Moody's Investors Service, one of the big credit rating agencies, stated in its 'Credit Analysis: Indonesia' report that - despite the ongoing current account deficit (which is considered to be structural) and a relatively shallow and volatile domestic capital market (which contributes to Indonesia’s reliance on external funding) - the agency is positive about Indonesia's outlook due to its growth prospects, narrow fiscal deficits and low public debt. Indonesian government bonds are rated at Baa3, which is Moody's lowest investment-grade status.

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A countrywide survey conducted by the Indonesia Research Center (IRC) in late September 2013 ranked the PDI-P (Partai Demokrasi Indonesia Perjuangan) and the Golkar party on top of the poll ahead of the legislative elections that are scheduled for April 2014. In the survey, the PDI-P received 19.6 percent of the votes, while Golkar came in second with 16.3 percent. Both these parties have a long history in Indonesian politics and their popularity indicate that Indonesians seem to favour "old school" political parties.

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The Indonesia Stock Exchange expects that 30 companies will conduct their initial public offering (IPO) on the Indonesia Stock Exchange (IDX) in 2014. This target is the same as the target that had been set for this year. Next year, legislative and political elections in Indonesia will bring some uncertainties to the Indonesian market and may be a reason for some companies to postpone the IPO. Up to now, six companies have announced to conduct their IPO in 2014. In 2013 so far, 25 companies have been newly listed on the IDX.

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Singapore-based DBS Group, a leading financial services group in Asia, expects Indonesia's gross domestic product (GDP) growth to reach 5.8 percent in 2013, while it forecasts growth of 6.0 percent in 2014. This year, Indonesia has to cope with ups and downs due to several domestic and foreign factors. According to the institution, two issues stand out as being significantly influential this year. These are the government's decision to increase prices of subsidized fuels in late June and the country's sharply depreciating rupiah.

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Attracted by the promising prospects of Indonesia's domestic consumption (with per capita GDP rising strongly), a total of about 100 foreign franchises will enter the Indonesian market in 2013. The most popular investment destination of these franchises is Indonesia's culinary sector. The majority of franchises originate from the United States. Others include those from South Korea, Japan, Australia and Europe. In 2013 so far, more than 170 foreign franchises received approval from the government.

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The International Monetary Fund (IMF) expects the economy of Indonesia to expand by 5.25 percent in 2013, which is considerably lower than the IMF's earlier forecast. In its World Economic Outlook, released in April 2013, the institution set economic growth of Indonesia at 6.3 percent. However, after emerging markets were hit by large capital outflows when the Federal Reserve began to speculate about an end to its quantitative easing program (QE3), Indonesia's GDP growth assumptions were quickly revised downwards.

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Spending on advertisement in Indonesia's media in the first six months of 2013 has grown 25 percent to IDR 51.16 trillion (USD $4.65 billion) compared to the same period last year. This sharp increase was supported by a six percent rise in advertising volume to 3.5 million advertising spots (advertising space) on television, and in newspapers and magazines. With about 68 percent of total spending, television generates most of the country's advertisement spending, followed by newspapers (30 percent) and magazines/tabloids (2 percent).

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The macroeconomic assumptions that have been formulated in the 2014 State Budget Draft by the government of Indonesia are not considered too realistic by several analysts. Although it is understood that one should set a high standard in order to maximize efforts, analysts feel that - given the current problematic economic context in Asian emerging economies as well as global economic turmoil - the government is far too optimistic, particularly because the government will have to devote part of its attention to the elections in mid-2014.

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According to a new survey, the Democratic Party (Partai Demokrat), the political vehicle of president Susilo Bambang Yudhoyono, is increasingly losing popular support. The survey indicates that currently only 7.1 percent of respondents will vote for the Democratic Party in next year's legislative elections. The survey was conducted by the Center for Strategic and International Studies (CSIS) and involved 1,635 respondents from 31 provinces. In combination with results of earlier surveys in the last 12 months, it shows declining support for the party.

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According to Ferry Salanto, Associate Research Director at Colliers International Indonesia, the weakening rupiah exchange rate against the US dollar in recent months has resulted in an increase of property sales in Indonesia, particularly apartments. Salanto says it is not just an investment for the buyer but also a matter of security. Property is currently a better and safer alternative to the holding of rupiahs. In the third quarter of 2013, property sales increased despite the higher benchmark interest rate and the tightening property credit environment.

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Spending on advertising in Indonesia is expected to jump 20 percent to IDR 140 trillion (USD $12.4 billion) in 2014. This expected growth is mainly the result of increased spending due to Indonesia's legislative and presidential elections as well as the 2014 FIFA World Cup in Brazil. The former means that Indonesian political parties will increase spending to reap popularity through media exposure, while the latter will draw millions of spectators and readers due to the popularity of football in Indonesia and thus becomes interesting for advertisers.

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If presidential elections were to be held today, it is probable that Prabowo Subianto would be chosen by the Indonesian electorate to become Indonesia's next president. Various surveys indicate that Prabowo, a former high military officer as well as a successful businessman, is the most popular person to replace incumbent president Susilo Bambang Yudhoyono in mid 2014 when new presidential elections will be held (which are not joined by Yudhoyono as he is finishing his second and final term as president).

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Although Indonesia’s next presidential election will be held in mid-2014, Aburizal Bakrie already announced in 2012 that he would run for the presidency on behalf of the Golkar party, one of the leading political parties of Indonesia and once the strong political vehicle of Suharto during the New Order regime (1965-1998). However, Bakrie, chairman of Golkar and often referred to by his nickname 'Ical', is one of the most controversial figures in modern Indonesian politics and business.

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Various high government officials, including president Susilo Bambang Yudhoyono, Finance minister Agus Martowardojo and National Development Planning minister Armida Alisjahbana stated that Indonesia's economy is estimated to grow between 6.3 and 6.8 percent in 2014. Its main economic pillars of support are thought to be (foreign and domestic) investments, domestic consumption, and government expenditure. Poverty is targeted to be reduced to ten percent of the population.

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Last Saturday, the Democratic Party (PD) selected Indonesia's president Susilo Bambang Yudhoyono as the new chairman of the crumbling political party through an extraordinary congress in Bali. Yudhoyono thus replaced former chairman Anas Urbaningrum, who resigned from his post last month after being accused of involvement in a corruption case. It will be Yudhoyono's task to repair the image of his PD party, while still performing his duties as president.

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Yesterday Lembaga Survei Indonesia (LSI), a leading Indonesian public opinion research institute, published the result of a survey that indicated Megawati Soekarnoputri is leading the poll to become the country's next president in 2014. In the survey she is closely followed by Aburizal Bakrie and Prabowo Subianto. This preliminary result can be regarded negative as these names are 'products' of the old regime and thus will not support further democratization.

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