Satar said that the disruption of the new system started with the break of a connecting cable at the IOCS, while Garuda still has no reliable back up.

         "Consequently, the system broke down for four hours on November 19, 2010, and the peak of the disruption was reached on November 21," he said.

          Head of Garuda communications affairs Pujobroto said that the state-owned airlines previously used three separate systems to monitor the movements of flights, cabin crew members and flight scheduling. The system was then integrated.  The integrated system has repeatedly undergone trials. But on Sunday, November 21, 2010, the implementation of the system faced a problem.

         "Garuda operates 81 airplanes with 580 pilots and cabin crew members. There are 2,000 flights every week," he said.

         "Though it has been prepared, yet many complex data could not be synchronized so that information received by cabin crew members was not accurate," he said.

         On Monday, PT Garuda Indonesia estimated that the damage on the IOCS would still prevail in the next two days.

         "The IOCS was still 80 pct normal today (22/11), and two more days would still be needed to restore it to 100 pct," Emirsyah Satar said. Giving an example, Emirsyah said that for the departures on Tuesday (23/11) 13 Garuda flights to six destinations had been canceled.

         Garuda's commercial director Agus Priyanto said that the six destinations are Kuala Lumpur once, Medan twice,  Palembang four times, Semarang three times, Ujung Pandang once, and Surabaya twice.

         For the delays, Garuda Indonesia offered an apology to its customers for canceled flights in the past several days due to errors in its new computer system. "Garuda Indonesia offers the greatest possible apology for the delay and cancellation of its several flights on Sunday,"  Garuda Indonesia communications director Pujobroto said.

         Emirsyah declined to give details on losses suffered by Garuda regarding the operating system disruption. "It amounts to Rp250 million incurred by having to provide hotel accommodation to 800 passengers and other potential loss some Rp350 million," he said.

         Meanwhile, State-owned Enterprise Minister Mustafa Abubakar strongly warned the Garuda management of the failure in the operational control system that caused flight cancellations, asking it to conduct comprehensive investigation into the problem.

         "I strongly warn the Garuda management so that it will soon overcome the problem that Garuda is facing," the minister said.

        He said that a stern action must be taken against those responsible for the disruption if basic mistakes were found during the investigation.

         Minister Abubakar hoped that the IOCS disruption would not be repeated in the future and would not affect Garuda's plan to launch its IPO based on schedule.

         "This case should not be repeated so that it would not disturb Garuda plan to issue its initial public offering," Minister Mustafa.

         He said that the IPO process has now going on well and based on plan.

         Based on the schedule, PT Garuda Indonesia will launch the IPO in the first quarter of 2011. In the first phase it will release 30 percent of the total 40 percent shares that have been approved by the House of Representatives (DPR).  It hopes to collect a fund of about US$300 million to US$400 million from the IPO.***2***

(T.A014/A/HAJM/14:50/f001) 24-11-2010 14:51:0

Jumat, 19 November 2010

RI MAY IMPOSE MORATORIUM ON WORKERS DISPATCH TO SAUDI ARABIA

By Andi Abdussalam

          Jakarta, Nov 19 (ANTARA) - Following recent abuses of Indonesian migrant workers in Saudi Arabia, the Indonesian government is considering to impose a moratorium on the dispatch of its workers to that country or to impose a condition where only selected Saudi employers would be allowed to recruit Indonesian workers.

         Manpwower and Transmigration Minister Muhaimin Iskandar said after attending a limited Cabinet meeting on Friday that the government might issue a moratorium if both countries failed to find mutually advantageous agreement regarding the placement of Indonesian migrant workers in Saudi Arabia.

         "I think (moratorium could be imposed on workers dispatch to) Jordan and Saudi Arabia. But a thorough evaluation must be made in the first place until we can draw a conclusion that a moratorium would be imposed or not," the minister said.

          The minister referred to a number of cases of maltreatment and murder of Indonesian workers who worked in that country. With regard to Jordan, Indonesia has issued a moratorium and ordered manpower supplier companies to stop sending workers to that country until both nations reached mutually beneficial agreement.

         Sumiati binti Salan Mustapa (23) who hailed from Dompu, West Nusa Tenggara province, was found hospitalized last Nov 8 for serious injuries on her body believed to have been inflicted by her employer in Medina.

         On Nov 8, the Indonesian Consulate General in Jidda, Saudi Arabia, received a report that the 23-year-old woman had been taken to King Fahd hospital in Medina. She had reportedly been tortured by the wife of her employer and sustained serious injuries to many parts of her body.

         Haryatin, an Indonesian migrant worker (TKI) hailing from Blitar, East Java, is now blind due to torture by her employers in Saudi Arabia. Visited at the Undaan ophthalmic hospital in Surabaya on Thursday, the 32-year-old woman said she had been tortured for as long as three years.

          Another report said that violence also happened to Kikim Komalasari who was reported  to have been killed by her employer in Abha. Her body was found later in a garbage dump.

         "Moratorium on dispatch of workers to Saudi Arabia could be one solution to the violations against our workers. But a decision on issuing a moratorium must be accompanied by a comprehensive evaluation," Spokesman of the Ministry of Manpower and Transmigration Suhartono said.

          Apart from issuing a moratorium, the government may also set a requirement that Indonesian workers may only be employed by Saudi employers who had been selected and recommended by the Saudi government.

          "Indonesia should select their prospective employers,"  Law and Human Rights Minister  Patrialis Akbar said before attending the cabinet meeting at the Presidential Office.

         Patrialis said foreigners abroad who intended to employ Indonesians should first obtain a recommendation from their respective governments. The recommendation should state that the would-be employer fulfilled the requirements for  employing  Indonesians. This was necessary to prevent Indonesian workers from being mistreated or abused.

         The minister said the government would do its best to provide protection for all Indonesian citizens staying overseas. "We have to provide maximum  protection for our citizens wherever they are," he said.

         According to Suhartono, moratorium could be one of the solutions to overcome the frequent abuses against Indonesian workers in Saudi Arabia.

         Yet, Presidential Spokesman for foreign affairs Teuku Faizasyah said earlier on Thursday  that the government would not be issuing a  moratorium on the dispatch of Indonesian migrant workers to Saudi Arabia related to the Sumiati case.

         He said the case of Sumiati cannot be considered as a general phenomenon of all the Indonesian migrant workers in Saudi Arabia. Therefore, it is important to evaluate the work condition in that country.

