Let Us Help You Grow Your Business In Indonesia

About Indonesia

Indonesia’s population of 258 million makes it the fourth most populous country in the world. The country has a young, growing and rapidly urbanizing population that makes it one of the fastest growing consumer markets in the world. Its economy is ranked as the tenth largest in the world. Valued at US$ 941 billion, it is projected to grow by 5.5% in 2017.

The government has unveiled various measures to stimulate investment, strengthen competitiveness, and diversify the economy. Given its abundant natural resources; political stability; attractive investment climate; and strong focus on developing its infrastructure, Indonesia is poised to transform into a great economic power.

Population: 258.32 million
Inflation Rate: 3.8%
Currency: Indonesian Rupiah (IDR)
Ave Exchange Rate: IDR 13,483 : US$ 1
Imports: US$ 129.1 billion
Exports: US$ 144.4 billion
GDP: US$ 941 billion
GDP per capita (PPP) US$ 11,700
Real GDP Growth 5%
Icon contacts

Contacts

I am looking for

Icon insights

insights

INDUSTRY REPORTS

This report is designed to provide an overview of the medical technologies sector in Indonesia, which is valued at US$ 900 million. The country harbors ambitions to develop its local medtech sector, and local factories are starting to produce medical equipment such as laboratory tools, radiolo...

Price: US$ 600
View Detail

This report is designed to provide an overview of the smart cities sector in Indonesia. The country offers a number of opportunities in the smart city space, bolstered by its rapid urbanization and development. According to market research firm International Data Corporation (IDC), the Indones...

Price: US$ 600
View Detail

Indonesia Country Profile

The report offers a wide range of data and information collected from various sources that were built together in order to provide not just facts but deeper insights about the country. Unlike other country reports that focus more on macro-economic data, we think that the most valuable part of ...

Price: US$ 300
View Detail

This report is designed to provide an overview of the water and wastewater sector in Indonesia, which is facing multifaceted challenges, given that almost 40% of Indonesians have no access to adequate sanitation facilities, while a third do not have clean drinking water. The Indonesian governm...

Price: US$ 600
View Detail
View More
Icon insights

insights

business news

Icon 2
Container maritime cargo ports

ECONOMIC NEWS

Indonesia Increases Import Tax To Stabilize Currency

Indonesia  -  September 2018

The Indonesian government has been taking multiple steps to curb imports and support the weakening currency, which dropped to a 20-year low of nearly 14,800 (IDR/ USD) in early September 2018. While the central bank is intervening in the foreign exchange and bond markets and has raised benchmark interest rates four times since May 2018 to shore up the Rupiah, the government has been taking steps to curb imports. Indonesia has been among the most severely affected countries, apart from Turkey, Argentina and South Africa, by the emerging-market selloff, as investors move funds to the US to benefit from the US rates hike.

On 5 September, Indonesia’s Finance Minister Sri Mulyani Indrawati approved tax increase on imported goods. The Income Tax (Pph 22) increase for imported goods will impact 1,147 items, with rates rising to a maximum of 10% from the prevailing range of 2.5% to 7.5%.

For 210 items, rates rose from 7.5 % to 10%. Included in this category are luxury items such as CBU (Completely Built Up) cars, and large motorbikes. The import of luxury cars with engine capacity of 3.000 cc and above will be put to a halt. For a further 218 items, rates have been increased from 2.5% to 10%. This category includes consumer goods that can be produced domestically, such as electronic goods (water dispensers, air conditioners, lamps), daily necessities such as soap, shampoo, cosmetics, and cooking utensils / kitchen items. Taxes on 719 items rose from 2.5% to 7.5%. This includes building materials (ceramics), tires, audio-visual electronic equipment (cables, speaker boxes ), textile products ( overcoat , polo shirts , swim wear etc. 

The move by the Indonesian government is to complement other measures which have been put in force to narrow the current-account deficit, including using palm oil biodiesel to reduce imports of crude, delaying infrastructure investment and rescheduling shipments. 

