AmCham Update
AmCham Update Vol. 4 #29
Mayo Clinic Opens First Office in Indonesia, IPEF to Strengthen Member Economies, Jokowi Says Use of Local Not Foreign Payment Systems, Crackdown on Illegal Used Clothing Imports
Mar 17, 2023

IPEF Will Strengthen Partners’ Economic Sustainability: Airlangga 

The Indo-Pacific Economic Framework (IPEF), which is holding its second negotiating round in Bali from March 13-19, is expected to strengthen partner countries’ economies, said Coordinating Minister for Economic Affairs Airlangga Hartarto, whose ministry is hosting the event.

In a virtual meeting with the United States Trade Representative (USTR) Ambassador Katherine Tai, Airlangga said he hopes IPEF can result in new ideas and innovations to further encourage international trade. Ambassador Tai said she would attend the Ministerial-level IPEF meeting in May this year.

The meeting was also used as a platform for USTR to convey US government concerns, such as over the implementation of the Commodity Balance (NK) system for imported products, and regulations on customs for intangible goods.

Airlangga said the government remains open to suggestions from different stakeholders on such issues.

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Mayo Clinic Opens First Office in Indonesia

The US-based Mayo Clinic, one of the leading hospital groups in the world, has opened an International Referral Office in Indonesia, its first such office in Southeast Asia. The office was formally opened on March 16 with a welcome reception at the St Regis Hotel in Jakarta.

In addition to referrals for patients who may wish to go to Mayo’s hospitals in Minnesota, Arizona and Florida, Mayo is also consulting with some Indonesian government hospitals including Ciptro Mangunkusumo Hospital on patient care and other issues.

Rumah Sakit Pusat Pertamina (RSPP) has also joined the Mayo Clinic Care Network, a group of carefully vetted health care organizations with special access to Mayo Clinic's knowledge and expertise.

Indonesian Vice Minister of Health Dante Saksono Harbuwono, spoke at the event and said he hoped circumstances in Indonesia would change to allow more hospitals to form partnerships with Mayo.

One of those circumstances, of course, is that foreign doctors are still not allowed to practice medicine in Indonesia. While health care is open for foreign investment under the Job Creation Law, AmCham has long advocated easing restrictions on foreign doctors in order to facilitate both investment and greater medical expertise in the country.

AmCham Indonesia also attended the opening of the Mayo office. “It is our hope that with reforms coming to the healthcare sector we will one day soon see not only Mayo but other leading international hospitals working closely with Indonesian professionals to bring better patient care to the country,” said AmCham Managing Director A Lin Neumann.

“Personally, I am very happy to see Mayo take this step,” Neumann added. “It is a vote of confidence in Indonesia’s future.”

The non-profit Mayo Clinic dates back to the family medical practice of Dr William Mayo, and his sons Dr Will and Dr Charlie, as they were known, in Rochester, Minnesota, in the 1860s. It is ranked as the No. 1 hospital in the United States by US News & World Report magazine.

The hospital is a center for research, treatment and education and is a leader in numerous medical fields.

Jokowi Calls for Support of Local Payment Systems, Not Foreign Ones

President Joko Widodo has urged central and regional government agencies to use domestic payment systems and ditch foreign ones. President Widodo especially referred to credit payments which are facilitated by foreign payment networks such as Visa and Mastercard.

President Widodo said he was concerned about problems using foreign payment systems during global uncertainty, and cited the example of problems endured by Visa and Mastercard after the US imposed sanctions on Russia following its invasion of Ukraine.

However, the absence of any local credit cards makes this problematic, and while Indonesia launched its National Payment Gateway (GPN) in 2017, it is limited to debit card payments, with credit card use yet to be facilitated.

It is technically possible to develop a credit card by a local principal, but it would require massive investment, said Indonesian Credit Card Association (AKKI) Executive Director Steve Marta. He said he agreed local credit cards need to be developed, but is opposed to the idea of limiting the choice to only domestic, ditching the advanced technology and security offered by multinational payment principals.

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AmCham Cares: HP

HP is working with Project STOP, which now operates in three coastal provinces in East Java and Bali. Project STOP works with cities to create effective waste management systems that eliminate leakage of plastics into the ocean. It creates circular waste management systems and brings waste collection to more than 170,000 people.

It has also created stable jobs for 210 waste workers. With such an elaborate waste management system, Project STOP prevents nearly 10,000 tons of waste, which consists of 1,118 tons of plastic from polluting the environment. HP has completed the construction of five material recovery facilities, increasing Project STOP’s processing capacity to 150 tons/day.

The key objectives of the program are:

  • Reducing waste leakage into the environment by providing affordable, reliable and formal waste collection to all citizens
  • Promoting resource efficiency and circularity that transform waste into feedstock for recycling
  • Achieving economic sustainability
  • Benefitting the communities through improved public health and creating permanent job opportunities in the waste and material sorting sectors.

