21 July 2009

The Governor of Jakarta Special Capital Region (DKI Jakarta) Fauzi Bowo and Chairman of Indonesian Chamber of Commerce (KADIN) MS Hidayat hold a press conference at Jakarta Media Crisis Center on Tuesday (17 July 2009).

The Governor of Jakarta Special Capital Region (DKI Jakarta) Fauzi Bowo said “bomb blast can occur anywhere in the world, for example a bomb exploded in Mumbai, India last year and similar incident happened in London in the previous year. It is important for people of Jakarta to increase their vigilance level by applying community surveillance based on current procedure.”

“Jakarta will recover fast if the authority can reveal the bombing case promptly,” stated the Governor. Fauzi asked journalists to assist police investigation by publishing news according to official statement announced by Indonesian Police at the Media Crisis Center. Furthermore, the governor asked security officials in hotels, shopping malls and public places to check visitors’ laptops.

Meanwhile, Chairman of Indonesian Chamber of Commerce (KADIN) MS Hidayat said ”The terror aimed at damaging the image of Indonesia. I hope Indonesian exports will not be affected by the bombing. However, domestic trading for several consumption commodities is affected. Airlines business is normal, but five-star hotel occupancy rate is slightly declined.”

MS Hidayat explained that KADIN Indonesia had contacted 10 foreign chamber of commerce organizations. He stressed, “It is not true that the bomb blasts were targeted to a group of investors.”

In a media conference attended by dozens of national and international journalists at the Media Crisis Center on Tuesday (21 July 2009), Hidayat explained ”The impact of bombings at the Mega Kuningan is insignificant for national economic condition. There is no major impact on real sector investments.”

Hidayat exclaimed, “If we manage security and political stability seriously, we will receive foreign investors’ trust.” He believes that economic condition will improve. “The occupancy rate of five-star hotels is slightly decline, because their guests move to local hotels,” he added.

Indonesian export value so far has declined due to global economic crisis. The export value in May 2009 reaches US$ 9.26 billion (9.52% increase) compared to April 2009. However, the export value is 28.28% lower than that in May 2008.

The value of accumulative export as of January-May 2009 reaches US$40.74 billion, a 29.24% decrease if it is compared to January-May 2008 export. Non-oil and gas export valued at US$35.05 billion or decreased by 21.19% compared to the export in a similar period in the previous year.

Hidayat emphasized, “Whether the blast made major or minor impact, for sure Indonesia’s credibility has been damaged. Credibility can be restored as far as how government and law enforcer handle the bomb blasts.”

The reaction to Jakarta bomb blasts is not as negative as the reaction that appeared after the Bali bombing and bombing occurred in front of Australian Embassy. The impact of the recent bombings on trading in the stock exchange and on currency is less significant.

It was reported from the Indonesia Stock Exchange on Tuesday (22 July 2009), that a massive stock buying was triggered by positive sentiment on global market index. This massive buying improves share price index to its highest level for the past 10 months.

Composite stock price index (IHSG) increased by 40.2 point or 1.91% up to 2146 level. The LQ-45 index increased by 7.73 point or 1.88 percent up to the level 419.43 and Kompas 100 increased by 9.06 point or 1.76% up to the level 522.68. They are the highest since September 2008.

Today’s market trading is attractive, the stock volume which has been traded is 5.11 billion or around Rp 5.425 trillion. This value is considered attractive compared to the average value of transaction in Indonesia Stock Exchange for the past month, which was around Rp 3.5 trillion.