          In his directives at Friday's limited cabinet meeting, President Yudhoyono said there were at present a total of  3,271,584 Indonesian migrant workers overseas with 4,385 case of maltreatment including violent act and sexual harassment.

         "The percentage of maltreatment against our migrant workers is 0.01 percent but anyway we have to make sure they have protection and proper treatment in accordance with their working contract," the president said.

          The president is therefore to send a special team  to Saudi Arabia to study the case of Indonesian migrant worker (TKI) Sumiati who had been tortured by her employers.

         The president made the decision following an internal meeting at his residence at  Puri Cikeas Indah, Bogor, Thursday night. The team would study the employment climate in Saudi Arabia to guarantee protection for migrant workers.

         Head of the Indonesian workers placement and protection agency (BNP2TKI) Moh Jumhur Hidayat said a joint team handling the case of torture of Sumiati binti Salan Mustopa had left for Saudi Arabia Thursday night.

         He said here in his electronic message that the joint team was led by State Minister for Women's Empowerment and Child Protection Linda Ameliasari Agum Gumelar.

         Meanwhile,  the Saudi government is committed to bringing the perpetrators to the court.

         Speaking to the press following a meeting at the Manpower and Transmigration Ministry, Saudi Ambassador to Indonesia Al Hayat said the Saudi government was committed to referring the case to the court.

         "We have taken steps to investigate  the case in order to bring the perpetrator to justice," he said. He said the Saudi government would not turn a blind eye to the case and would order the authorized agencies in Saudi Arabia to follow it up.

         "I believe that the authorized agencies in Saudi Arabia have taken the necessary steps to refer the case to the court," he said.

    (T.A014/A/HAJM/21:50/H-YH) 19-11-2010 21:00:2

Jumat, 12 November 2010

POLEMICS OVER KRAKATAU STEEL MAY DISCOURAGE INVESTORS

 By Andi Abdussalam

          Jakarta, Nov 12 (ANTARA) - The polemics over the sale of PT Krakatau Steel (KRAS)'s shares through an initial public offering (IPO) could discourage foreign investors and have bad impact on the investment climate in the country.

         Following the IPO,  a controversy surfaced where many quarters were of the view that KRAS' share price which was set at Rp850 percent was too low and might have benefited certain parties only while disadvantaging the state.

         Moreover, the price of KRAS share proved to be sky-rocketing on the listing day. But on the other hand, foreign investors released their shares with KRAS creating speculations that they were inconvenient with the polemics.

        "Whether it was negative or positive, I am afraid they released their shares because they felt inconvenient. Or maybe because there has been escalating gains so that they released their shares," State Enterprise Minister Mustafa Abubakar said on Friday.

         He said that the Rp850 price per share of KRAS which had sparked a public controversy was not low or high.  "The price was set after a research by the underwriters based on regulations in force," the minister said.

         The government's move to sell 3.155 billion KRAS shares worth Rp2.6 trillion, or about 20 percent of the company's  paid-up capital, through an Initial Public Offering (IPO), has however sparked a controversy as the government's price of Rp850 per share was seen by many quarters as too low.

         Of the total shares in the IPO,  35 percent were allocated for foreign investors while 65 percent others for local investors.

         "It was not impossible for the shareholder to set the price at Rp950 per share but "we think Rp850 is the most optimum," he said.

         Chairman of BUMN Watch, Naldy Nazar Haroen, said that based on data collected his organization,  the price set at Rp850 per share was illogical. During its roadshow, the number of investors who wanted to purchase the share with a price of between Rp1,150 and Rp1,200 per shares was bigger but why should the price be set lower at Rp850.

         After all,  it was proven with the sky-rocketing of the share price from Rp850 per shares to Rp1,250 on the listing day and Rp1,340 on the second day on Thursday.

         Deputy Chairman of House of Representatives (DPR) Commission XI on financial affairs Achsanul Qosasi said the there was a deal in the setting of the IPO share price at Rp850 for the benefit of several parties.

          "It has been predicted before and it is now proven that KS share prices have jumped up almost reaching 50 percent. Brokers and other players are successful in creating and applying a pricing image strategy through politicizing KRAS shares. I suspect that those who kicked a fuss in the media has nominee shares (listed on behalf of others) ," Achsanul said on Friday.

         He said that the suspicion was proven with the sky-rocketing of the shares from Rp850 per shares to Rp1,250 on the listing day and Rp1,340 on the second day on Thursday.

         With regard to the suspicion over the presence of a `deal?, the secretary general of Golkar Party, Idrus Marham, said the party was ready to support an  investigation into the controversial initial public offering .

         "Golkar has an interest in unveiling the entire case," he said.

         There have been rumors that some members of parliament have received share allocations in the IPO. He said Golkar supported an  investigation into the case of share allocation to parliament members from various parties including the establishment of a special committee for it.

         Idrus said Golkar Party general chairman Aburizal Bakrie had already given a clear instruction with regard to the case.

         In the meantime, Minister Mustafa Abubakar said his ministry would not disclose data about the sale of KRAS shares through its initial public offering (IPO). "I will not disclose the data because it is the authority of the Capital Market Supervisory Board - Financial Institution (Bapepam-LK)," he said.

         He said that based on standing procedures, the Kras IPO's data could only be disclosed by the State Audit Board (BPK) and Bapepam.

         There has been increasing demand from the public for the disclosure of the buyers of Kras IPO shares.  "Seeing from the standing procedures, we have no authority to disclose the data," he said.

          He said that all about it would be left to Bapepam. "The disclosure of the data is only possible if BPK already audited it but under the approval of the House of Representatives (DPR)," he added.

           Based on records, the price of KRAS shares was closed at Rp1,270 each at the listing on Wednesday, or an increase of 49.41 percent from its IPO price at Rp850 per share.

          Transaction reached Rp1.994 trillion with a volume of 1.6 billion shares. Foreign purchase was recorded at Rp33.326 billion with a volume of 27.8 million shares.

         With regard to the polemics, Minister Abubakar expressed concern that it would have a bad impact on the investment climate in the country, let alone, foreign investors hd also released their shares with KRAS.

         On the release of Kras shares by foreign investors, the minister hoped that it happened not because of the polemics. If it happened because of the polemics it could have a negative impact on investment at home.

         He said that it could happen because investors could already obtain significant gains so that foreign investors decided to sell their shares.

         However,  President Director of the Indonesian Stock Exchange (BEI), Ito Warsito said most of the foreign investors make their investment for a long term gain in the capital market. It was seldom to happen that foreign investors invested their capital inflow for a short term period.