(Sources: Ministry of finance, Indonesia; Bloomberg; The Jakarta Post; Straits Times; Nikkei Asian Review)

Icon 3
Big data iot internet

ICT

Salim Group And Keppel To Jointly Develop Data Center In Indonesia

Indonesia  -  September 2018

The Salim Group and the Keppel Group, through the Alpha Data Centre Fund (Alpha DC Fund), managed by Alpha Investment Partners Limited (Alpha), and Keppel Data Centres Holding Pte Ltd (Keppel Data Centres), have signed conditional agreements to develop and operate a high-availability data centre in Bogor, outside of Jakarta, Indonesia. Dubbed IndoKeppel Data Centre 1 (IKDC) 1 will be developed and operated by a 60:40 joint venture between the Salim Group and Keppel Data Centres. The facility development will be in three phases. The data centre will have a gross floor area of approximately 105,300 sq ft with Tier 3 concurrent maintainability standards for power and cooling. The construction of the core and shell of the data centre, as well as the first phase fit-out, is expected to be completed by the first half of 2020. This will be the first phase of a larger 7ha data centre campus development.

IKDC 1 and its underlying 3ha land plot will be held by a 60:40 joint venture between the Salim Group and the Alpha DC Fund respectively. The Alpha DC Fund is a USD 1 billion real estate private fund investing in data centres in Asia Pacific and Europe. 

The Salim Group has been keen on expanding its Salim Digital Ecosystem to support the nation’s transformation to Indonesia Industry 4.0. One of Indonesia's biggest conglomerates with interests ranging from food, banking and telecommunications, the Salim Group currently owns and operates a data centre in Indonesia serving financial institutions and enterprise customers. It also has fibre optics cables laid out all across Sumatra, Java all the way to Bali. The conglomerate has also invested in submarine cables from Java to Singapore.The collaboration bring the Salim Group's experience together with the Keppel Group's established track record in owning, developing and operating high-availability data centres across the Asia Pacific and Europe, the collaboration pools both groups' expertise for the construction, fit-out and subsequent operation and maintenance of the data centre.

Indonesia’s data centre services market is one of the fastest growing in the region with a compound annual growth rate (CAGR) of 35%. This is largely supported by data onshoring regulations, increased smartphone adoption and the growing popularity of e-commerce.

(Source: Business Times, Kepcorp)

Icon 4
Biofuel

ENERGY

Indonesian Government Expanding Biodiesel Subsidies

Indonesia  -  September 2018

Indonesia's President Joko Widodo signed a revised regulation for the Estate Crop Fund (BPDPKS) to support the country’s B20 Biodiesel Policy, which mandates all diesel in Indonesia to have a 20% bio-component, usually derived from palm oil, starting from September 2018. The new regulation will absorb excess supply of palm products in the market, as well as reduce Indonesia’s dependency on diesel fuel imports. 

BPDPKS was formed in July 2015 with the aim of managing the income derived from levies on exporters of palm oil commodities. Part of the funds are used to subsidize biodiesel, which is more expensive to produce as compared to petroleum diesel. To break even on production costs, biodiesel has to be sold at over IDR 9,000 (USD 0.61) a liter, while petroleum diesel currently costs around IDR 5,150 (USD 0.35) a liter. 

This revision expands the fund’s ability to subsidize the price gap between biodiesel and petroleum-based diesel. Earlier, the fund was limited to subsidize Public Service Obligation (PSO) sectors, such as certain transport and power stations. The fund collected IDR 14.2 trillion rupiah (USD 972 million) in levies last year, and provided subsidies on 2.3 million kiloliters of biodiesel.

Under the new rule, 19 biodiesel producers such as Wilmar and the Sinar Mas Group, will receive incentives to narrow the pricing gap between PSO and non-PSO sectors. 

