Wednesday, July 01, 2015

Why Ramadan is a special economic season in Indonesia (& Australia's export bonus)

By Alin Halimatussadiah, University of Indonesia

The Islamic calendar has entered the second week of Ramadan. During this month, Muslims refrain from eating, drinking and sexual activities from dawn to dusk.

But, in countries where Muslims are the majority, consumption increases during this month of restraint. This happens not only in high-income countries, such as Qatar and United Arab Emirates, but also in developing countries such as Indonesia.

Traditions that spur consumerism during Ramadan and preparations for Idul Fitri, the end of Ramadan, drive this trend.

Spending patterns

People spend more during Ramadan – mainly on food and beverages, but also on clothing. In Indonesia, the retail sales index on these categories showed a 30% increase during the Ramadan month in 2013.

Meals taken during Ramadan help tighten family ties and increase social interactions. In the fasting month, Muslim families usually have sahur – the pre-dawn meal – and iftar – the fast breaking meal – together, with more elaborate menus than in other months. People also have more social gatherings by breaking the fast together in restaurants at malls or in mosques.

Just after Ramadan ends, Muslims celebrate Idul Fitri. They start preparing for this holy day weeks before. People wear new clothes during Idul Fitri. They make or buy an assortment of cookies and sweets. They also prepare special menus to be enjoyed and served to guests.

The main ingredients for the festive meals are mostly beef or chicken. The Indonesian government has to ensure that beef is stocked for Ramadan and Idul Fitri holidays. Australia, as the biggest exporter of live cattle to Indonesia, benefits much from the Ramadan season.

People take the time to visit family and friends during Idul Fitri. In Muslim majority countries, the time around Idul Fitri is a long holiday. In Indonesia, the government obliges employers to pay a religious holy day bonus. This one-month salary bonus helps increase the public’s spending power during Ramadan and Idul Fitri.

Clothing sales increase in Ramadan and ahead of Idul Fitri. EPA/Mast Irham

Paying alms

During Ramadan, Muslims pay alms (zakat). The increase in alms can quadruple from regular months.

The compulsory alms in Ramadan, the zakat fitrah, is actually not much – around 3.5 litres of rice per person. But many Muslims pay other types of compulsory alms that are actually payable in other months.

Aside from zakat, spending on charities that are not compulsory also increase during Ramadan. The channelling of zakat and charity for the poor also factors in the increase in purchasing power.


Indonesians often complain about high inflation during Ramadan. Prices for food, transportation and recreation usually rise during the fasting month.

But the holiday bonus plays a role as a safety net for people’s spending power. Zakat also helps the poor cope with rising prices of food. Last year, food prices increased 2% during Ramadan.

Prices for flights, and train and bus rides, also increase as the end of Ramadan marks the start of a long holiday in Indonesia. A lot of people go to their hometowns or where their parents or grandparents live. Even though formally the Idul Fitri holiday is two days, in reality people take a week off. Many workers take their annual leave. Plane ticket prices can increase twofold. Some are fully booked long before the day of travel.

Productivity during Ramadan

Reduced working hours is common during Ramadan. A two-hour workday reduction, as occurs in Pakistan and Egypt, brings an estimated 7.7% decrease in the country’s monthly GDP. For countries that only cut an hour of its workday – such as Indonesia and Malaysia – the decrease is around 3.8%.

Workers' productivity tends to decline during Ramadan. A rough figure of decrease in productivity in Muslim majority countries is between 35% and 50%. However, the slowing down of productivity in Ramadan is predictable, meaning the economy can anticipate it.

The decrease in productivity happens as people choose subjective well-being from religious and Ramadan-related activities over the benefit people might get from working. During Ramadan, Muslims tend to do more religious activities and take time for activities related to Ramadan, such as breaking the fast with family, sprucing up their house and making cakes.

When people feel they get more positive benefits from non-work activities, the opportunity cost – the value that people sacrifice to gain something – from work increases.

In his study on Ramadan, Harvard economist Filipe Campante finds that, in the fasting month, people tend to choose self-employment (with flexible working hours) over formal employment. Campante says Ramadan makes people poorer but happier.

Being social

Many economic activities related to Ramadan and Idul Fitri are not just for private consumption – they are also collective ones.

