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The Role of Bappenas on Overcoming Indonesian 
                National Crisis


                  Dadang Solihin



                     Country Report
      For the Regional Development Planning Course
            Sapporo, Hokkaido March 30, 1999
dadang-solihin.blogspot.com   2
Contents
   Bappenas Position
   My Job
   Organization Chart of Bureau for Regional Development II
   The National Crisis 
   Social Safety Net 
   Expectations from the Course




                       dadang-solihin.blogspot.com             3
Bappenas Position (1)
 BAPPENAS stand for Badan Perencanaan Pembangunan 
  Nasional or National Development Planning Agency
 On one hand Bappenas is acquire to take more responsibility 
  to solve the problem, 
 On the other hand Bappenas as one of the Indonesian 
  governmental institutions face some obstacles to do these 
  obligations due to the lack of public trust to the Government. 




                        dadang-solihin.blogspot.com            4
Bappenas Position (2)
   Bappenas is the governmental institutional which responsible for the 
    Indonesian development planning. As the plan of work in these functions, 
    Bappenas develops the National Five Years Development Plan (REPELITA) 
    based on the National State Guidelines (GBHN).
 Currently Indonesia does not have the National REPELITA. Meanwhile we 
  have the GBHN that is the result of the People’s Representative Special 
  Meeting in last November. This GBHN is more considered as a short term 
  National Guidelines.
 In the condition of not having legal document in planning, Bappenas face 
  the current economic crisis, which need right solutions. Every mistake in 
  handling this economic crisis will put the country’s future in danger.




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My Job (1)
 I currently work for the Bureau for Regional Development II 
  Bappenas.
 The bureau is responsible for the development of 13 
  provinces in East Indonesia which covers Kalimantan, 
  Sulawesi, Nusa Tenggara, East Timor, Maluku and Irian Jaya. 




                       dadang-solihin.blogspot.com           6
My Job (2)
   The main tasks of Bureau for Regional Development II are:
    1. Supervising Provincial Development Planning Agency (BAPPEDA), 
       particularly in the implementation of bottom up planning process; 
    2. Supporting the development of regional development data and 
       information;
    3. Programming and controlling the specific grant for regreening and 
       reforestation; 
    4. Programming and controlling the specific grant for area development 
       assistance;
    5. Supporting and controlling foreign assisted area development 
       programs;
    6. Programming and controlling development programs implemented by 
       the Ministry of Home Affairs.

                             dadang-solihin.blogspot.com                    7
My Job (3)
 The bureau consists of three divisions.  
    the division for Development of Eastern Region I. This division is 
     responsible for 8 provinces in Kalimantan and Sulawesi.  
    the Division for Development of Eastern Region II that is responsible 
     for the rest of the islands in the eastern region.  
    the division for developing development programs for East Indonesia 
     (one sub‐division), and providing data and information of the 
     development achieved and planned (one sub‐division). 




                            dadang-solihin.blogspot.com                       8
Sub‐Division for Provincial 
                               Development Assistance




                               Sub‐Division for District & 
                                  Rural Development 
                                      Assistance

                                                                 Division for 

                                                               Eastern Region I
                              Sub‐Division for Area            Development of 
                              Development Program




                              Sub‐Division for Regional 
                                  Development II
                                                                                            II
                                                                                       Bureau for




                                                                 Regional 
                                                               Division for 




                               Sub‐Division for Data & 
                                                              Development II




                                    Information
                                                                                  Regional Development 




dadang-solihin.blogspot.com   Sub‐Division for Provincial 
                               Development Assistance



                              Sub‐Division for District & 
                                 Rural Development 
                                     Assistance
                                                                Division for 

                                                              Eastern Region II
                                                              Development of 




                                Sub‐Division for Area 
                               Development Program
9
                                                                                                          Organization Chart of Bureau for Regional Development II
The National Crisis
   Several incidents in the last couple of years that include 
    natural phenomena such as a very long drought seasons and 
    the social and political crisis which lead to the economic crisis 
    is believed to main sources in this national crisis.




                           dadang-solihin.blogspot.com              10
The National Crisis (1)
   These sources can be categorized into four: 
     First the economic pressure, externally and internally. Since the middle 
      of 1997 several Asian countries including Indonesia face the economic 
      and monetary crisis. 
     This crisis begins with the weakening of the Asian local currencies to 
      foreign currencies, especially to the US dollar. 
     This pressure is very difficult to avoid due to the condition that the 
      Indonesian economic establishment is not as strong as predicted 
      especially when later we found out that most production sectors are 
      neither independent nor competitive.




