Malaysia and Indonesia to voice out Rohingyas issue

Hua Hin, BANGKOK (ANTARA News/Bernama-OANA) - Malaysia and Indonesia will raise the issue of stateless Rohingyas Myanmar at the Asean Summit, said Foreign Minister Dr Rais Yatim Thursday.

He said Myanmar must understand that the issue was not only their problem, but also that of the other Asean member countries who were at the receiving end.

"I am myself will be very inclined to discuss this matter when we have the discussion on matters pertaining to Asean. Having said that, the difficulty is immense as no specific authority is in charge of this exodus," Rais told Malaysian reporters at a press conference here, Thursday. He is here for the 14th Asean Summit.

Rais said there were not less than 14,000 registered Rohingyas in Malaysia and expected the actual number to be more.

"We are made to understand that this people are encouraged to leave the shores within a situation that is questionable," he said.

Hence, the issue needed to be raised, especially at the foreign ministers level discussion and "perhaps at a later date we will resume other forms of cooperation (on the matter)," said Rais.

He said it would be better for Myanmar to be open about it, especially on how the matter could be dealt since these people were coming from Myanmar.

Rais said some form of assistance also needed to be set up by the United Nations to handle the issue, especially if Myanmar did not own up to the community which would than become a worldwide problem.

"So, it is pertinent for us to engage with the UN in this matter," he said.

Rais also said Malaysia, which will be represented by Prime Minister Abdullah Ahmad Badawi at the Asean Summit, wanted the human rights issue to be discussed in the spirit of Asean.

He said Malaysia felt that the human rights aspect in the Asean region should be slightly different from the universal aspect which was currently being structured according to the United Nations schedule.

Malaysia was also endeavouring to raise the Palestinian issue at the Summit although it was not related to Asean, he said.

Rais said the Prime Minister was expected to play an active role in discussions on the world economic and financial crisis, and the Asean leaders were also expected to sign several important documents at the Summit.

The documents included the Blueprint On Asean Security Community, Socio-Cultural Community Blueprint, and the Asean Integrating Workplan.

Indonesia's Matahari plans sukuk, conventional bonds

JAKARTA, Feb 25 (Reuters) - Indonesian retailer PT Matahari Putra Prima Tbk (MPPA.JK) said on Wednesday it plans to raise a total of 500 billion rupiah ($42 million) from the sale of Islamic and conventional bonds in April.

The world's most populous Muslim nation is trying to tap its huge market for Islamic-compliant products. The government recently raised 5.55 trillion rupiah from its first retail sukuk issue, well above the 1.7 trillion rupiah targetted.

In a prospectus published in a newspaper, Matahari said it plans to sell 200 billion rupiah of ijarah sale-and-leaseback sukuk and 300 billion rupiah of conventional bonds.

It has appointed PT HSBC Securities Indonesia, PT Indo Premier Securities, and PT Ciptadana Securities as underwriters.

Islamic bonds do not pay interest, which is banned as usury under Islamic law, and are structured as profit-sharing or rental agreements underpinned by physical assets. ($1 = 11,930 rupiah) (Reporting by Dicky Kristanto, editing by Sara Webb)

Malaysia, Indonesia agree to strengthen commodity prices

Kuala Lumpur (ANTARA News) - Malaysia and Indonesia have agreed to work together to strengthen commodity prices in particular palm oil and rubber prices amid the current sagging world prices.

Malaysia and Indonesia jointly account for 85 percent of global palm oil production and 40 percent of natural rubber production.

Both countries in a joint statement released here Wednesday said they have also agreed to take appropriate measures to ensure stable prices in particular for palm oil.

"These measures include managing palm oil stocks and reducing supply through
replanting programmes," said the statement.

Plantation Industries and Commodities Minister Peter Chin Fah Kui and Minister of Agriculture of the Republic of Indonesia Dr. Ir. Anton Apriyanto met Wednesday to discuss bilateral cooperation on the matter.

The Indonesian Minister is in the city to attend the Developing-Eight (D-8) Ministers Meeting.

For palm oil, the ministers have agreed to accelerate replanting of oil palm trees which are above 25-years old, implementation of biofuel programme, increasing domestic demand for crude palm oil and jointly engage major importing countries of palm based methyl ester in addressing non-tariff barriers for the exports of biofuel.

Malaysia has implemented the blending of five percent palm based methyl ester with fossil diesel.

Indonesia implemented a minimum of one percent blending programme in the public transportation sector and a minimum of 2.5 percent blending in the industry and commercial sector. These minimum percentages will be increased to 2.5 percent in the public transportation sector and five percent in the industrial and commercial sectors.

Both ministers also want to exchange production and stock level data on a regular basis to facilitate stock management and promote palm oil through engaging the related legislators of importing countries.

As for rubber, both countries will accelerate replanting of rubber trees aimed at managing the supply of natural rubber.

"Malaysia has revised upwards the original target of replanting rubber areas to 50,000 hectares in 2009 from 32,000 hectares. Indonesia is replanting 55,000 hectares with rubber in 2009," the statement was quoted by Bernama as saying.