Networking activities happen during Ramadan and Idul Fitri. Fast-breaking gatherings, religious activities in mosques, social bazaars and the Idul Fitri holiday exodus facilitate information exchanges. On the journey to their hometowns, people bring souvenirs for family and friends. There, people catch up and exchange information about activities in cities.

These social gatherings can increase further economic activities.

Ramadan has the potential to improve Indonesia’s current economic slowdown with its increase in consumption and trade. However, economic activity on this year’s Ramadan is predicted to be lower than previous years. The lunar calendar has brought Ramadan to coincide with school holidays in Indonesia in 2015. This means less holiday travel for Indonesians.

The Conversation
Alin Halimatussadiah is Researcher in Economics at University of Indonesia.

This article was originally published on The Conversation. Read the original article.

Saturday, June 20, 2015

Charlie Chaplin in Jakarta highlights the first Qantas international passenger route

QANTAS AIRWAYS' long history and close engagement with Indonesia and South East Asia over 80 years is reflected in the fact that the pioneering Australian airline's first international operation was the Darwin-Kupang-Batavia-Singapore airmail freight route which commenced on 26 February 1935.

From 17 April that year Qantas transferred one of its five "elegant, four-engine" biplanes, the de Havilland DH86, for its first overseas passenger flight from Brisbane to Singapore, a four-day trip that included overnight stops at Cloncurry, Darwin and Rambang (Lombok). The route, which  also included Batavia (now Jakarta, capital of Indonesia), was part of an Australia to London alliance with Imperial Airways (now British Airways).

Global movie star Charlie Chaplin, Qantas Captain Russell B. Tapp, actress Paulette Goddard and her mother Alta Mae Goddard, disembarking from a Qantas DH86 at Batavia (now Jakarta, Indonesia) on 23 March 1936. Source: Qantas Historic Image Gallery

Qantas charged 117 pounds, (roughly $3200 in today’s terms) for its first international service and no cabin crew were carried. The First Officer handed out drinks and sandwiches prepared on the ground although the passengers usually chose to eat meals at the fuel and overnight rest stops along the way.

International movie star Charlie Chaplin was one of the early international passengers. He and his fiance, actress Paulette Goddard, flew on Qantas from Singapore to Batavia during their 1936 world tour following the release of their movie "Modern Times". They then travelled around Java by car and holidayed in Bali.

Advertisment c1935, From the collection
of the State Library of  New South Wales
The DH86 biplane operated the Singapore service accident-free from 1935 to 1938, but was too small to meet the growing demand. Qantas then decided to introduce Short C Class Empire flying boats.

As the flying boats needed only a mooring buoy, terminal building and fuelling facilities, Qantas established a base at Rose Bay in Sydney. From there, he aircraft would fly the entire Australia-Britain route, with the Qantas and Imperial Airways crews changing in Singapore.

The Qantas DH86 fleet had a new lease of life during World War 2 when it was used to deliver ammunition to Australian and American forces in the New Guinea campaigns against the Japanese.

See also: 75th anniversary of the first Qantas flying boat service to South East Asia (4 Aug 2013)

Tuesday, February 10, 2015

Eating Friends: How Australian companies fared in ‘New Order’ Indonesia, 1990-97

Prepared in September 1997 by Tony Burchill and Geoffrey Gold for the ‘Directory of Australian Businesses in Indonesia’, this article was withdrawn at the time due to the severity of the Asian financial crisis, known in Indonesia as Krisis Moneter (Krismon), and resulting political disturbances.

A SAYING IN INDONESIA about doing business - teman makan teman, kawan makan kawan - roughly translates to "friends eat friends; mates eat mates".

We find it useful to quote this to visiting western business people who see the potential in the marketplace without being aware of the potential pitfalls. Javanese smiles often hide an appetite for the unwary!
ITB 1991: (l) Australian coal geologist Pat
Hanna (r) article co-author Geoffrey Gold

And yet the opportunity is tremendous. Predicted to become the fifth largest economy by  2020, the most populous Muslim-majority nation in the world has made enormous strides in the past 30 years. Nevertheless it is still coming off a low base with averages of 48 people per telephone and eight people per television set.

For hyped up Aussie business people told that they must export or perish, the temptation of catching one of the four airlines to Jakarta is often irresistible. That temptation is fine by itself. After all what's a round trip to Jakarta and a week’s stay at the Radisson. For most businesses it won't break the bank.

