5.

Real Sector

The Indonesia Government undertook the following policy initiatives to boost real sector growth:

Revision of Government procurement rules so that allocation can be spent within next fiscal

Elimination of export tax for palm oil.

Controlling smuggling by tighter enforcement of customs rules

Elimination of luxury goods taxation

6.

New Policy Measures to Attract more FDI

The Indonesian Government is currently considering a number of new draft laws and decrees aimed at encouraging FDI:

Draft laws pertaining to special Economic Zones, financial safety net and credit management Presidential decrees include those related to Integrated Investment licensing Processing and railway infrastructure Ministerial decrees relate to improved facilitation for foreign investment, fiscal incentives, logistical services, simplification of regulations, etc. A number of action plans are also under preparation for restructuring state firms, privatization of firms, boosting electricity generation, highway expansion etc. A number of other measures have been taken including the VAT exemption, import duty exemption and tax relief on investments

7.

Measures to boost the Stock market

The following measures have been taken:

The Indonesia Stock Exchange has set 10% limits on daily share price movements (the upside limit was increased to 20% subsequently) The authorities have eased accounting rules regarding mark-to-market measures and made it easier for companies to do share buy-backs.