                             dadang-solihin.blogspot.com                        11
The National Crisis (2)
 These conditions lead to very serious financial problems for the 
  Government and business. 
 Bappenas (1998) stated that for the 1998/1999 fiscal year these financial 
  problems force the Government to assign foreign aids to almost the entire 
  regular and development budget.
 On the other hand the government can not depend on the businesses 
  contribution because they also face some serious problems in maintaining 
  the economic movement, some of them even lost the business.




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The National Crisis (3)
 As the result, Indonesia then encounters a very big and unavoidable 
  unemployment crisis in urban and rural areas that is predicted to become 
  more than 13,4 millions people. 
 Meanwhile, people’s spending capacity is significantly decreasing that 
  make difficult for them to fulfill their needs in housing, clothes, and even 
  access to education and health services. 
 The number of people who live under poverty is increasing rapidly, and 
  estimated to become 80 millions of people proportional to 40% of 
  Indonesian. 




                              dadang-solihin.blogspot.com                     13
The National Crisis (4)
   Second, the monetary and economic crisis is coexist with strong political 
    pressures due to the reform movement that demand all of the 
    government officials to establish a transparent, honest, fair and 
    accountable working conditions, to take more stand to the people 
    especially to the less‐fortunate group. 
   The reform movements cause a very fast and fundamental change in 
    terms of social and political conditions in Indonesia lately.




                             dadang-solihin.blogspot.com                     14
The National Crisis (5)
   Third, external factors cause by the abnormal climate phenomena. Since 
    1997, natural phenomena known as El Nino cause a very long drought 
    season in Indonesia. 
 This not only leads to the decreasing of agricultural production and 
  preservation, but also to a very serious food shortage in some areas. 
 El Nino also causes some very big scale natural disaster such as forest 
  blazing and others. Indonesia still has to face some problems due to the 
  increasing of rain cause by what known as La Nina. 
   La Nina contributes to flood that will affect the national agricultural 
    production and infrastructure in urban and rural areas. 




                               dadang-solihin.blogspot.com                     15
The National Crisis (6)
 The last and the most unexpected conditions are the people’s 
  crisis of confidence to the government due to the government 
  wrongdoing in the past, and the lack of government capability 
  in solving the current national crisis. 
 In terms of national development, the lack of public 
  confidence to the government is very big obstacles because 
  the development program will not be successful without 
  public participation. 




                        dadang-solihin.blogspot.com           16
Social Safety Net (1)
        Rescue                                         There are four strategic stages of 
               Recovery                                 development planning determined by 
                      Stabilization                     the Government in order to solve the 
 5
                              Development
                                                        problems, to fulfill the urgent, realistic, 
                                                        and operational needs, and to avoid 
                                                        the people social and economic 
 0
      98/99   99/00   00/01   01/02   02/03   03/04     condition to become worse. 


-5


-10




-15

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Social Safety Net (2)
   The first stage is rescue mission that predicted to require 1 (one) to 2 (two) 
    years since the 1998/1999 fiscal year. 
   In this stage, it is predicted that the economic growth is below zero (under 
    the sea), while the government predicts (and hopes) that by the end of 
    1999/2000 fiscal year, Indonesia will gain the 0 % annual economic 
    growth.
•   The second is recovery stage that has some overlapped characteristics 
    with the previous stage and predicted to take time 1 to 2 years. 




                               dadang-solihin.blogspot.com                      18
Social Safety Net (3)
•   Next is stabilization, which also needs 1 to 2 years after the rescue stage. 
•   The development stage will be started after that. These stages will be used 
    as a guideline in national development policies and regional development 
    that has to consider the regional specific characteristics. 
•   The strategy that put more emphasis on rescue and recovery policies is 
    known as the Social Safety Net (SSN).




                               dadang-solihin.blogspot.com                      19
Social Safety Net (4)
   The Social Safety Net is a policy that can be achieved by some activities 
    and interventions in order to raise the level of public economy. 
   This policy is implemented through four programs or intervention area 
    such as 
     1. Food security program; 
     2. Employment creation program; 
     3. Social protection program; 
     4. Program for supporting small and medium enterprises. 




                              dadang-solihin.blogspot.com                        20
Social Safety Net (5)
   Food security program is planned to guarantee food supply for people. 
   Based on some cases in several regions, the government should consider 
    the food consumption diversification that follows the culture and regional 
    characteristics. 
   This policy is hoped to be achieved through increasing the local food 
    production. On the other hand, the distribution aspect should also 
    carefully consider.
   Employment creation program is planned to reduce unemployment and 
    to establish sustainable productive activities after this program.