However the itch becomes a rash when ill-prepared businesses try to set up shop here.

According to a report released last month by the Murdoch University's Asia Research Centre which investigated the experience of corporate establishment for Australian service firms, the secrets of success are clouded in myths.

The report, Australian Service Companies In Indonesia: Learning from Experience, investigated the progress or otherwise of 63 Australian service companies in Indonesia since 1991.

The authors, Gitte Heij and Thorsten Stromback, concluded that contrary to popular belief, Indonesian factors such as poor economic infrastructure, excessive regulation, culture and language are overstated as reasons for failure in comparison with other factors.

The most important factors for success to the Indonesian market for the companies surveyed are internal to the particular company.

These included a long term outlook, senior management commitment, selection of a local partner, adequate in-house staff, dealing with the bureaucracy and having a competitive advantage.

Other less important success factors according to the report included professional advice, local equity requirements, competition from third countries, good support by Australian government organisations, Indonesian infrastructure, banks' support in Australia and the importing of necessary equipment.

Investing in Indonesia : expensive exercise

For the record, out of the 63 service companies surveyed; 41 are still active with a permanent presence on the ground, ten have bitten the dust, five are still active but under different names and seven are still active but no longer have a permanent presence on the ground.

Out of the survivors; 53% were satisfied with the rate of return from their business venture while 33% were not satisfied but expected a positive return in the near future. Most of the others had terminated the relationship with their initial business partner and had subsequently established a new business venture with better results.

A lot of figures but what do they mean? Well even with our high school maths, they tell us that in the space of six years, 17 companies out of 63 (or 27%) that set up shop here had pulled down the shutters. That’s an expensive exercise in this country. Out of the remainder, just over half were satisfied with current financial results.

Reading between the lines, it seems pretty obvious that the large majority of firms that had made a major investment at or before 1990 have not turned profits, seven years down the track.

Table 4: Overview of presence of Australian companies
in Indonesia, 1990-1995 by sector
While the authors say that culture is not a critical factor compared to internal aspects of the organisation, we think they have missed the point somewhat. We would add that while cultural factors may not seem crucial, the ability of an organisation to adapt to cultural factors is certainly critical.

Say for example, cultural traits such as patience in business dealings and reliance on personal contacts. Not surprisingly this ability of cultural adaptation is often aligned to the very  nature of the firm (a flexible committed firm may have the vision and understanding of the market to be patient and know which local partners are trustworthy) thus the importance of the internal factors.

Finally the oft-mentioned importance of business partner selection is also a matter of partner maintenance and both the selection and continued good relations with the local partner are often dependent on an understanding of the cultural norms.

No hard rules for friendships

The importance of personal relationships in business here can never be overstated. But it is also an aspect of business for which no-one can write rules. After all, forming friendships is a gut instinct and if your friend eats you in business dealings then your instincts were definitely wrong! The flipside to this however is that to succeed, you often have no choice but to rely on your instincts.

Gary Phair has worked on consulting jobs in Indonesia for more than 15 years, originally as a chartered accountant with a Big Six firm, and is now  managing director of Brisbane-based Javaust Trading Pty Ltd. he  says that foreign companies are often forced to rely on new found friendships whether they like it or not.

Whilst comprehensive and hopefully water-tight legal documentation of agreements  are the norm in the Australian business environment, this is not necessarily the case in Indonesia, particularly in dealing with non blue-chip companies says Gary.

He relates how an Australian client sought to document a trading arrangement some years ago in a fifteen page but simple draft agreement.

"We spent  a lot of time ensuring that the draft agreement was in the spirit of doing business in Indonesia and was also a  sound and fair basis upon which both parties could proceed. After the inevitable and prolonged waiting period  whilst the agreement was considered by all the directors, the agreement was returned. It had finally been signed but the fifteen pages had been reduced to a three line letter; the terms of which were not immediately cogent!"

Gary says his first reaction was nearly to bang his head on the desk in frustration. Eventually he saw it in an Indonesian light. The clients and himself knew the Indonesians well and trusted them and the opportunity was to the benefit of both parties.

There were three salient lessons.

