A beautiful design of pendant pearl fromLombok (Nico Adam)

Content :

H.E. M. WAHID SUPRIYADIAmbassador Extraordinary and

Plenipotentiary

JOKO SANTOSOMinister Counsellor/

Political Affairs

NICO ADAMFirst Secretary/

Economic Affairs

M. ARIF HIDAYATULLAHSecond Secretary/Economic Affairs

ABDI SATYA UTAMASecond Secretary/

Information, Social and CulturalAffairs

HANAN HADIThird Secretary

Protocol & Consular Affairs

SUKARTONO DALILAdministration Officer

ASDEDIAdministration Officer

THE EMBASSY OF THEREPUBLIC OF INDONESIA

Zone 2, Sector 79, Villa No. 474Sultan bin Zayed Street (Street-

32), Al Bateen AreaP.O. BOX 7256

Abu Dhabi, United Arab EmiratesPhone : +971 2 445 4448Fax : +971 2 445 5453

E-Mail :indoemb@emirates.net.aekbriabd@indonesianembassy.aeWebsite: www.indoemb.org/kbri/

Design Graphics and Layout:Nico Adam

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Dear Readers,

No doubt Indonesia is also affected by global economiccrisis. How ever the government and businesses haveagreed to find a solution that could mitigate the impactof the economic slowdown.

President SBY said that he hoped the country economywould still be able to grow by 4,5% next year despite asignificant slowdown of demand for Indonesia’s product from traditional exportdestinations, such as US, Japan, and Europe.

That’s way in this edition I would try to write and upload the news aboutwhat the government and businesses want do to minimize the impacts,such as giving incentives, looking for new market and encouraging more

investments.

I hope that all articles could give you wide understanding of how Indonesiadeals with this unavoidable crisis. Finally, your comments and suggestionsare highly appreciated.

Regards,

Nico AdamEditor in Chief

Editor’s corner

• India, UAE firms to build $.4 billion smelter .......... 3• Government preparing Rp50 trillion to stimulate

growth ......................................................................... 4• RI exports still grow by finding new markets ....... 5• RI urged to look to Middle East for investment ... 6• Indonesia to open new trade promotion centers

abroad ........................................................................ 7• South Korea buys Indonesian aircraft for

coastguard ................................................................. 8• Selected industries, commodity producers to

get tax break ............................................................. 8• Lombok an Ancestor’s Heritage .......................... 9• “GOD TEARS” from South Sea .................................10

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An India-based aluminumproducer and acompany from the

United Arab Emirates (UAE) planto spend US$4 billion to build asmelter and supportinginfrastructure, including a powerplant, in Tanjung Api-api, SouthSumatra.

National Aluminum CompanyLtd (NALCO), India’s largestaluminum maker, and UAE-based Ras Al Khaimah Mineralsand Metals Investment FZ LLC(RMMI) Friday (19/12) signed anMoU to form a joint venture tobuild the facil ity which willprocess alumina into aluminum.

“We will begin the constructionsoon and expect the smelter tobegin its operation in 2013,”NALCO’s finance director B.L.Bagra told reporters after thesigning ceremony.

Bagra said that $2.5 billion of theplanned investment would bespent on the smelter and theremaining $1.5 on the powerplant, a port and railway.According to Bagra, the smelter

will be designed to process 1million tons of alumina a yearand is expected to produce 0.5mill ion tons of aluminumannually. The alumina will beimported from India whichproduces about 2.1 million tonsof alumina per year.

Bagra said NALCO and RMMIdecided to build the smelter inIndonesia instead of in Indiabecause Indonesia has betterquality coal and cheaper miningcosts which will cut the costs forthe power plant.

“Aluminum smelters require a lotof electricity. The energy sourcescan be coal, hydro, gas, ornuclear. We have a lot of energyresources in India, but still we findit makes sense to put our powerplant and coal mine here inIndonesia (where) electricity willbe relatively economic. So thecost of production should bemore competitive,” Bagra said.

