$500m ADB Development Loan, Hotel Groundbreaking in Nusantara, Jokowi Forms Export Task Force, EV Charging Station Permits Eased, JETP Investment and Policy Plan
Sep 27, 2023
$500m ADB Loan to Support Indonesia’s Development
The Asian Development Bank (ADB) has approved a $500 million loan to support Indonesia’s development agenda and reform priorities, aimed at creating an enabling environment for investment, easing trade barriers, and upscaling enterprises.
The success of the first subprogram, approved in October 2021, serves as the foundation for the accomplishments of this second of three subprograms of the Competitiveness, Industrial Modernization, and Trade Acceleration Program (CITA). The first program focused on accelerating Indonesia’s economic recovery from the Covid-19 pandemic by supporting reforms in pushing ease of doing business and attracting investment.
Policy reforms under the program will help Indonesia attract more investment, including in green and sustainable businesses, ease trade barriers, and empower local enterprises, said ADB Country Director for Indonesia Jiro Tominaga.
As agreed under subprogram 2, the Indonesian government has taken various actions to improve the investment climate to attract more low-carbon investments. Foreign investment for the production of electric vehicle batteries has been approved, with the signing of five high-value contracts expected to create at least 49,000 job opportunities.
Indonesia is working toward achieving high-income status by 2045, with the anticipation its annual GDP must grow by at least 6.0 percent, surpassing the pre-pandemic average of 5.3 percent. Jiro emphasized the need for ongoing structural reforms to stimulate investment, job creation, and trade.
Nusantara Consortium Holds Groundbreaking Hotel Project
The Nusantara Consortium held a groundbreaking ceremony for its $1.3 billion five-star Nusantara Hotel project in the new capital city on Sep 21. The Consortium, led by Agung Sedayu Group Chairman Sugianto Kusuma, is a group of local Indonesia conglomerates consisting of Agung Sedayu Group, Indofood, Sinar Mas, Pulau Intan, Adaro, Barito Pacific, Astra International, Mulia Group, and Kawan Lama Group.
President Joko Widodo attended the ceremony, thanking the group for taking the time to visit the new capital and invest in the city, and said the presence of these powerful conglomerates in Nusantara will increase confidence in the city going forward.
Government efforts to encourage investment in Nusantara led to the revision of Law 3/2022 concerning the new capital, resulting in the addition of Article 16A which provides business use rights (HGU), building use rights (HGB), and use rights for two periods of 95 years each, effectively granting stakeholders a 190 year land lease.
The government hopes the generous land lease will push private companies to pursue large-scale projects, with Agung Sedayu Group and Pulau Intan Group undertaking mixed-use development projects such as malls and office buildings, and other companies on industrial, commercial areas, and public infrastructure.
President Joko Widodo has formed a National Exports Acceleration Task Force, aimed at mitigating the effects of the global economy and geopolitical dynamics on national exports and Indonesia's trade balance. It will be responsible for formulating an adaptive and responsive export policy, determining integrated and collaborative export strategies, and coordinating with relevant ministries, agencies, regional governments, and associations.
The steering committee will led by the Coordinating Minister for Economic Affairs and consist of 11 other ministers, and the Chair of the Indonesian Chamber of Commerce and Industry (KADIN). The execution committee members will be determined by the Coordinating Minister under Presidential Decree (Keppres) 24/2023 and will be responsible for coordinating policy implementation, and strengthening stakeholder access to export funding and insurance services.
Gov't to Make EV Charging Station Environmental Permits Easier
The Ministry of Energy and Mineral Resources plans to ease the process for businesses to obtain environmental permits for Public Electric Vehicle Charging Stations (SPKLU), Director of Electricity Engineering and Environment at the Ministry Dwi Nugroho said. Previously, the development of EV charging stations was considered high risk, but it is now considered low-medium risk.
Businesses will only need to send all information and requirements to the AMDALnet Online Single Submission (OSS) system to be able to secure SPKLU environmental permits, and the system will automatically edit the necessary documents.
The Directorate of Engineering and Environment at the Ministry has recorded 842 SPKLU units in 488 locations across the country, most managed by state electricity company PLN.
JETP Comprehensive Investment and Policy Plan Ready in Oct
The government aims to release the Comprehensive Investment and Policy Plan (CIPP) document for the Just Energy Transition Partnership (JETP) program in October, as it is still selecting projects to be included in the plan, Deputy for Infrastructure and Transportation Coordination at the Coordinating Ministry for Maritime Affairs and Investment Rachmat Kaimuddin said.
JETP funds are crucial to achieve Indonesia’s emission reduction target by 2030. The CIPP document will be used to set just cooperation on energy transition by outlining clear financing mechanisms. Previously, the document was targeted for release in August.
Siloam Hospitals Group launched an online ordering service for laboratory and radiology tests which can be ordered anytime and anywhere in the palm of your hand on Sept 25. This service was launched to reach out to an increasingly tech-savvy society and make it easier for people to access health services easily and quickly, because with online booking, patients can come directly to the hospital and enter the express queue, reducing waiting time.
The internet penetration rate in Indonesia has grown by around 14 percent in the last five years and reached 78 percent by 2023, connecting more than 215 million people, according to research from Asosiasi Penyelenggara Jasa Internet Indonesia (APJII). In addition, based on data from the World Bank, the average Indonesian spends approximately eight hours a day accessing the internet.
With the growing digital consumption in Indonesia, Siloam Hospitals Group continues to invest in its digital service platform. In 2018, it launched the MySiloam mobile digital app. The app is continuously being developed to create a seamless patient journey in Siloam Hospitals, starting from making a doctor appointment, changing schedules, ordering a medical check-up service, making payment in the app, to implementation of Electronic Medical Records. To further complete its health services, Siloam has added an online booking feature for laboratory and radiology services.
This new service has been connected to 41 Siloam Hospitals to accommodate patients who want a laboratory and radiology check-up with international standard, and is present in 23 provinces where Siloam is located. People can directly order laboratory and radiology examination services through the MySiloam app or the website www.siloamhospitals.com.
"Patients who want to do diagnostic tests now do not need to bother coming to Siloam Hospital to register, but can order laboratory and radiology tests through our application or website," said Dr Laura Leandra Setiawan, General Manager of Patient Engagement at Siloam Hospitals Group.
"This service has also been integrated with Siloam's digital medical record system so that test results can be viewed through the MySiloam application. By making it easier for patients to access diagnostic tests, we hope to reach more patients and make the treatment experience easier and more comfortable."
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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.