The target and direction of industrial and trade
development for the last year of the Sixth Five-Year Development and for
the Seventh Five-Year Development are basically still relevant to be implemented,
even though the challenges are different due to recent position of national
economic growth and "unpredictable condition" and "unbelievable changes"
of international economy and market. In addition, Indonesia is still facing
other problems, such as:
to realize commitment with IMF to implement
to carry out WTO obligation or Import
Tariff Reduction schedule, TRIP'S, etc.
Early liberalization agreed in APEC forum:
Acceleration of AFTA from year 2003 to
To Confront new issues which will become
international regulations, such as electronic commerce, anti-bribery convention, etc.
During the period of the Development Reform Cabinet,
considerable targets have been achieved in Industry and Trade sector. For
instance. the government, by issuing Presidential Decision No. 7 of 1999
of 14'h January, 1999, has given incentives to new companies investing
their capital in particular sectors (grouped as pioneers) in form of Income
Tax borne by the Government.
In order to increase export, the government has
expanded the scope of commodities that are given Particular Export Companies
Policies in foreign trade field is directed to
increase export value and foreign exchange receipt diversity types of commodities,
strong competitiveness, expand market access, promote non-oil and gas commodities,
and settle export problems.
Import policies are directed to control goods
imported, for production and consumption needs, state security, and environment.
The import policies are among others in forms of import restriction, import
trading procedures consisting of permits, import executive appointment.
and quota; import duty tariffs, overcoming unfair trade practices such
as violation of Anti Dumping and countervailing Duty.
In the meantime, to improve Small and Medium-Scale
Industries (IKM) in critical period, the government has allocated rolling
fund assistance amounting to Rpl8.75 billion for 512 IKMs spread in 10
provinces covering handicraft industries and agricultural industries which
have export potentials and their supporting businesses. The rolling fund
assistance is still going to be provided from fiscal year 1999/2000 in
the amount ofRpl6,895 million.
In the framework of facing market globalization
and strengthening competitiveness of small industries' products, the government
will implement ISO-9000 quality management absorption program, including
small industry producing export commodities, component making (sub contracting)
industry, types of industry that will and have applied SNI national standard,
and industrial companies experienced in applying Group Quality Control
(GKM). In 1998/1999 IKM has succeeded in applying ISO-9000, where 65 companies
were able to apply Module A Certificate, and 91 companies applied Module
By the legalizing Act Number 5 of 1999 on Prohibition
of Monopoly Practices and Unfair Competition on 5'h March 1999 that will
take effect one year after being sanctioned, the industrial competitiveness
in the country has become healthy.
The creation of Act on Prohibition of Monopoly
Practices and Unfair Competition is intended to give contribution to the
efforts of improving natural economy efficiency, which in turn will increase
The legalization of Act Number 8 of 1999 on Consumers
Protection by the President of the Republic of Indonesia on 20'h April
1999 that will take effect in April 2000, in this reform era, is expected
to be able to give freedom to consumers in enjoying a product and simultaneously
to build business actors in selling their quality product as well as to
Two consumer protection agencies were born from
this Act, namely the National Consumer Protection Board (BPKN) domiciled
in the Capital City and Consumer Dispute Settlement Board (BPSK) in Second-Level
District Territory. Both agencies' members consist of representatives of
business actors, consumers, academicians and non-government consumer institutes,
beside those of the government. The number of companies registered based
on the Act on Company registration Obligation from July are 1,376,426
companies, consisting of 199,588 limited liability companies (PTs), 26,9'86
Cooperatives, 198,248 CVs and 3,260 Firms, 936,875 individual firms, and
11,478 other types of companies.
The companies who have submitted their Company's
Annual Financial Report (LKPT) up to 4'h June 1999 amounted to 45 companies,
consisting of PT. (PT. Tbks) and State-Owned companies.
The Issuance of a series of policies free import
trading and distribution of sugar arrangement and farmers' obligation to
grow sugar cane and sell their harvest to BULOG (National Logistics Agency).