The captive power plant willhave a capacity of 1,250megawatts and will need 5million tons of coal a year. Bagra

said NALCO and RMMI are in talkswith several domestic coalproducers to secure coalsupplies.

Of the $4 billion investment, twothirds will be financed by loans.RMMI’s director NaveenChandralal said the com-panywould contribute 24 percent

INVESTMENT

India, UAE firms to build $ 4 billion smelter

His Highness Sheikh Saud Bin Saqr Al Qasimi,Crown Prince and Deputy Ruler of Ras AlKhaimah with the President of Indonesia, SusiloBambang Yudhoyono.

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obtained not because of failureto absorb the 2008 budget butbecause of increase in staterevenues.

The president said that staterevenues in 2008 increased to alevel which was 10 percent overthe tax payment target.

Therefore, the presidentexpressed his satisfaction over the2008 state budget performance.

Yudhoyono said that about 99.6percent of the 2008 state budgetwere spent so that there was adifference of Rp4 trillion betweenstate revenues amounting toRp981 trillion and expendituresvalued at Rp985 trillion.

Thus, the 2008 budget deficitbecame smaller, namely 0.1percent of the Gross DomesticProduct (GDP), than thetargeted 2.1 percent of the GDP.

The president said that the 2008state budget performance, as itwill reported by the financeminister on January 1, 2009,would be used by thegovernment as an indicator tomeasure its preparedness to facethe 2009 global financial crisis.

President Susilo BambangYudhoyono has said thatthe government is

allocating Rp50 trillion ($.5 billion)in stimulus to generateeconomic growth andanticipate the impact of globaleconomic crisis in 2009.

Speaking to a press conferenceon the sidelines of his visit toRagunan Zoo, the president saidthat Rp38 trillion ($ 3.8 billion) ofthe stimulus fund came from the2008 unspent budget and Rp12trillion ($. 1.2 billion) from the 2009state budget‘s reserved funds.

“The Rp38 trillion plus Rp12 trillionfrom the reserved funds is veryuseful for stimulating economicgrowth and overcoming theimpact of the world economiccrisis,” the president said.

He said that in anticipation ofthe global economic crisis whichwas expected to peak in 2009,the government was formulatingvarious economic growth stimuliin order to guarantee thedevelopment of the real sector.

Previously, the head of state saidthat the government wouldalways adjust its economicstimulus package to the state‘sfinancial capability so that itwould not pose a new burdenin the future.

He said that the 2008 unspentbudget of Rp38 trillion whichwould be used for stimulatingeconomic growth in 2009 was

equity to the project and NALCOwould contribute 76 percent.

Bagra said NALCO was lookingforward to share its equity in theproject with local investors. Hesaid that NALCO had been intalks about this with Indonesia’smining company PT AnekaTambang (Antam) and others.

Bagra added NALCO alsoplanned to offer its equity in theproject through an initial publicoffering which will be held whenthe project is nearing thecommissioning stage, or in abouttwo years from now.

“We may list it in the Jakartastock exchange or in Singapore,”he said. Alwi Shihab, PresidentSusilo Bambang Yudhoyono’sspecial envoy to the Middle East,said the MoU showed thatIndonesia was still attractive toforeign investors. But, he added,all parties needed to work hardto bring the MoU to the stage ofrealization.

“We hope the MoU would not(simply) be put on the shelfalongside so many MoUs signedin the past,” Alwi said.

Bagra said NALCOacknowledged that the currentglobal economic crisis was notfavorable for commodities,including aluminum.

But, “The crisis and low price maynot last longer than two or threeyears. This is the required time forsmelter construction. We shouldbe able to finish the project intime, so that we will be readywhen the market recovers.”

Government preparing $ 5billion to stimulate growth

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RI exports still grow byfinding new markets

Indonesia’s exports of non oiland gas commodities will beaffected as the global

economic downturn slashesdemand, although exportscould sti l l grow by up to 8percent this year as firms diversifyexport destinations.

