Indonesia trillion dollar economy in 2015, rajiv biswas
Upcoming SlideShare
Loading in...5
×
 

Indonesia trillion dollar economy in 2015, rajiv biswas

on

  • 332 views

 

Statistics

Views

Total Views
332
Views on SlideShare
307
Embed Views
25

Actions

Likes
0
Downloads
8
Comments
0

1 Embed 25

https://twitter.com 25

Accessibility

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

Indonesia trillion dollar economy in 2015, rajiv biswas Indonesia trillion dollar economy in 2015, rajiv biswas Document Transcript

  • Greetings, New analysis on Indonesia becoming a trillion dollar economy by 2015 follows from Rajiv Biswas, Asia-Pacific Chief Economist for IHS, speaking about the Indonesian Post-Election Economic Outlook at the IHS Singapore Forum on June 11th. Please feel free to quote from his analysis. Rajiv will be at the IHS Singapore Forum and is available for further interviews and comment. Contact: Rajiv.Biswas@ihs.com | press@ihs.com Indonesian Economy to More than Double over Next Decade; Country to become Trillion Dollar Economy by 2015 By Rajiv Biswas, Asia-Pacific Chief Economist, IHS Key points:  Size of Indonesian economy to more than double in next ten years to become a USD2 trillion economy by 2022  Indonesia is forecast to become a trillion dollar economy by 2015, becoming the sixth country in APAC to become a USD trillion dollar economy.  The Indonesian economy has emerged like a phoenix from the ashes after the East Asian crisis, and has undergone a remarkable transformation over the last decade under President Yudhoyono’s two terms of office.
  •  The size of Indonesia’s consumer market will more than double over the next decade, from USD 500 billion in 2013 to USD 1,300 billion by 2023  Economy forecast to grow at 5.2% in 2014 and 5.5% in 2015 Analysis: The Indonesian economy was shown a remarkable improvement in its macroeconomic performance over the last decade under President Yudhoyono’s two terms of office. The Indonesian economy has shown sustained strong growth over the last decade, and has the capacity for sustained long-term economic growth of around 5.0 to 5.5% per year over the 2015 to 2024 time horizon. This will transform the Indonesian economy from its current $880 billion GDP size to a $1 trillion economy by 2015, with the size of GDP doubling to $2 trillion by 2022. IHS forecasts that total GDP per person in Indonesia will rise from around $3,500 in 2014 to around $8,500 by 2024. This has considerable implications for the size of the Indonesian consumer economy. The size of Indonesia’s consumer market is forecast to more than double over the next decade, from USD 500 billion in 2013 to USD 1,300 billion by 2023. Infrastructure and manufacturing will be new economic growth drivers A key priority for the next Indonesian government that takes office after the upcoming Presidential election should be to accelerate the development of infrastructure, including power generation, roads, ports and airports over the next five years through both increased government capital spending as well as leveraging
  • public-private partnerships. Indonesia also has the potential for significant further development as a low-cost manufacturing hub in East Asia, particularly since wage costs are rising rapidly in China’s coastal provinces and multinationals are seeking new low-cost locations for locating their manufacturing plants in lower- value added segments of manufacturing. Reflecting Indonesia’s improved macroeconomic performance and fast-growing domestic demand, foreign direct investment inflows into Indonesia have more than doubled since the global financial crisis in 2008-09, rising from around USD 15 billion in 2010 to USD 35 billion in 2013. Key challenges Despite the favourable economic performance over the last decade under President Yudhoyono’s presidency, Indonesia still needs to tackle major economic development challenges. A key priority facing the next government will be to further improve the business climate for investment, with Indonesia currently ranked 120 on the World Bank’s Ease of Doing Business Index, compared with other ASEAN competitors such as Malaysia which is ranked 6th, Thailand which is ranked 18th and even Vietnam, which is ranked 99th. A key concern for investors in the resources sector relates to the partial ban imposed by Indonesia earlier this year on unprocessed mineral exports, which are having negative effects on exports and fiscal revenues in the near-term. The policies of the next government regarding mineral exports will therefore be a key focus for foreign investors. View slide
  • Indonesia continues to face other economic development challenges, with poverty and unemployment remaining high. An estimated 29 million Indonesians still live in poverty, which is around 12% of the total Indonesian population. Large numbers of new workers are also entering the workforce each year, with a total of around 15 million new workers expected to join the labour force between 2014 and 2020.The next Indonesian government will therefore face considerable economic challenges in order to generate sufficient jobs growth to create sufficient new employment for youth entering the workforce. The new Indonesian government that takes office after the Presidential elections will therefore inherit an economy that has achieved tremendous economic progress over the last decade under President Yudhoyono, but also faces some tremendous economic development challenges over their next five-year term of office. For Indonesia to maintain a strong growth path, a critical priority for the next government will be to accelerate the pace of microeconomic reforms, with infrastructure development in power generation, ports, roads and airports, as well as improving the business climate for both domestic and foreign manufacturing and service firms, and avoiding protectionist policies that will hamper economic growth. If the next government is able to accelerate the pace of these reforms, it could lift Indonesia’s long-term potential growth rate to above 6.0% per year. Rajiv Biswas Asia-Pacific Chief Economist, IHS rajiv.biswas@ihs.com View slide
  • Danny Cheung Asia Pacific Director Corporate Communications 8 Marina View #12-01 | Asia Square Tower 1 | Singapore Phone: +65 6439 6192 | Mobile: +65 9171 3200 Danny.Cheung@ihs.com This email message is for the sole use of the intended recipient(s) and may contain confidential and privileged information. Any unauthorized review, use, disclosure or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail and destroy all copies of the original message. Thank you.  Please consider the environment before printing this e-mail.