[Kabar-indonesia] 19 RI Biz/Econ Reports: SBY Scolds Regional Govts; US$646m Riau FDI/MOUs

[JoyoNews at aol.com]

19 RI Biz/Econ Reports:

- Indonesia's president urges regional
  govt to keep to spending budgets
- Indonesia's Riau Island Province 
  signs MOUs for up to US$646.2 mln 
  of FDIs
- SKorea Daeju Construction Plans 
  US$500M Indonesia Shipyard
- Malaysia Khazanah Eyes Indonesia 
  Road,  Power Invest Ops
- Bank Indonesia awards 48.41 trln rupiah
  of 1-mth SBIs at fixed rate 11.75 pct
- Indonesian govt revokes licences of
  125 logging cos
- Indonesia's Jasa Marga to go public in
  Nov - paper [previously sent]
- Indonesia's Jasa Marga sets US$333 mln
  earnings target for IPO
- Indonesia's Telkom postpoines tender for
  BTS projects
- Indonesia's Bank Mandiri, Malaysia Airlines
  forge cooperation
- Indonesia's MNC sets indicative bond
  yield -source
- Stock watch - Indonesia's Gudang Garam 
  sharply higher on technical rebound
- Indonesia's Ramayana sees 2006 net 
  profit up at least 10 pct yr-on-yr
- Indonesia's Bank Sumut post increase 
  in first half profit
- Temasek to comply with Indonesia's 
  single presence rule: Danamon
- Malaysia Maxis: Target Indonesia 
  Ops Break Even By 2012
- Indonesia's Astra Agro palm oil tender
  goes unsold
- Indonesia palm oil firm, thin demand
  slows trade
- Malaysia's Asiatic buys 40,200 
  has of land for Indonesia oil palm 
  venture-report

ndonesia's president urges regional govt to keep to spending budgets

JAKARTA, August 23 (XFN-ASIA) - President Susilo Bambang Yudhoyono 
has called on regional governments to stick to their buget schedules for
spending monies received from the central government.

'Please manage the funds in accordance with plans and regulations,' 
he said in a speech presented to the Regional Representative Council
(DPD). 'I have monitored some delays in spending of regional
government budgets with some regions placing the money in banks 
and into Bank Indonesia Certificates (SBIs),' he said.

'These are things that should not have happened,' he added.

The virtually risk-free SBI has become a favorite investment
instrument of regional governments in the wake of sharp rate hikes
last year with the 1-month certificate currently offering a fixed
coupon rate of 11.75 pct.

Regional governments' total SBI investments are currently estimated at
around 43 trln rupiah. President Yudhoyono however, did not indicate
if he would order local governments to stop investing their budget
funds into SBIs. The national government has been pushing state
authorities to speed up spending in order to boost economic growth.

Separately, DPD chairman Ginanadjar Kartasasmita, said investment of
funds in SBIs of money earmarked for public works has had a negative
effect on the public's perception of regional governments. 'The
practice has hurt people's confidence and shows that regional
governments are unable to manage their budget effectively and
efficiently,' he said.

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Indonesia's Riau Island Province signs MOUs 
for up to 646.2 mln usd worth of FDIs

JAKARTA, August 23 (XFN-ASIA) - The Riau Island provincial government
said in a statement it has signed memoranda of understandings (MOUs)
with 7 foreign investors, for foreign direct investments totaling up
to 646.2 mln usd.

Riau Island province covers Batam, Bintan and Karimun islands.

The seven include Dae Ju Construction & Engineering Co Ltd which will
invest 500 mln usd to build a shipyard and Singapore's Tiong Woon Co
Ltd, which will invest 20 mln usd for shipping services.

The other five are are engineering firm Schmidtmann Pte Ltd as well as
joint venture firms PT Batamfast Indonesia, PT Neptune Marine, PT
Cemara Intan Shipyard and PT Indo Multi Sarana.

PT Indo Multi Sarana will invest 15 mln with an option to increase it
to 100 mln.

PT Cemara Intan Shipyard will invest an initial 2 mln usd to produce
and repair ships, while PT Neptune Marine will invest 1.6 mln in ship
repair services.

PT Batamfast Indonesia plans to invest up to 20 mln for ferry
transportation, while Schmidtmann will invest 2.6 mln in engineering
services, the statement said.

