AmCham Update
AmCham Update #94
Digging into Labor Changes, Economic Woes, Buying Vaccines, Prabowo US-Bound
Oct 19, 2020 | AmCham Indonesia

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AmCham, SSEK Analyze Omnibus and Labor for Members

AmCham Indonesia and SSEK Legal Consultants joined forces for a virtual event on Oct 14 to discuss the labor provisions under the recently passed Omnibus Job Creation Bill.

The event – made available to all AmCham members – featured presentations by labor law experts Stephen Igor Warokka and Indrawan Yuriutomo from SSEK. The two seasoned employment attorneys gave comprehensive analysis of the labor related sections of the Omnibus Law.

They compared specific pre-existing labor laws amended by the Omnibus Law and also several new provisions. They also explained the possible impacts on industry through changes on job training, outsourcing, severance pay and expatriate employees.

Nearly 100 people attended the lively session, throughout which Stephen and Indrawan clarified sector-specific questions. So popular were the duo that it was broadly agreed a follow up session to discuss other specific areas of the Omnibus Law should be held in the near future.

CLICK HERE FOR THE SLIDE PRESENTATION MATERIAL


DPR Submits Omnibus Law Draft to Jokowi

The House of Representatives (DPR) submitted a draft of the Omnibus Law on Job Creation to President Joko Widodo yesterday, Oct 14. The 812-page draft regulation was finalized for revision on Oct 13 after being passed at the DPR Plenary Meeting on Oct 5.

The Law, which has stirred controversy nationwide, has fluctuated in the number of pages in the draft circulating to the public. However, Deputy Chairman of the DPR Azis Syamsuddin said this was due to the process of correcting the formatting. He also confirmed that the final 812-page Job Creation Law draft will officially become public property.

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Indonesia's Economy Will Contract 1.5%: IMF

Based on the World Economic Outlook (WEO) report, the International Monetary Fund (IMF) predicts Indonesia's economic growth will contract by 1.5 percent in 2020, but will reverse direction to strengthen to 6.1 percent in 2021. Economic growth is expected to return to the yearly average level of 5.1 percent in 2025. 

The IMF projects Indonesia’s economy will stabilize at a moderate level compared to the top five countries in Southeast Asia. This sentiment is also consistent with the gradual provision of Indonesia's fiscal stimulus in 2020.

The IMF said the prospects for economic growth in developing countries continues to deteriorate due to the ongoing spread of COVID-19, the number of active cases impacting the health sector, the negative impact on critical sectors, and the increasing dependence on external finance including remittances.

The IMF predicts global economic growth will experience a 4.4 percent contraction in 2020 and is projected to return to a positive growth rate of 5.2 percent in 2021.

Related link:


Indonesia Makes Deal to Buy 100m Vaccine Doses

Indonesia has made a deal for 100 million doses of COVID-19 vaccines from United Kingdom-based pharmaceutical company AstraZeneca for delivery next year, Foreign Minister Retno Marsudi said from London on Oct 14, according to The Jakarta Post.

The move makes clear the country is not relying on its heavily touted domestic vaccine development efforts to protect the population but is aggressively entering the international market.

Retno and State-Owned Enterprises Minister Erick Thohir led a delegation on a two-day trip to meet with various stakeholders, including executives from AstraZeneca, who signed a Letter of Intent (LOI) with the Indonesian Ministry of Health on the procurement of their COVID-19 vaccine candidate.

Retno and Erick embarked on a similar mission to China in August to secure supplies of potential COVID-19 vaccines from several Chinese vaccine producers, including Sinovac and Sinopharm, setting up a future stockpile of nearly 300 million doses until the end of next year.

Also in August the two visited the United Arab Emirates to hammer out a deal between state-owned Kimia Farma and Indofarma, and Group 42 (G42) Health Care, an artificial intelligence-based Emirati company that is in involved in research, development and distribution of COVID-19 testing and treatment applications.

The government is banking on the roll-out of COVID-19 vaccines to put a stop to the viral outbreak in the country and has begun to stockpile potential vaccines despite not having any real assurances of their proven efficacy or potency. Mitigation efforts in Indonesia have fallen far short of stopping the virus.

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AmCham Cares: North Jakarta Intercultural School

North Jakarta Intercultural School houses Benevolent Badaks, Caring Cicaks, Generous Garudas, and Openhanded Orangutans, have been helping local communities near the school by fundraising to pay for sembako food staples for those most affected by the current financial situation.

On May 19, NJIS families distributed 530 sembako packages to community representatives from mosques, churches, nearby villages, taxi drivers, and security guards, and the remainder went to nearby old people's homes.

The school’s vision is to “Develop future leaders with the wisdom and passion to enact change,” and it hopes through this activity, NJIS students have developed a greater understanding of the conditions under which many people in the community are living and some strategies that might help improve those conditions.


PERSI National Seminar and Indonesia Hospital Fair 2020

The Indonesia Hospital Association (PERSI) invites companies and stakeholders in the health services, pharmaceutical and medical devices industries to participate in the annual PERSI National Seminar and Hospital Fair, to be held online Oct 26 to Nov 1. Under the theme “Patient Safety,” the series of events will include seminars, workshops, industrial symposium, virtual hospital fair and awards. More information to participate and sponsorship opportunities can be accessed in the attachments below.