Scaling up waste management and recycling solutions is challenging in Indonesia because of the financing required to build and operate waste management systems, and the need for large-scale community behavior changes and skills development among waste system operators.

Organic waste and some types of plastic waste (particularly multi-layer plastics made from multiple types of plastics) have very low value for recycling or composting. So far, the project has achieved participation rates ranging from 50 percent to 87 percent depending on the location, and on average slightly more than 30 percent of non-organic recyclable materials are sent for recycling across all partner communities.

Project STOP’s impact was made possible through invaluable support from Indonesia’s national and local government agencies, including the Ministry of Environment and Forestry, the Coordinating Ministry for Maritime Affairs, the Ministry of National Development Planning/National Development Planning Agency, the Ministry of Public Works and Public Housing, and the Banyuwangi, Pasuruan and Jembrana governments. HP said it is proud to be taking part in this green project.

ADB and World Bank Talk Business Cooperation With AmCham

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AmCham Indonesia held a roundtable discussion with the Senior Commercial Officer and US Commercial Representative to the Asian Development Bank (ADB) Hanes Roberts and Senior US Commercial Liaison and Advisor to the US Executive Director at the World Bank Danica R Starks, on March 16. The session discussed financing opportunities from the two multilateral development banks (MBD), along with their priorities in 2023.

Hanes said ADB has been pushing more support on infrastructure, transportation, and the health sector. He said Indonesia is projected to receive $7.9 billion in sovereign ordinary capital resources (OCR) commitments and from the Asian Development Fund (ADF) between 2022-2024, and that ADB is open for financing proposals.

Danica spoke of the number of financing schemes the bank already has under its belt, along with details on the World Bank’s new procurement framework. She also encouraged the private sector to utilize MBDs in supporting beneficial projects.

The session wrapped up with a question and answer session, where participants gathered more insights on the application process, along with further details on project financing. 

President Orders Crackdown on Illegal Used Clothing Imports

President Joko Widodo has ordered a crackdown on the illegal import of used clothing as massive black market trading is hurting the domestic textile industry.

The import ban is already in place under Trade Minister Regulations 51/M-DAG/PER/7/2015 and 18/2021, but President Widodo said illegal imports were still rampant and he had already ordered related institutions to track down the illegal importers, resulting in a number of arrests.

Minister of Trade Zulkifli Hasan said that the crackdown of illegal importers will not affect the exclusively domestic trade of second hand clothing by Indonesian companies, known as thrifting.

However, Minister of Cooperatives and Micro, Small, and Medium-sized Enterprises (MSMEs) Teten Masduki said he will urge e-commerce platforms to halt sales of secondhand clothes.

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Member Announcement: ERIA

ERIA's Regional Knowledge Centre for Marine Plastic Debris has created the Private Sector Platform, which showcases business practices of private companies in the Southeast and East Asia region which contribute to the reduction of marine plastic debris.

ERIA: the Economic Research Institute for Asean and East Asia, invites you to join this initiative and share your efforts to contribute to healthy oceans in our region. Please visit the platform page here: or contact ERIA’s team if you have any questions.

New Indonesia-US Agreement on Clean Energy Cooperation

The Indonesian and the US governments signed a memorandum of understanding (MoU) on the Indonesia-US Clean Energy Working Group on March 16, replacing the MoU Power Working Group signed back in 2015. The MoU was signed by Secretary General of the Ministry of Energy and Mineral Resources Rida Mulyana and Assistant Secretary of Commerce and Director General of the US and Foreign Commercial Service Arun Venkataraman.

The new MoU will support Indonesia's electrification and electricity development goals, with an initial focus on helping it achieve 23 percent of renewable energy in 2025 and net-zero emissions (NZE) in 2060 or sooner.

The areas of cooperation in the MoU are small modular reactor (SMR) technology, cyber security, carbon capture and utilization storage (CCUS), microgrids, energy storage, generator efficiency, bioethanol, and geothermal. It also aims to support more investment and job creation, especially between Indonesia and the US.

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Now is the Time to Join AmCham!

Now is the Time to Join AmCham!

We offer a full slate of meetings, events, and information for our community. But we can only do this through the support of our members. If you are not yet an AmCham member, please join now.

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Stay well

We urge you to send us press releases and other information that we can pass on to the broader AmCham community. If you have items of interest, please email material to [email protected]. Follow this link to information provided by the US Embassy

Stay safe, call a doctor if you have a high fever, cough, or difficulty breathing. Stay healthy above all else.

AmCham Update is AmCham's regular newsletter on developments related to the pandemic crisis and other issues in Indonesia. It is edited by AmCham Managing Director A Lin Neumann and written by the AmCham Staff. Paul L Goddard

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