Oh Jae Hong, the overseas business director of Dae Ju Construction &
Engineering said after today's MOU signings that his company will
invest its funds over the next 5 years.

'If everything goes as scheduled we will start our operations as early
as September this year,' he said.

------------------------------------

SKorea Daeju Construction Plans US$500M Indonesia Shipyard

JAKARTA, August 23 (Dow Jones)--South Korea's Daeju Construction
Engineering will invest US$500 million in a shipyard project in
Indonesia's Karimun Island, the company said Wednesday.

"The construction of the shipyard is expected to start in September of
October," Oh Jae Hong, Daeju's overseas business director, told
reporters in Jakarta. He didn't say when the shipyard will be
finished.

Daeju could develop the shipyard to be the biggest one in the world in
the future, he said.

Daeju is one of seven local and foreign companies that signed
investment agreements Wednesday with the government of Riau Island
Province.

The seven companies plan to invest a total $543.2 million in the
province's islands of Batam, Bintan, and Karimun.

----------------------------------

Malaysia Khazanah Eyes Indonesia Road, Power Invest Ops

JAKARTA, August 23 (Dow Jones)--Khazanah Nasional Bhd., Malaysia's
government-backed investment agency, is considering investments in
Indonesian infrastructure projects including toll roads and electrical
power plants, a senior company executive said Wednesday.

"Both these areas... are areas we're interested in (and are) in
discussion with Indonesian authorities (about)," Khazanah managing
director, Azman Mokhtar, told reporters on the sidelines of a
conference in Jakarta, without specifying a timetable nor a value for
potential infrastructure investment in Indonesia.

Azman said Khazanah's toll road unit had already initiated discussions
with Indonesia's state-owned toll road operator PT Jasa Marga about
potential investment opportunities, Mokhtar said without elaborating.

Khazanah's interest in infrastructure projects is good news for
Indonesia's government, which is desperately trying to jump-start such
investment to help power ambitious economic growth targets.

The Indonesian government of President Susilo Bambang Yudhoyono said
in January 2005 that it needs $500 million in infrastructure
investment over the next five years to reach an average economic
growth target of 6.6% from 2005 to 2009.

The government has an official growth forecast of 6.2% for 2006,
outpacing the 5.6% expansion last year.

Mokhtar said Khazanah hasn't yet decided how to respond to Bank
Indonesia's decision in July to adjust the ownership structure of the
country's banks to comply with the Single Presence Policy which bars
individuals and business groups from owning a dominant stake in more
than one domestic commercial bank.

Companies, individuals or legal entities who currently have majority
ownership stakes in more than one bank have until end-2008 to reduce
their stakes, merge the banks into a single entity or form a separate
holding company which has control of the banks.

The policy will affect Khazanah, which owns 62.0% of Bank Niaga
(BNGA.JK) through its controlling interest in Commerce Asset-Holding
Bhd. and 52.0% of Bank Lippo (LPBN.JK).

"We are studying the policy and we are having dialogue with the
authorities....(but) basically our framework would be we would comply
with the rules and regulations of where we operate," Mokhtar said,
without elaborating.

---------------------------------

Bank Indonesia awards 48.41 trln rupiah of 1-mth SBIs at fixed rate 11.75 pct

JAKARTA, August 23 (XFN-ASIA) - Bank Indonesia said it has awarded
48.41 trln rupiah worth of one month Bank Indonesia Certificates
(SBIs) at a fixed rate of 11.75 pct.

The 1-mth SBI rate is pegged to the benchmark interest rate, called the BI 
rate.

------------------------------------------------------------

Indonesian govt revokes licences of 125 logging cos

JAKARTA, August 23 (Asia Pulse/Antara) - The forestry ministry has
revoked the licenses of 125 forest concessionaires since 1999 for
various offenses.

Among the main offenses are failure to pay reforestation fund to the
government and illegally selling business license without approval of
the authorities, Production Forest Utilization Director Listia
Kusumawardhani said.

The revocation of the licenses of the 125 logging companies have
resulted in 11,250 workers losing their jobs, Listia said.

Earlier this year the ministry cancelled the licenses of three logging
companies PT Veneer Produces Indonesia, PT Sari Bumi Bakau and PT Rona
Usaha Perkasa.

