Good News From Indonesia

Rising commodity prices and savvy dealmaking have made it a huge year for Indonesia’s wealthiest. More than half are billionaires.

Despite recent volcanic activity, Indonesia’s star is shining bright. Its stock index has outperformed those of all other major Asian economies, up more than 50% in dollar terms so far this year. Only Mongolia’s and Sri Lanka’s markets did better. No surprise then that the country’s richest enjoyed big gains. Their total worth surged to $71 billion, up from $42 billion last year, hitting an all-time record.

In another first, more than half of the top 40 are billionaires, up from last year’s dozen. The Hartono brothers retain the top spot for the second year in a row with a net worth of $11 billion. They inherited clove cigarette maker Djarum from their father, but these days get the bulk of their wealth from Bank Central Asia, the country’s largest bank, which returned to the ranks of the Forbes Fab 50 this year.

Behind them is Susilo Wonowidjojo, the year’s biggest dollar gainer, worth $8 billion, up from $2.6 billion. His family still gets the bulk of their wealth from Gudang Garam, the country’s largest clove cigarette maker. Sixteen of the 21 billionaires made their fortunes in coal or palm oil.

We were able to identify seven new entrants, worth a total of over $8 billion. Several, including Kiki Barki of coal miner Harum Energy, debut thanks to recent initial public offerings, of which Indonesia was one of the most ­active markets in Asia. He is one of five coal tycoons to make their first appearance on this top 40 list.

The richest of all newcomers is Sri Prakash Lohia, a native Indian who is now an Indonesian citizen and controls Indonesia’s largest polyester manufacturer, Indorama Synthetics. His brother Ashoke, who is based in Thailand, is also a billionaire, as is his brother-in-law Lakshmi Mittal, who is Asia’s second-richest citizen but lives in London, where the Indonesian Lohia too has a home.

It was also a notable year for deal-making for Indonesia’s richest. Chairul Tanjung, for instance, bought a 40% stake in Carrefour’s Indonesian operations for $300 million. Peter Sondakh’s Rajawali sold its stake in cement firm Semen Gresik for $1.1 billion. The Bakrie family announced a $3 billion deal with Europe’s Rothschild family, in which it traded shares in its coal outfit for a stake in London-listed Vallar.

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The city of Palembang has long intrigued me. I am drawn again and again to this strangely unattractive but compelling riverside locale with its rich and colorful history stretching back to the seventh century.

Palembang was once the base of the Sriwijaya empire that dominated much of the western Indonesian archipelago. For more than 500 years it was a center of both trade and learning (especially Buddhist scholarship) and a vital midway point between China and India.

The Landmark of Palembang, the Ampera Bridge

Modern-day Palembang may not be quite so dominant in regional terms. However, the southern Sumatran city — the island’s second largest with a population of more than 1.5 million — is currently experiencing a mini-boom, with lots of malls, housing estates and industrial centers popping up. Palembang will also play host to the 2011 SEA Games.

Slowly but steadily, the city is emerging onto the national stage after decades of relative obscurity. The relative prominence of Palembang-born leaders in national politics — including Taufik Kiemas, Hatta Rajasa and Marzuki Ali — doesn’t hurt.

Palembang also serves as a major regional hub: a retail and entertainment center for the busy and prosperous province of South Sumatra and its eight million-strong population, not to mention visitors from as far afield as Jambi and Lampung.

Personally, I like nothing better than taking in the Rialto-like atmosphere on the riverfront, alongside the iconic Ampera Bridge, watching boats unload their wares. Last week I made a day trip to the city for a conference on entrepreneurship, at the invitation of the mayor, Pak Eddie Santana Putra.

Now, I have the concentration span of a mosquito, so I confess I was dreading the actual event. But a promise is a promise, so I turned up. To my surprise, I actually listened to most of the speeches and presentations. Normally I would be playing with my BlackBerry, but on this occasion, I ended up taking notes.

The invited speakers had real firepower. Indeed, I was quite puzzled how a city like Palembang could attract such heavy hitters — men like Dahlan Iskan, the president director of PLN, Chairul Tanjung, the founder of the Para Group, Lippo’s James Riady and the ever-dignified property magnate Ciputra.

The reception from the audience also piqued my curiosity. There were more than a thousand people assembled — many of whom were taking notes like myself. Later, I learned that the cheapest ticket for the event was Rp 300,000 ($33). The enthusiasm from the crowd was startling.

Generally, corporate figures aren’t particularly inspiring speakers. This was not the case in Palembang. The first person to take the stage — after the ever-smiling Pak Eddie — was the ebullient, gym-shoe wearing Dahlan Iskan.

