Pidato Presiden Ri English Version

STATE ADDRESS

OF

THE PRESIDENT OF THE REPUBLIC OF INDONESIA

ON THE OCCASION OF

THE 67TH ANNIVERSARY OF

THE PROCLAMATION OF INDEPENDENCE OF

THE REPUBLIC OF INDONESIA

BEFORE THE JOINT SESSION OF

THE HOUSE OF REPRESENTATIVES OF


AND

THE REGIONAL REPRESENTATIVES COUNCIL OF


Jakarta, 16 August 2012

Bismillahirrahmanirrahim,

Assalamu’alaikum Warahmatullahi Wabarakatuh,

May we all be bestowed with prosperity,

Honourable Speaker, Vice Speakers, and Members of the House of

Representatives of the Republic of Indonesia,

Honourable Speaker, Vice Speakers, and Members of the Regional

Representatives Council of the Republic of Indonesia,

Distinguished Chairman, Vice Chairmen, and Members of State Institutions,

Excellencies Ambassadors of Friendly Countries, and Heads of International

Agencies and Organizations,

Fellow Countrymen,

Distinguished Ladies and Gentlemen,

Today, it is with profound gratitude to God the Almighty, Allah SWT, within the

holy month of Ramadan, that we are able to attend the Joint Session of the House

of Representatives of the Republic of Indonesia (DPR-RI), and the Regional

Representatives Council of the Republic of Indonesia (DPD-RI). We are convening

this Session this morning on the occasion of commemorating the 67th Anniversary

of the Proclamation of Independence of the Republic of Indonesia, which will be

continued this evening with the presentation of the Introductory Government

Statement on the Bill on the State Budget for the 2013 Fiscal Year, and its

Financial Note.

On this auspicious occasion, first of all, I would like to extend my best wishes to

the Muslim community who are observing the fasting act of worship throughout

the homeland. May our act of worship in this Month of Ramadan enhance our

belief, devotion and veneration of us all, and may we get the blessing from Allah

SWT. We are equally grateful that, in the last three years, our nation has

celebrated the Anniversary of the Proclamation of

Independence concurrently with the holy month of Ramadan. Last year, the

17th of August 2011 coincided with the 17th of Ramadan 1432 Hegira, when the

Muslim community celebrated the Nuzulul Qur’an (Revelation of the holy Qur’an).

This year we shall celebrate the Proclamation of Independence in close proximity

to the Eid ul-Fitr 1 Syawal 1433 Hegira.

It is therefore appropriate for me, prior to delivering this State Address, to extend

my felicitations on the Eid ul-Fitr 1 Syawal 1433 Hegira to the Muslim ummah

across the nation. Being a common human being, who are not deprived of any

shortcomings and errors, from the bottom of my heart I would like to express my

sincere apologies for any physical and spiritual mistakes and shortcomings, minal

aidzin wal faidzin. Let us make the momentum of this year’s commemoration of

the Proclamation of Independence and the Eid ul-Fitr as a day of triumph, while

simultaneously turning over a new leaf to usher in a future for the nation and

state that is more prosperous, just, advanced, independent, and dignified.

Ladies and Gentlemen,

Four years ago, in 2008, we commemorated the 100th anniversary of the national

awakening. The spirit of the national awakening that was kindled by Budi Utomo,

more than one hundred years ago, reminds us all that in the second hundred

years after the national awakening, our country can emerge as an

advanced country. The condition is that we must have self-

reliance, competitive edge, and advanced civilization. God willing, with our unity,

togetherness and hard work all of those noble ideals shall be a reality.

When this country was proclaimed 67 years ago, Bung Karno, Bung Hatta and the

Founding Fathers of the Republic had set the goals for the establishment of an

Indonesia which is independent, united, sovereign, just, and prosperous, namely

acountry that protects all people of Indonesia and their homeland, and

to advance thepublic well-being, to enlighten the nation’s life and to participate

in the establishment of a world order based on independence, abiding peace and

social justice. The Unitary State of the Republic of Indonesia is established over

the foundation of Pancasila and the 1945 Constitution, and is inspired

by Bhinneka Tunggal Ika ~ unity in diversity.

In a span of 67 years of Indonesia’s history, governments have been present and

carried out responsibilities alternately. Every government, since the government

of President Soekarno, President Soeharto, President Prof. B.J. Habibie, President

K.H. Abdurrahman Wahid, and President Megawati Soekarnoputri,

has arduously worked and determined to build this country towards a better

future. My predecessors had struggled to improve the people’s welfare and the

progress of our nation and homeland. We all should express our sincere

appreciation for their services and devotion. At the moment, we should be

grateful that our country continues to advance,while overcoming challenges and

trials. As a token of our gratitude to our “founding fathers” and our former

leaders, let us continue to remain united and work even harder.

In this 21st century, our big mission is to continue the development of the nation

towards a developed and prosperous Indonesia. In 2045, at precisely the

centennial anniversary of Indonesia’s independence, we are determined to

establish a robust and just economy; a stable and qualified democracy; and

to create an advanced andsuperior nation’s civilization.

In the last five years, we continue developing towards a more prosperous,

democratic, and just country. We are building a country in a dynamic global

environment. It is an environment that provides opportunities, as well as

challenges. It is an environment that also demands us to participate in

establishing world peace, justice and prosperityas a goal enshrined in our

constitution.


