Facilitated by a largely unquestioning media, Indonesian President Joko Widodo’s government has become a master at the game of smoke and mirrors, which in its simplistic form is all about convincing the public that things are happening when they really aren’t.
The protracted negotiations with US mining giant Freeport McMoran Copper & Gold are a good example, but going back to the presidency of Susilo Bambang Yudhoyono the deceptive game-playing has covered everything from beef to natural resources to infrastructure.
While not new, the official obfuscation and embellishment of the truth has become more apparent as the 2019 legislative and presidential elections approach and Widodo and his palace spin doctors perceive the need to display his accomplishments.
Yudhoyono played this game back in mid-2011 when the Australian government suspended live cattle exports to Indonesia over animal welfare issues, and Jakarta decided some payback was in order by ordering a ban of its own.
Over the next two years, it slashed cattle imports by half and sought to convince consumers that the local industry could fill the gap when rising prices – and one of the lowest per capita beef consumption rates in Asia — clearly showed it could not.
Fast forward to the much-vaunted China-backed US$5.8 billion Jakarta-Bandung fast-rail project, once seen as the showcase of Widodo’s ambitious infrastructure program and now stalled over land acquisition issues that should have been foreseen.
Getting it started hasn’t been for the want of trying. Widodo attended a ground-breaking ceremony in January 2016, only to see Transport Minister Jonan Ignasius call a halt to the project five days later because of several “unresolved issues.”
Widodo and the Chinese weren’t amused. In July, the same month the construction permit for the project was finally issued, Ignasius — the former, highly successful chief executive of state-run railway Kareta Api — was unceremoniously sacked.
The president should have already learnt his lesson. In mid-2015, he had presided over the ground-breaking of the US$4 billion, Japan-funded Batang power station in Central Java, only to discover local farmers were still refusing to sell a key patch of land.
The courts finally resolved that one, but the railway still isn’t going anywhere despite the efforts of State Enterprise Minister Rini Soemarno, who showed up last July for yet another ground-breaking event – this one a tunnel.
It takes a lot to beat the whole Freeport saga, though, starting with last year’s framework agreement which was hailed at the time as a major victory for the Widodo government in forcing the company to agree to divest 51% of its shares in its local subsidiary.
Maybe so, but no-one seemed to notice that the devil was in the small print. In fact, the Indonesia media failed to point out at the time that the crucial questions of valuation and management control had yet to be settled.
Little surprise then that the negotiations continue, interspersed on frequent occasions with reassuring pronouncements by senior government officials that a final, final deal is just around the corner. It has been a long corner.
So far, there have been at least four government-imposed deadlines, all based on the extension of Freeport’s permit allowing it to continue exporting copper concentrate from its high-altitude Grasberg mine in Papua’s Central Highlands. The next one is in June.
Refusing the permit would clearly hurt the company’s profits, but it would also cut deeply into government revenues and, perhaps more importantly, lead to worker lay-offs that could spark unrest in the country’s already volatile Papua region.
In the latest show-and-tell, the government last week ceremonially signed a memorandum of understanding under which it will hand over 10% of the Freeport Indonesia shares it still needs to acquire to the Papua provincial administration.
The government spin machine has also recently turned to eastern Indonesia’s Marsela natural gas project, which for reasons even some senior Indonesian politicians can’t figure, Widodo wants to be developed on a remote, sparsely-inhabited island.
Joint venture partners Inpex and Shell have been dragging their feet, arguing that only an offshore facility makes sense, given the undersea terrain and a lack of existing infrastructure.
With the project seemingly in limbo, the government announced earlier this month that the partners were working on detailed plans for an onshore plant that would be finished by the end of this year. Tellingly, there was no word from either company.
“The officials are talking on behalf of the company, without the company knowing anything about it,” says one Indonesian oil veteran. “That’s politics, but for me as an industrialist it is very troubling.”