Pak Dahlan has a piercing tenor and he bounded across the stage like a teenager, punching the air in enthusiasm. His presentation was energetic and enthusiastic, raising the level of excitement in the hall. His message was tried and trusted. He called on the listeners to move, to trust their instincts, to focus and then to continue on even after they’d experienced the requisite failure.

The Srivijaya Vessel, as iconic as the Phinisi

Pak Dahlan talks from experience. Having created a network of more than 200 daily newspapers, stretching from Aceh to Papua, you can feel the determination that once powered his business empire. Indeed, he ended his session with a typically Dahlan-esque flourish, telling everyone that they should get back to work and focus on the task at hand.

The Para Group’s Pak Chairul was entirely different. His baritone was sonorous, firm and reassuring as he laid out the numbers behind the republic’s current boom. His presentation was thorough and upbeat. As he spoke, the room fell silent, the audience members digesting his statistics and core conclusion: Indonesia has a spectacular future, despite problems with bureaucratic reforms and human resource limitations.

The sense of anticipation and excitement in the hall as he concluded was electric.

Palembang’s rise reflects the way in which Indonesia’s prosperity is spreading outside of Jakarta and Java. The presence of the tycoons reaffirmed that fact.

Decentralization has unleashed the energies and ambitions of millions. Indeed, the marketplace is now lively, crowded and full of energetic players. Life will never be the same again.

Source: The Jakarta Globe (Karim Raslan)

Karim Raslan is a columnist who divides his time between Malaysia and Indonesia.

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Indonesia’s credit rating may be raised by Moody’s Investors Service as growth and improving debt levels prompt upgrades of emerging markets. Stocks and the rupiah rose.

Moody’s today placed the Southeast Asian nation’s debt on review for a possible upgrade after raising Indonesia’s credit rating outlook to positive in June, it said in a statement. The company has a Ba2 grade on Indonesia’s local- and foreign- currency debt after its last upgrade of the country to two levels below investment grade in September 2009.

“Indonesia’s economic resilience is accompanied by sustained macroeconomic balance,” Moody’s said. “The economic policy framework remains increasingly well positioned to deal with evolving macroeconomic challenges and potential shocks.”

Emerging-market nations from China to Brazil and Turkey are winning upgrades or positive outlooks on their sovereign rankings, highlighting the relative strength of developing economies amid soaring debt burdens in advanced nations from Greece to Japan.

Indonesia currently shares the same rating as Turkey and Bangladesh. A one-step upgrade will rank it alongside Greece, Egypt and Colombia.

The Jakarta stock index closed up 2.5 percent to 3,619.09, rising the most among Asia-Pacific benchmark indexes, while the rupiah gained 0.2 percent to 9,019 per dollar.

Ireland’s Woes

Ireland, which became the second euro-area country to get a bailout, saw its debt rating lowered two steps by Standard & Poor’s on Nov. 23. S&P yesterday said it placed Portugal’s long- term and short-term foreign and local currency sovereign credit ratings on “CreditWatch” with “negative implications,” reflecting its inability to reduce its current-account deficit.

Moody’s raised China’s debt rating to its fourth-highest level of Aa3 on Nov. 11. A day later, S&P boosted the credit ranking of the Philippines to the highest in more than seven years.

Fitch Ratings increased the outlook on Turkey’s BB+ local and foreign currency bond ratings to positive from stable last week, while S&P said Brazil’s credit level may be raised because of its strong growth and a “well capitalized” banking sector.

S&P lifted Indonesia’s sovereign credit rating to BB from BB- on March 12, two levels below investment grade, with a positive outlook. Fitch Ratings on Jan. 25 raised its rating to one step below investment.

‘Well Warranted’

The Moody’s “move is well warranted in our view,” said Robert Prior-Wandesforde, head of India and Southeast Asia economics at Credit Suisse in Singapore. “If the country can keep inflation well contained over the coming year, then a move to investment grade beckons.”

“The review will have a positive impact on Indonesia,” said Destry Damayanti, an economist at PT Mandiri Sekuritas in Jakarta. “This affirms the confidence existing investors have in Indonesia and it will make new investors confident as well. If Indonesia is rated investment grade, it will attract foreign direct investment, not just to the financial market.”

Indonesia’s economy escaped a recession during last year’s global slowdown and its expansion has spurred capital inflows, pushed stocks to a record and lifted the rupiah to a three-year high.

“The recent improvement in Bank Indonesia’s foreign currency reserve position coupled with continuing reduction in the government’s debt burden are reducing risk perceptions and encouraging greater inflows of foreign direct investment and long-term capital,” said Aninda Mitra, lead sovereign analyst for Indonesia at Moody’s.

