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Implementing Indonesia’s

Economic Master Plan (MP3EI):

Challenges, Limitations and

Corridor Specific Differences

June 2012

Prepared by Strategic Asia



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Table of Contents

The Concept of an Economic Corridor ................................................................................................... 12

Economic Corridors in Indonesia ........................................................................................................... 12

Implementation Phases of the MP3EI ..................................................................................................... 15

Barriers to Implementing the MP3EI ..................................................................................................... 16

Public Communication and Awareness .................................................................................................. 17

Synergy with the RPJP and the RPJM .................................................................................................... 19

Regulatory Reform .................................................................................................................................. 21

Institutional Reform ................................................................................................................................ 23

Infrastructure ........................................................................................................................................... 25

Regional Disparities ................................................................................................................................ 29

Human Resource Development .............................................................................................................. 33

Financing and Attracting Private Sector Investment .............................................................................. 35

Environmental Sustainability .................................................................................................................. 38

Differing Perceived Opportunities and Barriers to Implementing the MP3EI at the National Level and inthe Kalimantan and Bali- Nusa Tenggara Corridors. .................................................................................. 43

Implementation Requirements and Recommendations for the MP3EI ............................................... 47

International Experience of Implementing Economic Corridors ............................................................ 47

A Closer Look on East-West Economic Corridor of Greater Mekong Sub-region (GMS): TurningInfrastructure Corridors into Economic Corridors .............................................................................. 47

The Indonesia-Malaysia-Thailand Growth Triangle ........................................................................... 51

Roles of Stakeholders in the Implementation of the MP3EI ................................................................. 54

Current Structure of the KP3EI .............................................................................................................. 55

Level of Preparedness............................................................................................................................... 57

Sequencing ................................................................................................................................................. 57

Recommendations for the Implementation of the MP3EI at the National Level ................................ 59

Implementation Recommendations in the Kalimantan Corridor ........................................................ 60

Implementation Recommendations for the Bali- Nusa Tenggara Corridor........................................ 61

Conclusions................................................................................................................................................ 62

REFERENCES.......................................................................................................................................... 64 ANNEX ...................................................................................................................................................... 67



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Figures

Figure 1 - MP3EI Economic Corridor Map ................................................................................................ 11Figure 2 - Estimated Investment Required for the Main Economic Activities of the MP3EI .................. 14

Figure 3 - Implementation Phases of MP3EI .............................................................................................. 15Figure 4 - Barriers to Implementing MP3EI ............................................................................................... 16Figure 5 - Infrastructure Projects Under Construction ................................................................................ 28Figure 6 - Total Projects and Total Investments in the MP3EI ................................................................... 29Figure 7 - Regional Inequality in Indonesia ................................................................................................ 30Figure 8 - Indications of Investment in 6 Economic Corridors................................................................... 32Figure 9 - Factors for Doing Business in Indonesia .................................................................................... 36Figure 10 - Perceived Opportunities at the National Level ......................................................................... 43Figure 11 - Perceived Barriers to Implementation at the National Level ................................................... 43Figure 12 - Perceived Opportunities in the Kalimantan Corridor .............................................................. 44Figure 13 - Perceived Barriers to Implementing the Kalimantan Corridor ................................................. 44Figure 14 - Barriers in the Kalimantan Corridor broken down by frequency of mention: ........................ 45

Figure 15 - Perceived Opportunities in the Bali- Nusa Tenggara Corridor ................................................ 45Figure 16 - Perceived Barriers to Implementing the Bali- Nusa Tenggara Corridor .................................. 46Figure 17 - Barriers in the Bali- Nusa Tenggara Corridor broken down by frequency of mention: ........... 46Figure 18 - EWEC Linkages to National Development Plans .................................................................... 50

Table

Table 1 - The Economic Activities Promoted by the MP3EI per Corridor................................................. 13

Boxes

Box 1 - Key Points from the Low Carbon Economy Knowledge Hubs ..................................................... 41Box 2 : EWEC Flagship Projects ................................................................................................................ 47Box 3 IMT-GT Five Connectivity Corridors .............................................................................................. 51

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Implementing Indonesia’s Economic Master Plan (MP3EI): Challenges, Limitations and

Corridor Specific Differences1

Executive Summary

The Government of Indonesia announced the Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development (MP3EI) in May 2011. This has been followed by almostconstant debate surrounding the feasibility and the implementation challenges likely to be faced by the MP3EI. The fact that such an overwhelming amount of interest has been generated aboutthe MP3EI shows the willingness of stakeholders to take part in realising the success of the policy. It also demonstrates that not enough attention has been paid to implementationmechanisms and frameworks during the design phase of the MP3EI itself.

The MP3EI is a very ambitious plan. It aims to propel Indonesia into the top ten economies andraise per capita from US$3000 to US$15,000 by 2025. The policy rests on three main pillars:

establishing six economic corridors based on the comparative advantage of the different regionsof Indonesia; promoting connectivity within Indonesia and the ASEAN region, as well asimproving human resources and science and technology.

Implementation of the MP3EI, however, is its Achilles heel. The MP3EI document itself dedicates a relatively short space to map out the implementation and monitoring of the policy.This ambitious policy needs a strong implementation strategy to ensure its success.

At the national level, there are nine major barriers to the implementation of the MP3EI: a lack of socialisation and awareness; unclear synergy with the RPJMN (Indonesia’s long termdevelopment plan); needs for both regulatory and institutional reform; underdeveloped

infrastructure; regional disparities; a need for human resource development; a lack of availablenational financing and disincentives to private investment and a perceived clash with committingto environmental sustainability.

Barriers found for the Kalimantan and Bali- Nusa Tenggara Corridors are found to be different ,although all stemming from a general theme at the national level. As such, recommendations for the implementation for the two regional corridors are not the same.

This indicates that each of the six Corridors will be unique in their implementation strategy.Indeed, the MP3EI states that each corridor has its own theme based on the comparativeadvantage of that region. Furthermore, implementation relies on a number of factors such as

levels of infrastructure, human resources, institutional capacity, amongst others. As such, it islikely that the implementation experiences from one Corridor cannot be copied to another. Thissuggests then, that the idea of using a pilot corridor should not be undertaken, but instead all sixcorridors be implemented simultaneously. Implementing the first phase of the MP3EI should

1The UK Foreign and Commonwealth Office in Jakarta contracted PT. Strategic Asia Indonesia between August

2011 and April 2012 to undertake a project looking at the implementation barriers, requirements andrecommendations for the MP3EI.



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occur at the same time as the implementation of increased research and planning to develophuman resources, invest in science and technology, developing basic infrastructure as well as aregulatory and institutional reform.

General recommendations for the national level are:

The first task is to create effective on the ground awareness and familiarity with theobjectives, design and key stages of the Master Plan. At present, Government officials atthe national level overall had a much better understanding on the meaning, opportunitiesand requirements for implementing the MP3EI as compared to the private sector and civilsociety.

A clear set of expectations from different groups of stakeholders needs to be established,as now there is cross over in expectations of different stakeholders- particularly betweenthe private sector and government officials. Increased available information for the

private sector as well as inclusive public communication are the first steps in establishinga long term working relationship between the private sector and government toimplement the MP3EI.

A regulatory review to ensure that the MP3EI can be supported by laws and regulationswhich are streamlined through the regional and national level.

MP3EI Working Units need to be established which coordinate regularly with thenational level. These groups should involve a breadth of stakeholders and their targetsand quarterly progress should be made available as public information.

Improving basic infrastructure should be seen as a national government priority in order to attract private investment in commercial infrastructure.

An Action Plan needs to be developed on looking at the short and long term needs of developing human resources in each of the six corridors. At the moment, it is not clear inthe MP3EI where funding is to be sourced to establish training centers and other resources develop Indonesia’s man power. The MP3EI document lays out a breakdownfor the infrastructure budget, but there is a lack of a breakdown of a budget for humanresource development.

An Action Plan needs to be established on the strategies when moving from an

infrastructure to an economic corridor learning from the international experience.

The national PPP framework needs to be reviewed, projects need to synergize betweenthe national and regional level, with only feasible projects which are ready to commenceadvertised. The President also needs to take the lead at the national figurehead for thedevelopment of PPPs in Indonesia.



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A review of the financing budgeted for the eastern parts of Indonesia needs to be carriedout as eliminating regional disparities are a priority for the MP3EI but yet there is a lack of financing in eastern Indonesia which acts as a barrier to growth and also privateinvestment.

An important theme in the implementation of the Kalimantan Corridor was the perceived clashwith efforts to become more environmentally sustainable. Connectivity was an important issue asat the moment there is a lack of sharing of information between Kalimantan’s four provinces,however this was much more of a prominent theme in the Bali- Nusa Tenggara Corridor sincethis corridor aims to pull together a series of islands. Eastern Indonesia also has more prominentissues in underdeveloped basic infrastructure and human resources, far much more thanKalimantan. As such, special attention should be given to the Bali- Nusa Tenggara Corridor aswell as other eastern Corridors in constructing basic infrastructure with the overall aim to reduceregional disparities.

In terms of sequencing, similar to the East- West Economic Corridor of the Greater MekongDelta Sub- Region, the MP3EI has dedicated the first phase of the implementation process from2011 to 2015 as solely in infrastructure investment. The purpose behind this is to increase theinter-corridor connectivity and set basic foundations for the second phase. The East WestEconomic Corridor found relative success in the infrastructure phase, and significant increasedtrade and investment flows as a result. However, difficulty was found in the move from aninfrastructure corridor to an economic corridor.

For the second phase of the MP3EI, covering the period from 2015 to 2020, attention needs tomove further down to the regional level. After infrastructure corridors are established, theregional government should have a better awareness and ability to fulfil its roles. Increased

responsibility at the regional level for implementing MP3EI would serve as a faster method of implementation rather than at the national level and each Corridor would be able to adapt to itslocal situation easily. The MP3EI should not be bound to a one size fits all policy, but the regionsshould have the capacity to implement the policy according to the different needs and abilities of each corridor.



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Introduction

BackgroundThe Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development

(MP3EI) is the government’s most prominent economic development policy in the last decade.This ambitious policy aims to leapfrog Indonesia into the ten biggest economies by 2025, byincreasing GDP to US $4.5 trillion as well as by increasing GDP per capita income from US$3000 now to US $15,000.

Under Presidential Regulation No. 32/2011, President Yudhoyono launched the MP3EI policy inMay 2011 and the policy was supported by sectoral ministries, local governments and state-owned enterprises. The MP3EI has huge potential to develop economic growth through the promotion of six economic corridors: the Sumatra Economic Corridor, the Java EconomicCorridor, the Kalimantan Economic Corridor, the Sulawesi Economic Corridor, the Bali- NusaTenggara Economic Corridor and the Papua- Kepulauan Maluku Economic Corridor.

The MP3EI policy centres around three main strategies: to develop the six national economiccorridors, to speed up the development of human resource capacity and national science andtechnology which will feed into the long term support of such accelerated economicdevelopment.

The total investment required for the six corridors is Rp. 4,012 trillion. From this total, it isexpected that the Sumatra Corridor will receive Rp. 714 trillion (18% of total investment), theKalimantan Corridor will receive Rp. 945 (24% of total investment), the Java Corridor willreceive Rp. 1,290 trillion (32% of total investment), the Sulawesi Corridor will receive Rp. 309trillion (8% of total investment), the Bali-Nusa Tenggara Corridor will receive Rp. 133 trillion

(3% of total investment) and lastly the Papua- Kepulauan Maluku Corridor will receive Rp. 622trillion (15% of total investment).

The Master Plan identifies eight primary programs and 22 primary activities as the focus of national development. The eight primary programs are: agriculture, mining, energy, industrial,marine, tourism, telecommunications and the development of strategic areas. The strategicinitiative of the Master Plan is to encourage large-scale investment in 22 primary activities:shipping, textiles, food and beverages, steel, defence equipment, palm oil, rubber, cocoa, animalhusbandry, timber, oil and gas, nickel, copper, bauxite, fisheries, tourism, food and agriculture,the Jabodetabek area, the Sunda Straits strategic area, transportation equipment, and informationand communication technology.

Fundamental to the MP3EI policy is the importance of promoting a new way of thinking- “NotBusiness as Usual”. This new ideology is to come from increased collaboration and inputs fromnational government, local governments, state-owned enterprises, private sector companies andlocal communities.

The Indonesian Government has limited funds to finance development through its State Budget(APBN). According to the MP3EI, 44% of the total investment needed is expected to come from



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the private sector and state-owned enterprises. Under the MP3EI, all existing regulatoryframeworks must be evaluated, and strategic steps must be taken to revise and changeregulations in order to attract such support from investors. Incentives will be implemented ontariffs, taxes, import duties, labor regulations, licensing and permits and land procurements. In

order to achieve these goals, the central and local governments must build a stronger link withinand beyond the centers of economic growth.

Although the policy lays out a promising plan to advance Indonesia’s economy, it has often beennoted that its Achilles heel is in the implementation stage. Others have noted that theGovernment’s previous large scale development acceleration programmes in Indonesia have notfulfilled their promises, such as the 2007 Presidential Instruction on real sector developmentacceleration and the 2010 Presidential Decree on acceleration of poverty reduction.2

The Committee on Economic Development Acceleration and Expansion of Indonesia 2011-2025(KP3EI) is an institution established by the President of the Republic of Indonesia on May 20,

2011 to coordinate the implementation of MP3EI.

The Master Plan recognises that Indonesia must overcome a number of challenges: a failure toachieve value-added input in the agricultural and extractive industries; a developmental gap between western and eastern Indonesia; the lack of infrastructure support generally; a lack of connectivity between regions; inadequate quality of human resources and rapid urbanisation.

The steps to realise the Master Plan include: bureaucratic reform, including the legislature and judiciary, tax reform and incentives, the creation of special economic zones in each of thecorridors, improved shipping and airline capability (ports and airports) to promote connectivity,and increased high school and vocational training to improve human resources. Many elements

in the plan are unique points of departure for Indonesia. For example, the Master Plan states thatthe Government bureaucracy will support the needs of business and provide equal treatment andfair opportunities for all businesses, Government loans will be used to finance investment insteadof routine expenditures, such as subsidies and subsidies will be targeted at the disadvantagedrather than for goods, taxes will be on Indonesian sourced income and not worldwide income,taxes will be based on consumption rather than value added taxes, and employment regulationswill be supportive of employers as well as employees.

Evidence Used in the Study/Data Sources This paper highlights the key barriers to implementing the MP3EI policy and makesrecommendations for successful implementation. Using an evidence-based approach, this paper

makes reference to data collected during past meetings with stakeholders. Since this project hasmainly looked at the implementation barriers and requirements at the national level andspecifically at the Kalimantan and Bali- Nusa Tenggara Corridors, the bulk of the

2Business Section, ‘I’m not optimistic with the MP3EI: economist’, The Jakarta Post , July 25

th2011



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recommendations are made for national level as well as Corridor specific recommendations for the Kalimantan and Bali- Nusa Tenggara Corridors.

Data has been collated from meetings and interviews with government officials, members of the

private sector and of civil society from all of the six Economic Corridors as outlined in theMP3EI. PT Strategic Asia Indonesia facilitated four seminars, two at the regional level and twoat the national level in order to gather opinions from a wide range of stakeholders. A marketresearch company, the Polling Center, based in Jakarta, supported PT Strategic Asia Indonesiaand undertook three rounds of interviews with project stakeholders. During the length of this project, the Strategic Asia team gathered data from a wide range of sources from across theIndonesian archipelago.

Field trips took place in East and Central Kalimantan, Lombok, Bali, Aceh and Makassar inorder to gather area specific data needed to supplement project research, as well as to gainsupport for two regional seminars which occured in Kalimantan on 6 th October 2011 and in

Lombok on 6th

December 2011. Both seminars addressed the specific needs of the regions; thefirst addressing the Kalimantan Corridor and the second the Bali- Nusa Tenggara Corridor. In preparation for our two regional seminars, trips were made to Central and East Kalimantan for the first seminar and to Lombok and Bali for the second in order to meet key stakeholders,speakers and with the BAPPEDA offices in order to secure cooperation in co-hosting theseevents.

Strategic Asia undertook meetings in Jakarta in preparation for the third and fourth seminar entitled ‘Climate Change Mitigation and the MP3EI’ and ‘Implementing the MP3EI on the National Level’. These seminars were both two day events and took place on the 8th and 9th of February 2012 and 14th and 15th March 2012, respectively. Apart from guests from Jakarta, both

seminars also featured one international speaker from London and included participants fromacross Indonesia: Sumatra, Kalimantan, Sulawesi, Bali, Lombok and Papua.

Strategic Asia also signed a contract with an Indonesian market research company, the PollingCenter in August 2011. The Polling Center attended the Kalimantan, Lombok and the ClimateChange Mitigation and MP3EI seminars to undertake one to one meetings with participantsalongside the event. A broad range of stakeholders were interviewed, from government officials,members of the private sector, NGOs, Universities, research organizations, and the Donor community. A total of 18 interviews were conducted during the Kalimantan seminar and 20additional interviews were conducted during the Lombok seminar. After the two regionalseminars, the Polling Center conducted 38 interviews in Jakarta. Details of the interviewees can

be found in the Annex of this report. During these three rounds of interviews, the Polling Center quantified data on the awareness of the MP3EI; views on perceived opportunities coming fromthe MP3EI; barriers and solutions for implementation; synergy with the RJPMN (the mediumterm development plan) and roles of stakeholders.

Verbatim quotes from these stakeholders coming from interviews with the Polling Center can befound throughout this paper separated in text boxes.



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Furthermore, focus group discussions were a large feature of this project. All four seminars weremade up of a panel sessions with presentations as well as smaller breakout discussions withspecific issues for discussion. The agendas, participant attendance lists and seminar summariesfor all four seminars are provided in the Annex for further information.

Alongside preparation for seminars, Strategic Asia staff also met with key stakeholders in Jakartaas part of collating and consolidating research.

Extensive secondary research has also been ongoing throughout the life of this project. Data has been collected from government resources, secondary literature and Indonesian and internationalmedia.



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Figure 1 - MP3EI Economic Corridor Map

Source: MP3EI p. 46

The Six Economic Corridors

1. Sumatra Economic Corridor as a “Centre for Production and Processing of NaturalResources and As Nation’s Energy Reserves”

2. Java Economic Corridor as a “Driver for National Industry and Service Provision” 3. Kalimantan Economic Corridor as a “Centre for Production and Processing of National

Mining and Energy Reserves” 4. Sulawesi Economic Corr idor as a “Centre for Production and Processing of National

Agricultural, Plantation, Fishery, Oil & Gas, and Mining” 5. Bali – Nusa Tenggara Economic Corridor as a “Gateway for Tourism and National Food

Support”

6.

Papua – Kepulauan Maluku Economic Corridor as a “Centre for Development of Food,Fisheries, Energy, and National Mining



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The Concept of an Economic Corridor

The Asian Development Bank’s definitions of an Economic Corridor are as follows3:1. A well-defined geographic area which includes transport arteries such as roads, rail lines,

or canals.2. It highlights on bilateral initiatives and focuses on strategic centers particularly at border

crossings between two economies3. It emphasizes the physical planning of the corridor and the surrounding area by focusing

on infrastructure development and optimal maximization of benefits.