Thus, sugar trading is handed over to market mechanism,
and General Importers (lUs) can carry out import with 0% import duty. To
assist farmers in overcoming loss due to decrease in sugar prices in domestic
markets, the government has decided that farmers' sugar should be bought
by Sugar Factories at Rp2,500 per kilogram and the Sugar Factories have
to buy farmers' sugar in 90% cash and the balance should be paid in form
of kind (in accordance with Minister of Forestry and Plantation Decision
Number 282/Kpts-IX/ 1999 of 17th May, 1999).
Import trading arrangement of Automotive Industries
which was formerly arranged through IU, TT/AT and subject to a very high
percentage of import duty, has been reviewed and is planned to be altered
to automotive import simplification by eliminating tariff barriers.
Now, an opportunity is increasingly opened to
priority commodities, especially those with domestic natural resource base
and high local contents.
Meanwhile, to assist the business world in trade
financing in order to be more competitive in international economy, the
Ministry of Industry and Trade has initiated the establishment of an Export
Financing Institution (LPE). In the progress, by Government Regulation
Number 37 of 1999, the government has established the Indonesia Export
Bank (BEI), which is intended to assist export-import activities by providing
finance and guarantee, and consultative services connected with financing
and guaranteeing, and other businesses that support both of them.
Exhibition and Promotion
The performance of the Indonesian Resources Exhibition
1998 (PPE'98) in the middle of the economic crisis that overwhelmed Indonesia,
in fact, was able to push active participation of around 800 Indonesia
businessmen/exporters from 27 provinces. The exhibition was visited by
2,799 foreign buyers coming from 99 countries, and produced business transactions
for export amounting to US $71.2 million originated from 78 countries.
Indonesian business participation in Trade Exhibitions in 1998/1999 (32
exhibitions in II countries), was really able to open new opportunities
and give positive contribution to increase and expand Indonesia export
market share. This was reflected in the results of business contacts in
forms of business contract/transaction, inquiry, marketing cooperation,
and other business cooperation. The exhibition activities are utilized
among others by businessmen of groups of leather products, textiles, garments,
toys products, electronics, house wares and other handicrafts.
The execution of Trade and Investment Missions
to five exportdestination countries, i.e. the United States of America,
the United Kingdom, the Netherlands, Japan and Taiwan was directed toward
recovering Indonesian image in international world. Trade contacts with the USA achieved
transactions amounting to US$13.3 million, Japan and Taiwan US$21.2 million,
and with UK and the Netherlands amounted to US$16. I million in value.
In order to empower and to create simultaneously expanding the marketing
network of UKM's products, the government has pushed for the establishment
of "Indonesian Emporium Batam Sands" located at an area of l,800m2. The
establishment of the Indonesian Emporium is intended as a "Marketing Point"
in order to bring sales and promotion of export quality products closer
to consumers/buyers, especially those of overseas. The establishment of
Indonesian Emporium will be more expanded to other locations such as Entikong,
West Kalimantan, and Bitung - Manado, and abroad such as Los Angeles -
the USA, Johannesburg - South Africa, Amman - Jordan, and in European trade
The Research and Development body of sectoral and regional industries
during 1998/1999 conducted color essence identification originating from
nature in several provinces. In 1999/2000 it is planned to begin toxicity
research phase to find out any kind of color essence material that can
be used for food and non-food, so that from the outcome of the research
it is expected to obtain color essence as import substitutes. Then the
office will perform the next phase research. which will be viewed from
its techno-economics intended to able to apply to IKM.
The socialization of research products are in forms of prototype of
cassava chopping and dried cassava processing machines for IKMs in Lampung.
and application of processing machines of pulp made of dried rice stalks
materials in some PUSKUs in Indonesia, and the making of tire (motorcycle)
vulcanization for IKMs applied in Medan.