Interest Rates

The nation’s economic recovery “is being sustained alongside well managed external accounts and reasonably good inflation fundamentals,” Mitra said.

Bank Indonesia has refrained from raising interest rates from a record low this year, delaying an increase that could attract more funds at a time when emerging markets are luring investors away from developed economies.

Inflation accelerated in November, to an annual pace of 6.33 percent, the Central Bureau of Statistics said today, breaching the central bank’s target range of 4 percent to 6 percent for 2010 and 2011. The benchmark rate of 6.5 percent is “still relevant” for achieving the central bank’s inflation goal next year, Deputy Governor Budi Mulya said Nov. 24.

Political Risk

“Amidst growing inflows of foreign portfolio investment, monetary stability alongside ongoing policy flexibility are enabling Indonesian authorities’ to gradually deepen money markets and heighten financial absorption capabilities,” Mitra said.

The key risk to Indonesia’s rating outlook is in the country’s political system, where opposition from coalition partners has slowed government efforts to implement economic changes, Moody’s said.

“However, this has not yet impacted overall policy management capabilities or near-term economic prospects,” Mitra said. “If bank supervision is constrained by political interference or poor governance, the risk of a shock to the real economy or to the government’s contingent liabilities could rise.” (Bloomberg)

–With assistance from Novrida Manurung in Jakarta and Victoria Richards in Sydney. Editors: Sunil Jagtiani, Chris Anstey

To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net

To contact the editor responsible for this story: Chris Anstey at canstey@bloomberg.net

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PT Telkom Tbk. has caught investor attention over the past few years with its bold strategy to transform itself from a pure telecommunications giant to a multimedia company. Market analysts like the story and have pushed the stock price up to Rp9,000 over the past few weeks. Leading the charge is president director and CEO Rinaldi Firmansyah, the first outsider to lead the state-owned company.

When Rinaldi Firmansyah joined PT Telkom Tbk. as chief financial officer in 2004, he was the first outsider to be admitted to the board of directors of the state-owned telecommunications company. His first day at work was no walk in the park and he soon learned that the task before him was enormous.

The company faced some serious issues in those days. Its financial report had been rejected by the Stock Exchange and it was his job to fix the problem. An investment banker by training, Rinaldi rolled up his sleeves and got to work.

“It was a long first day and the days got longer in the first few months,” he recalls in an interview with GlobeAsia. “Sometimes I slept in the office as we used to work through the night as I also had to coordinate with New York.”

Apart from internal issues, the company also faced rising competition from new and more aggressive rivals. There are now 11 telecommunication operators and the battle for market share has driven call prices down, including interconnectivity tariffs, which were a major revenue stream for Telkom.

Rinaldi Firmansyah

A price war in the cellular sector in 2007 and 2008 was also eating into profits as mobile phone operators fought tooth and nail for market share. Telkomsel, the cellular subsidiary of PT Telkom, was particularly hard hit as it is the dominant player in the industry.

Change was absolutely necessary if the company was to survive and grow. Rinaldi proved to be the right man at the right time to take over the helm of the telecommunications giant and chart a new course.

Those days of sleeping in the office now seem a distant past. Rinaldi himself has been promoted to president director and chief executive officer of the listed company. Over the past three years, he has slashed costs significantly by reducing the workforce, entered into new business areas such as cable television and data transmission and forged a new corporate culture at the company.

Having put Telkom on a firm financial footing, he is now undertaking an even bigger challenge: to transform the company into a lean, competitive and innovative multimedia enterprise.

“About three to four years ago, we realized that telecommunications was just a commodity,” he notes. “That is when we started our transformation from being a telco to being multimedia player.”

Today, Telkom has five main business pillars – fixed line, cellular, communication data and applications, which includes cable television and internet providers, network and interconnection and fixed wireless access. These businesses are now grouped under the acronym TIME – telecommunications, information, media and edutainment.

“This was a bold move for us but we knew we had to modernize our infrastructure or we would see our market position erode,” says Rinaldi. He notes that unlike his main competitors who focus on new growth areas, Telkom still has to service its fixed-line customers, even though the business is declining.

Fixed-line business has been drying up for three consecutive years, shedding nearly Rp2 trillion ($220 million) in revenue while costs have remained constant. The fixed-line business has now stabilized and started to show growth again in the first half of this year,

Telkom, says Rinaldi, had no choice but to transform itself. To compensate for the lost revenue from its fixed-line business, the company invested in a number of new businesses. Those investments are now starting to payoff.

Over the past four years, the company spent Rp2 trillion a year upgrading its fixed-line network and offering new services and products. It spent another Rp500 billion per year improving its IT system and Rp1.3 trillion acquiring new businesses. “Now the industry looks at us as a market leader and innovator instead of a lazy incumbent,” says Rinaldi.

