BI Cuts Back on Money Market Intervention

BI Cuts Back on Money Market Intervention
The minimum effect Bank Indonesia's policies have in reducing the rupiah volatility made ​​the central bank decide to hold back on its interventions in the money market, analysts said.

"It's useless to continue to fight the market; so the quantity of (BI's) intervention is lowered," Tony Prasetyantono, head of Economics and Public Policy Studies at Gadjah Mada University, said yesterday. The cutback, he said, is evident from sharp decline in foreign exchange reserves. As a result, analysts said the central bank should start being more selective in its intervening.

Based on forex reserves data, from January to November 2012 BI had disbursed Rp3,274 trillion for open-market operations. In the same period this year, the number dropped 24.38 percent to Rp2,476 trillion. Meanwhile, forex reserves had sunk to below US$ 100 billion since last June, along with the foreign capital outflows and the widening current account deficit.

Tony assessed that BI's decision not to enter the market due to a weakening rupiah is actually a good way to reduce the trade balance deficit. In the last ten months, the trade balance deficit has reached $6.36 billion.

"If the rupiah strengthens, it would hamper exports," he said.

Nevertheless, Tony hopes that the central bank will not let the exchange rate weakened too deep. "Do not let it exceed the 12,000 mark," said Tony.

At the Jakarta Interbank Dollar Spot Rate (JISDOR) on Thursday last week, the rupiah briefly penetrated Rp12,018 per US dollar. However, on Friday's trade the local currecy bounced back to Rp11,960 per US dollar.

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Tragedy Train Crashes Into Gas Tanker in Bintaro

Tragedy Train Crashes Into Gas Tanker in Bintaro
Several people died after a train crashed into a Pertamina gasoline tanker at a railroad crossing in Bintaro on Monday morning, causing one female-only carriage to overturn and burst into flames.

“Five people have died, nine have sustained serious injuries and 82 others were injured,” National Police spokesman Rikwanto said on Monday evening.

Antonius Tarigan, a BeritaSatu TV reporter on the scene, said the tanker had driven too fast across the railway track, while the barrier had come down too late.

Police officers, soldiers, firefighters and officials from the Indonesian Red Cross (PMI) spent Monday afternoon evacuating the victims, police said.

Rikwanto said three men and two women were killed in the crash. They have been identified as the train driver, Darman, his assistant, M. Suhbi, and technician Sofyan Hadi. The two female passengers were identified as 16-year-old Yuni, and Rosa, whose age could not be confirmed.

Transport officials confirmed that the overturned section of the train was a section reserved for women. Women-only carriages, which were introduced to give female passengers a greater sense of security, are fairly common on Jakarta’s rail network.

Commuter Line (KCJ), a subsidiary of state-owned train company Kereta Api Indonesia, said the rescue operation was still underway.

“Regarding the accident in Pondok Bentung, I can confirm that train KA 1131 from Serpong to Tanah Abang was hit by a tanker. The truck was on fire and the front carriage derailed,” KCJ spokeswoman Eva Chairunnisa said.

A train security guard told the Jakarta Globe that the train made a stop at Pondok Ranji station before continuing to Kebayoran station.

Panji Agestri said the train applied the brakes twice before the intersection.

“After that, the train collapsed to the right side and I heard the explosion,” said Panji, who was in the second carriage of the train.

“The access to the first car was blocked and I couldn’t go in there,” he said. “The passengers were panicking and they broke the windows to get out of the car. When I checked, it turned out that we had hit a gasoline truck.”

One passenger described a scene of panic and confusion as the overturned carriage caused passengers to fall onto each other.

“I was in the first carriage… all of a sudden, the carriage turned sideways and the other passengers were on top of each other. I heard a loud noise then a major fire burst through from the train driver’s compartment,” Endang told the Globe. “Everyone was screaming hysterically, crying and panicking. Everyone wanted to get out, and people were trampling on each other. Luckily, someone from outside [the train] broke the glass and I was helped to get out”
Tragedy Train Crashes Into Gas Tanker in Bintaro

Tragedy Train Crashes Into Gas Tanker in Bintaro

Sukendar Mulya, spokesman of Kereta Api Inodnesia, said on Monday afternoon that train services on the line had been halted. It was not clear on Monday evening when train services would resume but KAI said late on Monday that the trained would be removed overnight.

“The electricity along the track connecting Kanji and Kebayoran was switched off for safety reasons during the evacuation,” he said.

A statement from NTMC Polri said firefighters were still trying to extinguish the blaze at 12:30 p.m.

Transportation Minister E.E. Mangindaan said the accident was under investigation.

“I’ve have heard about it, it’s being investigated… I cannot comment further,” he said on Monday afternoon.

Eva said that the accident happened at 11:20 a.m, although the transportation ministry earlier reported the time incorrectly as having happened at 10 a.m.

A Pertamina spokesman confirmed that the tanker belonged to the state-owned oil-and-gas company.

“Regarding the cause of the accident, we are still waiting the official investigation from the police,” said Ali Mundakir, Pertamina vice president of corporate communications. “The tanker that was hit by the train was carrying 24 kiloliters of gasoline to be distributed to Bintaro and the surrounding areas.”

Pertamina was not able to comment on whether the driver had been traveling too fast, but said the company placed speed restrictions on its drivers.

“The standard operating procedure for gas trucks is very tight and this will be a part of an investigation that we will conduct,” Ali said.

Azas Tigor Nainggolan, chairman of the Jakarta Citizens Forum (Fakta), who also serves as chairman of the Jakarta Transportation Council, said that most train accidents in Jakarta happened because of poor railway maintenance and weak regulations imposed by KAI — combined with poor awareness of road users.

“In most cases, accidents happened because of an error by both road users and the train company,” he said. “In this Bintaro accident I believe there is no difference.”

The results of the investigation into the crash are some way off, but Azas speculated that an element of crying wolf may be to blame for an unacceptable level of complacency among road users — sirens at railroad crossing were sometimes employed when no train was due to pass in order to manage traffic congestion, he said.

“This is a serious violation, because officers sometimes do not use the siren properly,” he said. “Some people no longer pay attention to the siren because they thought it was just some train officers acting up: this is why accidents sometimes happen.”

The head of advocacy of the passengers’ group took a different view.

“It is unfair to dump all the burden on KAI and blame them for every accident when the road users are the ones who caused the accidents,” Darmaningtyas said, emphasizing that motorists frequently threw caution to the wind at rail crossings.

He also pointed to the high number of illegal railway crossings as a problem.

“Many of these railway crossings were built illegally long after the construction of the railway,” he said. “We can’t expect KAI to guard and secure every single illegal railway crossing — they need to be closed down.”

Train crashes are frequent in Indonesia, and Bintaro was the site of the country’s worst-ever rail catastrophe.
On Oct. 1987, a train leaving Rangkasbitung for Tanah Abang was allowed to roll on to Sudirmara by the station master. Two crowded trains crashed in the station, killing 156 people.

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