The fund would require up to IDR 9.8 trillion (USD 672 million) to subsidize the production of 3.2 million kiloliters of biofuel for 2018. The government estimates that the policy would raise biodiesel consumption to between 5.5 million to 6 million kiloliters in 2019 from 4 million kiloliters on 2018. This is expected to help reduce fuel imports and bring down the current account deficit by around USD 6 billion per year. 

(Sources: Reuters; Jakarta Globe)

Icon 6
Medication pills

MEDICAL

Indonesian Regulation To Mandate Local Content For Pharmaceuticals

Indonesia  -  September 2018

Indonesia proposes a new regulation which could set a content requirement for raw materials at a minimum of 30%, with active ingredients comprising of 70% of that and additional ingredients 30%. The local content requirement will vary for each manufacturing stage and development process. It is expected to be finalized by sometime this year.

This is following the Presidential Directive No. 6/ 2016 on the Acceleration of the Development of the Pharmaceutical and Medical Equipment Industry. This is also backed by Minister of Health Regulation No. 17/2017 regarding Action Plan for the Development of the Pharmaceutical and Medical Equipment Industry.

Indonesia has long been reliant on imported materials for the development of its pharmaceutical industry. Only 10% of materials are sourced from domestic producers. The Ministry of Industry aims to register around 20% of local components. The new regulation aims to attract investors to set up manufacturing plants to produce and process pharmaceutical products in Indonesia.

(Source: Lexology)

Icon 7
Pipes

ENVIRONMENT

Chillers Installed At Pharma Factory Under German Funded Sustainability Initiative

Indonesia  -  September 2018

PT Phapros, a large Indonesian pharmaceutical company, has installed two propane (R290) chillers at its production facility in Semarang, Central Java. The R290 chillers were produced by a local company, Air Conditioning and Chiller (AICOOL). The new chillers will save the company about IDR 440 million (USD 26,300) per year and use approximately 151.078 kWh of electricity per year, as compared to its existing R134a units which needs 545.387 kWh of electricity per year.

The commissioning of R290 is part of the Green Chillers Nationally Appropriate Mitigation Action (NAMA) project. It is a sustainability initiative launched by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) in Indonesia in 2014. The project is supported by the Directorate General of New and Renewable Energy and Energy Conservation (EBTKE), Ministry of Energy and Mineral Resources (MEMR) and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).

The goal of the project is to excite the development of green cooling technologies in Indonesia through pilot projects, training, certification and creating standards. MEMR aims to include more industries to embrace hydrocarbon-based technology because of its energy efficiency.

(Source: Hydrocarbons21) 

Icon 8
Highway

INFRASTRUCTURE

Indonesia Courting Chinese Investors For Infrastructure Projects

Indonesia  -  September 2018

Indonesia unveiled  infrastructure projects worth an estimated USD 13.2 billion during a market sounding event in Guangzhou in southern China. The event was organized through cooperation between the Indonesian Investment Coordination Agency (BKPM) and the country's Consulate General in Guangzhou. The projects on offer include power plants under the independent power producer (IPP) scheme and toll roads. 

Indonesia is actively looking for domestic and international investors to take part in these projects and it is providing support in the form of guarantees and also, fiscal and non-fiscal incentives. Through the infrastructure financing guarantee agency PT Penjaminan Infrastruktur Inodnesia (PII), Indonesia government has the ability to give guarantees for any companies who are eager to take part in the government-to-business cooperation (KPBU) scheme. 