New Equilibrium

There is no doubt that changes are needed. While Telkom’s revenue was up 5% in the first half of 2010 at Rp34.243 trillion, from Rp32.612 trillion a year earlier, net profit slipped 0.7% due to higher operating costs and lower foreign exchange earnings.

Nevertheless, Rinaldi’s new strategic push has begun to be noticed by investors and market players. According to Raymond Kosasih, research analyst at Deutsche Bank Verdhana Indonesia, the cellular industry is doing much better now than it was 15 to 18 months ago. “A new equilibrium is being formed and top-line growth has recovered.”

He believes cellular prices have reached bottom and are unlikely to fall further. This is good news for Telkomsel as it will allow the company to post a much stronger second-half performance. This will translate into a much better performance for Telkom as a whole.

“We like PT Telkom in general and we have a buy recommendation on the stock,” says Raymond. “The TIME strategy makes sense as it will help the company maintain its growth strategy.” Looking at the past three quarters, he says in a recent report that he expects the top three telcos to maintain their market share.

“This equilibrium has been achieved on the back of healthy revenue increase of 13.5% year-on-year – perhaps the highest in the region. We expect future changes in market share to be driven more by operators’ share of industry growth which we think will be evenly split,” the report notes.

Going forward, the key challenge for Rinaldi and Telkom will be to implement the TIME strategy and implement further cost-efficiency programs, notes Raymond. Near-term revenue growth will still come from its fixed line and cellular business while over the longer term the company will reap the benefits of pushing into cable television and data.

“In the long term, the TIME strategy makes sense but it is coming from a very small base,” says Raymond. “Personnel costs currently make up the second largest cost component for Telkom so trimming staff numbers is important for the bottom line.”

Harry Su, senior vice president and head of research at Bahana Securities, agrees, noting that Telkom has little choice but to undertake the changes. “It’s part of the natural transition of the company from fixed-line to cellular and now to data and multimedia.”

“Telkom has until now been seen as a sleeping giant reacting to what the competitors are doing,” he adds. “To be fair, as a state-owned enterprise, they have done well in maintaining their number one position in the industry.”

He predicts that the telecommunications sector will continue to post healthy growth over the next few years, even though penetration rates are now relatively high. Diversification will be the main challenge faced by all the major players in the industry.

Transforming from within

Rinaldi understand the dynamics of change only too well. The company has to change or die a natural death.

Perhaps the new corporate culture at Telkom is best reflected by its new logo, a blue circle with an orange-colored open palm. This is the first time the company has changed its logo since going public in 1995 when its monopoly on fixed lines was dismantled.

With its new tagline “The world is in your hands,” Telkom is also looking ahead rather than living on its past glories as it seeks to meet changing customer demands.

Going deeper, beyond the public image, Rinaldi is attempting to transform the very heart of the corporation. Having sorted out its business strategy and competitiveness, his next challenge was to change the corporate culture of the organization.

The first thing he had to do was trim the size of the company from more than 30,000 employees to its current level of 25,000. The cuts were made in the fixed-line division, where the number of employees fell from 26,000 to 21,000. “There is no other state owned company that has been able to reduce the number of employees like Telkom. We understood that we needed new blood to enter into new markets.”

The process, he adds, is ongoing as new technology will require further streamlining of operations. Layoffs, however, are voluntary and employees are given several options. One of the main changes he has made has been to consolidate and centralize back-office operations to make them more efficient.

“No Telkom CEO in the past was bold enough to centralize the IT, HR and finance functions,” says Rinaldi. “It was tough as there was rejection but now with only two regional offices from seven previously, we can move faster.”

His next big challenge will be to grow the new wave businesses as quickly as possible. Content, he says, will be king in the future and Telkom must be able to compete on this front. “The industry is moving towards content-based operations and we have to be able to provide content on our network.”

Content and new electronic gadgets that can download content will be the wave of the future. This trend poses a huge dilemma for the telco industry as it provides the network but the growth is in content.

“Everyone is Googling on our network but we earn nothing,” he notes. “Content is an industry with many small players while telecommunications is a capital-intensive industry with a few players. We must find some way to cooperate.”

The overall industry, says Rinaldi, is still growing fast. Teledensity in Indonesia is now close to 80% with 180 million cellular subscribers. Telkom has half with 90 million subscribers.

The fixed broadband industry has a low 2 million subscribers, offering great potential, with growth currently at between 8% and 12% per year. Telkom’s new wave businesses currently contribute 15% of consolidated revenue. Rinaldi’s target is to increase this to 25% by 2014.