         "Investment in the capital market is mostly oriented to mid and long term period," he said. Short-term investment had bigger chance of risks so that the possibility of hot money being invested in the capital market was  small.

         He said that the pros and cons over KRAS' share sale through the IPO, would discourage foreign investors if the polemics continued.

         "The purchase by foreign investors was questioned. It could cause trauma to them," he said.***2***

(T.A014/A/H-NG/A014) 12-11-2010 23:55:4

Kamis, 11 November 2010

PERTAMINA'S ACQUISITION OF MEDCO TO RAISE ITS OIL OUTPUT

By Andi Abdussalam

           Jakarta, Nov 11 (ANTARA) - State-owned oil and gas company Pertamina's plan to acquire PT Medco Energi International is hailed by many quarters, including legislators, as a strategic step to reinforce its business in the upstream sector and increase its oil production.

         "Medco's acquisition has the potential to benefit Pertamina because Medco has a number of potential oil fields at home and abroad that could raise Pertamina's oil output and national oil production," Dito Ganinduto, a member of the House of Representatives (DPR)'s Commission VII on energy affairs, said.

         The same opinion is also voiced by Pri Agung Rakhmanto, executive director of ReforMiner Institute, who viewed Pertamina's move to acquire Medco as a strategic step. He said that the plan was a business strategy being developed by Pertamina to increase its oil output.

         This step will have positive impact on the government's oil production target of 1 million barrels per day in 2015. After all, Pertamina and Medco are two oil and gas firms which are trying to build themselves into a world class firm.

         Pertamina and Encore International Limited (EIL) have signed a principle of agreement as part of the step for Pertamina to purchase the EIL stake at Encore Energy Pte Lted ((EEPL). EEPL owns 50.7 percent shares at Medco Energi International. With the acquisition, Pertamina will automatically control 27.9 percent of Medco shares.

         The two sides have agreed to continue the sale purchase of EIL shares at EEPL to an exclusive phase which would end on November 30, 2010.

         Medco is recorded to have oil blocks at home and abroad. At home it has ones in South Sumatra, Sembakung oil Block, Tiaka Oil Block, the Lematang and Senoro gas fields as well as Blcok A gas field in Aceh. It also has 12 oil drilling wells abroad, among others in the United States, Yemen, Cambodia, Libya, Tunisia and Oman.

         Medco's oil output as of August 2010 reaches 30,974 barrels per day which exceeds its annual target of 29,690 barrels per day.

         Pertamina's  Vice President for Corporate Communications, Mochamad Harun, said his company's step to acquire Medco was part of the efforts to achieve the target of 1 million barrels of oil equivalent per day (boepd) in 2015.

         "We have the target to produce up to 1 million boepd in 2015. For this, Pertamina could not merely rely on existing fields but also on the ways of merger and acquisition," he said.

         He said that Pertamina would have additional output of about 10 thousand barrels per day with the acquisition of Medco.

         However, Pertamina was suggested to also purchase Medco's oil blocks if it wanted to effectively raise its  output. Director of the Center for Public Studies Research (Puskepi) Sofyan Zakaria,  said that the acquisition of Medco was not a too precise step.

         "The acquisition of the shares would not directly raise Pertamina's oil production. This is unlike if it purchases the oil field," he said.

         The purchase of the shares meant that Pertamina would also bear the debts of Encore.  "Because what were purchased were corporate shares, all responsibilities and burdens will also become the burdens of the shareholders," the Puskepsi director said.

         Yet, legislators supported the acquisition plan by Pertamina.  "The acquisition plan is a corporate action of both sides. I support the step because it would lead Pertamina to become a global player in the world oil business," Achmad Ferial, another member of the House Commission VII, said on Thursday.

         He said that through the acquisition process, Pertamina could increase its performance and supports its transformation into a reputable company in the world. However, the acquisition should guarantee that Pertamina would be able to increase its oil and gas production in the future.

         Legislator Dito Ganindito, also of Commission VII, said Pertamina's plan to acquire Medco needed support.  He said that if it acquired Medco, Pertamina would obtain not only supply for increasing its production capacity but also dividends from the acquisition.

         "So, the chance for Pertamina to become a world class oil and gas company would soon become a reality," Dito, who hailed from the Golkar Party faction, said.

         Pertamina is now surrounded by foreign oil firms which dominate the oil business in Indonesia. Exxon Mobil, Shell and British Petroleum are foreign firms which control most of the country's oil fields. Malaysia's Petronas which could be said to have learned its experience from Indonesia is now more progressive than Pertamina.

         Therefore, it is now time for Pertamina to become a main player in the oil business. If this expectation is fulfilled, Pertamina would become a strong firm to compete in the world market.

         There are many strategies that could be applied by Pertamina to fulfill the expectation, among others through the acquisition of Medco, he said.

         Vice President for Corporate Communications of Pertamina, Mochammad Harun said Pertamina's hope for becoming a world class firm needed support. The immediate target it has to realize is to achieve its target of 1 million barrel production per day, at least in 2015.

         Pertamina could achieve the target if it maximizes its oil and gas  upstream production capacity. The upstream sector would serve as Pertamina's growth center, he said.

         "We have the target to produce one million barrels of oil per day in 2015," he said.

    
(T.A014/A/HAJM/21:59/a/R013) 11-11-2010 22:15

PERTAMINA'S ACQUISITION OF MEDCO TO RAISE ITS OIL OUTPUT

BY ACQUIRING MEDCO, PERTAMINA'S OIL OUTPUT TO RISE By Andi Abdussalam

           Jakarta, Nov 11 (ANTARA) - State-owned oil and gas company Pertamina's plan to acquire PT Medco Energi International is hailed by many quarters, including legislators, as a strategic step to reinforce its business in the upstream sector and increase its oil production.

         "Medco's acquisition has the potential to benefit Pertamina because Medco has a number of potential oil fields at home and abroad that could raise Pertamina's oil output and national oil production," Dito Ganinduto, a member of the House of Representatives (DPR)'s Commission VII on energy affairs, said.

         The same opinion is also voiced by Pri Agung Rakhmanto, executive director of ReforMiner Institute, who viewed Pertamina's move to acquire Medco as a strategic step. He said that the plan was a business strategy being developed by Pertamina to increase its oil output.

         This step will have positive impact on the government's oil production target of 1 million barrels per day in 2015. After all, Pertamina and Medco are two oil and gas firms which are trying to build themselves into a world class firm.

