Indonesia's economy held by lack of infrastructure


Indonesia's economy held by lack of infrastructure Locals, and their ancestors, block road project, showing constraints on Indonesian economy Months behind schedule, the construction crew racing to finish a highway encircling Indonesia's traffic-choked capital is being blocked by a determined group of locals and the ramshackle cemetery that is home to their ancestors.

Talks on a new location have yet to reach an agreement accepted by all the relatives of the some 500 people buried there. That has not stopped authorities digging a new cemetery a short distance from the old one — pointlessly according to Yaman, the neighborhood chief.

"There is no way we can agree to that," said Yaman, pointing to workers hacking through the thick red earth amid a mid-afternoon rain shower. "It will be too noisy. How are we supposed to pray for our ancestors there?"

Indonesia's economy is booming. But to sustain and deepen its growth, it badly needs new roads, bridges, power stations and ports. Land disputes such as this one in west Jakarta, and a host of other difficulties from corruption to budget-draining populism, make building such infrastructure a long and costly process. That is preventing the country from attaining the kind of transformational development experienced in a generation by countries such as South Korea and more recently China.

Last week, floods engulfed around 30 percent of Jakarta, including its central business district, dramatically exposing decades of underinvestment in the drainage and flood defenses of the city of 14 million people.

To be sure, beleaguered economies in the West would envy Indonesia's current growth rate of more than 6 percent. Coupled with political and social stability, it represents a dramatic change from the Indonesia of 12 years ago, when political crisis, separatist violence and economic meltdown led to fears the massive island nation could break apart.

Investment has soared over the last two years amid high Chinese demand for the country's coal, palm oil and rubber and rampant consumer spending across the country. Property prices have doubled in downtown Jakarta over the last 6 years, while malls, hotels, housing estates and convenience stores have sprung up in towns large and small to cater for a newly minted middle class.

The boom has left some wondering whether the country should now sit alongside Brazil, Russia, India and China in the BRIC club of newly powerful emerging economies. While the government expects the country will continue to attract investment, others doubt it will fulfill its potential.

"Six or 7 percent is all well and good, but can it go the next step to 8 or 9 that the government wants?" said Gareth Leather, an Asia specialist at Capital Economics. "The main problem is the business environment is still not conducive to the kind of conditions needed for economies to grow to that level."

While scrimping on infrastructure, schools and hospitals, successive governments have chosen to maintain subsidies on fuel for the country's 240 million people. Cheap fuel may win votes come election time, but it comes with a cost. In 2011, the subsidy bill ran close to $20 billion, the same amount the government is targeting to spend on infrastructure in 2013.

That figure represents a 15 percent rise on 2012, but experts doubt the government will be able to spend it all because it lacks the capacity to do so. Foreign investors can bring in expertise, but for many the country remains too risky because of corruption, legal uncertainty and problems acquiring land.

Political and social problems are also looming. Most of the leading candidates vying to replace President Susilo Bambang Yudhoyono in mid-2014 are old faces, seen as likely to champion economic nationalism rather than reforms. Labor disputes are on the rise, as are wages. While poverty is being reduced, income inequality levels are some of the highest in the world.

The country's investment chief dismissed fears of economic protectionism, predicting Yudhoyono's successor would be driven by pragmatism despite campaign rhetoric to the contrary.

"Whoever the president is in 2014, if they want to maintain power, they need to provide jobs to reduce poverty," said Basri Chatib. "Like it or not, even if they become nationalist, there needs to be an open economy. "

The infrastructure challenges facing the country become clear when travelling around it: highways between major cities cut through markets where traders spill onto the road, snarling traffic. Local fruit is often more expensive than that imported from China because of the costs of shipping to the capital from the regions. Cement costs 10 times more on outer islands than in Jakarta once it has made its way through the antiquated port system.

The challenges are especially apparent in Jakarta. As the middle class has grown, so has car and motorbike ownership. But unlike in neighboring Bangkok, Kuala Lumpur and Singapore, the city has failed to build decent public transport. As a result, commutes of 6 kilometers (miles) often take upward of 1 ½ hours.

Construction of the west Jakarta section of the ring road was supposed to finish at the end of 2012, but securing the land from locals in its path has been especially torturous. As elsewhere, speculators — often working in league with government officials — bought up the land and have essentially set their price for the project to continue.

The cemetery was public land before locals started burying their dead there more than 20 years ago. Authorities have offered at least three alternative locations, but they have been rejected. Yaman, who goes by a single name, insists that he and the villagers he represents don't want money to solve the problem. When out of earshot of Yaman, one villager suggested they were waiting for a payout in exchange for the right to dig up their dead. Authorities in charge of buying the land on behalf of government declined repeated attempts for comment.

A new land law that aimed at removing these obstacles stipulates that negotiations must be completed in three months and gives the government greater authority. It has been praised as giving more certainty to investors seeking to partner with the government in large projects. Still, it doesn't apply to projects started before 2014 and, as ever in Indonesia, how it is implemented will be crucial.

Jakarta's port, built in 1877 by the country's Dutch colonial rulers, is a symbol of how the country is growing — and what it needs to do to catch up with the rest of Asia. Handling almost 65 percent of the country's imports and exports, traffic has grown by 25 percent a year since 2009.

Construction work began two months ago on a $4.5 billion expansion that would double its capacity. Yet there are currently no plans to upgrade or build new road or rail links to and from the port, which is surrounded by urban sprawl and crammed with traffic.

"We can't wait 15 years to develop a new port, with the growth we have now we need to build today," said Richard Lino, head of the state-run corporation managing the port. "So I'm doing my part first and will then say, do you want to join with the trend. "

Customs clearance is currently more than 6 days, twice as long as in Kuala Lumpur, adding to business costs and clogging up the port further. "We are still fighting with the customs," said Lino. "Everyone knows what they are like." ( Associated Press )

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Indonesia Is (Not) a Tempe Nation


Indonesia Is (Not) a Tempe Nation - Indonesian founding president Sukarno, in his fiery speech in 1963, said, "We reach the sky, control the land and seas. We are a hard-working nation, not a 'tempe' nation, nor a nation of coolies. We fight at any cost and willing to suffer to achieve our nation's goals.”

The president was not referring tempe as an inferior food product, but in the course of Indonesia's history, tempe has often been associated with weakness, sufferings and oppression.

Dutch Governor General van den Bosch ordered forced labor in 1830 and all Indonesians who worked for plantations had to consume mandatory cheap food derived from cassava and soybeans, of which tempe is made. Tempe was founded during those years.

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Some producers of tofu and tempe who are members of Tempe and Tofu Producer Cooperation throws away tofu after raiding tempe and tofu stalls in markets in Semanan that did not join the strike scheduled from Wednesday to Friday. (Antara Photo)

At a time when the Dutch colonial rulers feast on fried chicken, stewed meat and gurame fish, inlanders or locals, had only tempe, tahu (tofu) and kerupuk (crackers) to eat with steamed rice, according to one account of history.

For ages, tempe has became a popular for its rich nutritions. Until today, no household is without tempe. Sukarno, Suharto, Gus Dur, Megawati and Susilo Bambang Yudhoyono, and the majority of people alike always craved for tempe at all times.

Tempe is always good whether its plain-fried, sambal tempe, tempe bacem, or tempe cracker which is exceptionally good with an ice-cold Heineken. And the best quality tempe comes from the area of Wonogiri which borders Central and East Java, where home-grown soybean is of the best quality.

But alas, tempe is no longer abundant or affordable. 80 percent of the soybeans had to be imported. Price of a kilogram of soybeans is now twice as high. In some places, they are no longer available. Tempe has become a rare luxury. The common Indonesians are now without tempe — their only alternative source of protein to more expensive chicken or beef.

Tempe makers have refused to make tempe due to unaffordable prices. Meanwhile soybean farmers resent high prices of imports. They can no longer earn a living cultivating soybeans. Protests and clashes were seen in several traditional markets in Jakarta and other major cities across the country.

The tempe crisis is a reflection of failure on the part of the current administration to protect the farmers and the nation’s need for food security. Carried away and buoyed by the comfort of easy free-market and import policies, the government is now trapped for being too dependent on other countries which are now experiencing slowdown in farming due to drought. It is now at a worrying stage.

Agriculture Minister Suswono doesn’t have a way out but he has to be responsible. He has failed.

Coordinating Minister for the Economy Hatta Rajasa can’t do anything either, or even President Susilo Bambang Yudhoyono. The most they can do is to free import duties to lower prices. That won’t solve the problem. The only way out is to protect our own agriculture sector and food industry.