Economic corridors aim to attract investment and generate economic activities in a particular region in view of realising the economic development potential of a given region with essentialfeatures of lower distribution costs and improved land acquisition. Physical links and logisticsfacilitation are key elements towards achieving these aims. Physical connectivity between thecentres of economic growth will be significantly developed upon massive investments in

infrastructure. Moreover, improved infrastructure, partnered with cross-border cooperationamong the neighbouring countries, can accelerate the process of integrating the country’seconomic corridors into the global market. Successful implementation of economic corridorsrequires strong political will with the placement of appropriate infrastructure as well asstreamlined competitive regulations to facilitate the movement of goods and people.

Economic Corridors in Indonesia

Growth centres, connectivity and infrastructure are the main building blocks of the IndonesianEconomic Corridors. Economic growth centres will be developed through industrial clusters andspecial economic zones (SEZ). These economic hubs will be developed in each economic

corridor in line with the local potentials and specialisations of each region. For instance, theMP3EI identifies Kalimantan as an energy hub, Bali as a tourism hub and Sumatra as an agro-industry centre. These different types of economic activities need to be accompanied byimproved connectivity and infrastructures links.

To facilitate the movement of goods and services across economic corridors, connectivity between regions should be developed to accelerate and expand economic development.Connectivity infrastructures such as construction of transportation routes and information andcommunication technology (ICT) within and across the regions will reduce transportation andlogistical costs. Infrastructure improvements in roads, seaports, airports, water, energy andelectricity, and others are also needed according to the economic activity required in the mainindustrial clusters. Therefore it is crucial for these infrastructures to be of high quality if acompetitive final product is desired. In addition, the provision of the various infrastructuresacross the corridors will need a pool of skilled workers who are experts for each type of economic activity.

3 Ruth Banomyong, “Benchmarking Economic Corridors Logistics Performance: A GMS Border CorssingObservation”, World Customs Journal



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Table 1 - The Economic Activities Promoted by the MP3EI per Corridor

Source: MP3EI p.48 and p.49



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Figure 2 - Estimated Investment Required for the Main Economic Activities of the MP3EI

Source: MP3EI p.50



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Implementation Phases of the MP3EI

Figure 3 - Implementation Phases of MP3EI

Source: MP3EI p.50

As illustrated above, Phase 1 (2011-2015) intends to focus on the implementation andoperationalisation of the MP3EI implementing committee. One of the action plans prepared isthe debottlenecking of different pending regulations, licenses, incentives and the commencementof investment commitment. All of the pending regulations and permits at the national andregional level must be revised to support the development of main activities related to spatialmanagement, man power planning, regional tax, application of communal land, mineral and coalmining business uncertainty, simplification of business patterns in the oil and gas industry, private sector participation in providing electricity, renewable energy, defence equipment,railways, airports, tourism, and Public Private Partnerships (PPPs), among others. See Annex for

a detailed list of the pending laws.

Moreover, strengthening of national connectivity is a priority for Phase 1 by assigning primaryseaports and airports as international exchange centres in western and eastern Indonesia. Humanresources development, research facilities, research activities and other capacity buildingactivities will also be strengthened to serve as a good foundation for the first phase.

Phase 2 (2016-2020) intends to focus on the acceleration of long term infrastructuredevelopment, increasing innovation to boost competitiveness, improvement of economicgovernance in various fields and the promotion of industries that will create added value.

Phase 3 (2021-2025) will leverage on the competitive advantage of national industries globallyand high level technology adaption for future development projects. Successful implementationof converting the infrastructure corridors into economic corridors will also take place in this phase.



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The Action Plan, for successful implementation of the MP3EI, will be discussed later in thisreport. This action plan has considered the international experience specifically from the Lower Mekong Delta Action Plan and the Indonesia-Malaysia-Thailand Growth Triangle Action Plan.

Barriers to Implementing the MP3EI

Figure 4 - Barriers to Implementing MP3EI

Barriers to

Implementing

the MP3EI

1. Public

Communicationand Awareness

2. Unclear

Synergy with theRJPMN

3. A Need for

Regulatory Reform

4. A need for

InstitutionalReform

5.

Underdeveloped

Infrastructure

6. Regional

Disparities

7.

UnderdevelopedHuman Resources

8. Lack of

National Financing

and Disincentivesto Private

Investment

9. Clash with

EnvironmentalSustainability



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1. Public Communication and Awareness

No other policy initiative has received either such ahigh profile or so much attention in the entire period

following the collapse of the New Order.

However, a lack of awareness amongst keystakeholders is a significant finding of this project.Despite the fact that the MP3EI sets out to implementthis project in a ‘Not Business as Usual’ mindset byinvolving stakeholders in a collaborative approach,we have found that there is a disparity in awarenessand knowledge of the MP3EI amongst governmentofficials and members of the private sector and civilsociety organizations. Notably, various levels of

awareness and knowledge were also found acrossdifferent areas of Indonesia. As expected, it wasgovernment officials as a group who were the mostknowledgeable about the concept of the MP3EI.Furthermore, government officials who wereinterviewed in Jakarta had a better understanding of the MP3EI than their regional counterparts.

As yet, there is no ‘virtual secretary’ or one websitededicated to the MP3EI. This acts as a barrier tospreading awareness on the MP3EI, as there is not

one central source of information which can informstakeholders about the concept and ongoingimplementation of the policy. Many members of the private sector have raised this as a concern. Nothaving access to regularly updated information, onrelevant laws and regulations in particular, would actas a barrier to investing, as noted by many membersfrom the private sector.

Interviews undertaken in Kalimantan show that whilst all three categories of respondents possessed a fairly good awareness of the MP3EI, there was a tendency for the respondents from

the government group to have a deeper awareness on the policy. Generally, most of the participants of the Kalimantan seminar held in October 2011 were aware of the MP3EI, but somestated that they had only researched the MP3EI following the invitation of the seminar.Importantly, local government officials noted that they felt that the central government weremuch more aware and, therefore, prepared for the implementation of the policy. Interviewsduring the Lombok seminar showed that from the three categories of respondents, the privatesector and civil society had a lower level of understanding of the MP3EI than government

Verbatim Quotes from the Polling Center in response to the question on thesocialisation of the MP3EI:

“…I feel that the MP3EI might be just another government strategy that has

just been packaged differently…” Private Sector, Kalimantan Seminar

“…The biggest obstacle the MP3EI facesis the danger of conflict that will arise

during the implementation since theactual planning of it was neither discussed nor consulted with relevant

stakeholders and the community wholives in the targeted areas of

development…” Civil Society, Kalimantan Seminar

“.. To be honest, I have only brieflyheard about the MP3EI and it seems to

me that it will be much focused on thedevelopment of each respective

region...” Private Sector, Lombok Seminar

“…It is only after attending this seminar that I knew about the MP3EI…” Government Official, Lombok Seminar

“.. It is still a one-way relationship withthe MP3EI… Maybe later on will the

government feel it necessary to make a

special effort to socialise the MP3EI ...” Government Official, Jakarta



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officials. Although the government had a much better understanding of the MP3EI, manyanswers were limited to giving the definition of the MP3EI.

Members of civil society organisations in particular stressed the need to involve the indigenous

people of Kalimantan in the implementation of the MP3EI. As mentioned in the outcomes of the breakout sessions of the Balikpapan seminar, participants were weary of the possible rise intensions and resistance from indigenous peoples during development policy implementation likethe MP3EI. Similarly during the Lombok seminar, one participant from Kupang University notedthat the local customs and traditions of groups in Nusa Tenggara Timur must be respected andinvolved in making economic development plans, otherwise the government runs the risk of marginalising these groups, which could lead to social conflict. During the National LevelSeminar in Jakarta, Dr. Deddy Hadriyanto from Mulawarman University raised the sameconcern. Bapak Deddy stated that the use of traditional customary law is still very strongamongst many groups, such as the Sasak people in West Nusa Tenggara. As such, there may be potential tension if drastic economic development does not respect the rights of such groups. It is

vital, therefore that effort is made to discuss with all groups of society about such large andimportant plans like the MP3EI.

Furthermore, under the KP3EI (the Commission on the Acceleration and Expansion of Indonesia’s economic growth) the organisational structures set up for the implementation of theKalimantan and Bali- Nusa Tenggara Corridors show that the majority of the people involved aregovernment officials. The President, Governors, Mayors, Para Walikota and Ministers have beenallocated as main stakeholders in the MP3EI Implementation Task Teams and Secretariat.Organisational diagrams to demonstrate these can be found in the ‘Action Plan’ section of thisreport.4

Economist Fadhil Hasan has argued that the MP3EI has been prepared as a top-down Master Plan, by the centre for the regions and that there are still many regions that are sceptical to theMP3EI plan. "In order for the regions to have a sense of ownership over MP3EI, there should befurther socialisation to the regions. Moreover, so far, it is the governors that have been involvedin the discussions, not the regents, who have the autonomous authority," he has stated.5

Ultimately, involving all stakeholders is the only way to hear the views of the people who the policy will affect. Such socialisation is necessary to achieve implementing a policy which can benefit as many as possible, which essentially is the core aim of the MP3EI.

4 AusAID Indonesia Infrastructure Initiative, as taken from Kompas Newsaper, 9 th June 20115 AusAid Indonesia Infrastructure Initiative, as taken from Kompas Newspaper, 9 th June 2011



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2. Synergy with the RPJP and the

RPJM

Law No. 25/2004 regarding the NationalDevelopment Planning System mandated theintegration of Indonesia’s long, medium termand annual development plans. This alsoindicates that the Law acts as a legal umbrellafor the implementation of development plans inorder to guarantee the achievement of thecountry’s goals.

The National Long Term Development Plan(RPJPN) 2005-2025 has become the basis for development programs for a period of 20 yearscommencing from 2005 to 2025. In addition,RPJPN 2005-2025 also serves as a guideline for the preparation of the National Medium TermDevelopment Plan (RPJMN) which is adevelopment program 5 years in length. Thequestion that arises here is to what extent doesthe MP3EI synergise with the RPJPN and theRPJMN?6

The majority of spokespersons in the nationalmedia have expressed a positive attitudetowards the synergy of the policies. For example, Wahyu Utomo, the head of MP3EIintegration programme at the Office of theCoordinating Ministry of Economic Affairs at aconference in Yogyakarta stated that the MP3EI programme is complementary to the NationalMedium-Term Program Plan (RPJMN).7 Similarly, the Provincial Secretary of NusaTenggara Barat delivered a welcoming speechat the Lombok Seminar which expressed theoptimism that both sets of policies are aligned.Dr. Ir. Max H. Pohan, CES, MA, DeputyMinister for Regional Development and LocalAutonomy Affairs of National DevelopmentPlanning, BAPPENAS has stated that the two

6 National Connectivity 2011 Special Edition, Sustaining Partnership, “The Connectivity of Six Economic Corridors” 7 Wahyu Utomo speaking at MEP UGM, Yogyakarta, 23rd December 2011.

Verbatim Quotes from the Polling Center inresponse to the question on the synergy amongthe RPJP, RPJMN, and MP3EI:

“.. It is synergised because the RPJPN is moreon the general approach, but the MP3EI is more

focused on the national and regional economy

with all its pre-requisites to achieve economic growth and push the economic growth withvarious conditions. In this case, the regulations,mindset of the people, and institutionalisation

should be right …” Government Official, Kalimantan Seminar

“.. It is synergized with two considerations (i) fairness in distribution of funds for eachcorridor (ii) commitment of local and central

government..” Civil Society, Kalimantan Seminar

“.. The MP3EI emphasises more the role of the private sector in its implementation whereas the RPJPN focuses more on the development activities purely funded by the government…” Government Official, Lombok Seminar

“…The MP3EI is the best amongst the existing development plans since it basically focuses ona long term national development plan that can

only be implemented in accordance with the government’s capacity…”

Private Sector, Lombok Seminar

“..To be honest, I do not know the details of the RPJPN and the MP3EI ..” Private Sector, Lombok Seminar

“…Althoug h not yet quite obvious, the

synergies should be found since there are probably several components of the RPJPN that is similar to that of the MP3EI ...” Government Official, Jakarta

”.. At the very least they should have a link.They can probably complement each other withregard to developmental support. As part of a

business society, I expect a synergy between the MP3EI and RPJPN. The important thing is that the y don’t overlap or veer off the course...” Private Sector, Jakarta



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policies are complementary but that their difference lies in their implementation: the MP3EI promotes the private sector as the main actors, whereas under the RPJPN, the government is themain actor for implementation. The reason for the promotion of the private sector as the mainactor for implementing the MP3EI is because a large proportion of the financing for the projects

is expected to come from the private sector.

Most of the stakeholders interviewed by the Polling Center throughout this project also statedthat they believed that the two types of policy can synergise, since they are both based on similar founding principles.

Overall, participants from the Kalimantan Seminar had the view that the MP3EI’s vision andmission are aligned with the RPJPN. A few participants viewed the MP3EI as a part of RPJPN,due to its coverage areas (divided into corridors); however, since its field (MP3EI is primarilyeconomically focused) is different from RPJPN’s, therefore, the implementation of the MP3EI’swas viewed as different from the RPJPN. However, the Polling Center also found that such

synergy can only occur if supported by a number of conditions including: intensive commitmentand communication between the central and local government, aligned policies between thecentral and local government and zero-deviation from the implementation actors of MP3EI.

Participants from the Lombok Seminar on the whole had the view that the two programmes can be synergised because they viewed the MP3EI as an elaboration of the RPJPN, however they hadthe view that the MP3EI is focused on developing infrastructure, while the RPJPN’s scope is broader.

Government officials in Jakarta who were interviewed by the Polling Center had anunderstanding of the differences and similarities between the RPJPN and the MP3EI. However,

the majority of respondents were not able to say whether the MP3EI would support the RPJPN or vice versa.

Despite the fact that there is generally a good feeling that the two programmes can be aligned, itmust be taken into the account that the previous section of this paper highlighted the fact that amajority of stakeholders are under informed about the MP3EI. Therefore it can be argued thattheir knowledge of the ability of the MP3EI to synergise with the RPJPN and RPJMN is limited.

Furthermore, the process to assign stakeholders to implement the MP3EI is still under process, sothere is not a clear policy as yet on how the tasks to implement the RPJPM, RPJMN and theMP3EI will be separated or merged.



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3. Regulatory Reform

Being the centre of all structural reforms, regulatoryreform is a vital component of the first phase (2011-

2015) of the Master Plan. The first phase of the MP3EIaims to:

At the national level: re-evaluate cross sector regulations and restructure permit applicationsrelated to spatial management, labour, taxation andthe ease of capital investments8; and

At the local level: review regulations and permitsconcerning the mineral and coal, forestry andtransportation sectors as well as basic infrastructure.9

For investments in infrastructure to occur, the MP3EIrecognises that a number of regulations need to beremoved, aligned or reviewed in at least seven nationallaws, seven government regulations, five presidentialregulations, presidential decrees, presidentialinstructions, nine ministerial regulations and a number of local regulations and permits. 10 The Annex containsa list of these proposed changes. So far, twenty sevenregulations have been completed, eleven regulations are being revised, and eight regulations are to be revised.11

Banking on large private sector investments means that the Indonesian government will need tocreate a more favourable and conducive environment that can win the trust of the private sector through orderly regulations, fewer risks for misinterpretation, increased trust and the utmost participation from investors in this process. The main problem is that Indonesia currently doesnot have an independent regulatory review agency or an implemented Regulatory ImpactAnalysis. Horizontal and vertical inconsistencies and overlapping laws and regulations remainmajor issues that upset domestic and regional investment climate as well as hurdle infrastructure projects.

Findings from the Polling Center data show that constraints could arise when the concept of MP3EI is applied on the ground considering the current regulations and policies as well as

worries about overlapping government policies. For example, regulations and political partieswhich change frequently in line with changes in the political leadership represent an obstacle

8 MP3EI 2011-20259 MP3EI 2011-202510 Asia Pacific Economic Cooperation, 2011, “Indonesia’s Structural Reform Priorities”, Residential TrainingWorkshop on Structural Reform Singapore11 From a presentation given by Dr. Ir. Dedy S Priatna, MSc, Deputy for Infrastructure Affairs, Bappenas during theUK FCO Strategic Asia ‘Implementing the MP3EI on the National Level’ Seminar, Jakarta, 14 th March 2012.

Verbatim Quotes from the PollingCenter in response to the question onthe government regulations:

“...The biggest barrier that everyinvestor talks about is the lack of

regulations and standardised issues...” Private Sector, Kalimantan Seminar

“...The government always restricts

the flexibility of the private sector;there is not even a distinction madebetween ownership and contracts even

though the government is incooperation with the private sector.

This is the biggest obstacle faced at the moment... Current regulations

must be reviewed to stimulate the private sector’s work and must bebacked up by the law...”Government Official, Jakarta Seminar

http://aimp.apec.org/Documents/2011/SOM/WKSP/11_som_wksp_009.pdf




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much lamented by business people. In light of this, it is necessary that all policy-makers and thecountry’s legislative body have a clear understanding and strong commitment to adhere to the principles of the MP3EI and RPJPN in making any further or revising policies and regulations.Concerns from civil society about information relating to environmental regulations, the freeing

up of land, taxation, import duties, and tenders were also present. Members of the private sector and civil society stated that they wanted transparent access to information and regulations relatedto the programme. The private sector also expressed that they desired information on new policies or changes to existing rules in both the national and regional level. The private sector also felt that it was vital that such rules and regulations be amended, since the current state of inconsistent policy from province to province creates a barrier for investors. Increasedconsistency in policy and available up to date information on policy changes will make it easier for private sector investors to easily assess the viability of investments and act quickly when theysee an investment opportunity. Moreover, members of the private sector and civil society are both aware of the need for clear and consistent regulations in order to get rid of investor doubtssince these regulations would also affect the business players on their business expansion

activities while keeping up to local traditions and customs.

Delay of Land Acquisition EnactmentDespite the passing of the land acquisition bill, the parliament has postponed the issuance of its presidential regulation12. Although the government intended to issue the regulation on February2012, it could not push through since the draft regulation submitted by the National LandAgency (BPN) still requires further discussion and clarification.13 The issuance of the presidential regulation on the Land Acquisition is expected to be finished within six monthssince the passing of the bill, which is June 2012. This has resulted in a prolonged process of passing a law which many see as a progressive instrument for improving the country’s physicalinfrastructure.

To remove the reluctance of the private sector to take part on the Public Private Partnerships(PPP) programs, the finalisation of the Land Acquisition Law and Spatial Planning Law (RTRW)are essential in realising the desired huge private sector participation in infrastructure projectsand in allowing the progress of the MP3EI to move forward. Our findings from the PollingCenter reports further implies that until this Law is passed and fully implemented, there remains bottleneck issues and confusion at the local level as to what land would be used for business pursuits, mainly in oil and gas, coal mining, and what land needs to be protected as part of thePresident’s commitment to reduce greenhouse gases by 26% in 2025.