         Pertamina and Encore International Limited (EIL) have signed a principle of agreement as part of the step for Pertamina to purchase the EIL stake at Encore Energy Pte Lted ((EEPL). EEPL owns 50.7 percent shares at Medco Energi International. With the acquisition, Pertamina will automatically control 27.9 percent of Medco shares.

         The two sides have agreed to continue the sale purchase of EIL shares at EEPL to an exclusive phase which would end on November 30, 2010.

         Medco is recorded to have oil blocks at home and abroad. At home it has ones in South Sumatra, Sembakung oil Block, Tiaka Oil Block, the Lematang and Senoro gas fields as well as Blcok A gas field in Aceh. It also has 12 oil drilling wells abroad, among others in the United States, Yemen, Cambodia, Libya, Tunisia and Oman.

         Medco's oil output as of August 2010 reaches 30,974 barrels per day which exceeds its annual target of 29,690 barrels per day.

         Pertamina's  Vice President for Corporate Communications, Mochamad Harun, said his company's step to acquire Medco was part of the efforts to achieve the target of 1 million barrels of oil equivalent per day (boepd) in 2015.

         "We have the target to produce up to 1 million boepd in 2015. For this, Pertamina could not merely rely on existing fields but also on the ways of merger and acquisition," he said.

         He said that Pertamina would have additional output of about 10 thousand barrels per day with the acquisition of Medco.

         However, Pertamina was suggested to also purchase Medco's oil blocks if it wanted to effectively raise its  output. Director of the Center for Public Studies Research (Puskepi) Sofyan Zakaria,  said that the acquisition of Medco was not a too precise step.

         "The acquisition of the shares would not directly raise Pertamina's oil production. This is unlike if it purchases the oil field," he said.

         The purchase of the shares meant that Pertamina would also bear the debts of Encore.  "Because what were purchased were corporate shares, all responsibilities and burdens will also become the burdens of the shareholders," the Puskepsi director said.

         Yet, legislators supported the acquisition plan by Pertamina.  "The acquisition plan is a corporate action of both sides. I support the step because it would lead Pertamina to become a global player in the world oil business," Achmad Ferial, another member of the House Commission VII, said on Thursday.

         He said that through the acquisition process, Pertamina could increase its performance and supports its transformation into a reputable company in the world. However, the acquisition should guarantee that Pertamina would be able to increase its oil and gas production in the future.

         Legislator Dito Ganindito, also of Commission VII, said Pertamina's plan to acquire Medco needed support.  He said that if it acquired Medco, Pertamina would obtain not only supply for increasing its production capacity but also dividends from the acquisition.

         "So, the chance for Pertamina to become a world class oil and gas company would soon become a reality," Dito, who hailed from the Golkar Party faction, said.

         Pertamina is now surrounded by foreign oil firms which dominate the oil business in Indonesia. Exxon Mobil, Shell and British Petroleum are foreign firms which control most of the country's oil fields. Malaysia's Petronas which could be said to have learned its experience from Indonesia is now more progressive than Pertamina.

         Therefore, it is now time for Pertamina to become a main player in the oil business. If this expectation is fulfilled, Pertamina would become a strong firm to compete in the world market.

         There are many strategies that could be applied by Pertamina to fulfill the expectation, among others through the acquisition of Medco, he said.

         Vice President for Corporate Communications of Pertamina, Mochammad Harun said Pertamina's hope for becoming a world class firm needed support. The immediate target it has to realize is to achieve its target of 1 million barrel production per day, at least in 2015.

         Pertamina could achieve the target if it maximizes its oil and gas  upstream production capacity. The upstream sector would serve as Pertamina's growth center, he said.

         "We have the target to produce one million barrels of oil per day in 2015," he said.

    
(T.A014/A/HAJM/21:59/a/R013)11-11-2010 22:15

Rabu, 10 November 2010

OBAMA'S VISIT UNLIKELY TO BOOST RI-US TRADE

 By Andi Abdussalam

           Jakarta, Nov 10 (ANTARA) - Different from government officials who saw US President Barack Obama's tour of Indonesia as a positive signal to bilateral trade, economic observer Tony Prasetiantono said the visit would not raise bilateral  trade volumes.

          "I think it will  be difficult (for the two countries to increase their trade volume) because though we buy US products, they face competition from other nations. Its automotive products face competition from Japan as well as from South Korea. On the other hand, the United States is now trying to reduce its trade deficit which with China alone reaches US$250 million per annum," he said here on Wednesday.

         In his speech at the University of Indonesia, Obama expressed optimism that trade between the two nations could be boosted.

         "America has a stake in Indonesia that is growing, with prosperity that is broadly shared among the Indonesian people - because a rising middle class here means new markets for our goods, just as America is a market for yours ," Obama said.

         He said that the United States was investing more in Indonesia, its exports had grown by nearly 50 percent, and it was opening doors for Americans and Indonesians to do business with one another.

         According to Tony, if the superpower wanted to increase its trade with Indonesia it should first be prepared to have a bigger trade deficit with Indonesia.

         "So, to my mind, Obama's statement that the United States is willing to become Indonesia's number one trade partner is only a mere statement. We should appreciate it as a statement and as a wish. But in reality the United States will have  difficulty becoming our  number one trade partner," he said.

         He said that there was a structural problem which was difficult to solve in order to really raise Indonesia - US trade volume, after all , US products will  be facing competition from other countries.

         "The competition is not seasonal in nature but its commodities face competition from many  substitutes from other countries. On the other hand, the United States must in fact be unwilling (to become Indonesia's number-one trade partner) because with China alone it is already overwhelmed. This is because number one trade partner would mean  exporting and importing much," he said.

         Earlier, Chief Economic Minister Hatta Radjasa said that the United States constituted a big export destination for Indonesia goods. There were still many opportunities that could be developed by both nations, particularly in the trade sector.

         "In term of trade volume and export destination, the United States ranked third and always gives us a surplus. Thus, it is a relatively big export destination country for Indonesia," he said.

          He expressed hope that the trend of Indonesia-US trade would increase like that in 2008 when it reached US$21 billion.

         "We admitted that it was going down slightly in 2009 but in 2010 it is now showing an upward trend, namely about US$21 billion where Indonesia has always enjoyed a surplus of about US$5 billion," he said.

         The minister said that Indonesia must use Obama?s visit to secure ways to improve its economic conditions. Thus it would be able to increase the volume of the two countries' bilateral trade to US$35 billion and to attract US$1 billion  investment to Indonesia.