Since January 2016, the Beijing-based Asian Infrastructure Investment Bank (AIIB) has approved  loans amounting to USD 691.5 million for four infrastructure projects in Indonesia: two irrigation improvement projects, a slum improvement and a regional infrastructure development fund. The loans are co-financed with the World Bank and the Indonesian government. AIIB is also currently finalizing the approval process of another USD 260 million loan for the Mandalika urban and tourism infrastructure development on Lombok Island. Mandalika Resort Area is an under-construction integrated resort area in the island of Lombok, Indonesia. It is designated as a Special Economic Zone (KEK) on Mandalika Beach

(Sources: Straits Times; The Jakarta Post)

Icon 9
Manufacturing

MANUFACTURING

Indonesia Manufacturing Sector Expands In August

Indonesia  -  September 2018

Indonesia manufacturing sector witnessed the fastest growth in more than two years. The Nikkei Indonesia Manufacturing Purchasing Managers’ Index (PMI) jumped to 51.9 in August 2018 from 50.5. The manufacturing sector was boosted by the increase in domestic demand, offsetting the decline in export orders. To meet the growth in demand in new domestic orders, the manufacturing sector recorded the strongest job growth rates in nearly 7.5 years.

Purchasing activity in the manufacturing sector grew modestly for the seventh consecutive month in August, while pre-production inventories lagged behind. Export orders remained weak for a ninth straight month. Input costs have also been rising sharply due to the downwards pressure on Indonesian Rupiah against the US dollar. The one-year outlook sentiment for production in Indonesia's manufacturing sector strengthened to a three-month high in August.

(Sources: Indonesia Investments; Financial Times)

Missing
Jet 4

DEFENSE / AEROSPACE / AVIATION

Turkey And Indonesia Collaborate On UAV Development

Indonesia  -  September 2018

Turkish Aircraft Industries (TAI) has expanded its partnership with Indonesia’s state-owned aerospace firm PT Dirgantara Indonesia (PTDI) to develop a new medium-altitude long-endurance (MALE) unmanned aerial vehicle (UAV) for Indonesian Air Force (Tentara Nasional Indonesia – Angkatan Udara: TNI AU). The development will promote technology transfers from Turkey to Indonesia to support joint development and localized manufacturing. Through this collaboration, PTDI is seeking to reduce dependency on manufacturers in Western countries. 

This is in line with a previous agreement between the two parties signed on 17 January this year to develop the new UAV with an operating altitude of 40,000 feet. TAI has modified its MALE UAV, Anka, to meet Indonesian’s regulations by integrating Indonesian suppliers into its supply chain. The development would be finalized within one to three years. 

The UAV project follows on a framework signed by two companies on July 2017 to collaborate on PTDI’s N219 and N245 small and regional turboprop projects which are still under development.

(Sources: Jane’s 360; Ainonline)

Icon 5
Nuts grains produce

RETAIL / FMCG

Improved Access To Indonesian Markets For Australian Agriculture Products

Indonesia  -  September 2018

Australia recently completed negotiations with Indoensia for an extended economic partnership between the two countries. The Indonesia -Australia Comprehensive Economic Partnership Agreement (IA-CEPA) builds on commitments under existing free trade agreement, the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) across goods, services and investment. Over 99% of Australian goods exports by value to Indonesia will enter duty free or with significantly improved preferential arrangements. The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) will come into effect by 2020.

This will benefit Australian exporters greatly, particularly the Australian farmers. Indonesia will guarantee automatic issue of import permits for key products such as live cattle, frozen beef, sheep meat, feed grains, rolled steel coil, citrus products, carrots and potatoes. Import licences are a major barrier for many Australian exporters into Indonesia. 

Australian farmers will be able to export 500,000 tonnes of feed grains such as wheat into Indonesia tariff free and this will increase by 5% annually in volume. Tariff on frozen beef has been cut to 2.5% (from 5%) and there will be access for unlimited volume. The tariff will be eliminated after 5 years. 575,000 live cattles can be imported duty free in the first year, compared to the current 5% tariff. This will undergo 4% annual growth in volume reaching 700,000 by year 6. There will be a review for subsequent increases. Tariffs across a number of dairy lines have been reduced or eliminated and the remaining tariffs will be gradually removed. 

Apart from the food sector, the partnership will also elevate Australian industrial producers covering sectors such as steel, copper and plastics. The service industries including health, mining, telecommunications, tourism and education will be boosted through a guaranteed levels of Australian ownership.