                             dadang-solihin.blogspot.com                     21
Social Safety Net (6)
   Social protection program is to maintain access to education and health 
    service facilities. 
   In the health aspect, this program will provide assistance on drug 
    supplies to every Public Health Center (Puskesmas) and other health 
    facilities. 
   The focus of this program in education aspects is to avoid the decreasing 
    of children’s level of participation and to maintain level that has been 
    achieved by the government program. 
   This program is implemented through reducing education fee from 
    secondary school to university.




                            dadang-solihin.blogspot.com                     22
Social Safety Net (7)
   Public economy enhancement through development and support to 
    small and medium scale enterprises. 
   Small and medium scale enterprises also include household‐based 
    business, and even businesses in small villages that have local cultural 
    content. 
   This program is implemented through training, promotional aids and 
    partnership.




                            dadang-solihin.blogspot.com                         23
Expectations from the Course (1)
   A few decades ago Japan had a lot of similar characteristics with Indonesia 
    nowadays; regional disparity between Central Japan and the other areas 
    (such as Hokkaido, Tohoku, Kyushu and Okinawa) is similar to the disparity 
    between the West and East in Indonesia.  
   As Indonesia, the agricultural sector in rural area was the primary sector in 
    Japan economy. 
   Currently, Japan has successfully reduced its regional disparity and the 
    industrial sector becomes the prime mover of the development, but the 
    agricultural sector in rural areas was also well developed to support its 
    development. 




                               dadang-solihin.blogspot.com                       24
Expectations from the Course (2)
 The economic crisis experienced in Indonesia hit most the 
  industrial, service, and financial sectors that forced us to look 
  back to the nature‐based economy which was "forgotten" in 
  the last 20 to 30 years.  
 From the regional aspects, the industries and services mostly 
  developed in urban areas in Jawa, while the potential of 
  natural resources mainly exists in the outer islands, East 
  Indonesia in particular.  
 The challenge for us now is how to change this crisis to be a 
  "blessing in disguise" for the development of East Indonesia.



                          dadang-solihin.blogspot.com              25
Expectations from the Course (3)
 The other relevance of this seminar is the transition of public 
  administration for regional development in Indonesia that will 
  be more decentralized in the future.  
 Although the conception is still under development at this 
  moment, it is good to learn how Japan does.
 Finally, the course is expected to broaden and enrich my 
  knowledge and experiences to support the development of 
  Indonesia, particularly its eastern part.




                         dadang-solihin.blogspot.com            26
どうもありがとうございました



   Terima Kasih


     dadang-solihin.blogspot.com   27

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The Role of Bappenas on Overcoming Indonesian National Crisis