“The first being that a lengthy Australian style agreement in English will most likely enter the circular filing cabinet here. Second, the deal was still able to proceed despite the insufficient documentation on the basis of mutual trust. Third and probably most tellingly, had the Australian style formal agreement been insisted upon, it probably would have been a deal breaker for the sake of an agreement that would be practically unenforceable in the non-litigious Indonesian business environment," he says.

It is also worthwhile getting the view of Australian businesses involved in setting up manufacturing facilities in cheap labour cost countries like Indonesia. What problems do they come across that say a consultancy or architectural firm would not necessarily experience?

Explain in detail your instructions

At 37, Leo Crohan is already a veteran of the Asian working environment having previously done extended tours of duty in Singapore, Malaysia and Qatar over the past ten years. His  focus  is in the manufacturing and distribution of construction related products - particularly in the oil and gas and energy sector.

He is now resident in Jakarta as Group Marketing Director  for the Perth headquartered Binder Engineering, Australia’s leading manufacturer of proprietary pipe supports and pipe suspension equipment. In Jakarta, Binder with a local partner operates as a 50/50 joint venture company which employs almost 200 people.

Mr Crohan cites communication as being the key to successful management in a developing country environment. "It hasn’t varied dramatically in any of the four Asian countries I have lived," he said, "with the possible exception being that the level of English is not quite as good  in Indonesia."

He gives two simple examples of every day instructions that went horribly wrong. In the first a group of storemen setting up a new distribution centre were told to take everything off the shelves and start again from scratch. This was due to the fact that they had put the heaviest goods nearest to the loaders not the fastest moving goods as would normally be the case.

"When there was no progress three hours later, the matter was investigated," says Leo. "I swear this story is true. The group of storemen were looking for the mark on the wall to start from - the scratch!"

In the second example he gives the example of a 30 year old Sales Manager educated at an American University who is sent by plane to a construction site 300 miles away to establish the status of a very sizeable quotation. Upon his return, he is asked how the trip went. "Great" the young Indonesian beams happily. "As a matter of fact I found out that the Procurement Manger was in our brother's class at school."

Mr Crohan commented  that was interesting but he really wanted to know the status of the tender. "Don’t know," he replied, "it never came up in conversation during our meeting."

According to Leo the moral of the story is to simplify and explain in detail your instructions. Ensure the perceived and understood matches the intended!

"As a workforce Indonesians are just as capable but they require a totally different style of management. They are typically very loyal and obedient which is a big plus but the downside is that they don’t tend to show initiative the way one might expect. Hence the need to fire-proof the instructions to the nth degree."

Andrew James, 38, Technical Adviser to the architectural firm McKerrell Lynch Arkindo has come up with his own rules for corporate establishment and how to play the Indonesian game after six years in this country.

The four main characteristics of business in Indonesia according to Andrew is that it is very personal, there are only friends or enemies, everything is negotiable and as there is no outside protection from government or the laws; you must rely on protecting yourself.

If you play by these rules, then business can be quite free however not all players are allowed into the game and those who don’t enjoy the rules will probably be worn out by the negotiations and the play long before they succeed says Andrew.

This is where cultural adaptation is so important.

"In Australia, we meet each other head on but if you take that approach in Indonesia you will make enemies. As well, there is little respect for intellectual property and little respect paid for hard work here which are two highly prized Australian values."

By comparison, flexibility and shrewdness are perceived as the most important qualities for businessmen in Indonesia according to Andrew. "But for the right type of bule (westerners), the Indonesian game is very exhilarating and sometimes quite rewarding. It is certainly never boring."

Andrews ascribes the lack of respect for hard work as a product of lifestyle as most Indonesians in decision-making positions have been brought up with servants performing all the manual tasks around the house. "The more prepared that the Australians are to step in and personally do the hard, dirty work, the less an Indonesian desires to cement any kind of close relationship."

Everything is negotiable

The counter to the disdain for the hard work ethic is the attitude that everything is negotiable. The tax system is the best example of this according to Andrew. He cited one case where an American construction firm he has worked with was sent a tax assessment for a sum higher than their gross takings for the year. This was subsequently negotiated by the firm’s tax consultant to about 30% of the initial sum.

