Ranked 56 out of 57

Indonesia

Overall Score: 82

Indicators of Influence

These seven key indicators highlight interference from the tobacco industry in Indonesia.

No. 1

Industry participation in policy development:

Indicator Score:

15 / 20

Tobacco industry front groups played a big role in policy development in 2019. The Coordinating Ministry for Economic Affairs and its subordinate economic ministries endorsed a proposal from Institute for Development of Economics and Finance (INDEF), a tobacco industry front group, to develop a comprehensive Tobacco Roadmap and further re-emphasized the extremely important tobacco industry as a revenue source.

Representatives of the Ministries of Agriculture and Industry attended a Public Discussion Forum organized by tobacco industry front groups on “The Future of Tobacco Industry Under Threat,” to reject the revision of Government Regulation (PP) 109/2012, a national tobacco control policy currently underway. They accused the policy of being a foreign agenda to kill the tobacco industry and a means by which to adopt WHO Framework Convention on Tobacco Control (FCTC) guidelines.

The Minister of Industry accepted recommendations made by three pro-e-cigarette front groups (the Association of Personal Vaporizer Indonesia, Tar-Free Coalition (KABAR) and the Board of NU, a Moslem Religious Group) for the urgent development of an e-cigarette regulation that differs from tobacco control for less harmful products. The Minister of Industry appreciated the proposed regulation that mitigated tobacco risk and promised to prepare a new regulation for tobacco alternatives including heated tobacco products.

No. 2

Tobacco industry-related CSR activities:

Indicator Score:

5 / 20

Government agencies mostly at the provincial level supported and participated in CSR activities organized by the tobacco industry. The Head of Tabanan District in Bali endorsed Sampoerna’s environmental campaign to collect cigarette butts through forming a movement for a dual campaign to save the environment and to support shifting to e-cigarettes.

Sampoerna’s CSR for small- and medium-scale enterprises (SMEs) was highly appreciated. Here are just a few examples: The Mayor of Surabaya City acted as a guest speaker at a media discussion on “Private Sector Responsibility in Accelerating SMEs.” The West Kalimantan Governor gave an opening address in the Province’s SRC Retail Festival 2019. The South Sumatra Governor awarded Sampoerna as the winner of a 2019 CSR competition on the theme “Fostering Togetherness in Promoting the Handicraft and SME Industry to Build a Pro-People Economy and Support Local Tourism.”

The Minister of Youth and Sport supported Djarum Badminton and hoped Djarum would continue the program, whereas the Governor of Central Java defended the promotional roadshow because Djarum had long supported the development of badminton in Indonesia.

No. 3

Benefits given to the tobacco industry:

Indicator Score:

10 / 20

The DG of Custom Ministry of Finance voluntarily defended the excise tax cancelation as a way to sustain the tobacco industry’s survival and not be disturbed by excise tax simplification. Initial rejections on the tax increase came from MPS, and was even strengthened by an official of the Coordinating Minister for Economics who blamed the tax increase for the growth of tobacco industry.

The Head of the Indonesian FDA’s proposal to ban e-cigarettes was strongly opposed by MPs Commissions IX and VI; the Head of West Java Excise Tax Office agreed with the DG of Custom and Tax Policy to impose excise tax on e-cigarettes to legalize the sale of the products. The new Health Minister has not given his standpoint; he would consider all public aspirations and would not make any rash decisions on vaping as the issue still needs to be reviewed.

The DG of the Ministry of Industry was against banning online tobacco ads, arguing that as long as the ads comply with the law where the display of cigarettes and their packaging is prohibited, they are legal and permissible.

No. 4

Unnecessary interaction with the tobacco industry:

Indicator Score:

15 / 20

The Head of the Executive Office of the President (KSP), wearing a Djarum Badminton t-shirt, visited Djarum’s office in response to the Djarum Foundation’s Program Director for Sports’ report on the accusation of child exploitation in the Djarum badminton audition. He affirmed that children were not being exploited and insisted that Djarum’s audition be continued to maintain Indonesia’s badminton achievement.

The Minister of Finance granted an award for “the most tax-friendly corporate” to Sampoerna while the Minister of Industry extended appreciation to the Sampoerna Retail Community (SRC).

The DG of Ministry of Industry accepted assistance from Sampoerna to enforce (PP) 109/2012 by campaigning for “Preventing Children’s Access to Purchase Cigarettes” (PAPRA), implemented in partnership with SCR outlets.

The Ministry of Research, Technology and Higher Education signed a Memorandum of Understanding with Sampoerna on research and development (R & D) of value-added tobacco products. As an industry that plays a role in R & D, Sampoerna would be given incentives in the form of tax deductions. Following the MOU with Sampoerna, the Ministry of Research, Technology and Higher Education held a joint workshop with the United States-ASEAN Business Council (US-ABC) sponsored by Sampoerna dan Juul.

No. 5

Procedure for transparency measures:

Indicator Score:

10 / 20

The tobacco industry is viewed as a normal business. Meeting with the industry is treated as other common meetings, both in preparing the agenda as well as the minutes of the meeting. There is no specific treatment for the tobacco industry nor any specific rules to follow.

More and more government interactions with the tobacco industry are made public for the media to cover. It has become a social norm. Transparency is no longer a significant issue, except for illegal transactions, as is the case with other businesses.

No. 6

Avoiding conflicts of interest:

Indicator Score:

11 / 20

There are no rules that prohibit contributions from any sources including the tobacco industry during the electoral campaign, nor for retired government officials to work for the industry after their government services. With regards to this, a retired Director at the Ministry of Industry was appointed as the Secretary General of GAPPRI (Indonesian Cigarette Factory Association).

No. 7

Preventive measures:

Indicator Score:

16 / 30

Only the Ministry of Health (MOH) had a Tobacco Industry Code of Conduct as further elaboration of the Regulation of the Minister of Administrative and Bureaucratic Reforms No. 37/2012 on the “Guidelines for Managing Conflict of Interest” to specifically apply to the tobacco industry. Having only one ministry follow a code of conduct is not effective in preventing tobacco industry interference nation-wide.

Recommendations

These are ways Indonesia can deter interference from the tobacco industry:

  • The Government of Indonesia, a non-party to the FCTC, has a lack of basic understanding about tobacco industry denormalization. Civil society organization advocacy alone is not enough and won’t work effectively unless supported by pro-public health ministries.
  • The MOH needs to have the courage and leadership to denormalize the tobacco industry, building awareness among government ministries about the irreconcilable conflicts of interest between the tobacco industry and public health that is counterproductive with the country’s commitment to human resources development.
  • The Index report is evidence-based feedback for the MOH and pro-health ministries to open their eyes and develop preventive measures. The MOH Regulation No. 50/2016 on “Managing Conflict of Interest with the Tobacco Industry within MOH,” a further elaboration of the existing Ministry of Administrative and Bureaucratic Reforms’ Regulation No. 37/2012 on the “Guidelines for Managing Conflict of Interests” that specifically targeted the tobacco industry, could serve as a model for developing a national code of conduct when dealing with the tobacco industry.

Learn more about tobacco industry interference in this country.

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