---------------------------------------------------------------

Indonesia's Jasa Marga to go public in Nov - paper

JAKARTA, August 23 (Reuters) - Indonesia's largest toll road operator,
PT Jasa Marga, plans to list its shares on the Jakarta exchange in
November to raise around 2 trillion rupiah ($220.5 million) to build
more toll roads, a business newspaper reported on Wednesday.

Investor Daily quoted Jasa Marga's president director, Frans Sunito,
as saying the state-run firm also planned to issue new shares to raise
1 trillion rupiah next year.

"We are aiming to have the initial public offering (IPO) by November.
We are preparing the process and it would have to go to the
(parliament's) privatisation committee first," Sunito said.

The firm, which controls more than 75 percent of the country's toll
roads, plans to float about 30 percent of its stake in the initial
offering.

Jasa Marga plans to build three toll roads as part of the government's
efforts to revive the country's creaking infrastructure.

The company has already announced plans to sell around a 17 percent
stake in PT Citra Marga Nusaphala Persada Tbk (CMNP) , a publicly
listed toll road operator, to raise 400 billion rupiah.

--------------------------------------------------------

Indonesia's Jasa Marga sets US$333 mln earnings target for IPO

JAKARTA, August 23 (Asia Pulse/Antara) - State-owned road construction
company PT Jasa Marga hopes to earn Rp3 trillion (US$333.3 million)
with its plans to launch an initial public offering (IPO) and rights
issue.

The company plans to launch the IPO in November and rights issue next
year, its President Frans Satyaki Sunito said.

Sunito said the IPO is expected to turn out Rp1.5 trillion - Rp2
trillion in November, but the plan is yet to be sanctioned by the
Privatization Committee and the House of Representatives.

Earlier, State Minister for State Enterprises Sugiharto said Jasa
Marga is ready for an IPO.

---------------------------------------------------------

Indonesia's Telkom postpoines tender for BTS projects

JAKARTA, August 23 (Asia Pulse/Antara) - State-owned telecommunication
company PT Telkom has decided to postpone the tender for the
construction of 1,000 new units of base transceiver stations (BTS) in
Jakarta, West Java and Banten.

Head of the Fixed Wiredless Network of PT Telkom Dian Rachmawan said
originally tender was to be held last week but the plan was cancelled.

Dian did not give reasons for the cancellation but the decision
followed the withdrawal of vendors South Korea's Samsung and China's
Huawei.

The new units of BTS are needed with the planned migration by the end
of this year of the frequency of its fixed wireless Flexi in the three
provinces from 1,900 MHz band to 800 MHz.

Currently Telkom has 564 BTS in Jakarta, Banten and West Java.

----------------------------------------------------------

Indonesia's Bank Mandiri, Malaysia Airlines forge cooperation

JAKARTA, August 23 (Asia Pulse/Antara) - State-owned Bank Mandiri
(JSX:BMRI) and Malaysia Airlines (MAS) (KLSE:3786) have signed a
memorandum of understanding on a travel program using the latter's air
service.

In a statement on Tuesday, Bank Mandiri said Omar S. Anwar, managing
director of Bank Mandiri, and Idris Jala, managing director of
Malaysia Airlines signed the MoU.

The MOU is a follow up on the two parties' cooperation since 2005
through the program that for buying one first-class ticket one will
receive one free ticket, and for buying two economic class tickets one
would get one free economic class ticket.

Omar said however the program was specifically intended for Mandiri
visa card holders.

Bank Mandiri and Malaysia Airlines also presented a program of
enriched gold membership to Mandiri's visa platinum card holders.

The card holders will get 50 per cent extra baggage, access to golden
lounge all over the world and check-in priority.

Omar said the cooperation is one of Bank Mandiri's efforts to go 
international.

-----------------------------------------------------------

Indonesia's MNC sets indicative bond yield -source

HONG KONG, August 23 (Reuters) - Indonesia's PT Media Nusantara Citra
(MNC) has set an indicative yield of about 11.25 percent for its
five-year, dollar-denominated bond worth up to $182 million, a market
source said on Wednesday.

The issue is rated B-plus by Standard & Poor's.

Media Nusantara Citra is a unit of PT Bimantara Citra Tbk .

S&P said last month when it assigned the rating that Media Nusantara
Citra was the only integrated media company in Indonesia, with its
three television stations capturing 38 percent of audience share and
32 percent of advertising expenditure as of May 2006.