Nevertheless the firm still felt that to be too high and decided to file an objection with the tax court in Indonesia. They were then summoned to meet with the head tax officer who eventually agreed to await the outcome of the tax court's decision. This process would take some 3-6 years and the firm had to pay some of the tax assessment in the meantime. This was agreed to on a gentlemen's handshake.

Within hours of the American business people returning to their offices, the subordinates from the tax office began ringing and sending official letters of demand that denied any agreement with the head of the department.

The company has subsequently received several visits from tax officials threatening to close their office and numerous requests for a negotiated settlement. The firm is in somewhat of a bind as it feels it cannot agree to a negotiated settlement as there is no surety it will remove their obligations. Furthermore there is the need for constant assessments as to who in the tax office has the real power to affect company operations and who only has the power of intimidation and infringement.

Finally, Andrew has some advice on business prospects in Indonesia and in particular on what seems to be the recent notion in Australia that the money is there for the taking for all those with the guts and determination to set up in Indonesia.

He likens this perception to the idea that a lot of shoestring travellers have that they can buy rough cut gemstones direct from their source in India or Thailand and sell them for a profit back in Australia. It isn't that easy.

McKerrell Lynch Arkindo as an Australian joint venture receives many inquiries from Australians in the building field. "One such case was a Queensland painting contractor planning to establish a business here," says Andrew. They told me that they had the best and fastest painters in Queensland but were low on work. Unfortunately it costs $400-$500 per working day to keep an Australian in Jakarta. Local painters cost $2.00-$2.50 per day. So I said to him that while they may be competitive - as long as they were 200 times as fast as the local guys - I still didn't think that they could wait around for two years until they became knowledgeable about the bidding process."

Australian Service Companies In Indonesia: Learning from Experience
By Gitte Heij and Thorsten Stromback
Asia Research Centre | Murdoch University, 1997

Tuesday, October 01, 2013

Indonesian and Australian soccer: 85 years of tours, friendship and heart-break

Reigning Australian A-League Champions, the Central Coast Mariners, had a disappointing finale to their participation In Indonesia’s inaugural Menpora Cup, an international invitational soccer tournament funded by the State Ministry for Youth and Sport which was played in regional cities Bandung (West Java) and Malang (East Java) between Indonesia’s Persib Bandung, Arema Indonesia, Mitra Kukar, Sriwijaya Palembang and Persepam Madura, the Malaysian U-23 national team, Loyola Meralco Sparks of the Philippines and the Mariners.

Central Coast Mariners v Arema at Malang: "one side was meant to win"

The Mariners made it through the group stage with relative ease but faced home town club Arema in the tournament final in Malang on Sunday 29 September with only a 13-player squad due to the club also having a match commitment in Australia on the same weekend. 

Their opponent, Arema, is owned by the Bakrie Group, a major Indonesian conglomerate, which is also the controlling shareholder in A-League club Brisbane Roar.

According to the Mariners, their Indonesian campaign “came to a controversial conclusion with the team on the end of two highly contentious penalty calls and countless other suspect refereeing decisions as they lost 2-1 to Arema FC in the competition’s Final. St. Kitts & Nevis attacker Keith Kayamba Gumbs converted both dubiously awarded penalties to lift the popular local side to victory in front of 38,438 vociferous supporters at Kanjuruhan Stadion.”

Central Coast Assistant Coach Phil Moss said it was obvious any chance of a Mariners victory would have to come against all odds. “It is clear that only one side was meant to win tonight’s Final – and it most certainly wasn’t us,” Moss told club members.

“We have had a great time in Indonesia - the tournament has been well organised and the Indonesian people have been very friendly - but unfortunately the nature of the referee’s performance tonight leaves us with a sour taste in our mouths,” he said.

"New friendships were forged in Indonesia, with the Mariners able to engage with thousands of supporters personally throughout the tour"
Governance aside, it is unfortunate that the great people-to-people friendship generated by football matches between soccer-crazy Indonesian and sports-mad Australia are rare events, despite the two countries’ close proximity.

And yet, Australian sports contact with Indonesia may have commenced with a football tour in 1928.

The New South Wales British Association Football Organisation received an invitation in 1923 from “a gentleman in Batavia” to send a team to tour Java the following season. However, there was to be a gap of a few years, during which Australians visiting the Netherlands East Indies (NEI) noted “the popularity of Association football with the Javanese.”