         "Indonesia must use the opportunity to secure ways to improve its economic conditions. The value of their two-way trade has now reached S$20 billion but efforts must be made to raise it to US$35 billion," Hatta Rajasa said.

          With President Barack Obama's visit to the country on Nov 9-10, Industry Ministry has projected US investment in Indonesia will hit a record high of US$1 billion in the next few years.

          "US investment in Indonesia is relatively small compared to that of other Asian countries, such as Japan and South Korea. I hope it could increase following Obama's visit," Industry Minister MS Hidayat said.

          He said the government would encourage US companies to invest in heavy-duty equipment and machinery industries. A number of US companies had so far invested in the heavy-duty equipment industry including Caterpillar Inc.

          Caterpillar Inc. planned to invest US$500 million in Indonesia next year, he said.

          Hidayat said that the arrival of Obama in Indonesia would boost US investment in Indonesia, particularly processing industrial sector.

            "So far, the United States has made investments in oil, gas, mining and natural resources. I hope it would enter into other type of industry, such as heavy equipment industry," the minister said.

             Deputy Trade Minister Mahendra Siregar said Obama's visit can be a means of showing Indonesia's ever-fast economic growth. He said that the United States was an important investment source so that the existing relations needed to continuously be improved to attract more investment and to benefit from trade activities.

             Therefore, businesses of both nations needed to assess potentials for increased cooperation in the future. The United States is a main export destination for Indonesia. The value of Indonesia's trade with the United States continued to increase in the  2005 - 2008 period before it dropped in 2009.

             In 2008, Indonesia-United States two way trade totaled US$20.9 billion which in 2009 dropped to US$17.9 billion. The total trade value of both nations in the January - August 2010 period stood at US$15.6 billion, which were higher than that in the same period in 2009 which stood at US$11.3 billion.

             Indonesia has always enjoyed a surplus in its trade with the United States since 2005. The surplus of trade between Indonesia and the United States in 2009 was recorded at US$3.7 billion and in the January - August 2010 period it stood at US$2.8 billion.

    
(T.A014/A/HAJM/00:30/A014) 11-11-2010 00:29

Selasa, 09 November 2010

OBAMA'S VISIT TO BOOST RI, U.S. TRADE

 By Andi Abdussalam

          Jakarta, Nov 9 (ANTARA) - The two-day state visit in Indonesia of US President Barack Obama is expected to increase the volume of the two countries' bilateral trade to US$35 billion and to attract US$1 billion  investment to Indonesia.

         "Indonesia must use the opportunity to secure ways to improve its economic conditions. The value of their two-way trade has now reached S$20 billion but efforts must be made to raise it to US$35 billion," Chief Economic Minister Hatta Rajasa said.

         President Obama and his wife Michelle Obama arrived in Jakarta on Tuesday where he was scheduled to meet with President Susilo Bambang Yudhoyono, witness the signing of an Indonesia-US comprehensive partnership agreement, visit Istiqlal Mosque and give a public lecture at the University of Indonesai (UI).

         According to People's Consultative Assembly (MPR) Chairman  Taufiq Kiemas, President Obama's state visit to Indonesia will benefit the country. "I think, Barack Obama's visit will benefit Indonesia," Taufiq said here Tuesday.

        Obama's visit was an opportunity to discuss improvement of economic cooperation with the US with the aim of increasing Indonesia's economic growth, he said.

         This is an opportunity that has to be seized. Suryo Bambang Sulistyo, chairman of the Indonesian Chamber of Commerce and Industry (Kadin), said meanwhile that the visit to Indonesia was a chance for both countries to increase their economic ties.

         "The visit can give them encouragement. We can utilize the visit to convince business players in the United States that Indonesia is an interesting investment destination," Suryo said.

         He said that the Indonesian government and business makers could capitalize on the US president's visit as a promotional means to attract more US investment and offer export products to that country.

         With President Barack Obama's visit to the country on Nov 9-10, the Industry Ministry has projected US investment in Indonesia will hit a record high of US$1 billion in the next few years.

         "US investment in Indonesia is relatively small compared to that of other Asian countries, such as Japan and South Korea. I hope it could increase following Obama's visit," Industry Minister MS Hidayat said.

          He said the government would encourage US companies to invest in heavy-duty equipment and machinery industries. A number of US companies had so far invested in the heavy-duty equipment industry including Caterpillar Inc.

          Caterpillar Inc. planned to invest US$500 million in Indonesia next year, he said.

          Besides in heavy-duty equipment, the visit to Indonesia is also expected to boost  foreign investment in the renewable energy sources sector. "We expect there will be more transfer of technology for development of renewable energy sources, and investment in the management of  the technology,"  Minister  Hatta Rajasa.

         According to Kadin Chairman Suryo Bambang Sulistyo the visit should be utilized to promote investment in the country. "This should be done so that private business players in the United States would give more attention to Indonesia as an interesting investment destination," Suryo said.

         Besides, he said, businesspeople at home should also proactive in expanding Indonesian products' market shares in the United States. Indonesia must be smart in expanding its market. It should not merely serve as a market.

         In this case, MPR Deputy Chairman Hajrianto Tohari said that Indonesia must be smart so that it would not be manipulated in the economic field by superpowers like the United States and China.

         "It should not happen that Indonesia is manipulated by the two countries. We should be able to utilize the meeting and to take the benefit for the national interest," Hajrianto Tohari said.

         He said that seeing from the population aspect, the biggest market is China with a population of 1.3 billion, followed by the United States (300 million) and Indonesia 240 million. Indonesia's trade with China now stands at 30 billion US dollars.

        Thus, with the visit of Obama, Indonesia must take advantage of it.

         Industry Minister MS Hidayat said that the arrival of Obama in Indonesia would boost US investment in Indonesia, particularly processing industrial sector.

        "So far, the United States has made investments in oil, gas, mining and natural resources. I hope it would enter into other type of industry, such as heavy equipment industry," the minister said.

         Deputy Trade Minister Mahendra Siregar said Obama's visit can be a means of showing Indonesia's ever-fast economic growth. He said that the United States was an important investment source so that the existing relations needed to continuously be improved to attract more investment and to benefit from trade activities.

         Therefore, businesses of both nations needed to assess potentials for increased cooperation in the future. The United States is a main export destination for Indonesia. The value of Indonesia's trade with the United States continued to increase in the  2005 - 2008 period before it dropped in 2009.