The French oil giant Total has maintained a similarly stoic silence since the state-run Pertamina oil company claimed the firm wanted back into the Mahakham gas field, which it had to leave when its contract expired last December.
In fact, with little money to maintain the Mahakham, it is the government that has been offering Total a slightly higher 39% participating interest to entice it to return as a partner in the field it ran for more than 40 years.
Widodo also adopted Yudhoyono’s cattle chicanery, part of an economic self-sufficiency program in which, with little planning and a lot of wishful thinking, Indonesia was hoping to produce all its own beef, rice, sugar, corn and soybeans.
In 2015, it was proudly announced that the proportion of beef imports to total consumption had dropped from 31% to 24%, without anyone noting that Indonesians were eating just 2.7 kilograms a year, the lowest per capita rate in the region.
A year later, that figure had shot back up again to 32% and last year it increased yet again to 41% with the price of beef at US$10 a kilogram and officials acknowledging the obvious: that Widodo’s five-year self-sufficiency target was now unattainable.
Again, that has a familiar ring to it. By importing rice, seen as almost a crime in some nationalistic quarters, past governments have often been forced to admit (if anyone is listening) that Indonesia’s supposed self-sufficiency in rice is nothing but a myth.
That would have former President Suharto, who did achieve rice self-sufficiency back in the early 1980s with careful planning and a slew of coordinated programs, rolling over in his grave.
Sooner or later, the smoke and the mirrors will inevitably lift to reveal hard realities.
barang2 semua ganti harga ya Bun….yang sering belanja aja yang ngerti….
Jawaban untuk artikel sampah "The Real Smoke and Mirror" John McBeth di Asia Times
Saya masih ingat tahun 1994, kata teman saya, Pak Harto panggil saya bersama beberapa pengusaha ke Cendana. Beliau mengatakan bahwa dengan terpaksa mencabut izin 45 ruas toll yang sudah diberikan kepada pengusaha. Beliau tidak menyalahkan pengusaha yang gagal membangun. Tetapi justru beliau menyadari bahwa kelemahan pejabat pemerintah dan pengusaha indonesia adalah dalam hal mendapatkan financial resource di luar negeri. Yang ada semua bisanya hanya narik uang dari bank dalam negeri. Bagi, pak harto kalau bank dalam negeri terseret membiayai proyek infrastruktur maka itu akan membuat bank akan runtuh, Maklum infrastruktur ekonomi itu bukannya tidak feasible tapi jangka waktu pengembaliannya lama. Jadi harus real investor yang bisa membiayainya.
Di era SBY masalah keterbatasan financial resource ( sumber daya keuangan ) masih terjadi. Walau pemerintah sudah membentuk perusahaan patungan world bank dan ADB sebagai fund provider dan collateral provider seperti SMI tetapi belum bisa sebagai solusi provider. Pembangunan infrastruktur masih lambat sekali realisasinya. Dan masih tergantung penuh pada APBN> Barulah di Era Jokowi, pemerintah menciptakan berbagai skema pembiayaan yang bersifat solusi total. Yang hebatnya skema pembiayaan ini walau kadang melibatkan APBN namun tidak sampai mengganggu stabilitas fiskal yang harus dijaga agar kurs dan moneter stabil dan tidak melanggar pagu yang ditetapkan oleh UU. Terbukti Jokowi bisa menyelesaikan setahap demi setahap sampai akhirnya membuat orang tercengang.
Kemampuan pemerintah Jokowi membuka katup sumber daya keuangan eksternal melalui pasar keuangan global adalah bentuk pengakuan pasar bahwa pemerintah Jokowi kredibel secara financial. Kemarin PT Jasa Marga (Persero) Tbk., resmi mencatatkan obligasi komodo senilai Rp4 triliun, di London Stock Exchange. Tahun 2018 ini PELINDO akan menerbitkan global bond sebesar USD 1 miliar di pasar global. Dan masih banyak lagi yang dilakukan swasta yang nilainhya ratusan triliun dan semua dana berasal dari luar negeri. Itu sebagian hutang dan sebagian lagi B2B. Namun tidak ada jaminan dari pemerintah atas resiko B2B ataupun hutang. Ini murni pasar yang bekerja. Artinya kinerja rasio yang menjadi ukuran , bukan politik.