  • 1. The Role of Bappenas on Overcoming Indonesian  National Crisis Dadang Solihin Country Report For the Regional Development Planning Course Sapporo, Hokkaido March 30, 1999
  • 3. Contents  Bappenas Position  My Job  Organization Chart of Bureau for Regional Development II  The National Crisis   Social Safety Net   Expectations from the Course dadang-solihin.blogspot.com 3
  • 4. Bappenas Position (1)  BAPPENAS stand for Badan Perencanaan Pembangunan  Nasional or National Development Planning Agency  On one hand Bappenas is acquire to take more responsibility  to solve the problem,   On the other hand Bappenas as one of the Indonesian  governmental institutions face some obstacles to do these  obligations due to the lack of public trust to the Government.  dadang-solihin.blogspot.com 4
  • 5. Bappenas Position (2)  Bappenas is the governmental institutional which responsible for the  Indonesian development planning. As the plan of work in these functions,  Bappenas develops the National Five Years Development Plan (REPELITA)  based on the National State Guidelines (GBHN).  Currently Indonesia does not have the National REPELITA. Meanwhile we  have the GBHN that is the result of the People’s Representative Special  Meeting in last November. This GBHN is more considered as a short term  National Guidelines.  In the condition of not having legal document in planning, Bappenas face  the current economic crisis, which need right solutions. Every mistake in  handling this economic crisis will put the country’s future in danger. dadang-solihin.blogspot.com 5
  • 6. My Job (1)  I currently work for the Bureau for Regional Development II  Bappenas.  The bureau is responsible for the development of 13  provinces in East Indonesia which covers Kalimantan,  Sulawesi, Nusa Tenggara, East Timor, Maluku and Irian Jaya.  dadang-solihin.blogspot.com 6
  • 7. My Job (2)  The main tasks of Bureau for Regional Development II are: 1. Supervising Provincial Development Planning Agency (BAPPEDA),  particularly in the implementation of bottom up planning process;  2. Supporting the development of regional development data and  information; 3. Programming and controlling the specific grant for regreening and  reforestation;  4. Programming and controlling the specific grant for area development  assistance; 5. Supporting and controlling foreign assisted area development  programs; 6. Programming and controlling development programs implemented by  the Ministry of Home Affairs. dadang-solihin.blogspot.com 7
  • 8. My Job (3)  The bureau consists of three divisions.    the division for Development of Eastern Region I. This division is  responsible for 8 provinces in Kalimantan and Sulawesi.    the Division for Development of Eastern Region II that is responsible  for the rest of the islands in the eastern region.    the division for developing development programs for East Indonesia  (one sub‐division), and providing data and information of the  development achieved and planned (one sub‐division).  dadang-solihin.blogspot.com 8
  • 9. Sub‐Division for Provincial  Development Assistance Sub‐Division for District &  Rural Development  Assistance Division for  Eastern Region I Sub‐Division for Area  Development of  Development Program Sub‐Division for Regional  Development II II Bureau for Regional  Division for  Sub‐Division for Data &  Development II Information Regional Development  dadang-solihin.blogspot.com Sub‐Division for Provincial  Development Assistance Sub‐Division for District &  Rural Development  Assistance Division for  Eastern Region II Development of  Sub‐Division for Area  Development Program 9 Organization Chart of Bureau for Regional Development II
  • 10. The National Crisis  Several incidents in the last couple of years that include  natural phenomena such as a very long drought seasons and  the social and political crisis which lead to the economic crisis  is believed to main sources in this national crisis. dadang-solihin.blogspot.com 10
  • 11. The National Crisis (1)  These sources can be categorized into four:   First the economic pressure, externally and internally. Since the middle  of 1997 several Asian countries including Indonesia face the economic  and monetary crisis.   This crisis begins with the weakening of the Asian local currencies to  foreign currencies, especially to the US dollar.   This pressure is very difficult to avoid due to the condition that the  Indonesian economic establishment is not as strong as predicted  especially when later we found out that most production sectors are  neither independent nor competitive. dadang-solihin.blogspot.com 11
  • 12. The National Crisis (2)  These conditions lead to very serious financial problems for the  Government and business.   Bappenas (1998) stated that for the 1998/1999 fiscal year these financial  problems force the Government to assign foreign aids to almost the entire  regular and development budget.  On the other hand the government can not depend on the businesses  contribution because they also face some serious problems in maintaining  the economic movement, some of them even lost the business. dadang-solihin.blogspot.com 12
  • 13. The National Crisis (3)  As the result, Indonesia then encounters a very big and unavoidable  unemployment crisis in urban and rural areas that is predicted to become  more than 13,4 millions people.   Meanwhile, people’s spending capacity is significantly decreasing that  make difficult for them to fulfill their needs in housing, clothes, and even  access to education and health services.   The number of people who live under poverty is increasing rapidly, and  estimated to become 80 millions of people proportional to 40% of  Indonesian.  dadang-solihin.blogspot.com 13
  • 14. The National Crisis (4)  Second, the monetary and economic crisis is coexist with strong political  pressures due to the reform movement that demand all of the  government officials to establish a transparent, honest, fair and  accountable working conditions, to take more stand to the people  especially to the less‐fortunate group.   The reform movements cause a very fast and fundamental change in  terms of social and political conditions in Indonesia lately. dadang-solihin.blogspot.com 14