         In 2008, Indonesia-United States two way trade totaled US$20.9 billion which in 2009 dropped to US$17.9 billion. The total trade value of both nations in the January - August 2010 period stood at US$15.6 billion, which were higher than that in the same period in 2009 which stood at US$11.3 billion.

         Indonesia has always enjoyed a surplus in its trade with the United States since 2005. The surplus of trade between Indonesia and the United States in 2009 was recorded at US$3.7 billion and in the January - August 2010 period it stood at US$2.8 billion.

    (T.A014/H-NG/H-YH) 09-11-2010 23:03:

Senin, 08 November 2010

RI, JAPAN TO NEGOTIATE INALUM THIS MONTH

 By Andi Abdussalam

          Jakarta, Nov 9 (ANTARA) -  Indonesia and Japan will this month start negotiating the future of  PT Indonesia Asahan Aluminium (Inalum), an Indonesia-Japan joint venture the contract on which  will expire in 2013 after operating for about 30 years in Asahan, North Sumatra.

         The Indonesian delegation to the negotiations would be led by Industry Minister Mohammad S Hidayat. Initially scheduled to be started on November 5, 2010, the talks were expected to be held in the middle of this month, after the Asia-Pacific Economic Cooperation (APEC) meeting in Japan on November 7 - 14, 2010.

         "The exact schedule will be made after I return from attending the APEC meeting," the industry minister said.

         The initial meeting scheduled for November 5 was canceled because the president had not yet issued a decision on the formation of Indonesia's negotiation team.

         "Now, the presidential decision has been issued and I have been assigned to chair the team," Minister Hidayat said.

          The minister said earlier that the government would do its best to serve and defend the  national interest in the negotiations with Japan.

         With an annual production capacity of 230,000 - 240,000 tons, Inalum which is  58.87 percent  owned by Japan and 41.13 percent by the Indonesian government, will see  its contract expire in 2013.

          Up to now, Japan with 12 private Japanese firms in the joint venture is the majority shareholder through Nippon Asahan Aluminium (NAA). A total of 50 percent of NAA shares are controlled by  the Japan Bank for International Cooperation (JBIC) while the remaining 50 percent are owned by Japanese private firms such as Sumitomo Chemical Company Ltd, Sumitomo Shoi Kaisha Ltd, and Nippon Light Metal Co Ltd.

         As the cooperation project will expire in 2013, Indonesia and Japan will renegotiate the future of the aluminum producer firm. Japanese investors have submitted a proposal which in essence asked that the contract be extended for another 30 years beginning in 2013, with the same share composition.

         However some quarters have called on the Indonesian government not to extend the contract of Inalum with the Japanese side.

         The rejection was among others raised by legislators Satya W Yudha and Dito Ganinduto of the House of Representatives (DPR)'s Commision VII on energy affairs. Rejection also came from Executive Director of Indonesia Resources Studies (Ires), Marwan Batubara.

         Satya W Yudha said Japan had bad records in Inalum management in the past 30 years. He said that the presence of Inalum did not benefit the government and the local people. "The Indonesian government must be firm in taking over the Inalum management and terminate the contract with Japan," he said.

         His colleague Gito Ganinduto said Indonesia had state-owned firms (BUMN),  technological capability, human resources, funding, raw materials and markets so that it was ready to take over Inalum.

         Executive Director of the Institute for Development of Economics and Finance (Indef) Ahmad Ernai Yustika said that the government should own 100 percent stake of Inalum and should not give a chance to Japan to extend the contract.

         "The government should fight for the interest of the nation so that Inalum would be manage by our own ," he said.

          Therefore, he said, there is no need for the government to follow the audit results of Ernst & Young over Inalum. Ernst & Young (E&Y) last was conducting an auditing over the financial performance of PT Inalum. The results of the auditing are expected to serve as a reference for the government to take a decision.

          The same voice was also aired by Executive Director of the Indonesian Resources Studies (Ires), Marwan Batubara. He said that the audit of E&Y should only serve as a reference for the government to know the amount of compensation it could spend after the contract with Japan was terminated.

         He asked E&Y to conduct the audit professionally and transparently. "It may not take side with either side of the two," Marwan who is a former member of the Regional Representatives Council (DPD) said.

         Earlier Minister of Industry MS Hidayat said the results of E&Y auditing would be used by the government as a reference when it held a negotiation with Japan.

         Dito added that it was now time for Indonesia to manage Inalum itself and discontinue the Inalum  contract with Japan. Japan has enjoyed the benefit in the management of Inalum for about 30 years.

         In the meantime, Minister of State Enterprises (BUMN) Mustafa Abubakar has sent a letter to the Asahan Authority on October 29, 2010, which informed that Indonesia would take over Japanese shares with Inalum as of October 31, 2013.

         A consortium of BUMNs consisting of state-owned power utility PLN, tin mining PT Aneka Tambang, Asset Management Firm (PPA) and PT Danareksa will be involved in the share takeover.

         Earlier, Chief Economic Minister Hatta Rajasa said that the government had prepared two options in the face of negotiations with Japan over the Inalum future.

         The second option is that the government and Japan would continue their cooperation but with options that benefit Indonesia. "For instance, the Indonesian government should be the majority share holder," he said.***2***

(T.A014/A/HAJM/A/S012) 09-11-2010 00:19

Minggu, 07 November 2010

GOVT TO WRITE OFF DISASTER VICTIMS' CREDITS

 By Andi Abdussalam

           Jakarta, Nov 7 (ANTARA) - The government is expected to write off  debts it has provided under the small-holder's credit (KUR) scheme for the victims of flash floods in Wasior, West Papua, Mt Merapi eruption in Central Java and earthquake/tsunami in Mentawai Islands in West Sumatra.

         "We will do our best to write off their KUR debts. The victims of natural disasters in Wasior, Merapi and Mentawai must be freed from their KUR debts," Minister for Cooperatives, Small and Medium-Scale Enterprises (UKM), Sjarifuddin Hasan, said here on Sunday.

         The ministry of cooperatives and UKM will therefore directly take stock in the field of the number of KUR debtors and conduct a cross-check in its data base to ensure the number of KUR recipients who needed to be freed from repayment obligations.

         "We will write off their debts and do our best to provide them with another credit so that they would be able to re-activate and recover economic activities in their respective regions," the minister said.

          Three natural disasters, particularly the Mentawai and Merapi ones, are at present in the stage of emergency response where all government agencies and ministries are being mobilized to help provide assistance in accordance with their respective duties and authorities.