The development of mining and energy in the Reform Development Cabinet
is aimed at making anticipative steps to create people's aspiration who
need reform and improvement in economic, political, law, social and public
To resolve the monetary crisis, it needs steps to defend and improve
the role in mining and energy sector to support national economy. It should
open a wide chance for the private sector to make tender to eliminate the
practice of KKN (corruption, collusion and nepotism).
The target of mining and energy reform is to improve the achievement
through the clean, effective, efficient and professional apparatus to create
the clean government. The targets also include making amendments to the
regulations as the basis of business development in mining and energy sector
to support national economy, and increase people's role in improving the
economy by giving a wide chance for small or middle business and cooperatives.
The government's reform agenda in the mining and energy sector were
divided into three main parts: regulations, institutions and practices.
At that moment there were 103 problems; 59 problems of regulations, 20
problems of institutions and 24 problems of practices.
The main issues in mining and energy sector are environment, poverty
and social imbalance, employment field, the policy of processing natural
resources, law, the improvement of human resources, conversion to the private
sector to improve efficiency and expansion of national companies, etc.
Those main issues will influence the policy in mining and energy development
in the future.
Besides the main issues mentioned, the policy in mining and energy sector
should notice the general planning of layout, marine development, deregulation
and debureaucratization, autonomy, the Asia Pacific Economic Cooperation
(APEC), the growth cooperation areas of ASEAN, and the development of mining
area. Business in mining and energy sector should also notice the aspects
of the availability of goods, requirement and supply, business pattern,
human resources and technology and the policy.
The mining and energy policies in the reform period are as the following:
completing the regulation of oil and gas, coal and mineral and energy
and electricity as an insurance in business certainty;
eliminating monopoly system;
placing economic actors at the same level;
implementing the market mechanism;
completing institutional system at mining and energy ministry to
create simple, modern and efficient bureaucracy.
eliminating KKN practices; and
noticing society and environment perception.
In the framework of developing humap resources, the government has the
training and education in institution those are: the Oil and Gas Training
Development Center in Cepu, Mineral Training Development Centre in Bandung,
a Research Institution "Lemigas" in Jakarta, Mineral Technology Development
Centre in Bandung, Marine Geology Development Centre in Bandung and Geological
Research Development Centre in Bandung.
The government's important step in mining and energy sector since 1998
is to restructure oil and gas sector and electricity.
Restructuring in oil and gas sector is done through government and company
restructure. The government has task to make policy to protect society
and company's orientation in loss and profit. The government can make the
policy in regulation, tax, environment protection, etc. Company operational
aspect is how to operate and develop its business in getting profit.
In the framework of restructuring oil and gas sector, the government
has made the bill concerning oil and gas. The substance of this bill is
to eliminate monopoly business, to offer business to improve people's welfare,
to develop national company capability and to guarantee a law in running
oil and gas sector. Since March 1999, the House of Representatives and
the government have discussed this oil and gas Bill continuously.
The oil and gas development need a lot of fund, hence the fulfillment
of investment and control shall be transferred step by step to the society,
whereas the government has a role in establishing the policy.
Restructuring in the electricity sector is done step by step, consisting
of the arrangement of electric industry in Indonesia, and the government
role in the power sector. The basic policy in restructuring the electric
sector is to create an electric sector that can stand alone based on high
efficiency principle through a healthy competition, transparency in business
and the same level and fair treatment of all the business actors.
Electric restructuring specifically notices the electric condition and
people's capability in each region, and the electric tariff cost will be
made reasonable to reflect the economic aspect in providing electricity.
Electric subsidy is aimed for low income society. It is hoped that all
process in the electric sector will be finished in the next four years.
The development of electric power supply in 1998/99 has achieved to
20,580 MWs with capacity of 77,422 Wh. This electricity power can fulfill
community's need. The operation of development of gas transmission network
in South Sumatera has saved the using of oil amount to 50 thousand barrels
In the framework of eliminating KKN in national economy and creating
a healthy climate for investment, based on MPR Decree No.XI/1998, measures
have been taken to control on 159 projects that are indicated having KKN
with Pertamina: reviewing Presidential Decisions that are indicated as
KKN including the projects of stateowned companies that use state budget.
