Partnership Valuation of Membership of Indonesia in Asia Pacific

Space Cooperation Organization (APSCO) with STPLEE

Intan Perwitasari

1,2

Magister of Economic and Development Studies, UNDIP, Semarang, Indonesia

Centre for Aerospace Policy Studies, LAPAN, Jalan Cisadane No. 25, Cikini, Jakarta Pusat, Indonesia

Keywords: Indonesia, APSCO, Benefit Cost Reviews, Multicriteria Analysis.

Abstract: Indonesian membership in Asia Pacific Space Cooperation Organization (APSCO) refers to the provisions of

Presidential Decree of the Republic of Indonesia Number 64 year 1999 on Indonesian Membership and

Contributions Government of The Republic of Indonesia at the international organizations, in article 3 that

first need to be assessed the benefits to be gained and the contribution to be paid. Indonesia's status as a state

signatory to the convention is urgency in this study. Indonesia signed the APSCO convention in 2005 and

actively involved in various activities of the organization forum. The purpose of this research is to identify

the costs and benefits of Indonesia membership in APSCO. The method used is a descriptive qualitative and

quantitative approach to the data sources both primary and secondary data. The results are (i) the membership

will have a high cost impact from economic aspect from annual fee, but high benefit from technical aspect if

Indonesia active on the programme (ii) the benefits and costs of this membership can be equal, or greater by

optimizing action in the organization, (iii) and based on the multicriteria valuation, the technical benefits be

the basis of the first priority, followed by sequential economic, legal, political, social and environmental in

determining Indonesia's membership in APSCO.

1 INTRODUCTION

The Asia-Pacific Space Cooperation Organization

(APSCO) is a collaborative organization outside the

United Nations system for the Asia-Pacific region

initiated by China. The establishment of APSCO aims

to collaborate between countries in the Asia-Pacific

Region in the field of application and development of

space technology, as well as establishing institutions

as a forum for cooperation. On October 27-29 2005 a

meeting was held in Beijing in the context of the

establishment of APSCO, and on October 28, 2005,

Indonesia along with seven other countries, namely:

Bangladesh, China, Iran, Mongolia, Pakistan, Peru,

and Thailand have signed the APSCO Convention.

The LAPAN study (2012, 2018) recommends that

Indonesia immediately ratify the convention which

has implications for the change of status of the

countries signing the convention into APSCO

member countries. Indonesia's participation in an

international organization including APSCO

according to Presidential Decree No. 61 of 1999 must

consider the following (Sekretariat Negara, 1999):

benefits that can be obtained from membership in the

relevant international organization;

1) contributions to be paid as agreed upon and

regulated in the provisions of the organization

concerned and the calculation formula; and

2) state financial capability and financial capacity of

Non Structural Institutions.

Therefore, it is necessary to study the costs and

benefits that Indonesia will get if it becomes a

member of APSCO, and the costs required with

benefit cost review (BCR) approach. Cost-benefit

analysis is a tool to aid to decision making or, and use

in space technology (Hein, Gerald et al., 1976 and

Hockley, Neal., 2014)

The benefits that need to be considered are the

benefits of ideology, politics, economy, socio-

culture, international peace and security, humanity

and other benefits (Sekretariat Negara RI, 1999).

FEM (2007) evaluates benefits and costs by involving

multicriteria namely social, technical, administrative,

political, legal, economic and environmental by

considering benefits and costs not only in monetary

terms but also non-monetary measures. The cost-

benefit analysis clearly embraces an enormous field.

240

Perwitasari, I.

Partnership Valuation of Membership of Indonesia in Asia Pasiﬁc Space Cooperation Organization (APSCO) with STPLEE.

DOI: 10.5220/0008429802400245

In Proceedings of the 2nd International Conference on Inclusive Business in the Changing World (ICIB 2019), pages 240-245

ISBN: 978-989-758-408-4

It offers clear guidelines for the evaluation of

government decisions in such varied fields (Dreze,

Jean., and Ster, Nicholas. 1987). The decision about

becoming or not becoming a full-member of APSCO,

will depend on many factors, and one of them is

financial performance (Diana, Shinta Rahma and

Syafriana, Maya., 2018). Based on the description,

the purpose of this research is counting and benefit

cost review analysis Indonesia membership on

APSCO from the multicriteria analysis.