         After that the regions would enter the stage of reconstruction and rehabilitation. "We will get down there to assist them in recovering their economy and rebuilding their future," the minister said.

         In Mentawai for example, the earthquake and its subsequent tsunami have affected KUM clusters which produced handicraft products and local handicraft souvenirs. In Yoyakarta and Central Java, which were impacted by Mt Merapi eruption, several tourist destination villages which also UKM production centers were affected by the mount eruption.

         "We are concerned with the disasters there but we will  make a joint effort to recover the economic activities there so that the wheel of economy would roll on again," Minister  Sjarifuddin Hasan said.

         Besides, the government will also write off the debts of cow breeders who were affected by the eruptions of Mt Merapi in Central Java and Yogyakarta, according to Guritno Kusumo, secretary to the minister for cooperatives and UKM.

         "The government will also help repair cooperatives and UMK equipment which was damaged by eruptions," he said.

          The government has also set aside Rp3 trillion for social affairs assistance, which in the past was known as rotating funds.  
    "The ministry of cooperatives and UKM this year predicts Rp1.2 trillion in rotating funds that could be repaid by cooperatives," he said.

          He said that recipients of social affairs assistance had no obligation to repay it but the ministry of cooperatives and UMK hoped the funds would be rotated.

         Head of Industry, Trade and Cooperatives Service of Yogyakarta Astungkoro said that there were two cooperatives which were affected by Merapi eruptions in Sleman, namely the Kaliurang UPP and Sarono Makmur cooperatives.

         These cooperatives among others managed cow breeding. He said that there were 325 cows which were killed by the eruptions there, of which 172 belonged to the Kaliurang UPP cooperatives.

         "We are still counting losses which had to be borne by the cooperatives and UKM as a result of the mount eruption," he said. Hopefully this would be compensated by the government.

          In the meantime, the Indonesian Native Businessmen Association (HPPI) also called on the government to reschedule the credits it had provided to micro-small and medium-sized businesses (UMKM) which have become the victims of natural disasters, particularly Mt Merapi eruption.

         "The government should take a special policy regarding the fate of businesses which are affected by the Mt Merapi eruptions," Deputy Secretary General of HPPI Herman H Suropo said.

         Rescheduling could be imposed in a period of three to six months, or in an unspecified period due to the unpredictable condition of Mt Merapi, which has erupted several times and killed at least 135 people and caused the evacuation of 283,000 others since October 26, 2010.

         Herman said that the government needed to issue the policy for the rescheduling of the victims' credits because it was important for businesses to boost the real sector there in the post disaster period.

         Thus, HPPI hailed the government decision to compensate the local people's  cattle and animals which were killed in in Mt Merapi eruption. The government could also take the same policy for UMKM businesses in the danger zones.

         "Hundreds of pondoh zalacca palm farmers, restaurants and home industry businesses in Kaliurang, Yogyakarta, and also hotels within a radius of  20 kilometers from Merapi are affected by eruptions," Herman said.

         He said that based on the idea of the Indonesian Red Cross (PMI) Chairman Jusuf Kalla, the disaster handling should consist of three phases, namely emergency response where the victims must be evacuated and safeguarded, rehabilitation of disaster locations by reconstructing people's settlements and recovery where businesses and economy in the disaster regions are rebuilt.

         "In this case, rescheduling of UMKM credits can be done during the third phase of the disaster handling. The aim is to revive the spirit of UMKM players," Herman said.T.A014/H-NG/A/R013) 07-11-2010 23:21

Jumat, 05 November 2010

MT MERAPI BECOMING MORE DANGEROUS

 By  Andi Abdussalam

          Jakarta, Nov 5 (ANTARA) - Mount Merapi, one of the world's most active volcano near Yoyakarta in Central Java, has since its eruption last week continued to show its 'anger', with another eruption on Friday, spewing hot clouds and killing again at least 64 residents.

         The increased activities of Mt Merapi prompted the authorities to extend the danger zones from a radius of 15 to 20 km from its crater. It has forced about 40,000 people living near the mountain  to flee to the nearest safer place, Yoyakarta.  
     Up to 64 people had been found dead after the eruption at 00.40 hours on Friday, consisting of 34 males and 30 females.

          With the latest developments on Friday,  President Susilo Bambang Yudhoyono decided to directly monitor the volcano's conditions and emergency response efforts. He moved his office  temporarily to the Presidential Palace in Yogyakarta.

          "I will depart (for Yogyakarta) soon because I have to join the people there to ensure that I am together with them," he told a press conference at the Presidential Office. The President said the presence of temporary office in Yogyakarta would speed up the decision-making process in a state of disaster crisis.

          "I plan to stay at Gedung Negara building. I hope both central and regional officials will carry out all the tasks I have instructed," he said.

            He instructed the Indonesian military (TNI) to form a special brigade and the Indonesian police (Polri) to form a special task force under the command of the head of the National Disaster Mitigation Board (BNPB).

           The BNPB will soon hold a coordination meeting to follow up President Yudhoyono's instruction regarding control of emergency response operations in areas affected by the Mt Merapi eruptions.

         "BNPB will soon hold a meeting with the local governments, the regional police and military command chiefs," Wisnu Wijaya, director for disaster alertness affairs of the BNPB, told ANTARA from Sleman through the phone.

          He said the president had instructed that the emergency response operations should be under one command,  BNPB head Syamsul Maarif said. BNPB would be assisted by the governors of Yogyakarta, Central Java, chief of the Diponegoro Military Command, the chiefs of Central Java and Yogyakarta Regional Police.

         "To follow up the instruction we will hold a coordination meeting soon," he said. Representatives from the central government would also be involved in the emergency response operations.  The agenda of the meeting would among others include a review of the needs of refugees, possible new sites for refugees and others.

          But Wisnu could not yet ascertain the places that would possibly be made new refugee centers. "We should discuss it first in a meeting so that we can  not yet ascertain it," he said.

          In the meantime, the military (TNI) will set up field hospitals and public kitchens in several places to serve evacuees from the Mount Merapi eruptions,  Wisnu Wijaya said.

         In line with President Susilo Bambang Yudhoyono's instruction TNI would field a brigade to help in the Merapi disaster mitigation efforts. The brigade consists of medical, engineering, marine and transport battalions.

         He said the military brigade would set up field hospitals, activate all hospitals in the region and set up a public kitchen.