Among the 159 projects, the state can prevent a loss amounting to Rp212
billion and US$92.9 million.
Reform in the mining and energy sector consists of restructuring institutions,
the regulations and unhealthy practices: the development of mining and
energy sector to compete in other countries; the increase of added value
through the industrial development in mining manufacture and mastering
The results of the reform in mining and energy sector are as the following:
The Bill concerning oil and gas are being discussed in the House
of Representatives since March 4, 1999;
The Bill concerning electric power is being discussed in the
The Bill concerning general mining is ready to be submitted
to the President;
Completing some government regulations, Presidential decisions
and the lower regulations;
Eliminating unhealthy practices; and
Making communication forum concerning mining and energy system
and making face-to-face communication between the minister of mines and energy and society.
COOPERATIVES, SMALL AND MEDIUM-SCALE ENTERPRISES
Facing the economic crisis and anticipating global economic changes
marked with tight competition, several policies and programs focused on
the new paradigm of Indonesia's economy are continuously being developed
The People's Consultative Assembly (MPR) Decision No. XVI/MPR/1998 concerning Economic Politics in the framework
of Economic Democracy has been issued considering that: Economic Democracy
as mandated by article 33 of the 1945 Constitution has not been realized;
the National Development is faced with challenges that need economic-political
attention for further opportunity, support, and development to people's
economy, covering cooperatives, the small and medium-scale enterprises.
Basically, the MPR decision is meant to create national economic structure,
which is conducive for the existence of strong and largernumber of medium-scale
enterprises as well as mutual beneficial partnership among entrepreneurs.
As a follow-up of MPR Decision No. XVI/1998, the President of the Republic
of Indonesia has launched the date of October 17, 1998 as the People's
Economy Awakening Day. On the occasion it was stated that economic reform
has taken place from the old economic policy into a new people's economy,
with the foundation of a system that continuously evenly distribute ownership
of economic resources, including productive assets of which, previously
the ownership was mainly concentrated on the state and big conglomerates.
In an effort to increase the people's participation, especially in meeting
their basic needs, and to support the growth of the people's economic activities.
Presidential Instruction No. 18/1998 was issued, to amend Presidential
Instruction No. 4/1984. By Presidential Instruction No. 18/1998 it is made
easier to establish cooperatives when deemed feasible and in accordance
to needs and economic interest.
Act No. 5/1999 concerning the Ban of Monopoly Practice and Unhealthy
Business Competition has been issued in the effort to create conducive
climate, increase efficiency of the national economy, and create business
effectivity and efficiency for the development of the small and medium-scale
enterprises and cooperatives. It is also to improve efficiency of national
economy; guarantee the certainty of equal business opportunity for the
big, medium and small-scale enterprises and to prevent monopoly practice
by businessmen which could inflict loss upon the others.
Policies have been made for implementation of breakthrough programs
in effort to empower the people's economy, such as:
a. Rehabilitation of food production and distribution, in which
cooperatives and the small and medium-scale enterprises are given opportunity in food
production and distribution.
b. Increase credit access for members, cooperatives and the small
and medium enterprises in the effort to meet the need of capital for business development.
c. Institutional structuring which is directed at developing
cooperatives institutions reflecting the needs and identity in accordance with members' economic activities
including members as producers, consumers, and debtors. Also, in developing cooperatives synergy, cooperative
networks are developed horizontally and vertically.
d. In asset redistribution's, cooperatives and the small and
medium enterprises are given the opportunity to own and  manage productive assets. In order to support
the policy, a capital institution for cooperatives and the small and medium enterprises namely Permodalan Nasional
Madani Limited Company (PT.PNM) is being developed.