Trade Minister Mari Elka Pangestusaid when delivering herministry’s assessment on exportprospects for 2009 that non oiland gas exports would grow bybetween 4.3 percent and 8percent.

Those figures are much lowerthan the annual average 18.3percent export growth achievedbetween 2003 and 2007.

Even for 2008, when the globalslowdown began to hit towardsthe end of the year, Mari saidnon-oil and gas exports were stillestimated to grow by 18 percentfor the year, well above the 14.5percent target.

“The estimated growth of 2009’snon-oil and gas exports uses amacro model and is based onassumptions about global tradegrowth, rupiah depreciation(against the US dollar) and (thevolatility of) commodity prices,”she told a conference.

Mari said the growth of non-oiland gas exports would muchdepend on the growth of world’seconomy. The country’s non oiland gas exports would grow by4.3 percent, 6 percent, or 8

percent if global trade grew by3.4 percent, 3.6 percent, or 4.4percent, respectively. Non-oiland gas exports contributeabout 80 percent to the country’stotal exports.

Mari also said the projectedgrowth had taken into accountgovernment policies inresponding to the globaleconomic downturn and theireffectiveness. “Of the projected8 percent growth, 3 to 4 percentwill be attributable togovernment policies inanticipating (the impact of) thecrisis,” she said referring to thegovernment’s Rp 50 tri l l ion(US$4.85 bil l ion) stimuluspackage.

“The growth would be lowerthan projected if these policieswere excluded, or end up withfailure.” Despite the fairly “small”growth projected in non-oil andgas exports this year, she said thecountry would still be able tobook a surplus as imports wouldcorrespondingly follow thedecline in exports.

“Our (2009) trade balance willremain in surplus, with the sameamount, or lower than that webooked in 2008,” said Mari.

In an effort to help realize theprojected 2009 growth, she saidthe government would seek newexport markets since Indonesia’smain traditional export markets,including the United States, theEuropean Union and Japan haveall been severely affected by thecrisis. New markets wouldinclude South Africa, Kenya,Nigeria, Egypt and Middle Easterncountries, she said. “Iraq and Iranhave actually the potential tobecome our new markets.”

She said the government wouldredirect the country’s top 10goods categories, sales of whichhad begun dropping significantlyin main export markets, to thenew markets. The goodscategories included furniture,textiles and garments, crudepalm oil, construction materials,fisheries and shrimps andfootwear.

TRADE

Export and import have a tendency to decline, despite high importgrowth due to strong economic growth

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INVESTMENT

Middle Eastern investorsview Indonesia as acountry with plenty of

investment opportunities, butwhere a lack of promotion byboth the government andprivate sector has resulted ininvestment money going toother nations in the region, suchas Singapore, Malaysia, Pakistan,China and India.Mumtaz Khan, chairman andCEO of EMP Bahrain, said the GulfCooperation Council (GCC) —which groups Saudi Arabia,Bahrain, UAE, Kuwait, Oman andQatar — was now looking toAsia for diversification and long-term investment.

In Indonesia, most Middle Eastinvestors were interested ininvesting in the infrastructuresector, including power andwater, mines and energy, andtransportation projects. Manywere also interested in investingin the natural resources,

agriculture and finance sectors,Mumtaz told The Jakarta Post onthe sidelines of the SecondIndonesia Investment Forumhere.

“Tapping these major fundingsources for high-priority projectsis the key to securing much-

needed foreign investment,” hesaid.

Indonesia, as the country withthe largest Muslim population inthe world, stood a good chanceof becoming the primaryrecipient of funding from Muslimcountries. However, he added:“”Indonesia tends to beg forinvestment from the Westerncountries, ignoring the hugepotential that exists in the Gulfcountries.”

Accordingly, Indonesia neededto aggressively market itself inplaces such as Riyadh, Jeddah,Dubai, Abu Dhabi, Doha,Muscat, Kuwait and Bahrain.“These are the places wherethere are bil l ions of dollarswaiting to be invested. I wouldsuggest that Vice President JusufKalla and other senior officialslead missions to these places,”Mumtaz said.