Enactment of Tax Holiday Regulation

In August 2011, the most anticipated tax holiday regulation (Minister of Finance Regulation No.130/PMK.011/2011) was enacted to provide two types of tax facility, namely (i) corporateincome tax exemption and (ii) corporate income tax deduction. An income tax exemption for five to ten years will be granted to businesses in “pioneering industries” starting from the year tax of the corporate taxpayer’s production. Issuance of this regulation is expected to boost

12 Jakarta Post, “Enactment of land acquisition law delayed again”, 14 th March 201213 Jakarta Post, “Enactment of land acquisition law delayed again”, 14 th March 2012



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investments in infrastructure, attract increased numbers of foreign investors, and ramp-upresource-based manufacturing industries.

One of the worth mentioning stipulations under the Tax Holiday Regulation is the provision that

administers the possibility to prolong the exemption or deduction of corporate income tax. The provision entails two elements to be regarded which are the preservation of national competitionand an evaluation of the strategic value of a particular business.14 The lack of clarity in terms of explaining when or how national competition needs to be maintained or the limitations of understanding the strategic value of a particular business may cause various interpretations of this stipulation or provision. Since multiple interpretations of this provision may lead touncertainty and ambiguity, the Indonesian government should clarify these provisions toeffectively implement the goals of the Tax Holiday Regulation.

Infrastructure BondsTo help finance the needed infrastructure projects, the national government is preparing to issue

infrastructure bonds. Such bonds should immediately be issued in order to make plans toaccelerate infrastructure development a reality. By providing a government guarantee, bondswould attract investors.15 Directorate General of Debt Management Rahmat Waluyanto recentlyannounced that such infrastructure bonds will not be issued until February or March 2012.16

4. Institutional Reform

Many stakeholders throughout this project argued that a large barrier to the implementation of the MP3EI lies in the poor capacity of institutions, especially at the regional level; corruption anda mismatch of communication and information between the national and regional level.

CorruptionPost ‘Big Bang’ decentralisation in 2001, many scholars have argued that corruption has actuallyincreased as national control over the regional government has decreased. 17 Indeed, a year after regional autonomy entered into force, a wave of corruption cases swept across Indones ia’s newlyempowered regional parliaments. Commencing with the most storied case in West Sumatra in2002, other regions followed soon thereafter – South East Sulawesi, West Kalimantan andLampung. Virtually all regions saw allegations of corruption emerge. In 2006, there were 265corruption cases involving local legislative bodies with almost 1,000 suspects handled by prosecutorial offices across Indonesia.

14SSEK Law firm website, “ 2011 Indonesian Law Review on Tax Holiday”, Accessed on 2nd April 201215 Investor Daily, 28 November 2011, “WITHOUT EXTRAORDINARY BUDGET, MP3EI ONLY A DREAM:Infrastructure Bonds to be Issued Soon”, By Esther Nuky

16 Govt to launch global bonds in February 2012 Oleh Agust Supriadi December 19, 2011 17 Taufik Rinaldi, Marini Purnomo and Dewi Damayanti, ‘Memerangi Korupsi di Indonesia Yang Terdedentralisasi’World Bank, May 2007



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However, recent years have seen corruption on thedecline. This could be due in part to increasedfreedom in the media following the end of the NewOrder which has encouraged public comment and

transparency in fighting corruption. Indeed,President Susilo Bambang Yudhoyono hasreaffirmed that his administration has zerotolerance on corruption. He noted that “theCorruption Eradication Commission has been prolific in their investigations of graft, with notablesuccess since its inception.”18

The international community is yet to catch up ondomestic progress on and corruption is still seen asa problem in Indonesia. Indeed, Mr. Jonathan

Mantle, an international expert from London whospoke at the National Level seminar, Jakarta, onMarch 14th 2012 noted that from the international perspective, Indonesia’s reputation for corruption isnot investable. In 2011, Indonesia was ranked at3.0 on Transparency International’s CorruptionPerception Index, rising from 2.8 in both 2010 and2009.19 Corruption becomes a barrier since theMP3EI relies on such large amounts of privatesector investment, including foreign investment.

Coordination between the Regional and NationalGovernmentMembers of the Private Sector who wereinterviewed during the ‘Climate Change Mitigationand the MP3EI’ seminar noted that theimplementation of the MP3EI is constrained by alack of coordination between central and localgovernment, especially concerning overlappinglaws as regulations as discussed in the last section. Participants from the private sector who wereinterviewed at the Kalimantan Seminar also argued that they receive different information on

laws and practices at the regional and national level, and thus this is confusing and, as a result, isa deterrent to investing. As already discussed, a lack of awareness at the local government iscurrently a barrier to implementing the MP3EI. This stems from a lack of an inclusive policy toshare data and plans between the national and regional government. David Ray, Director of theIndonesia Infrastructure Initiative (IndII), an AusAID-funded facility to promote economic

18 President Susilo Bambang Yudhoyono, in The Oxford Business Group, Indonesia edition March 2012, p 1919 Corruption Perception Index, Transparency International, 2011. Where 10 equals a very low level of perceivedcorruption and 0 equals a very high perceived level of corruption.

Verbatim Quotes from the Polling Center inresponse to the question on thecoordination between the regional andnational government:

“..The local government is unprepared.

The implementation at the local level is not easy since the community should also betaken into account. Aside from that, the

RPJMN and the MP3EI should also be synchronized…” Government Official, Kalimantan Seminar

“... There is an obstacle on thecoordination between the central and theregional governments because I haven’t

seen proper coordination between thetwo…”Private Sector, Jakarta

“…an overlapping of authority and

stipulations has happened to an extent, aswell as a lack of clarity as to the

developmental priorities themselves. Thiscould continue unless the regional

governments will be cooperative..” Private Sector, Jakarta

“…There is a lack of synchronizationbetween the centre and the regions. What’s

more the spirit of autonomy in the regionsbrings its own obstacles. Also there havebeen clashes with communities over land

disputes which have yet to be resolved – also national planning tends to overlap…”

Civil Society, Jakarta



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growth through improvements in both the quality and quantity of Infrastructure in Indonesia, particularly in urban areas has spoke about the lack of coordination between the national andregional level. He has stated that central to the findings of Indll’s first phase is that institutional problems, rather than resource constraints, are the primary reason for infrastructure failures.20

Change in MindsetThroughout the project, many stakeholders have emphasised for the need of a ‘change inmindset’ at the national and r egional level in order for each region to synergise commitmentfrom all levels of government. Indeed, the MP3EI needs the backing of political will from allechelons of government. However, implementing this is not easy and there is no one fixed policyto implement such change.

5. Infrastructure

The national government has shown its commitmentto overcoming infrastructure challenges in theMP3EI as well as in the current medium termdevelopment plan (RPJMN) for 2010-2014.

Deputy for Facilities and Infrastructures of Bappenas, Dedy Supriadi Priatna, has estimated thatthe investment needed to implement the sixEconomic Corridors reach the magnitude of Rp4,012 trillion. Of that amount, about 43 percent, or Rp 1,725 trillion, is needed for infrastructure

development. Meanwhile, the government'scontribution is only about 10 percent in the form of basic infrastructures, such as roads, ports, airports,railway network, and power plants. Privatecompanies and state-owned enterprises are expectedto play a major role to meet these investment needs.

Poor Infrastructure Prevents Economic GrowthThe current poor quality of infrastructure is one of the main factors preventing Indonesia’s economyfrom growing at its potential rate of 8 percent.

Inadequate infrastructure also results in highinflation compared to most of Indonesia’s peers inSouth East Asia. Infrastructure development has been slow in the past decade and has relied heavilyon government spending. The government has thusfar not allocated sufficient funding for infrastructure

20 AusAID Indll

Verbatim Quotes from the Polling Center in response to the question on the provision of infrastructure:

“…To improve the qualities of

infrastructure and human resources, wehave to educate our human resources

properly. They should participate in

activities such as internship, or educational training to increase their

knowledge and improve their skills sothat when investments come, they are not only workers, but they can also be

individuals that we can form partnerships with...”

Government Official, KalimantanSeminar

“…The infrastructure has two types:basic and social. Basic infrastructure

includes the roads, ports, and bridges.Social infrastructure includes the

Indonesian language, institutions, and regulations...” Private Sector, Lombok Seminar

“..There must be synergy between the

MP3EI and RPJPN. MP3EI is oriented towards infrastructure while RPJPN

generally has both physical and non-

physical aspects...” Government Official, Jakarta



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development, while participation from private investors is still far below what is needed.Compared to other ASEAN-5 countries, many of Indonesia’s main airports and seaports areoutdated and often overcrowded.21 Meanwhile, electricity supply needs to be boosted to meetsurging domestic demand.

Standard Chartered Indonesia ran scenarios in February 2011 to assess the impact of infrastructure development in the transport and electricity sectors. The best plausible outcomesshowed that Indonesia’s economy will grow between 7.1-7.6% between 2011-2014 if the privatesector participation rate reaches 50% of what is required and if the government increasesspending on transport infrastructure by 20% a year.22 Importantly, if the state-owned electricitycompany PLN increases annual capex by 20% and if private sector participation reaches 50% of what is needed, then growth could reach 6.9-7.5% over the same period.23

ElectricityAs of February 2012, the electrification ratio of Indonesia stood at 71% with a target of 75% by

the end of 2012 and 90% by the end of 2014.24

There are regional disparities in the growth of thissector, with the Java Island having a much higher rate of growth compared to other regions inIndonesia. Indonesia as a country also falls behind its neighbours in the region. Singapore’selectrification rate is already at 100% whereas Thailand and Malaysia currently stand atapproximately 90%.

ICTIndonesia currently stands at 109th place in the E-Government Index, whereas neighboursMalaysia, Singapore and Thailand stand at 32nd, 11th and 76th place, respectively. A 2011 WorldBank report found that increasing broadband connection by 10% results in a 1.12% increase inGDP per capita in developed countries and 1.38% in developing countries.25

Water Eastern Indonesia lags behind in clean water supply as compared to other regions, especiallyJava.26 The Kapuas, Kapuas-Barito, and Mahakam river basins represent 70% of Kalimantan’s population and area, and 40% of the river basin area located inside the Heart of Borneo. Achange in hydrograph of the river and increased demand for water for palm oil or other agricultural sectors could lead to a lack of water in the dry season. Possible water users that mayexperience negative impact are water companies, water-dependent industries, irrigatedagricultural lands, palm oil companies and local communities.27

21

Edward Lee Wee Kok, Eric Sugandi, Fauzi Ichsan, Jennifer Kusuma, Tai Hu, Indonesia Update, StandardChartered Indonesia, 14 February 201122 Ibid 23 Ibid 24 Antara News, “PLN Targets Serving 90% of Households by Late 2014”, 7 th February 201225 Mastel, (Indonesian ICT Society) ‘Toward National Connectivity- Challenge and Opportunity), Dr. Setyanto P.Santosa, Chairman of Mastel, Jakarta 21 September 2011 Presentation.26 BPS Statistics, Value of Cleaned Water Distributed (Million Rupiah) 1995 – 2008. A table showing this data can be found in the Annex.27 Heart of Borneo: The Economics of Ecosystems and Biodiversity (HoB-TEEB). December 2011



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Poor Infrastructure Prevents Private InvestmentThe Regional Secretary of Buleleng, Bali, Nyoman Sukarma, expressed that Buleleng's efforts tolure investors could be in vain, as the regency faced problems in meeting the increasing demandfor electricity and telephone lines. Due to inadequate infrastructure, economic potential is yet to

be met. Despite the current availability of electricity in Buleleng, the regency, which is includedin the Java-Bali interconnection power grid, suffers power shortages due to a lack of power stations. Buleleng is also an example of lack of synergy between the regional government andstate owned enterprises, as the Regional Secretary stated “We can develop new roads with our budget, but the policies of state-owned electricity company PLN and state-ownedtelecommunications PT Telkom regulate the electricity and telephone lines. I'm afraid our effortsto lure investors will be useless without a clear policy from the two state-owned firms.”28

Stakeholder ViewsThe Balikpapan Seminar also highlighted the importance of investing and developinginfrastructure in Kalimantan. Participants argued that the opportunities created by the MP3EI

would not be realised until sound infrastructure could be developed. Furthermore, a presentationgiven by HSBC in the Lombok Seminar stressed the importance for the national and regionalgovernments to take the lead in basic infrastructure, whereas commercial infrastructure could beleft to the private sector. As yet, a clear distinction from the national government between thetwo types of infrastructure is lacking.

Power supply to support infrastructure is currently inadequate to support the implementation of the Kalimantan and Bali- Nusa Tenggara Corridors. Throughout the Balikpapan seminar, many participants were weary of the irony of the fact that although Kalimantan has a huge energyresource, its own electricity supply is inefficient and often leads to unpredictable blackouts. TheMP3EI states that the fishing industry is one which could be expanded in Kalimantan. However,

uncertain supplies of electricity have meant that this area has not attracted as many investors as itwould have otherwise.

Priority of Infrastructure as the First Phase of the MP3EIRealising the importance of this barrier to the MP3EI, the Indonesian government has prioritisedthe first three years of the implementation of the MP3EI solely to building basic infrastructureand progress has already begun. Between May and December 2011, Rp 461.6 trillion has already been spent on implementing the MP3EI programme, involving 91 infrastructure and economicdevelopment projects. In 2011, the budget was 20.6 trillion, and for 2012 it is expected that Rp36.7 trillion will be spent on infrastructure.

Infrastructure Projects already in Construction The table below shows the number of infrastructure projects which have already begun in eachof the six economic corridors. However, what immediately stands out is the disparity betweenthe regions, with Java, Sumatra and Sulawesi receiving much more of the capital than other regions. Many individuals from the private sector who were consulted as part of this projectstated that building basic infrastructure is a necessary requirement before any investment will

28Jakarta Post, “Asian Development Bank Calls RI’s New Economic Plan Realistic”, 14 th June 2011.



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take place. For example, PT Chareon Pokhphand, Bali, a company specializing in selling chicken products, discussed at the National Level Seminar in Jakarta how they would want to expandtowards Nusa Tenggara Timur, but were restricted by the lack of reliable electricity resourcesand roads in the eastern parts of the Corridor.

Figure 5 - Infrastructure Projects Under Construction

Source: From a presentation given by Dr. Ir. Dedy S Priatna, MSc, Deputy for Infrastructure Affairs, Bappenasduring the UK FCO Strategic Asia ‘Implementing the MP3EI on the National Level’ Seminar, Jakarta, 14 th March2012.

Poor Infrastructure and Regional Disparities

Figure 6 also shows that the plans for infrastructure investment allow for much higher levels of financing for the Sumatra and Java Corridors than for the remaining four. Increasing investmentin infrastructure in Java and Sumatra, but failing to recognise the need in eastern Indonesia couldhinder the growth and levels of investment in eastern Corridors and affect the economic growthof Indonesia as a whole.



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Figure 6 - Total Projects and Total Investments in the MP3EI

Source: From a presentation given by Dr. Ir. Dedy S Priatna, MSc, Deputy for Infrastructure Affairs, Bappenasduring the UK FCO Strategic Asia ‘Implementing the MP3EI on the National Level’ Seminar, Jakarta, 14 th March2012.

6. Regional Disparities

Essentially, the purpose of the MP3EI is to raise the GDP per capita from $3000 to $15,000 by2025 whilst raising the living standards of Indonesia’s population. Therefore, fundamental to preparing the implementation of this policy must be the priority of equaling economic growthand investment amongst the six economic corridors.

Government spokespersons, for example, Dr. Ir. Endah Murniningtyas, M.Sc., Deputy NaturalResource & Environment, BAPPENAS, during her keynote speech at the ‘Climate ChangeMitigation and the MP3EI’ seminar, discussed that the disparities of Indonesia’s regional

economic growth are a huge problem. Thus it is the aim of the MP3EI to focus on thedevelopment outside Java. However, looking at the financing allocation in the MP3EI it can beseen that the eastern islands of Indonesia are still to receive less funding than their westerncounterparts.

Moreover, Dr. Ir. Max H. Pohan, CES, MA, Deputy Minister for Regional Development andLocal Autonomy Affairs, National Development Planning Agency (BAPPENAS) argued that thesuccess of regional development determines the success of national development. Therefore,



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despite the fact that the MP3EI has increased national and regional funding, insufficientfinancing to the eastern parts of Indonesia is likely to hinder the overall growth of the countryand is likely to worsen regional disparities. Although not stated by Dr. Pohan, allowing increasedregional disparities could arguably result in unity issues within the archipelago.

Figure 7 - Regional Inequality in Indonesia

Considering that the private sector have expressed a need for basic infrastructure to be in place before planning to invest, it can be argued that not funding eastern Indonesia with enough moneyto secure basic infrastructure, hinders its growth and could fall further behind growth seen inSumatra and Java. Lack of financing also means that the development of human resources andscience and technology are also stunted, and critically, private sector investment in such areas becomes less attractive compared to areas such as Sumatra and Java which are becoming moredeveloped, have easier access to information, better human resources and better qualityinfrastructure.29

Notion of Geography in EconomicsA spatially diverse nation such as Indonesia allows for great variations in the endowment of various provinces and districts and their ability to compete for a greater share of Indonesia’sfuture economic development. Factors such as being blessed with natural resources, connectivity

29 Dr. Ir. Max H. Pohan, CES, MA, Deputy Minister for Regional Development and Local Autonomy Affairs, National Development Planning Agency (BAPPENAS), presenting at a conference entitled ‘Implications of MP3EIon Manpower Planning’ Jakarta 22 December 2011



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and quality of infrastructure as well as a conducive business environment can set one province or district apart from the other. The Java Island currently has a considerable advantage over the restof the archipelago due to better quality of infrastructure, higher levels of density of industry aswell as higher availability of skilled labour.

