On 22 June 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic topics such as an analysis of the rupiah performance, forecasts for inflation and the trade balance, the presidential election, governance in the mining industry, and more.

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On 15 June 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic topics such as the central bank’s benchmark interest rate policy, car sales, foreign investment, a rupiah exchange rate update, the latest news concerning the presidential elections of 2014, and more.

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The Governor of Indonesia’s central bank (Bank Indonesia), Agus Martowardojo, expects that the country’s trade balance will post a surplus of around USD $600 million in April 2014, roughly similar to the surplus that was recorded one month earlier (USD $673 million). The April 2014 surplus would be supported by an improvement in non-oil & gas exports, stable commodity prices (particularly coal and crude palm oil/CPO), as well as the waning influence of the Minerba Act.

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It was decided at the Board of Governors' Meeting (on 13 March 2014) to hold the benchmark interest rate (BI rate) at 7.50 percent, the lending facility rate at 7.50 percent and the deposit facility rate at 5.75 percent. The policy is consistent with ongoing efforts to guide inflation back towards its target corridor of 4.5±1 percent in 2014 and 4.0±1 percent in 2015, as well as to reduce the current account deficit to a more sustainable level. Recent developments indicate that the rate of inflation is under control and the current account deficit is shrinking.

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Mahendra Siregar, Chairman of the Indonesia Investment Coordinating Board (BKPM) said that Japan has replaced Singapore as the largest investor in Indonesia. In 2013, Japan invested USD $4.7 billion in Southeast Asia's largest economy, particularly in the automotive sector due to the sector's promising outlook as demand for cars among Indonesia's expanding middle class grows strongly. Singapore, which was the largest investor in Indonesia between 2010 and 2012, fell to second place with USD $4.6 billion worth of investments.

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Head of the Indonesia Investment Coordinating Board (BKPM), Mahendra Siregar, is optimistic that total realized investments in Indonesia will exceed the target that is set for this year. The BKPM, a government institution, aims for investments worth of IDR 390 trillion (USD $32.5 billion) in 2013 and IDR 470 trillion (USD $39.2 billion) in 2014. Siregar is optimistic because many investors, particularly from Japan and the USA, are committed to engage in business expansion at the end of this year as well as next year.

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Today (06/11), Statistics Indonesia announced that Indonesia's gross domestic product (GDP) expanded 5.62 percent in the third quarter of 2013 from the same period in 2012. The result implies the continuation of Indonesia's slowing economic growth as Q3-2013 constitutes the fifth consecutive quarter in which the country recorded slowing economic growth. Previously, the government had already expressed its concern about the GDP growth figure in Q3-2013 because the current high inflation rate curbs household consumption.

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After two days of demonstrations by tens of thousands of Indonesian workers, the Governor of Jakarta (Joko Widodo) raised the capital's minimum wage to IDR 2.4 million (USD $213) per month. The new minimum wage, proposed by the Jakarta Wage Council, will be implemented in 2014 and constitutes a 10% increase from the current minimum wage of IDR 2.2 million. The workers, however, had demanded for a minimum wage of IDR 3.7 million causing various institutions and analysts to express concerns about the impact on the investment climate.

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On Monday (28/10), another large-scale demonstration took place in the center of Jakarta, Indonesia's capital city. The workers that participated in the strike demanded a new minimum wage for Jakarta's provincial government due to the country's recent high inflation rate after prices of subsidized fuels were raised in June 2013, thus curbing people's purchasing power. The workers demand for the new minimum wage of IDR 3.7 million (USD $327) per month. However, these developments can hurt the investment climate in Indonesia.

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Finance Ministers of the Asia-Pacific Economic Cooperation (APEC) economies convened its 20th annual meeting in Nusa Dua, Bali, Indonesia, on 19 and 20 September 2013 under the Chairmanship of Dr. Muhamad Chatib Basri, Indonesia's Finance Minister. The meeting was attended by various delegates, including the President of the Asian Development Bank (ADB), the Managing Director of the World Bank Group, and the Deputy Managing Director of the International Monetary Fund (IMF).

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On 5 May 2020 Statistics Indonesia (Badan Pusat Statistik, BPS), a non-departmental government agency, released the first quarter gross domestic product (GDP) data of Indonesia for the year 2020. These data were highly anticipated as policymakers, analysts, and stakeholders are particularly interested in finding out to what extent damage has been done to the Indonesian economy by the self-imposed restrictions.

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Our assistance intends to connect you with the reliable and proper partners to fulfill your institution’s goals. To find a reliable partner is very challenging since Indonesia generally puts more emphasis on personal relationships and less on formal business agreements. Qualified local partners will not take international institutions seriously unless these institutions are committed to visiting Indonesia on a regular basis. Patience, persistence and presence are key factors for successful entry strategies into the Indonesian market.

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On 15 October 2019 the first edition of the ‘Indonesia Trade & Investment Summit’ was held at the Ritz Carlton ballroom at Pacific Place Jakarta in the Sudirman Central Business District (located in South Jakarta).

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In late-July 2019 Indonesia’s Investment Coordinating Board (BKPM) released the latest direct investment data of Indonesia. The data give rise to some optimism, albeit – generally speaking – direct investment realization comes from a low base in Indonesia (and non-optimal investment realization means the whole economy is not running optimally).

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In early May 2019 Indonesia’s statistics agency (in Indonesian: Badan Pusat Statistik, or BPS) announced that the nation’s economic growth pace was recorded at 5.07 percent year-on-year (y/y) in the first quarter of 2019.

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Based on data from the Indonesia Investment Coordinating Board (BKPM), total direct investment realization in full-year 2018 reached IDR 721.3 trillion, up 4.1 percent compared to the preceding year. However, it means that the government’s investment target of IDR 765 trillion was not achieved.

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Based on the latest data from IHS Markit, the headline seasonally adjusted Nikkei Indonesia Manufacturing Purchasing Managers’ Index (PMI) fell modestly to a reading of 50.5 in October 2018 (from 50.7 in the preceding month). The reading represents a marginal improvement in the health of Indonesia’s manufacturing sector.

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Based on the latest data from Indonesia’s Investment Coordinating Board (BKPM), total direct investment (foreign direct investment + domestic direct investment) in Indonesia was rather subdued in the second quarter of 2018, rising by a modest 3.1 percent year-on-year (y/y) to IDR 173.6 trillion (approx. USD $13.1 billion, using the IDR 13,400 per US dollar exchange rate that was set in the 2018 State Budget). As a consequence, Indonesia only achieved 47.3 percent of its full-year 2018 investment realization target in the first half of 2018, thus chances are rather big that the full-year target will not be achieved. It would be the first time Southeast Asia’s largest economy misses its investment realization target in many years.

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Investors are awaiting a series of fiscal incentives from the Indonesian government, including a new tax holiday. Meanwhile, investors also urge the government to improve the investment and business climate by simplifying the process and procedures to obtain permits for investment projects. This also includes improving the coordination between central and regional authorities, for example through the integration of the permitting process at both levels.

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Adhi Lukman, Chairman of the Indonesian Food and Beverage Association (Gapmmi), says he is optimistic that the investment targets that are set by Indonesia's Industry Ministry will be met this year. The Industry Ministry targets to see a total of IDR 63.25 trillion (approx. USD $4.6 billion) worth of private sector investment in the food and beverage industry of Indonesia, up 6.7 percent compared to investment realization in this industry one year earlier.

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