Quo Vadis the Low Cost Car Mass Productions?

A big controversy arises when the government launches a policy supporting the mass production of low cost green car (LCGC). Such cheap cars are classified as the ones which consume one liter for 28 kilometer-distance, 60 percent local contents and the selling price below Rp 75 million  (the US $6,800).

Just a couple of days after launching, almost 18,000 cheap cars have been sold out where most of the buyers are those who live in Jakarta and nearby cities. Low and middle-class people are eager to buy such cars as they cannot afford to buy a normal car which price beyond their purchasing power and buy motorcycles instead.

Now having such a low price car available, some of them may convert from riding motorcycles to cheap cars. The haves may also buy the car as a second [or higher] vehicle especially for their kids.

The number of cars in Indonesia compared to its population is among the lowest in the world. The availability of the LCGC will certainly increase the car population in Indonesia. Huge investment up to US$ 3.5 billion is required and it might absorb thousands of workers to fabricate the cars.

Definitely the LCGC mass productions will give a positive impact on the country economy as they improve the quality of the private transportation mode in term of fuel saving, transportation efficiency as compared to bigger and expensive cars, the condition of transportation mode especially for those using motorcycles and, last but not least, the environment.

Isn’t that the people car (“mobil rakyat”) that the country is longing for? The car which is not exclusively for the haves but also for middle and lower class? Of course, to become a national people car, it is hoped that at the latest stage the local content  would be close to 100 percent.

At everybody’s surprise, the launching of such LCGC has got various negative reactions. Most of the reasons that the opponents put forward are related to the traffic density. They are afraid that the traffic will be stagnant as the infrastructure would not be able to afford the additional amount of vehicles caused by the LCGC.

Under such a mindset, Jokowi, the popular Jakarta Governor, sent a letter to Vice President calling for the postponement for the sales of LCGC in Jakarta. Even some other prominent public figures have asked for the reduction of such people car mass productions.  

Certainly Jakarta is not Indonesia. In many other cities in the country, one may count the vehicles that run on the road. After twilight, the roads in many small cities are almost deserted. Out of around 60 million families in Indonesia only 10 percent possess passenger cars which means that in our country one car is for 40 people, much lower than the ratio in developed countries which is around 1 : 3.

How come that we should be against the relatively poor people for having a little comfort by possessing LCGC replacing their motorcycles in favor of the relatively rich people enjoying their “luxury” cars? Shouldn't we  have an opposite standpoint by encouraging people to have LCGC and imposing the luxury car (more than 3000 cc) usage limitation, by for example allowing them to circulate only beyond the office time?

The postponement of the cheap car mass productions will be a blunder as it will cause Indonesia suffer a big loss, as by 2015 any ASEAN countries under AFTA can easily export their cheap cars into their neighboring countries. They have kept eyes to take any opportunities to market their cheap cars here and certainly will establish their sole agents in our country selling their home-made cheap car.

Fortunately, the Minister of Industry holds firm his standpoint and pointing out that the LCGCs are not merely on sales in Greater Jakarta but will be distributed in 500 other cities. Quo vadis the LCGC mass productions? Will it give beneficial for the country or curse?

Folks, it is now you to make up your mind. 

Hoping that you have the right opinion. 

Oil Palm Plantations, the Indonesian Wealth and the World View Controversy

The Indonesian middle class increased significantly from 89 million in 2003 up to 134 million in 2012, more than half of 237 million of Indonesian people. Such 45 million of middle-class increase is undoubtedly a result of the socio-political stability enjoyed by Indonesian people within the corresponding 10 year-period.

The value of money spent by the Indonesian middle class is fantastic. The annual spending in the corresponding year for clothes and shoes, household articles, transportation  and abroad was the US $ 12 billion, US $ 20 billion, the US $ 24 billion and the US $ 6 billion, respectively.

Some of the causal factors which make such significant progress among other the mass use of motorcycles as a relatively cheap mode of transportation, massive use of mobile phones as the means of effective communication, massive people mobility within the country thanks to low-cost air transportation, massive exploitation of coal mining and, last but not least, the extensive expansion of oil palm plantations.

