indonesia - icsiindia.in · 2010, with the majority being sunni (99%). the shias and ahmadis...

1 ICSI – INTERNATIONAL CHAMBER FOR SERVICE INDUSTRY

INDONESIA

The Republic of Indonesia is the largest archipelago in the world comprising 13,466 large and

small tropical islands fringed with white sandy beaches, many still uninhabited and a number even

still unnamed. Straddling the equator, situated between the continents of Asia and Australia and

between the Pacific and the Indian Oceans, it is as wide as the United States from San Francisco

to New York, equaling the distance between London and Moscow. Indonesia has a total

population of more than 215 million people from more than 200 ethnic groups. The largest – and

politically dominant – ethnic group are the Javanese. The national language is Bahasa

Indonesia. Indonesia is a founding member of ASEAN (association of south east Asian region) and

a member of the G-20 major economies. The Indonesian economy is the world's 17th largest by

nominal GDP. Indonesia's national motto, "Bhinneka Tunggal Ika" ("Unity in Diversity" literally,

"many, yet one"), articulates the diversity that shapes the country.

Facts & Figures

National name: Republik Indonesia


Flag:

National Embelem:

Motto: "Bhinneka Tunggal Ika" - "Unity in Diversity"

National ideology: Pancasila

Current government officials:

Capital and largest city: Jakarta

Languages: Bahasa Indonesia (official), English, Dutch, Javanese, and more than 580 other

languages and dialects

Population -

2014 estimate 252,164,800

2011 census 237,424,363 (4th)


Density 124.66/km2 (84th) 322.87/sq mi

Ethnicity/race: Javanese 40.2%, Sundanese 15.5%, Malay 3.7%, Batak 3.6%, Madurese 3%,

Betawi 2.9%, Minangkabau 2.7%, Buginese 2.7%, Bantenese 2%, Banjarese 1.7%, Balinese 1.7%,

Acehnese 1.4%, Dayak 1.4%, Sasak 1.3%, Chinese 1.2%, other 15%

Religions: Muslim 87.1%, Christian 7%, Roman Catholic 2.9%, Hindu 1.7%, other 0.9% (includes

Buddhist and Confucian), unspecified 0.4%

National Holiday: Independence Day, August 17

Literacy rate: 92.8% (2011 est.)

Area –

Land:1,904,569 km2(15th)

735,358 sq mi

Water: (%) 4.85

Currency - Indonesian rupiah (Rp) (IDR)

Economic summary:

2014 estimate - Total $856.066 billion(17th) - Per capita $3,510 (120th)

GDP/PPP (2013 est.): $1.285 trillion; per capita $5,200. Real growth rate: 5.35%.

Inflation: 5.8%.

Unemployment: 5.50%.

Arable land: 12.34%.

Agriculture: rice, cassava (tapioca), peanuts, rubber, cocoa, coffee, palm oil, copra; poultry, beef,

pork, eggs

Labor force: 120 million (2013 est.); agriculture 38.9%, industry 13.2%, services 47.9% (2012

est.).

Industries: petroleum and natural gas, textiles, apparel, footwear, mining, cement, chemical

fertilizers, plywood, rubber, food, tourism.

Natural resources: petroleum, tin, natural gas, nickel, timber, bauxite, copper, fertile soils, coal,

gold, silver.

Exports: $178.9 billion (2013 est.): oil and gas, electrical appliances, plywood, textiles, rubber.

Imports: $1786 billion (2011 est.): machinery and equipment, chemicals, fuels, foodstuffs.


Major trading partners: Japan, U.S., Singapore, South Korea, China, Malaysia, India (2012).

Transportation:

Railways: total: 5,042 km (2011).

Roadways: total: 496,607 km; paved: 283,102 km; unpaved: 213,505 km (2011 est.).

Waterways: 21,579 km (2011).

Ports and terminals: Banjarmasin, Belawan, Kotabaru, Krueg Geukueh, Palembang, Panjang,

Sungai Pakning, Tanjung Perak, Tanjung Priok.

Airports: 673 (2013).

DEMOGRAPHY

According to the 2014 national census, the population of Indonesia is 252,164,800 with high

population growth at 1.9%. 58% of the population lives in Java,the world's most populous island.