Meanwhile, both countries also agreed to control the expansion of new planted area for rubber, encouraging the reduction of tapping frequency.

The ministers hope that these measures will reduce price volatility and contribute towards stability of both palm oil and natural rubber prices in the longer term.

Sharia economy ‘a hope’ amid crisis, BI governor says

By Erwida Maulia , The Jakarta Post

Sharia-based banking and economy pose “no risk” of financial crisis if implemented correctly, because unlike the conventional system, they reject speculative practices without underline transactions, Bank Indonesia said Wednesday.

Speaking during the opening of the 2nd Sharia Economy Festival, BI Governor Boediono said what could be learned from the ongoing global economic crisis was that the financial sector could not be based on speculative practices and should be based instead on real business activities.

He added that many financial instruments were now no longer based on underline transactions, which in turn had created a massive bubble.

“Due to its internal dynamics, the bubble gets larger and finally blows; this is when a crisis occurs. But we know this is not the case with sharia banking,” Boediono told the hundreds in attendance at the BI-organized festival at the Jakarta Convention Center.

“Right from the start, it does not allow for speculative transactions and products without the existence of underline assets.

“For that reason, if implemented properly, we can say that sharia economy and banking pose no risk of a crisis. Amid the ongoing global crisis, the presence of sharia banking is actually a hope.”

The festival will run from Feb. 4 to 8, and is aimed at promoting sharia banking and financial products.

Boediono said the conventional banking system should go “back to basics” and follow the principles of Islamic banking by not “playing” with speculative activities.

“A bank’s main function is to facilitate and finance activities related to the provision of goods and services for the community, which are real activities. These are the basics of banking operations that both conventional and sharia banks must cling firmly to,” he said.

President Susilo Bambang Yudhoyono, who officially opened the five-day event, commended the sharia economy for being able to survive amid the global economic meltdown, citing sharia banking’s annual growth of an average of 35 percent over the last few years.

He urged sharia economic players to continue supporting national economic development agendas.

“I hereby ask sharia banking to play a more active role in supporting the development of the real sector through more efficient savings and investments. We want not only Muslims, but also all citizens to enjoy its benefits,” Yudhoyono said.

He added the amount of financing provided by the country’s Islamic banking institutions had grown from a mere Rp 5.53 trillion in 2003 to Rp 27.94 trillion in 2007 and Rp 38.19 trillion in 2008.

The 2008 figure constituted about 3 percent of the total amount of national bank financing.
Yudhoyono said the amount of assets managed by the country’s sharia banks also rose from 1.4 percent of the country’s national bank assets in 2005, to 1.6 percent in 2006, 1.8 percent in 2007 and 1.8 percent, or about Rp 50 trillion in 2008.

The central bank governor said there were currently 1,470 sharia bank offices across the country, and that they had disbursed Rp 326 billion in loans for micro- and small-scale firms as of the end of 2008.

Indonesia reports strong demand for first retail sukuk

By Sonya Angraini and Adriana Nina Kusuma

JAKARTA, Feb 10 (Reuters) - An Indonesian finance ministry official on Tuesday reported strong demand for the country's first retail sharia-compliant bonds, or sukuk, as investors expect more interest rate cuts.

"So far demand has been quite strong," Dahlan Siamat, the finance ministry's senior official in charge of sharia debt, told Reuters. He declined to elaborate.

Standard Chartered said in a research note this week that about 57 percent of the 1.7 trillion rupiah ($144.4 million) target amount, or 969 billion rupiah, had been sold.

Proceeds from the bond issue will help plug the state budget deficit, which is forecast at 2.5 percent of GDP this year.

"Early indications of the interest level in Indonesia's first domestic sukuk offering are encouraging with sales reported at 57 percent of the 1.7 trillion issuance target," Standard Chartered said in the report.

"As this is the inaugural offering, demand for this asset class is untested and a successful placement will, at the margin, take some pressure off the Finance Ministry's issuance pipeline for the year."

The one-month offering period for the sukuk ends on Feb. 20, with 13 selling agents appointed to sell the bonds.

Indonesia, the world's most-populous Muslim country, has recently accelerated its efforts to develop its so it can tap a wider investor base.

The three-year sukuk has a 12 percent coupon, while one-year bank deposits yield between 6.75 and 10 percent. For details on the sukuk please double click on [ID:nJAK392542].

The finance ministry has declined to reveal its target for the retail sukuk issue. The ministry sold 4.7 trillion rupiah worth of 7-year and 10-year sukuk to institutional investors in August 2008, falling short of its target of 5 trillion rupiah because of inflation concerns.

Inflation has eased in recent months, mainly because the government has cut subsidised fuel prices three times since the beginning of December.

Trimegah Securities (TRIM.JK), one of the selling agents, said demand for the sukuk had been strong. Under the current scheme, the finance ministry sets certain sales target for the selling agents.

"We had on Friday already exceeded the target given to us. We are seeking approval from the finance ministry to raise the target," Trimegah debt director Desimon said.

"The return is quite attractive, the maturity is not too long and BI (Bank Indonesia) rate is likely to fall further," Desimon said, referring to the benchmark overnight rate BIPG.