In April 1928 a three-month tour of NEI by an Australian national soccer team was confirmed by the Australian Soccer Football Association following an invitation from the Java Football Association.  The squad included players from NSW, Queensland, Victoria and South Australia.

Australia’s early Socceroos proudly flying the flag in Surabaya, 1928
Travelling from 20 June to 23 August, 1928, the Australians played 23 matches, winning 17, drawing four, and losing two. Described as "Australia's first dedicated national sporting team tour of Asia," the Australians played in Makassar, Surabaya, Semarang, Bandung and Ceribon. Fixtures for Batavia were cancelled “owing to the unacceptable conditions proposed by the Batavian League” and four games were played in Singapore. Overall, the Australians reported, they "found the grounds good and the players in Java keen, although lacking in team work."

A highlight of the tour was Australia's 2-1 defeat by an All Java team in Surabaya, described as "one of the first representative matches of the Dutch East Indies national team against another official national team, NIVB having been a national association member of FIFA since 1924."

Team list for the Australia v All Java match won by the home side on 19 Aug 1928

A second tour was announced in July 1931, when the Australian Soccer Association accepted the invitation of the Sourabaya Soccer Association. The squad again included players from NSW, Queensland, South Australia and Victoria, only one of whom had toured in 1928. Travelling from 9 August to 5 October,  1931, the Australians played 13 games - 11 in Java and two in Makassar -  winning nine games, drawing one, and losing three. Australian team official, E S Lukoman, told newspapers he was impressed with the improvement in Javanese football since 1928. "They control the ball better than the average Australian team," he said, "and their passing and position play was excellent."

An Australian national team would not play again in Java until 1967 when the Australian team played a friendly against Indonesia’s Tim Nasional in Jakarta and won 2-0.  In October 1972, Australia beat Indonesia 4-1 in a friendly in Jakarta.  In October 1976, Australia drew with Indonesia in a friendly in Jakarta. In December 1980, Australia drew with Indonesia in front of a 60,000 crowd in Jakarta.

In August 1981, Australia lost 0-1 to Indonesia in a World Cup qualifier in Jakarta, a shock loss that helped put New Zealand into the 1982 World Cup at Australia's expence.  Socceroos coach Les Scheinflug had decided to blood some young players, including David Mitchell, who was later to coach Perth Glory and accompany them on their 2008 program in Indonesia. In August 1990, Australia beat Indonesia 1-0 in a friendly in Jakarta, their last visit to Indonesia for another 19 years. 

In 2005, however, Robbie Gaspar became the first Australian to play professional football in Indonesia when he signed with Persita Tangerang. His subsequent seven year professional career in the country included playing also for Persiba Balikpapan 2006-09, Persema Malang 2009-11 and Persib Bandung 2011-12 and his local popularity grew to over 52,000 followers at his Twitter account, @RobbieGaspar23.

In 2006, two Australian state league clubs, Manly United from NSW and Bulleen Zebras from Victoria,
participated in a Jakarta-based friendly tournament, the Bang Yos Gold Cup. Phil Moss, who was with Manly United recalled “We were treated very well, the tournament was well organised and there were big crowds. It was a fantastic ten days away … The boys at Manly at the time saw what Asian football has to offer, and it was certainly an eye-opener for me as a coach.”

In 2007, the Western Australian state government commissioned Sports Dynamics to investigate the use of sport as a component  of the Western Australian - East Java sister province/state relationship. 

This resulted in the successful ‘festival of football’ played in East Java in June/July 2008, including a sports seminar, youth clinics, the visit of Football West's Premier League representative team to play an ‘international’ against the East Java U-23 (PON) team and the A-League’s Perth Glory pre-season training visit which included matches against Indonesian Super League clubs Persik Kediri and Deltras Sidoarjo. The game between Glory and then Indonesian champion, Kediri, played one week before the start of the new ISL season, was broadcast live on prime-time Sunday evening to a national viewing audience of more than 40 million.

Perth Glory v Persik at Kediri 2008
Then WA Trade Commissioner to Indonesia, Martin Newbery, noted that the football tournament had had more coverage in Indonesian media than any other Western Australian promotion in the country in the preceding 20-years. “I can think of no better way of bringing Australians and Indonesians together than sport where a common language, interest and enthusiasm brings people together and develops friendships and contacts at the personal level,” he explained.