In the framework of implementing the above-policies, various programs
have been carried out, such as providing 17 credit schemes, namely KUT
(credit for farming undertakings), KKOP, KKPA (credit for primary cooperatives
members) consisting of 7 kinds of credit, KPRS, KMKBPR/PMKBPRS, KPKM/PPKM,
KPTTG-Taskin, KMK-PKM, KPT-PUD, Taskin Koppas credit and KUA (Credit for
In an effort to improve services to cooperatives members and realizing
the limited ability of cooperatives and small and medium-scale enterprises
human resources, PER (the People's Economy Post) has been developed through
strengthening the function of the existing KKB (Business Consultation Clinic)
and establishment of new PER. The establishment of PER is aimed to give
information services and/or advocation to cooperatives, the small and medium-scale
enterprises in developing their economic activities.
Until May 6, 1999, 2,215 units of PER have been established, consisting
of one unit of National PER, 27 units of Provincial PER, 264 units of District
PER and 1,923 units of sub-district PER.
In the framework of PER development, training of TOT (Training of Trainers)
were carried out for lecturers and NGOs. Also for consolidation of PER
development, a workshop on the adaptation of information technology in
rural development was carried out on March 31, 1999.
The role and needs of cooperatives institutions for credit guarantor
as one of cooperatives financial sub-system have become very strategic.
In an effort to increase service of credit guarantor institutions to cooperatives,
beside PKK company and FT. Askrindo, institutions of credit guarantor in
the form of KPKKUK (Credit Guarantor Cooperatives for Cooperatives and
Small-scale businesses) are being developed. It is expected that the activities
of this credit guarantor cooperatives, besides providing service of guarantee for its members
of primary cooperatives, would also provide business consultation services.
By developing credit guarantor cooperatives, it is also hoped that the
absorption process of 17 available credit schemes could accelerate.
From the institutional aspect, until December, 1998, the number of cooperatives
was 59,441 units which consist of 58,800 units of primary cooperatives,
and 641 units of secondary cooperatives. Of the total number 46,420 units
or 78% are active cooperatives and the remaining 13,021 or 22% are in-active
cooperatives. The growth of cooperatives and members of cooperatives within
four months (December 31, 1998 to April 30, 1999) showed a small increase
number. The total number of cooperatives as of April 30, 1999 was 62,285
units consisting of 59,441 units of active cooperatives and 10,634 units
of in-active cooperatives. Cooperatives members amount to 20,411,807.
The equity amounted to Rp5,121,962.85 and debt Rp4,330,986.05. While sales volume reached Rpl2,952,140.48
and SHU (profit) gained amounted to Rp508,925.09 million.
The above-figures show that the average equity of each cooperatives
is Rp 110.33 million, the average sales volume is Rp279.02 million
per cooperatives and the average SHU per cooperatives is Rpl0.96 million.
From the total sales volume of cooperatives the largest contribution
came from undertakings activities. Until the end of 1998, from the total
undertakings volume of Rpl2,952.13 billion, the biggest contribution came
from KUT activities with the amount of Rp366.18 billion, followed
by food providing activities Rpl22.9 billion and KSP/USP (the cooperatives credit units) Rp4,056.78 billion. The rest
came from activities of Waserda undertakings, fertilizer, services and others.
After launching 18 credit schemes for cooperatives and UKMs which came
from KLBI (Liquidity Credit of Bank Indonesia) and nonKLBI with asset amounted
to Rp9,806.73 billion, until the end of March, 1999 realization of credit
has reached Rp941.47 billion or 162.55% of the total credit ceiling.
SAFETY NET (JPS)
In an effort to accelerate national economic recovery as part of economic
crisis impact, various programs have been prepared, including JPS program.
Iplementation of JPS is hoped to be able to directly bring real impact
to the people's economic improvement.
JPS programs related to people's economic empowerment were implemented
in the fiscal year of 1998/1999, among others the in forms of:
a. Roll over working capital assistance to 1000 groups.
b. LEPMM (self-supporting productive economic institutions) in
26 provinces, 100 districts.
c. Training for 100 facilitators, 1000 assistant
officials, and 1000 managers of LEPMM.
d. Pilot Project for Integration of people's economic businesses
which consist of:
1. Pilot project for integration of people's economic undertakings
in the field of small-scale palm oil processing
(1.5-2 ton/hour) in Ogan Komering Ilir District,
South Sumatra Province.