2 LITERATURE REVIEWS

2.1 APSCO

The APSCO organization was established with the

initiation of the establishment of the Asia-Pacific

Multilateral Cooperation in Space Technology and

Applications (AP-MCSTA) forum by China, Pakistan

and Thailand in Beijing in 1992. At the signing

meeting, Beijing, October 27-29, 2005, Indonesia co-

signed the APSCO Convention on October 28, 2005

along with seven other countries namely Bangladesh,

Iran, Mongolia, Pakistan, Peru, Thailand and China.

The seven countries have ratified the APSCO

Convention and have become members. Indonesia is

still on progress ratification. The aim of this

organization according to the convention (Article 4)

is (APSCO, 2005):

1) Enhance and strengthen the development of space

programs among its Member States by forming

the basics of peaceful cooperation in the

application of space science and technology;

2) Take effective actions in these areas such as

research and development of space technology,

implementation and training, elaborating and

implementing space development policies.

3) Enhancing cooperation, joint development and

sharing of results among the Member States in the

field of space technology and its application and

space science research by bringing together the

potential of regional cooperation;

4) Encourage cooperation between relevant

companies and institutions of Member States and

improve the industrialization of space technology

and its application;

5) Contribute to the peaceful use of space in

activities of international cooperation in the field

of space technology and its application.

2.1.1 Consequences of Indonesian

Membership at APSCO and Programs

In accordance with the provisions of the Convention,

the APSCO provides equal opportunities for all of its

member countries in utilizing basic activities. Some

of the APSCO activities offered and APSCO member

countries obtain the same benefits as percentage-

based contributions are (LAPAN, 2018):

a) Space Technology Applications, which includes 5

sub-fields namely Earth Observation

Applications, Navigation and Positioning

Applications, Weather Forecast Applications,

Communication Applications, Experimental

Technologies and Applications;

b) Space Technology Development, which includes

8 sub-fields namely Earth Observation Satellite

Systems, Communication Satellite Systems,

Navigation Satellite Systems, Metrological

Satellite Systems, Scientific experimental

satellites, Space Ports, Space Launch, Deep Space

Missions;

c) Space Science which includes 3 subfields namely

Space and solar physics, Study on an exploration

of deep space, Study on space life and

microgravity,

d) Education and Training, which includes 6 sub-

fields namely Short training, Degree education,

Distance education, Space education, Education

resources, cross-country platform development,

International cooperation for education.

e) Space Policies, Law and Regulations, which

include 4 subfields namely Space policies, Space

law, Space regulations, Space Law Research

Center,

f) Capacity Building which includes 5 sub-fields,

namely Data and information sharing and service

capacity, Mission planning and implementation

capacity, Infrastructure construction and

management capacity, Standardization and policy

coordination capacity, Space education and

training capacity.

2.2 Benefit and Cost Analysis

Cost-benefit analysis (CBA) is the method used by

economists to evaluate public policies (Belfield,

Clive., 2012). CBA is a policy assessment method

that quantifies the value to a given agency of public

policy impacts and consequences in monetary terms

with the goal being to help effective social decision

Partnership Valuation of Membership of Indonesia in Asia Pasiﬁc Space Cooperation Organization (APSCO) with STPLEE

241

making through efficient allocation of society’s

resources when markets fail (Boardman et al., 2006;

Adler & Posner, 2006). BCA method is in principle

almost the same as the CBA, which is relatively

simpler. Cost Reviews (BCR) benefits are not

complex and more comprehensive so they can cover

the lack of costs and benefits from a monetary

perspective (FEMA, 2007).

3 METHODS

The methode in this paper was descriptive qualitative

and quantitative analysis with benefit cost review.

Loeb, Susanna, et al. (2017) said that descriptive

analysis characterizes the world or a phenomenon to

answering questions about who, what, where, when,

and to what extent, and the goal is to identify and

describe trends, aimed at identifying causal effects,

description plays a critical role in the scientific

process in general.

The data sources were primary and secondary

data. This study modifies FEMA (2007) in benefit

and cost reviews method. The perspective of the

benefit cost from the multicriteria analysis in this

study was from sosial, technichal, political, legal,

economic and enviromental (STPLEE) factors

approach. The steps to conducting BCR are as

follows:

a) list identification;

b) identification benefits and cost reviews; and

c) action priority- qualitative and quantitative

approach.

At this stage a list of identified actions, identify

benefits and cost and assign priorities is carried out

by providing high, medium, and low ratings and

performance associated with the cooperation scheme.