History has recorded that, in the last five decades, at the beginning of this

21st century, the condition across the globe actually provides a positive and

promising picture. There have no longer been any major wars involving a number

of countries such as the post First and Second World War. The majority of the

international community opts for the peaceful settlement of disputes.

However, the world continues to revolve. At this moment, we are facing a world

economic situation characterized by uncertainty. The crisis in Europe continues

unabated and there is yet to be light at the end of the tunnel. Developed

countries generally experience stagnation, even recession. The economies of

developing countries also experience significant slowdown. The global economy

this year is predicted to contract from 4 percent to 3.5 percent.

The world economic situation is also characterized by the uncertain political

transformation process in the regions of North Africa and Middle East. Any new

tensions taking place in the region could potentially cause a rise in world oil

prices. Meanwhile, in various parts of the world, many countries bear the brunt of

the negative impact of the climate change. Droughts and floods often pose as the

worst threats that could lead to food crises and rising world food prices. The price

increases of soya beans in the international market for instance, were attributed

to the drastic decline in production in a number of major soya bean-producing

countries. Unless it is properly managed, this condition could detetriorate the

global political and economic constellation.


In the Southeast Asia and Asia Pacific region, we are still faced with traditional

challenges, such as potential conflicts due to border disputes and territorial

claims. We also still face a variety of non-traditional challenges that have a direct

bearing on the safety and welfare of the peoples in the region. We are aware

those issues could trigger new tensions and affect the common efforts to realize

the ASEAN Community and cooperation in the Asia Pacific region.

Our country is strongly committed and continuously contribute to ensure the

implementation of various agreements reached by ASEAN and the East Asia

Summit. We must materialize what have been agreed upon during Indonesia’s

chairmanship in 2011.The realisation of the ASEAN Community by 2015

constitutes an important aspiration that has become our priority in the Southeast

Asian region towards one vision, one identity, and one community.

As we continuously support the democratization and “Nation Building” in

Myanmar, in particular, we pay serious attention to the settlement of

the humanitarian issue of the Rohingya ethnic community in Myanmar. With good

intentions, I have sent a letter to President Thein Sein and urged the issue that

originated from an inter-communal conflict be settled speedily, wisely and

accurately.

We also continue to promote the cohesiveness and central role of ASEAN in facing

various challenges in its vicinity, including the developments related to the South

China Sea. We regret that the ASEAN ministerial meeting this year did not

succeed in producing a joint communiqué. However, due to our proactive and

intensive diplomatic measures, the cohesiveness and central role of ASEAN, have

been reaffirmed and consolidated with the agreement on the six-point principles

on the South China Seasince last 20 July. Therefore, through this forum I wish to

express my gratitude to the ASEAN Leaders for the support and agreement in

giving priority for the conclusion of the code of conduct in the South China Sea.

With the code of conduct that we discussed in ASEAN and East Asia Summit in

Bali in 2011, we will be able to maintain stability, security and order in the South

China Sea.


We follow attentively the alarming political and security developments in the

Middle East region. In response to the developments taking place in Palestine,

Indonesia consistently and as a matter of principle, always strives for the rights of

the Palestinian nation to be independent and sovereign. The apprehension and

struggle of thePalestinian nation is also the apprehension and struggle of our

nation.

We also pay attention to the developments in Syria. Naturally, we do not wish to

see human tragedy continue unabatted. In an active act, once the UN decided to

send a team of observers, Indonesia immediately deployed a number of military

observers to be part of that team. On various occasions, to diffuse the tension in

Syria, we haveproposed a new UN mandate under Chapter 7, or Chapter 6 plus, of

the UN Charter that provides for the authority to immediately halt the conflict and

loss of life without debating the issue concerning the transfer of power in Syria.

Indonesia deeply regrets the absence of agreements in the UN Security Council

that has sparked continuous internal conflict and violence claiming more lives in

Syria.

In the context of a more dynamic geopolitics and the disruption of world peace

and security Indonesia continues to pay attention and contribute to the

maintenance of international peace and security. Our country has become one of

the main contributing countries in UN peacekeeping missions. Presently, with the

establishment of the International Peace and Security Centre in Sentul, Bogor ---

which serves as a modern and integrated peacekeeping operation training

centre--- we shall be able to contribute more to the maintenance of world peace

and security.


Such is the world situation that we face today. It is a situation that warrants our

vigilance and preparedness, at home and abroad. Actually Indonesia does not

remain idle in addressing the various global and regional challenges of today. On

the contrary, Indonesia has and will continue to make concrete contribution to the

world. We continue to take an active part in various international organizations

and become part of the solution.

Furthermore, from the various initiatives and ideas that we have proposed in

response to the international dynamics, praise be to God, our voice has

increasingly been heard and taken into account. We are more often asked to

provide our opinions; “What does Indonesia think?” over a number of world

issues. This proves that as an independent and sovereign nation, we can stand

tall in the international arena.

It is still fresh in our memory when, 14 years ago, in the midst of a stormy crisis,

the IMF came and offered a loan with conditions that actually further compounded

our economic situation. Presently, at a time when our country’s economy keeps

growing, the IMF comes not to offer loan, but to have a consultation and exchange

ideas with Indonesia on overcoming the global crisis that is currently happening.


