Institute for National and Democratic Studies

Oil Boosted, SBY-JK Broke promise!

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INDIESBLOG | Jakarta (6/5)—Peoples still considering promise President SBY at November 2007, which will not boost up the price of oil. But like other politician promises, nothing that is coincided. Monday (5/5) then, through limited meeting of minister of economics, President SBY breaks promise by announcing the plan to boost up the price subsidizes oil.

“The question now is not whether the oil price will rise or not. If oil must boosted, for how much? What commodity? Does its 20 %, 25 %, or 30 %? Why coming up with the number?” says President SBY in State Palace (Kompas, 6/5).

According to plan, this policy will be accompanied with thrift of total consumption oil and giving of compensation that is big enough to poor circle. However, government still have not determined how many percentage of the hike, when will be implemented, and commodity type BBM subsidizes any kind of which will be boosted up.

After finishing of the limited meeting of minister, Coordinating Minister Economics of Budiono only tells, still be calculated detail and in time will be announced. “The problem of magnitude increases of the price of BBM, government still calculating and finalizes his (its technical problem. However its magnitude still within range of which able to accounted on public,” says Budiono.

Primary factor surrounding increase of the price of this BBM is increase of the price of world crude oil. This week, the price of world oil price in US$116 dollars per barrel, and then its approximately still continuously goes up so exceeding US$120 dollars per barrel by June 2008. In fact it was an anomaly, because it happened at the time when the world economy was estimated will experience retarder. “If the economic growth were retarded, consumption of oil also actually downwards, thus the price of oil ought to go down,” explains A. Prasetyantoko.

Increase of the price of world oil is caused existence of deluge of toxic derivative which is vomiting from financial crisis of AS to commodity market. As reported on various mass medias, now at least there were US$516 trillion toxic derivative fund caused the rising the price of various important commodities like oil and food. This toxic fund besieges oil sales contract papers and food commodity so that request in virtual experiences improvement. This is main ringleader gone up it the price of in the world.

Boost of the price of world oil is told has strangled national budget (APBN). Though governmental applies directive the price of Indonesia oil (Indonesian Crude Price) is assessing US$5 per barrel lower compared to West Texas Intermediate (WTI), but burden APBN 2008 remain to just of height. “At Least Rp 260 trillion or one-fourth from fund APBN must be spent to take care of the price of oil,” explains some observers.

Swells it subsidy fund oil in APBN looked into will lessen trust to APBN and causes alliance moving average difficult to experience increase. The price of government bond also will experience pressure. “To cure trust to APBN, the taste is governmental of course perforce to boost up the price of BBM?” explains Purbaya Yudhi Sadewa, Chief Economist Danareksa Research Institute (Kompas, 5/5).

As of tone with the statement, Indonesia Indonesian Chamber Of Commerce Head Leader MS HIDAYAT tells the employees are still waiting for concrete policy of the governmental related to energy crisis. Sooner are better. “Speculations most off all in financial market soon can be negated,” said Hidayat. Indonesian chamber of commerce (KADIN) worried of lethargy of government can cause capital flight.

Reject the Oil Boost

What thought of by government, entrepreneur, and the economic expert pro- capitals, in fact doesn’t express concrete aspiration from Indonesia people that is up to now still be twisted economic difficulty. People actually have time to be easy when hearing that increase of BBM is stepping is last which will be gone through government. Even, at the time of celebration of Mayday 2008 then, people claiming government for soon reduces the price of requirement of fundamental, including BBM.

Rudhi HB Daman, Coordinator of People Struggle Front, questioning the policy. According To Rudhi, oil crisis a world of strangles Indonesia in fact cannot be finalized with only boosts up the price of BBM. The worlds need the fundamental correction to Indonesia and world economics order to overcome this crisis. “Exactly the policy would increasingly fertilize speculation the price of fundamental requirement in internal market.”

Meanwhile, Erpan Faryadi, General Secretary of the Alliance of Agrarian Reform Movement (AGRA) express, increase of the price of oil will be inflationary the price of many basic needs in rural areas would increasingly leaps. At the moment, rural transportation infrastructure obsolesce has caused the price of requirement of fundamental bounces up is higher compared to in urban. “When the price of oil is boosted up, the livelihood of rural communities which were majority poor peasant and farm worker,” explains Erpan.

The price of oil actually not the only burden APBN 2008. At least there are 40 % budget burden APBN which must be allocation to pay foreign debt and interest. Besides, governmental also able to doubled incomes by vanishing tax holiday and cuts short a period of asset recovery for foreign corporations. This told by Don K. Marut, Direktur Eksekutif INFID. As people know, in 2008, Indonesia had spend at least Rp 95 trillion just to pay the interest foreign debt.

Other choice also available is restructuring sharing contract of mining production, especially oil and gas, between governments with peripatetic giant corporations in oil sector that operate in Indonesia. Corporations like Caltex, Chevron, British Petroleum, and Exxon Mobile Oil is giant imperialists in oil sector which of course washes raw-gold a real big profit as result of increase of the price of world oil. “Based on the Indonesian Constitution 1945, governmental has authority for restructure the structure of sharing that can more profiting is Indonesia,” says Syamsul Ardiansyah, researcher of Institute for National and Democratic Studies (INDIES).

Disinclination of government for restructuring sharing contract of mining production and exclusive only chooses increase of the price of showing government character SBY-JK as puppet government working for imperialism. “There is no choice for us besides to reject the oil boost!” assertive of Rudhi.***

Written by INDIES

May 10, 2008 at 8:06 am

Posted in English Content

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