         It would also mobilize transport means to move people from one place to another, he said. The brigade would be under the coordination of BNPB chief, Syamsul Maarif. President Yudhoyono has named BNPB as the chief coordinator of the Merapi disaster mitigation efforts.

         "We will set up field hospitals and public kitchens in several locations," he said.

    The TNI has also made ready six Hercules C-130 and three C-212 Cassa aircraft in Abdurahman Saleh airbase in Malang, East Java, in case they are needed for mass evacuation of Merapi eruption victims.

          The airbase's commander, Air Commodore Agus Dwi Putranto, said to reporters in Malang on Friday the aircraft had been used to carry aid to Wasior, Papua, which was recently hit by flash floods.

         Mount Merapi first erupted on Tuesday last week, killing 23 people, including Mbah Maridjan, the volcano's `spiritual' caretaker, and forced 20,000 others to evacuate.

          Now, around 40,000 evacuees are staying in Yogyakarta, following its huge eruption   on Friday, Yogyakarta governor Sri Sultan Hamgengku Buwono X said.

         "The number is still being recorded but for the time being it has reached 40,000 or rising almost 100 percent after the danger zone is expanded to a radius of 20 kilometers away from the crater," he said.

          He said the evacuees were only the ones accommodated at Maguwoharjo Stadium and Youth Center in Sleman. "We do not know the number of evacuees in the other parts of the province or the city. It is still being recorded," he said.

         He said the government of  Yogyakarta province,  where a part of the volcano is located, had asked for centralizing the evacuation to Maguwoharho Stadium and the Youth Center to ease coordination and services.

          The two places are located around 30 kilometers from the mountain's peak and so are quite safe. "We are very concerned over the number of deaths due to the eruption early on Friday. Many people staying within a radius of 10 to 20 kilometers were not ready and therefore many had fallen victims," he said.

(T.A014/A/HAJM/00:35/a014) 06-11-2010 00:34:5

Rabu, 03 November 2010

MERAPI RESIDENTS NEED RELOCATION

 By Andi Abdussalam


           Jakarta, Nov 3 (ANTARA) - Tens of thousands of villagers living in the slopes of Mt Merapi in Central Java which has erupted several times since last week,  indeed need relocation, yet the government seems unlikely to move them to other permanent locations.

         Areas in the danger zones have been crippled by hot ashes and other volcanic avalanches. Mt Merapi --which erupted on Tuesday last week, killing 23 people and forcing 20,000 others to evacuate -- erupted again on Wednesday afternoon which expert said three time bigger than that of last week.

         Seeing the impact of the eruption,  Yogyakarta governor Sultan Hamengkubuwono X said that some people displaced by Mt. Merapi eruption may need permanent relocation from their villages as their farming fields would not produce any crops in the next 10 years.

         "What we can consider for now is that those farming fields would not be able to be planted with crops for the next ten years. So, from where can these people eat (if not we relocate them)?" the Sultan was quoted by the Jakarta Post as saying on Wednesday.

          However, it seems that the government would like to rebuild residents' houses rather than relocating them.

          Social Affairs Minister Salim Segaf Jufri said that locals living on the slopes of Mt Merapi should not  be relocated as a result of the volcano's activities.  "People living around Mt Merapi already understand (the volcano's conditions) so that there is no need to relocate them," the minister said after inspecting a refugees evacuation center (TPA) in Muntilan subdistrict, Magelang district, on Tuesday.

         The minister said the  people living around Mt Merapi had been residing  there for years, even from generation to generation. "What remains to be done is to try to understand  Merapi's behavior where in certain conditions, when posing a danger threat, the local people should avoid the disaster, and after a disaster is over, they return again," he said.

         According to President Susilo Bambang Yudhoyono,  the conditions of the Merapi victims were different from the conditions experienced by the victims of tsunami in Mentawai Islands, where their settlements must be located from coastal areas to other places with a height of about 30 to 40 meters above the sea surface.

        Therefore, the government is even planning to reconstruct and  rebuild the houses which were destroyed by Mount Merapi eruption. Visiting a refugee site at Purwobinangun village in Seleman district, Central Java, President Yudhoyono said the government had a duty to rebuild the houses of the victims of Mt Merapi eruption.

         The president said the government would help the victims from emergency response until the reconstruction and rehabilitation process of the houses being destroyed in the disaster.

         "The government will help rebuild the houses destroyed by hot clouds from Mt Merapi, but the important thing is that the victims should feel safe first at the refugee shelters provided by the government," the president said.

         For this purpose, Yudhoyono asked local governments to finish the emergency response until Mt Merapi no longer endangered and posed a threat to the local people.

         He said that local governments should work until their duties were finished so that the locals could return to their respective homes. "You should not be negligent. You should finish your tasks until the end of Merapi's activities, until our brothers could return to their respective places," the president said.

          After the end of the emergency response the local governments still have to continue working on the rehabilitation phase and clean places covered by volcanic ashes.

         "Usually there is blessing in the form of soil fertility where locals could capitalize on," he said.

         In the meantime, on Wednesday afternoon, Mt Merapi erupted again which was described as three times bigger than that on October 26 last week. Following the eruption, head of the Geological Disaster Mitigation and Volcanology Center, Surono, said his side would propose the extension of the danger zone  of the world most active volcano.

         He said that the danger zone should be extended from 10 km to 15 km from the mount's peak. If the danger zones are expanded it would cover some of the refugee camps.

         However,  Sri Sultan Hamengku Buwono X said there was no decision yet to move Merapi evacuees in Umbulharjo, Kepuharjo and Glagaharjo to safer places.  "Indeed the head of the Geological Disaster Mitigation and Volcanology Center, Surono, has said that the safety zone would be expanded up to 15 kilometers away from the peak. However it was  still a mere proposal which still has yet to be discussed further with the ministry of energy and mineral resources in Jakarta," the governor of Yogyakarta province where part of the Merapi mountain is located said at the Merapi Disaster Main Command Post here on Wednesday evening.

         He said until now no evacuee had been moved from the three evacuation centers yet.

         The Volcanology and Geological Disaster Mitigation Agency has said it would expand the safe zone from 10 kilometers to 15 kilometers away from the mountain's peak.  
    The mountain erupted again on Wednesday evening and at 2.44pm it spewed huge hot clouds of ash for more than an hour as far as nine kilometers away.

         "We have decided to expand the zone to cover evacuation centers because it was reported the flow of hot clouds had now gone quite far," Surono said.

   
(T.A014/a/H-NG/a014) 04-11-2010 00:11: