A Muslim Davos

Asim Siddiqui, guardian.co.uk

This week saw the meeting of the World Islamic Economic Forum (WIEF), the equivalent of the Muslim world's Davos, held this year in Jakarta. In attendance were heads of states and senior government figures from across the Muslim world, including Indonesia, Malaysia, Morocco, UAE and Qatar, with delegates from 38 countries.

The purpose of the WIEF is to increase trade and business activity among Muslim countries and beyond. I had the privilege of chairing one of the sessions. Fazil Irwan, director at the WIEF Foundation explained to me that WIEF's central pillar is to develop itself as a networking conduit between the Muslim and non-Muslim world, as they believe business collaboration can generate greater prosperity and mutual understanding. Established in 2004, WIEF gives particular focus on investing in women and the young; understandable given the high levels of unemployment among these two categories in Muslim countries.

The Muslim world's economic performance is generally dire. Despite making up one-fifth of the world's population, it produces a measly 7% of its output. Much of the discussion at the WIEF revolved around the global economic meltdown and its impact on Muslim countries that are now facing economic contraction, job losses and greater poverty due to the reckless model of unfettered market liberalism. With the interconnectivity that comes with globalisation, no state is immune. The systemic failure of the current banking model has generated much more official interest in Islamic finance. Shariah-compliant finance is based on financing secured against underlying tangible assets and involves risk-sharing between the parties in the pursuit of genuine commercial activities, rather than profiteering from paper instruments whose trail often led back to highly leveraged low-quality debt (better known now as toxic debt). There was a widespread view among those attending (including non-Muslims) that Islamic finance could provide one possible way out of the current malaise and become an important foundation in a new, more stable world economic order.

One official pointed out that it is not the labeling of products as "Islamic" that is the solution, as it is perfectly possible for a shariah-compliant bank to create sophisticated financial products that end up mirroring the conventional system. What is needed is ethical standards for the financial system based on transparent risk assessments and controlled debt levels. Whether such a model of greater fairness and integrity should be necessarily labelled with the exclusive term "Islamic" is a separate debate. Gordon Brown yesterday, in his speech to Congress, spoke in similar terms when he said that "markets should be free but never values-free, that the risks people take should never be separated from the responsibilities they meet".

The conference showed the efforts the Muslim world is making to help pull the world out of recession. Indonesia itself is home to the world's largest Muslim population, the third largest democracy and the fourth largest population, at 230 million. It is also a member of the G20. Its stable democracy and impressive economic growth over the last decade has marked Indonesia out as a front-line state in the west's greater desire for a more respectful engagement with the Muslim world after the Bush years.

Indonesia is seen as a possible template of how to deal with Muslim democracies and markets, new and old. In her recent visit to Jakarta in February, Hillary Clinton asked colleagues whether Indonesia held lessons for Pakistan, a state with the sixth largest population but far less stable. Given the different role Islam plays in Pakistani and Javanese culture and public life it is not immediately clear what those lessons might be. Indonesia is also strategically important given its commanding presence over the narrow Strait of Malacca, through which supertankers transport Middle Eastern oil to the Pacific Rim. There is great excitement here that President Obama may choose Jakarta to deliver his promised address to the Muslim world from a Muslim capital, the home of his childhood school.

The way out of the current economic crisis will require innovative thinking and a meeting of minds. The WIEF provides one such forum.

News Focus: Indonesia to export super quality rice in March

By Eliswan Azly

Jakarta (ANTARA News) - Having succeeded to record a surplus of over 2.7 million tons of rice in mid 2008, Indonesia will start to export super quality rice to some Asian countries such as Japan, Malaysia, Brunei Darussalam, Hongkong and Timor Leste.

Mustafa Abubakar, the Director of the National Logistic Agency, here on Wednesday said at the begininig, Indonesia will start exporting super rice to Japan, the volume of which was about 100,000 tons per year in March or April.

"However the export of rice to Japan will be conducted everymonth. As the first step, we concentrate more on exporting super quality rice and then the medium rice will follow the suit if the national target to produce 40 million tons of hulled rice or 63 million tons of unhulled rice can be achieved in 2009," he said.

If the national target to produce 40 million ton of rice in 2009 can really be achieved, there will be a surplus of rice between 3 to 4 million tons. "If allowed, we can export super and medium rice at least 3 million tons to Asian countries like Malaysia, Brunei Darussalam, East Timor for medium rice," he said.

The rice can be categorized into super quality rice, if the percentage of the broken is only within a range of ziro to five. . It can be either Cianjur, Pandan Wangi, Padi Mulia or aromatic rice. In the meantime, the broken of medium rice is between five to ten percent.

In Indonesia, rice plays a crusial role, as 97 percent of the whole population in this world largest archipelagic country consumed rice, it could be seen from the ratio of rice consumed by an individual in this world largest archipelagic country.

An Indonesian consumes 139 kilo of rice per year, while a Malaysian only consumes 83 kilos per year and 50 kilos per year for a Japanese.

The price of super quality rice is about USD1 to USD2 per kilo or around US$400 per metric ton. If the export could reach a level of one million tons in this year, practically Indonesia will earn about USD400 million from the export of rice, Abubakar said.

"On January 7, we signed an agreement with two importers and a local company in East Java to arrange the issuance of a permit from the Trade Ministry for the rice exports," he said.

In addition to Japan, according to Mustafa, some other ASEAN countries had also requested for the Indonesian rice, but of medium quality in 2009. "They are the Philippines, Malaysia, Timor Leste, and Brunei Darussalam, but we are still waiting for adequate rice supply to meet local consumption which can be calculated from June to September 2009."

"The four countries have tendered their formal and informal orders through their respective consuls in Jakarta for the import of the Indonesian," he said, adding Indonesia planned to export one to 1.5 million tons of rice of medium quuality.

However, Mustafa admitted that he was not in a position to decide on the rice export plan. He could only make a proposal, because the relevant authorities have left the matter to the Trade Ministry on the condition that Indonesia reached a rice overproduction of three million tons.

According to him, if the production of unhusked rice in 2009 reaches the projected 63 million tons, it is predicted that there will be a big overproduction, paving the way for rice exports to the Philippines, Malaysia, Timor Leste and Brunei Darussalam.

In the meantime, the Central Bureau of Statistics (BPS) last year projected Indonesia`s dry unhusked rice production at 59.88 million tons, up by 2.72 million tons due to an expansion of the land of the harvest by 237,610 hectares and an increase in productivity of the rice fields by 130 kg/hectare.

In 2007, Indonesia`s dry unhusked rice output rose by 4.98 percent or 2.70 million tons from 2006, enabling the country to enjoy a surplus of 1.5 million tons, while the country could only enjoy a surplus of about 50,000 tons. But in 2009 the surplus is expected to reach over three million tons.

Earlier, Director General of Food Crops Sutarto Alimoeso expressed optimism over Indonesia`s ability to record a surplus of over 2.7 million tons in 2009 following a BPS prediction of an increase in the country`s rice output in 2009.

Sutarto said he would ask the National Land Agency (BPN) to allow the rice growers to use idle land. "We have millions of hectares of idle land. However, our farmers cannot make use of them," he said.

Although Indonesia has become self-sufficient in rice and had a rice overproduction in 2008, the country is still considering rice exports on a regular basis.

Agriculture Minister Anton Apriyantono said last year Indonesia had no intention to export the commodity in large quantities, although many countries had asked Indonesia for the staple.

But, the minister said the government would not impose a ban on rice exports, but merely put a limit to volume and type of the rice for export.

The rice surplus will be handed over to the National Logistics Agency for storage.

The ministry had issued a regulation that only Bulog is authorized to export rice. The board can also import the staple if its stock has started declining from 1 million tons.
It said exporters are only allowed to export sticky rice after obtaining an approval from the foreign trade director general at the trade ministry.

The ministry said the regulation was needed to stabilize rice prices in the domestic market and protect the interest of the public, as rice is a staple food in Indonesia, with a population of over 230 million.

Meanwhile, Trade Minister Mari Elka Pangestu said the government was drafting a regulation on the export of a number of foodstuffs which are in a surplus, including rice. Under the regulation, rice of a certain quality could be exported while the government is committed to securing stocks and stabilizing prices in the domestic market.

"The government is committed to keeping the price of the staple at Rp4,750 to Rp6,000 per kg so that it will not burden the people," Pangestu said.

"The price of rice in the world market is relatively high but as long as the domestic price is maintained at a stable level and stock is adequate, the situation will remain secure," Mari added.

Indonesia realizes promotion to Middle East still insufficient

Jakarta (ANTARA News) - Indonesia realizes that its promotion to the Middle East is still insufficient causing investment from the region remains low.

The country`s state enterprise minister, Sofyan Djalilm said here on Monday "we are still under-promoted in the Middle East so that only few investors from the region know the country while the potentials in our country are huge."

The minister said at a press conference on the 5th World Islamic Economic Forum that a Middle Eastern investor told him over a lunch that afternoon about his wife who asked what for when he told her he would leave for Indonesia, impressing that the country was still unknown.

However, Sofyan who is also a deputy chair of the meeting said the investor immediatelly called his wife upon arrival here to ask her to come to Jakara telling her that "shopping malls here are no less superior than those in the US or Europe."

So, they really did not know much about Jakarta, the minister said.

In view of that he hoped the holding of the World Islamic Economic Forum would make Middle Eastern investors know the country better and interested to invest in the country.

He said he also hoped the forum would lead to agreements as well as their implementation.

Another deputy chair of the meeting, Tanri Abeng, shared the minister`s view that Indonesia still insufficiently conducted promotion to the Middle East. In view that he said he planned to conduct better promotion efforts.

"At the end of the meeting on March 4 we would conduct an exhibition on Indonesia to promote the country`s potentials. Moreover more participants attended the meeting this time and more than half of them came from the Middle East. The number of attendees was larger than it was in Malaysia before," he said.

This means, he said, that Middle Eastern investors began to be interested in the country. "It has never happened before that the number of delegates reaching more than one thousand," he said.

He said now was the opportunity for Indonesia to attract foreign investors. "They used to look at the US and Europe because of their financial sector but now when the West is in crisis they turned to the East," he said.

He said investment in Eastern countries would not be the same as in the West. "In the Eastern countries it would go more to the real sector while in the West it would go the financial sector. This means an opportunity for us that have a huge pontential in the sector," he said.

The chairman of the South African Chambers of Commerce and Industry, Ibrahim E Patel, said the event was an important forum for investors to know more about Moslem countries.

"Here we would discuss substantial platforms stressing on partnership cooperation. We know that trade knows no state borders, politics, religions and races," he said.

Indonesia has just sold $3b in dollar bond

Aditya Suharmoko and Mustaqim Adamrah , The Jakarta Post

Indonesia has just sold US$3 billion in medium-term notes, the country’s largest ever dollar-denominated bond sale, to help plug the growing state budget deficit.

The Southeast Asia’s largest economy has sold $2 billion of 10-year bonds, with a yield of 11.75 percent, and $1 billion of five-year bonds, with a yield of 10.5 percent, according to a Finance Ministry statement Friday.

The yields of 10-year notes and five-year notes are 8.759 percentage points and 8.474 points respectively, higher than similar-maturity US Treasuries, Bloomberg reported.

Anggito Abimanyu, the ministry’s head of fiscal policy, said the bonds would help cover the budget deficit of Rp 139.5 trillion, equal to 2.5 percent of gross domestic product (GDP), and increase forex reserves.

“Our trade surplus has declined;, while there has been a capital outflow from our investment portfolio. The source from where we can maintain our forex reserves is foreign debts,” said Anggito.

He added the yields were within the government’s “benchmark”.

Finance Ministry director general of debt management Rahmat Waluyanto said the yields rose due to a “repricing of risk” as the perception of global economic risks rose.

“Yields rise not only for Indonesia’s bonds; but also Brazil’s, between 300 basis points and 400 basis points,” he said.

He added the government decided to go on with the sale to plug the deficit and to develop market confidence in Indonesia’s bonds.

“We are maintaining investors’ confidence. They have a high enthusiasm, we don’t want to disappoint them.”

The notes triggered total orders of $7.25 billion from 200 investors.

Anggito said the government initially wanted to sell between $1.5 billion and $2 billion of bonds, but decided to sell $3 billion as the market situation would likely become worse later this year, thus increasing bond yields.

The bonds are expected to be settled within a week, increasing Indonesia’s forex reserves, which stood at $50.87 billion as of January.

The government also plans to issue dollar sukuk (Islamic bonds). No details have been announced yet.

“For a while, we won’t issue global bonds anymore. But in our pipeline, there are global sukuk, samurai bonds and drawdown options, which we can use,” said Rahmat.

“The global medium-term notes were issued at the right time. Samurai bonds will be issued in June, considering those need preparation for the first issuance,” he added.

In the 2009 budget, the gross amount allocated to issue of bonds is Rp 99.7 trillion — but the government should look for another Rp 44.5 trillion in loans after the budget was adjusted earlier this week to accommodate extra efforts to shield the economy from the global crisis.
Under the budget adjustment, the government will allocate Rp 73.3 trillion to the stimulus package.

Rahmat said the government had so far issued Rp 56 trillion in bonds.

Bank Indonesia (BI) governor Boediono said the bonds would add to the central bank’s forex reserves, increasing the amount of dollars available to strengthen the rupiah.

“The bilateral swaps and government borrowings will strengthen our ammunition,” he said.

Separately, economist-turned-lawmaker Dradjad H. Wibowo said the bond yields were too high.
The Philippines recently sold $1.5 billion of 10-year notes with a 8.5 percent yield, Bloomberg reported, 3.25 percent lower than Indonesia’s 10-year bonds.

“When the global market is bearish, the government shouldn’t have insisted to issue global medium-term notes,” said Dradjad.

Clinton ends visit with charm offensive

By Erwida Maulia , THE JAKARTA POST , JAKARTA

US Secretary of State Hillary Clinton looked to waste no time during her tightly arranged visit to Indonesia, which wound up Thursday.

Her mission to put a new face on US foreign policy, one that was friendlier and willing to be a “better listener” than ever, has seemingly been accomplished.

The new US secretary of state did everything from holding serious talks with Indonesian leaders, to sharing her fancy for classical music in front of a local TV audience.

After meeting with Indonesia Foreign Minister Hassan Wirajuda, visiting the ASEAN Secretariat and having dinner with civil society figures on Wednesday, Clinton appeared on a local TV show, paid a courtesy call on President Susilo Bambang Yudhoyono and visited a slum area in Jakarta on Thursday before departing to South Korea later in the afternoon.

On Thursday morning, Clinton, her face wreathed in smiles, appeared in music program Dahsyat on local broadcaster RCTI, in which the relaxed former first lady shared with the audience her love of classical music.

“I like listening to classical music while working. It's soothing... My husband usually listens to jazz and rock and roll,” Clinton said when model-cum-presenter Luna Maya asked her about her favorite music.

Clinton also said she enjoyed the Beatles and the Rolling Stones when she was younger.
However, she turned down a request to sing, saying, “The problem is people will leave when I sing.”

The TV show also presented famous local singers Melly Goeslaw and Agnes Monica, who asked for a photograph with Clinton.

RCTI corporate secretary Gilang Iskandar told newsportal okezone.com that Clinton enjoyed the talk about music so much that she forgot the interview should have lasted for only 10 minutes instead of 20.

Gilang said RCTI had worked hard to secure Clinton’s approval to appear on the TV show.

During the meeting with President Yudhoyono, Clinton reiterated Washington's willingness to build a “comprehensive partnership” with Indonesia, while praising the latter’s “leading roles” in a number of environmental issues.

She also said predominantly Muslim Indonesia could serve as a model of how Islam, democracy, modernization and the fulfillment of women’s rights could all grow in harmony, according to presidential spokesman Dino Patti Djalal.

Yudhoyono, in return, asked the US to play a bigger role in resolving the Palestine-Israel conflict and to take the lead in global environmental issues.

The President called his meeting with Clinton a “wonderful” and “productive” meeting.

Also present at the 45-minute talk were Acting Coordinating Minister for the Economy Sri Mulyani, Coordinating Minister for the People's Welfare Aburizal Bakrie, State Secretary Hatta Rajasa and Cabinet Secretary Sudi Silalahi.

Through Clinton, the President renewed his invitation to US President Barack Obama to come to Indonesia on the sidelines of the upcoming APEC meeting in Singapore.

Obama has said he would visit a major Muslim nation, in a move aimed at reconciling the US and the Islamic world.

After bidding farewell to Yudho-yono and before stepping into a waiting car, Clinton greeted enthusiastic journalists lined up nearby and shook hands with the lucky ones, leaving others disappointed.

She then paid a visit to Petojo Utara, a residential area in Central Jakarta, where USAID has built a public toilet equipped with a waste treatment facility.

Clinton walked on foot to reach the toilet, during which dozens of neighborhood school students, who had been watching, waved at her. She waved back at them.

However, Clinton missed the chance to have a taste of fried bananas and fried tempe prepared by local housewives.

She stayed only around 15 minutes in Petojo before heading to the airport.

During a press conference at the neighborhood state junior high school SMPN 38, Clinton said she had planned this brief visit as part of her people-to-people approach to diplomacy.

“Through this kind of interaction, I can find out what the public feels and can encourage them to better their quality of life,” she said.

Due to her tight schedule, Clinton failed to attend a cooking demonstration that local housewives had organized.

Obama's former Indonesian school basks in his glow

By Jennifer Henderson

JAKARTA (Reuters) - Pupils at Barack Obama's former school in Indonesia skipped classes Wednesday, as a scrum of guests and media invaded the institution where the new U.S. president studied for two years.

Obama spent four years in Indonesia after his American mother, Ann Dunham, married Indonesian Lolo Soetoro following the end of her marriage to Obama's Kenyan father.

"Having Barack Obama as the president will automatically increase the motivation and spirit in pursuing education," said Hasimah, the principal of State Elementary School Menteng 01.

But the intense media interest Wednesday made it hard for pupils to focus on studies.

Sixth-grader Zulkifly said he had been interviewed three times while waiting for his parents at the front of the school.

"There's lots of media here," said the 11-year-old, dressed in a neat white shirt with traditional Indonesian batik patterns.

Indonesians have followed Obama's political fortunes closely and the media has been packed with stories on his old school and the houses he lived in while in the country.

Obama was six years old when he moved to Jakarta, where he went to a Catholic school and then Menteng 01.

The Menteng school briefly become a source of controversy after a U.S. conservative magazine reported on its website in 2007 that it was a radical madrasa, or Islamic school. The school in a leafy suburb is in fact attended by pupils of many faiths.

A former classmate of Obama attending a ceremony at the school to mark the inauguration said she wanted to meet him again.

"If we had a chance we just want to have a chit chat with him, remembering the old days," said Sandra Sambuaga Mangie.

"We don't want to talk about politics or current issues. Just talk about his time in Indonesia, as our classmate," she added.

Classmates and teachers in Jakarta remember Obama affectionately as a child who loved to draw cartoon characters.

Fourth-grader Ceyco said she wished Obama success for the future but had no desire to emulate his path into politics.

"In the future I want to become an international karate athlete," she said. There has been speculation about whether Obama will visit Indonesia, the world's most populous Muslim country.
Obama promised to improve U.S. ties with the Muslim world in his inauguration address Tuesday, after tensions that followed the September 11 attacks and the wars in Iraq and Afghanistan.

A message from Obama was read out on his behalf Tuesday at a ball in a posh Jakarta hotel to celebrate his inauguration.

"My childhood years in Jakarta provided me with many lessons and memories that I carry with me to this day," he said.

(Additional reporting by Lenita Sulthani; Writing by Ed Davies; Editing by Sanjeev Miglani)

Hillary Clinton recognizes Indonesia`s economic role

Jakarta (ANTARA News) - Senator Hillary Rodham Clinton in her statement when testifying as secretary of state nominee at the US Senate`s Foreign Relations Committee in Washington DC, last Tuesday (jan. 13), recognized Indonesia`s role in dealing with the global economic crisis.

"We know that emerging markets like China, India, Brazil, South Africa, and Indonesia are feeling the effects of the current crisis. We all stand to benefit in both the short and long term if they are part of the solution, and become partners in maintaining global economic stability," she said.

"For too long, we have merely talked about the need to engage emerging powers in global economic governance; the time to take action is upon us. The recent G-20 meeting was a first step, but developing patterns of sustained engagement will take hard work and careful negotiation," she added.

Indonesia`s President Susilo Bambang Yudhoyono attended the G-20 Summit on the global economic crisis which was held in Washington DC, last November 2008.

In her statement Hally Clinton also recalled President-elect Obama`s mother, Ann Dunham, who had worked in Indonesia from late 1960s until early 1990s. Clinton called Ann Dunham as a pioneer in micro finance in Indonesia.

"As a personal aside, I want to mention that President-elect Obama`s mother, Ann Dunham, was a pioneer in micro finance in Indonesia. In my own work on micro finance around the world - from Bangladesh to Chile to Vietnam to South Africa and many other countries - I`ve seen firsthand how small loans given to poor women to start small businesses can raise standards of living and transform local economies," she said.

"President-elect Obama`s mother had planned to attend a micro finance forum at the Beijing women`s conference in 1995 that I participated in. Unfortunately, she was very ill and couldn`t travel and sadly passed away a few months later. But I think it`s fair to say that her work in international development, the care and concern she showed for women and for poor people around the world, mattered greatly to her son, and certainly has informed his views and his vision. We will be honored to carry on Ann Dunham`s work in the months and years ahead," she said.

The Senate is expected to confirm Hillary Clinton as the new US Secretary of State after the presidential inauguration of Barack Obama on January 20, 2009.

Indonesia is planning an Islamic bond, or sukuk, worth $1 billion

HONG KONG (Reuters) - The start of the year has seen a flurry of deals in Asia's debt and equity markets, and bankers expect similar bursts of activity throughout 2009 as sellers price their offerings attractively to tap pockets of demand.

In less than two weeks, big investors led by Bank of America (BAC.N) and Royal Bank of Scotland (RBS.L) managed to sell $5.7 billion worth of shares in two Chinese banks at discounts ranging from 7 to 12 percent to their last traded prices.

More such sales are expected as strapped investors look to raise cash but much will depend on volatile stock markets.

On the debt side, Export-Import Bank of Korea (KEXIM) this week sold a $2 billion bond that drew $4.4 billion in orders. That followed a $1.5 billion sovereign bond issue by the Philippines that was priced to sell and drew even greater demand.

With plenty of supply coming to market, buyers have the upper hand on pricing. As this week's selldown in stocks shows, demand can be fleeting.

"There are significant refinancing requirements in 2009 and this will generate plenty of transaction flow. Investors are willing to invest but as we have seen on some of the recent block trades, discounts are still wide," said Ken Poon, head of capital markets origination for Citigroup in Asia-Pacific.

"Whenever there is stability in the market you will see activity, but issuers will need to be flexible to take advantage of windows of opportunity," said Poon, whose firm's deals this year include the KEXIM bond as well as a $1 billion commercial paper sale by a unit of India's Oil & Natural Gas Corp (ONGC.BO).

Another lender, state-owned Korea Development Bank, is looking to raise at least $1 billion in a bond issue as early as next week. Indonesia, meanwhile, is planning an Islamic bond, or sukuk, worth $1 billion in February, sources have told Reuters.

BUYERS' MARKET

Thanks to the big block trades in bank shares, equity volumes in Asia so far this year are eight times those in the United States, according to Thomson Reuters data.

The pickup in debt sales is global and driven by highly-rated issuers.

"Investors are hungry, but at a price. There's quite a bit of cash on the sidelines," said Khiem Do, head of the Asia multi-asset group at Baring Asset Management.

"How long can you hold on to Treasury yields that are offering 1 or 2 percent, especially when corporate bond yields and equity yields are very attractive to relative to cash and government bonds?" he added.

KEXIM paid 6.25 percentage points over the midswaps rate, a key pricing indicator on debt deals. Only eight months ago, the state lender paid 1.38 percentage points over the same rate for a 750 million euro-denominated five-year issue.

Even so, a debt syndicate banker at a large bank said market conditions have improved substantially since the end of 2008.

China now considering RI important political partner

Beijing, (ANTARA News) - China now considers Indonesia as one of its most important partners in the political field as reflected in the increasingly improved relations between the two nations over the past five years, an Indonesian diplomat said.

"In the past five years, China come to regard Indonesia as one of its most important and strategic partners," Deputy Chief of Mission at the Indonesian Embassy Mohamad Oemar said here on Wednesday.

He said since the resumption of Indonesia-China diplomatic ties in 1990, the two countries` bilateral relations, particularly in the political field, had been growing rapidly.

The relations were further fostered after President Susilo Bambang Yudhoyono and his Chinese counterpart President Hu Jintao signed a strategic cooperation agreement in 2005 as a basis for the two nations to increase their cooperation, he said.

The Indonesian diplomat said one of the indications that China now regarded Indonesia as an important partner was the fact that the number of top Chinese officials visiting Indonesia for various purposes was increasing.

The Chinese officials included those of the Chinese Communist Party such as Prime Minister Li Keqiang who met with President Yudhoyono and Vice President Jusuf Kalla.

Likewise, many Indonesian officials had also paid visits to China such as those made by Kalla, House Speaker Agung Laksono and others.

Indonesia dan New Zealand to resume FTA talks in March

Jakarta (ANTARA News) - The negotiation on Free Trade Agreement (FTA) between Indonesia and New Zealand is expected to be resumed in March 2009 after the signing of the ASEAN-Australia-New Zealand FTA agreement in February, 2009.

"We hope that the negotiation could be resumed soon after the signing of ASEAN-Australia-New Zealand FTAB. Hopefully it could be done in March," Director General for International Trade Cooperations of the Trade Ministry Gusmardi Bustami here on Saturday.

Gusmardi denied allegation that there had been such a tension between the two countries which caused a cancellation of the negotiations concerned. "It is not true there is no friction. We have agreed to continue the talks between the two countries` trade ministers."

According to him, the follow up negotiation between the two countries would focus on the details of agreements ever made by the two trade ministers.

In the meantime, ASEAN-Australia-New Zealand FTA launched in November 2004 will expire at the end of this year.

In the agreement, Indonesia will scrap import duty for 10,397 post tariff or 93.17 percent of the total post tariff as of 2009 till 2020. As many as 645 others are to have their tariff lowered, while other 117 will be subject to an exception.

Australia will abolish all kind of import duties from ASEAN as of 2009 till 2015 and at least 91,77 percent of the total post tariff will be lowered in 2009-2010 period, while New Zealand will remove 97,4 percent of the total post tariff at a stage of 80 percent in 2009 and 90 percent in 2012.

During the negotiation, Australia will target the opening of Indonesian automotive products, while New Zealand will open beef market and diary products.

For automotive, Indonesia will render a different treatment between Australia and Japan. The agreement on automotive sector with Australia will take into account the agreement between Indonesia and Japan.

"Little bit different, because what is asked by Australia like passenger car we have to allow it in 2020 and not in 2018 like that with Japan," Gusmardi said.

Indonesia asked the two countries to accelerate the abolition of tariff for textile product and garment which is currently standing in a range of 5 to 17.5 percent from 2009 or 2010 for Australia and 7.75 to 19 percent for New Zealand starting 2017 or 2018.

In addition, Australia also provided an investment in agribusiness to review and arrange the capacity of development working programs as well as to push an investment in meat sector and diary products.

New Zealand also offered a facility like the sending of 100 Indonesian workers under a working holiday scheme, job opportunity for 100 cooks, 20 slaughters for halal certified meat and 20 teacher assistant for Indonesian language.

Central bank to continue promoting sharia-based economy

Boediono, Bank Indonesia (BI) governor

Jakarta (ANTARA News) - Bank Indonesia (BI) governor Boediono said here on Tuesday that the central bank would continue promoting the shariah-based economic system in the country.

"There must be no doubt that BI supports the development of shariah-based economy," he said in his speech when installing executive board members of the Shariah Economic Community (MES).

He said right now the world was looking forward to a shariah economy following its disappointment over the present economic system that had led to an economic crisis.

He said BI did not only support from outside but also inside the organization for the development of the economic system. "At least two BI deputy governors are board members of the Shariah Economic Community. So it is guaranteed," he said.

Two BI deputy governors, namely Muliaman Hadad, is general chairman of the MES, and Siti Fadjriah as MES' deputy to the advisory board.

Muliaman Hadad after his instalment said he would continue developing the shariah-based economic system because it could be one of the supporting factors of the country's economy.

"I think it needs to be articulated again that the shariah-based economic system is not only an economic foundation for preventing an economic crisis like we are experiencing now but it is also a solution to a crisis," he said.

