Indonesia steps back from new negative investment list
Following protests by business representatives, the government has stepped back from its policy of removing 54 business sectors from the current negative investment list (DNI).
Coordinating Economic Minister Darmin Nasution said the new policy, which was part of the 16th economic stimulus package was still in the discussion stage.
“We will assess together, not [the government] alone. After this discussion stage, we will sit together and the results will be conveyed to the President,” said Darmin as reported by kontan.co.id.
He said he would attend the national leadership meeting of the Indonesia Chamber of Commerce and Industry today to discuss the new DNI with members of the lobby group.
Darmin’s statement followed criticism by Kadin and the Indonesian Employers Association of the policy.
Kadin had called on the government to delay the implementation of the policy, which was initially to be announced next Monday. – The Jakarta Post
Singapore factory output in October beats forecasts
Singapore’s manufacturing output grew 4.3 per cent year on year in October, more than rebounding from September’s 0.1 per cent dip and exceeding economists’ expectations of 2.6 per cent growth.
Excluding the volatile biomedical manufacturing sector, output grew 3 per cent, preliminary estimates from the Economic Development Board yesterday showed.
On a seasonally adjusted month-on-month basis, October’s manufacturing output also ended a three-month streak of decline, instead growing 2 per cent, or 3.9 per cent without biomedical manufacturing.
On the downside, electronics output fell for the second straight month, down 2.7 per cent year on year, with semiconductors, computer peripherals and data storage seeing contraction. Other electronic modules and components grew 5.1 per cent, and infocomms and consumer electronics segments grew 1.7 per cent.
Despite this, the electronics cluster's output has still seen a cumulative increase of 8.9 per cent from January to October, compared to the same period the year before. – The Straits Times
Laos shuts almost 1,000 wood-processing plants
Nearly 1,000 wood-processing plants across Laos have been shut down since Prime Minister’s Order No 15 was issued in May 2016.
Prior to the order, there were 2,102 wood processing plants but the number has now fallen to 1,150, Prime Minister Thongloun Sisoulith informed the National Assembly last week.
“The government will step up inspections and work to improve more plants to ensure they meet quality standards,” he said.
Following the move, the government’s taskforce and other authorities have seized illegally harvested timber which has been sold by tender, fetching US$1.94 million (Bt64 million), Thongloun revealed.
The government has resolved to sell the remaining seized illegal wood by tender and to speed up payments by winning bidders who have not yet handed over the money they owe.
The drastic measures under the order were intended to reform regulation of the timber industry and ensure that only finished wood products are exported. Since the Order was issued, Laos is starting to see the fruitful results of stronger forest governance and address the chronic problem of illegal logging, according to the Ministry of Agriculture and Forestry.
No more govt-guaranteed loans for state enterprises
The Lao government will no longer act as a guarantor for state enterprises that plan to borrow funds for their investment and expansion, according to a senior government leader.
Deputy Prime Minister and Minister of Finance Somdy Duangdy, told the National Assembly earlier this week that the government would not allow state enterprises to use its status to back their loan plans. However, he said the government would be happy to support state enterprises in borrowing money to invest in projects that had the capacity to yield a profit. State-owned companies must provide evidence that they will be able to generate income and repay bank loans otherwise they will not get government support. Analysis shows the key message from the government is that it will support state enterprises that want to borrow money to invest but will not help them to repay loans.
In the past, the government borrowed money from international financial institutions and friendly countries to invest in state-owned enterprises. But in recent years the government has found that many of these enterprises were performing poorly.
As the loan guarantor, the government must be responsible for paying back the loan, not the company, in cases where state firms are unable to generate income and repay the loan and the interest accrued.
According to the deputy premier, the government must stop borrowing money for state enterprises because it has to rein in public debt otherwise the country will face financial instability.
At present, public debt is about 60 per cent of GDP. Many economists view this amount of debt as being very high and say Laos would be at risk if the country faced an external shock.
According to a report from the government, there are nearly 200 state-owned enterprises, many of which are underperforming.
Garuda eyes foreign travellers in online travel fair
National flag carrier Garuda Indonesia aims to expand its reach during the Garuda Online Travel Fair (GOTF) by also eyeing foreign travellers to Indonesia, Garuda Indonesia commercial director Pikri Ilham Kurniansyah said in Jakarta.
Garuda Indonesia is offering 1.6 million seats with discounts of up to 75 per cent to both domestic and international destinations during the fair, which ends on Thursday. It is the third online travel fair held by the airline this year. As an example, a Jakarta-Denpasar return ticket was sold for 1.14 million rupiah (Bt2,600), while a Jakarta-Tokyo return ticket was offered at 4.41 million rupiah.
“We are also targeting buyers from other countries to come to Indonesia too. The GOTF can be accessed by people from all around the world,” Pikri said, mentioning countries like Singapore, Malaysia, Thailand, India, Australia, Japan and South Korea, among others. During the three-day fair, Garuda Indonesia is targeting sales of 200 billion rupiah, 30 per cent of which is expected from buyers from other countries.