As one of the members of the G-20, Indonesia consistently lends her support to

the collective effort to achieve a global growth that is more robust, equitable,

inclusive, and sustainable. We also continue to demonstrate our commitment to

advancing the interests of developing countries in the G-20 forum. Consequently,

we continue to encourage the coordination of the G-20 for the creation of food

and energy security, infrastructure development, social protection, financial

inclusion, fair trade, and job creation. All these efforts are undertaken not only

to bolster our national interests in the international fora but also for the common

interests of the nations of the world.

Moreover, in coping with the global economic crisis in the G-20 framework,

Indonesia supports the connectivity of three arenas in the national, regional, and

global spheres. In the national sphere, each country should endeavour to make its

economy healthy. Inthe Eurozone region, we expect an immediate solution to be

found for the economic crisis. Meanwhile, the Southeast Asia and East Asia

regions are expected to be able to support the growth of the world’s economy.

In the global sphere, it is obviously needed a collective cooperation, accurate

policies, supported by trade and investment, and thecareful strengthening of the

financial sector.

As a member of the United Nations, we are also committed to creating a

sustainable global development. In order to address future post-2015

development challenges, new commitment is demanded. During the Rio+20

Summit Conference, we have submitted a post-2015 development agenda,

namely sustainable growth with equity. It is an agenda of development which is

sustainable and equitable. It is a development agenda that ensures the well-being

and prosperity for all mankind without having to cause damage to the

environment.

In order to formulate and provide recommendations on the global development

agenda in the post- 2015 MDGs, the UN Secretary-General has appointed the

President of the Republic of Indonesia, the Prime Minister of the United Kingdom,

and the President of Liberia as Co-Chairs of the UN High-Level Panel of Eminent

Persons on Post-2015 Development Agenda. Through this forum and in

Indonesia’s capacity as one of the Co-Chairs we will contribute our thoughts and

views in formulating the new global development concept and agenda which is

Sustainable Development Goals (SDGs), as a continuation of the MDGs.


Thank be to God, our country today presents itself as an emerging

economy and has become the 16th world economic power. We have become a

middle income country, with poverty and unemployment levels that are gradually

declining successfully. We must be confident and have faith, when the time

comes, God willing, we shall become a strong and developed country in Asia and

held in esteem by the world.

However, today we ought to be vigilant to the fallout of the financial

crisisinstigated by developments taking place in Europe. A valuable lesson

learned we can draw from the crisis in the European region is that fiscal

management that places emphasis on prudent principles needs to be applied. The

government has taken, and will take, appropriate and calibrated measures. We

have gained an indispensable experience when we managed to safely weather

out the 2008 crisis.

This achievement was attributed to the collaboration and synergy

between the central government, regional governments, business community,

banking institutions, and other institutions, so the real sector continues to operate

normally. We have provided a prudent fiscal stimulus. We exercised control to

prevent any new wave of unemployment. We have also provided protection to

cover, assist and alleviate the burden of the lower and middle class segment of

society who were impacted by the economic downturn. It is precisely through

such a combination that our economy remained solid, without any unemployment

explosion, inflation was under control and other economic indicators remained in

check.


We have gone through the reform era for nearly fifteen years. It is in such

a process that we have changed the tide of history by bringing to light a new

order in the life of the nation and state. In a far safer situation, praise be to

God, we have managed to boost economic growth even higher. However, we must

remain vigilant. In the midst of an unfavourable volatile global economy, we

should not miss any opportunities. The decline in exports must be offset by an

increase in domestic investment. The potential of the domestic market should be

capitalized on. We have continuously reduced logistic costs. Any barriers to

business, investment and infrastructure development must be surmounted and

removed.

We also continue to monitor closely the high price of world oil. The goal

isobvious, namely to avoid the fuel oil subsidies from getting bigger and bigger

and we can take anticipatory measures. We have to adopt policies that are not

detrimental to the people. The government has to continue to make efforts to

bring the fuel oil subsidies into a more sound basis through restrictions and

austerity, so the burden to the state budget can be gradually reduced. In such a

way, the fuel oil subsidies can be allocated to the intensification of infrastructure

development. The Government also continues to explore, develop and utilize new

and renewable energy as alternatives. Barring any dramatic changes in fuel oil

prices, which is the soaring prices of fuel oil, we cannot simply raise our fuel oil

prices. On the contrary we must do our best in finding the best possible solution

to ensure efficient use of our fuel oil and a healthy state budget. The idea of

gradually decreasing fuel subsidies is entertained solely for ensuring our

country’s Energy Resilience in the future.

Apart from the dynamism of global oil prices, the international food prices

have also become increasingly difficult to predict. The era of inexpensive food

prices seems to be over. The high food prices are projected to take place for quite

a long time. This is the reason, therefore, we have to provide adequate food

supply through the optimum use of domestic resources. We have to secure the

provision of staple food supply, especially rice. We must reach the rice surplus

target of 10 million tons by 2014, even if it requires our hard work. We have to

expand and intensify food self sufficiency.

Fellow countrymen,

The direction of our development is crystal clear. We have a main agenda,

focused on improving the people’s welfare. As I have mentioned before, praise be

to God, our economy continues to grow. We can survive the world crisis. Our

economic fundamentals are getting stronger, our fiscal is relatively maintained,

and poverty and unemployment levels are decreasing. This reality is

truly heartening for us.