Deutsche Bank and AAA Securities are handling the proposed transaction.

-------------------------------------------------------------

Stock watch - Indonesia's Gudang Garam sharply higher on technical rebound

JAKARTA, August 23 (XFN-ASIA) - Shares of Indonesia's largest
cigarette maker PT Gudang Garam were sharply higher midmorning on a
technical rebound, as the stock has lagged behind the broad market's
gains in recent weeks, dealers said.

At 11.13 am, Gudang Garam was up 400 or 4.42 pct at 9,450.

The composite index was down 4.432 points at 1,430.597, on 979.21 mln
shares valued at 758.79 bln rupiah.

"The stock was up purely due to a technical rebound," said Teuku
Hendry Andrean, an analyst with Mega Capital.

He said the stock has been relatively flat in the past few weeks while
the broader market had rebounded.

Prayoga Ahmadi Triyono, an Analyst with PT Henan Putihrai, also said
Gudang Garam's rise was a technical rebound after sharp falls early
early this month after the company reported weak H1 results.

"I don't see any justification for the company's stock rise other than
for technical reasons," Triyono said.

Earlier, the company reported that its net profit for the first half
to June dropped 49 pct year-on-year to 545.0 bln rupiah from 1.07 trln
a year earlier, pressured by cost increases and higher interest
expenses.

Sales increased slightly to 12.67 trln rupiah from 12.32 trln the
previous year, while cost of goods sold rose 7 pct to 10.27 trln from
9.61 trln.

Operating expenses also rose 23 pct to 1.25 trln rupiah from 1.02 trln
a year ago.

--------------------------------------------------------------

Indonesia's Ramayana sees 2006 net profit up at least 10 pct yr-on-yr

JAKARTA, August 23 (XFN-ASIA) - Retailer PT Ramayana Lestari Sentosa
expects full year 2006 net profit to rise by at least 10 pct from the
302.35 bln rupiah it posted last year, finance director Setiasa Kusuma
said.

He said the gain will reflect stronger sales, with the firm estimating
sales revenue this year of 4.85 trln rupiah, rising to 5.53 trln in
2007. Last year it recorded sales of 4.30 trln.

In the first six months of this year, the firm posted net profit of
66.73 bln rupiah on sales of 1.75 trln rupiah.

Kusuma told reporters that sales should pick up in the second half,
reflecting the impact of the start of the new school year in mid-July
as well as the Islamic Idul Fitri festival, that falls in October this
year.

Retail companies in Indonesia normally generate around 30 pct of their
full-year sales during the Idul Fitri festival.

Ramayana's target market is mostly middle-to-low income consumers.

Meanwhile, another company official, Koh Bon Kim, said in order to
boost its sales the firm plans to spend up to 250 bln rupiah to open
11 new stores.

---------------------------------------------------------------

Indonesia's Bank Sumut post increase in first half profit

JAKARTA, August 23 (Asia Pulse/Antara) - Bank Sumut, which is owned by
the North Sumatra regional administration, reported Rp81.8 billion
(US$9 million) in pre tax profit in the first half of this year or an
increase of 13.13 per cent from the same period last year.

Bank President Gus Irawan Pasaribu said the bank performed well in the
first six months of this year.

Profit surged in the second quarter after a decline in the previous
three months, Pasaribu said yesterday.

He said credit interest was the main contributor to the profit with
fee based income relatively small.

By June the bank had Rp2.47 trillion in outstanding credits up from
Rp1.6 trillion a year before.

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Temasek to comply with Indonesia's single presence rule: Danamon

JAKARTA, August 23 (Asia Pulse/Antara) - Singapore's Temasek Holdings
Pte Ltd will comply with the central bank's single presence rule, said
Ng Kee Choe, the chief commissioner of Bank Danamon (JSX:BDMN), which
is partly owned by Temasek.

Temasek and Deutsche Bank are partners in the Asia Finance consortium,
which owns 69.9 per cent of the Indonesian bank.

"I am not speaking for Temasek but certainly Temasek will comply with
the rule," Choe said.

Under the rule a bank is allowed to have controlling stake in only one
bank and those already having more than one bank under their control
are either to reduce their stake or have their banks merged into one.