Out of 200 million hectares of the country’s lands, 9.3 million hectares have been converted to oil palm plantations. In 2012 the output of crude palm oil (CPO) was 23.5 million tons, absorbing a direct workforce of around 2.8 million people, which put the country into the world top CPO producer. The CPO export was 16.5 million tons gaining foreign exchange up to US$ 20 billion.

The palm oil industry employs approximately 2.8 million people directly on the plantation, 1.6 million of whom are small planters, involving 3.6 million people as family members of the employees who work in the plantation companies  enjoying benefits and facilities provided by the company they work in. Most of the small plantations held by the farmers yield low productivity, only 2.5 tons of CPO per hectare as compared to 4.8 tons per hectare of that of state-owned company.

Globally Indonesian CPO production is 45% as compared to Malaysia, 42% and both countries absolutely dominate the world CPO production. However, more than half of the Indonesian oil palm plantation is owned by neighboring countries’ companies which give less salary to the local labors compared to those working in their native countries. As such they get more benefits for having access to both fertile land and cheap labors, thus morally obliged to give more welfare to their local workforce.

The oil palm plantation can be the pioneer to boost the development in remote areas. The opening of the plantations has led to the construction of roads and bridges to facilitate transportation. More people came to the spots and new schools were constructed.

Expansion of new oil palm plantations on an ongoing basis will be able to absorb continuous labors. Each hectare of mature oil palm plantations takes 0.2 man-days. If half a million hectares of new plantations could be annually developed nationwide, the annual minimum amount of labor that can be absorbed is 100,000 or 40 percent of the new workforce entering the labor market.  

The oil palm plantation if cultivated in the degraded, barren areas could become the solution to the reforestation where the growth of oil palms change the area into the greenery spot. The oil palm plantation is able to absorb carbon mono-oxide, the same amount of man-made secondary forest can do. 

However, a lot of NGOs do not agree with this, saying that the opening of a new plantation is frequently followed by a hostile takeover of local people’s land. They argue in addition, that an oil palm absorbs water at the amount of 20 liters per day, reducing the earth water supply. An oil palm can absorb only one part of carbon mono-oxide but releases 7 parts bigger than that, causing the greenhouse effect even worse. Exaggerated worrisome?  Yes, we may suspect that the underlying of such black campaign against CPO is, in fact, the desperate competition between the vegetable oil they produce and CPO which may be produced abundantly in tropical lands. 

Even some big foreign food and toiletries companies boycott Indonesian CPO accusing the Indonesian businessmen for having violated the cultivation principles in accordance with Roundtable on Sustainable Palm Oil (RSPO). Many European buyers, absorbing 9% of Indonesian palm oil export, still, need RSPO certificate which put Indonesian farmers into trouble as they have to spend extra fund for such administrative fulfillment.

Another issue that concerns Indonesia as the big CPO producer is that the CPO price is stipulated in Rotterdam, Netherlands, albeit the small European market share. There is an idea to establish Indonesian Sustainable Palm Oil (ISPO) as an alternative to RSPO, which may be compared to OPEC Crude price as against posted price in the case of the crude oil market in the 1970s.

To protect the local and indigenous people, whose lives are depending on the forest products, from a hostile takeover by companies granted the plantation area, the government prepares a bill to exclude the customary land from state land classification. The government should encourage big companies to closely cooperate with small partners in a mutual benefit scheme. 

Simple Elements that Make Indonesia Grow

Amid the economic recession experienced by developed countries which slow down their economic growth hampering the global trades, Indonesia amazingly sustains its economic growth well above the average of 6%. 

Within the region, the size of the Indonesian economy in term of gross domestic product (GDP) reached 42% that of Asean countries. Coupled with the growing Indonesian middle economic class with the annual income up to US$ 4,000 reaching over 50 million people, the purchasing power of Indonesian people are significantly increasing. 

What are the driving forces that make Indonesian economic so resilience? There should be, for sure, something fundamentals which are overlooked by most people including the policy-makers i.e. the mobility and intense communication among the people that make them fluid and dynamic. 

Along with the advance of the technology which is appropriate for the big and vast country like Indonesia such as more efficient and cheap motorcycles, effective and affordable mobile phones and low-cost wide-body carriers that are capable to massively transport people across the archipelago boost the national economic growth without due expense to the government budget. 

