Phil Turtle
National President

President's Column

Dear Members and Friends,

Once again this month proved that in our “new normal”, there’s never a dull moment in the world of International Trade. Having unceremoniously dumped the Trans-Pacific Partnership (TPP) in January, President Trump is now actively considering for the US to rejoin what has become TPP 11.

For our own IA-CEPA, negotiators continue to meet and hope to resolve some so-far troublesome issues. Indonesia’s Trade Minister Enggartiasto Lukita, is certainly optimistic and pressing for a conclusion this year, and all involved with Trade and Investment between our countries, would hope this optimism is warranted and rewarded. The IA-CEPA has now been some time in the making, and it would be disappointing for it to fall-short despite the journey it has been on.

In the background though a number of initiatives are underway that promise to improve the situation for foreign investors in Indonesia, including a revision of the working visa system to give two years instead of six months, continued effort for a one stop shop licensing system across Indonesia for business, and a drive to allow 100% foreign ownership of universities (a regulation is in progress). In the University sector, whilst there is some way to go to realise this opening up, it would be an opportunity lost if Australian Universities were not poised to take “first mover advantage”.

“Winning in Indonesia” web event by Telstra/telkomtelstra. L-R Kevin Cryan (Austrade), Erik Meijer (telkomtelstra), Phil Turtle (AIBC) with moderator Peter Fray (UTS)

Recently AIBC was delighted to partner with Telstra and telkomtelstra on a widely viewed web event, with the theme of “Winning in Indonesia” and how businesses can best prepare themselves for success. I was delighted to have the opportunity to participate in this event, alongside telkomtelstra President Director Erik Meijer, as well as Kevin Cryan, Senior Investment Specialist, Services & Technology with Austrade.

The number of participants, and steady stream of questions from the on-line audience, demonstrated strong interest in this theme. This event was recorded, and will be available for viewing soon.

This month also saw the soft-launch of a new Group within AIBC, focused on serving the needs of our Members in the Resources and Energy sectors. Please read below for more detail, and how to get involved if this is your field of interest.

Phil Turtle
National President

Lunch with Tom Lembong, Chairman of the Indonesia Investment Coordinating Board (BKPM) and the Asia Society

 
The Australia Indonesia Business Council (AIBC) was kindly invited by Philipp Ivanov, CEO of the Asia Society in Australia, to a working lunch with H. E. Tom Lembong, Chairman of BKPM on Wednesday 21st March in Melbourne. On behalf of AIBC, Dr Kathleen Turner, AIBC National Vice-President attended, accompanied by Murli Thadani, Special Advisor to the National Board of AIBC; Leith Doody, Advisor – Australia International Business; and Chris Leptos, Deputy Chairman of Flagstaff Partners. Additional attendees included representatives from IIPC in Sydney, plus they the new Indonesian Consul-General in Victoria & Tasmania, Ms Spica Tutuhatunewa.
 
Following Pak Tom’s attendance at the ASEAN-Australia Special Summit in Sydney alongside the President of Indonesia and his delegation, the lunch was an opportunity for the AIBC & Asia Society to discuss the outcomes of the ASEAN Summit and the latest developments in the negotiations of the Indonesia Australia Comprehensive Economic Partnership Agreement (IA-CEPA). In particular it was an opportunity to discuss how organisations like AIBC and the Asia Society can leverage off the ASEAN Summit and President Jokowi’s visit and sharpen and coordinate their focus on areas that matter most to the bilateral economic relationship.  
 
Tom lauded the relationship between Prime Minister Malcolm Turnbull and President Jokowi as one similar to the “Keating and Suharto era” which is well-known to have been one where the relationship was perhaps the closest between the two heads of government. He mentioned that President Jokowi was keen to have a conclusion to negotiations on the IA-CEPA agreement which is expected to be completed by the year end. In the meantime, Tom commented, as an example that foreign direct investment was being actively encouraged in Indonesia’s burgeoning film industry, which is expanding rapidly,  in large part to due to the growth of the middle class; as well as the booming tourism sector where Indonesia is improving its connectivity in a number of regions.
 
The discussion also centred on the importance of organisations like AIBC and the Asia Society to facilitate forums or dialogues with key decision-makers on key themes such as infrastructure and the ASEAN-Australian Infrastructure Cooperation Initiative. It was also agreed there is a commensurate need to raise awareness about complementary opportunities and change perceptions, considering persistent popular misunderstandings of the country, whilst also being open about Indonesia’s reformist policy versus the challenges foreign investors still face on the ground. Pak Tom indicated his willingness to being part of such dialogue and engaging the likes of AIBC to keep the Australian public informed of important policy developments relevant to Australian business.