2. Pilot project integration of people's economic undertakings
in the field of livestock fish feed processing (2 ton/hour)
in the regions of Cirebon, West Java; Pekalongan
regency, Central Java; and Pacitan District, East Java Province.
3. Pilot project integration of people's economic undertaking
in the "garut" processing as alternative raw material for food industry at Ngawi District, East Java
Province and Banyumas District, Central Java Province.
TRANSPORTATION AND COMMUNICATIONS
The vision of the government in the field of transportation and communication
is the realization of transport organization in one unitary, advance and
reliable national transportation system, the smooth post and telecommunication
that have a good quality and wide coverage, comprises the artery of economic,
social, cultural, political and defense-security lives in supporting national
developments as vehicle in the efforts to improve people's welfare. While
the mission is to perform reliable transportation, post and telecommunication
services, which are supported by professional human resources and advance
science and technology in order to realize its vision.
The objective of the development in the field of transportation and
communication is to realize transportation system that ensuring the integration
of inter and among transportation modes, the supply of transportation,
post, and telecommunication services that can reach all regions, including
isolated, remote and strategic areas. The availability of those services
is designed to meet regional needs in accordance with their potential,
condition and characteristic.
Strategies taken by the government in efforts to implement its policies
in the field of communications are divided as follows:
(a) to provide facilities
and incentives in transportation sectors that experiencing obstacles due
to economic crisis;
(b) to give priority in accomplishing communication means and infrastructures development;
(c) to simplify and abolish permits;
(d) to optimalize the utilization of existing means;
(e) to keep a conducive business climate:
(f) to refresh the BUMN (The State-Owned Enterprises);
(g) to support the budget and optimalize existing technology;
(h) to modernize telecommunication network and execute limited open sky gradually;
(i) to organize business cooperation and alliance.
In order to enhance the smoothness of distribution, the government
has implemented the program of roads network management.In 1998/1999, there
has been accomplished the program of roads management through:
the rehabilitation and maintenance of 1,067 km of national roads
and 15,535 meter of national bridges and routine maintenance of 15,345 km of roads.
the improvement of 2,180 km of roads and reconstruction of
4,369 m or national bridges, including transmigration roads.
the construction of 1,379 km of roads and 1,744 meters of bridges.
the improvement of 3,125 km of provincial roads and 7,972 km of regencial roads.
the construction of 53,429 km of village roads through P3DT program.
In the meantime, the number of operated busses now is 32.92% of AKAP
(Inter-city, inter-province) and 67.07% of AKDS (Inter-city, within province),
while for urban transportation in DKI (The Special Territory of Jakarta),
the number is 58.26% (41.74% decreased). The economic crisis also makes
PERUMKA (the Railways Public Company) facing the rise of operational
cost. This company also accepts the transfer of passengers from land, sea,
air, river, lake, and ferry transportation.
Besides, there are also a fairly luxurious passengers train "Argo Dwipangga"
to link Solo Balapan-Jakarta that taking only 8 hours journey started operating
on April 21, 1998. There has been also operating "Mahesa" train of Bandung-Semarang
direction since July I, 1,998; Brantas train (economic class) of Tanah
Abang-Kediri direction since October 1, 1998; Argo Wilis Express train
of Bandung-Surabaya direction with ten and a half hours duration of journey
since November 8, 1998: Logawa train (economy plus) of Purwokerto-Surabaya
direction since April 21, 1999.