After more than 60 years of independence, and recalling Sukarno’s wish that Indonesia should not be a tempe nation, it’s an irony now that even becoming a tempe nation has been proved to be very difficult. ( thejakartaglobe.com )

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No love for 'fiscal cliff,' 'spoiler alert'


No love for 'fiscal cliff,' 'spoiler alert' — Spoiler alert: This story contains words and phrases that some people want to ban from the English language. "Spoiler alert" is among them. So are "kick the can down the road," ''trending" and "bucket list."

A dirty dozen have landed on the 38th annual List of Words to be Banished from the Queen's English for Misuse, Overuse and General Uselessness. The nonbinding, tongue-in-cheek decree released Monday by northern Michigan's Lake Superior State University is based on nominations submitted from the United States, Canada and beyond.

"Spoiler alert," the seemingly thoughtful way to warn readers or viewers about looming references to a key plot point in a film or TV show, nevertheless passed its use-by date for many, including Joseph Foly, of Fremont, Calif. He argued in his submission the phrase is "used as an obnoxious way to show one has trivial information and is about to use it, no matter what."


At the risk of further offense, here's another spoiler alert: The phrase receiving the most nominations this year is "fiscal cliff," banished because of its overuse by media outlets when describing across-the-board federal tax increases and spending cuts that economists say could harm the economy in the new year without congressional action.

"You can't turn on the news without hearing this," said Christopher Loiselle, of Midland, Mich., in his submission. "I'm equally worried about the River of Debt and Mountain of Despair."

Other terms coming in for a literary lashing are "superfood," ''guru," ''job creators" and "double down."

University spokesman Tom Pink said that in nearly four decades, the Sault Ste. Marie school has "banished" around 900 words or phrases, and somehow the whole idea has survived rapidly advancing technology and diminishing attention spans.

Nominations used to come by mail, then fax and via the school's website, he said. Now most come through the university's Facebook page. That's fitting, since social media has helped accelerate the life cycle of certain words and phrases, such as this year's entry "YOLO" — "you only live once."

"The list surprises me in one way or another every year, and the same way every year: I'm always surprised how people still like it, love it," he said.

Rounding out the list are "job creators/creation," ''boneless wings" and "passion/passionate." Those who nominated the last one say they are tired of hearing about a company's "passion" as a substitute for providing a service or product for money.

Andrew Foyle, of Bristol, England, said it's reached the point where "passion" is the only ingredient that keeps a chef from preparing "seared tuna" that tastes "like dust swept from a station platform."

"Apparently, it's insufficient to do it ably, with skill, commitment or finesse," Foyle said. "Passionate, begone!"

As usual, the etymological exercise — or exorcise — only goes so far. Past lists haven't eradicated "viral," "amazing," ''LOL" or "man cave" from everyday use. ( Associated Press )

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Stop Getting Ripped Off on Auto Insurance


Stop Getting Ripped Off on Auto Insurance - Now is the perfect time to give your auto insurance a tune-up. Here are ten tips on how you can do it.

Do you feel like you're spending more on auto insurance than you need to? Want 2013 to be the year you put money back into your wallet?

Good news: You're likely already doing things that can help you save.

In fact, a 2012 trends survey by the National Association of Insurance Commissioners (NAIC) found that 53 percent of Americans have made an economic-driven change that could impact the cost of their car insurance in the past year.

Read on for some additional tips on potential car insurance savings that can help you stay on budget this year...

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Tip #1 - Shop Around

The Internet has redefined shopping. And that holds true with auto insurance. In fact, it's never been easier to shop for a lower rate.

But don't shop by price alone, advises Insurance Information Institute's (III) Vice President Loretta Worters. "Buying insurance is not just to protect you financially, it's also to provide peace of mind. So, it's important to pick a company that is financially stable," she says.

She suggests asking friends and relatives about their insurers, or contacting your state insurance department to find out whether they provide information on consumer complaints by company.

Here are other shopping suggestions from Worters:
  • Get at least three quotes.
  • Give the same information to all three companies; this ensures your comparison will be more accurate.
  • Check the financial health of insurance companies with rating companies such as A.M. Best and Standard & Poor's.
Tip #2 - Don't Over-Insure

There's a word for paying for something you'll never use: frustrating. Unfortunately, many people over-insure with auto insurance, according to Worters.

For example, collision and/or comprehensive coverage, which protect your car in the event it's damaged, may not be necessary on an older car. Worters' general rule: if your car is worth less than 10 times the premium, buying the coverage may not be cost-effective.