“My challenge is to defend the legacy and grow the new wave business,” says Rinaldi. “We want to be a leader in each area of our business and at the moment we are only number one in telecommunications. There is a lot of work to be done.” GA

From The Globe Asia

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You’ve travelled for adventure, romance and culture, so why not to make some friends? Taken from Lonely Planet’s 1000 Ultimate Experiences, here’s a list of places where the welcome is always warm.

Ireland
Centuries of turmoil have certainly taken their toll on the Irish: they’ve been left with a deliciously dark sense of humour and a welcoming attitude towards strangers. That famous ability of the Irish – to find craic (fun times with convivial company) in boom or bust times – means you’re always in for a treat. These days, after the end of the ‘Troubles’, a cautious optimism reigns supreme, infecting the land once again with the sense that anything’s possible.

USA
Blamed though they are for the coming of WWIII, the Anti-Christ, Miley Cyrus, Bruce Willis, monster trucks, rampant street crime, and noise pollution through overloud talking, Americans just take it all in their stride. They know there’s no such thing as a ‘typical Yank’, so you can just stuff your stereotypes in a sack, mister! The USA’s citizens will invariably welcome you and help you get the best out of their country – all they ask in return is for you to leave your preconceptions at home.

Malawi
Malawians describe themselves as ‘the friendliest people in Africa’, living in the ‘warm heart of the continent’. Anyone who’s visited will know that the rare (for Africa) cohesion of the country’s ethnic groups is solid evidence for this, as is the people’s propensity to welcome you into their homes as well as their nation. Malawi is small, poor and without a lot of facilities, but with a greeting like that who needs Western-style comfort?

Fiji
Fijians are generally considered to be the ‘friendliest people on the planet’. And why not? They’ve got plenty to smile about – lush islands, kaleidoscopic reefs, cobalt sea, a wealth of marine life, world-class diving, romantic coastlines, awesome cuisine – and they love to spread the love around. Fijians have a rep for helping travellers feel welcome, thereby allowing you to uncover the best from this sprawling group of islands. Just don’t mention the coup.

Thailand
Southeast Asia’s most-visited country is bound to offer a welter of stereotypes and clichés. Here are some: dazzling islands and beaches; lush and balmy weather; great shopping and great food; the ‘France of Asia’. Here’s another one: ‘world’s friendliest people’. Gawd, not another contender (see Fiji and Samoa). Why bother trying to analyse why the Thais are so easygoing and quick to smile? They just are, and that’s all there is to it.

Samoa
What’s this? Samoa reckons it has ‘the world’s friendliest people’? Hmmm, trouble is there’s no ratifying body for such a claim, meaning the Samoans are up against the Fijians, who also claim to hold the title. OK, enough: let’s settle this with a Googlefight. A search for the phrase ‘Fiji world’s friendliest people’ garners 16,600 hits; the phrase ‘Samoa world’s friendliest people’ reaps 13,800. Sorry, Samoa, the interweb has spoken, although travellers can rest assured that your beautiful country harbours lovely and warm people who will leave a deep and lasting impression.

Vietnam
Vietnam is another country inextricably caught up in Western images and stereotypes: napalm, tormented soldiers, Oliver Stone films… But Vietnam put all that behind it a long time ago and is now on a huge drive to become the new ‘Asian tiger’ economy. Economy and history regardless, travellers are bound to get a friendly welcome and plenty of smiles in Vietnam.

Balinese Indonesian

Indonesia
It’s hard to make generalisations about a country that contains so many different cultures. Still, from laid-back Lombok to the rice fields of Java and the highlands of West Papua, the one thing travellers can safely expect is a wide smile from the locals. Indonesians of all stripes share an innate hospitality and a fascination with visitors, and they always find time to stop, meet and greet. Whether it be spontaneous English lessons with bike-riding schoolchildren, casual banter at streetside food stalls or haggling for batiks, interaction with the locals is a highlight of travels in the archipelago.

Scotland
The Scots have survived English invasion, brutal weather and the pain of having the world’s worst goalkeepers. This fighting spirit against insurmountable odds has left them with an extroverted, buoyant demeanour and a blackly humorous nationalism (you’d want to see the funny side after witnessing some of those goalies). Naturally, this attitude rubs off on travellers – Scots are so loyal they want you to share in the good stuff, too.

Turkey
The Turkish people have an unsurpassed reputation for hospitality. With their heavenly cuisine, dreamy coastline and spectacular historical sites, the Turks know there’s no reason to be secretive. Expect warm greetings, countless cups of tea and plenty of time to sit and chat in this charming country.