Ethnicity

There are around 300 distinct native ethnic groups in Indonesia, and 742 different languages and

dialects. Most Indonesians are descended from Austronesian-speaking peoples whose languages

can be traced to Proto-Austronesian (PAn), which possibly originated in Taiwan. Another major

grouping are Melanesians, who inhabit eastern Indonesia. The largest ethnic group is the Javanese,

who comprise 42% of the population, and are politically and culturally dominant. The Sundanese,

ethnic Malays, and Madurese are the largest non-Javanese groups.

Javanese 40.1%, Sundanese 15.5%, Malay 3.7%, Batak 3.6%, Madurese 3%, Betawi 2.9%,

Minangkabau 2.7%, Buginese 2.7%, Bantenese 2%, Banjarese 1.7%, Balinese 1.7%, Acehnese

1.4%, Dayak 1.4%, Sasak 1.3%, Chinese 1.2%, other 15% (2010 est.)

Religion

While religious freedom is stipulated in the Indonesian constitution, the government officially

recognizes only six religions: Islam, Protestantism, Roman Catholicism, Hinduism, Buddhism,

and Confucianism. Indonesia is the world's most populous Muslim-majority nation, at 87.2% in

2010, with the majority being Sunni (99%). The Shias and Ahmadis respectively constitute 0.5%

and 0.2% of the Muslim population. Most Indonesian Hindus are Balinese, and most Buddhists in

modern-day Indonesia are ethnic Chinese. Though now minority religions, Hinduism and

Buddhism remain defining influences in Indonesian culture.

Muslim 87.2%,

Christian 7%,


Roman Catholic 2.9%,

Hindu 1.7%,

other 0.9% (includes Buddhist and Confucian),

unspecified 0.4%

Education

Education in Indonesia is compulsory for twelve years. Parents can choose between state-run, non-

sectarian public schools supervised by the Department of National Education (Depdiknas) or

private or semi-private religious (usually Islamic) schools supervised and financed by the

Department of Religious Affairs. The enrolment rate is 94% for primary education, 75% for

secondary education, and 27% for tertiary education. The literacy rate is 93% .

Top ten universities of Indonesia:

Institute of Technology Bandung (ITB)

University of Indonesia (UI)

Gadjah Mada University (UGM)

Gunadarma University (UG)

Universitas Pendidikan Indonesia (UPI)

Diponegoro University (Undip)

Universitas Sebelas Maret (UNS)

Binus University (ITS)

Universitas Airlangga (Unair)

Bogor University (IPB)

Regions

Sumatra (incl. the Riau Islands and Bangka-Belitung)

Wild and rugged, the 6th largest island in the world has a great natural and cultural wealth with

more than 40 million inhabitants. Habitat to many endangered species.


Kalimantan (Borneo)

The vast majority of this, the world's third largest island, is covered by the Indonesian province.

Uncharted jungles, mighty rivers, home of the orangutan, a paradise for the adventurer.

Java (and Madura)

The country's heartland, big cities including the capital Jakarta, and a lot of people packed on a

not-so-big island. Also features the cultural treasures of Yogyakarta, Borobudur and Prambanan.

Bali

By far the most popular visitor destination in Indonesia, Bali's blend of unique culture, legendary

beaches, spectacular highland regions and unique underwater life make it a perennial favourite

amongst global travellers.

Sulawesi (Celebes)

Strangely shaped, this island houses a diversity of societies and some spectacular scenery, Toraja

culture, rich flora and fauna, world class diving sites.

Nusa Tenggara

Also known as the Lesser Sunda Islands, the "Southeast Islands", contain scores of ethnic

groups, languages and religions, as well as Komodo lizards and more spectacular diving.

Maluku (Moluccas)

The historic Spic Islands, fought over to this day, largely unexplored and almost unknown to the

outside world.

Papua (Irian Jaya)

The western half of the island of New Guinea, with mountains, forests, swamps, an almost

impenetrable wilderness in one of the remotest places on earth.