Information from NAIC's website also suggests that if a car is worth less than $1,000, you should consider only carrying liability coverage, which protects from damage you do to others or to property. This is because you'll likely pay more in premiums than the insurance will payoff, if and when you file a claim.

Tip #3 - Pay a Higher Deductible

Ironically, raising your deductible, the amount you'll pay out-of-pocket in the case of a claim, could be a great savings opportunity.

How? According to an III article titled "How Can I Save Money on Auto Insurance?," increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30 percent. If you raise your deductible to $1,000, your savings could climb to 40 percent or more.

If you decide to pursue this potential money-saving route, make sure you have the funds to cover the deductible in the case of an accident.

Tip #4 - Cash in on That Wedding

If you got married since you last renewed your policy, be sure to let your insurer know.

"Generally speaking, you can save money when you get married since married people file fewer claims than singles," says Worters. Therefore, married people are considered less of a risk than single people and can often qualify for lower premiums.

On the other end of the spectrum, if 2013 is a year of divorce instead of marriage, you still might be able to save if your ex had a bad driving record.

Tip #5 - Remove Children from Your Policy

Is your son or daughter going off to college this year? If so, you could save by labeling him or her as only an occasional driver on your policy. This means your child will only drive your car while home for vacation or holidays. And the savings could be significant.

Parents typically see a 50 percent increase in their insurance premiums if a child under 25 years old is listed on their policy, says Worters.

However, to qualify for a potentially lower premium, most insurers will require that the college your son or daughter attends is at least 100 miles from home, according to "Auto Insurance FAQ's" from NAIC's website.

Tip #6 - Drive Less

Driving less is trending. At least that's what the 2012 NAIC survey on economy-driven trends found. It states that almost 40 percent of consumers are diving less, instead choosing to carpool, walk, or take public transportation more often. If you're a part of that 40 percent, you could qualify for a low-mileage discount.

"You could save 10 to 20 percent, depending on factors like which state you live in," says Worters. So check your mileage. If it's 10,000 miles per year or less, you could be in for some good news about your premium, according to an III article, "What Determines the Price of my Policy."

Tip # 7 - Buy a Different Car

Are you thinking about buying a new car this year? Don't forget to check the insurance prices for the various makes and models you're considering. It could make a big difference.

Car insurance premiums are based in part on the car's price, the cost to repair it, its overall safety record, and the likelihood of theft, according to Worters. And if you thought only pimped-out luxury rides got targeted by thieves, think again.

The three most stolen cars in the U.S. for 2011 were the Honda Accord, Honda Civic, and Toyota Camry, according to the National Insurance Crime Bureau's "Hot Wheels" report.

So, before you pick out your new ride for 2013, make sure to research the car's stats and determine whether or not the insurance premium is in your budget.

Tip # 8 - Move Out of the City

Like marriage, you likely won't be moving out of the city based on auto insurance rates. But if you have moved out of the city, or if changes in your work allow you to drive and park in less urban areas, make sure your insurer gets the good news. Because to them, that's exactly what it is.

In fact, insurers consider cities so much more of a risk because of traffic (increased accidents), theft, and vandalism, that the 10 highest places to insure a car in 2011 were all populous cities, according to III.

And because we know you're curious, here are the three costliest places in the U.S. to insure a car:*
  • Detroit, Mich.- Average annual premium: $5,941
  • Philadelphia, Pa.- Average annual premium: $4,076
  • New Orleans, La. - Average annual premium: $3,599
Tip #9 - Use an Anti-Theft Device

Since stolen cars mean insurance payouts, there are some anti-theft devices that will garner you substantial savings.

For instance, says Worters, signing up for LoJack - which uses a hidden transmitter to let police track your car if and when it gets stolen - could net you a 15 to 20 percent discount.

Just make sure that whatever savings you get pays for the anti-theft device, if that's your primary purpose for using it. Of course, getting your stolen car back is kind of a nice thing, too.

Tip #10 - Take Advantage of Any and All Discounts

From being a good student to simply aging, there are a number of auto insurance discounts that you could potentially qualify for. But, don't expect your insurance carrier to automatically sign you up for discounts for which you qualify.

