AmCham Update
AmCham Update Vol. 2 #37
BI Growth Down, PPKM Continues, Foreign Debt OK, DFC Looking for Applications
Apr 21, 2021 | AmCham Indonesia


BI Lowers Indonesia Growth Forecast

In a further reflection of the continuing impact of Covid-19, Bank Indonesia (BI) has lowered its 2021 economic growth forecast to 4.1-5.1 percent, down from 4.3-5.3 percent. Indonesia’s economic growth is supported by improvements in exports (especially crude palm oil, metal ores, iron, steel, and motor vehicles), investment, as well as the ongoing fiscal stimulus. This corresponds with the constantly increasing Purchasing Managers’ Index (PMI), while vaccination and compliance to health protocols support domestic consumption. However, private consumption and retail sales to March were relatively limited, due to the public’s restricted mobility.

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Micro PPKM Extended in Jakarta and Other Regions

The government has extended micro restrictions on community activities (PPKM) until May 3 in Jakarta. The extension is due to the increasing number of active Covid-19 cases. Jakarta health service head Widyastuti said active cases had increased significantly to 6,924 on April 20 from 6,075 on April 5.

Micro PPKM, which is entering its sixth phase, has also been expanded to West Sumatra, Jambi, Bangka Belitung Islands, Lampung and West Kalimantan. Coordinating Minister for the Economy Airlangga Hartarto, who is also head of the national economic recovery and Covid-19 response team, said micro PPKM is having a positive impact on the handling of the pandemic. 

According to government figures, active cases as a percentage of total cases reached 16 percent in February, while on April 18 they were at 6.6 percent. The positivity rate of those tested for the virus has also dropped from 29.42 percent in February to 11.2 percent this month, still above WHO targets. The hospital bed occupancy rate is now 34-35 percent on average, and no province has a rate above 60 percent.

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US DFC Calls for Distributed Renewable Energy Applications

The US International Development Finance Corporation (DFC) is calling for proposals for distributed renewable energy (DRE) investments. DFC will commit $100 million to support the financing of three to 10 chosen DRE investments, particularly those located in countries eligible for DFC project support, with a special focus on low and lower-middle-income countries.

Companies may apply for the following investment types provided by DFC: equity financing, debt financing, and political risk insurance, as well as additional support for feasibility studies and technical assistance. DFC’s focus in the renewable energy sector is to help vulnerable populations, particularly those in low-income and middle-income countries, to attain a prosperous future by developing robust, sustainable renewable energy and electricity access systems led by private investors.

Proposal submissions are due on June 18, 2021. To participate, companies must submit an online application through the DFC Forms System and select the type of form that corresponds with their desired investment type. Please include in the description that you are responding to the Distributed Renewable Energy Call for Applications. You must also provide a business plan with details of your project or company, using the template provided here.

The DFC will host a virtual question and answer session on May 19. Questions may be submitted to [email protected] until May 7. For more information, find attached below.


Indonesia’s Foreign Debt under Control: BI

Indonesia’s foreign debt is under control, says Bank Indonesia. As of February 2021, it was $422.6 billion, an increase of 4 percent year-on-year (YoY), and higher than January 2021 which saw growth of 2.7 percent YoY. Indonesia’s debt-to-GDP ratio as of February 2021 was 39.7 percent of GDP, slightly higher than January at 39.6 percent. The figure, while somewhat high, is far from the legal limit of 60 percent of GDP. Some 89 percent of Indonesia’s total foreign debt is long-term.

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AmCham Cares: Starbucks

All Starbucks stores in Indonesia will gradually replace the current plastic cups and lids with recycled plastic cups and lids (rPET), as part of the Greener Nusantara initiative. Incorporating recycled material into the supply chain will eliminate the equivalent of over 200,000 kilograms of plastic per year across over 460 stores in Indonesia. Reaffirming the company’s commitment to be a resource-positive company, Starbucks will become the first major food and beverage retailer in Indonesia to switch completely to recycled plastic.

Starbucks initially launched the rPET containers in Indonesia in 2018 through the Greener Nusantara initiative in Bali. In 2019, the initiative was extended by replacing plastic straws with paper straws in Labuan Bajo, Lombok, and Bandung, gradually followed by all stores across Indonesia. In 2020, it eliminated over 30 million straws through the introduction of the strawless lid for iced beverages. The shift to rPET plastic cups and lids will further contribute to plastic waste reduction. All Starbucks stores also use recycled content packaging such as paper shopping bags, napkins, and cup sleeves.

Starbucks continues to explore innovative ways to reduce single-use plastics and waste in stores throughout Indonesia, since the launch of the Bring Your Own Tumbler program over 12 years ago. 

International Aviation Industry to Start Recovery in 2023

A survey by the Indonesia National Air Carriers Association (INACA) and Padjadjaran University estimates the international aviation industry will start to recover at the end of 2023 and be back to pre-Covid levels by 2026, while domestic flights will start their recovery in early 2022 and be back to normal by 2024. The prediction takes into consideration health aspects related to vaccine regulation and distribution.

Minister of Transportation Budi Karya Sumadi has called for collaboration between the airlines and world aviation organizations such as the International Civil Aviation Organization (ICAO) and the International Air Transport Association (IATA) to boost recovery. 

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Cabinet Reshuffle Talk Intensifies

Reports that President Joko Widodo is to announce a cabinet reshuffle have intensified. It has been claimed President Joko will replace around six positions in his cabinet.

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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.

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Now is the Time to Join AmCham!

Now is the Time to Join AmCham!

We offer a full slate of meetings, events, and information for 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!

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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.




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.

AmCham Update is AmCham's regular newsletter on developments related to the pandemic crisis and other issues 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