Jokowi delivers Zelensky’s message to Putin, urges dialogue 

  Indonesian President Joko Widodo said in Moscow on Thursday (June 30) that he delivered a
  message from Ukrainian President Volodymyr Zelensky to Russian leader Vladimir Putin. 

  Mr. Putin hosted Mr. Widodo more than four months into Moscow’s offensive in Ukraine, as
  Russia seeks to pivot toward Asia and Africa following the onset of unprecedented Western
  sanctions. 

  Indonesia holds the rotating presidency of the Group of 20 (G-20) this year and is preparing to
  host a summit in Bali in November. 

  “I conveyed President Zelensky’s message to President Putin,” Mr. Widodo said after talks with
  the Kremlin chief in comments translated into Russian. 

  Mr. Widodo said he expressed his “readiness” to help start “communication” between the two
  leaders. 

  He did not provide further details, and neither side said what was in the note. 

  Mr. Widodo was in Kyiv on Wednesday before heading to Moscow to meet Mr. Putin, who on
  Feb 24 sent troops into pro-Western Ukraine. 

  “Although the external situation is still difficult, it is still important to move towards a settlement
  and open dialogue,” Mr. Widodo said in Moscow. 

  He said that his country would like “the war to end soon”. 

  “I call on all world leaders to revive the spirit of cooperation,” Mr. Widodo added. 

  Jakarta has come under Western pressure to exclude Mr. Putin from the G-20 gathering after
  announcing in April he had been invited. 

  Ukraine’s Zelensky told Mr. Widodo on Wednesday that he will attend the upcoming G-20
  summit in Bali depending on who else is attending. 

  Mr. Putin on Thursday praised his talks with Mr. Widodo as “productive”. 

  “I am convinced that the agreements reached today will further strengthen the
  Russian-Indonesian partnership,” Mr. Putin added. 

  The Indonesian President said global food supply issues would not improve if Russian fertiliser
  and Ukrainian wheat is unavailable, and said he urged Group of Seven (G-7) leaders to ensure 
  sanctions on Russia do not affect food and fertilizer supplies. 

  On his part, Mr. Putin denied that Moscow was blocking Ukrainian grain exports and questioned
  the impact of missing Ukrainian agricultural goods on the world food market. 

  "We do not prevent the export of Ukrainian grain. The Ukrainian military has mined the
  approaches to their ports, no one prevents them from clearing those mines and we guarantee
  the safety of shipping grain out of there," Mr. Putin said, speaking alongside the visiting
  Indonesian President. 

  He repeated Russia's assertion that Western sanctions are to blame for problems on the global
  food market and rising prices. 

  Mr. Putin also said he wanted Russia to maintain its position as the world's largest wheat
  exporter. It currently accounts for around a fifth of global sales. 

  Source: The Straits Times 

  Indonesia Central Bank in no rush to hike rates
 as inflation hits 5-year high 

  Indonesia's central bank is in no rush to hike interest rates, its governor said on Friday, even as
  June consumer prices rose at the fastest pace in five years, topping forecasts and breaching its
  target range amid a surge in food prices. 

  June's annual inflation rate accelerated to 4.35%, the highest since June 2017 and above the
  4.17% forecast in a Reuters poll. Last month's figure was 3.55%. 

  Bank Indonesia's (BI) target range is 2% to 4%. 

  However, the annual core inflation rate, which strips out government-controlled and volatile
  prices, was below market expectations at 2.63% in June. The poll had forecast a 2.72% rate,
  while May's rate was 2.58%. 

  BI Governor Perry Warjiyo said the data set showed low core inflation and low inflation of
  government-controlled prices, due to large subsidies keeping some energy prices unchanged. 

  "Core inflation is relatively low, so that it provides room for flexibility for us to not be in a rush to
  raise interest rates," he told a parliamentary hearing, repeating a pledge to keep interest rates
  at record low until BI sees signs of fundamental price pressures. 

  BI, one of the world's least hawkish central banks, has said it would focus more on the core
  inflation rate, instead of the headline figure, to determine the pace of its post-pandemic policy
  normalisation. 

  Data showed the rise in inflation was primarily driven by rising prices of chilli, shallots, eggs, and
  transportation tariffs. 

  Margo Yuwono, head of Indonesia's statistics agency, said high global prices of wheat, sugar
  and soy had so far had limited impact on domestic inflation. While flour and noodle makers had
  seen costs rising, they have not passed this on to consumers, he said. 