Varied Economic Growth in the RegionsThe economy of the Sumatra region grew by 5.9% (YoY) in 2011, higher than its averagegrowth in the last three years of 5%. This economic growth has largely been supported byincreasing performance of the agriculture sector, especially the plantation sub-sector of palm oiland rubber and supported by growth in the manufacturing industry. The performance of theTrade, Hotel and Restaurant sector also grew by 7.5% (YoY). Similarly, economic growth inJava was also high, and in 2011, growth stood at 6.7% (YoY). This growth was supported by the performance of the industry and trade sectors. Export growth was also high in Java- from 16.3%in the third quarter of 2011 to 19.9% (YoY) in the fourth quarter. Such good performance hasresulted from an increase in inter-island trading, since Java is one of the agricultural industry and

production centres and, thus can distribute its products to other regions in Indonesia. Similarly,growth in Jakarta throughout 2011 reached a high of 6.8% (YoY), higher than the 2010 growthof 6.5% (YoY) with strong consumption indicating the strength of the rising middle class inIndonesia.30

However, looking at the Eastern part of Indonesia shows another story. Kalimantan, Sulawesi, Nusa Tenggara, Maluku and Papua have had lower economic growth compared to 2010. Thislower economic growth was mainly due to labour strike and technical problems faced by manymining companies, especially PT. Freeport in Papua. Whilst in 2010 economic growth was at6.0% (YoY) in 2011 growth was at 5.5.% (YoY). Despite this, many infrastructure projects areattracting investment such as the Ngurah Rai airport and the Sanggaran- Nusa Tenggara toll

road, both in Bali. Construction has also began on the Tayan Bridge which connected WestKalimantan to Central Kalimantan. This particular project had required investment of approximately Rp 575 billion.31

Varied Levels of Investment in the RegionsThe Investment Coordinating Board (BKMP) has noted that the majority of both domestic andforeign investments have not been equally distributed to all regions in Indonesia, and today mostinvestments are still concentrated in the Java island. This has implications for regionalconnectivity since there is a well-known problem that the outer regions feel that they are caughtin an unfair exchange, since many of their exports go to prop up the development of the JavaIsland, but receive less back in terms of investments.32

The Indonesia World Development Report of 2009, illustrated that during the 1970s-1980s some provinces were consistently wealthy (Jakarta, East Kalimantan and Riau) and other provinceswere consistently non poor (North Sumatra, Central Kalimantan, West and East Java, Bali and

30 Office of Chief Economist, Mandiri Bank, Indonesia Update, February 2012 p17-1931 Office of Chief Economist, Mandiri Bank, Indonesia Update, February 2012 p21 32 BKPM website: Regional Champions 2011, BKPM website



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West Sumatra) and others were consistently very poor (Nusa Tengarra, South East Sulawesi andMaluku).33 However, after the 1980s, export oriented provinces such as Java and Bali grewsignificantly faster because of export oriented manufacturing with the determining factor beingconnectivity to global economy. The national media has noted that budget allocations to eastern

Indonesia are lacking and stand as a barrier to economic growth and increased livelihoods.34

Currently, the Java Island reaches 62% (equal to approximately USD 12.3 billion) of the totalforeign direct investment and 49% of the total domestic investment. In reaction to this, theBKPM hope to establish the seven ‘Regional Champions’ in 2012: Nanggroe Aceh Darussalam,West Sumatra, Central Java, West Kalimantan, North Sulawesi, Central Sulawesi and SouthSulawesi. This initiative hopes to push for more domestic and foreign investment to Indonesia’sregions by rewarding the regions who have attracted investment and provided a good service for its investors.35

The MP3EI sets out the estimations for investments across the six economic corridors. Most of

the domestic and foreign investments are also distributed in the Java economic corridor whichamounts to a total of IDR 148 trillion, equal to 59% of the total investment. Finance split up for other corridors is as follows in Figure 8.

Figure 8 - Indications of Investment in 6 Economic Corridors

Source: MP3EI

33 Consistently “wealthy” and consistently “poor” were defined as those close to the national average and those thathave experienced a significant change in relative incomes.34 Jakarta Post, “Nusa Tenggara Provinces Need More Investment”, 26 th October 201135 BKPM website: Regional Champions 2011, BKPM website



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7. Human Resource Development

The MP3EI economic development plan envisionsan expansion in economic activity and a shift

towards higher value added production throughimproved technological and skilled labour inputs.The desired expansion of existing industries andadoption of new processes, however, will requireconsiderable expansion and adjustments to thelabour supply. If the ambitious growth targets are to be realised, the planned output increases for eacheconomic activity that shall contribute to theseincreased growth rates will have to be met. This willdefinitely require right human resource mobilisation.

At present, Indonesia’s education system is not producing enough skilled workers to reach the targetlevels of development. Moreover, calculations of theoutput of each economic activity are still lacking aswell as the occupation structure of each of them.This lack of information may cause a delay inmaking the provisions required for educating theworkforce.

Indonesian training centres are also mismatchedwith the planned corridor development.36 Socialising

the concept of MP3EI with the training institutionsis still an issue. There are still many provincialgovernments that are still not aware of the placementof the training institutions. Moreover, there is also alack of political will and commitment among the provincial governments from each corridor incoherently aligning their structures and plansaccording to the MP3EI. What’s more, overall human resource infrastructure is lacking as peoplefrom the field of training and education are not yet ready for the implementation of the MP3EI.

Weak harmonisation and integration of programmes between institutions is also a serious case.37

According to the speaker from Ministry of Manpower and Transmigration at the NationalSeminar in March 2012, the short term and long term plan for every sector must be in place tosupport the MP3EI in terms of human resource development. Accurate and up to date

36 Taken from the presentation of Abdul Wahab Bangkona (Dirjen Training and Productivity Development; Ministryof Manpower and Transmigration) on Jakarta Seminar, March 14, 2012.37 Taken from the presentation of Abdul Wahab Bangkona (Dirjen Training and Productivity Development; Ministryof Manpower and Transmigration) on Jakarta Seminar, March 14, 2012.

Verbatim Quotes from the Polling Center in response to the question on Human

Resource Development as a barrier toimplementing the MP3EI.

“... Another obstacle is the capacity of thehuman resources which are not yet readyto face the developmental challenges

facing Indonesia in the future”Government, Jakarta Seminar

“..The most important barriers are theneed to improve the quality of

infrastructure and of human resources.

We have to be brave enough to providecourses or educate our human resources,at least they should participate activities

such as internships or educational training in relation to increasing their knowledge so that when investments enter,they are not only workers, but they canalso be individuals that we can form

partnerships with..”Government, Kalimantan Seminar

“…The main issue for me is the human

resources, as the level of capacity of human resources is the largest factor affecting the progress of a region. If themindset of the community does not

change, then it will be difficult to advancethe region.….”Civil Society, Lombok Seminar



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information as well as training centres aligned with the specialisation of each economic corridor are necessary.

The Ministry of Education and Culture hopes to increase the number of engineering students.

The number of engineering students in Indonesia is comparatively low compared to BRICcountries, South Korea, Singapore and Thailand.38 As such, increasing the number of polytechnics, academies, and universities as well as improving the quality of training in theseinstitutions are needed if the Indonesian government wants to increase the number of engineeringstudents five-fold by 2025 to keep abreast with an accelerated economic development.

Upon transformation of an infrastructure corridor to an economic corridor, determining andaddressing potential skill mismatches is the key in generating job creation, higher economic productivity, competitiveness, and high growth in Indonesia. Through the MP3EI, the present pool of human resources is anticipated to meet the needs of all sectors in relation to the maineconomic activities of each Corridor. In making an effective strategy on manpower planning,

policy makers must therefore understand first the development needs of the MP3EI and alignthese needs according to the academic and vocational training programs, by tailor-fitting theacademic programs to the economic potential for each Corridor. Such vocational education programmes should produce skilled graduates that will support the industries for regionalcomparative advantage.

The MP3EI does not contain details of the manpower planning requirements for itsimplementation. As such, supply side analysis is required to detect skill gaps that exist based onthe outlined economic activity in each centre of growth in each corridor.39 Moreover, qualitylabour market information must be in place so that people can decide on informed choices abouttheir careers. Many jobs are present in the informal economy or no-contract jobs, which explains

the need to strengthen social dialogue to improve access to decent work. Entrepreneurship mustalso be promoted so that University graduates can become job-creators rather than job-seekers40.

Mapping out the manpower planning needs for Indonesia will be a tremendous challengingexercise as it requires detailed research in all sectors of economic expansion, strong time seriesdata, and substantial methodological capacity. In addition, projections of labour and educationrequirements based from project outputs are subject to various possibilities in productionmethods and labour market demand. This is likely to be a complicated process that cannot becarried out alone by the Ministry of National Education (MONE) as it requires the cooperation of other entities such as Bappenas and the Ministry of Finance to develop more accurate forecasts.Moreover, specific forecasts for the conditions of each one of the provinces of economic

corridors are also needed.

38 Taken from the presentation of Abdul Wahab Bangkona (Dirjen Training and Productivity Development; Ministryof Manpower and Transmigration) on Jakarta Seminar, March 14, 2012. 39 Taken from the presentation of Emma Allen (International Labour Organisation Indonesia) on Jakarta Seminar,March 14, 2012.40 H.E. Dr. Susilo Bambang Yudhoyono, Intenrational Labour Conference on June 14,2011.



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Source: MP3EI p49

8. Financing and Attracting Private Sector Investment

As shown, the MP3EI states that only 10 percent of the requiredinvestment needed for the implementation of the six economic

corridors will come from the government state budget. The rest isexpected to come from state owned enterprises, a mix of sources andat 51 percent, the majority is hoped to the raised by investment fromthe private sector.

A key theme raised during this project was the lack of incentives for the private sector to invest. Others have also argued that the privatesector have been relatively uninformed of the formation of theMP3EI, and thus are not aware of the opportunities for investing inthe policy.

Indeed, it must be considered that all barriers discussed thus far inthis paper allcontribute to anoverall barrier whichdoes not actively

encourage the private sector to invest in theMP3EI: lack of socialisation of the master plan,the need for regulatory and institutional reform atthe national and regional level, lack of soundinfrastructure and the need to improve humanresources. Lipseya and Sjoholm agree, arguing

that a ‘relatively poor business environment,inefficient government institutions, low levels of education and poor infrastructure all seem to beimportant explanations for the low inflows of FDI to Indonesia’.41

The table below demonstrates the seriousnessneed for institutional reform in corruption and bureaucracy as the two major barriers which canmake private sector investment unattractive.

Yet, in 2011 and 2012 Indonesia has seen itscredit rating upgraded. In 2011, Standard andPoor’s raised Indonesia’s bonds to BB+.Moody’s followed, upgrading Indonesia to Baa3,

41 Robert E. Lipseya & Fredrik Sjöholm, Foreign direct investment and growth in East Asia: lessons for Indonesia,Bulletin of Indonesian Economic Studies, Volume 47, Issue 1, 2011

Verbatim Quotes from the Polling Center inresponse to the question on the BiggestImplementation Barriers for the MP3EI

“.. The biggest barriers that every investor talks about are the lack of regulations and

standardised issues…”

“..The obstacle is in the regulation, either central or local regulations. Some local

regulations are overlapping, they should be synergized and government should be bold intaking actions toward local regulations that

need to be adapted. Definitely this will haveboth positive and negative impacts..”

“..Foremost is the implementation in theoperational level on the local involvement in

the process, meaning it is not only the statethat enters there, but we must address how to

strengthen the local involvement so thecommunity can feel the benefits..”

All views from members of the Private Sector,Kalimantan Seminar

Source: MP3EI

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http://www.tandfonline.com/toc/cbie20/47/1

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from Ba1.42 Similarly, Fitch ratings have upped their grading to BBB- from BB+, putting thecountry into investment grade after 14 years. Indonesia remains strong at 46th place in the WorldEconomic Forum Global Competitiveness Report 2011-2012.43 Furthermore, the governmentrecently announced that there has been an increase of almost Rp 1,000 trillion ($109 billion)

committed to the MP3EI, with the energy and transportation sectors attracting the most interest.With the revised pledge figure, by the end of February 2012 investors had committed toinvesting a total of Rp 4,925 trillion for the MP3EI.44

This seems to paint the picture that although large improvements are being made, suchmilestones are fairly recent, and thus it is vital to ensure the private sector of such improvementsand commit to the continuation of improving the investment climate.

The Transportation Ministry has requested Rp 4.17 trillion in additional funds to complete its projects, in particular developing new river and sea routes that will aid the movement of goodsand people. Such links will be vital for lowering business costs and accelerating economic

growth. Besides helping develop transportation in less-developed eastern Indonesia, the fund isalso to be spent on supporting the development of the MP3EI economic corridors.

Figure 9 - Factors for Doing Business in Indonesia

Source: Global Competitiveness Report, 2010-2011, World Economic Forum

42Mamta Badkar, “Indonesia Just Got Its Investment-Grade Credit Rating Back”, Business Insider, 19 th January201243 World Economic Forum, “The Global Competitiveness Report 2011-2012”. 44 Editorial ‘As MP3EI Blossoms, Resolve Is Needed’, March 13, 2012, Jakarta Globe



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Verbatim Quotes from the Polling Center inresponse to the question on the Roles of Government and Private Sector in theImplementation of the MP3EI.

“.. Bappenas and Coordinating Minister of

Economic Affairs conducts the planning process, APBN will be involved there, so the DPR will also enter at the implementation

level, eventually, the debate on the APBN will still take place at the DPR, how far will

they be committed? MP3EI is huge, the roleof APBN would probably be around 8%,

from the private sector 92%...”Government Official, Kalimantan Seminar

“..Definitely the most important actor should be the local government, then alsothe different associations who represent

some communities, say KADIN, APINDO,community groups, and private sector

associations, and academics can also provide a neutral opinion…”Private Sector, Kalimantan Seminar

“..All parties are very important. Theimportance of the government is from theaspect of policy making, budgeting and

spatial planning. Investment from the private sector is also essential as they are

directly involved in the project..”Government Official, Jakarta

“..The most important role is played by the government, as regulations stem from them.

The government formulates the rules..”Government Official, Jakarta

“..The government, because in a developing country, the government always takes a

leading position..”Private Sector, Jakarta

Furthermore, official international partnershipshave been made. For example, Indonesia andChina recently agreed on the establishment of aworking committee reflecting China's support of

the MP3EI. It is hoped that China will take part inthe implementation of the MP3EI, which has beenapparently welcomed by Wen, Antara newsagency reported.45

Opinions collected throughout this project found amarked contrast in the perceived roles of implementation and ownership of the MP3EI.Many government officials speaking about theMP3EI noted the importance of the private sector to contribute a large amount of money to finance

projects. Many government spokespersons thusargued that the private sector was the main drivingforce for the implementation of the MP3EI, andthat the government role should limited tooverseeing the implementation and to provide aconducive investment climate.

However, interviews with members of the privatesector show a miscommunication in the intendedroles of stakeholders for the implementation of the policy. Indeed, the verbatim quotes shown here

demonstrate that some members of the privatesector view the government as the main drivingforce for the MP3EI’s implementation.

Therefore, there is a risk that both groups of stakeholders will expect each other to be theimpetus for the MP3EI and as such no group willtake full ownership and responsibility for theMP3EI to meet its targets and goals.

Fiscal Decentralisation

The increase in fiscal autonomy at the regionallevel and implicit decrease in fiscal responsibilityfor the regions at the centre increases the variationin regional fiscal spending according to regional capacity rather than need. In the context of decentralisation, rather than the central government spending national funds equally across theregions or subsidising those in greater need, it becomes incumbent on regional authorities to

45Jakarta Post, “China Agrees to Support Indonesia’s Economic Master Plan”, 23rd June 2011.



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raise funds to bankroll their own fiscal spending. Government spending in each region istherefore determined by fiscal capacity at the regional level which in turn depends on regionalrather than national levels of economic activity. This sees a reduction in inter-regionalredistribution of public finances resulting in a failure to counteract the emerging inter-regional

inequalities that result from variable economic activity at the regional level.

Inter-regional variation in economic activity translates to variation in regional fiscal capacity

The existence of variation in economic activity across regions translates (in the absence of centrally enacted fiscal transfers) to variable fiscal capacity at the regional level which canincrease inequality where it is sensitive to levels of fiscal spending. Uneven fiscal spending canentrench interpersonal income inequalities, for example, when low income groups are unable toincrease their income levels through improved education and health outcomes and when they arevulnerable to income shocks in the absence of social protection mechanisms.

Regions receive variable fiscal funds when the capacity of regional authorities to raise funds,

primarily from the tax base, is variable. This might vary according to regional comparativeadvantage such as the extent of urbanisation, the size of the market, natural resourceconcentration, infrastructure, education levels of the citizenry and so on and according to theeconomic conditions set by the regional authority in terms of, for example, investmentregulation. When decentralisation has been initiated as a result of political concerns to address anuneven distribution of political sensibilities across the country, perhaps derived fromconcentrations of different ethnic groups in certain areas, the extent of policy variation of thiskind across regions is likely. For example, where decentralisation has been enacted to address theeconomic grievances of minority groups who feel they have been negatively impacted by marketfunctioning, a regional authority might represent their interests by disabling market forces. Thiscould reduce interregional inequality through redistributive state intervention but might increase

interregional inequality in the long term by hindering the region’s economic growth.

9. Environmental Sustainability

Climate change mitigation and the preservation of the environment are two major concerns thatarise when looking at this ambitious policy for growth and economic development. Alongsidethe MP3EI is Indonesia’s commitment to reduce carbon emissions. At the G20 PittsburghSummit in 2009, President Susilo Bambang Yudhoyono committed to reducing green house gasemissions by 26 percent by 2020 combined with its target of maintaining a 7% per year growthlevel. However, as yet the MP3EI is not aligned with the target to reduce carbon emissions. The

MP3EI policy itself is lacking in a concrete plan as how to increase economic growth whilst being environmentally sustainable.

Under the REDD+ initiative, Indonesia will expand the scope of its activities from avoideddeforestation and degradation, to include forest restoration, rehabilitation, sustainablemanagement and/or reforestation. Indonesia could earn up to USD $1 billion annually by sellingcarbon credits to industrialised countries. The World Bank has noted Indonesia’s progresstowards meeting its target of reducing greenhouse gases, stating that Indonesia is setting an



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example for other countries to follow. Yet, the REDD+ initiative, as one of the most significantways to mitigate climate change has not yet been integrated into the MP3EI policy. The REDD+initiative is only mentioned very briefly in the MP3EI itself, and does not specify how toimplement the initiative within the MP3EI.

Clash with Environmental Sustainability: KalimantanIssues surrounding Kalimantan’s environment in particular were prominent throughout this project. In a meeting with the head of BAPPEDA, East Kalimantan in September 2011, it wasdiscussed that the BAPPEDA staff were concerned that the MP3EI promoted only the extractionof non-renewable resources for the Kalimantan Corridor. The members of BAPPEDA feared thatif the region does not move towards value-added goods there will be a risk of economic shock when resources run out. During the first seminar in Balikpapan, East Kalimantan, the theme of environmental sustainability was raised as a particular concern for the implementation of theEconomic Corridor. Arie Rompas, Executive Director of WALHI, Central Kalimantan put forthhis opinion that a “development model that still relies on natural resource extraction ignores

environmental sustainability and causes ecological damage in Kalimantan.”

Climate Change Mitigation and the MP3EI Seminar

The third seminar in this project looked specifically at aligning climate change mitigation withthe MP3EI. On Wednesday 8th and Thursday 9th February 2012, the third seminar was held inJakarta to discuss how to align environmental sustainability with the MP3EI. A total of 85 peopleattended this two day event, including participants from across Indonesia’s regions as well as onespecial international guest, Dr. Vlasios Voudouris from the London Metropolitan University.Key findings from this Seminar are as follows:

Ir. Sulistyowati, MM. (Assistant Deputy Minister for Climate Change Mitigation and

Atmospheric Function Preservation, Ministry of Environment of Republic of Indonesia) notedthat so far, Indonesia has made progress to support climate change mitigation for example thePresident’s target to reduce carbon emissions by 26%. To support the implementation of this plan, the government has conducted a preliminary inventory of all economic daily activities fromthe lower level of government institutions such as the district level. Among various sources of carbon emission, the forest and peat land accounts for about 60% of the emission in Indonesiawhich means that the emission from this sector is substantially high.

Dr. Endah Murniningtyas, M.Sc., Deputy Natural Resource and Environment, BAPPENASnoted that the Greenhouse Gas National Action Plan consists of core activities, integrated amongsectors, to reduce emissions and support activities to strengthen policy framework. The six

economic corridors in the MP3EI Policy should be implemented across 33 provinces and it is better for each provincial government to prepare their own formulation of their GHG action plan.To smooth the implementation of the plan, each ministry and government institutions shouldhave consultations with their branch offices in the regions in order to arrange and formulate theregional action plan (RAD GRK). Furthermore, the plan could be cemented by implementing itas a Governor decree. For all 33 provinces, RAD GRK is a communication tool among regionsand also between regions and the central government. The government should realise thatsocialisation is key for the long term development of the plans.