  • 15. The National Crisis (5)  Third, external factors cause by the abnormal climate phenomena. Since  1997, natural phenomena known as El Nino cause a very long drought  season in Indonesia.   This not only leads to the decreasing of agricultural production and  preservation, but also to a very serious food shortage in some areas.   El Nino also causes some very big scale natural disaster such as forest  blazing and others. Indonesia still has to face some problems due to the  increasing of rain cause by what known as La Nina.   La Nina contributes to flood that will affect the national agricultural  production and infrastructure in urban and rural areas.  dadang-solihin.blogspot.com 15
  • 16. The National Crisis (6)  The last and the most unexpected conditions are the people’s  crisis of confidence to the government due to the government  wrongdoing in the past, and the lack of government capability  in solving the current national crisis.   In terms of national development, the lack of public  confidence to the government is very big obstacles because  the development program will not be successful without  public participation.  dadang-solihin.blogspot.com 16
  • 17. Social Safety Net (1) Rescue  There are four strategic stages of  Recovery development planning determined by  Stabilization the Government in order to solve the  5 Development problems, to fulfill the urgent, realistic,  and operational needs, and to avoid  the people social and economic  0 98/99 99/00 00/01 01/02 02/03 03/04 condition to become worse.  -5 -10 -15 dadang-solihin.blogspot.com 17
  • 18. Social Safety Net (2)  The first stage is rescue mission that predicted to require 1 (one) to 2 (two)  years since the 1998/1999 fiscal year.   In this stage, it is predicted that the economic growth is below zero (under  the sea), while the government predicts (and hopes) that by the end of  1999/2000 fiscal year, Indonesia will gain the 0 % annual economic  growth. • The second is recovery stage that has some overlapped characteristics  with the previous stage and predicted to take time 1 to 2 years.  dadang-solihin.blogspot.com 18
  • 19. Social Safety Net (3) • Next is stabilization, which also needs 1 to 2 years after the rescue stage.  • The development stage will be started after that. These stages will be used  as a guideline in national development policies and regional development  that has to consider the regional specific characteristics.  • The strategy that put more emphasis on rescue and recovery policies is  known as the Social Safety Net (SSN). dadang-solihin.blogspot.com 19
  • 20. Social Safety Net (4)  The Social Safety Net is a policy that can be achieved by some activities  and interventions in order to raise the level of public economy.   This policy is implemented through four programs or intervention area  such as  1. Food security program;  2. Employment creation program;  3. Social protection program;  4. Program for supporting small and medium enterprises.  dadang-solihin.blogspot.com 20
  • 21. Social Safety Net (5)  Food security program is planned to guarantee food supply for people.   Based on some cases in several regions, the government should consider  the food consumption diversification that follows the culture and regional  characteristics.   This policy is hoped to be achieved through increasing the local food  production. On the other hand, the distribution aspect should also  carefully consider.  Employment creation program is planned to reduce unemployment and  to establish sustainable productive activities after this program. dadang-solihin.blogspot.com 21
  • 22. Social Safety Net (6)  Social protection program is to maintain access to education and health  service facilities.   In the health aspect, this program will provide assistance on drug  supplies to every Public Health Center (Puskesmas) and other health  facilities.   The focus of this program in education aspects is to avoid the decreasing  of children’s level of participation and to maintain level that has been  achieved by the government program.   This program is implemented through reducing education fee from  secondary school to university. dadang-solihin.blogspot.com 22
  • 23. Social Safety Net (7)  Public economy enhancement through development and support to  small and medium scale enterprises.   Small and medium scale enterprises also include household‐based  business, and even businesses in small villages that have local cultural  content.   This program is implemented through training, promotional aids and  partnership. dadang-solihin.blogspot.com 23
  • 24. Expectations from the Course (1)  A few decades ago Japan had a lot of similar characteristics with Indonesia  nowadays; regional disparity between Central Japan and the other areas  (such as Hokkaido, Tohoku, Kyushu and Okinawa) is similar to the disparity  between the West and East in Indonesia.    As Indonesia, the agricultural sector in rural area was the primary sector in  Japan economy.   Currently, Japan has successfully reduced its regional disparity and the  industrial sector becomes the prime mover of the development, but the  agricultural sector in rural areas was also well developed to support its  development.  dadang-solihin.blogspot.com 24
  • 25. Expectations from the Course (2)  The economic crisis experienced in Indonesia hit most the  industrial, service, and financial sectors that forced us to look  back to the nature‐based economy which was "forgotten" in  the last 20 to 30 years.    From the regional aspects, the industries and services mostly  developed in urban areas in Jawa, while the potential of  natural resources mainly exists in the outer islands, East  Indonesia in particular.    The challenge for us now is how to change this crisis to be a  "blessing in disguise" for the development of East Indonesia. dadang-solihin.blogspot.com 25
  • 26. Expectations from the Course (3)  The other relevance of this seminar is the transition of public  administration for regional development in Indonesia that will  be more decentralized in the future.    Although the conception is still under development at this  moment, it is good to learn how Japan does.  Finally, the course is expected to broaden and enrich my  knowledge and experiences to support the development of  Indonesia, particularly its eastern part. dadang-solihin.blogspot.com 26
  • 27. どうもありがとうございました Terima Kasih dadang-solihin.blogspot.com 27