Former MES chairman Aries Muftie meanwhile said that according to a World Bank report in 2020 Indonesia would be one of the countries with a strong economy.

"And according to the report the development of the country's economy is supported by its shariah-based financial sector," he said.

In view of that, he said the development of the shariah-based economic system had to be boosted to support national development.
,
"Right now the shariah-based economy only contributes not more than three percent of the country's total economy. It has to be further boosted to support the national economy," he said.

Source : Antara

Who Are Muslims?

So, what role does religion really play in Muslims' lives? According to Gallup Polls in 2001 and 2005-2007, of countries with substantial or predominantly Muslim populations, majorities in many countries (several in the 90% range) say that religion is an important part of their daily lives. Sizable percentages rate "having an enriched religious/spiritual life" as an aspect of life that is essential, that one cannot live without. Asked what they admire most about the Islamic world, the No. 1 response from significant percentages of populations in countries as diverse as Turkey, Saudi Arabia, and Indonesia is "people's sincere adherence to Islam."

Many regard religion as a primary marker of identity, a source of meaning and guidance, consolation and community, and essential to their progress. Majorities of both men and women in many predominantly Muslim countries want to see Islamic principles, Sharia, as a source of legislation. These respondents have much in common with the majority of Americans who wish to see the Bible as a source of legislation. Both groups emphasize the importance of family values and are deeply concerned about issues of social morality. In fact, what respondents in the Muslim world and a significant number of Americans say they admire least about Western civilization is an excessive libertinism in society.

Islam is not to its adherents what it might appear to outside observers: simply a restrictive shell of rules and punishments. To many Muslims, it is a spiritual mental map that offers a sense of meaning, guidance, purpose, and hope. Vast majorities of residents in predominantly Muslim countries say their lives have an important purpose (90% of Egyptians, 91% of Saudis).

The importance of religion is reinforced by what Muslims say about their traditions and customs, which also continue to play a central role in their lives. When asked, "Are there traditions and customs that are important to you, or not?" majorities in many predominantly Muslim countries say "yes": Jordan (96%), Saudi Arabia (95%), Turkey (90%), and Egypt (87%). This contrasts sharply with percentages of those answering "yes" to the same question in the United States (54%) and especially in European countries such as the United Kingdom (36%), France (20%), and Belgium (23%).

If religion is regarded by so many Muslims as a core life value, beyond the sensational images and religious rhetoric of extremists, what is this faith that has won the devotion of so many? What does it mean to be Muslim? What principles call more than a billion people, with different languages and cultures, spread all over the world?

Based on the largest and most in-depth study of its kind, Who Speaks for Islam? What a Billion Muslims Really Think presents the remarkable findings of the Gallup Poll of the Muslim world, the first ever data-based analysis of the points of view of more than 90% of the global Muslim community, spanning more than 35 nations.

An excerpt from the book Who Speaks for Islam? by John L. Esposito and Dalia Mogahed

Obama…New Chapter in American History

A couple of years ago Barack Obama was just a junior senator of the Democratic Party. Today he wrote a new chapter in the history of the United States by becoming the first-ever African American occupant of the White House.
It was no easy task going from that to this.

When the race for the Democratic Party president ticket began, Senator Hillary Clinton was not just the front-runner but the presumptive nominee.
She had the money and the Party establishment, being a former first lady and wife of arguably one of America's most loved and respected presidents, Bill Clinton.
She had a long history of public service and an unmatched seniority within the Democratic Party and the Senate.

The young, charismatic Illinois senator also had to steer his ship through some tough storms.
Obama's middle name, Hussein, and a picture of him in a traditional Somali garb during a visit to his father's homeland Kenya in 2006 stoke the "Obama is a Muslim" flames.

For weeks, he had to put up with news reports and rival remarks of being a Muslim in disguise.
Obama is the son of a Muslim-turned-atheist Kenyan father and a white American mother that did not practice religion.
Born in Hawaii, he lived from ages 6 to 10 in Indonesia with his mother and Muslim stepfather.
Obama, who describes himself as a proud follower of the Trinity United Church of Christ, also stumbled for weeks over inflammatory sermons by Rev. Jeremiah Wright, his pastor for the last 20 years.
Even his wife Michelle was not spared the campaign fire. He recently had to come out in force against Republicans using her as punch-bag.

Making History

But Obama's hope and change message resonated across a country wearied by the Iraq war and stalked by fears of recession.
He beat all the odds being overwhelming elected the first black American president in a transformational election that will reshape US politics and reposition the United States on the world stage.

Obama's victory was greeted with euphoria by a vast crowd gathered in his home city of Chicago, as his supporters, screamed, waved American flags as they waited for him to arrive to deliver his victory speech.
The 47-year-old will be inaugurated the 44th US president on January 20, 2009, in an historic inauguration that will complete a stunning ascent to the pinnacle of US and global politics from national obscurity just four years ago.
The presidency also marks a stunning social shift, with Obama, the son of Kenyan father and white mother from Kansas, the first African American president of a nation still riven by racial divides.