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Dr. Ir. Kirsfianti L. Ginoga, M.Sc., Head of Research and Development Center for ClimateChange and Policy, Ministry of Forestry stated that REDD+ and other methods to mitigateagainst climate change need to be integrated with the MP3EI. Reducing emissions from forestry

is so important in Indonesia because approximately 80% of the country’s total emissions comefrom this sector. REDD+ should also be prioritised in certain parts of Indonesia such as the primary forest in Papua, Sulawesi and Kalimantan. The strategy of MP3EI and GHG NAP must be translated into land based mitigation in sectoral and at the regional level and programmes andactivities in each sector must be clear and operational for every location.

Nyoman Iswarayoga, Climate and Energy Program Director, WWF Indonesia argued that theMP3EI has neglected environmental sustainability. Therefore, considering that there are stillforested areas in Indonesia, such as Kalimantan, it would be a good step if we could create agreen zone for conservation. It then leads to an initiative of implementing Green MP3EI wherethere should be better management practices in agriculture and plantations, improving spatial

urban planning where it can be used as a reference in the development and the governmentshould strictly implement the approved spatial planning, Green Business Initiative, and GreenInfrastructure Development.

Dr. Daniel Murdiyarso, a Senior Scientist from CIFOR argued that in the Kalimantan Corridor,according to an analysis on Indonesia’s forest moratorium, implementing REDD+ will not beenough to meet the targets to reduce greenhouse gases. There should be multi-sector efforts to prepare a strong regulatory framework and law enforcement in order to integrate REDD+ intothe MP3EI. If we look at the Kalimantan Economic Corridor, the region’s theme is dedicated for a centre for the Production and Processing of Mining Goods and National Energy. The regionhas various challenges in reducing its carbon emissions because the capacity for storing the

carbon is fairly small since reforestation is not the solution for reducing emissions. The ever expanding oil palm plantations in Kalimantan are a huge challenge.

Prof. Dr. Daddy Ruhiyat, Executive Director of Climate Change Board, East Kalimantan statedthat the East Kalimantan region has been identified as region with the highest carbon emissions.The forestry and palm oil sectors are the biggest contributors to these emissions. Since theMP3EI promotes the forestry and palm oil sectors as well as other sectors using non renewableresources such as coal, the MP3EI in the Kalimantan Corridor does not promote environmentalsustainability. It is not clear how the MP3EI intends to work towards lowering environmentalsustainability in the Corridor.

Similarly, Benja Victor Mambai from WWF, Papua, spoke of the problem in connectivity inPapua due to underdeveloped infrastructure. In the future through MP3EI, it is hoped that therewill be an increased number of infrastructure projects to fulfill this need. In order to do so, thelocal government has prepared to improve spatial urban planning towards a goal of makingPapua more sustainable in their economic development.

Ir. A. A. Bagus Sudharsana, Dipl. PLG, Head of the Denpasar Environmental Agency, Bali,stated that actions have also been integrated into the Spatial Plan, however this has yet to be



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implemented. The local government wants to work on mitigating climate change also becausethey intend for Bali to be a tourist attraction for the long term. The local government also intendsto pay special attention to indigenous wisdom throughout the implementation of the programmes. The areas already to be investigated are air and water pollution as well as traffic

congestion.

It was argued by Heru Prasetyo, Deputy I, UKP4 as well as Dr. Rob Daniel Technical Advisor,PT PricewaterhouseCoopers Indonesia Advisory that environmental sustainability in the regionsmust actively involve local communities.

Heru Prasetyo also discussed that the commitment to reduce carbon emissions is not wellsupported due to unreliable data of the carbon warehouse or land coverage among ministries. Atthe same time the regulatory framework needs to be reviewed, in the sense that it shouldovercome the problem of overlapping regulations.

Dr. Dodik Nurrochmat, Center for Climate Risk and Opportunity, in South East Asia Pacific(CCROM – SEAP) argued that there are not enough financial incentives for stakeholders tochange trajectory and move to environmental sustainability. The national government needs toassess what financial offers can be made.

Box 1 - Key Points from the Low Carbon Economy Knowledge Hubs

This project also involved organising two Low Carbon Economy Knowledge Hubs, one in February 2012 and

one in March 2012 to discuss how to implement a low carbon economy in Indonesia. Key themes and

conclusions from these two sessions follow. Participants list for these events can be found in the Annex.

First Low Carbon Economy Knowledge Hub

Presidential Decree No. 3/2012 was passed on the Spatial Plan of Kalimantan. In this regulation, the

government confirmed that Kalimantan should maintain at least 45% of the land as forest. However, members

of the Low Carbon Economy Knowledge Hub argued that in Kalimantan there is currently no scientific based

research underlying the figures stated by the President both for the carbon emission reduction and also for the

forested areas.

Regarding the socialisation programme of Low Carbon Growth Strategy (LCGS) conducted in 14 districts,

research has found that most of the districts are not ready to implement the Spatial Plan. A general lack of

enthusiasm and low public awareness was a common theme when the LCGS team visited the 14 districts tointroduce the Spatial Plan. There should be a particular mechanism that might attract societies’ environmental

awareness so the public can also contribute to the program. Thus, even though the concept is ready to be put

on the ground, the implementation is currently delayed.

Regarding the Presidential Regulation No. 71/2011 and Presidential Regulation No. 61/2011 about

Greenhouse Gas Emission National Action Plan (GHG NAP) or RAN GRK, there is still an institutional

problem across provinces and regions in Indonesia. There should be working units for 5 sectors (forestry and

peat land; agriculture; energy and transportation; industry and waste) in each province. However it is unlikely

that each working unit is ready to implement activities stated on those government regulations.



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Second Low Carbon Economy Knowledge Hub

Many expected that when the government made a commitment to reduce carbon emissions by 26%, that the

government had already prepared funding allocation. In addition, if there is international funding available,the carbon emission reduction will increase by 41%. Stakeholders at the Hub noted, however, that it is likely

that the financial disbursement scheme will be unclear and unprepared. The government expects that the

general public should also take part in the government programs in reducing carbon emissions. However, the

government needs to make clear the funding and financial disbursement in order to attract the participation

of stakeholders.

There should be a safeguard mechanism and monitoring scheme to oversee the funding allocation. In

addition, the community should also be a part of the monitoring scheme. The public and particularly

indigenous groups need to be aware of the incentives that they will receive, but also that when they do

receive incentives it is for the purpose of preserving the biodiversity of the forest, which in the end also

serves to benefit themselves.

The differences between carbon mitigation and carbon sequestration need to be made clearer and socialised

to the general public, as there is confusion between the two.

Since moving to a Low Carbon Economy is still in its infancy, the first step should be work on capacity

building for carbon market readiness not only in mitigation but adaptation. Moving to a low carbon economy

needs to be integrated into the MP3EI and thus the MP3EI needs to be adapted to include low carbon

strategies which complement economic growth. The forestry, industry, tourism and fisheries sectors should

made priorities.



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Differing Perceived Opportunities and Barriers to Implementing the MP3EI at the NationalLevel and in the Kalimantan and Bali- Nusa Tenggara Corridors.

Data collected from The Polling Center has shown that perceived opportunities and barriers at

the national level as compared to the Kalimantan Corridor and Bali- Nusa Tenggara Corridor level generally do not stray too far from common themes. Despite this, however, there aredifferent emphases at the national level than at the regional level, as well as key differences between the social, political and economic make up of the Kalimantan and Bali- Nusa TenggaraCorridors.

With each of the six Corridors having a unique set of comparative advantages, the MP3EI has built upon these sets of regional characteristics to create unique themes for each corridor. Thus itfollows that since each Corridor has a different emphasis on economic activity, levels of poverty,levels of capacity of human resources and infrastructure, each Corridor is likely to have adifferent set of requirements for its implementation. The next section will discuss the differing

implementation requirements at the national level and for the Kalimantan and Bali- NusaTenggarra Corridors. Below shows the differing perceived opportunities and barriers toimplementation derived from the three rounds of interviews carried out by the Polling Center inJakarta, Kalimantan and Lombok.

Figure 10 - Perceived Opportunities at the National Level

Figure 11 - Perceived Barriers to Implementation at the National Level

Lack of Planning

Lack of Coordination

andSocialisaiton

UnderpreparedHuman

Resources

Unclear SpatialPlans

LimitedFlexibility for

the PrivateSector

Lack of Coordination

BetweenGovernmentand Private

Sector

OverlappingRegulations

Increased Levels of Investments

DevelopedInfrastructure

EnvrionmentalProtection

Improvements in theSocial Economy



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Figure 12 - Perceived Opportunities in the Kalimantan Corridor

Figure 13 - Perceived Barriers to Implementing the Kalimantan Corridor

Lack of Syncronisation

between Regulationsat the Central and

Regional Level

EnvironmentalDamage

Risk of Corruption

UnderdevelopedInfrastructure

Lack of FinancingPotential Resistance

from the LocalCommunity

Lack of ConnectivityWithin the Four

Regions of Kalimantan

Indigenous Rights areNot Taken into

Account

Too Much Relianceon Unrenewable

Resources

Investment inInfrastructure

Increased ValueAdded Products

Increased Capacityof HumanResources

Job CreationReduction of

Regional Disparities



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Figure 14 - Barriers in the Kalimantan Corridor broken down by frequency of mention:

Figure 15 - Perceived Opportunities in the Bali- Nusa Tenggara Corridor

IncreasedInvestor

RelationsInvestment inInfrastructure

Increase inTourism and

Food Security

Job CreationIncrease in

MicroEntrepeneurism

GrowthPotential of

Marine Sector

Mentioned by Government, Private Sector and CivilSociety:

Lack of SocialisationRisk of Corruption

Mentioned by Government and Private Sector:Lack of Syncronisation between Regulations at

the Central and Regional LevelUnderprepared Local Government

Mentioned by Private Sector and CivilSociety:

Potential Conflict with IndigenousGroups

Mentioned by Government andCivil Society:

Underdeveloped InfrastructureUnderdeveloped Human Resources

Mentioned by Government Only:Unequal Funding

betweenthe

Regions



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Figure 16 - Perceived Barriers to Implementing the Bali- Nusa Tenggara Corridor

Figure 17 - Barriers in the Bali- Nusa Tenggara Corridor broken down by frequency of

mention:

Mentioned by Government, Private Sector and CivilSociety:

Underdeveloped Infrastructure

Underdeveloped Human Resources

Mentioned by Government and Private Sector:Low Awareness of the MP3EI

Unsupportive RegulationLack of Incentives for Private Investment

Mentioned by Private Sector and CivilSociety:

Imcomplete Operational Procedures

Mentioned Only by Government:Lack of Technology

Small Regional Allocation Fund

Mentioned Only by Civil Society:Cultural and Local

Customs which couldclash with the Tourism Sector

Low Awareness of the MP3EI

UnsupportiveRegulation

Small RegionalAllocation Fund

UnderdevelopedInfrastructure

UnderdevelopedHuman Resources

Lack of Technology

Cultural and LocalCustoms which

could Clash with theTourism Sector

IncompleteOperationalProcedures

Lack of Incentivesfor PrivateInvestment



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Implementation Requirements and Recommendations for the MP3EI

During the National Level Seminar on March 14th, Dr. Prasetijono MJ, M.A, Deputy of Economy, National Development Planning, BAPPENAS stated that he views the MP3EI as a

‘living document that requires inputs and even criticism.’ As a living document, plans for implementing the MP3EI are not completely resolute. The following section will analyse a planfor implementing the MP3EI at the national level as well as looking specifically at therequirements for the Kalimantan and Bali- Nusa Tenggara Corridors. Firstly, this section willlook at the international experience of implementing economic corridors and lessons will bedrawn for the Indonesia experience. Roles of stakeholders and levels of preparedness will also beassessed before making final recommendations.

International Experience of Implementing Economic Corridors

A Closer Look on East-West Economic

Corridor of Greater Mekong Sub-region(GMS): Turning Infrastructure Corridors intoEconomic Corridors

A decade after the launch of the East-WestEconomic Corridor (EWEC), the Corridor hasestablished many of the targeted infrastructural benchmarks. A holistic approach has beenadopted in developing a cost-effective strategyof placing an efficient transport system for themovement of goods and people in the sub-

region while improving telecommunications,energy infrastructure, tourism as well as acontributory policy and regulatory environmentthat encouraged private sector involvement anddevelopment. Twelve flagship projects areclassified under two categories of transport andother infrastructure and are managed by variousworking groups.

Stages of EWEC Implementation Stage 1: EWEC Transport Corridor

Similar to the MP3EI, the initial stage of theEWEC has focused on the establishment andimprovement of transport facilities andinfrastructure to efficiently move goods, services, and people across country borders.Improvement on such was considered to be important in placing linkages along the corridor.Connecting the physically linking areas in the eastern portion of the corridor has been achievedwith the assistance from the ADB, JICA, and the Japan Bank for International Cooperation

Box 2 : EWEC Flagship Projects

A. Core Transport(1) East West Transport Corridor

(2) Water Transport Development

(3) Railway Development

(4) Air Transport Development

(5) Cross-border facilitation in the

movement of people and goods

(6) Human resource development for the

transport sector

B. Other Infrastructure

(1) Development of electric power grid(2) Promotion of regional energy

cooperation arrangements

(3) Telecommunications backbone

development

(4) Tourism development

(5) Economic corridor Initiatives

(6) Initiatives of the Ministry of Economy,

Trade and Industry (ASEAN-METI),

Economic and Industrial Cooperation

Committee (AMEICC), and WorkingGroups on West-East Corridor

Development



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(JBIC). In the western portion, plans are outlined for the completion of the Mawlamyine toMyawaddy section of the highway with the support from Government of Thailand. TechnicalCooperation for the EWEC transport corridor has been provided much by the ADB whilst JBIChas been the dominant source of financing the infrastructure construction. JBIC has accounted

for about 80% or almost $900 million of the EWEC’s overall transport infrastructure.

Stage 2: EWEC Economic Corridor The second stage of the corridor’s development focused on poverty reduction, development of rural and border areas, improvements on the wages of the low income and vulnerable groups, promotion of tourism along the corridor, and provision of jobs for women. These projects are being financed by international, regional, bilateral donors, development partners but ADB is inthe forefront of development financing. Technical support however is being supported by boththe ADB and Japan’s ERIA for the development of special economic zones (SEZs) along thecorridor. Tourism initiatives are also active with the Mekong Tourism Development Project(MTDP) and the East-West Economic Corridor Tourism Project.

Development ChallengesAlthough the major infrastructure components of the EWEC have now been realised and that thedevelopment of EWEC has involved much progress in facilitating trade, improving networks of transportation, and promoting private and tourism industries, consensus is still lacking amonggovernment, development partner officials, private sector, and other stakeholders on convertingthe transport corridor into an economic corridor 46. With this, Indonesia can take advantage tolearn from and avoid the hurdles in the EWEC economic corridor transformation. The slow paceof transforming the transport corridor into a fully-fledged economic corridor is attributable tosome critical issues:

1. Cross-border investment liberalisation regulations2. Agribusiness development3. Financial schemes for business operations along corridor 4. Infrastructural improvements in gateway nodes5. Secondary roads to let the rural communities pass through the main artery of economic

corridor 6. Services on business development for small and medium enterprises along the poorer

areas of the corridor 7. Management of tourism initiatives and projects at both the national level and across the

EWEC countries8. Infrastructural services and road access to tourist spots

9.

Model or benchmarks to assess the performance and progress in achieving the goals thathave been established for the EWEC.

46 Asian Development Bank, 2010, “Strategy and Action Plan for the Greater Mekong Sub-region East-West

Economic Corridor”



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Accomplishments and Lessons from the EWEC ImplementationThe major accomplishments of the initial strategy and action plan outlined in the 2001 Pre-Investment Study are accountable to those that have been covered by the Cross Border TradeAgreement (CBTA), the GMS tourism sector strategy, and the GMS Business Forum. To date,

only about one-sixth of the policy, project, programme, and institutional projects have beenimplemented and about one-sixth have been partially implemented or are in the process of implementation.

A number of cross-border investment liberalisation policies, programmes, and agribusiness projects; information systems on trade flows and cross border-investments; financial schemes tosupport business operations along the corridor; port improvements in the gateway nodes; and business development services for micro and small-sized businesses along the corridor areas areamongst the initiatives that have not been implemented.

The following are the lessons learned from the EWEC 2001 Strategy and Action plan47:

1. Rather than implementing wide-ranging initiatives, a few targeted initiatives comprisingof well-defined areas are more likely to be easily implemented.

2. Successful realisation of cross-border investments was hindered by problems in (i) goodgovernance and corruption, (ii) existence of adequate infrastructure, (iii) clear andresponsive policies on foreign investment, (iv) the establishment of well-functioningindustrial zones, (v) the integration of small and medium enterprises into value chainactivities along the poorer areas of the EWEC. Moreover, activities related to privatesector promotion were carried out by the GMS Business Forum.

3. There are remaining difficulties in evaluating the EWEC performance in terms of itsimpact on cross-border economic activity due to data limitations and lack of transparency. Moreover, there is an absence of benchmarks and standards for assessingthe performance. As such, it remains challenging for member countries to developownership, oversight, and accountability on the progress of turning the EWEC into aneconomic corridor.

4. The EWEC developments have strong linkages to National Development Plans andprovincial development strategies of all member countries. It is viewed as a key strategyfor national and regional development. This ownership however needs to be integrated

into the new strategy and action plan both in terms of how implementing mechanisms areformed and in terms of establishing benchmarks and performance measures.

47 Asian Development Bank, 2010, “Strategy and Action Plan for the Greater Mekong Sub-region East-West

Economic Corridor”



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Figure 18 - EWEC Linkages to National Development Plans

Source: Asian Development Bank. 2010. Strategy and Action Plan for the Greater Mekong Sub-region East-West

Economic Corridor

5. Reduction of border costs is important as much as developing EWEC physicalinfrastructure because connecting inter-country provinces with highways is not sufficientto facilitate the movement of goods and people. To maximise the benefits of infrastructural developments, reductions in border costs must take place to fully affect the potential impact on the geographic distribution of populations, raise income levels, and boost development of industries.

6. Creating partnerships can be challenging as opportunity gaps still exist (i) between publicand private sectors, (ii) in establishing economic activities across borders, (iii) in valuechains, (iv) and among development partners and NGOs.

7. Formulating comprehensive plans and roadmaps is still not a mainstream practice that iswhy there is a need for improving a holistic master plan approach for every sector andacross sectors (i.e. linking support sectors with leading sectors).

8. The lack of adequate statistical information made it difficult to assess progress and

achievements of the EWEC over the last ten years on the transformation of the transportcorridor into an economic corridor. Investment and cross-border trade data are difficult toget hold of. Where available, it would definitely identify bottlenecks to further progressand improve monitoring and evaluation of achievements. An effective monitoring andevaluation framework for the EWEC containing benchmarks and quantifiable targets isgreatly needed and must be provided on a yearly basis by the various sector workinggroups. Impact indicators must also be available as part of the evaluation reports andmust be submitted to the ECF and the GMS leadership.