Source: Lonely Planet

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At the western edge of the Pacific Ocean, thousands of meters below the surface, scientists have discovered a remarkable new creature they have dubbed the “squidworm“. The researchers used a remotely operated vehicle to find Teuthidodrilus samae at the bottom of the Celebes Sea off the eastern coast of Borneo, Indonesia. The segmented worm, whose discovery the team details online today in Biology Letters, sports a series of 10 large appendages near its head that give it a squid-like appearance.

Squidworm at the bottom of Celebes Sea

T. samae was discovered in an area of the world known as the Coral Triangle, which contains an abundance of coral reefs and marine life that are presently endangered due to overfishing and pollution. The discovery of unknown organisms here indicates that species are dying out before they are even identified, the researchers write.

News Credit: Yahoo!

Photo Credit: WHOI

Popularity: 3% [?]

Surrounded by white sandy beaches marked by natural purity and crystal clear water, the small island of Pombo in Maluku needs to be turned into another tourist attraction in the “province of one thousands islands.”

Having a good time with family members at the beach around the efficiently and environmentally friendly island of Pombo will be an unforgettable experience for the visitors.

Since Pombo Island is part of Central Maluku district, the local culture and tourism office has undoubtedly called on investors to develop that coral island`s tourism potential.

Pombo Island

Central Maluku Culture and Tourism Office spokesman Mansyur Tawainela said in Ambon on Thursday that investors were expected to develop Pombo Island and preserve its natural tourism heritage as another tourism object in Maluku.

Maluku province is a chain of around 1,000 islands, extending over 851,000 square kilometers.

Some of the islands are volcanic regions covered with luxurious vegetation and the others are surrounded with the finest coral reefs and atolls with crystal clear waters.

The beaches there are lined with swaying coconuts that make them some of the finest in the world, and one of them is at Pombo Island.

Therefore Mansyur said he was prepared to facilitate the investors who wanted to develop that tiny island, located northeast of Ambon, into a marine and natural tourism destination in Central Maluku district.

A group of young students at the Pombo Island seashore(source Rini Sucahyo)

“Pombo Island has natural and undersea beauty that can make the visitors feel at home once they set foot on the island,” Mansyur said, adding that the most interesting part of the island was its natural purity and beauty.

Pombo Island is geographically close to Liang, Waai, and Tulehu villages at Salahutu subdistrict in Ambon Island, and near Kailolo village in Haruku Island.

Mansyur said the development of Pombo Island into a tourism object should also be approved by Forestry Minister Zulkifli Hasan because of the island`s status as a nature preserve.

“We are ready to give a recommendation to the forestry minister if the investors have met various requirements,” Mansyur said, adding that Liang, Waai, Tulehu, and Kailolo villagers would also be encouraged to participate in making Pombo Island tourism development a success.

According to him, an investor from Jakarta had an intention to develop Pombo Island into a tourism object, because a team of the investor was currently making a familiarization with Liang, Waai, Tulehu, and Kailolo villagers.

Waai Village

Pombo Island is about 30 minutes from the coast of Waai Village by boat and it takes approximately 45 minutes to get to Waai from Ambon City.

Mansyur said the travelers to Pombo Island could get there by boat, provided by the local agencies.

The agencies will also provide the visitors with diving equipment so that they can dive to enjoy the beauty and amazing Pombo Island`s underwater world.

“The colorful fishes swim across so that all divers may photograph or capture the moment by video cameras. The complete species of fishes may be observed by observers who want to make research,” Mansyur said.

Meanwhile, Din Kelilauw of Ambon residence said that not only the complete collection of fishes that would amaze the scuba diver but also its coral reef as the fishes home redecorated the scene.

The tropical sun shine will brighten the scene and give certain effect on the photographs, so that we recommend Pombo Island as a destination for challenging family holiday, Kelilauw said.

Pombo Island marine recreation park comprises an area of 1,000 hectares with nothing more than sandy beaches and coral debris, covered by shrubs and nesting trees for various big and small birds species.

But unfortunately the coral reefs immediately surrounding the island are heavily damaged, and only a small area south-east of Pombo Island is still worth visiting.

Pombo Island marine park, an atoll with white sandy beach inhabited by sea gulls, is also located just across from Ambon Island`s Honimua beach at Liang village.

“But Honimua beach sometimes looks desolate even on holidays or weekends, because people now prefer going to other places,” said Rosny Marasabessy, a visitors from Ambon.

She admitted that holiday makers seldom visited Honimua beach because it was rather far from Ambon while its services and recreation facilities were not good enough.

The beauty of Liang`s Honimua beach seemed to have been grossly neglected by the local government, whereas this tourism asset needed the attention of all parties in the region.

Liang village head Abdul Razak Opier said to take care of the facilities at Honimua beach the village administration got only Rp1.5 million for the period 2009-2010 from the local government.

