RECENT ECONOMIC REPORTS

INDONESIA: 
ENVIRONMENT, SCIENCE &TECHNOLOGY, AND HEALTH HIGHLIGHTS
JANUARY/FEBRUARY 2005

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Tsunami Environmental Damage

Apart from the devastating loss of life, the December 26 earthquake and tsunami also wreaked havoc on the environment of the coastal areas of Aceh.  Many scientists believe that marine life in tsunami-damaged beach areas could take centuries to recover.  The Director of Conservation International in the Indonesian resort island of Bali, Ketut Sarjana Putra is one of those who shares this viewpoint.  He noted that the ocean's sea grass bed, and mangrove and coral ecosystems suffered immense damage, which could take centuries to recover.

The GOI has recognized the importance of addressing the severe environmental damage to Aceh and North Sumatra even as it struggles to cope with the human tragedy of the earthquake and tsunami.  For FY 2005, the Ministry of Marine Affairs and Fisheries allocated 75.1 billion rupiah (about USD 8 million) for the rehabilitation of marine and fisheries infrastructure in Aceh and North Sumatra.  In addition, the Ministry has received grants, loans and technical equipment from a number of donor countries to help it address this problem.

Mangrove Rehabilitation

The GOI said the rehabilitation of coastal mangrove forests is integral to the overall recovery of the affected regions.  Thus the Ministry of Forestry has included the rehabilitation of damaged mangrove forests in these areas in its new five-year plan.  Secretary General Wahyudi Wardoyo said that the tidal wave destroyed 40,000 hectares of mangrove forests and that it would cost 200 billion rupiah (USD 21.5 million) to rehabilitate them. (Note: This works out to USD 539 per hectare, which would seem to be an underestimate, but Forestry Ministry officials confirmed that the figures are correct.)  Wardoyo added that the GOI would provide 800 billion rupiah (USD 86 million) to rehabilitate 150-200 thousand hectares of tsunami-damaged mangrove, coastal and inland forests.

 The rehabilitation program is in line with the proposed spatial plan for coastal cities drawn up by the Ministry of Marine Affairs and Fisheries and the Indonesian Institute of Sciences (LIPI).  The plan entails setting up 2-3 mile buffer areas of mangrove forests, fish farms, and plantations between the coasts and major towns and cities.  In addition, the media quoted the Head of Foreign Cooperation and Investment Bambang Murdiono as saying that the International Timber Organization (ITTO) agreed to donate USD 30,000 in emergency funds to support preparatory work on this project. (Note: Indonesia receives around USD 2 million per year out of the ITTO's USD 15 million annual grant budget). 

U.S. Geologist says Indonesia Needs GPS Base Scanners

A prominent U.S. geologist, Dr. Kerry Sieh of the California Institute of Technology (Caltech), told the press on January 5 that Indonesia needs 150 units of GPS base scanners to detect fractures of earth-plaques along the western beaches of Sumatra and Mentawai islands.  Sieh said the equipment would cost about USD 13 million.  Indonesia currently has only four GPS base scanners, all of which are located in the Mentawai Islands.  Dr. Sieh has collaborated for 10 years with the Indonesian Institute of Sciences (LIPI) on research in Sumatra and the Mentawai islands.  He noted that the Mentawai islands continue to shift about 1.6 inches every year toward the northeastern beaches of Sumatra, and that these movements are potential factors in future earthquakes and tsunamis.

IPB and Shigeta Build Avian Flu Plant

The Bogor Institute of Agriculture (IPB) and Japanese firm Shigeta Animal Pharmaceuticals Inc. announced that they are collaborating to build three avian flu (AI) vaccine plants that will use proprietary genetic technology.  Shigeta holds an avian flu vaccine patent developed by Shigeta Animal Pharmaceutical Inc and America Medlemmune Inc.  Shigeta's initial investment of USD 945,000 will provide for software, hardware and buildings.  Shigeta and IPB's first vaccine plant at the IPB campus in Darmaga has a monthly production capacity of 15 million avian vaccines and 1.5 million cat vaccines.  A second plant at IPB's Gunung Gede Campus with a monthly production capacity of 60 million avian vaccines and 6 million cat vaccines was scheduled for completion in February 2005.  Shigeta hopes to complete a third plant in Bogor, West Java by April 2005 that will produce 300 million avian vaccines and 30 millions of cat vaccines every month.  PT IPB-Shigeta Director Widiyanto Dwi Surya told the media that once all three plants come on line, they would represent the world’s largest AI vaccine production facilities. 