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The Indonesia-Malaysia-Thailand Growth Triangle

Established in 1993, the Indonesia-Malaysia-ThailandGrowth Triangle (IMT-GT) sub-regional economic

cooperation aims to accelerate the economictransformation of the member states and provinces inthe three countries by maximising their complementarities and comparative advantages. TheIMT-GT Roadmap set the vision of “a seamless, progressive, prosperous, and peaceful sub-region withimproved quality of life.” The R oadmap comprises of both a framework and an action plan to steer economic cooperation over a five-year period. It also provided five strategic thrusts, namely: (i) to facilitateand promote intra- and inter-IMT-GT trade and

investment; (ii) promote the growth of agriculture,agro-industry and tourism; (iii) strengtheninfrastructure linkages and support to the integration

of the IMT-GT sub-region; (iv) develop human

resources and skills competencies, enhance mobility

of labour, and strengthen environment and natural resource management; and (v) strengtheninstitutional arrangements and mechanisms for cooperation, including public private sector

collaboration, participation of stakeholders at the local level, and the mobilisation of support

from development partners.

Projects and activities under the Roadmap are classified under clusters, namely, (i) a policy and

regulatory anchor, which is aimed at providing a sound policy and regulatory environment to private sector activities in the IMT-GT region; (ii) and an anchor of major IMT-GT connectivitycorridors from which development will spread out to neighboring areas through transport andeconomic linkages.

Overall Assessment of IMT-GTIn the past 15 years, the IMT-GT has achieved progress in terms of maintaining the economicexchanges and commercial ties among the participating states and provinces. Because of the private sector’s active participation and well-functioning business networks, trade andinvestment have boosted in the sub-region.

The IMT-GT Roadmap has clearly outlined a long term vision, five strategic thrusts, 37 flagship projects and more than 50 measures, programs and projects. However, there is a weak linkage between strategic thrusts and actual projects. The strategic thrusts have not been converted into amass of interrelated projects that could make a considerable impact on the IMT-GT goals since itis often argued that there are too many flagship programmes which are not well-conceived.

There are fundamental weaknesses in structures, capacities and processes of IMT-GTcooperation reflected in its lack of capacity for program and project formulation. One obvious

Box 3 IMT-GT Five Connectivity

Corridors

a) Extended Songkhla-Penang-MedanCorridor (Nakhon Si Thammarat – Phattalung – Songkhla – Yala – Pattani – Penang – Medan); b) Straits of Melaka Corridor (covering thewestern coastal belt from Trang inSouthern Thailand to Melaka in Peninsular Malaysia);c) Banda Aceh-Medan-Pekanbaru-Palembang Economic Corridor (a roadcorridor running south to north throughSumatera);d) Dumai-Melaka Economic Corridor (amaritime corridor linking Sumatera andPeninsular Malaysia); ande) Ranong-Phuket-Aceh



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problem is the lack of comprehensive studies in other sectors of cooperation that could haveidentified development gaps to serve as a basis for making programs and projects.Comprehensive and analytical studies have only been done on the connectivity corridors,maritime transport, logistics development, and opportunities for the transport sector. Project

proposals evaluated and approved at the working groups are largely randomly considered,making the working groups to lack direction and control. Moreover, many recommendationsfrom the analytical studies on connectivity corridors have not been mainstreamed into both theGovernment and Joint Business Councils (JBC) groups. There is also a weakness in secretariatsupport both at the national and sub-regional levels that worsen the difficulty of effective projectidentification and formulation.

Lessons from the IMT-GT Implementation

1. The preliminary step for making the Action Plan Matrix more efficient has beenconducted but the improvement of Action Plans has to be enforced more intensively.

Specifically, the APM needs to be further developed and must be well thought-out andlogically ordered with strategic projects in order to accomplish sector goals. Moreover,clearer information on the scope and benefits of the projects is needed to assess the projects’ results and impact more accurately.

2. The sector strategies that have been assumed by the Working Groups should bemaintained to guide further work on the Action Plan Matrix. Working Groups should begiven the chance to expand their appreciation and ownership of the sector strategies as afoundation for project formulation by way of broad-based and inclusive sector forums.These forums should produce project concepts that can lead to a more disciplined andwell-informed process for devising projects to be included in the blueprint.

3. Detailed and well-structured financial schemes and implementation plans are necessary to

guarantee effective and efficient implementation of projects. A project follow throughmechanism must take in place to allow keen monitoring of all the aspects of projectimplementation – inputs, through-puts and outputs – and to assess issues and constraintsthat hinder smooth project implementation. To facilitate project coordination andmonitoring properly, an electronic based system must be set up for updating, monitoring,and providing access to information on the APM.

4. An inclusive, well-informed, detailed, and deliberate connectivity corridor action planmust be in place and must include its software and hardware components. It should havea clear time frame, realistic goals, and most importantly a detailed financial plan. The process of formulating the corresponding action plans should involve the Governmentagencies both at the national and regional level as well as the private sector groups (i.e.

SMEs, freight forwarders, banks) and future development partners.



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5. A new business model for the IMT-GT must be adopted different from that of ASEAN.The model should have the following features,namely, (i) a public-private sector component inall phases of planning, programming and

implementation; (ii) a distinct separation of the program/project formulation and implementationfunctions into working entities with clear accountabilities; (iii) wide involvement of keystakeholders (including the local governments) inthese working entities; (iv) a project-basedorganization of working units rather than sector- based; (v) a professionally-run regionalsecretariat.

The Implications of International Experience for the

MP3EI

Experiences of economic corridor development from theEWEC and IMT-GT offer some lessons for the MP3EI.The first is on the importance of model or benchmarks inassessing the implementation progress that have beenestablished in the MP3EI. Second is on the role of aneffective regulatory framework to facilitate the movementof goods and people across economic growth centers andof the capacity to implement and enforce it. Third is onthe usefulness of adequate statistical information and an

evaluation framework to assess the achievements for every implementation phase. Impact indicators must also be available as part of the evaluation reports and must besubmitted to the main implementing body of the MP3EI.Fourth, detailed and well-structure financial schemes andimplementation plans are necessary to guarantee effectiveand efficient implementation of initiatives. Lastly, anAction Plan Matrix (APM) must be in place and has to becarried forward more intensively. The APM has to bewell-thought out, logically sequenced, and must includethe strategic projects to achieve sector goals.

Verbatim Quotes from the Polling Center inresponse to the question on the Main Driversof the MP3EI.

“..The private sector. The reason bring thatthe government does not have the funds. It is

true that the policy and decision maker is the government, but the investors are the private sector, and so the government is merely the

facilitator …” Private Sector, Kalimantan Seminar

“.. Maybe since I come from private sector Itend to choose more neutral individuals, I willnot give it to the local government but to thelocal community leaders instead, or in the

private sector, or maybe when we talk abouneutral academicians, it should really beobvious that this group is clearly impartial

and possesses a strong character ..”Private Sector, Kalimantan Seminar

“…S pecifically in the local areas theinformation should focus on the regional

government, the center of information shouldbe there, in this case is the Bappeda. In myopinion there should be some kind of MP3EI

center at the provincial level therefore, thereis no need to go to the central. Only one

person is required to go to the central, which should just be the Bappeda.”Private Sector, Kalimantan Seminar

“.. Actually it is the role of local governmentThe central government is responsible for

strategic policies and the regional government

should be responsible for what is applicable ineach region..”Government Official, Kalimantan Seminar

“..Civil society, entrepreneurs and the private

sector. They are the implementers, and thelocal government should facilitate that..”Private Sector, Kalimantan Seminar

“..I believe all have important roles, if one of

them does not play its role, this will alsoinfluence the speed of this program..”Government Official, Kalimantan Seminar



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Roles of Stakeholders in the Implementation of the MP3EI

Data collected during the interviews shows that overall, the government was seen to play the roleof facilitator that is by creating and maintaining the rules and regulations which will shape the

progress of the policy. The private sector was seen as the engine, since the majority of theinvestment needed to support the policy is expected to come from private investment. Civilsociety organisations were seen to be a third party, to assure that other actors maintain their responsibilities as well as to represent and encourage community empowerment, such asKalimantan’s many indigenous people and endangered species.

However, verbatim quotes from the Polling Center on the perceptions on main driver for theimplementation of the MP3EI show a mix of responses from stakeholders below the surface of the overall theme. This lack of a clear knowledge of stakeholder roles in implementation is surely a barrier toa smooth process of implementation. A lack of clear cut

roles may lead to a duplication of undertaking of tasks or a delay in targets being met due to one set of stakeholdersrelying on the impetus of others.

An important point that has already risen in the barrierssection on financing and private sector investmentdiscussed the mismatch between the perceived roles of the private sector and government. This is especially poignant due to the fact that long term trust andcollaboration is necessary in building foundations for increased private investment in the MP3EI. Many of the

government officials both at the regional and nationallevel saw the private sector as the main driver, whereas atthe same time many members of the private sector sawthe government as the central force for implementation.The government cannot expect to wait for investments toroll in before it takes the lead in ensuring targets for basicinfrastructure are met, regulations are reviewed and theinvestment climate is improved.

Continued Verbatim Quotes from thePolling Center in response to thequestion on the Main Drivers of theMP3EI.

“...Trust it to locals, the central is onlythe coordinator, not the decisionmaker..”

Civil Society, Kalimantan Seminar

“..Bappeda and also local KADIN. I

completely agree on the involvement of 3 main groups of actors, first the

government, the private sector and civil

society. The civil society has a lot of initiatives in community

empowerment …”Civil Society, Kalimantan Seminar

“…it must indeed be the government that should run the program because it

is within the context of the state,including the investments, those whoregulate investments should have ahuge authority in managing this project …” Civil Society, Kalimantan Seminar



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Current Structure of the KP3EI

The Committee on Economic Development Acceleration and Expansion of Indonesia 2011-2025(abbreviated KP3EI) is an institution which was established by the President of the Republic of

Indonesia on May 20, 2011 to coordinate the implementation of MP3EI. The institute isestablished under Article 4 of Presidential Decree No. 32 Year 2011. The tasks of the KP3EItasks are as follows:

to coordinate the planning and implementation MP3EI,

to monitor and evaluate the implementation MP3EI,

to outline the steps and policies in the context of solving problems and barriers toimplementation MP3EI.

The structure of the MP3EI implementation committee consists of an Implementation Team,Working Team, and a dedicated and professional Secretariat with the following explanations:

1. The Implementation Team consists of: Ministers, the Chairman of Non MinisterialInstitutions, and representative agencies that shall contribute to the implementation of MP3EI. The Implementation Team is responsible for providing general guidance,approving strategic decisions, and solving strategic issues which may arise during theimplementation of MP3EI.

2. The Working Team shall consist of high ranking officials (echelon 1), and key officialsfrom relevant agencies who will be involved in the implementation of MP3EI action plans. The Working Team is responsible for coordinating the implementation of investment projects and infrastructure projects. This team will act in collaboration with

relevant agencies, and is also responsible for solving inter-ministerial problems andensuring government support for the implementation of MP3EI.

3. The Secretariat is a dedicated and full time supporting team that is responsible for developing a monitoring and coordinating system for progress of MP3EI’simplementation. The secretariat will actively support the Implementation Team andWorking Team by providing them with a clear analysis and technical proposal toovercome the problems arising from daily monitoring.48 An organisational chart to showthe national KP3EI structure can be found in the Annex of this paper.

The fact that the KP3EI is chaired by the President of the Republic of Indonesia and the KP3EISecretariat is chaired by the Coordinating Minister for Economic Affairs of the Republic of Indonesia shows that the national government has shown leadership and responsibility for theimplementation of the MP3EI.

48 Yahoo Group on the KP3EI



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The limitation of the current system is that the majority of stakeholders involved both and thenational and regional level are mainly government officials. For instance, the member list for theBali- Nusa Tenggara MP3EI Working Group below shows that out of the 17 members, 9 arefrom government institutions, and the rest are prominent stakeholders in the private sector. As

such, there is a lack on inputs from civil society at large.

Members of the Bali- Nusa Tenggara MP3EI Working Group

1. Deputy for Coordination of Macroeconomics and Finance, Coordinating Ministry for Economic Affairs2. Deputy Head of Development Performance Evaluation, National Development PlanningAgency3. Director General of Tourism Destination Development, Ministry of Culture and Tourism4. Director General of Animal Husbandry and Animal Health, Ministry of Agriculture5. Director General of Fisheries, Ministry of Maritime Affairs and Fisheries

6. Director General of Foreign Trade, Ministry of Commerce7. Director General of Water Resources, Ministry of Public Works8. Expert Staff and Institutional Law, Coordinating Ministry for Economic Affairs9. Christianto Wibisono, one of Indonesia’s leading economists and commentators- foundingdirector of Global Nexus Institute, a think-tank advising government on geopolitical andeconomic issues.10. Juan Permata Adoe, Deputy Chairman for Fisheries and Farming, KADIN, Jakarta11. Johnny Darmawan, President Director of PT Toyota Astra Motor (TAM) and Chairman of the Association of Indonesian Automotive Industries (Gaikindo)12. Gede Suwardana Linggih13. Barry Djadid, Head of KADIN, Lombok

14. Paul Lyanto, Council Member of the Provincial Government of Nusa Tenggara Timur.15. Saharudin Didu16. Meidya Amoraldham17. Ahmad Bakri Putra49

The above information on the KP3EI regional working groups is not easily available to the public. One recommendation would be to increase transparency on information such as this sothat any interested stakeholders can easily access up to date information. During a Polling Center interview, one stakeholder from the national government suggested the formation of a regionalKP3EI Working Group as part of the implementation process, thereby implying that they wereunaware of the already existing Working Groups in each Corridor. Furthermore, it is advised that

these Working Groups also open up to larger breadth of stakeholders as in line with the ‘NotBusiness As Usual’ mind-set which the MP3EI seeks to create by increasing collaboration andinputs from a variety of stakeholders.

49 KP3EI Yahoo Groups



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Level of Preparedness

Since socialisation and awareness of the roles of stakeholders in implementing is limited, itfollows that stakeholders are likely to be underprepared in playing an active role in

implementation.

There seems to be a mismatch of communication between thenational and regional governments. Awareness of the MP3EIwas found to be much higher at the national level, and thusgovernment officials on average felt that they were preparedto implement the policy.

In the government category, all respondents in Polling Center interviews felt ready to implement the MP3EI butrespondents at the regional level stated that they felt

inadequately prepared. A good level of preparedness wasindicated by the commencement of intensive meetings withwork groups. Despite this, there were also some respondentsthat stated that the government, at both the central andregional levels, was unprepared and the same held true for the private sector.

Looking at the experience of the Indonesia- Malaysia-Thailand Growth Triangle shows that time was easily spenton studies and implementation plans for connectivitycorridors, maritime transport, logistics development and

opportunities for the transport sector, but what wassignificantly lacking was a similar dedicated plan to a studyon working practices for the implementation.

To formulate an implementation institution with focus only on implementing the setdevelopment activities under the MP3EI is only half the story. At the same, the KP3EISecretariat the Working Groups at all levels should be well considered in its membership, andgood management working practices should be laid at the start and be adhered to.

Sequencing

Barriers to implementing the MP3EI at the national level compared to the Kalimantan and Bali- Nusa Tenggara Corridors have shown to be different from one another. As such,recommendations for the two regional corridors are different from each other as well as differentfrom the general recommendations for the national level.

This indicates that each Corridor will be unique in its implementation. Indeed, the MP3EI statesthat each corridor will be unique in that each has its own theme based on the comparative

Verbatim Quotes from thePolling Center in response to thequestion on the perceived levelof stakeholder preparedness toimplement the MP3EI.

“…based upon what I have seen so far, with the onset of intensive

meetings with corridor work groups, everyone acknowledgesthe intentions of MP3EI are

already good…” Government Official, Jakarta

“ For the government, I have to say it is low. And Indonesia’sbusiness is not ready to compete

with the outside world” Private Sector, Jakarta

” ..actually, both the central and regional governments arewholly unprepared and this

extends to their affiliates...” Civil society, Jakarta



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advantage of that region. Furthermore, implementation relies on a number of factors such aslevels of infrastructure, human resources, institutional capacity, amongst others which all varyfrom region to region. As such, it is likely that the implementation experiences from oneCorridor cannot be copied to another. This suggests then, that the idea of using a pilot corridor

should not be undertaken, but instead all six corridors be implemented simultaneously.Implementing the first phase of the MP3EI should occur at the same time as increased researchand planning to develop human resources, invest in science and technology, developing basicinfrastructure as well as a regulatory and institutional reform.

Similar to the East- West Economic Corridor of the Greater Mekong Delta Sub- Region, theMP3EI has dedicated the first phase of the implementation process from 2011 to 2015 as solelyin investing infrastructure. The purpose behind this is to increase the inter-corridor connectivityand set basic foundations for the second phase.

The EW Economic Corridor found relative success in the infrastructure phase, and significant

increased trade and investment flows were increased as a result. However, difficulty was foundin the move from an infrastructure corridor to an economic corridor.

For the second phase of the MP3EI, attention needs to move further down to the regional level.After infrastructure corridors are established, the regional government should have a better awareness and ability to fulfil its roles. Increased responsibility at the regional level for implementing MP3EI would serve as a faster method of implementation rather than at thenational level and each Corridor would be able to adapt to its local situation easily. The MP3EIshould not be bound to a one size fits all policy, but the regions should have the capacity toimplement the policy according to the different needs and abilities of each corridor.

Implementation Requirements for the National Corridor

The MP3EI needs to contain a number of essential components, the most important being:

A stable macroeconomic framework which would deliver low interest rates, low inflationand incentives for higher savings and investment

A programme of infrastructural development which would improve the investmentclimate and produce feasible incentives for private investment in the twenty two maineconomic activities

An industrial policy designed to promote investment in key industries, using a PPP modelwhere appropriate

Developing Indonesia’s human resources and technological adaptation so as to allowmoving towards new frontier technologies as the composition of FDI changes and new products are introduced into the existing supply chains.

An architecture of economic growth and social stability augmenting institutions: legaland regulatory, planning and budgeting, financial and banking, monitoring and qualitycontrol institutions in important sectors such as education and transport, for example.



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Macroeconomic stability, infrastructure development, rising public and private investment,reform of the institutional architecture and human capital development are all essentialcomponents in the economic strategy of the MP3EI. As such, parameters for economic

diversification need to be identified simultaneously rather than sequentially.

Recommendations for the Implementation of the MP3EI at the National Level

Socialisation needs to be improved, since government officials at the national leveloverall had a much better understanding on the meaning, opportunities and requirementsfor implementing the MP3EI as compared to the private sector and civil society.

A clear set of expectations from different groups of stakeholders needs to be established,as now there is cross over in expectations of different stakeholders- particularly between

the private sector and government officials. Increased available information for the private sector as well as inclusive socialisation is the first steps to establish a long termworking relationship between the private sector and government to implement theMP3EI.

A regulatory review to ensure that the MP3EI can be supported by laws and regulationswhich are streamlined through the regional and national level.