  Bank Permata economist Josua Pardede said any change in BI's policy stance would likely be
  driven more by movements in the rupiah currency , which has been under pressure since June
  due to capital outflows linked to the U.S. Federal Reserve monetary tightening. 

  "Commentary in the run-up to the July meeting will be scrutinised for signs of change in stance
  in light of narrowing US-ID rate differentials and (an) under pressure currency," DBS' economist
  Radhika Rao said. 

  Source: Reuters 

  Indonesia may not meet EU demand for coal 

  Indonesia may be unable to meet increasing demand for coal from European countries that
  are looking to stock up on the dirty fuel source as they reduce energy imports from Russia.  

  Spain, Italy and the Netherlands have joined Germany in exploring options to purchase a larger
  amount of coal from Indonesia, the Energy and Mineral Resources Ministry has said.  

  Previously, Germany was said to have asked for around 150 million tons of coal from Indonesia,
  but the ministry said there was no formal agreement to that request. 

  India, which is Indonesia’s second-largest coal export destination, has also approached
  Indonesia to acquire more coal to meet its domestic needs.  

  Indonesian coal shipments to Germany, Netherlands, Spain, Italy, Poland and Switzerland have
  increased tremendously over the first five months of the year compared with the same period of
  last year, Statistics Indonesia data show.  

  Energy and Mineral Resources Ministry special advisor Irwandy Arif expressed doubts that
  Indonesia could meet additional demand from Europe, arguing that many producers were
  having a hard time increasing their production due to extreme weather and difficulties in
  obtaining mining equipment.  

  He pointed out that producers had met only 41 percent of their full-year output target by the end
  of May, implying a possible shortfall in this year's production.  

  “We can't necessarily increase our production all of a sudden. We can’t,” Irwandy told reporters
  on June 24, adding that Indonesia had already increased its coal shipments prior to this
  additional demand. 

  European countries have been scrambling to source coal from many exporting countries to
  secure their energy needs amid lower imports of coal and gas from Russia.  

  This month, Russia's Gazprom reduced gas supplies sent to Europe through the Nord Stream I
  pipeline, citing the delayed return of equipment being serviced by Germany's Siemens Energy
  in Canada. Gazprom CEO Alexey Miller said sanctions were preventing the company from
  getting the equipment back, Reuters reported, while Germany dismissed that explanation as 
  "unfounded".  

  Indonesian Coal Mining Association (APBI) executive director Hendra Sinadia told The Jakarta
  Post on Wednesday that the government had given the green light to increase production amid
  surging EU demand. Some mining companies were seeking to boost their production plans by
  undisclosed amounts, he said.  

  However, he added that there was still no guarantee that producers could meet EU demand.  

  “This is very positive for us, but that does not mean that we can provide all of the EU's needs to
  replace supply from Russia,” Hendra said, adding that it would be subject to price negotiations
  apart from talks on the amounts and quality demanded by the EU.  

  Hendra said producers could not increase their output to such a large degree in a very short
  time. Meanwhile, bad weather had made it challenging even to meet current production
  targets.  

  The government has set a 2022 coal production target of 663 million tons, but producers
  expect there will be a shortfall on that figure at the end of this year.  

  Moreover, most Indonesian coal does not meet the specifications required by EU countries,
  namely to be of high calorific value and contain little sulfur.  

  A. Rizqi Darsono, who heads the permanent committee of coal and mineral resources at the
  Indonesian Chamber of Commerce and Industry (Kadin), urged local producers to seize this
  opportunity to take advantage of rising demand and surging prices, citing the benefits of
  foreign exchange income and government revenue.  

  “Firms among our members have been trying to increase their production. Some have
  reported that they have received requests directly from Germany,” Rizqi told the Post on
  Wednesday. 

  Meanwhile, Adhityani “Ditri” Putri, executive director of energy transition NGO Indonesia Cerah,
  said on Wednesday that European backtracking on coal would be temporary. She pointed to
  Germany, which pledged to retain its commitment to phase out coal use by 2030, implying the
  country would remain on track despite the higher coal demand.  

  “We are not worried that it will affect European countries’ commitment to the energy
  transition,” Ditri told the Post, noting however that the EU’s higher coal use would result in a
  spike of greenhouse gas emissions this year.  

  Her concern was larger with regard to the domestic situation, Ditri said, arguing that whenever
  coal production was raised drastically, it would not come back down easily. She also said she
  feared that higher EU demand could lead to an expansion of mining activities in Indonesia. 

  Source: The Jakarta Post