But now, Maluku tourism and culture office spokesperson Ima Tualeka said, the recreation and other facilities at the beach would be rehabilitated and upgraded to attract more tourists.

Maluku`s culture and tourism authorities also made every effort to do an upgrading and rehabilitating job on the facilities at Honimua beach to make it more presentable to tourists and other visitors.

The stretch of pristine beach at Liang village in Salahatu sub-district which in the 1990s was rated as the most beautiful seashore in Indonesia by the UN Development Program (UNDP) once attracted many visitors, but somehow it became a forgotten recreational spot.

Located northeast of Leihitu Promontory, Honimua beach facing Seram Island used to draw numerous visitors on holidays and weekends.

There was also a restaurant, run by local people to provide visitors with typically local food , baked fish, and so-called “Colo-Colo.”

Next to the beach was a Ferry Deck to make the crossing to Seram Island and Pombo Island.

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Mention Asia and most global investors will think China or India. But they may want to start paying attention to another country in the neighborhood.

In 2009, Indonesia had the world’s second-best performing stock market, up nearly 86%. And so far this year, it has climbed 45%.

Gleaming corner of Jakarta

That’s a far cry from October 2008?s dark days, at the peak of the global financial crisis. Back then, Indonesia’s Jakarta Composite Index fell 50%, and even had to shut down for three days.

But today, those troubles seem long past. Things are looking up for the archipelago… and anybody smart enough to invest in it.

Indonesia’s Remarkable Awakening

Indonesia has experienced remarkable change in the past few years.

Twelve years ago, it broke free from three decades of authoritarianism. Today, it has the world’s fourth largest population and is one of Asia’s fastest growing economies.

The country still has issues with deeply entrenched corruption, failing infrastructure and legal uncertainties. Yet it still offers big returns for investors to revel in.

Overall, Indonesia has sound economic fundamentals and sustainable economic growth at around 6%. It also boasts low benchmark interest rates, high foreign currency reserves and strong foreign direct investment.
That all factors into why the Japan Credit Rating Agency upgraded Indonesia’s government debt to investment grade this year.

It should know, since Japan is Indonesia’s largest, foreign, long-term investor. Investors there have long-kept parts of their fellow Asian nation in their portfolios.

Other countries are also beginning to take notice. In the World Economic Forum’s 2010-2011 Global Competitiveness Index rankings, Indonesia rose 10 spots to 44th place… the list’s third-biggest mover.

Indonesia’s Middle Class

Americans largely continue to view Indonesia as a commodities-based economy. But private consumption now makes up about two-thirds of the economy there.

It does have an abundance of natural goods such as coal, tin and palm oil. But its commodities sector has actually underperformed this year.

Instead, the consumer sector took off, thanks to the 60 million low-income Indonesian workers projected to join the middle class in the coming decade. If so, that makes the country the fastest growing consumer market after only China and India.

Market research company Euromonitor expects that to continue. It sees the number of Indonesian households with $5,000-$15,000 in annual disposable income growing from 36% of the population this year to over 58% by 2020.

The Asian Development Bank (ADB) also recently noted growth in Indonesia shifting from urban centers on the main island of Java to other parts of the country. And poverty reduction in such rural areas is much bigger than in the urban areas.

Big retailers, banks, automakers, insurers and consumer goods producers are tapping the growth. In return, they’re posting record profits this year.

Astra plant, Indonesia's biggest automaker

Astra International (PINK: PTAIF), Indonesia’s biggest automaker, certainly is. Its shares have risen over 60% this year thanks to booming business. Astra’s vehicle sales rose 60% January – September 2010. And the larger share of that came from the islands of Sumatra, Sulawesi and Kalimantan.

As a whole, Indonesia is set to be the region’s largest automotive hub, producing 730,000 automobiles and 7.2 million motorcycles. Despite expanding factory capacity, Astra says it can’t keep pace with demand.

Investing in Indonesia

U.S. investors who want a part of Indonesia’s growth should try one of two ETFs.

iShares MSCI Indonesia Investable Market Index Fund (NYSE: EIDO): Fairly well balanced, it has about 29% in financials, 27% in consumer stocks and 22% in commodity stocks. It has about 13% in Astra International, its largest holding.
Market Vectors Indonesia Index ETF (NYSE: IDX): It contains about 27% in financial stocks, 23% in consumer stocks and 26% in commodity stocks. Its largest position is also in Astra, but only with 8%.
The only downside to investing in Indonesia is the possibility of a short-term stock bubble. Thanks to QE2, some U.S. dollars could rush in there in search of higher returns.

The search for hard assets has already sent some of its commodity producers’ stocks rocketing higher recently.