MP3EI Working Units need to be established which coordinate regularly with thenational level. These groups should involve a breadth of stakeholders and their targetsand quarterly progress should be made available as public information.

Improving basic infrastructure should be seen as a national government priority in order to attract private investment in commercial infrastructure.

An Action Plan needs to be developed looking at the short and long term needs of developing human resources in each of the six corridors. At the moment, it is not clear inthe MP3EI where funding is to be sourced to establish training centres and other resources develop Indonesia’s man power. The MP3EI document lays out a breakdownfor the infrastructure budget, but there is a lack of a breakdown of a budget for humanresource development.

An Action Plan needs to be established on the strategies when moving from aninfrastructure to an economic corridor learning from the international experience.

The national PPP framework needs to be reviewed, projects need to synergised betweenthe national and regional level, with only feasible projects which are ready to commenceadvertised. The President also needs to take the lead at the national figurehead for thedevelopment of PPPs in Indonesia.



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A review of the financing budgeted for the eastern parts of Indonesia needs to be carriedout as eliminating regional disparities are a priority for the MP3EI but yet there is a lack of financing in eastern Indonesia which acts as a barrier to growth and also privateinvestment.

Different requirements are needed throughout the Six Corridors of the MP3EI and thiseach corridor must be implemented simultaneously and lessons on implementation must be continuously shared between the Six Corridors.

Implementation Recommendations in the Kalimantan Corridor

There is a need to better socialise the policy. Most of the regional government wereaware of the MP3EI, but there is better knowledge at the national level. It is important to

involve the private sector if investment is required from them. Civil society also needs to be involved in order to understand and support the development.

Stakeholders who were consulted about the implementation of the Kalimantan Corridor were wearier than their Bali- Nusa Tenggara counterparts about the fundamentaleconomic activities proposed in the MP3EI. Many were concerned that the MP3EI in itscurrent state does not take into account environmental damage caused by the policies andis not in line with the President’s target to reduce carbon emissions by 26% by 2025. Assuch, further research needs to be developed on how to align environmental sustainabilitywith economic development in this Corridor.

Investment in infrastructure is needed in Kalimantan and the MP3EI hopes to better connect Kalimantan’s four provinces. It is important that connectivity unites Kalimantanas one Corridor as at the moment there is a significant lack of a connection and sharing of information between the four provinces.

Kalimantan’s Indigenous peoples’ rights must be taken into account especially regardingland rights.

The MP3EI establishes that specific human resource skills are needed for theestablishment of the Kalimantan Corridor- especially with regards to the fact that theCorridor is centred on promoting both specialist and management training is needed for

the oil and gas, coal, palm oil and bauxite sectors including specialists in deep-seaexploration, moving towards clean coal technologies and aluminium design, for example.The MP3EI, however, does not specifically lay out requirements and plans todevelopment human resources for the timber and steel sectors. It is not clear where suchtraining centres will be, who will administer them.



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A regional MP3EI institution must be set up in the Corridor in order for stakeholders tomeet, and to act as a hub for accessing information for potential investors and civilsociety.

Implementation Recommendations for the Bali- Nusa Tenggara Corridor

There was a positive reaction from stakeholders of the furthering the tourism, animalhusbandry and fisheries sectors in the Corridor. However, socialisation in this Corridor islacking, so the first step would be to build upon this perceived goodwill fromstakeholders.

As the Bali- Nusa Tenggara Corridor brings together a set of islands rather than one landmass, as in the Kalimantan Corridor, implementing the first stages of connectivity andinfrastructure is a large task.

In this Corridor, stakeholders throughout this project have debated over whether tourismshould be seen as the dominant sector in this Corridor and that one should be careful of viewing tourism as a renewable resource. Mr. Bagus Sudibyo from the Bali TourismBoard at the Lombok Seminar told the story of Bali’s tourism industry. As a result of theglobal recession and of the Bali bombings in 2002 and 2005, tourism in Bali droppeddramatically, showing how relying on one dominant sector can be very harmful. Onemain barrier mentioned in developing the tourism sector in this Corridor was the tension between groups who have seen the growth of tourism, especially in Bali, as ‘sinful’ anddetrimental to the values and customs of the local community. Promoting tourism further in Bali as well as in Nusa Tenggara Timur means that local communities must be

involved in order to avoid a clash.

There are disincentives to investing in the fishery and animal husbandry sectors, such asoverlapping regulations, lack of fiscal incentives such as tax breaks, and poor infrastructure. These should be a priority in order to attract the private sector. Basicinfrastructure needs to be prioritised by the regional government before private sector investment should be expected.

There is a need to better engage the private sector from the outset of policy making toensure the long term relationships which are needed since such large amounts of investment are required from the private sector in order to implement the MP3EI. The

private sector needs to be able to access up to date investment data and availableinvestment opportunities. PPP projects also need to be uniform throughout all levels of government.

An MP3EI institution needs to be established in the Corridor with easy access for stakeholders to meet and access up to date information on the implementation of theMP3EI.



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Conclusions

•The vast majority of people consulted as part of this project had belief that the MP3EI can be sucessful.

•Moreover, stakeholders from all categories wanted to be kept aware of the progress of this policy, indicating that stakeholders were not positive but want to play an active role in the implementation.

•However, a large number of stakeholders were aware of the manyimplementation barriers to this policy.

1. Build on Goodwill

•The positive reaction from stakeholders was limited by the fact thatawareness amongst stakeholders, especially in the regions, is low.

•Stakeholders agreed that regular bulletins were the best way to keepthem informed.

•Participants at the Kalimantan Semianar also wished for an MP3EICorrdination Office in each region. These institutions could mean easyaccess to updates on laws and regulations and investment opportuntiesfor the private sector, as well as provinding information for the local

comminuty. Such offices could also house regular meetings withstakeholders so as to achieve the 'Not Business as Usual' collaborationfrom stakeholders.

2. Build on Awareness

•There is no one central source of information on the implementaiton of the MP3EI, and as such stakeholders can find it confusing to findinformation. This also acts as a disincentive to invest in the MP3EI.

•An MP3EI website needs to be created so that people can follow theimplementation of the policy. The private sector would also be able toaccess information on rules and regulations on investing in particular economic activities per corridor.

•An MP3EI website as a souce of information should be managed bythe KP3EI secretariat the the national level. The KP3EI WorkingGroups at the regional levels should send quartely implementation

reports to the MP3EI Secretariat which includes targets met, targets for the next quarter and lessons learnt. Such information should be made public via the MP3EI website so all stakeholders can accessinformation. This is also key in the sharing of data between Corridors.

3. Virtual Sectretary

•This paper has shown that the current KP3EI model for theimplementation of the MP3EI mainly involves government officialsand the private sector. It has been voiced by many stakeholders thatmembers of civil society organisaitons must too be included in thedecisions in implementation. Feedback from internal meetings of theKP3EI must also be socialised so that larger number of stakeholders areinformed and invovled. Essentially, the MP3EI policy is for the benefitof the entire population of Indonesia, and as such members of the public , universities, NGOs etc. should be considered relevant

stakeholders.

3. InvolveStakeholders

•All existing regulatory frameworks must be evaluated to attractinvestors. The national government must carefully monitor regulationand bureaucracy so that all programmes and projects in the MP3EI willrun smoothly. The government should also ensure that obstacles toland acquisition must be removed and that tax rules are no longer burdensome to investors.

•The lack of clarity in terms of explaining when or how nationalcompetition needs to be maintained or the limitations of understandingthe strategic value of a particular business may cause variousinterpretations of this stipulation or provision. Since multipleinterpretations of this provision may lead to uncertainty and ambiguity,the Indonesian government should clarify these provisions to

effectively implement the goals of the Tax Holiday Regulation.

4. Regulatory Reform



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•Stonger political will is needed behind the MP3EI in order to ensure itssuccess. The President needs to be the voice of the MP3EI bothdomestically and internationally.

•Work in battling against corruption needs to be maintained.

•The connection between Corridors needs to be improved and annualworking groups need to take place at the national level with theattendance of all KP3EI Working Groups so that lessons learnt can be

shared. Such increased cohesion should increase transpareny andimprove the breadth of involved stakeholders.

6. InstitutionalReform

•BKPM at the national level need to host international workshops oninvesting in Indonesia.

•PPPs need to be synergised between the regional and national level,and only projects which are fully feasbile should be proposed.

•The Indonesian President needs to be the act as the main figurehead for the MP3EI and for all investment required for its implementation.

7. Actively EncouragePrivate Investment

•This report has shown that the Kalimantan and Bali- Nusa TenggaraCorridors have different implementation requirements. Each Corridor is inherently unique and thus the use of a pilot corridor may prove

ineffective.•The implementation of all six economic corridors should occur simultaneously.

•Preparation for regulatory and institutional reform, developinginfrastructure, improving science and technology as well as humanresources should all be developed at the same time.

8. Sequencing

•Basic infrastructure needs to be developed as a priority at the regionallevel. To work on reducing regional disparities special attention must be given to islands in eastern Indonesia. Reviewing the budgetallocated towards areas with underdevloped infrastrucutre needs tooccur as it is unlikely private sector investment will be attracted toregions with lower levels of basic infrastructure.

9. Infrastructure

•Mapping out the manpower planning needs for Indonesia will be atremendous challenging exercise as it requires detailed research in allsectors of economic expansion, strong time series data, and substantialmethodological capacity. In addition, projections of labour andeducation requirements based from project outputs are subject tovarious possibilities in production methods and labour market demand.This is going to be a complicated process that cannot be done alone byMinistry of National Education (MONE) as it requires the cooperationof other entities such as Bappenas and the Minstry of Finance todevelop more accurate forecasts. Moreover, specific forecasts for theconditions of each one of the provinces of economic corridors are alsoneeded.

10. Human Resources

•Changes in government structure and planning with regards to itsapproach to implementing envrionmental sustainable practices into theMP3EI. At the moment, many stakeholders are concerned that theMP3EI is not aligned at all with plans to reduce carbon emissions. Lowcarbon investments need to occur and PPPs in this regard should beencouraged with incentives from the national government.

11. EnvrionmentalSustainability



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REFERENCES

Primary Sources

1. Four reports submitted by The Polling Center. Copies of these can be found in the Annex.2. Data collected at the four seminars conducted in this project.

Secondary Sources

Asia-Pacific Economic Cooperation. 2011. Indonesia’s Structural Reform Priorities. Retrievedfrom http://aimp.apec.org/Documents/2011/SOM/WKSP/11_som_wksp_009.pdf

Asian Development Bank. 2007. Midterm Review of the Greater Mekong Sub-region Strategic

Framework (2002-2012). Retrieved from http://www.adb.org/documents/midterm-review-greater-mekong-subregion-strategic-framework-2002-2012

Asian Development Bank. 2010. Mid-term Review of the Indonesia-Malaysia-Thailand GrowthTriangle (IMT-GT) Roadmap for Development: 2007-2011. Retrieved fromhttp://www.adb.org/publications/mid-term-review-imt-gt-roadmap-development-2007-2011

Asian Development Bank. 2010. Strategy and Action Plan for the Greater Mekong Sub-region

East-West Economic Corridor. Retrieved from http://www.adb.org/publications/strategy-and-action-plan-greater-mekong-subregion-east-west-economic-corridor

Asia-Pacific Economic Cooperation. Indonesia’s Structural Reform Priorities. Residential

Training Workshop on Structural Reform Singapore August 10-12, 2011. Retrieved fromhttp://aimp.apec.org/Documents/2011/SOM/WKSP/11_som_wksp_009.pdf

Badkar, Mamta. Indonesia Just Got Its Investment-Grade Credit Rating Back. Business Insider,

January 19, 2012. Retrieved from http://articles.businessinsider.com/2012-01-19/markets/30642206_1_indonesia-shocks-policy#ixzz1qo4tK8vS

Banomyong, Ruth. 2010. Benchmarking Economic Corridors Logistics Performance: A GMS

Border Crossing Observation. World Customs Journal Volume 4, Number 1. Retrievedfrom http://www.worldcustomsjournal.org/media/wcj/-2010/1/Banomyong.pdf

BAPPENAS. 2011. Sustaining Partnership: Media for Information on Public Private

Partnership. National Connectivity 2011 Special Edition. Retrieved fromhttp://pkps.bappenas.go.id/attachments/article/957/DESEMBER%20Khusus_KONEKTIFITAS_ENGLISH_L.pdf

Dewi, Andini H. 2011. 2011 Indonesian Law Review: Tax Holiday. Indonesian Legal




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http://www.adb.org/publications/strategy-and-action-plan-greater-mekong-subregion-east-west-economic-corridor






http://articles.businessinsider.com/2012-01-19/markets/30642206_1_indonesia-shocks-policy#ixzz1qo4tK8vS



http://www.worldcustomsjournal.org/media/wcj/-2010/1/Banomyong.pdf



http://pkps.bappenas.go.id/attachments/article/957/DESEMBER%20Khusus_KONEKTIFITAS_ENGLISH_L.pdf


















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Consultants (SSEK). Retrieved from http://blog.ssek.com/index.php/2011/12/2011-indonesian-law-review-tax-holiday/

Edward Lee Wee Kok, Eric Sugandi, Fauzi Ichsan, Jennifer Kusuma, Tai Hu. 2011. Indonesia in

the Super-Cycle. Standard Chartered Bank. Retrieved fromhttp://hictrade.com/Indonesia.pdf?AspxAutoDetectCookieSupport=1

Heart of Borneo: The Economics of Ecosystems and Biodiversity. December 2011. Retrievedfrom http://www.naturalcapitalproject.org/pubs/HCP1018%20-%20Natural%20Capital%20website%20v0%202_Example%20findings_FINAL.pdf

KOMPAS. Daily Infrastructure News on AUSAID Indonesia Infrastructure Initiative. KOMPAS, June 9, 2011. Retrieved from http://indii.co.id/news_daily_detail.php?id=645

Lipsey, Robert & Fredrik Sjoholm. 2011. Foreign Direct Investment and Growth in East Asia: Lessons for Indonesia. Retrieved fromhttp://www.tandfonline.com/doi/abs/10.1080/00074918.2011.556055

Mastel, (Indonesian ICT Society) ‘Toward National Connectivity- Challenge and Opportunity),Dr. Setyanto P. Santosa, Chairman of Mastel, Jakarta 21 September 2011 Presentation.

Nuky, Esther. Without Extraordinary Budget, MP3EI Only a Dream: Infrastructure Bonds to beIssued Soon. Investor Daily, November 28,2011. Retrieved from

http://emu.co.id/news_daily_detail.php?id=2412

Republic of Indonesia. 2011. Masterplan Acceleration and Expansion of Indonesia

Economic Development 2011-2025. Retrieved fromhttp://www.itpchamburg.de/pdf/Home/ECONOMIC%20CORRIDOR.pdf

Supriadi, Oleh Agust. Government to Launch Global Bonds in February 2012. Bisnis Indonesia,

December 19, 2011. Retrieved from http://en.bisnis.com/articles/govt-to-launch-global- bonds-in-february-2012

Tampubolon, Hans David. 2012. Enactment of Land Acquisition Law Delayed Again. The Jakarta Post, March 14, 2012. Retrieved fromhttp://www.thejakartapost.com/news/2012/03/14/enactment-land-acquisition-law-delayed-again.html

The Jakarta Globe. As MP3EI Blossoms, Resolve Is Needed. The Jakarta Globe. March

http://blog.ssek.com/index.php/2011/12/2011-indonesian-law-review-tax-holiday/



http://hictrade.com/Indonesia.pdf?AspxAutoDetectCookieSupport=1


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http://www.tandfonline.com/doi/abs/10.1080/00074918.2011.556055




http://www.itpchamburg.de/pdf/Home/ECONOMIC%20CORRIDOR.pdf

http://en.bisnis.com/articles/govt-to-launch-global-bonds-in-february-2012



http://www.thejakartapost.com/news/2012/03/14/enactment-land-acquisition-law-delayed-again.html







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ANNEXES

Annex A. The Polling Center‘s Interviewees

During the Kalimantan Seminar:

Government Civil Society Private Sector

WestKalimantanProvincial Govt.

1 Walhi,Samarinda

1 Kideco Jaya Agung 1

WestKalimantanBPPMD

3 WWF, Jakarta 1 Pertamina 1

SamarindaBPPMD

1 BOSF/RHOI 1 Feedback Infra 1

SamarindaBappeda

1 Bina Swadaya 1 South KalimantanKadin

1

PalangkarayaUniversity

1 East KalimantanApindo

1

MulawarmanUniversity

1 East KalimantanPost

1

Sub – total 6 Sub – total 6 Sub – total 6

Total : 18 respondents



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During the Lombok Seminar:

Government Civil Society Private Sector Bappeda Bali 1 WFP 1 Kadin Denpasar 1

Bappeda NTB 1 WWF Jakarta 1 HSBC 1

Bappeda WestLombok

1 APKLI 1 ASITA 1

Bappeda MataramCity

1 Economic expert 1 Charoen Pokphand 1

BPMD NTB 1 Mataram

University

1 Bali tourism board 1

Bali CulturalOffice

1 Gappindo 1

Office of Transportation NTB

1

Food SecurityAgency NTB

1

Office of Fisheryand Marine Affairs NTB

1





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During the Climate Change Mitigation Seminar and Ad Hoc Appointments in Jakarta

Note: Verbatim quotes from these stakeholders coming from interviews with The Polling Center

can be found throughout this paper separated in text boxes.

Government Civil Society Private Sector

Governor of DKIJakarta

1 Aceh Green 1 PWC 1

Dept. of theEnvironment

1WWF Jakarta 1 British Embassy 1

Dept. of Forestry 1 IPB 1 KADIN 1

House of Representatives

1Bakrie University 1 Pertamina 1

NationalDevelopmentPlanning Agency -Bappenas

1TrisaktiUniversity 1 Bakrie Corp 1

Capital InvestmentCoordinatingBoard - BKPM

1GIZ 1

National Instituteof Aeronautics andSpace - LAPAN

1Walhi 1

Habibie center 1

Kompas 1

Infid 1

Univ. Mercu buana

1





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Annex B: List of Pending Laws, Government Regulations, Presidential Regulations,

Presidential Decrees, Presidential Instructions and Ministerial Regulations



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Source: MP3EI



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Annex C: KP3EI Structure at the National Level

Division of

International

Cooperation

Working Group

for the Sulawesi

Corridor

Working Group for

the Kalimantan

Corridor



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Annex D: KP3EI Structure for the Kalimantan Corridor

President Susilo Bambang

Yudhoyono

Hatta Rajasa, Coordinating

Minister for Economic Affairs,

KP3EI Secretariat

Dr. Thamrin Sihite, Director General

of Mineral and Coal, Ministry of Energy and Mineral Resources,

Chairman of the Sub Team onRegulation

Sub Team on Connectivity

Prof. Dr. Hermanto Siregar, Vice

Rector of Bogor AgriculturalUniversity, Chairman of the Sub Team

on Human Resources and Science &Technology

Mr.Ir. Luky Eko Wuryanto MSc.