Figure 1: Steps Benefit- Cost Reviews.

4 RESULT

Indonesia's membership in the APSCO organization

will provide benefits and costs that are tangible and

intangible.

4.1 Benefit

Membership in an organization will have an impact

on both the positive and negative rights and

obligations of member countries, including Indonesia

if it becomes ratified by the APSCO convention.

Some benefits if Indonesia becomes an APSCO

member country, as follows:

 rights obtained Indonesia to participate in

programs related to the development of space

technology,

 Indonesia's membership in APSCO will certainly

enhance bilateral relations between APSCO

member countries in terms of space transfer of

technology. The joining of Indonesia in APSCO

can facilitate the realization of bilateral

cooperation among APSCO member countries,

such as cooperation between Indonesia and China

through LAPAN and the China National Space

Agency (CNSA) which aims to improve the

development of national space research &

development (LAPAN, 2018), and

 the right as a member country is also having the

same voting rights, participation in the program

and proposing Indonesian representatives in the

administrative position of the organization.

(LAPAN, 2018; and Nasution, Husni., et al.

2018),

 income in salary (LAPAN, 2018, and Nasution,

Husni et. All, 2018), or other benefit likes health

insurance, or fasilities for Indonesian staff

working at APSCO,

 participating in promotions and exhibitions

related to space technology in the APSCO

program as part of share and management

marketing, and

 extending the organization to improve efficiency

and bargain position, and other.

4.2 Cost

As a member state, the obligations related to the

funding contribution of the APSCO program are

regulated in the provisions of Article 18 (APSCO,

2005). Membership at APSCO has an impact on the

financial consequences of annual fees. APSCO's

annual fee uses to calculate the scale of contribution

by member countries using GDP and population data

issued / published by the World Bank. The results of

the calculation of the contribution (%) of each

member country by using the basis of data taken from

the World Bank are as follows:

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242

According Table 1, there is a deviation from the

percentage of Indonesia's contribution if it is a

member state of 0.07 percent, where the value will

change every 3 years or other conditions such as (i)

the existence of new member countries, (ii)

macroeconomic conditions of each country

(exchange rates against the US dollar, gross domestic

product, total population), and (iii) increasing

activity. The contribution of each member state,

including Indonesia, will be changed annually

according to the scale of APSCO's annual fee for

basic activities and if additional for optional

activities. Differences in the calculation of the scale

of contributions from the previous 2 studies indicate

the possibility of misdata, so for the initial analysis

for the LAPAN report (2018a) use a version of

APSCO.

Table 1: Percentage of State Contributions of APSCO and

Indonesia Members 2015-2017 (USD).

Country

Persentage

(A)

APSCO

Versi

(B)

Deviation

(A-B)

Bangladesh 8 8 0

China 18 18 0

Iran, Islamic Rep. 10,11 9,08 1,03

Mongolia 4,61 4,19 0,42

Pakistan 8 8 0

Peru 7,63 7,99 -0,36

Thailand 7,52 7,87 -0,35

Turkey 15,12 15,75 -0,63

Indonesia 7,88 7,81 0,07

TOTAL 76,87 76,63 0,24

Source: LAPAN (2018), data processed

If we are assuming the amount and data are same

with planed expenditure in 2015, 2016, and 2017, that

if Indonesia becomes a member state it will have an

increasing annual fee (See Fig 1). The trend of

annulling fee slope is positif (increase), for staff,

basic activity and administrative expenditure.

LAPAN (2018a) has calculated Indonesia's annual

fee estimates in 2015-2017. From these calculations,

if 2015 is the base year, it will show how much

progress, the trend is increasing each year. This value

increases by 2.42 percent in 2016, and increase by

4.75 percent in 2017. Thus, if Indonesia will become

a member in 2019, then what needs to be anticipated

is an annual fee increase every year. This is based on

the provisions of member contributions that have

been arranged in the organization.

Source: LAPAN (2018a), data processed

Figure 2: Estimated Indonesian Annual Contribution to

APSCO (in IDR Million).

4.3 Benefit-cost Reviews

From Fig 2, the obligation of annual fees in the

calculation of 2017 is equal to 5,106 billion Rupiah.

Based on the assumption that if 2019 is the same

value that is paid to APSCO, then the need to see the

priority of how important benefits can be taken from

the membership. In Table 2, the priority of benefits

and costs can be seen from the social, technical,

political, legal, economic and environmental aspects.

Table 2: Prioritization using STPLEE.