The population of our country this year that is more than 237 million people,

whichconstitutes the fourth most populous country in the world. This increasingly

larger population obviously carries challenges for us to rein in the population

growth rate. The government continues to make serious efforts to

reinvigorate the Family Planning (KB) programme aimed at creating healthy and

prosperous families. We continue to improve the people’s quality of life, whether

by raising the education and health levels, poverty alleviation, job creation, as

well as by the provision of facilities for public services.

In order to optimize qualified and affordable education services for the whole of

the population, the education budget continues to be increased. With the

increasingly large budget every year, we stimulate education reform primarily in

the expansion of access and the improvement of quality in all levels of education.

It is precisely through such process that we have completed the Nine-Year

Compulsory Education Programme. This Programme is gradually incorporated into

the Universal Secondary Education Programme as the pioneer of the Twelve-Year

Compulsory Education Programme. We want children of the nation across all

corners of our homeland to attend a more equitable and qualified basic and

secondary education.

Apart from expanding access to basic and secondary education level, access to

high-level education is also expanded. We provide Operational Aid for State

Universities and Mission-Targeted Scholarships for our brothers and sisters who

are academically capable but financially handicapped. We will

also gradually establish the Community College in every regency

and municipality.

The noble aspiration to realize the Twelve-Year Secondary Education Programme

should obviously be applied by taking into consideration the fiscal potentials of

the central and regional governments. The Provincial Governments should play a

bigger role in supporting the funding of this programme.

We realise that the success of the education programme, both primary and

secondary education, is highly dependent on the teachers’ availability in terms of

appropriate number, distribution, and competence. In conjunction with the

endeavour of improving the teachers’ competence and welfare, we implement

policies aimed at improving teachers’ quality. With these efforts, there is a

positive correlation between theimprovement of welfare and the amelioration of

their performance. After all, education is a long-term investment. We must be

optimistic that, in the next ten or twenty years, the children of the nation would

be ready to welcome “Golden Indonesia”.


Of equal importance to education, the provision of health services is also

improved, particularly for the lower segment of the society. Public Health

Insurance for the Poor and the Near Poor in the form of Jamkesmas continues to

be expanded. The disadvantaged people are now able to receive free health care

and treatment in Public Health Centres (Puskesmas) and Hospitals. As the follow

up to the adoption of Law Number 40 of 2004 on the National Social Insurance

System (SJSN), the Government and the House of Representatives (DPR) have

adopted Law Number 24 of 2011 on the Social Insurance Authority Board (BPJS).

This means that gradually, the five types of social insurance, namely the health

insurance, work accident insurance, old age insurance, pension insurance, as well

as life insurance, would be enjoyed by the people. In this relation, at the

beginning of 2014 the BPJS would be established and operated to provide the

health insurance system nationally. In 2019, at the latest, all Indonesian citizens

shall have health protection insurance.

The fulfilment of the right to healthy living for the entire populace without

exception constitutes the main objective of the implementation of the National

Social Insurance System. In line with the programme, more than 2.5 million

expectant mothers are insured through the Childbirth Insurance. With this

programme, God willing, we shalllower the Mother Mortality Rate (AKI) in line with

expediting the attainment of the MDG’s. They all constitute our answers in

realizing health service expansion for the people. This is the essence of health

reform.

Through health reform, we change the paradigm from merely receiving free

medical services into becoming healthy at no cost. This is the reason that the

improvement of health services and insurance as well as the development of

other health sectors must be synergized with the population growth, scientific and

technological advancement, environmental conservation, including cultural

promotion and the paradigm of a healthy communal life. Through the health

reform, we want to build the Indonesian people, who are not only physically

healthy, but also spiritually sound, so as to be able to build a strong, dependable

and intelligent nation.

Apart from the National Social Insurance System, we also try to realize a secured

livelihood by synergizing the programmes of the people’s empowerment; small,

medium and micro enterprises promotion; and the pro-people programme. All of

the poverty alleviation programmes will be transformed into programmes that are

able to meet the basic needs of all the people equitably, including ensuring the

creation of sustainable income generating activities. The efforts to increase

income are coupled with the efforts to maintain the people’s purchasing power.

We also keep the inflation rate in check at a secure level to ensure the

affordability and accessibility of goods and services that are needed by the

people.


In order to alleviate poverty, the government has launched programmes through

four clusters. The first cluster is the direct aid of affordable rice for

underprivileged people (Raskin), School Operational Support (BOS), and Aspiring

Family Programme. The second cluster, developing the Self Supporting National

Community Empowerment Programme (PNPM Mandiri). The third cluster, small,

micro, and medium enterprise-based programmes through the Smallholder

Business Credit (KUR) and Corporate Social Responsibility (CSR). And the fourth

cluster through inexpensive houses, affordable public transportation, more

equally distributed clean water and electricity, and the improvement of the

livelihood of fishermen and poor urban citizens.

The Government continues to consider and endeavour in enhancing the welfare of

the workers, both with regard to an increasingly adequate pay and any other

forms of allowances. We wish the business community to grow and develop, and

this growth also brings along an improvement to the welfare of their workers.

Therefore, the tripartite integration and cooperation need to be further

encouraged and invigorated.

Sustainable development for all—humans and environment—has become our

common commitment as citizens of the world. With a view to garnering global

solidarity, three years ago, I have conveyed our voluntary commitment to reduce

greenhouse gas emissions by 26 percent of the projected emissions of our

country in 2020. As an elaboration of that commitment, the Government has

adopted the National Plan of Action for the Reduction of Greenhouse Gas (RAN-

GRK) that we apply to five main sectors, namely forestry and peat lands,

agriculture, energy and transportation, industry, and waste. In addition, in order

to enhance environmental supporting capacity, one billion trees have been

planted annually.