Fortunately, many companies there still boast growth well above their 2011 P/E ratios. And the Indonesian rupiah continues to gain against the dollar.

So in the long-term, Indonesia looks good… and is set to look even better.

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By Tony D’Altorio

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Indonesia have recently formalized 21 new diplomatic relationships, leaving Israel and Taiwan as the only two countries which do not have diplomatic links with Indonesia.

Indonesian Foreign Affairs Minister Marty Natalegawa gathered with House Commission I, which oversees foreign affairs, to seek approval of the new diplomatic relationships. Chairman of House Commission I said they fully supported the request as not a single objection was made.

Mr Natalegawa, Indonesia's FM

Eight of the countries are from Africa, three are in the Pacific, two from Central America, five from the Caribbean, two from Europe, and one from Asia.

Natalegawa said, stating that the new ties would help both the economy and the government’s ability to protect Indonesian citizens in other countries.

The diplomatic ties would be carried out through memorandums of understanding and visits by special envoys, avoiding further expenses from state money.

Regarding Israel, Natalegawa said Indonesia would not open diplomatic ties until it abides to all UN resolutions and until Palestine’s independence is recognized. On Taiwan, the minister said the country would continue with its one-China policy, adding that its trade and economic exchange with the island remains strong.

(Copyright 2010 by BNO News B.V. All rights reserved. Info: sales@bnonews.com.)

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Long known as feminine and demure, Indonesia’s traditional kebaya is headed for a makeover at the hands of innovative designers.

Growing demand for stylish yet still modest fashions in the world’s most populous Islamic nation is helping power efforts to bring Islamic fashion into the modern age, a movement symbolised by changes to the iconic kebaya, a blouse-dress combination.

The Kebaya, Indonesia's very own clothing style

Fun prints, intricate detailing, colours so bold as to be psychedelic and a mix of delicate lace all graced the catwalk at the recent Jakarta Fashion Week. One designer even paired the kebaya with red-and-yellow striped tights.

“I think it’s a good presentation because if you wear Muslim clothing like this, it’s not necessarily boring,” Jakarta Fashion Week project manager Petty Fatimah told Reuters.

“You can definitely expect to see more Islamic fashion in the future and it is for everybody. If you’re not a woman who wears Islamic clothing you can still wear it.”

Though Islamic clothing is not mandatory throughout much of this vast nation, many women struggle with the desire to be both fashionable but dress in line with Islamic principles that rule against showing hair or skin.

In a nod to local mores, U.S. First Lady Michelle Obama donned a headscarf on her visit to Jakarta’s Istiqlal mosque earlier this month. But wearing the headscarf is not mandatory and regulations concerning clothing are fairly liberal save for Indonesia’s West Aceh district, which is the sole upholder of sharia — or Islamic — law.

Earlier this year, authorities in West Aceh began giving away long, loose skirts to Acehnese women wearing tight jeans.

Yet despite coming across as “sexy” to some due to its tight fit and use of see-through materials, the kebaya has managed to escape censure even from Islamist groups such as the Prosperous Justice Party (PKS), who criticized the wives of the president and vice-president last year for not wearing headscarves prior to the presidential elections.

MODERN DESIGNS, MUSLIM CLOTHING

For those in the industry, allowing the kebaya to be reinvented paves the way for designers who want to introduce modern designs into Muslim style clothing.

Themed “Styling Modernity,” models in kebaya outfits launched Jakarta’s third Fashion Week earlier this month, with 16 selected designers putting their own spin on the garment.

“If you look at the scene five years ago, women didn’t have choices. But now, it’s growing, and we have many designers who design Muslim wear,” said designer Lenny Agustin, who is known for her eclectic style.

Other collections, with titles such as “Romantic Return,” “Garden Luxury” and “Catch Your Eyes,” featured billowy ankle length dresses, harem-style pants and tunic suits which still complied with Islamic clothing norms.

Keeping stylish fashion in line with Islamic norms isn’t just a gesture for traditionalists, Petty Fatimah noted.

“Fashion is a big business and our population is very big. By focusing on local fashion that would cater to the local population, it is a big opportunity,” she said.

Homemaker Tuttiyah, 55, who wore a long, full-sleeved blue tunic-style blouse with black three-quarter pants, said she doesn’t feel torn between style and modesty because there are so many choices available. She wears a headscarf outside her home.

“Those who prefer the traditional version can still buy and wear that, whereas those who want to keep up with modern times can buy and wear the modern ones,” she said.

“If you want to look good, if you want to look fashionable, you have to keep up with modern times and changing trends.”

Source : Lifewise Style

This story was posted on Fri, November 26, 2010

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