Cities

Jakarta — the perennially congested capital which is also the largest city of the country

Bandung— university town in the cooler highlands of Java

Banjarmasin— the largest town on Kalimantan with a rich architectural heritage

Manado — Christian city at the northeastern tip of Sulawesi, famous for diving

Medan — the main city of Sumatra

Semarang— the capital of Central Java, with a blend of Javanese, Chinese, and Dutch

influences

Makassar (Ujung Pandang) — the gateway to Sulawesi

Yogyakarta — Java's cultural hub and the access point to the mighty temples of Prambanan

and Borobudur

Jayapura— the capital of Papua and a gateway to the highlands

ECONOMY

http://wikitravel.org/en/Toraja


Indonesia, a vast polyglot nation, has grown

strongly since 2010. During the global financial

crisis, Indonesia outperformed its regional

neighbors and joined China and India as the only

G20 members posting growth. The government

has promoted fiscally conservative policies,

resulting in a debt-to-GDP ratio of less than 25%

and historically low rates of inflation. Fitch and

Moody's upgraded Indonesia's credit rating to

investment grade in December 2011. Indonesia

still struggles with poverty and unemployment,

inadequate infrastructure, corruption, a complex

regulatory environment, and unequal resource

distribution among regions. The government also

faces the challenges of quelling labor unrest and

reducing fuel subsidies in the face of high oil

prices.

Tourism has become an important component of

the Indonesian economy. The achievements made

by the Tourism sector to the national economy

include a 4.01% contribution to national gross

domestic product with 0.69 billion in foreign

exchange revenue, 10.3 million in employment,

while , tourism's current competitiveness in the

world ranked at no. 70 according to the World Economic Forum (WEF).

Economic growth

Long-term leader General Suharto came to power in the wake of an abortive coup in 1965. He

imposed authoritarian rule while allowing technocrats to run the economy with considerable

success.

Indonesia has undergone resurgence since the 1997 Asian financial crisis, becoming one of the

world's major emerging economies.

Investors are attracted by a large consumer base, rich natural resources and political stability, but

often equally deterred by

poor infrastructure, rampant

corruption and growing calls

for economic protectionism.


Traditional markets and modern high rises co-exist in the region's biggest economy

After bottoming out at 5% in 2014, economic growth will

accelerate to an average of 6.1% a year in 2015-19,

supported by infrastructure investment and stronger

export growth.

Government policies to restrain domestic demand and to rein in inflation and the current account

deficit have kept Indonesia’s economy subdued this year. The slowdown is sharper than

anticipated, mainly owing to weakness in exports, particularly commodities, as well as

deceleration in fixed investment and government spending. Growth in gross domestic product

(GDP) at 5.2% in the first half was the slowest since 2009. Private consumption remained robust,

helped by receding inflation, good harvests, and spending related to parliamentary and presidential

elections.


While growth forecasts are trimmed from the Asian Development Outlook (ADO) 2014 in April,

optimism about timely reform by the incoming government and a better outlook for exports next

year suggests that growth will accelerate by 0.5 percentage points in 2015.

Inflation ebbed in the first 8 months as the impact of a hike in administered fuel prices in June

2013 faded and the good harvests kept food price inflation low. For 2014 as a whole, inflation is

now seen averaging 5.8%, slightly above the earlier forecast. The new government is expected to

reduce fuel subsidies in 2015, which should free considerable budget funds for infrastructure and

social development, though it will temporarily push inflation to 6.9%, above the earlier projection.

A larger trade surplus resulted in the first half as imports declined more steeply than exports, but

after taking into account income and trade in services the current account recorded a deficit equal

to 3.1% of GDP. Large inflows of foreign direct and portfolio investment kept the balance of

payments in surplus. International reserves rose, and the rupiah appreciated against the US dollar.

This ADO Update projects that current account deficits will narrow through the forecast period,

but not as much as foreseen in April.

EMPLOYMENT (Employment rate, best industries/companies to work with)

Economy of Indonesia is mainly based on agriculture and oil. Approximately 90% of the

population is engaged in agriculture. In the agricultural sector, Indonesia has become self-

sufficient in rice and does not need to import this staple food as it had for years.

Earlier, oil and gas used to be a major foreign exchange earner but rising domestic consumption

and stagnant oil production has now made Indonesia, a net importer of oil.

Industry: petroleum and natural gas; textiles, apparel, and footwear; mining, cement, chemical

fertilizers.