Keberhasilan Jokowi menekan Freeport tunduk dengan UU Minerba dan akhirnya tunduk dengan skema divestasi yang ditentukan pemerintah , kebehasilan Jokowi menghadapi kasus Mahakam , Masela yang melibatkan investor keluar dunia , itu suatu fakta bahwa para team Jokowi tidak lagi melihat investor asing adalah raksasa sehingga pantas punya bargain position. Mengapa ? karena investor asing juga dapatkan dana dari pasar, dan indonesia bukan lagi pemain pinggiran untuk mengakses pasar uang dunia. Jadi jangan lagi investor datang bergaya punya uang. Team Jokowi adalah mereka yang punya akses kepasar uang dan jago atas berbagai skema investasi..Makanya berita The Real Smoke and Mirror" -Artikel yang ditulis John McBeth di Asia Times, dianggap sampah oleh pemain pasar uang. “ berita Itu konsumsi untuk orang bego."
-Diskusi Dengan Babo –
dalem, Om
ASIA TIMES IS FAKE???????? CHEAP MEDIA
Ragsa EA do u really wanna know? ????
Muhammad Shalahuddin My original response to your point 1 may be deleted by admin. Here it is again. Disclaimer: I didn’t choose Jokowi in last election. I am pro truth, not pro Jokowi. I acknowledge that all Indonesian Presidents have worked hard to improve our country. Though none is perfect. Life is hard, but I don’t blame any president. Just Berusaha. There is a saying: "Let us not be haters, let us celebrate success." Now, lets discuss the facts:
1. From google, wikipedia page on Indonesia, and this article. http://www.insideindonesia.org/the-life-and-death-of-indonesia-s-mineral-export-ban and the graph below from https://tradingeconomics.com/indonesia/gdp-growth-annual
I believe we can see the big picture on the effect of glocal economic forces. We can see that SBY’s era was marked by GLOBAL MINING BOOM (2003-2013), driven by demand of mineral resources by China. This was a period of extraordinary growth, especially for mineral resource exporting countries. Any president could easily achieve a high growth number. Which SBY did quite well, 7%. Then came GLOBAL FINANCIAL Crisis in 2008. However, due to continuing demand from China, Indonesia didn’t feel the pain until a few years later. Which shows decline in growth in 2011 (as comparison, Australia, another mineral exporting country, decline started in 2012).
Then the trouble starts in 2014, when SBY commenced ban on export of mineral ores. As a result, export income plummetted, and growth continue to decline. (I actually favour the ban, as the intention is for Indonesia to have smelting capability, not merely as exporter of mineral ores).
As you can see, in the graph below and its accompanying article, the 5% growth in 2017 is the highest in 4 years (2013). Which highlights that the decline in growth started at the end of SBY’s era (2011-2014). Mainly due to end of Global Mining Boom and Global Financial Crisis. I think, given the economic climate he inherited, Jokowi and Kabinet Kerja have done very well to maintain economic growth of 5%+. Where the world average is only 3%. In countries with comparable GDP to Indonesia, that is G20 countries, only India and China grows better than Indonesia, 6%. The rest are around 3%. Note: we must compare countries with similar GDP, as it is much easier for countries with smaller GDP to increase its growth number.
Additionaly, the international world acknowledges Indonesia’s economic achievement by raising its rating to BBB, from B 10 years ago.
So, in the big picture, despite all the minor set backs, promises that were not fulfilled (due to reasons to benefit the greater goods of the people), Indonesia economic management during Jokowi era is something to be proud of. Even Australia with its advanced technology, facilities and human resources only have stagnant growth of 3%.