To get you started, here are a few common discounts:**

  • Mature Driver - Many insurers lower rates by 10 to 20 percent for drivers over 50 or 55, according to Worters.
  • Good Credit Score - Better credit usually equals a better rate, but not all states allow for credit-based insurance scores.
  • Good Student Discount - Usually requires a B average for a full-time student.
  • Passive Restraints - This is for seat belts that automatically buckle when you start the car.
  • Driver Education Course - Completing a defensive driving course could qualify you for savings.
  • Bundled Insurance - Get your auto and home or renters insurance with the same company.
  • Pay in Full - Applies when you pay your entire premium in one payment rather than installments. ( yahoo.com )

READ MORE - Stop Getting Ripped Off on Auto Insurance

World stocks mixed with US "cliff" still a concern


World stocks mixed with US "cliff" still a concern — World stock markets were mixed Wednesday, with Asian shares up as China neared the climax of a once-a-decade leadership transition while Europe remained mired in uncertainty debt-swamped Greece.

Wall Street appeared headed for gains as renewed efforts got under way in Washington to resolve the impending "fiscal cliff." Dow Jones industrial futures rose 0.5 percent to 12,782 and S&P 500 futures added 0.6 percent to 1,378.50.

But European stocks fell in early trading, despite Greece's successful sale of short-term treasury bills Tuesday. Without the sale, Athens would have found it impossible to repay the €5 billion ($6.4 billion) treasury bill maturing on Friday, the day on which Prime Minister Antonis Samaras has said Greece would run out of money.


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Associated Press/Ahn Young-joon - A currency trader reacts in front of screens showing the Korea Composite Stock Price Index (KOSPI), center, and foreign exchange rate, right, at the foreign exchange dealing room of the Korea Exchange Bank headquarters in Seoul, South Korea, Thursday, Nov. 8, 2012. South Korea's Kospi dropped 1.19 percent at 1,914.43. (AP Photo/Ahn Young-joon)

Britain's FTSE 100 lost 0.5 percent to 5,759.43. Germany's DAX was 0.1 percent lower at 7,160.64. France's CAC-40 shed 0.3 percent to 3,421.39.

Asian stocks heralded the leadership transition taking place at China's Communist Party congress this week. On Wednesday, President Hu Jintao stepped aside to make way for Vice President Xi Jinping as party leader. Traders were hopeful that the transition will be followed by greater initiatives to shore up China's listless economy.

Hong Kong's Hang Seng jumped 1.2 percent to 21,441.99. Mainland Chinese shares also gained, with the Shanghai Composite Index rising 0.4 percent to 2,055.42. The Shenzhen Composite Index gained 0.3 percent to 818.60.

Japan's Nikkei 225 index rose marginally to close at 8,664.73. Australia's S&P/ASX 200 gained 0.2 percent to 4,388.40. South Korea's Kospi brushed off earlier losses to rise 0.2 percent to 1,894.04.

Traders have to deal with the uncertainty posed in the U.S. by the looming "fiscal cliff," a set of U.S. government spending cuts and tax increases that will take effect automatically at the beginning of next year unless U.S. leaders reach a compromise before then.

Unless Congress acts, all Bush-era tax cuts would expire, raising 2013 tax bills for most Americans. Obama wants to end those tax cuts only for households making more than $250,000 a year while Republicans oppose all tax rate increases.

Worries about the impasse pushed U.S. stocks to one of their worst weekly losses of the year last week.

U.S. lawmakers gathered for talks on Tuesday, giving traders hope that at least a temporary compromise might somehow be reached before a deadline in seven weeks. President Barack Obama was to meet later Wednesday with about a dozen business executives who want to see an agreement before the end of the year.

"People feel there's been a significant pullback over fiscal cliff worries," said Andrew Sullivan, an independent market analyst in Hong Kong. "The reality is we are likely to see a solution."

Among individual stocks, Japan's Sharp Corp. soared 7.2 percent after Japanese media reports said Intel Corp., the world's largest chipmaker, was in talks with the struggling electronics maker about a business alliance.

South Korean tech shares led gains in Seoul. Chipmaker SK Hynix gained 4.9 percent. LG Electronics added 4.6 percent on an improved sales outlook for the fourth quarter, Yonhap News Agency said.

Benchmark oil for December delivery was up 14 cents to $85.52 in electronic trading on the New York Mercantile Exchange. The contract fell 19 cents to finish at $85.38 per barrel on the Nymex on Tuesday.

The euro rose to $1.2730 from $1.2705 late Tuesday in New York. The dollar rose to 79.94 yen from 79.41 yen. ( Associated Press )

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