To re-operate railways service in Aceh, it is required to widen railtrack
from 750 mm to 1,067 mm as found in North Sumatra. Since the fiscal year
of 1991/1992, the government has gradually reconstructed those railways
tracks. In the fiscal year of 1999/2000, the government will establish
a project for rehabilitation of railway services domiciled in Aceh with
the task to compose its detail design. This step has a great meaning for
the Aceh community and it will directly help to overcome the existing physiological
The government also decides Sabang town as an Integrated Economic Growth
Area (KAPET) that covering Sabang Municipality and its surroundings and
West Aceh District. There are also still many development activities of
transportation implemented in Aceh such as the construction of ports in
Kuala Langsa, Lhokseumawe, Sabang, and the expansion of lskandar Muda Airport.
During the latest year, there has been operating some express ferry
ships of Surabaya-Ujung Pandang line since September 17, 1998; Seroja of
Surabaya-Banjarmasin and Surabaya-Balikpapan lines since May 29, 1999;
Mahakarn of Kumai-Semarang line since June 31,1999.
Overseas transportation either for export or import activities is dominated
by foreign ships. In 1998, domestic shipping fleet transported 53,650,000
tons/meter cubic of cargo, while in 1997, it carried 72,250,000 tons/meter
cubic of cargo or decreased by 25.74%. In 1998, the overseas shipping fleet
carried 239,190,000 tons/meter cubic of cargo or decreased by 27.17%. A
number of 6,765,998 passengers were transported in 1998, while in 1997
it only carried 4,693,382 passengers or increase of 44.16%.
The crisis of economy has resulted in the fall of air transport demand
optimited by the decrease of people's purchasing power and it inflicts
a loss to airline companies.
Financial condition of airline companies is worsen by the fact that
80% of their operational cost must be paid in US$ currency.
The increasing of tariff has been done five times, of equivalent with
121.5% but it did not help to overcome operational deficit, even making
the fall of demand. Meanwhile, to improve the quality of air transport
services in Irian Jaya, the government had conducted development activities
during the fiscal years of 1998/1999 and 1999/2(300 that covering the enhancement
of building facilities in 20 airports, including those of pioneer airports,
the supply of operational subsidy for 28 flight routes.
Furthermore, in anticipating condition in East Timor, in order to prevent
disintegration, the development is still continued, that covering the maintenance
of runway facilities, prevention of erosion in Komoro airport, Dili, supply
of subsidy for two pioneer air transports.
The implementation of Haj-Pilgrims transportation in 1999 was not dominated
anymore by PT. Garuda Indonesia, but it was also carry out by Saudi Arabia
Airlines. Realization of Haj-Pilgrim number in 1999 transported from six
airport embarkation since February 24, 1999 until March 21, 1999 was 70.695
persons of 99.46% of 71.078 persons registered, consisting of 182 "klotters"
In the framework of telecommunications reform, the government has carried
out the formation of Blue Print on Reform Policy for Telecommunication
sector in order to organize the industries in the future. There are three
principal innovations implemented essential by Indonesian in telecommunication
sector, namely: (a) to abolish all forms of monopoly: (b) to remit all
discriminations and restrictions to private sectors: (c) to specialize
the government role as promoter.
The government also started operating the Sea Cable Communication System
of optical fiber to link Surabaya-Ujung PandangBanjarmasin on May 31. 1999
which will be operated as the nodes to connect Indonesia's West Region
and East Region.
Further on May 17. 1999. the government signed the issuance of the first
day stamp and telephone-card and the officiation of Homepage MKT-2000.
Indonesia also enhances foreign cooperation in transportation sector
in the type of bilateral, regional and multilateral cooperation. At present,
Indonesia has signed four MOU's (Memorandum of Understanding) in transpiration
sector between Minister of Communications and his counterparts from Australia,
the Netherlands, the UK, and France. In air transport sector, the government
has signed the agreement with 61 countries in the world. At present, 34
international airline companies from 29 countries operating to and from
Indonesia also actively participates in international transportation
organization, such as International Civil Air Transport Organization (ICAO),
International Maritime Organization (IMO), World Meteorological (WMO),
Economic and Social Commission for Asia Pacific (ESCAP), WTO/GATS cooperation.
International Telecommunication Union (ITU) and Universal Postal Union