CLICK HERE FOR MORE INFORMATION


Indonesia’s Reform Package Boosts Growth Prospects

The passage of the Omnibus Job Creation Law marked an improvement in the business climate that is expected to result in increased competitiveness for Indonesia. The law is intended to help make it easier to do business in the country by simplifying bureaucracy, simplifying the land acquisition process, reducing restrictions on foreign investment, relaxing labor laws, and providing more incentives to free trade zones, according to Fitch Ratings.

The Law will improve Indonesia's long-term economic growth. Faster growth will have a positive impact on the country's public debt, increase fiscal inflows, and narrow the debt-to-GDP ratio. These reforms will also allow Indonesia to take advantage of changes in global manufacturing supply chains so it does not rely on commodity exports and portfolio flows to help with its balance deficit.

Although Indonesia’s Ease of Doing Business ranking has improved in recent years, it ranks 73 out of 190 countries in 2020, which is still below average for “BBB” rated countries. This implies it may take time to see the reform package make any significant change.

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COVID-19 Numbers Fluctuate Under Luhut

One month after being instructed by President Joko Widodo to reduce COVID-19 case numbers in nine provinces, the efforts of Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan have seen mixed results. Overall fortnightly case numbers in the nine areas have fallen from 47,615 from Sept 15-28 to 38,519 from Sept 29-Oct 12. Declining cases have been seen in West Java, South Kalimantan, South Sulawesi, North Sumatra, Bali and Papua. However, in the same period there have been increases in Jakarta (16,240 to 16,835) Central Java (4017 to 4710) and East Java (4743 to 4921). 

Across the same time period, the total death toll in the nine regions dropped from 1,177 to 983, however, there was an increase in West Java, which saw 149 fatalities compared to 91 in the previous two weeks. The total recovery rate across the region decreased, falling from 35,004 to 34,972 in the previous fortnight.

Luhut is pushing a targeted testing and tracking strategy and warns of a probable spike in case numbers at the end of October due to a long holiday. Advisor to the Minister Monica Nirmala further stressed the importance of the track and trace methodology in breaking chains of transmission, saying that up to 80 percent of infections are caused by 20 percent of the population.

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Prabowo’s US Travel Ban Lifted for Pentagon Trip

Indonesian Minister of Defense and retired Suharto-era general Prabowo Subianto has had a two decade long US travel ban lifted to facilitate a trip to Washington, DC, to meet top Pentagon officials, at the invitation of US Defense Secretary Mark T Esper.

As commander of Indonesia’s special forces in the late 1990s, Prabowo was later discharged from the army for ordering the kidnapping of student activists opposed to the rule of his then father in law, President Suharto, and has been accused of overseeing atrocities and human rights abuses in East Timor. He was never formally charged and has subsequently run in four presidential elections, including twice against current President Joko Widodo.

Read the story:


Support Independent Journalism: Subscribe to The Jakarta Post

In these difficult times, our hometown English language newspaper, The Jakarta Post, is more important than ever. Given the difficulties of physical circulation and the economic slump, the Post needs to boost its online subscribers – a goal we heartily support at AmCham Indonesia. Quality English language news is vital for our businesses, our home offices and the flow of information out of Indonesia. It is for this reason, that we are urging all of our members and readers to subscribe to JP! Information is what will help get us through this crisis. Below is information about how to sign up.

JP Premium Digital Subscription Packages

https://www.thejakartapost.com/packages

Monthly subscription – Rp 50,000

Yearly subscription – Rp 600,000


We Still Need Your Support to Shelter the Front Line

AmCham Indonesia and Habitat for Humanity have joined forces in an initiative called Sheltering Those Who Care for Us, a program to provide temporary quarters in hotels for Indonesian medical workers during the COVID-19 pandemic. Our program has helped not only medical workers in Jakarta, but also Tangerang and Surabaya; we are now planning to expand to Sulawesi.

With the COVID-19 pandemic still spreading, medical workers are working a lot harder than before. In these difficult times, they often cannot go back home for fear of infecting family members or being rejected by their local communities. As a result, they are forced to sleep in hospitals without a proper bed, also increasing the possibility of getting infected.

By donating, we will increase the overall capability of Indonesia to treat COVID-19. Habitat will match individual hospitals with hotels on an as-needed basis.

Your support is needed more than ever.

CLICK HERE FOR MORE FLYER ON HOW TO DONATE


Now is the Time to Join AmCham!

Now is the Time to Join AmCham!

We are continuing with a full slate of meetings, events and information offered to our community online. But we can only do this through the support of our members. If you are not yet an AmCham member, please join now!

AmCham Indonesia is open to all companies with an interest in US business relations and we have many non-American members. We are a community and we welcome you!

Reach us at [email protected] or click below!

JOIN AMCHAM

 


AmCham Office and Events

AmCham Office and Events

The AmCham Office is on work from home status and all face-to-face meetings and events have been postponed. We are having a number of meetings online using the Zoom platform. You will be notified of virtual meetings as they are scheduled.

 

 


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What is Your Company Doing on COVID-19?

Please let us know what measures your company may be taking in the form of donations and other assistance to help Indonesia during this time of confusion and concern. Contact [email protected] with your news. We would like to publicize the ways that our AmCham companies are pitching in.


Stay well

We urge you to send us press releases and other information that we can pass on to the broader AmCham community. If you have items of interest, please email material to [email protected]. Follow this link to information provided by the US Embassy

Stay safe, call a doctor if you have a high fever, cough, or difficulty breathing. Stay healthy above all else.


COVID Update is AmCham’s regular newsletter on developments related to the pandemic crisis in Indonesia. It is edited by AmCham Managing Director A Lin Neumann and written by the AmCham Staff. Paul L Goddard is the Managing Editor

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