(L-R)  Mr Chris Leptos AM - Flagstaff Partners, H.E. Pak Tom Lembong, Chairman - BKPM, Dr. Kathleen Turner - AIBC National Vice President & Leith Doody, International Business Adviser

Networking with H.E. Bapak Tom Lembong, Chairman - BKPM

Representatives from BKPM, Vic Government, Indonesian Consulate and AIBC.

Dr Kathleen Turner,
National Vice President

AIBC Biennial Conference 2018

Planning is underway for AIBC’s flagship event for 2018, the AIBC Conference to be held Nov 11-13 at the Surfers Paradise Marriott Resort & Spa, on Queensland’s world famous Gold Coast.

As part of early planning we are keen to hear any suggestions for topical themes and speakers, as well as from organisations keen to partner with us. Full details of sponsorship packages are available upon request.  

As preparations continue for AIBC’s Biennial Conference in November on the Gold Coast, please continue to look out for further announcements here in AIBCnews, via our AIBC National Twitter account and by following #aibc18.  We hope to see you there.

As you can see from the collected feedback from our last Conference in Perth, the event was a major success, and one we are looking to surpass.

Any enquiries can be directed to president@aibc.com.au

ACT Update

Opportunities for Defence Exports to Indonesia Briefing Function

The Australia Indonesia Business Council (AIBC) in conjunction with the Australian Industry Defence Network Chapter ACT (AIDN-ACT Inc.) and the Defence Council of the Australian Industry Group (AiG), are pleased to invite you to attend a briefing on the opportunities for defence exports to Indonesia.

The briefing will be held at the offices of PwC in Canberra on 15 May 2018.  Australia is ranked 19th in the world for defence exports, with the US our largest market accounting for around 51 per cent of exports, followed by Indonesia with 28 per cent of defence exports in 2017 (Defence Connect, 13 March 2018).

The Defence Exports Strategy was released by the Australian Government in early February 2018 and aims to move Australia into the top 10 defence exporters.  With the growing need for the Indonesian armed forces to update their equipment and systems this will present a significant opportunity for Australian exporters, particularly SMEs that are involved in global supply chains. INDO DEFENCE will be held 7-10 November 2018 in Jakarta and will provide an opportunity for defence exporters from a number of countries to display their equipment and services.  To read more on this event or to register, please click here.

Tony Mitchener,
ACT Chairman

QLD Update

Following a very busy February/March for the AIBC Qld, all things in March/April in Queensland were mainly focused around the Commonwealth Games on the Gold Coast with very few other events being staged during this time.

However, as always, AIBC Qld Vice Chair, David Widjaja, was still flying the flag for the AIBC and Australia/Indonesia relations.

David Widjaja, Vice Chairman of AIBC QLD accompanied Ibu Devi Suradji, Director Businesses Development and Marketing of PT Angkasa Pura 1 for Roundtable Meeting with The Right Honourable Lord Mayor of Brisbane, Councillor Graham Quirk.

PT Angkasa Pura 1 is currently looking after 13 airports on the Eastern side of Indonesia with approximately 85 million domestic passengers. Ibu Devi mentioned by 2019 with the new airports currently build they will be looking after 21 airports.

Prof. Bambang Subiyanto, Chairman of LIPI (Lembaga Ilmu Pengetahuan Indonesia/Indonesia Institute of Science) was visiting Brisbane to attend Indonesian Conference held by The University of Queensland.

LIPI and UQ has very close partnership and currently there are around 20 PhD students from LIPI joint research collaboration at UQ.

David Widjaja, Vice Chairman of AIBC QLD was recently invited by Janelle Chapman, Executive Director of TAFE Queensland International to their Private Suite at Gold Coast Commonwealth Games Athletics Final competition.

TAFE Queensland is the training partner of GC2018 and trained more than 15,000 volunteers for this big event.
 

Hugh Ritchie,
QLD Chairman

WA Update

Held in conjunction with the Indonesia Institute and K&L Gates, the AIBC WA Committee hosted Jewel Topsfield as our guest speaker who was the Fairfax Senior Correspondent in Indonesia for three years. The event was sold out with approximately 50 guests in attendance.