Agriculture: rice, cassava (tapioca), peanuts, rubber; poultry.


Exports: oil and gas, electrical appliances, plywood, textiles, rubber.

Tourism is steadily gaining ground and is emerging as major foreign exchange earner for the

country. Indonesia is rich in natural resources. Forestry products, rubber, coffee, tea, tin, nickel,

copper, palm products & fish make important contributions to export earnings. In recent years a

number of steps have been taken to promote and stimulate non-oil exports, which include

handicrafts, textiles, precious metals, tea, tobacco, cement, fertilizers as well as manufactured

goods.

The quality and quantity of employment in tourism and the creative economy also experienced an

increase. In 2013, it was recorded that an additional 1,437 tourism graduates were absorbed into

the industry, while in 2014 the number increased to 1,685.

Export earnings from oil and natural gas help the economy, and Indonesia is a member of the

Organization of Petroleum Exporting Countries (OPEC). Tourists come to see the rich diversity of

plants and wildlife—some, like the giant Komodo dragon and the Javan rhinoceros, exist nowhere

else. With the objective of a more equitable distribution of development gains, the government

gives high priority to expansion in the less developed regions of the country and the creation of

employment opportunities for the country's growing labour force. To attract foreign capital, certain

incentives are provided and several sectors are open to foreign investment.

Indonesia's largest company by market capitalization is still HM Sampoerna, the country's

largest tobacco company. The company has been the top company in Indonesia since March 2013

when it replaced Astra International, Indonesia's largest diversified conglomerate, on the top spot.

Astra had been Indonesia's largest company since 2010. Currently, the third-largest company in

terms of market capitalization is Unilever Indonesia. Unilever, which is Indonesia’s largest

consumer goods producer, jumped four places in the ranking since late 2012.

These three top companies of Indonesia are evidence of the country's robust domestic

consumption. Indonesia is characterized by a rapidly expanding middle class and consumptive

behaviour is increasing accordingly. Companies that are able to tap this growing middle class

segment through good corporate management and by having a good distribution network are in a

lucrative position.

Financial institutions, which had been expanding significantly in recent years, have lost some

momentum this year as Indonesia has been hit by financial turmoil after the Federal Reserve

announced to reduce or stop its quantitative easing program. In combination with high inflation

and a current account deficit it has resulted in an outflow of foreign capital, impacting negatively

on Indonesia's currency and stock indices.

Indicator Level Units As-Of 1Y Chg 5Y Ago 10Y Ago

Population 251,490,000 People 2014 1.43% 255 238

Labor Force 121,191,712 People 2013 2.66% 113,833,280 103,973,387

Unemployment Rate 5.50% % 2014 1.79% 5.80% 7.14%

http://www.indonesia-investments.com/news/todays-headlines/indonesias-inflation-1.12-in-august-trade-deficit-at-record-high/item1052

http://www.indonesia-investments.com/news/todays-headlines/indonesias-inflation-1.12-in-august-trade-deficit-at-record-high/item1052


Indicator Level Units As-Of 1Y Chg 5Y Ago 10Y Ago

Youth Unemployment 21.60% % 2012 1.89% 23.50% 26.40%

Age Dependency Ratio 51.77% % 2013 -1.28% 53.70% 53.53%

Participation Rate 69.21% % 2013 1.96% 67.23% 67.55%

Minimum Wage 232 USD per month 2013 74.90% n.a. n.a.

TOURISM

Tourism in Indonesia is an important component of the Indonesian economy as well as a significant

source of its foreign exchange revenues. The vast country of sprawling archipelago has much to

offer; from natural beauty, historical heritage to cultural diversity. In 2012 the tourism sector

contributes to around US$9 billion of foreign exchange, and is estimated will surpassed US$10

billion in 2013. The tourism sector ranked as the 4th largest among goods and services export

sectors.

In year 2013, 8,802,129 international visitors entered Indonesia, staying in hotels for an average

of 7.5 nights and spending an average of US$1,142 per person during their visit, or US$152.22 per

person per day.

The total number of international tourist arrivals to Indonesia in 2014 is at this very

moment recorded at 9.3 million, while domestic tourism totals 251 million trips.