In 2008 Sports Dynamics also assisted the Northern Territory government to establish an annual Under-18 boys’ soccer competition “to further develop community and cultural links” between the Northern Territory and its neighbours - Indonesia’s Nusa Tenggara Timur province and independent Timor Leste. Sponsored for a further three years by Conoco-Philips, the Timor Sea Cup rotated between Darwin, Dili and Kupang until its 2013 program was suspended by the Northern Territory Government. 

Nusa Tenggara Timur v Timor Leste
On 28 January 2009, Australia drew 0-0 with Indonesia in an Asian Cup Qualifying match in front of a crowd of 68,000 in Jakarta.  For the first time the Australian community was mobilised for the game: with assistance from Sports Dynamics the Socceroo coaches – including current  Mariners coach, Graham Arnold - attended an Australia Day BBQ in Jakarta, the Socceroos conducted clinics at a Muslim high school and the Australian International School, and ticketing was arranged for some 500 Australians to sit as a group in the West VIP section of the Bung Karno stadium (introducing the local atmosphere to most of the Australians attending and providing a colorful green/gold section for Indonesian national television).

One year later, Football Federation Australia signed an MOU with PSSI, the Indonesian Football  Association,  aiming to assist the development of coaches, players, referees, grassroots football and women's football and host training visits for Indonesian players, coaches and officials.

As Robbie Gasper has detailed, little direct inter-relationship between the Football Associations of Australia and Indonesia for grassroots development has occurred since, mainly due to the calamitous rupture of the Indonesian football Association and League over poor governance. 

“Some of the things I’ve seen and heard in the last seven years are a disgrace,” he's explained. “Football here is such a powerful tool that a lot of people want to get involved for the wrong reasons. I just want to see people getting involved for the right reasons ... We’re neighbours. There are 240 million people here compared to less than 25 million in Australia. Australia would be crazy not to tap into it, and Indonesia could learn a lot from Australia’s professional practices. Sport breaks down boundaries and football is a great way for Australia and Indonesia to communicate.”

Indeed, Robbie’s own encouragement of more than 20 Australian players to follow him to Indonesia during the period lead him to help establish the Indonesia Players Union, APPI, with the world body FIFPro, to protect the rights of local and foreign players. That important battle continues.

Although currently not resident in Indonesia, Robbie remains a contributor to Australian Sports Group Indonesia ( which brings together Australians dedicated to Indonesian community and grassroots sports, particularly AFL, soccer, rugby, cricket, hockey, athletics and administration. The group is preparing a brief on the Australian sports volunteer experience in Indonesia and its impact on Indonesia-Australia people-to-people relationships.

You are welcome to add further information, anecdotes and corrections in Comments below:

Monday, September 30, 2013

NSW's senior trade and investment mission quietly arrives in Jakarta

A trade and investment mission from Australia's most populous state, New South Wales, has departed from Sydney to Jakarta. Lead by the state's Deputy Premier, Minister for Trade and Investment and National Party leader, Andrew Stoner, the five-day mission commences in Indonesia and continues to Singapore and Malaysia.

“While NSW enjoys good relationships with Indonesia, Malaysia and Singapore, I want to strengthen our ties with these important neighbours,” Mr Stoner said. “My message on this visit is that NSW is open and ready for international business and I will focus on promoting the strengths of our State’s agribusiness sector.”

Mr Andrew Stoner, NSW state Deputy Premier and Minister for Trade and Investment

The first leader of the current NSW Liberal National Coalition administration to visit Indonesia, Mr Stoner will meet with Indonesian government leaders including the Vice Minister of Trade, Dr Bayu Krisnamurthi and "senior business leaders" to "help identify potential new opportunities for NSW agribusiness exporters."

Indonesia, Singapore and Malaysia were all identified as priority markets in the NSW International Engagement Strategy released earlier this year and Mr Stoner noted that Indonesia has "large and fast growing consumer markets" and is "experiencing a shift to modern grocery retailing and greater demand for processed and convenience foods."

The NSW strategy also recommended that the state open its first trade and investment office in Jakarta, capital of Indonesia. A final decision on its implementation is expected by year's end.