Muhammad Shalahuddin And I just found out in my source above, here it is again, http://www.insideindonesia.org/the-life-and-death-of-indonesia-s-mineral-export-ban.
A theory of: why Jokowi relaxed SBY’s mining export ban? To prepare PT Antam’s financial conditions to take over Freeport.
Muhammad Shalahuddin I hope you can see that I am pro truth, not pro Jokowi. It’s just that I can see the track record of Jokowi’s work. In the big picture, the international world acknowledges that Indonesia economy improves, where other nations are stagnating.
I acknowledge that Prabowo have great dreams for Indonesia. But his track record is not that good yet. If Prabowo can provide similar track record as Jokowi, in his politically significant role as Ketum of Gerindra, in particular, stomping out corruption in Jakarta, and pushing for better management in Jakarta government (to achieve a more strategic and integrated governance & planning, instead of wasting money on non-primary issues). I can seriously choose Prabowo next election. But the way I see it, even if/after Jokowi is selected for second term as president, Susi Pudjiastuti still has a better track record than Prabowo, in improving Indonesia. Talk is easy, real work is not so easy. I do hope Prabowo can produce a better track record than Susi, to start with.
And, lastly, I commend you for going through the link that i used at tradeeconomics. I really appreciate an educated debate. You actually put effort to investigating the facts, not just accepting someone else’s post.
Muhammad Shalahuddin 3. Oil is just one factor. There are other exports, strategic decisions that have even more significant factors. Regarding the effect of mineral export ban, I originally found out from Wikipedia page about indonesia. https://en.wikipedia.org/wiki/Indonesia.
Muhammad Shalahuddin 2. No, Indonesia economy starts to decline in 2011. SBY era. See the graph above, due to after effect of Global Financial Crisis, and end of Chinese Mining Boom.
Muhammad Shalahuddin Disclaimer, I didn’t choose Jokowi in last election. I fully acknowledge that all of Indonesians presidents have tried to make Indonesia a better place, though they are not perfect. Life is hard, but I will not blame any president for it. No need excuse, just berusaha. As one once said: "Let us not be haters, let us celebrate success." Now, let’s discuss the facts:
1. Source: http://www.insideindonesia.org/the-life-and-death-of-indonesia-s-mineral-export-ban
After some googling, wikipedia, and article above, I believe I found the big picture: SBY era was during the GLOBAL MINING BOOM 2003-2013. Which was driven by demand for mineral ores by China. Which is why Indonesia under SBY had very high growth (this was extraordinarily prosperous time, where most presidents/countries would do well, regardless, which SBY did quite well). Then GLOBAL FINANCIAL CRISIS hits at the end of 2008. Which you can see in the graph below, a sudden dip in growth. However, China managed to sustain its growth, and as such, mineral ore producers countries did not feel the effect of GFC until a few years later (e.g. Australia growth starts declining in 2012, Indonesia growth starts decliing in 2011). Indonesia economy was in deep trouble, Because in 2014, when SBY’s MINERAL ORE EXPORT BAN took place, to promote smelting of ores in our own country (a very good initiative by SBY in my opinion, just need flexibility in implementation). Obviously, from 2014 on wards, Indonesia’s export is significantly reduced, and hence the lowest growth that follows. For Jokowi to improve Indonesia’s growth to 5+% is quite an achievement. In fact, the article below mentions, that this is the highest growth in the past 4 years (i.e. "since December quarter 2013). Here is the link, you can check yourself. https://tradingeconomics.com/indonesia/gdp-growth-annual
If you read my sources carefully, you can see the graph doesn’t lie. Historically, that’s the effect of global economic forces.
And secondly, take Australia, with similar GDP, and all the educated ppl they have, all the effort they took, it only manages 3% growth. So, President Jokowi and his cabinet have worked really hard and really well to improve Indonesia’s economy.