RI urged to look to MiddleEast for investment

Construction sector already start to invest in Middle East. Indonesian Minister of Public Works, H.E. DjokoKirmanto along with H.E. Alwi Shihab and H.E. Wahid Supriyadi visit Abu Dhabi Chamber of Commerceand Industry (ADCCI), received by Board Member of ADCCI, H.E Khalfan Saeed Jumaa Al Kaabi andthe Director General of ADCCI, Mr. Ahmad Hassan AI Mansouri.

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“There is a trend toward greaterinvestment in the Gulf countriesfollowing the recent visit by KingAbdullah of Saudi Arabia toChina, India, Malaysia andPakistan,” he said.

Meanwhile, Singapore SeniorMinister Lee Kuan Yew also visitedthe UAE and Qatar to promoteSingapore as a conduit forGCC’s investment in Asia.“Singapore and Malaysia arefast-movers in tapping theseopportunities,” he said.

GCC member countries hold 50percent of the total assets of theglobal Islamic finance market,which amount to US$700 billion.

According to Afaq Khan, globalhead of Standard CharteredBank Islamic Banking, there arecurrently over 250 Islamic fundsworldwide managing over $300bil l ion in assets comprisingequity, real estate, currency,leasing and bond funds.

EMP Bahrain, which has beenactively acting as a bridgebetween investor groups in theMiddle East and Asia, is in theprocess of setting up a $1 billionIslamic energy fund, to be basedin Dubai.

Afaq said that the establishmentof the Islamic finance industryand the creation of Islamicfinancial institutions in Indonesiawould provide opportunities forattracting more Middle Easterninvestors.

“Middle Eastern investors wouldbe more confident about theirinvestments in Indonesia if theywere channeled through suchfinancial instruments,” Mumtazsaid.

Indonesia plans to open 11new Indonesian TradePromotion Centers (ITPC)

abroad at the end of this year.

The new ITPCs are located inShanghai (China), Jeddah (SaudiArabia), Mexico City (Mexico),Chicago (the US), Busan (SouthKorea), Chennai (India),Barcelona (Spain), Lyon (France),Santiago (Chili), Vancouver(Canada) and Lagos (Nigeria).

The head of the National ExportDevelopment Agency (BPEN),Bachrul Chairi, said the decisionwas part of the country’s effortsin seeking new export marketsparticularly in those regions.

“The state minister foradministrative reform and theforeign minister have agreed tothe opening of the new ITPCswhich are expected to startoperating by the end of thisyear,” he said.

Indonesia has so far alreadyoperated nine ITPCs in businesscities like Sao Paolo (Brazil), LosAngeles (the US), Milan (Italy),Johannesburg (South Africa),

Dubai, Osaka, Sydney andBudapest (Hungary).

Chairi said the 11 countries wherethe new ITPCs would beestablished were the world’strade hubs that had high percapita income and buyingpower as well as potentials toimport products from Indonesia.

”Indonesia’s export market sharein those countries is still relativelysmall and may still be increasedwhile those countries are also agateway for exports to theirneighbors,” he said.

The ITPCs which cost Rp4 billioneach could be used as anexhibition venue for worldproducts.

He said one of the reasons forestablishing the new ITPCs inthose countries was that thosecountries generally have bigports to support exports andimports.

In the 2009 budget theIndonesian governmentallocates Rp86 billion to increaseITPCs and operate 20 others.

ITPC offices in the world this time

Indonesia to open new tradepromotion centers abroad

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South Korea has signed a 90-mill ion-dollar deal withIndonesia to buy four

transport planes for thecoastguard, officials saidTuesday.

Under the deal signed onMonday, Indonesia will deliverfour CN235-110 aircraft by 2011,the Defense AcquisitionProgramme Administration said.

“They will be used for variousmissions,” a spokesman told AFP,adding the plane, which isequipped with an advancedradar system, is already used bySouth Korea’s air force.