See also: Australia's regions accelerate trade missions to Indonesia and official offices (13 Aug 2013)

Wednesday, September 25, 2013

Tasmanian Premier reports successful outcomes to state's mission to Indonesia

Australia’s smallest state, Tasmania, sent its first trade mission in decades to Indonesia on 1-4 September. The multi-sector trade delegation of businesses and organisations was led by Ms Lara Giddings, Tasmanian Premier and state parliamentary leader of the Australian Labor Party.

Events included a business dinner with members of the Indonesian Chamber of Commerce and Industry (KADIN), a breakfast meeting with Indonesia Australia Business Council, industry round tables on remote area power generation, higher education and VETS, a visit to an Indonesian school conducting Skype exchanges with Tasmanian schools, and a function for the Premier to address Indonesian female politicians and administrators about women in politics and advocate Tasmania broadly.

Renewable Energy

Premier Giddings with Vice
Minister for Energy and Mineral
Resources  Susilo Siswoutomo
Ms Giddings and officials from Hydro Tasmania, Entura, and the University of Tasmania, met with Indonesia's Vice Minister for Energy and Mineral Resources, Mr Susilo Siswoutomo, to develop a Memorandum of Understanding between Tasmania and Indonesia on renewable energy.

"This MoU will help us work cooperatively to build the skills and capacity within the Indonesian population needed to address the country's resource and infrastructure challenges," the Premier said.

"The Indonesian Government is prioritising the development of renewable energy sources, including mini-hydro, wind and solar to reduce its dependency on fossil fuels.  This represents an opportunity for Hydro Tasmania, which has demonstrated its expertise in overcoming similar challenges in remote areas across Asia and closer to home on King Island,” she said, adding that the University of Tasmania had internationally recognised expertise in water management and biofuels.

Education and Training

Premier Giddings and the University of Tasmania delegation led by deputy vice chancellor David Sadler also met with Indonesian Vice-Minister of Education and Culture, Prof Dr Ir Musliar Kasim, to discuss a range of issues, including increasing the intake of Indonesian students and contributing to the training of Indonesian educators.

Premier Giddings meeting with  Vice Minister for Education, Dr Musliar Kasim.
Ms Giddings said Dr Kasim, was keen to discuss opportunities for closer engagement between Indonesia and Tasmania. "Currently 25 Tasmanian Government schools are teaching Bahasa Indonesian, with six participating in the Bridge Program, which supports increased cultural awareness.  Dr Kasim was very enthusiastic about increasing the number of Tasmanian schools teaching Bahasa. He was also interested in potential collaborations between UTAS and TasTafe and Indonesian institutions, particularly Andalas University, Padang, which he has previously chaired. He already had an understanding and awareness of UTAS' strengths in areas like aquaculture and scientific research."

A UTAS Alumni Event for former graduates was also held in Jakarta. "Hearing about what these people have achieved in industries from software development, telecommunications and fisheries is inspiring and demonstrates the quality of the University of Tasmania's lecturers and its courses," Ms Giddings said.  "These alumni are ambassadors, not only for UTAS but for Tasmania as a whole."

Freight logistics and transport 

Premier Giddings and Launceston City Council Mayor, Albert Van Zetten, hosted a meeting with Mr Sumadi Kusuma, the founder of Global Putra International, Indonesia's biggest shipping company, and other Indonesian logistics experts.

Global Putra International is partnered with Cosco in China, the world's second biggest transport network group and Mr Kusuma has been invited to Tasmania to advise the Freight Logistics Council on how to address the state's freight problems.

"Mr Kusuma has been involved in shipping across the Asian region for more than 30 years and he has an intimate understanding of the challenges of freight logistics," Ms Giddings said. "Mr Kusuma echoed the advice of our own Freight Coordination Team in identifying the need for a coordinated freight solution, including increasing volumes, as the key to restoring a direct international shipping link.

Mr Kusuma said he was keen to use his networks and connections to work with the Tasmanian Government and the private sector to increase cargo traffic and overcome the impediments to direct international shipping.

Ms Giddings also reported successful meetings with other high ranking Indonesian government officials including the Vice Minister for Foreign Affairs, the Minister for Youth and Sports, and the Secretary-General for Maritime Affairs and Fisheries.

See also: Australia's regions accelerate trade missions to Indonesia and official offices (13 Aug 2013)