The statistical data show that in 2011, there were around 68,8 million motorcycles and 9,5 million cars distributed all over Indonesia, aside from 2,3 million buses and 4,9 million trucks. Considering the Indonesian population is around 238 million then there are about 3.5 motorcycles per capita on top of passenger cars and buses. This means that every family in Indonesia possesses one motorcycle. If the trend of increasing motorcycle use continues, the short-distance public transportation will soon cease to exist. 

The traffic jams caused by motorcycles in the big cities which most people are blaming to are not the portrait of the traffic condition within the whole country. In rural areas, this kind mode of transportation is still scarce restricted by peasants' low purchasing power. The traffic problem in the metropolitan cities cannot and shall not be used as a barometer to restrict the use of motorcycles within the country.

The positive upshot of people mobility is speeding up by the tremendous increase of mobile phones ownership among the people throughout the archipelago which recently reach around 250 million. This means that every person in Indonesia, babies included, possesses one mobile phone. Indonesia ranks as the biggest four after China, India, and the USA. However, in term of the number of mobile phones per capita, Indonesia slightly leaves China, India, and the USA behind.

In term of money circulation which drives the economic dynamics of the country, the figure is very significant. Indonesian people are very talkative spending on average around Rp 50,000 per capita per month for pulses or around Rp 150 trillion annually, equivalent to one-tenth of the national budget. 

This dynamic pace is further amplified by the low-cost carriers (LCC) which last year was capable to carry 50 million passengers out of 66 million total air passengers. The market growth of LCC aviation is in average 18% per year, passing over the overall national airlines market growth averaging 16.3%. It is expected that in 2015, LCC passengers will reach 80% or 73 million out of the total 90 million passengers.

However, there should be an extra effort to overcome the infrastructure shortfall. The tremendous increase of the passengers is not matched by the improvement of the runways in many airports outside Java to accommodate wide-body carriers such as Boeing 737. Even Soekarno-Hatta airport which was designed for facilitating 22 million passengers annually now are overloaded by around 52 million passengers.

Low-cost carriers help accelerate the economic growth as people mobility across the archipelago is enhanced, breaking through the distant barrier that hinders the inter-trading across the country. One of the good solutions to break the frontier areas isolation is the use of the amphibious airplanes which are capable to land on the beach and lakes which may also attract the foreign as well as domestic tourists to visit the beautiful but isolated watery spots and isles.

Notwithstanding, there is a negative factor that may hinder the country's economic growth in the long term. People are not aware that the extremely asymmetric economic gains distribution where the minority of around 5% of the total population holds 80% of the economic wealth is the consequence of the government policy that keeps holding cheap labor wage (and also low paid civil servants) used as the national competitive advantage. 

This long-standing fallacy makes the wage of Indonesia labor gradually become lower and lower compared to that of the neighboring countries such as Malaysia, which was in par around the 1960s. The high gap of labor wage culminates in the “exodus” of many Indonesian males and female work-forces abroad surrendering their fates on the mercy of their foreign masters.

To overcome this irregularity, the government, as well as all the stakeholders, should have shifted their mindset. The danger to keep this erroneous policy is that the social tension (not mingle with political upheaval) will grow up marked by intensive strikes led by various labor unions. The government should heavily scrutinize the financial report of the "big" established company which claims that they cannot afford to pay the minimum wage.

The human resources quality improvement, the motto which is repeatedly uttered, is just lip service if not genuinely supported by their welfare improvement.

A Total of 13,466 Islands Shape the Indonesian Archipelago

In the official report, it is always mentioned that the number of Indonesian islands is 17,508. This number becomes the sole reference of many institutions both domestically and abroad. This high number is obtained by including coral reefs as islets, whereas they appear only in the low tide but submerge under the water in high tide. 

Under the UN Law of the Sea (UNCLOS) the island is defined as terrain appears above the sea level regardless of whether it is in low or high tide. In addition, it should be capable to support life marked by one or more plants growing on it. As such the number of Indonesian islands should be rectified. 

Based on the geographical surveys done starting from 2007 to 2010 through inventorying and verification of the individual name of the islands and its coordinate determined by means of global positioning system (GPS), the total number of Indonesian islands is 13,466. 

The list of the island names from those surveys output has been submitted to the United Nations Group of Experts on Geographical Names (UNGEGN last year. However, the result of those surveys has not yet been stipulated in government regulation despite its significant implication in many aspects. 

