Indonesia to Use Its Benchmark Coal Price for Transactions from March 1

Indonesia will start using its government-set benchmark coal price as the floor price for transactions starting next month, a senior official at the Energy and Mineral Resources Ministry said on Wednesday. 

Indonesia currently uses the government benchmark price, known as the HBA, to calculate royalty fees for coal miners. 

Energy Minister Bahlil Lahadalia said earlier this month the government would require coal companies to use the HBA as the benchmark for global transactions, as the government seeks to have more control over the prices of the nation's coal. 

"It will be implemented from March 1," ministry official Tri Winarno said in a text message to Reuters, without elaborating further on the details of the policy. 

According to an online briefing with coal miners, ministry officials said the government will set the prices twice a month under the new HBA scheme to reflect more updated pricing conditions, instead of the current practice of once a month. 

The government will set the new prices every first and fifteenth day of the month, officials at the briefing said. 

The government sets the HBA based on recent prices reported by coal miners to the government for their royalty fee filings. 

In February, the government set the HBA prices between USD 34.38 per metric ton for the lowest grade and USD 124.24 for the highest grade. 

Transactions for the so-called domestic market obligations will continue to be capped at USD 70 per metric ton for electricity needs and USD 90 for some industry needs, according to the briefing with miners. 

The exporters are allowed to honour prices stated in their ongoing long-term contracts with buyers, but the government expects companies to make adjustments should their contracts allow it. 

Traders have said previously that buyers and sellers would likely prefer to continue using the ICI coal price index, as the HBA often lagged in data and timing. 

The government is finalizing details on the supervisory mechanisms for the policy and sanctions for those violating the rules. 

Source: Reuters 

Govt to Issue Bonds for 3 Million Homes Program, Sri Mulyani Says 

The Finance Ministry has announced a new housing bond to help finance the government's 3 million affordable homes program as a "modification" of the FLPP mortgage facility launched in 2021. 

Finance Minister Sri Mulyani Indrawati has announced a plan to issue an affordable housing bond to help finance President Prabowo Subianto’s program to build 3 million homes, aiming to increase homeownership among low-income earners (MBR).  

The funds raised from “the housing bonds will be allocated specially to finance housing for MBR. This is a modification of the FLPP mechanism that will be scaled up,” Sri Mulyani told a joint press conference on Thursday at the Finance Ministry.  

The FLPP, or housing finance liquidity facility, is a home ownership credit (KPR) scheme for low-income earners launched in 2021 by the Public Works and Housing Ministry, now the Public Housing and Settlements Ministry, and state-owned banks, according to Antara. 

Under the new bond scheme, the government is seeking to expand the FLPP mortgage facility to reach more beneficiaries and achieve this year’s target of 220,000 housing units. 

According to the Finance Ministry, the government has allocated IDR 18 trillion (USD 1.1 billion) for the FLPP scheme and IDR 1.9 trillion in state capital injection for state-owned PT Sarana Multigriya Finansial (SMF) to offer fixed-rate second mortgages at 5 percent for a 20-year term. 

“We will continue to develop a variety of creative financing to [not only] maintain fiscal discipline in the state budget, but also remain responsive to and capable of supporting other sectors, not only housing,” the minister said. 

Sri Mulyani added that the government would be collaborating with Bank Indonesia (BI), the Financial Services Authority (OJK) and state-owned banks on utilizing credit facilities for the affordable homes program.  

“We hope this will increase demand capacity for people who want to buy houses with the MBR facilities or commercial ones,” she said.  

BI Governor Perry Warjiyo, who also joined Thursday’s press conference, reiterated the central bank’s plan to raise funds for the housing program by increasing liquidity incentives for banks in the housing sector to IDR 80 trillion.  

BI would also support the affordable homes program by buying the Finance Ministry’s housing bonds from the secondary market, he said.  

“We have spoken with the Finance Minister [to ensure] that the funds can be used not only for debt swaps for government bonds maturing during the [post-pandemic] period, but also for financing housing programs,” Perry added.  

At the same event, Mukhamad Misbakhun, who chairs House of Representatives Commission XI overseeing financial affairs, also expressed his support for the plans to finance the government’s housing program.  

Misbakhun noted that details on the financing scheme would be determined at a forthcoming meeting between Commission XI, the housing and finance ministries and the central bank.  

Prabowo’s flagship housing program aims to build 1 million urban houses and 2 million rural houses each year to provide affordable homes and reduce poverty.  

The program has been allocated an initial budget of IDR 5.2 trillion for 2025 under the housing ministry, but the figure was reduced to IDR 3.4 trillion during the government’s recent efficiency measure. 

The ministry has been seeking funding for the housing program from other financing sources, such as the World Bank and countries including China, India, Qatar, Singapore and the United Arab Emirates.  

In December, housing minister Maruarar Sirait said the state budget alone would be insufficient to reach the funding target, adding that the ministry’s allotment was only enough to cover less than 10 percent of the estimated IDR 48 trillion. 

Source: The Jakarta Post 

Indonesia, Switzerland Cooperate on Dual-system Vocational Education 

Indonesia and Switzerland have teamed up to implement a dual-system vocational education program, which combines classroom learning with on-the-job industrial experience, to enhance the quality of human resources. 
 

The collaboration is being carried out by Indonesia's Industrial Human Resources Development Agency (BPSDMI) and Switzerland's State Secretariat for Economic Affairs (SECO). 

Minister of Industry Agus Gumiwang Kartasasmita said on Thursday that vocational education and training have been carefully prepared to meet and anticipate industry needs in line with technological and economic developments. 

"Therefore, we continue striving to ensure alignment with the business and industrial sectors, not only for the present but also for future industrial development," he said. 

The cooperation comprises two phases. The first phase was completed in 2022 but was extended until 2024 because of the COVID-19 pandemic. The second phase will run from 2024 to 2027. 

BPSDMI head Masrokhan said the second phase of cooperation can be expanded to other educational units under the Industry Ministry, allowing broader adaptation in national educational development. 

He explained that the Ministry of Industry oversees 13 vocational higher education institutions —11 polytechnics and two community academies— along with nine vocational high schools and seven industrial education and training centers. 

These institutions play an active role in developing high-quality industrial human resources, he noted. 

"The ministry's vocational education units have also been implementing the dual-system vocational education model, which has proven to be an attractive option for students and highly effective in producing work-ready industrial professionals," Masrokhan said. 

Source: Antaranews