Forty-five years after civil rights icon Martin Luther King laid out his "dream" of racial equality, Obama's election broke new barriers and may have helped heal the moral wounds left by slavery and the US civil war.
He rocketed to prominence at the 2004 Democratic presidential convention with an electrifying call for unity.
"There is not a Black America and a White America….there's the United States of America."
Source : Islam Online

Business Oportunity in Indonesia

The Indonesian government is targeting growth of the electronics industry around 13.15 percent in the period 2005-2009 with a target investment reached 2.5 billion U.S. dollars.

"Industrial consumption of electronics and components industry is a priority that will be developed in accordance with the National Industry Development Policy", said Minister of Industry, Fahmi Idris on the celebration of the achievement of the production of television (TV) Sharp to-10 million units in Jakarta on Thursday.

He said that currently there are approximately 230 companies in the field of electronics that operate in Indonesia. The government view the electronics industry, including leading the industry with a target of average growth in 2005-2009 reached 13.15 percent.

"To achieve these targets required additional investment of not less than 2.5 billion U.S. dollars, with hopes to create 15,000 new job opportunities per year," said Fahmi.

For that, he continued, the government has been working to create a conducive climate, especially related to taxation, fiscal incentives, and employment laws.

In addition, the government also refers to the electronics industry during this, there are many on the island of Java and Batam more spread to other areas through the regulation number 1 of 2007 to give fiscal incentives for certain industries and / or in certain regions, especially outside Java Island.

However, responding to question the government's plan and the elimination of the decline in Luxury Goods Sales Tax (PPnBM) a number of electronic products, Fahmi only hope that there are stages to this is the last one, given that the proposal has been around two years, but have not signed the Minister of Finance.

Meanwhile, Director General of Industrial Equipment and Transportation on (IATT)) • DEPPERIN Budi Darmadi said until now the target of investment of 2.5 billion dollars during 2005-2009 has reached around 70 percent.

"Until now about 70 percent of the target investment in the field of electronics has been reached. A number of companies from Japan, South Korea, and China, such as Sharp, LG, and Changhong, has been to instill and increase investment in Indonesia," he said.

President director of PT Sharp Electronics Indonesia (SEID) Fumihiro Irie said on the same opportunity that this year the government has added approximately 140 billion investment.

"Around Rp100 billion, we have investasikan to add new production lines refrigerator, because there is a large demand from the market in the country," he said.

While the rest, information Irie, is used to increase the production capacity of washing machines. He was optimistic Indonesia's electronic market will still grow next year with growth of around 20-25 percent, reported by Republika News.

Do Muslims Want Democracy and Theocracy?

According, John L. Esposito and Dalia Mogahed, cutting across diverse Muslim countries, social classes, and gender differences, answers to our questions reveal a complex and surprising reality. Substantial majorities in nearly all nations surveyed (95% in Burkina Faso, 94% in Egypt, 93% in Iran, and 90% in Indonesia) say that if drafting a constitution for a new country, they would guarantee freedom of speech, defined as "allowing all citizens to express their opinion on the political, social, and economic issues of the day."
However, while acknowledging and admiring many aspects of Western democracy, those surveyed do not favor wholesale adoption of Western models of democracy. Many appear to want their own democratic model that incorporates Sharia -- and not one that is simply dependent on Western values. Actually, few respondents associate "adopting Western values" with Muslim political and economic progress. Abuses in the name of Sharia have not led to wholesale rejection of it.
In our data, the emphasis that those in substantially Muslim countries give to a new model of government -- one that is democratic yet embraces religious values -- helps to explain why majorities in most countries, with the exception of a handful of nations, want Sharia as at least "a" source of legislation.
• In only a few countries did a majority say that Sharia should have no role in society; yet in most countries, only a minority want Sharia as "the only source" of law. In Jordan, Egypt, Pakistan, Afghanistan, and Bangladesh, majorities want Sharia as the "only source" of legislation.
• Most surprising is the absence of systemic differences in many countries between males and females in their support for Sharia as the only source of legislation. For example, in Jordan, 54% of men and 55% of women want Sharia as the only source of legislation. In Egypt, the percentages are 70% of men and 62% of women; in Iran, 12% of men and 14% of women; and in Indonesia, 14% of men and 14% of women.
Ironically, we don't have to look far from home to find a significant number of people who want religion as a source of law. In the United States, a 2006 Gallup Poll indicates that a majority of Americans want the Bible as a source of legislation.
• Forty-six percent of Americans say that the Bible should be "a" source, and 9% believe it should be the "only" source of legislation.
• Perhaps even more surprising, 42% of Americans want religious leaders to have a direct role in writing a constitution, while 55% want them to play no role at all. These numbers are almost identical to those in Iran.