Malaysian Proposal to Combat Illegal Logging

Indonesian Minister of Foreign Affairs Hasan Wirayuda announced on December 9, 2004 that Malaysia had promised to reject illegal logs from Indonesia if the GOI allowed Malaysian firms to legally do business in the logging industry and export the products to Malaysia.  The Malaysian proposal reportedly first surfaced at a December 2004 meeting in Jakarta between Indonesian Vice President Yusuf Kalla and Malaysian Vice Prime Minister Najib Tun Razak. However, a number of Indonesian Members of Parliament reacted critically to the proposal, stating that they saw little or no evidence of commitment from Malaysia to cooperate with Indonesia in the fight against illegal logging.  The Chairman of the Indonesia Forestry Community (MPI) Sudrajad D.P. called on the GOI to reject the proposal.    

Other Forestry Tidbits

The head of the Ministry of Forestry’s Information Center Transtoto Handadhari announced on February 4 that an investigation into illegal logging had confirmed that China, Malaysia, and a number of African countries continue to import illegal logs (Merbau and Meranti) from Indonesia.  Transtoto noted that China alone had imported 98 million cubic meters of illegal Merbau and Meranti wood from Indonesia.  In addition, Minister of Forestry M.S. Kaban declared that 47 illegal logging barons were responsible for 500 billion rupiah (US$53.8 million) in lost GOI forestry royalties.  Kaban added that he was disappointed that although he had submitted the names of the 47 barons to the Attorney General for prosecution in October 2004, they had not yet been arrested.  Despite the lack of progress prosecuting the cases, some observers noted that publishing the names of alleged illegal logging kingpins represents an important demonstration of commitment by the Yudhoyono Administration to combat illegal logging.      

City of Jakarta Proposes A Smoking Ban

The City of Jakarta Assembly  (DPRD) approved on February 8 a law on air pollution control that, among other measures, criminalizes smoking inside public buildings.  Violations will be punishable by six months in jail and/or a fine of 50 million rupiah (about USD 5,555).  The Jakarta Post quoted Jakarta Governor Sutiyoso as saying that the bylaw was “an important measure to clean up the capital's air.”  According to a 2003 WHO Report, 60 percent of Indonesia’s 214 million people smoke, 5.7 percent of whom are heavy smokers.  A 2001 national survey estimated that 54.5 percent of Indonesian males and 1.2 percent of females smoke.  According to WHO statistics, 40,000 Indonesians die each year from smoking-related diseases.

The no-smoking ban, which will take effect in February 2006, elicited praise from Jakarta residents and anti-smoking and environmental activists.  However, many fear that once the ban comes into force, it could go up in smoke due to weak enforcement, since existing regulations prohibiting smoking in public areas have not been enforced.  In addition, the GOI receives a significant amount of revenue from cigarette excise taxes, and cigarette manufacturers continue to sponsor major sporting and entertainment events in Indonesia. The City of Jakarta's new anti-smoking drive coincides with the entry into force February 27 of the WHO-sponsored Framework Convention on Tobacco Control (FCTC), which Indonesia has not yet ratified.

North Sumatra To Host Development Summit

The Province of North Sumatra will host the first "Summit of the Network of Regional Governments for Sustainable Development" (NRG4SD) March 10-12, 2005 in Lake Toba, North Sumatra.  The main theme of the conference will be "Global Partnership on Rehabilitation and Reconstruction of Post-Disaster Settlement," with an emphasis on the Aceh tsunami disaster. 

The network of Regional Governments stated it hopes to fulfill the goals of Agenda 21 and the Johannesburg World Summit of Sustainable Development (WSSD) 2002 Plan of Implementation.  The Network’s main objective is to be a voice for regional governments at the global level to promote sustainable development.  The Network is sponsored by North Sumatra Province, and co-sponsored by the United Nations Institute for Training and Research (UNITAR), the United Nations Human Settlement Program (UN-HABITAT) and the United Nations Environmental Program (UNEP).  Indonesia’s Department of Foreign Affairs, the State Ministry of Environment, and the Association for Provincial Government of Indonesia (APPSI) also support it.

New Role For Infectious Disease Hospital

Minister of Health Siti Fadilah announced February 15 that Prof. Dr. Sulianti Saroso Hospital in Jakarta would become an Educational Hospital for the treatment of infectious diseases, including HIV/AIDS, tuberculosis, dengue, measles and pneumonia, Japanese B Encephalitis, rabies schistosomiasis and leptospirosis.  The Minister said she hoped that the hospital’s change in status would improve research on the diseases.  She added that due to the new designation, the GOI would establish a modern laboratory (e.g., a biosafety 3 lab) and additional treatment rooms there.  

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