The new Indonesian Consul-General, Ibu Dewi Gustina Tobing also addressed the gathering. Jewel gave a very authentic and raw recount of her experience as a journalist in Indonesia and it became abundantly clear why she fell in love with Indonesia. Her recount of 3 years in Indonesia covered everything from business, politics, religion, and social issues (she even had the opportunity to interview President Jokowi!). It was an incredibly captivating story and is reflective of the diverse country that is Indonesia.  You can read more about Jewel’s stories and experiences in Indonesia here.

Jewel Topsfield in action
 

Ibu Dewi Gustina Tobing (Consul General) with Mike Spreadborough (MD - Nusantara Resources)

Chris Scott (K&L Gates) makes presentation to Jewel

AIBC WA would like to thank K & L Gates for hosting this event:

Julia Scott
AIBC WA Chairwoman

AIBC Launches Mining & Energy Group

The AIBC is pleased to have launched a ‘virtual’ National Mining & Energy Group to bring together members active in the industry sector. Its formation is the result of a recent survey of Victorian mining and energy companies who indicated a strong interest in networking with each other for business opportunities, to exchange information on their investments and operations within Indonesia and to direct attention through AIBC to policy issues affecting investment and trade. As members in the sector are spread across the country and their representatives are often travelling, the group will utilise the AIBC’s flexible digital communications technology for meetings. 

Group priorities include the AIBC’s mooted representation of Indonesia at the 2018 IMARC international mining conference and exhibition in Melbourne during 29 October- 1 November – an event earning additional global industry significance due to the parallel and connected meeting of the ICMM – and also input to the AIBC’s national conference later in November.  Participation in the group is open to all AIBC members active within the mining and energy sectors, including METS (mining and energy technology and services supplies).

Victorian Committee member, Geoffrey Gold, has taken leadership of this group and can be contacted at 0466 972 8322 or gmgold@aseanstrategic.com.

Waste to Wealth Health - Finding Solutions

Plastic and other waste management challenges threaten to impact Bali’s lucrative tourism industry. The Australian Consulate-General in Bali is hosting a Waste to Wealth seminar on 5 June 2018 to bring together government, the private sector and civil society to discuss innovative solutions in managing waste. This is an opportunity to showcase Australian expertise in this field, to meet local authorities and develop new partnerships. Further information is provided here. If you’re interested in receiving an invitation to attend the seminar, email media.bali@dfat.gov.au.

IndoView

JFK Airport Booted out of World top 20

New York’s John F. Kennedy International Airport is no longer ranked among the 20 busiest in the world, thanks to the rush in Asia.

Among those pushing out JFK was New Delhi’s Indira Gandhi International Airport, which made its debut on the table last year at No. 16, according to Airports Council International rankings released Monday. The Indian airfield was also the fastest-growing on the list, with passenger traffic rising 14 percent, followed by 10 percent at China’s Guangzhou, which climbed two notches to No. 13.  To continue reading this article, click here.

New Disclosure Provisions for Beneficial Ownership

In his latest article, Bill Sullivan of Christian Teo & Partners, looks at new rules for the treatment of beneficial ownership.

"Indonesia has, for the first time, recognized that entities may have beneficial owners who are different from the legal or registered owners of those entities.

In conjunction with the recognition of beneficial ownership, Indonesia has moved to require all entities to disclose details of their beneficial owners.

Although not a primary objective, it is possible the new beneficial ownership rules may make it increasingly untenable for foreign investors to use nominee arrangements to avoid compliance with Indonesia’s foreign ownership restrictions in respect of the local energy, infrastructure and mining industries among others.”

To read this article in full, click here.

Indonesia Market Update

In their March 2018 edition of “Indonesia Market Update”, Morelink Asia Pacific provide news updates across many key sectors including the Indonesian economy, investment, trade, retail, agrifood, manufacturing, automotive, ICT and infrastructure sectors.

To read this update, click here.

Roy Morgan Summary

Roy Morgan Indonesian Consumer Confidence rose 2.2pts to 156.3 in March 2018. Consumer Confidence is now 5.5pts higher than in March 2017 (150.8) and 21.4pts above the long-run average (2005-2018) of 134.9. The increase in Consumer Confidence was driven by more confidence about Indonesian personal financial situations compared to a year ago. Now 40% (up 3ppts) of Indonesians say their families are "better off" financially than this time a year ago, while just 10% (up 1ppt) say their families are "worse off" financially. Meanwhile, 88% (unchanged) of Indonesians expect Indonesia to have "good times" financially during the next 12 months, and only 12% (also unchanged) expect the nation to have "bad times" financially over the next 12 months.  To continue reading this article click here.