Temasek, in partnership with Kookmin Bank of South Korea, is also a
member of the consortium of Sorak Financial Holdings Pte, which
controls 56.71 per cent of Bank International Indonesia (JSX:BNII).

It also has stakes in Bank DBS Indonesia and Standard Charter Plc,
which owns 31.55 per cent of Bank Permata (JSX:BNLI).

Choe described the rule as natural and said it will not hamper
expansion of Temasek's subsidiaries in Indonesia.

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Malaysia Maxis: Target Indonesia Ops Break Even By 2012

KUALA LUMPUR, August 23 (Dow Jones)--Malaysian mobile network operator
Maxis Communications Bhd. (5051.KU) Wednesday said it expects its
fledgling Indonesian unit to break even by 2012.

"On a profit after-tax level, (we should break even in Indonesia) in
four to five years from FY07," Chief Executive Jamaluddin Ibrahim told
reporters at a briefing.

Maxis is targeting rollout of services in Indonesia toward the
year-end, Jamaluddin added.

Earlier, Maxis' PT Natrindo Telepon Seluler unit had planned to
launched its Indonesia network in the middle of this year.

Among the reasons for the delay, he mentioned ongoing regulatory issues.

In the quarter ended June 30, Natrindo suffered a pretax loss of MYR61
million, higher than the MYR42 million pretax loss in the first
quarter.

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Indonesia's Astra Agro palm oil tender goes unsold

JAKARTA, August 23 (Reuters) - Indonesia's biggest listed plantation
firm, PT Astra Agro Lestari Tbk , failed to sell 3,500 tonnes of palm
oil in a tender on Wednesday due to low bids.

Astra Agro offered 500 tonnes of high grade super CPO at 4,260 rupiah
($0.469) per kg ex-factory Riau and 1,000 tonnes at 4,165 per kg
ex-factory Jambi on Sumatra island, the company said in a statement.

The firm also offered 2,000 tonnes of super CPO at 4,355 per kg
free-on-board Kumai port in Central Kalimantan province on the
Indonesian side of Borneo island.

Astra Agro is a subsidiary of the country's largest automotive
distributor, PT Astra International Tbk .

In a separate tender, the state marketing centre sold 2,000 tonnes of
CPO at 4,338 rupiah a kg.

-----------------------------------------------------------

Indonesia palm oil firm, thin demand slows trade

JAKARTA, August 23 (Reuters) - Indonesian palm oil prices firmed on
Wednesday, supported by gains in Malaysian crude palm oil, but trading
remained slow as buyers had ample stocks, traders said.

Crude palm oil in North Sumatra's Medan traded at 4,350 rupiah
($0.479) a kg, up from 4,322, 4,328 and 4,333 rupiah in three
different auctions on Tuesday.

At the state marketing centre's auction in Jakarta, crude palm oil
traded at 4,338 rupiah, up from 4,320 on Tuesday.

"It's a quiet day today. Buyers still have stocks, while sellers are
watching the prices," said a trader in Medan, the provincial capital
of North Sumatra and a key port for palm oil exports.

In Jakarta cooking oil prices were unchanged from Tuesday at 5,025 rupiah.

"Some sellers are lowering prices to lure buyers because demand is
thin today," said a trader in Jakarta, adding 200 tonnes of olein
changed hands.

Malaysian crude palm oil futures bounced back by midday on Wednesday,
helped by technical covering and firmer prices of rival soyoil.

In the export market, sellers offered September shipment at $442.5 a
tonne, free on board Belawan, and buyers bid at $440.

Deals were reported at $441.50 but details on quantity and
destinations were unavailable.

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Malaysia's Asiatic buys 40,200 has of land for Indonesia oil palm 
venture-report

JAKARTA, August 23 (XFN-ASIA) - Malaysia's Asiatic Development Bhd, in
cooperation with its Indonesian partner Sepanjang Group, has acquired
40,200 hectares of land in West Kalimantan province to develop into an
oil palm plantation, Bisnis Indonesia reported, citing Asiatic
director Dato Baharuddin Musa.

Asiatic is the plantation arm of Malaysia's Genting Bhd.

Musa said his company will expand the oil palm plantation area to
around 100,000 hectares, with a planned total investment of
approximately 1.4 bln rgt or 3.5 trln rupiah.

Musa said Asiatic will also invest in derivative products such as
biodiesel in the future.

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Joyo Indonesia News Service
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