From what I have conveyed earlier, obviously the success of the development

weaspire for, could be gauged by whether we are able to enhance the quality and

level of the people’s living standards in a more just and equitably distributed

manner. We must provide the opportunities for the increasing numbers of our

people who have permanent jobs with adequate income for themselves and their

families. The people should be able to have access to electricity, clean water, and

comfortable, safe, and healthy housing. Our children and our youth could grow

into healthy and intelligent beings. Our environment should always be serene and

everlasting. That is precisely the Indonesia we want to build. That is the Indonesia

we want to bequeath to our children, grandchildren.


The development framework and the Pro-People programmes I have launched

since the beginning, remain based on four main pillars: pro-growth, pro-job, pro-

poor, and pro-environment. It is in this basic framework that the equitable

distribution of development benefits to accelerate the creation of social justice

and poverty alleviation continues to be a main priority.

We have brought about significant changes and progress to this country. Our

country is regarded as a country with a bright future. Despite the numerous

shared progress that we have achieved, we obviously cannot turn a blind eye to

the problems and challenges that we are still facing.

The challenge to the Indonesia of today and of the future is how our nation is able

to adapt to the changing times. How we should expand infrastructure. We must

ensure that the investment climate and legal certainty do not become obstacles.

We also still have to lower the levels of poverty and unemployment. The equitable

distribution of development should continuously be carried out. These are the

challenges we must address ahead.


At the moment, political stability is relatively kept under control. Democracy and

respect to human rights are highly upheld. Ever since centuries ago, the great

house of our country has been decorated with diversity. The diversity provides a

characteristic colour in the portrait of Indonesian-ness. We respect and appreciate

this diversity by allowing elbow-room for movement under the aegis of

decentralization and regional autonomy.

The Government applies an asymmetrical decentralization to our brothers and

sisters in Yogyakarta, Aceh, Papua, and West Papua. The on-going

decentralization processactually has not undergone any principal changes. What

the government has carried out was just a better and effective reordering with

the purpose of improving the people’s well-being.

We also continue to consolidate democracy and development in the Veranda of

Mecca, Aceh merits to be considered as a model of peace, diplomacy and

democracy. Aceh has turned into a portrait of history that clearly depicts that

conflicts could be solved by the mechanisms of diplomacy and democracy.

In the Eastern Part of Indonesia (KTI), we are attaching greater attention to

accelerate development there. We want to carry out development for all. A just

and equitable development. We should never tire of stimulating a just and

inclusive development. By taking into account the various characteristics of

different regions, the Governmnet continues to intensify a regional-oriented

development with a view to distributing growth and justice all over the

country. Such endeavour can be realized with the support of the local

governments in utilizing the budget optimally, without the tendency to increase

personnel expenditure unproportionally. There should be an increase in the

composition of the local budget utilization that is more oriented to the

enhancement of the regional production capacity.


Development gaps, either between groups in the society or between regions that

are relatively still wide, continue to be narrowed. One of the efforts to lower

unemployment is, among others, carried out by creating formal jobs, that are

primarily supported by the industrial development in the framework of the Master

Plan for the Acceleration and Expansion of Indonesia’s Economic Development

(MP3EI). The MP3EI also bolsters economic growth that is innovation-generated.

The asset of knowledge should be generated through the consolidation and

application of knowledge and technology. Herein lies the importance of the

synergy between universities and research institutions with regard to industrial

development as offshoots of the MP3EI. In this manner, the utilization of natural

resources with added values can continue to be intensified.

Since the MP3EI was launched on 27 May 2011 until end of July 2012, it has

achieved substantial results during its implementation. 135 infrastructure

development projects and a real sector with an investment value of more than Rp

490 trillion have had ground-breakings. The strategy of the acceleration and

expansion of infrastructure development is a breakthrough to avoid the middle

income trap. It is precisely through this method that we shall stay clear of the

development stagnation often suffered by middle income countries.

Likewise, we must overcome together the gap between regions, between cities

and between sectors. In the Eastern Part of Indonesia, we try to overcome high

prices, to improve the people’s access of obtaining decent education and

health services, to consoslidate fishing and marine sector, and to develop

tourism and creative economy, based on local traditions and culture. Not to be

overlooked, we try to improve the living standards of

the Isolated Traditional Communities (KAT) in numerous hinterland areas. As I said

earlier, through the MP3EI, we stimulate the development of the corridors in

Kalimantan, Sulawesi, Papua and the Moluccas, as well as in Nusa Tenggara

Islands.

Our brothers and sisters in Papua are always close to our hearts. The Government

realizes the complexity of the issues that require specific, fundamental and

comprehensive measures. We close our ranks to accelerate development for the

Papuan people. For this reason, therefore, the Special Autonomy for Papua and

West Papua becomes our basic framework in managing public services,

development and local government. The government has applied an integrated

approach to accelerate development in the land of Papua. To develop the land of

Papua under the agis of the Unitary State of the Republic of Indonesia (NKRI) is

the collective duty of all the nation’s sons and daughters.

