The President has instructed me to solve the case thoroughly.Jakarta (ANTARA) - President Joko Widodo has ordered a thorough investigation into alleged legal violations in the procurement of a defense satellite that inflicted Rp800 billion in losses to the state exchequer.
"The President has instructed me to solve the case thoroughly,” Coordinating Minister for Political, Legal, and Security Affairs, Mahfud MD, said at a press conference that was streamed on the ministry's Youtube channel on Thursday.
The government has held several meetings to discuss the issue, he informed.
Mahfud said he had coordinated with Defense Minister Prabowo Subianto, Communication and Informatics Minister Johnny G. Plate, Finance Minister Sri Mulyani Indrawati, National Defense Forces (TNI) chief General Andika Perkasa, and Attorney General ST Burhanuddin on the issue.
The satellite project in question was realized in 2015 when Ryamizard Ryacudu was defense minister, he said. The project was related to the management of the 123 degrees east longitude orbital slot for the satellite, he informed.
On January 19, 2015, Satellite Garuda-1 left the 123 degrees east longitude orbital slot, thereby leading to a vacuum in the slot's management on the part of Indonesia, Mahfud said.
As per International Telecommunication Union (ITU) regulations, a country that has secured management rights has three years to refill the orbital slot, he noted. Otherwise, the management rights automatically become null, allowing another country to use the slot, he explained.
To fill the vacant slot, the Communication and Informatics Ministry had met the Defense Ministry’s request to secure the rights to manage it in order to build a defense communication satellite (Satkomhan), Mahfud informed.
Thereafter, the Defense Ministry signed a contract with Avanti Communication Limited (Avanti) on December 6, 2015, to lease the Artemis Satellite, which was to function as a floater (temporary orbit filling satellite), although the Communication and Informatics Ministry issued a permit to use the orbital slot at 123 degrees east longitude only on January 29, 2016, he said.
However, the Defense Ministry returned the slot orbit management rights to the Communication and Informatics Ministry on June 25, 2018, he added.
On December 10, 2018, the Communication and Informatics Ministry made a decision to transfer the right to use Indonesian satellites, Garuda-2 and Nusantara-A1-A, in the 123 degrees east longitude orbit filing slot to PT Dini Nusa Kusuma (PT DNK). However, PT DNK was not able to settle the residual problem faced by the Defense Ministry in the procurement of the defense communication satellite, Mahfud said.
When the Defense Ministry signed the contract with Avanti in 2015, it did not have the budget for it, he added.
"The contract was signed to build a defense communication satellite, which involved huge funds although the funds were not available,” Mahfud said.
To build the satellite, the Defense Ministry also signed contracts with Navajo, Airbus, Detente, Hogan Lovel, and Telesat during the 2015–2016 period, although the budget for 2015 also was not available, he disclosed.
The budget was available only in 2016, however, the Defense Ministry self-blocked it, he said.
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Subsequently, Avanti filed a lawsuit with the London Court of International Arbitration against the Defense Ministry for failing to pay satellite rent, in accordance with the contract value they had agreed upon, he informed.
"On July 9, 2019, the arbitration court issued a verdict directing the country to provide an estimated Rp515 billion to Artemis in satellite rent, arbitration fees, consulting fees, and filing satellite rents," he said.
The government also has just received a verdict from the Singapore International Arbitration Center (SIAC) in connection with Navayo’s lawsuit, he added. The SIAC has directed the government to pay US$20.9 million, or Rp304 billion, to Navajo, he continued.
Mahfud predicted the losses will increase since other companies that have signed contracts with the Defense Ministry have not filed lawsuits against it yet.
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Translator: Syaiful Hakim, Suharto
Editor: Rahmad Nasution
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