PhD, Deputy Minister of Infrastructure and Regional

Development, Coordinating

Ministry for the Economy, andHead MP3EI Secretariat

Dr. Ir. H. Suswono, MMA, Minister

of Agriculture, Head of the

Kalimantan MP3EI Working Group

Governors of West, East, South

and Central KalimantanHead of BAPPEDA Offices in West,

East, South and Central Kalimantan

Heads of KADIN Offices in West, East,

South and Central Kalimantan



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Annex E. KP3EI Structure for the Bali-Nusa Tenggara Corridor

President Susilo Bambang

Yudhoyono

Hatta Rajasa, Coordinating

Minister for Economic Affairs,KP3EI Secretariat

Dr. Thamrin Sihite, Director General

of Mineral and Coal, Ministry of

Energy and Mineral Resources,

Chairman of the Sub Team onRegulation

Sub Team on Connectivity

Prof. Dr. Hermanto Siregar, Vice

Rector of Bogor Agricultural

University, Chairman of the Sub Team

on Human Resources and Science &Technology

Mr.Ir. Luky Eko Wuryanto MSc.

PhD, Deputy Minister of

Infrastructure and Regional

Development, CoordinatingMinistry for the Economy, and

Head MP3EI Secretariat

Mari Elka Pangestu, Minister of

Tourism and Creative Economy,

Head Bali- Nusa Tenggara CorridorMP3EI Working Group

Governors of West, East, South

and Central KalimantanHead of BAPPEDA Offices in West,

East, South and Central Kalimantan

Heads of KADIN Offices in West, East,

South and Central Kalimantan



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Appendix F: Attendance List of Four Seminars

Seminar One- Implementing the Kalimantan Corridor

Tuesday 6th

October 2011

Balikpapan, KalimantanAttendance List

Number Name Organisation

1 Jamartin Sihite BOSF/RHOI

2 Edwin Shabby Pertamina

3 Reza Pahlefi Pertamina

4 Yuli Lestari Tropenbos

5 Shailesh Joshi Feedback Infra, Jakarta

6 Ujang Rachmad Bappeda, East Kalimantan

7 Duma M. Bappeda, East Kalimantan8 Siti Khoirun Niumah INFID, Jakarta

9 Vicky R. Waan KPSI

10 Darmae Nasir University of Palankaraya

11 Rika Gresia Pertamina

12 Eddy Suratman Univeristy of Tanjungpura

13 D. Yuli BPMD Kalimantan Barat

14 Ida Karimi Provincial Government of Kalimantan Barat

15 Syamsuwir BPMD Kalimantan Barat

16 Mauases University of Balikpapan

17 Sanusi Saudesi BPPMD, Kalimantan Timur 18 Dachriadi BPPMD, Kalimantan Timur

19 M. Slamei SS DPP Apindo Kalimantan Timur

20 Saridi Salimim KADIN Kalimantan Selatan

21 Yusmilan Ak. KADIN Kalimantan Selatan

22 M. Yadi Sabainoor BPPMD, Kalimantan Timur

23 Heryanto University of Mulawarman

24 Tatanos Kaltim Post

25 Agus Subagyo Kideco Jaya Agung

26 Arie Rompas Walhi, Central Kalimantan

27 Bambang Awaman Bima Swadaya28 Eddy Yurat Bappeda, East Kalimantan

29 Dodhy Achadiyat APINDO

30 Wikondar Bappeda, East Kalimantan

31 Rezal Jurad Kaltim Post

32 Elsa R. Pasaribu Balikpapan TV

33 Wisnu Rusmantoro WWF, Jakarta



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34 Elisabeth Wetik WWF, Jakarta

35 Dinda WWF, East Kalimantan

36 Wiwian Effendy WWF, East Kalimantan

37 Arif Data Kusana WWF, East Kalimantan

38 Denise Medina Polling Center

39 Relawati Polling Center

40 Restu Nurully Polling Center

41 Fauziah S Polling Center

42 Maxine Carr Strategic Asia

43 Eny Marliana Strategic Asia

44 Prabowo Strategic Asia

45 Keith Hargreaves Strategic Asia

Seminar Two- Implementing the Bali- Nusa Tenggara Corridor

Tuesday 09th December

Lombok, Nusa Tenggara Barat

Attendance List


1 Bapak Bapak Haj Muhammed Noor SHMH

Provincial Secretary NTB

2 Ray Tumundo PT. Charoen Pochpand

3 Imam Budiman Mataram News

4 Imam Waliyudi Hotel Vila Ombai

5 AA Gede Sumadi Putra Strategic Asia6 Maxine Carr Strategic Asia

7 Henry BS Bappeda NTB

8 Andy Widando Bappeda NTB

9 Rastiti Bappeda Bali

10 I.B. Budi Utama Bappeda Bali

11 Hadi Irfam Zahiq BPM NTB

12 M. Anwar BPM NTB

13 Paul Edmundis Talo APD Astik, Bali

14 Rositam Taulih PT. Lombok Saba

15 B. Sri Kumi Alaris BPM NTB16 Hj BQ Hosri Z BPM NTB

17 I. NGH. Gusia Dinas Budpar NTB

18 Husnussabri Dinas Perkeaunan NTB


20 L. Michael Riwu Kaho Undana- Kupang

21 Ali Syanya Kelauta NTB



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22 Erni Margioaro BEDO

23 Rara Rizal Interpreter

24 M. Irwan Prasetya LSM/Pengamat Eko

25 Ridwansyah Disbub NTB

26 Sang A Subaya DPD HPI, Bali

27 Rajeev Babel HSBC, Jakarta

28 AA Gede Geriya Disbud Bali

29 Erni Kuranaiti Diskop Sumkm, NTB

30 Daihi Pariyami Diskop Sumkm, NTB

31 Devi HSBC, Jakarta

32 Ramayoga Bappeda Mataram

33 Tony Rahardjo WFP

34 L. Sukariao BKP NTB

35 Rosiady Head, Bappeda NTB

36 Armin Alamsyah Dinas PKH

37 Eko B Suadu Dinas PKH

38 Bambang Sabolu Dinas PKH

39 Arnantyo COKA

40 Ikerit Nukymsa DPD. Putri, Bali

41 Bagus Sudibya Bali Tourism Board

42 Sukismars Lombok Post

43 R. Razavi British Embassy

44 Koeswidiab BPMD Mataram

45 Nara Melissa British Embassy46 Denise Medina Polling Center

47 Fauziah S Polling Center

48 Dewanto Bappeda Lombok Timur

49 Abdul Haris Biko AP NTB

50 B. Wilyatis Biro Ekonomi

51 K. Wolini DPP. Apindo NTB

52 Haryadi Bappeda Lotim

53 Bayan BKPMD, Lombok

54 Ahmad Zaini UNRAM

55 I B Sudewa KADIN Bali56 Ketut Kanuam KADIN Bali

57 Imam MZ WWF, Jakarta

58 H. Dadif BKPMD, Lombok

59 Lilly PC

60 Aries PC

61 M. Nur Sekda NTB



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62 Ahmad Yani Radar Lombok

63 WM. Ardhi Provincial Government of NTB

64 Agung Polda

65 Husnuaindeaty BKP

66 Yasid Jayaldi PT. Bulan Malv

67 Syarif H Bappeda Lombok Barat

68 Rohida Ganis M Biro Adm Pembangumam Setda Provinso NTB

69 Ririn Novilina Biro Adm Pembangumam Setda Provinso NTB

70 Prayitno Basuki UNRAM

71 Bambang Istiyanto Dishub Kominfo

72 Sukarsa Dimas Perstia NTB

73 Khaeriel Auntar Kompas

74 Indah Irviani Strategic Asia


76 Satish Mishra Strategic Asia

Seminar Three- Climate Change Mitigation and the MP3EI

Wednesday 8th

and Thursday 9th

February 2012

Jakarta

Attendance List


1 Zaky prabowo UKP4

2 Kamarudin BAPPEDA-NTB

3 Husaini Syamaun BAPEDAL Aceh4 Samsuar Bappeda Aceh

5 Dharma Putra Bappeda Bali

6 I. B Wayan Bappeda Bali

7 Syaiful Firdaus BAPPEDA PAPUA

8 M. Chamidin DDPI Kaltim

9 Faisal Bappeda Sulsel

10 Endah Murniningtyas Bappenas

11 A.A Bagus Sudharsana BLH Kota Denpasar

12 Rebecca Razavi British Embassy

13 Daniel Mudiarso CIFOR

14 Dodik R Nurrochmat IPB

15 Sulistyowati Ministry of Environment

16 Deddy Hadriaynto Mulawarman University

17 Kirsfianti L Ginoga Puspijak. Litbang

18 Rob Daniel PWC

19 Heru Prasetyo UKP4



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20 Nyoman Iswarayoga WWF Indonesia

21 Benja Victor Mambai WWF PAPUA

22 Suhaimi Hamid Aceh Green Community

23 Rusnadi padjung KPDT

24 Agus Gunawan Ministry of Environment

25 Sudirga Bappeda Bali

26 Irfan D Yunanto Bappenas

27 Umiyatun Hayati( a/N Ulfi) BAPPENAS

28 Sanusi Saudek BPPMD Kaltim

29 Neale Jagoe British Embassy

30 Nara Melissa British Embassy

31 Farah Sofa British Embassy

32 Syamsuddin DDPI KALTIM

33 Idham Moe Dit. BPSDA, PU34 Pandu yuri P Dit. BPSDA-KEMEN, PU

35 Winarni FALTL Trisakti University

36 Siti B. wardhani FCO

37 Amelia Saragi FCO

38 Maren Breuer GIZ

39 Taslim Arifin Hasanudin University

40 Resa Raditio ICEL

41 Luluk Sumiarso IICE

42 Nikmah Infid

43 Rara Interpreter 44 Barry Djadid KADIN NTB

45 Ikhsan KAMMI

46 Erna Sri Adinigsih LAPAN

47 Nuning Elmayani Ministry of Forestry

48 Phillipp Munzinger PARLIM GIZ

49 Boni Saji Pink HKBP

50 Lucya nazarina Polling Center

51 Nefo Djnuarita Polling Center

52 Relawati Polling Center

53 Denise Medina Polling Center 54 Eliyani Psat Perubahan Iklim UMB

55 Catur Hernanto PT FTG

56 Yoga PT FTG

57 Diesty Eka PT. ASPHALT BANGUN SARA

58 Sukria PUI

59 Keith Hargraves Strategic Asia



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61 Clarisse Strategic Asia

62 Satish Misra Strategic Asia

63 Akira Moretto Strategic Asia

64 Daim Syukriah Strategic Asia

65 Budi Kuncoro TNC

66 Jannes Siahaan Trisakti

67 Tony Bambang Trihartanto Universitas bakrie

68 Eko Kurniawan UNJ

69 nassat D Idris USAID

70 Rini Astuti WWF

71 Yudi Hermawan Yayasan Expecta Sejahtera

72 Vlasios Voudoris London Metropolitan University

73 Derri Habir Strategic Asia74 Michael moody British Embassy

75 Fifih Octavia Prudential

76 Hernani Yulinawati Univ.Triskakti

77 Nuning Elmayani Pusat KLN Kemenhut

78 Ujang R Bappeda Kaltim

79 Yun Handrison Prudential

80 Zulazmi GIZ

81 Faisal Buadsal

82 Daddy Ruhiyat DDPI Kaltim

83 A.A Bagus Sudharsana Ka BLH Ops84 Dedy Hadriyadi Unmel

85 Lidwina Adeline Trisakti University

Seminar Four- Implementing the MP3EI at the National Level

Wednesday 14th

and Thursday 15th

March 2012

Jakarta

Attendance List

Day One


1 Emma Allen ILO

2 Rudianto H PII

3 Agus gunawan KLH

4 hasiando P.L Tobing Strategic Asia

5 Prof. Daddy Ruhiyat Dewan Daerah Perubahan Iklim



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6 A Wahab Kemenaker

7 Aries R. Prima PII

8 Venny ICEL

9 David H Biro Perencanaan Kemenhut

10 Noor Syaifudin BKF Kemenkeu

11 Christine Wulandari Forum Komunikasi kehutanan / UNILA

12 Edward Panjaitan SGU

13 Merry LG International

14 M Taufiq Rinaldi PKPS BAPPENAS

15 Sukria W PUI

16 Dharsono Hartono PT Rimba Makmur Utama17 Harsina DNPI Mitigasi

18 Tri Widayati KLH

19 Yulia Fatma Asri ICEL

20 Nulsono BKF Kemenkeu

21 Neneng Djuaeriah SGU

22 Pitojo budiono Capabel

23 Bastary P. Indra Bappenas

24 Mawardi Amin UMB25 Edib Muslim Menko Perekonomian KP3EI

26 Nirmal Nikhar Strategic Asia

27 Rudy Tobing SGU

28 Hernani Yulinawati Trisakti University

29 Waspodo Kemenhut

30 Rakhmindyarto Kemenkeu

31 Kate O’Loughlin Strategic Asia

32 Akira Moretto Strategic Asia33 Adrinanus Mooy UPH / Strategic Asia

34 Minesh Dave Tata Power

35 Anwar Sumaroi Bappenas

36 Resa Raditio ICEL

37 Adam Tomasek WWF



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38 Mulyono Prabowo BMKG

39 Roy Abimanyu OXFAM

40 Rauf Prasodjo WRI

41 Iwan R PARAMADINA

42 Hendra Gunawan Jasa Marga

43 Michael Marien GIZ

44 Budi Kuncoro TNC

45 Torill wanvik Embassy of Norway

46 Daju Resosudarmo CIFOR

47 Rahmat Hidayat BNI

48 Heru Komarudin CIFOR

49 Victor Mammor FOKER LSM Papua


51 Hairul Anwar Sekretaris Aceh Green Community

52 Praselyono Widjoyo BAPPENAS


54 Syafiuan Rozi Subhan P2P CHI

55 Dewa Yojwia staff BAPPEDA

56 MK.S. Yuliadewi Kader Staff Bappeda Bali

57 Rudy E Prayitno Pam Jaya

58 D.Yvanger BritCham

59 Alfred N US Embassy

60 Nikko Indra W Martahon Oil

61 Syaeful Firdaus Bappenas Papua

62 Budi S PDAM DKI

63 Ulrich Mohr GIZ

64 Adrian Short Rolls Royce

65 Yudy Hermawan Yayasan Expecta Sejahtera

66 Sanusi Saudek BPPMD Kalimantan Timur

67 Wisnu Rusmantoro WWF Heart of Borneo

68 Markus Kajoi FOKER LSM Papua

69 Deddy Hadriyanto C3s_ummul



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70 Indah Si.I Strategic Asia

71 Erni Margiono BEDO

72 Lian Jap British Embassy

73 Rismawati Bappeda PAPUA

74 Japa Pratama Martahon Oil

75 Nara Melissa British Embassy

76 Agus Gunawan KLH

77 Krsihna R Suparto BNI

78 Andree Eka Pinata TNC

79 Erick Purwanto Balfour

80 I Wayan Arthana University Udayana PPLH - UNUD

81 Suhaimi Hamid Aceh Green Community (ACG)

82 Saur Parsanran T BAPPEDA Kaltim

83 Didik Wahyudianto PTCharoen Pokphand Indonesia-Bali

84 Ray Tumundo PT Charoen Pokphand Indonesia-Bali

85 Indah Eliana BLH / DDPI

86 Siti B Wardhani FCO Jakarta

87 Husni Fahri Bappeda NTB

88 Ryandiaz T Martahon Oil89 Kerstin Nagels GIZ

90 Asclepias Rachri USAID-ICED

Day Two

Numbe

r

Name Organisation

1 Noerojo BKF Kemenkeu

2 Elme de Loitière PLAYJA

3 Noor Syaifudin BKF Kemenkeu

4 David H Kemenhut

5 Sukria W PUI

6 Lian Jap British Embassy

7 Gunawan IHCS



of 87

8 Harsina DNPI Mitigasi

9 A.A. Gede Sumadi Putra Strategic Asia Bali

10 Ari W. Adipratomo Strategic Asia

11 Yosman Bustaman Swiss German University

12 Markus Kajoi FOKER LSM Papua

13 Victor Mammor FOKER LSM Papua

14 Jonathan Mantle International Expert, London

15 Deddy Hadriayanto Head of Climate Change Study, MulawarmanUniversity, Samarinda East Kalimantan

16 Hernani Yulinawati Trisakti University

17 Erni Margiono BEDO

18 MK.S. Yuliadewi Kader Staff Bappeda Bali

19 Indah Si.I Strategic Asia

20 Ray Tumundo PT Charoen Pokphand Indonesia-Bali

21 Mawardi Amin UMB

22 Reynardo Nainggolan Danareksa

23 Sanusi Saudek BPPMD Kalimantan Timur

24 Rudy Tobing Swiss German University

25 Venny ICEL

26 Husni Fahri Bappeda NTB

27 Didik Wahyudianto PT Charoen Pokphand Indonesia-Bali

28 Eliyani UMB

29 Diah Noor British Embassy

30 Dhona ElFurqon IHBS

31 Hairul Anwar Aceh Green Community (ACG)

32 Debi Nathalia DNPI Mitigasi

33 Merry LG International

34 Iis Alviya Puspijak

35 Elvida YS Puspijak

36 Mega Lugina Puslitbang Perubahan Iklim dan KebijakanKehutanan

37 Yudy Hermawan Yayasan Expecta Sejahtera

38 Dodik R. Nurrohmat IPB



of 87

39 Ida Ayu Cintya Strategic Asia

40 Vina Hutapea Danareksa Capital

41 I Wayan Arthana University Udayana PPLH - UNUD

42 Syaeful Firdaus BAPPENAS Papua

43 Rismawati BAPPEDA Papua

44 Saur Parsanran T BAPPEDA Kaltim

45 Indah Elian DDPI/ BLH East Kalimantan

46 Roy Abimanyu OXFAM

47 Budi Kuncoro TNC

48 Sandi Kemenhut

First Low Carbon Economy Knowledge Hub 9

thFebruary 2012

Attendance List

1. Eko Kurniawan, Universitas Negeri Jakarta2. Suhaimi Hamid, Aceh Green Community3. Sukria, PUI, 0878637838984. Ir. Faisal, M.Si, Badan Lingkungan Hidup Daerah, South Sulawesi5. Idham Moe, Ministry of Public Works6. Dr. Deddy Hadriyanto, GS Unmal7. Benja Victor Mambai, WWF Papua

8.

Akira Moretto, Strategic Asia9. Daim Syukriyah, Strategic Asia10. Maxine Carr, Strategic Asia11. Keith Hargreaves, Strategic Asia12. Prabowo, Strategic Asia

Second Low Carbon Economy Knowledge Hub

15th

March 2012

Attendance List

1. I Wayan Ardana, PPLH at University of Udayana.

2.

Suhaimi, AFIC3. Rismawati, Bappeda, Papua4. Haimal Anwar, Aceh Green5. Indah Eliana, DDPI/BLH Kalimantan Timur 6. Deddy Hadriyanto, Univeristy Mulawarman7. Dodile R. Nurroclimat, IPB8. Sukria W, POI9. Prabowo, Strategic Asia



10. Akira Moretto, Strategic Asia11. Daim Syukriyah, Strategic Asia12. Idaayu Cintya, Strategic Asia13. Maxine Carr, Strategic Asia

Implementing the MP3EI Paper.pdf

Documents

Transcript of Implementing the MP3EI Paper.pdf