For this reason, the government has taken initiatives to accelerate development

in the land of Papua, with the required agenda and budget support. To ensure the

development in Papua and West Papua is carried out in accordance with the plan

and policy, both by the central and regional government, the government

established the UP4B (Unit for the Acceleration of Development in Papua and

West Papua), whose task is to ensure synergy, synchronization and coordination

of all actors of development. In this manner, we can systematically accelerate the

improvement of the people’s welfare in the Provinces of Papua and West Papua.


Our nation is a great nation with a vast territory. In order to preserve its

sovereignty, we need an Indonesian National Defence Force (TNI) that

is tough, reliable, and professional with the support of a modern main defence

weapon system (alutsista). Over the past few years, taking into consideration the

increasingly improved growth of the national economy, the development of the

defence sector has become one of our main priorities in catching up with our

retardation. The increasing additional budget foralutsista expenditure is aimed at

improving the readiness and reliability of the TNI in safeguarding the territorial

sovereignty of the state, in executing defensive tasks of the state during peace

time, and in participating in the maintenance of world peace.Today, the TNI has

turned into the state’s defence force that is increasingly more modern and

professional. This is the successful result of TNI’s Reform that has been carried

out.

The TNI presently appears with the posture of a more modern state defence force.

The power and ability of the navy, army and air forces shall be enhanced in order

to project a deterring effect, particularly in border areas and outermost islands.

In today’s situation of peace, the TNI plays an active role in non-war military

operations, especially in natural disaster mitigation and peace operations

abroad. Along with the improvement of the weaponry quality, we shall also

enhance the soldiers’ professionalism and well-being.

Indonesia continues to raise her vigilance in addressing issues related to

terrorism, land disputes, horizontal violence, narcotics and illegal drugs. With

respect to terrorism, I would like to extend my appreciation and gratitude to our

National Police that has concretely been able to prevent and erradicate terrorism.

Together with the people, we must work shoulder to shoulder to prevent terrorist

acts, which will adversely impact on domestic stability, the loss of innocent

casualties, and harm Indonesia’s image in the international setting.

Regarding land disputes, the government has created an integrated team

consisting of the National Land Agency (BPN), the National Police and

related offices. I have tasked the team to find the best possible solution, so as to

ensure that the people acquire their rights to their land while still preserving and

enforcing the rule of law. In any case, the settlement of land disputes must

combine the legal approach with the socio-cultural solution, so that the sense of

justice can be better served. We certainly do not wish land disputesto degenerate

into violence and acts of taking the law in their own hands.


For the last one year, I noted that there have been a number of issues that have

drawn the attention of the public. It becomes our homework to overcome and

manage those issues. In facing the issues that I am going to mention after this,

the government will continue to work hard in order to fulfill its duties and

obligations.

There are six important and actual issues that I am going to explain in this

occasion. The six issues are, namely, Corruption Eradication; Bureaucratic Reform

and Good Governance; Violence and Social Clash; Investment Climate and Law

Certainty; Infrastructure Development; and Fiscal Policy in facing the global

economic crisis.

The first issue is Corruption Eradication. Corruption is an extraordinary crime that

haveundermined the foundation of the development. Education, health, and

infrastructure that are supposed to improve significantly and could benefit the

society, face some obstacles because of this unsavory practice. In an unequivocal

and explicit language, I have once said there should no longer be any connivance

between the government, the House of Representatives, law enforcement

officers, and the business community in draining the state’s coffers, both in the

State Budget and the Regional Budget. I have to admit there remain a large

number of perpetrators of the criminal act of corruption, whether from the ranks

of the government, regional governments, the House of Representatives

(DPR) and the Regional Representatives Council (DPRD), up to the law

enforcement officers.

We must also admit, the domination of these corruptive practices tend to

spread and swell to the regions, from the recruitment of civil servants in the

bureaucracy, in the procurement of goods and services, until in several public

services. The modus operandi are also diverse, starting from a simple bribery and

gratification, until the most complex that leads to the criminal act of money

laundering.

This is the reason why we must continue to eradicate corruption. The National

Police of the Republic of Indonesia, the Attorney General’s Office, and the

Corruption Eradication Commission (KPK) as the law enforcement institutions

must truly be mutually supportive and reinforcing. In addressing this issue, my

position is clear and firm: law must be enforced indiscriminately, unselective and

give a deterrent effect, as well as guarantee justice and impartiality before the

law.

In every occasion, I have asked BPK, KPK, Polri, Attorney General, and BPKP to

completely prevent corruption that misapropriate the APBN and APBD’s funds.

Our country works hard to increase economic growth and the state revenue, so

that we have bigger budget to finance the development. Imagine if the fund

provided in the APBN and APBD, that we get through hard work, were corrupted.

The war drum against corruption should not slacken. We must

eradicate corruption. Eradicating corruption as an extraordinary crime should be

carried out with extraordinary measures as well. There should not be intervention

to the law enforcing institutions in the fight against corruption. Such intervention,

in fact, will trigger a sense of injustice. Let the law work with its own mechanism

and way in finding justice.

My position is crystal clear, there must be a joint cooperation between the law

enforcement agencies, instead of competing in an unhealthy manner and

undermining each other. Upholding the law indiscriminately is the key. Should

there be any divergence of views, the legal due process should take its normal

course, in compliance with the prevailing legislations. For this reason, therefore,

law enforcement lies in the impartiality of revealing any improprieties, instead of

concealing them.

