| Home > South-East Asia >> Indonesia | |
Protests, strikes promised as backlash to fuel price hike begins
Jakarta Globe - November 18, 2014
The Land Public Transportation Organization (Organda), which represents private operators of public buses and mini buses, and two Islamic student associations have condemned the increase, announced by President Joko Widodo late on Monday, saying it is unjustified and unfair.
In a televised address, the president said that prices at the pump would go up by an average of 33.6 percent across Indonesia effective from today, a move the government hopes will free up money for spending on infrastructure, education and health.
But on Tuesday, Organda chairwoman Eka Sari Lorena said the move would be "very harmful" to public transportation operators. "We reject the price hike for public transportation because it will also burden the people," Eka said. "If we suffer from profit losses, who will be responsible? The government?"
Members of Organda will strike across Indonesia – "from Sabang to Merauke" – on Wednesday in protest at the decision, Eka said.
She argued public transport should be exempted from the price hike, which will now see Indonesians pay Rp 8,500 (70 US cents) per liter for subsidized gasoline and Rp 7,500 per liter for subsidized diesel. Previously, the fuels sold for Rp 6,500 and Rp 5,500 per liter, respectively.
Shafruhan Sinungan, the head of the Jakarta chapter of Organda, demanded that the city administration allow public transport operators to raise their fares by up to 35 percent if they did not receive an exemption from the higher fuel price.
"Possibly on Thursday we will send a letter to the government about the fare adjustment," Shafruhan said on Tuesday as quoted by Tempo.co.
He added Organda would propose an increase of between 30 percent and 35 percent for fares for public vehicles such as mini buses, mid-sized buses such as Kopaja and Metromini, full-sized buses, and taxis.
The Jakarta administration said separately that it had carried out its own calculations in the event that public transport fares had to be raised, but stressed that there was no decision yet on whether to raise them at all.
Criticism of the government's decision to hike the subsidized fuel price was also meted out by student groups.
The Islamic Students Association (HMI) took to the streets of Central Jakarta just hours after Joko's announcement, burning tires in the middle of Jalan Cikini and blocking nearby roads. The leader of the association's Greater Jakarta chapter, Zulkarnaen Bagariang, promised more demonstrations on Wednesday.
The Association for Moslem Students Action (Kammi) said it would stage a protest at the State Palace and the Energy and Mineral Resources Ministry on Tuesday afternoon.
Kammi spokesman Eko Wardaya said on Tuesday that the government's reasoning for the increase was "made up" and "ironic," given that the global oil price had dipped to four-year lows. "They always say that the subsidy benefits undeserving people; but the price hike will affect everyone, mostly the poor," Eko said.
Indonesia's fuel subsidy is a massive burden on the state budget, accounting for about 13 percent of state spending and fueling the country's current-account deficit.
Finance Minister Bambang Brodjonegoro has said that by raising the prices of subsidized fuel and slashing fuel subsidy spending, the government would have more than Rp 100 trillion in additional funds that could be spent on infrastructure, welfare, and the development of the nation's maritime sector. The minister said the fuel price increase would save Rp 120 trillion in the 2015 budget.
The decision was supported by the student council of the University of Indonesia's School of Economics. "By cutting the subsidy, we can save the state budget and the balance of payments," said council spokesman Hazna Nurul Faiza. "However, the subsidy cut has to be followed with the disbursement of cash handouts to the poor so they can maintain their buying power."
See also:
 |