Indonesia Coronavirus Update #25, August 17, 2020
Cumulative number of reported cases: 141,370 (as of August 17)
Rupiah to US$14,917
Jakarta Stock Exchange Index: 5,247
Indonesia celebrated its 75th Independence day on August 17th, 2020. (Merdeka !) President Joko Widodo (Jokowi) presided over the Independence Day ceremony along with a handful of state officials and dignitaries at the Presidential Palace in Central Jakarta. In stark contrast to previous Independence Day ceremonies, this year’s commemoration was a relatively subdued affair as most of the event took place digitally due to concerns over COVID-19.
Case growth continues at a 10% pace. Active cases (total cases minus recoveries and fatalities) grew 3% after flatlining for 3 weeks. Jakarta and West Java are growth areas for new infections whereas Central and East Java remained flat.
Local phase 3 trial of a vaccine developed by China’s Sinovac has begun. If it goes well Indonesia plans to inoculate 70% of its population with PT Biofarma expanding production facilities. Indonesia’s council of Islamic clerics (MUI) determined that although the trial vaccine, imported from China, was not halal, Indonesians could take it. A South Korean company is working with the Health Ministry to conduct trials of a COVID therapy utilizing stem cells.
Travel- Not Opening Until End of the Year
The date for reopening Bali for tourists, announced earlier as September 11 by its Governor, now appears to have been postponed. Meanwhile, 7,000 Australian tourists who extended their visas due to COVID-19 are being asked to leave when the extension ends August 20. According to CNN Indonesia, Coordinating Minister Luhut Pandjaitan, speaking on a webinar organized by the Indonesian Employers Association (APINDO) said: “We want domestic tourists to reach 70 percent [of previous levels]. The problem with foreign visitors [is] we will not accept them until the end of the year.” He did not give any further details, but those comments suggest that Jakarta will extend restrictions banning all foreigners—except for diplomats, aid workers, and those with work or residence permits—from entering the country at large. Erick Thohir, chief of Indonesia’s national economic and COVID-19 recovery announced that Indonesia will remain closed to foreign tourists at least until the end of the year or until a vaccine is developed.
- Currency: Bank Indonesia issued a 75,000 rupiah note in honor of the nation’s 75thanniversary of its independence declaration.
- Capitol: Coordinating Investment and Maritime Minister, Luhut Pandjaitan acknowledged delays in the planned move of the capitol to Kalimantan
- Growth Predictions: According to President Joko Widodo (Jokowi), Indonesia’s economic growth is targeted to be in the range of 4.5 to 5.5 percent in 2021. Moreover, Finance Minister Sri Mulyani Indrawati estimates that national economic growth will be in the range of minus 1.1% to positive 0.2% in 2020.
- Omnibus Job Creation Bill: Legislators and union officials are reportedly forming a team to discuss the controversial labor provisions in the long-delayed bill that would overturn a 2002 Labor Law with very generous severance provisions. At the time these benefits were thought necessary given the paucity of social security, pension and other old age benefits but now Indonesia has enacted more of them Even though 57% of Indonesia’s workforce is in “day labor”, informal positions receiving no benefits or protections, and only 9% are unionized (whose ranks have been dwindling), the government has been averse to pushing forward the bill, even though it has the votes in Parliament. The bill is one of many reforms that would attract labor intensive foreign investment, helping to increase formal employment and swelling the ranks of labor unions.
- Bali Revival Paradigm– Coordinating Investment Minister Luhut Pandjaitan echoed suggestions of AICC member, Jack Daniels, to promote the use of Bali as a global center for technology workers connecting remotely. The Minister promoted another of Daniel’s ideas: Bali as a center of medical tourism. Jack is a long-time American permanent resident in Bali managing the region’s premier travel and events firms, Bali Discovery. You can read the complete list of his suggestions for Bali’s revival in the recent edition of Bali Update, BD’s recent newsletter. https://balidiscovery.com/obstacles-to-bali-restarting-tourism/
Relief Aid Delayed: Roughly only 22.4% of Indonesia’s stimulus package had been spent since the stimulus plan’s launch in March. The package had been split between health and economic recovery programs ranging from corporate tax exemptions to food and cash aid for households. Finance Minister Sri Mulyani announced a plan to fast track cash assistance via low income workers already registered for worker insurance. Apparently, some of the delays in rolling out social assistance funds has to do with inaccuracies and gaps in the government’s existing databases of eligible recipients. However, left out are the large group of informal workers who are not registered. But some of them will indirectly benefit as they provide goods and services to those in the “formal” sector.
(sources: International and Indonesia news media, Bali Update (from balidiscovery.com), Reformasi Weekly)