Indonesian Tourism Statistics

Year International visitors Average stay (days)

2000 5,064,217 12.26

2001 5,153,620 10.49

2002 5,033 400 9.79

2003 4,467,021 9.69

2004 5,321,165 9.47

2005 5,002,101 9.05


2006 4,871,351 9.09

2007 5,505,759 9.02

2008 6,429,027 8.58

2009 6,452,259 7.69

2010 7,002,944 8.04

2011 7,649,731 7.84

2012 8,044,462 7.70

2013 8,802,129 7.50

Indonesia Tourist Arrivals 2014-2015

Tourist Arrivals in Indonesia decreased to 723039 in January of 2015 from 915334 in December

of 2014. Tourist Arrivals in Indonesia averaged 707239.73 from 2011 until 2015, reaching an all

time high of 915334 in December of 2014 and a record low of 548821 in January of 2011.

Tourist Arrivals in Indonesia is reported by the Statistics Indonesia.

But the achievements made by the Tourism sector to the national economy include a 4.01%

contribution to national gross domestic product with 0.69 billion in foreign exchange revenue, 10.3


million in employment, while , tourism's current competitiveness in the world ranked at

no. 70 according to the World Economic Forum (WEF).

These achievements made by tourism in 2014 have become the foundation to set the target for

2019 which should double in value. In the macroeconomic forecast, Tourim target for 2019 should

be an 8% contribution to GNP, US$20 billion in foreign currency revenue, 13 million

employment, through 20 million international tourist arrivals, 275 domestic tourist trips ,

thus ranking at no 30 in tourism competitiveness worldwide.

The Minister of Tourism also announced a number of top tourism events in Indonesia for 2015

which include: the Jakarta Fashion and Food Festival, Java Jazz Festival, Jakarta

Marathon, Batam Six Bridges, ASEAN Jazz Festival, Bintan Triathlon, 60 Years Asian-

African Conference Festival in Bandung, Tour de Singkarak, Singkawang Festival, Baliem

Valley Festival, and Amway China Incentive Event in Bali.

As in previous years, Indonesian waters will also be highlighted with international sailing events.

A number of important sailing events for 2015 are: the Singapore Strait Regatta, Neptune

Regatta, Sail Indonesia, Darwin-Ambon Yacht Race, Darwin-Saumlaki, Wonderful Sail 2

Indonesia and Sail Maluku.

Singapore, Malaysia, China, Australia, and Japan are the top five source of visitors to Indonesia.

Tourist Attractions

1. Bali is one of the world’s most popular island destinations and one which consistently wins

travel awards. The varied landscape, rugged coastlines, tropical beaches, lush rice terraces

and volcanic hillsides all provide a picturesque backdrop to its colorful, deeply spiritual

and unique Hindu culture. The combination of friendly people, a magnificently visual

culture infused with spirituality and spectacular beaches with great surfing and diving have

made Bali the unrivaled number one tourist attraction in Indonesia.

2. Located 40 km (25 miles) northwest of Yogyakarta on Java, the Borobudur is the one of

the most famous Buddhist temple in the world. The Borobudur was built over a period of

some 75 years in the 8th and 9th centuries by the kingdom of Sailendra, out of an estimated

2 million blocks of stone. It was abandoned in the 14th century for reasons that still remain

a mystery and for centuries lay hidden in the jungle under layers of volcanic ash. Today it

is one of the most popular tourist attractions in Indonesia.

3. The Komodo National Park is a national park located within the Lesser Sunda Islands

that includes the three larger islands Komodo, Padar and Rincah, and 26 smaller ones. The

park is named after the Komodo Dragon, the world’s largest living reptile that can reach 3

meters or more in length and weigh over 70kg. Although Komodo dragons eat mostly

carcass of dead animals, they are formidable predators and will also hunt prey including

birds, and mammals. Attacks against humans are very rare.


4. Lombok’s most popular tourist destination, the Gili Islands are an archipelago of three

small islands: Gili Trawangan, Gili Meno and Gili Air. The islands are very relaxed and

laid-back, with countless little beachside cafes still playing reggae and no cars or

motorbikes to disturb the peace. Note that the name “Gili Islands” is rather redundant as

gili simply means “small island” in Sasak and there are many other islands around the coast

of Lombok with Gili in their names.