Yonhap news agency said thecoastguard would use theIndonesian aircraft to patrolwaters around a group of Seoul-controlled islands midwaybetween South Korea andJapan.

Called Dokdo in Korea andTakeshima in Japan, the tinyislands have for decades been aflashpoint in relations, with bothsides claiming sovereignty.

Japan claimed them in 1905 afterwinning a war with Russia. Itwent on to annex the entireKorean peninsula from 1910 untilits World War II defeat in 1945.

Seoul has taken measures tocement its claims to the islands,including staging a militaryexercise nearby. A small SouthKorean police contingent isstationed on them.

The government is set tointroduce fiscal incentivesfor selected industries and

commodity producers, aimingto boost the local economy andreduce impacts of the globaleconomic downturn.

Finance Minister Sri MulyaniIndrawati said the incentiveswould include waiving value-added taxes (VAT) andadministrative fees.

“We will select industries andcommodities based on theirability to create jobs, and we willannounce them (the selection)next week,” Mulyani said, addingthat the government hadprepared Rp 12.5 tri l l ion(approximately US$1.1 billion) forthe scheme.

President Susilo BambangYudhoyono said the government

would take the incentive fundsfrom this year’s state budget,with additional funding from the2008 budget.

South Korea buys Indonesianaircraft for coastguard

Selected industries, commodity producers to get tax break

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Visit Indonesia

Lombok an Ancestor’s Heritage

Many people claim thatWest Nusa Tenggara,one of the 27 provinces

of Indonesia, has beenunderestimated as touristdestination. Its two main islands,Lombok and Sumbawa, arecompletely bordered withimmaculate unspoiled beaches,and the little islands scatteredaround them are just asspectacular.

Stretching over an area of 20, 153square kilometers, West NusaTenggara is home to 3,5 millionpeople of many ethnic groupswho speaks score of differentlanguages and observe differentfascinating customs.

The majority of the population isstrict Muslim with a 10% of Hindu,Buddhist, Catholic, plus a varietyof Christian groups. Divided intosix regional districts, three ofthem are on Lombok, West NusaTenggara is an area of hills andmountains, with Mount Rinjani(3726 m) as the highest peak onLombok, and Mount Tambora(2850 m) on Sumbawa. Thecaldera of Mount Rinjani isrenowned for its magnificentSegara Anak, a lake of vividemerald green water.

A variety of flat sandy beachesadd touches of brilliant white tothe tropical landscape in whichthe Sasaks and Balinese ofLombok, and the Samawa andMbojo of Sumbawa continue intheir rich traditional art, craft,and cultural development.

Located strategically betweenBali to the West, Komodo Islandin the East, and Tanah Toraja tothe North-west, West NusaTenggara is an excellent startingpoint for international travel andtourism. This information is aimedto provide general informationon places of interest of WestNusa Tenggara.

Fisherman traditional boat and sunset at Senggigi Beach, Lombok (Nico Adam)

TOURISM

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The Enchanting Pearls

South Sea Pearls refers topearls from Pinctadamaxima – a large oyster also

called the silver-lip or yellow-lip(gold-lip) oyster depending onthe color of its shell lip. They areextensively cultured in areas ofthe Indian and Pacific Oceans,including Indonesia. The color ofsouth sea pearls is white togolden. Their sizes are normallylarge than 9mm, sometimes canreach 19mm. South Sea Pearl isvery precious. Its beauty andgorgeous luster honor itsreputation as “the queen ofpearls”.

The color of South Sea pearlsvaries depending on whichoyster the pearl comes from. Theoyster in Northern Australia issilver-lip oyster which tends toproduce white south sea pearlswith silver overtone. The gold-lipoyster which is commonly foundin sea area of south-east Asiaproduces yellow or creamy SouthSea Pearl. Among those colorfulsouth sea pearls, white, pink andgolden South Sea Pearls are most

valuable. Creamy one is for alower price. For their overtone,silver, pink overtone can bemore valued than overtone ofbluish-gray or green.