Action

Criteria

Basic Activit

BENEFIT COST

Sosial L M

Technical H L

Political M L

al M H

Economic L H

Enviromental L L

Definition: H-High, M-Medium, L-Low

Source: data processed

The finding in these studies, Indonesia has created

high benefits from technical aspects, medium benefits

from political and legal aspects and low benefits from

social, economic and environment aspect. From this

membership will have an impact to cost, that high

cost from legal and economic aspects, medium cost

from the social aspect, and low cost from the

environment, technical, and politic aspects (see Table

2). The high priority of technical factor is based on

the benefits that can be obtained, from the basic

activity program can support in terms of collaborative

research collaboration and increase capacity building

for mastering space technology. So, it can be

concluded that utilization that has technical benefits

must be optimized from the organization. This is

because on a cost basis, it has high consequences

from economic and political aspects.

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243

From a cost and benefit perspective it can be

assumed to have an equal score (costs (-3) = benefits

(3)), and this benefit can be greater. LAPAN reports

(2018) shows that the benefits of Indonesia's

membership to APSCO are greater than the costs

incurred. However, there are other costs and benefits

that are not measurable, intangible, where the value

will be greater. Table 3, it can be seen that technically

the benefits from APSCO are highest, followed by

legal benefits, while in terms of costs they have

consequences on costs from technical, legal and

economic aspects (see Tabel 3).

Table 3: Valuation Benefits and Cost.

Action

Criteria

Basic Activity

BENEFIT COST

Sosial 0 0

Technical 2 1

Political 0 0

Legal 1 1

Economic 0 1

Enviromental 0 0

Sub Total Of

Cost/ Benefi

3 3

Definition: 2=Very beneficial, 1=Favorable, 0=None/Not

applicable, -1=Not Favorable

Source: data processed

Table 4: Priority Action from Benefit and Cost Reviews.

Action

Criteria

Basic Activity

Benefi

Cos

Priority

Sosial

 Increase the

bargaining

position as

member states

and organization

 Improving data

sharing to

mitigation

 none

Technic

 Use of research in

the fields of

regulation, space

law, the science

between

examinations,

space

technology,

space

applications

 Capacity building

(short training

course, degree

education

program, etc)

 Admini

strative

support

progra

 Resear

ch in

domest

ic to

transfer

knowle

dge

Political

 APSCO as a

forum to

establish

connectivity with

member states

and open bilateral

cooperation

etween partners

 politic

cost

(no

data

availab

le yet)

Action

Criteria

Basic Activity

Benefi

Cos

Priority

to obtain the

transfer of

technology

 increasing

national pride

Legal

 Indonesia has

the right to

determine

policies and make

decisions about

APSCO

 admini

strative

(additi

onal

regulat

ory

require

ments

nationa

legislat

ion)

Econom

 Salary if

occupying a

strategic position

in the

administration

 Savings budget

space savings in

asic activity

 annual

fee

Envirom

ental

 Encouraging

stability in the

Asia Pacific

Region

(no data

available

yet)

Source: data processed

In Table 4, it shows the priority scale, so to

optimize the benefits of Indonesian membership at

APSCO it is necessary to actively participate in the

use of the forum for technical needs, and support

national space programs. This is because annual fees

that have to be spent are very large compared to other

international organizations. To optimize the benefits

and cost reviews of this membership, the strategies

that must be taken are:

a) national coordination related to involving

academics, industry and government for

opportunities for participation and collaboration

from the cooperation offered,

b) active participation in APSCO;

c) utilize rights in organizations in accordance with

national interests; and

d) sets a national roadmap related to the APSCO

program.

5 CONCLUSSION

From this study, Indonesia's membership in APSCO

can conclude that the benefits and costs obtained are

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244

both tangible and intangible thats not come from only

one aspect but many aspects such as social, technical,

legal, political, economic and environmental. From a

qualitative valuation, technical benefits are the

highest priority, followed by legal and political

aspects as a medium priority. From weigthing score,

the benefits and costs of this membership can be

equal, or greater by optimizing action in the

organization. Then from benefit and cost reviews

based on the multicriteria valuation, the technical

benefits are the basis of the first priority, followed by

sequential economic, legal, political, social and

environmental in determining Indonesia membership

in APSCO.

ACKNOWLEDGEMENTS

Thank You for Dr. Mardianis, and my partner at

POKLIT 1 for supporting data and information in this

paper.

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