In this regard, the role of the Corruption Eradication Committee is extremely

important.We truly thank the Committee for its firm acts and hard work. Certainly,

we also encourage the Police Force, the District Attorney, and the Supreme Court

of Justice to do the same.


The second issue on bureaucracy reform and good governance has become

essential, considering that to govern this great and vast country we need serious

efforts from all governmental apparatus from the centre to the regions. We all

share roles and responsibilities. The success of what we have decided in Jakarta is

also determined by the governments in the regions.

The regional governments, starting from the province, regency, municipality,

district, up to the village and sub-district, have become the spearheads of public

service in all corners of the country. Those who provide services morning and

noon, day and night, they are the development heroes who devote themselves

unselfishly.

In managing the government, I have always emphasized all bureaucratic ranks

must be able to improve their roles and functions more optimally and

maximally. Public service must become one of the fundamental parts in

bureaucratic reform. The acceleration of bureaucratic reform is non-

negotiable. The acceleration of the bureaucratic reform is crucial in creating a

reliable, professional, and clean government apparatus, based on the principles of

good governance and clean government.

We must complete the management of government by the expansion of public

participation, starting from the participation of development until opening up

public access in order to participate in the control of government management.

This is an essential part of the government involving public participation. This is

the essence of open government.

Even though we continue to intensify the bureaucratic reform we still find

bureaucratic ranks that have yet to be responsive, tend to be negligence, and

even hinder the course of development. These attitudes and behaviours should be

changed andterminated.

The third issue is regarding social harmony and social clashes. This issue becomes

a serious problem. We have to prevent ourselves from horizontal violence,

whether it is triggered by land dispute, the excess of regional election, or the

difference in views and believes. We have to prevent ourselves from selfish acts

and to impose one’s will on others. Our country should indeed become the

window of harmony and tolerance, not conflict and horizontal violence.

Actually these acts of violence and the communal conflicts could be prevented

when all parties care, are responsible and constantly secure harmony and

tranquility of the life of our society. When all parties concerned care and continue

to work, starting from the regents or mayors and its apparatus, the police and the

TNI territorial command, community and religious prominent leaders, certainly

these violent acts would not have taken place, nor the taking the laws into their

own hands as well as communal conflicts.

However, when the violent acts have taken place, including horizontal conflicts,

the state police must immediately take a quick, firm and appropriate action.

Delays and incomplete tasks cannot be tolerated. Nor do we tolerate any

impression that the police has turned a blind eye. What is important is to avoid

and prevent any fatalities from any party. A tranquil environment is essential for

the serene life of the community. Including the serenity and tranquility of the

religious community to practice their respective religious rites.


The fourth issue is related to the investment climate and legal certainty. We

realize thatwe still experience a number of obstacles in the investment climate

and legal certainty, which are complained by many parties. Those two aspects

have the potential forcreating uncertainty, high-cost economy, and the loss of

opportunity to achieve a higher and more qualified growth. There are also

complaints when the matters on the central government level have been taken

care of, the obstacles eventually come from the regions. We need to work hard to

reduce the high-cost economy. We have and are in the process of evaluating

13,520 Regional Regulations, and annulled 824 Regional Regulations.

Moreover, in order to boost the flow of investment, both Foreign Investment

(PMA) andDomestic Investment (PMDN), we need to balance it with the speed and

ease of getting business licences. We have pressed and accelerated the issuance

of business licences from 60 days to 17 days. Of equal importance, law

enforcement efforts are crucial in instilling a greater sense of security and

stability in investment.

The fifth issue on infrastructure building, which is closely related to the fourth

issue I mentioned previously. Because when investment climate is considered

conducive and legal certainty is in appropriate place, there will

be great opportunities for us to build more infrastructures all across the

country. The potentials and wide open opportunities in our country will

certainly attract investors to invest. This is the golden opportunity that we

cannot afford to miss.

In order to further optimize upon the ‘golden opportunity’, the availability and

quality of the infrastructure is a necessary condition. We need to support the

national effort in accelerating the development of infrastructure in order to

guarantee the sustainability of growth and equity of economic development,

expansion of job opportunities, andthe creation of new business sectors.

The biggest challenge in building infrastructure today is the high demands

from all across Indonesia, while our state budget is relatively limited.

Although in the last few years we have increased our capital expenditure

and infrastructure building budget, our state budget remains limited.

Therefore, I asked regional governments to also allocate its regional budget

for capital expenditure instead of spending it on personnel expenditure and

routine expenditure. God willing, in 2013, the financial transfer to the regions will

account for more than Rp. 500 trillion. I also call for the participation of state

owned enterprises and private sector to cooperate with the government to

accelerate and expand infrastructure building. Otherwise,Indonesia’s economy

with 6 percent average growth today and a great investment opportunity, will not

reach the highest possible rate.

Finally, the sixth issue is on fiscal health. In the midst of the

uncertainty surroundingthe global economic environment, we have become more

challenged to be able to maintain fiscal health. Striking a better balance between

a fiscal policy that is able to provide a development stimulus while

also prioritize the spirit of prudence needs to be conducted.

The ratio of budget deficit to the total amount of GDP needs to be maintained

at a safelevel. Moreover, the efforts to improve the quality of

state expenditure continue to be carried out, both by creating efficiency,

guaranteeing the fluidity of budget absorption, or eradicating the sources of

budget leaks.