Central Indonesia’s West NusaTenggara Barat region containsthe rugged island of Lombok,situated just east of Bali. Lombokis known for its golden ‘South-Seas’ cultured pearls. LombokPearl farms are located in on thesouth-western coast of the island,west of the towns of SekotongTimur, Sekotong Tengah, andLembar. The Lombok pearl farmsare located within the chain of10 islands (Gili) along thenorthern side of the Sekotongpeninsula, between SekotongTimur and Bangko Bangko on thewestern tip.

Famous pearls in the worldThe Pearl of Lao-tzeThe Pearl of Lao-tze found by ananonymous Muslim Filipino diveroff the island of Palawan in 1934is the largest pearl in the world.In 1936 Wilbur Dowell Cobb wasgiven this pearl as a gift by achieftain of Palawan for havingsaved the life of his son

“GOD TEARS” fr“GOD TEARS” fr“GOD TEARS” fr“GOD TEARS” fr“GOD TEARS” from South Seaom South Seaom South Seaom South Seaom South Sea

All above are Indonesian pearl from Lombok (Nico Adam)

Pearl cultivation in Lombok, still open for investment (Nico Adam)

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International Furniture & Craft Fair Indonesia 2009

EXHIBITIONExhibition and Promotion Event

INACRAFT will be held on 22nd – 26th of March2009 at Jakarta Convention Center. Forinformation please visit www.inacraft.co.id

DISCOVER THE AGRICULTURE, EXPLORE THE FOREST,CATCH THE FISHERIES, AND CREATE BIOENERGY

AGRINEX 2009 will be held on 13th – 15th of March 2009 at JakartaConvention Center. For information please visit www.agrinex.com

IFFINA 2009

Agrinex 2009 will be held on 11th – 15th

of March 2009 at Jakarta ConventionCenter. For information please visit

www.iffina-indonesia.com

Pearl of AsiaWas found in 17th century inIndia. After the siege of Delhi itbecame the property of the Kingof Persia (present-day Iran), whoin turn gave it to ChineseEmperor Qianlong.

The Imperial Hong Kong PearlThe Imperial Hong Kong Pearlwas formed in Pinctada Maxima.The Pearl origins are unclear it isbelieved to have once belongedto the Royalty of China andPurchased by Imperial in HongKong in the 1940s

Hope pearlThe Hope pearl is a white drop-shaped freshwater blister pearl of

1,800 grains (450 carats or 4 oz).One of the largest saltwater pearlsin existence, the Hope Pearl wasfirst acquired by Henry Philip Hopein the 19th century. It is on displayat the British Museum of NaturalHistory.

Gallery

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Indonesian Ambassador H.E. Wahid Supriyadi with Mr. Hirod D. Vassanani(MD Snowhite), Mr. Abdel Shaban Mousa (Chairman Snowhite), and Mr.Alexander (Exporter) at the press conference of the opening new branchof Snowhite in Ras Al Khaimah.

Indonesian Ambassador H.E. Wahid Supriyadi and wife on the performanceof Kyaikanjeng and Emha Ainun Nadjib at the Abu Dhabi For Culture andHeritage Foundation.

Mrs. Susan Arif as a Dance Trainer and also the dancers (Indhira SarahAdam, Luna Colombini Adam, and Cesa Djoko) phose together withIndonesian Ambassador H.E. Wahid Supriyadi and his wife on theIndependence Day Reception.

H.E. Saqr Gobash Bin Saeed Gobash, Minister of Labour of UAE as aChief Guest on the Indonesian Independence Day Reception received byIndonesian Ambassador H.E. Wahid Supriyadi

Ambassador H.E. Wahid Supriyadi made a courtesy call to Ruler of Fujairah,H.H Shaikh Hamad bin Mohammed Al Sharqi.

Ambassador H.E. Wahid Supriyadi made a courtesy call to Ruler of Ummal-Quwain, H.H Shaikh Saud bin Rashid Al Mualla and Ambassadordiscussing about the tourism in Indonesia and invite His Highness to cometo Indonesia.