The Week in Review: Graft, rupiah and blackouts

The Corruption Eradication Commission’s (KPK) separate arrests of former social services minister Bachtiar Chamsyah and former Indonesian ambassador to the US Sudjadnan Parnohadiningrat demonstrate how serious President Susilo Bambang Yudhoyono is about his commitment to combat graft.

The KPK alleged that Bachtiar, who was named a suspect in March, inflated the price for the purchase of sarongs between 2006-2008, and overstated the procurement price of sewing machines and cattle intended for distribution to the poor as part of the government’s poverty eradication program between 2004-2006.

The KPK also accused Bachtiar of favoritism, alleging he directly appointed certain companies for the procurement projects. According to a 2003 presidential decree on procurement, direct appointment is only permissible for government projects worth less than Rp 50 million (US$5,600). The combined procurement value of the sewing machines and livestock was Rp 59 billion, the KPK said.

Bachtiar has denied the allegations.

Sudjadnan allegedly embezzled $175,000 from a budget allocated for renovating the residential compound at the Indonesian Embassy in Singapore. The project was estimated to cost Rp 16.4 billion.

However, this week the word “redenomination” is the talk of the town. Some people from the older generation have voiced concerns that Indonesians might face a reduced exchange value of the rupiah, as they experienced five decades ago.

The newly elected Bank Indonesia Governor Darmin Nasution has tried to calm the public, saying the central bank’s plan for the rupiah redenomination would only strike zeros from the current denominations. Nasution explained that the redenomination proposal was different from the government currency policy in the early 1960s, which devalued the currency.

The central bank said the measure would take 10 years to implement. The measure is deemed necessary because the rupiah exchange rate is too low against other currencies, being the third-lowest currency in terms of exchange rate value against the US dollar, just above the currencies of Mozambique and Vietnam.

Analysts and observers urged the central bank to educate the public, especially in rural areas, about the details of the plan to avoid unnecessary social problems. If successful, the plan could have a positive psychological impact on investors.

The rupiah exchange rate is not the public’s only concern, especially Jakartans, who are suffering deteriorating traffic conditions. The Jakarta administration’s landmark transportation project, the TransJakarta  busway, launched by then governor Sutiyoso in January 2004, has not relieved the city’s acute traffic problems. As one possible solution, the Jakarta Police have begun an operation to clear busway lanes from motorists, issuing hundreds of tickets to car drivers and motorcyclists caught using the designated lanes. By law, only TransJakarta buses are allowed to use the busway lanes.

The potential threat of total gridlock, estimated to become reality within three years, has also prompted the central government to revisit the idea of relocating the Indonesian capital. Presidential special staffer Velix Wanggai said Yudhoyono was aware that Jakarta’s overcrowded conditions have impaired the government’s abilities to efficiently provide necessary services but did not see relocating Indonesia’s capital city as part of the government’s immediate agenda. However, Yudhoyono has carefully considered Jakarta’s recurring problems with traffic gridlock, flooding, overpopulation, urbanization, environmental degradation and the city’s vulnerability to earthquakes.

Palangkaraya in Central Kalimantan, Jonggol in West Java and Jayapura in Papua have been proposed as candidates for Indonesia’s new capital city. It is not the first time that relocating the capital had been suggested. Founding president Sukarno nominated Palangkaraya as the country’s new capital, while his successor, Soeharto, proposed Jonggol as an ideal substitute.

Jakartans are burdened further by an erratic electrical power supply. People in some parts of the capital, including Jakarta’s main thoroughfares and the Soekarno-Hatta International Airport, had to cope with unpredictable blackouts during busy business hours. State power firm PT Perusahaan Listrik Negara (PLN) said that the power supply from its Muara Karang power plant in North Jakarta dropped by 700 megawatts Tuesday morning because its facilities were hit by a crane commissioned to help expand the power plant’s capacity.

The incident came only a week after Yudhoyono launched the “blackout-free Indonesia” movement.

Acknowledging that electricity was a basic need for domestic households, industries and the government, Yudhoyono said that 19 million families in the country still had no access to electricity, despite that the government is still covering a Rp 55 trillion annual electricity subsidy.

Communication and Information Minister Tifatul Sembiring had to deal with an outcry from BlackBerry owners in Indonesia after reports said that Indonesia might follow the United Arab Emirates ban on BlackBerry use and Saudi Arabia’s restrictions on the device. The minister said he only requested BlackBerry producer Research In Motion Ltd. (RIM) set up a data center in a bid to enable law enforcement officials the ability to track the communication records of suspected criminals using the device.

Last but not least, viewers have picked a new Indonesian Idol winner. At least there is some good news for the young people in this country.

— Primastuti Handayani