I would like to emphazise the importance for us to have a sound fiscal policy. The

ongoing crises befelling many developed countries were primarily caused by

their unhealthy fiscal state. The high defict, as well as the debt ratio vis-a-vis GDP.

Let us see to it that our fiscal state does not become unhealthy and vulnerable

like experienced by many countries.

The problem on subsidies rate that is too high also reduces our fiscal space. Let

us with full awareness and responsibility recalculate the amount of subsidies to

make our economy in better condition that at the end the subsidies are correctly

targeted and allocated.

Fellow Countrymen,

At the final part of this State Address, I would like to express that our

nation todayemerges as a nation not only enjoying an extremely great freedom,

but also a nation endowed with a more democratic state institutional system.

Some of the most important are, that our country has changed in a very

fundamental manner; from an authoritarian and centralistic government to a

government which respects the freedom of expression, of association and of

assembly and of union, and adopts decentralization and regional autonomy.

We have made a major breakthrough in terms of the relationship between the

centre and the regions. The world sees the decentralization and the regional

autonomy as a ‘big bang’ and even as a ‘quiet revolution’. It is precisely in this

relationship between the centre and the regions that we shall continue to

consolidate authority and provide the increasingly large financial resources to the

regions. Whatever is the case, advanced and prosperous regions are important

foundations to creating national competitiveness. We are therefore continuing to

encourage the synergy between the central and regional governments.

The regional institutional capacities must also be enhanced. Should there be any

negative excesses in the execution of decentralization and regional autonomy, let

us put it in order again properly. We put in order problematic Regional

Regulations, business permits in contradiction to the rules of the game and the

optimum role of the Governor as representative of the central government in the

region. For this purpose, therefore, let us give a meaningful substance to the

relationship between the centre and the regions as a harmonization of interest

aimed at reinforcing the bonds of NKRI (Unitary State of the Republic of

Indonesia), by maintaining the sound democratic atmosphere and the special and

unique diversity of the regions.


We have chosen democracy as the means towards prosperity. It is a process of

democracy that gives priority to cleanliness in its execution and the impartial

legal certainty when a dispute occurs. It would be impossible for us to reduce

democracy that will separate us from unity, cohesion and integrity as a nation.

Neither can we afford to downgrade democracy that would conversely lead us

away from the people’s interest and well-being.

Democracy should be devoid of evil traits. We believe democracy without

freedom will turn into a tyranny, but an excessive democracy and not

supplemented with a responsibility in making expression, will turn into anarchy. A

number of excessive elections of the regional heads in several places—

which ignore sound and mature democratic principles—quite often become

anarchist in nature. This is the reason why we have to minimize the impact of

such improper democracy.

We must have a firm belief that we are accelerating the consolidation of

democracy. Without a strong democracy --which is sustained by the upholding of

law and justice-- morality and political ethics will be destroyed. When the law is

not upheld and our democracy is fragile, politics will instead take a divergent

road. Consequently, in democracy we have to enhance the values of tolerance,

diversity, and mutual respect. This is the essence of the principle of coexistence

in diversity, and the principle of freedom within the frame of tolerance. That is the

essence of the motto Bhinneka Tunggal Ika (Unity in Diversity). Patience,

tolerance, and mutual respect are the potentials that do not only serve as pillars

for the life of a multicultural nation, but they also become tangible materialization

of ourselves as a nation that is civilized. That is the face of our blooming

democracy.


It is time for us to prepare for a new role in the 21st century. The challenges we

face in this century are not lighter. However, if we keep on working and continue

working, we shall overcome them. We need to organize our perspective in

managing change and development. Should we join hands together in all

seriousness and make correctionsand improvements, we could achieve

even greater achievements.

We can learn from experiences, errors, past mistakes, so that they are not

repeated. We also have a conception about the things that we need to make

right, today and in the future. What we may still possibly need is self confidence

that we ourselves are the ones who shall determine our own future that we will

create. We are the ones who will determine the future that we wish to realize.

Honourable Speaker, Vice Speakers, and Members of the House of the

Representatives of the Republic of Indonesia,

Honourable Speaker, Vice Speakers, and Members of the Regional Representative

Council of the Republic of Indonesia,


In concluding this address, I would like to appeal to all components of the nation

all over the country, let us make the commemoration of the 67th Anniversary of

the Independence Proclamation as an inspiration of a superior and advanced

country amongst nations in the world.

As Head of State and Government, I would like to express my heartfelt

appreciation and gratitude to all the Indonesian people wherever they may be, for

their participation, patience and support in the development that we are carrying

out together. I would also like to convey my sincere gratitude for the good

cooperation that has been established this far between the government and the

House of Representatives, the Regional Representative Council, and other State

Institutions.

To our brothers and sisters who have dedicated your services in all corners of the

Archipelago, in the outermost islands, in the hinterlands, at the foot of far away

hills and distant places, I shall not forget your struggle and dedication in the midst

of all that quietness. Some of them are present with us today. Those who are at

the upper balcony are exemplary citizens and sons and daughters of the nation

with high achievements intheir respective dedicated services. I am so proud of

their achievements, work ethos and exemplary spirit of all of you.

Finally, in this full of grace month of Ramadan, may God Almighty, Allah SWT,

constantly bestow His blessings on our endeavours to build our just, prosperous,

safe, peaceful and thriving nation and state.

Long Live the Republic of Indonesia!

Pidato Presiden Ri English Version

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