Adrian give me a break you idiot. Only idiot who still believe that esemka was an achievement. Esemka didn’t exist at the first place. It was just a toy, an illegal copy and resemble from several japanese cars. The first esemka was combining honda crv’s front with isuzu panter’s back. Also it was done by china manufacture which well known for illegal copying.
On 2013 it was said that esemka sold 7000units?? Have you ever seen at least one of them running in the road??
https://m.detik.com/finance/industri/d-2242167/diproduksi-massal-mobil-esemka-laku-7000-unit
Thats fu*king hoax is the only reason for jokowi’s fan to maintain their ignorance. It has been 5 years since the esemka first appearance, how is it going?? You all who claim yourselves as jokowi supporters, why you didn’t buy one rather than buying japanese or european cars???
And now the fact that another election is coming, so again the esemka hoax shall be used one more time. But what??? Hoax are merely still hoax, nothing changes
https://m.cnnindonesia.com/teknologi/20180131095544-384-272824/komparasi-esemka-garuda-1-dan-mobil-china-foday-landfort
https://news.okezone.com/read/2016/05/04/15/1380711/pabrik-perakitan-mobil-esemka-hanya-miliki-30-karyawan
My advice is, just keep eating jokowi’s regime hoaxes as always, it is good for maintaining your ignorances.
Agus Nizami 8000 cover army? can you prove it?
Your comment is a haters believe about this governments. And it seems you will close your positive mind for this governments. Esemka, and others you said is in progress.
Just analyze all comments, then you will see how pro-regime people attacking the truth broadcasters
1. Buyback Indosat -> Failed
2. No Rice Import -> Failed
3. Kick Freeport -> Failed
4. No Foreign Debt -> Failed
5. National Car, Esemka -> Failed
6. Slim Cabinet -> Failed
7. Keep Oil Price Low -> Total Fail
Paijo Gopala well said sir…
analisa seperti ini kok diributkan sih ?
Your report is provocative but lack of sounding data. The reason why Jokowi decided put Masela Block to onshore only to develope regional economy. Masela island, (https://id.wikipedia.org/wiki/Pulau_Marsela) certainly habitated by real person, contrary to your claim, "inhabited island". Are you afraid Australian Security would be corrupted ?
Maybe you shoul do a more detailed survey on The Indonesian social, economic and cultural in relation to get more comprehensive undertstanding of the situation. Beef price for example. The key of high price is the High cost of production and long chain of trade (http://www.bbc.com/indonesia/indonesia-41264222). In the Ramadhan month, the price would rise significantly, though the supply is enough. Therefore you can not judge the price in Ramadhaan for the real price. You can use Google Trend to analysist.
You should also note, the rice import has terminated for two years (2016 to 2017). The Corn Import has dropped off signifcantly since 2014 (https://goo.gl/b4Zi2f)
I figure, your "the smoke and the mirrors" should be reviewed again.
Titiek Titiek: Titiek Titiek: what kind of global crisos in jokowi’s era??
Let me mention some facts:
1. Indonesia is still a developing country, and with the population as many as 4th in the world, it is not a surprise at all to have a growth 5%. Even there is no president at all naturally it could be achieved. If there is someone must be praised of indonesian economy he must be SBY era who succeed to elevate indonesia GDP from 200s on his early lead to up to 900s on his final work. Also remember that indonesia entered G20 also in SBY’s period. Yet the jokowi’s brainless fans still denying all of predessors’ work as of as everything good must be jokowi’s work.
https://tradingeconomics.com/indonesia/gdp
2. Indonesia’s performance are declining starts from jokowi era up until now so we only have 5% now.
3. If we use world economic as an excuses, remember that the world oil price was at it’s highest of history at SBY era, and now the world oil price is at the lowest price of decades at jokowi era. And how about to compare it to domestic oil price?? It is so lame and shameful to mention. And which one did you mention as global crisis? Yeah there was one global crisis in 2008 called leman brother economy’s shock.
U dont know anything…think again before writting…and dont drink while u writting…
Go home dude youre drunk, or just a mere blind