5. Torajaland (Tana Toraja) is a highland region of South Sulawesi, home of the Toraja

people. Torajans are famous for their massive peaked-roof houses known as tongkonan and

spectacular but gruesome funeral rites. After a person’s death, the body is kept – often for

several years – until the actual funeral ceremony which can last for several days. The

deceased is then finally buried in a small cave or in a hollow tree.

6. Located at the north of the island of Sulawesi, Bunaken is one of Indonesia’s most famous

dive and snorkeling areas. The island is part of the Bunaken Marine Park where you can

see more than 70% of all fish species that live in the western Pacific ocean. The best time

for diving in Bunaken is between the months of April and November.

7. Gunung Bromo is an active volcano and part of the Tengger massif, in East Java. At 2,329

meters (7,641 feet) it is not the highest peak of the massif, but it is the most well known.

The area is one of the most visited tourist attractions in Indonesia and Java. The top of the

volcano has been blown off and the crater inside constantly belches white smoke. It is

surrounded by the Sea of Sand of fine volcanic sand. The overall effect is unsettlingly

unearthly.

8. The Baliem Valley in the highlands of Western New Guinea offers a glimpse into what

was recently a stone-age world. The valley was not known to the outside world until 1938

when an aerial reconnaissance flight southwards from Hollandia (now Jayapura)

discovered a large agricultural population. Wamena is the starting point for most visitors

who come nowadays to marvel at the mountain views, roaring rivers, tribal villages and at

the tough but sweet spirit of the warm Dani people.

9. The Tanjung Puting National Park is located on the island of Borneo in the Indonesian

province of Central Kalimantan. The park is a popular ecotourism destination, with many

local tour companies offering multi-day boat tours to view wildlife and visit the research

centers. Wildlife include gibbons, macaques, clouded leopards, sun bears, pythons,

crocodiles and – most famously – orangutans. Unfortunately the park is heavily threatened

by illegal logging and forest clearing for agricultural uses.


10. Lake Toba on the island of Sumatra is an immense volcanic lake about 100 kilometers

long and 30 kilometers wide. Formed by a gigantic volcanic eruption some 70,000 years

ago, it is the largest resurgent caldera on Earth. Genetic estimates suggests that there were

only a few thousand humans that survived the catastrophe. The island in the middle – Pulau

Samosir – is the largest island within an island and contains two lakes. Besides visiting “a

lake on an island within a lake on an island” tourist also come here to kick back and relax

and swim in the volcanically warmed waters.

REFERENCES

http://www.indonesia.travel/

http://en.wikipedia.org/wiki/Indonesia

http://www.lonelyplanet.com/indonesia

http://wikitravel.org/en/Indonesia

http://www.infoplease.com/

http://www.bbc.com/

http://country.eiu.com/indonesia

http://www.adb.org/countries/indonesia/economy

http://www.tradexpoindonesia.com/indonesia-facts

https://www.cia.gov/library/publications/the-world-factbook/geos/id.html

http://www.indonesia-investments.com/finance/financial-columns/top-ten-largest-companies-in-

indonesia-by-market-capitalization/item1084

https://www.quandl.com/c/indonesia/indonesia-labour-employment

http://www.indonesia.travel/

http://en.wikipedia.org/wiki/Indonesia

http://www.lonelyplanet.com/indonesia

http://wikitravel.org/en/Indonesia

http://www.infoplease.com/

http://www.bbc.com/

http://country.eiu.com/indonesia

http://www.adb.org/countries/indonesia/economy

http://www.tradexpoindonesia.com/indonesia-facts

https://www.cia.gov/library/publications/the-world-factbook/geos/id.html

http://www.indonesia-investments.com/finance/financial-columns/top-ten-largest-companies-in-indonesia-by-market-capitalization/item1084

http://www.indonesia-investments.com/finance/financial-columns/top-ten-largest-companies-in-indonesia-by-market-capitalization/item1084

https://www.quandl.com/c/indonesia/indonesia-labour-employment

indonesia - icsiindia.in · 2010, with the majority being sunni (99%). the shias and ahmadis...

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