Indonesia's central bank cut its key interest rate by 50 basis points to 8.25 percent in February, the third cut in three months, and indicated it may cut rates again to support economic growth.

Sukuk comply with sharia, or Islamic law, which bans charging interest. Investors are instead paid income derived from assets such as rent from property or commercial transactions such as trade in goods and services. ($1 = 11,770 rupiah) (Editing by Sara Webb)

Source : Reuters

RI`s 2008 export growth exceeds target

Jakarta (ANTARA News) - Indonesia`s non-oil/gas exports in 2008 grew 17.16 percent to US$107.8 billion from a year earlier, the Central Bureau of Statistics (BPS) said.

The 2008 export growth exceeded the government-set target of 14.5 percent, BPS Deputy Chief Ali Rosidi said here on Monday.

Vegetable and animal oils, nearly 80 percent of which came from crude palm oil (CPO) topped the list of the country`s non-oil/gas exports last year, contributing 14.46 percent of the total non-oil/gas exports, he said.

He said vegetable and animal oil exports rose to US$15.53 billion in 2008 from US$10.23 billion the year before.

Mineral fuel came in second with a value of US10.67 billion, accounting for 9.89 percent of the total non-oil/gas exports. In 2007, mineral fuel exports stood at US$7.12 billion.

Machinery and electrical appliances contributed 7.51 percent of the total non-oil/gas exports with US$8.09 billion compared to US$7.52 billion the previous year, he said.

Rubber and rubber-based product exports made up 7.04 percent of the total non-oil/gas exports, increasing to US$7.59 billion in 2008 from US$6.25 billion a year earlier, he said.

Mechanic appliances contributed 4.84 percent of the total non-oil/gas exports with a value of US$4.68 billion in 2008 from US$5.21 billion in 2007, he said.

Compared to November 2008, the export of the five different commodities in December 2008 declined in the range of US$14 million to US300 million, he said

Source : Antara

BI unconcerned about foreign banks` entry inti micro sector

Jakarta (ANTARA News) - Bank Indonesia (BI) Deputy Governor Mulyanaman D Hadad said the central bank was not concerned about the entry of foreign banks into the micro and small business sector in Indonesia.

"I don`t think we have to be concerned. I think it is the duty of all of us to improve the competitiveness of local banks," he said in response to a question on the entry of foreign banks into the small business sector in Indonesia.

He said the foreign banks` entry into the micro business sector would have a positive impact because it would enable small people to gain access to financing sources.

"There is a positive aspect to it because we still do not know when small people can have access to financing sources if we wait for domestic banks to help them out," he added.

He said that now only about 40 percent of the people had access to banks.

Hadad said that the entry into micro businesses of foreign banks was expected to bring not only capital money to them but also knowledge and managerial skills so that it would be beneficial for the development of banks in this sector.

He said that actually almost half of banking credits were provided for the micro, small and medium-sized businesses (UMKM).

Banks which provided credits for the UMKM sector were state-owned such as BRI which had units in rural areas.

BRI has a composition of credit provision where 80 percent went to the UMKM sector.

The BRI step has been followed by Bank Danamon, whose controlling shares are owned by Singapore`s Themasek Holdings through Asia Financial (Indonesia) Pte Lite.

Danamon built Danamon saving units in various rural areas which are intended to provide financial access for micro and small businesses.

Indonesia's PLN raises 2.2 trln rph from bond sales

JAKARTA, Jan 9 (Reuters) - Indonesia's state electricity firm PT Perusahaan Listrik Negara (PLN) has raised 2.2 trillion rupiah ($201 million) from conventional and Islamic bond issues, a securities firm involved in the deals said on Friday.

Indonesia's monopoly power supplier had aimed to raise 1.5 trillion rupiah from the bond issues, to help finance investment in power transmission.

It has about 24,000 MW of generating capacity but most of its plants are old, so daily output is far below capacity.

Sonny Thendian, head of trading sales at PT Indo Premier Securities, said that investors had been attracted by the high yield and potential for bond prices to rise as the central bank continued to lower interest rates.

Bank Indonesia (BI) cut its key interest rate BIPG by 50 basis points to 8.75 percent, more than expected, on January 7.

"The highest demand came from insurance firms and pension funds," said Thendian.

PT Indo Premier Securities, PT Danareksa Sekuritas, PT Trimegah Securities Tbk (TRIM.JK) were underwriters for the issues.

PLN raised 1.44 trillion rupiah from two series of fixed-rate conventional bonds. The five-year bond, maturing in 2014, has a coupon of 14.75 percent, while the seven-year bond, due 2016, has a coupon of 15 percent.

It also raised 760 billion rupiah from two series of Islamic bonds, or sukuk, which were issued under the "ijarah" or leasing arrangement.

One series, due in 2014, has a coupon of 14.75 percent, while the other series, due in 2016, has a coupon of 15 percent.

Islamic bonds do not pay interest, which is banned as usury under Islamic law, and are structured as profit-sharing or rental agreements underpinned by physical assets. ($1 = 10,950 rupiah) (Reporting by Sonya Angraini; Editing by Sara Webb)