As for Indonesia, IA-CEPA will immediately eliminate all remaining tariffs on Indonesian imports into Australia. The Australian government has also agreed upon a reciprocal Skills Exchange and encouraged further investment from Indonesia.

(Source: Australian Minister of Trade, Tourism and Investment; Australian Government Department of Foreign Affairs and Trade)

Companies

1   customized agent   distributor search

Customized Agent/ Distributor/Reseller Search

Having completed over 1000 customized agent/distributor/reseller searches for our clients over the years, this is one of the most popular trade services that we offer to potential clients. Typic...

Read more
5   sourcing services

Sourcing Services

There is a growing interest in sourcing for products from South East Asia for strategic and competitive reasons. Companies from around the world are looking for suppliers in Malaysia, Thailand, ...

Read more
4   business incorporation   site selection

Business Incorporation/ Site Selection

We counsel businesses on where to locate their office and industrial operations and what the optimal business structure should be to meet local government and tax requirements. Some of the quest...

Read more
3   market research

Market Research

To successfully export your products or services, you need to learn about your customers, your competitors and your industry. Our market research process starts off with brainstorming effective ...

Read more
2   trade show support

Trade Show Support

Many companies participate in trade shows hoping to find customers or local agents or distributors. However, they come away from these events with less than desired results. But with our trade s...

Read more
6   additional services

Additional Services

Based on past experience in helping companies that are looking to grow their exports to one or more markets in South East Asia, we have found that some of these additional services that we offer...

Read more

Economic Development Agencies & Trade Associations

7   trade mission organization

Trade Mission Organization

Visiting a market to meet with prospective customers or partners is essential as business is built on developing personal connections and understanding the local culture. Traveling ...

Read more
2   trade show support

Trade Show Support

Trade shows can be an excellent option for companies and trade organizations to make key business and industry connections overseas. But to maximize the benefit of participating in ...

Read more
8   trade representation

Trade Representation

With over 20 years of experience providing dedicated representation in South East Asia to economic development organizations (EDOs) from North America and Europe, we offer EDOs the ...

Read more
3   market research

Market Research

Our strong track record in performing a targeted analysis of specific industry sectors in multiple markets has helped many economic development organizations (EDOs) to develop strat...

Read more
9   investment attraction

Investment Attraction

Attracting investment from overseas can mean new or retained jobs in your area. Our investment attraction support services will position your economic development organization (EDO)...

Read more
6   additional services

Additional Services

Having worked with government agencies and trade associations for over 20 years, we also provide a range of additional services customized to the requirements of these organizations...

Read more
Icon classified

Companies seeking

distributors

COMPANIES SEEKING AGENTS/DISTRIBUTORS/RESELLERS IN Indonesia

Logo

ClaroNav Kolahi Inc.

Canada
Medical
Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam
NaviEnt is a simple, accurate and affordable Ear Nose Thr...
More Information
Logo

Ramsoft Inc

Canada
Medical
Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam
Customizable and flexible radiology software solutions, P...
More Information
Logo

Theralase® Technologies Inc

Canada
Medical; Others
Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam
The therapeutic laser is used to eliminate pain, reduce i...
More Information
Logo

NewDVR (S) Pte Ltd

Singapore
Building Products - Residential & Commercial; Infocomm Technologies (ICT); Safety & Security
Malaysia, Philippines, Thailand, Vietnam, Indonesia
Our products include Alarm Systems, Visitor Management Sy...
More Information
Logo

Pacer Pumps

USA
Agriculture & Livestock; Industrial Equipment & Parts; Others
Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam
Thermoplastic centrifugal pumps for these sectors - Agric...
More Information
Sol

Solace Corporation

Canada
Infocomm Technologies (ICT)
Indonesia, Malaysia, Philippines, Thailand, Vietnam
Message Router Appliances - Purpose-built hardware for me...
More Information
View More
Loading