Indonesia has reached many maritime boundary agreements with its neighboring countries but there are still some critical dispute areas which are rich in mineral resources such as Ambalat Sea in the northern part of Makasar Strait.

Another important marine survey that has not yet been carried out so many is bathymetry mapping due to expensive cost. In spite of that, Indonesia as successfully extending its continental self west of Aceh province measuring by 4,200 square kilometers and was approved by the UN in 2010. This extension is possible as the UNCLOS stipulates that as far as the depth of the sea water is less than 200 meters, a country may have a Continental Shelf up to 350 miles from its coastline, beyond the normal 200 miles. 

As an archipelagic state, Indonesia need to settle up all the maritime boundary issues both for fixing the Exclusive Economic Zone (EEZ) as well as Continental Shelf in order to protect our fishermen from being caught by neighbor authority, intercept and seize the illegal fishing boats, conserve marine biodiversity and give firm legal support in offering mineral exploration blocks.

The Mystery of Prehistoric Megaliths

Far remote in the dawn of human history, there was a period when people used to erect huge stone monuments, which today is called the megalithic era. The monuments were intended either to commemorate the dead, to praise the Creator of the universe or to call for the local gods in providing their blessings.

Megaliths are specifically defined as monolith erected monuments which include menhir and obelisk. The term of megaliths, in general, may include Stonehenge in Great Britain, the obelisk in Egypt, dolmen (offering stony altar) and sarcophagus for the burial of noted persons.

Menhirs can be found in various parts of the world and sometimes it is difficult to explain how and why ancient, prehistoric people managed to construct such a huge stony monument weighing up to 250 tons. 


A speculative explanation points out to giants who possibly lived before the Floods more than 30,000 years ago, the only individuals capable to manage such heavy stones. However such reasoning is unjustifiable as there are some which are just 8,000 years old or less.

Indonesia inherits the remains from the megalithic era shown by numerous menhirs found spread out throughout the archipelago. The origin of menhir in Indonesia as in everywhere else is still a mystery. A certain theory asserts that megalithic tradition came from Central Asia following several waves of migration southward to various parts of Indonesia and westward to Europe starting from 2,500 BC up to  800 BC.

Menhirs erected for the purpose of animism ritual activities found in Batusangkar and Limapuluh Koto Regency, West Sumatera, taking the forms of swords, horny beasts or human heads of around 4,500 years old.

The stony monuments found in Tunjungmuli village, Purbalingga regency, Central Java are believed to be used as offering altars. Some menhirs in the form of wrapped dead body were found just recently which is supposed to be used for rituals to expel bad omen.

Toraja area, in South Sulawesi, preserves around 100 menhirs, some of which are huge measuring not less than 8 meters height. The ancient Torajanese erected those stony monuments right in front of the noble person’s burial place.

Menhirs in Sumba which stand together with dolmens and sarcophagus,  the noble families’ graves, were erected for the purpose of rituals to preserve the harmonious interaction of the immaterial and material worlds.

Menhirs in Flores had been intended for various purposes such as for declaring wars, opening the forest for agricultural cultivation and for praising local gods. Unfortunately, only a few menhirs are preserved and today treated as anthropological remains.

Menhir has lost its function as a sacred place, and merely becomes an anthropological remain, except in Nias island, offshore of North Sumatra. Until today  Nias people still preserve the megalithic rituals and even erect new menhirs for those purposes.  UNESCO plans to enlist Nias in World Heritage because of its “living megalith culture”.

In this island, most menhirs were constructed in the form human bodies complete with their phallus or stand-alone big phallus of 2 to 3 meters height symbolizing the human fertility. Dolmens erected near those menhirs were used for offering altars.  


All menhirs were erected in purpose at around 500 meters above the sea level to avoid the possible damage from tsunamis which from time to time swept the Nias coastal area for thousand-year period.

Who were really these megalith people? Was there any relationship between Indonesian prehistoric cave people and megalith people? Were they the same or different people? Why were menhirs erected in different places around the world separated by such long distances such as Europe-Indonesian archipelago-Easter Island far away in the eastern part of Pacific?

Could it be that Nias people are the clue to open the mystery? Too many questions are unanswered and too many happenings still remain mystery.