indonesia...cited sluggish global economic growth, low commodity prices, and lower-than-expected gdp...
TRANSCRIPT
Indonesia
Executive Summary
Economy The rise of Southeast Asia’s largest economy in recent decades has been nothing short of spectacular. While the
Indonesian economy was severely impacted by the Asian financial crisis in the late 1990s, the economy has
rebounded strongly since, with the country today considered to be a newly industrialised country (NIC). From an
average economic growth of 4.6% per annum (p.a.) over the period 2000-2004, growth surged to an average of
6% p.a. over the period 2005-2011, underpinned by a strong recovery in global commodity prices. While somewhat
slower in recent years due mainly to economic headwinds and challenges emanating from global exogenous
economic conditions, growth has remained strong overall, at a still-robust 5.02% in 2014 and 4.79% in 2015.
Forecasts remain buoyant for 2016, with the International Monetary Fund (IMF) projecting economic growth at
4.94% in 2016; while the Asian development Bank (ADB) sees this at 5% in 2016. The economy is poised to grow
at a healthy pace going forward, with economic growth forecasts ranging from 5.5% - 5.7% in 2017. Beyond this,
growth in Southeast Asia’s largest economy is expected to remain robust over the medium to long-term, with
Business Monitor International (BMI) forecasting real GDP growth to average 6.1% over the next decade, driven
largely by domestic demand.
Trade
China was the leading import market into Indonesia in 2015, valued at USD29bn. Singapore and Japan were
ranked second and third valued at USD18bn and USD13bn respectively. South Africa exported goods to the value
of ZAR2.8bn in 2015 while imported goods were valued at ZAR8.9bn. South Africa has maintained a trade deficit
with Indonesia, with imports exceeding exports over the period 2006 to 2016. The leading export product to
Indonesia from South Africa in 2015, was chemical wood pulp, dissolving grades valued at ZAR1.4bn, followed by
iron ores (ZAR309m).
The Western Cape exported goods to the value of ZAR143m in 2015 while imported goods were valued at
ZAR1.1bn. The leading export product to Indonesia from the Western Cape was fresh apples, pears and quinces
valued at ZAR45m, followed by machinery for the industrial preparation or manufacture of food or drink (ZAR27m).
The fastest growing export products were grapes (62%), citrus fruit (56%) and insecticides, rodenticides, fungicides
(40%). Indonesia has an appetite for Western Cape’s agriculture, forestry and fishing sector (accounting for 41%),
followed by metals, metal products, machinery and equipment (26%) and petroleum products, chemicals, rubber
and plastic (12%).
Investment
Between January 2003 and December 2015 a total of 126 FDI projects were recorded from Indonesia. These
projects represent a total capital investment of ZAR204.44bn. Financial services and coal, oil and natural gas both
received the largest FDI from Indonesia by projects accounting for 13% and 8% respectively.
Between 2003 and 2015 there were 3 FDI projects from South Africa’s to Indonesia valued at ZAR178m, creating
a total of 56 jobs.
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Table of Contents
1. General Information ................................................................................................................... 3
2. Economic Overview ................................................................................................................... 3
2.1 Doing Business in Indonesia .............................................................................................. 6
2.2 Indonesia’s Sovereign Credit Ratings ............................................................................... 7
3. Trade .............................................................................................................................................. 9
3.1 Indonesia Trade in Services ............................................................................................... 9
3.2 Indonesia Global Trade ..................................................................................................... 10
3.3 Trade with South Africa ..................................................................................................... 12
3.4 Western Cape Trade with Indonesia ............................................................................... 14
3.5 Tariffs ................................................................................................................................... 15
3.6 Trade Regulations Markings and Standards .................................................................. 16
4. Investment ................................................................................................................................. 18
4.1 Global Investment into Indonesia .................................................................................... 18
4.2 Global Investment from Indonesia ................................................................................... 21
4.3 Investment Relations between South Africa and Indonesia ........................................ 24
5. Tourism ....................................................................................................................................... 25
5.1 Indonesia Trends and Travel Patterns ............................................................................ 25
5.2 Indonesia Tourist Arrivals into South Africa ................................................................... 25
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1. General Information
Indonesia, a nation situated in Southeast Asia is an archipelago made up of volcanic islands spread between Asia
and Australia. It is comprised of more than 17,500 islands, of which 6,000 are inhabited, and is the world’s largest
country comprised solely of islands. It is highly diverse ethnically, with more than 700 languages spoken. The
archipelago has international land boundaries with three sovereign states, namely Timor-Leste (253 km), Malaysia
(1,881 km), and Papua New Guinea (824 km), and has a coastline of 54,716 km. With an area of approximately
1.9 million km² - of which 1.8 million km² is comprised of land, with the balance of 93 thousand km² being water -
Indonesia is the15th largest country in world by land area. It is divided into 31 provinces; one autonomous province
(Aceh), one special region (Yogyakarta) and one national capital district (Jakarta Raya).
Indonesia is the fourth most populous state in the world, with the population estimated at 258, 316,051 in July 2016.
The country is ruled by a Government coalition. The last legislative and presidential elections took place in 2014
and are next scheduled to take place concurrently in 2019. Indonesia is a member of numerous formal and informal
multilateral organisations, including the Association of Southeast Asian Nations (ASEAN), the Non-Aligned
Movement, the Organisation of Islamic Cooperation, Asia-Pacific Economic Cooperation (APEC), the G-20 major
economies, and the Consultative Group on Indonesia (CGI).
GENERAL INFORMATION
Capital City Jakarta
Government Type Presidential Republic
Chief of State President Joko Widodo
Head of
Government President Joko Widodo
Population 258,316,051 (July 2016 estimate)
Life Expectancy 72.7 years
Literacy 93.9% (2015 estimate)
Ethnic Groups
Javanese (40.1%), Sundanese (15.5%), Malay (3.7%), Batak
(3.6%), Madurese (3%), Betawi (2.9%), Minangkabau (2.7%),
Buginese (2.7%), Bantanese (25), Banjarese (1.7%), Balinese
(1.7%), Achnese (1.4%), Dayak (1.4%), Sasak (1.3%), Chinese
(1.2%), and other (15%)
Religions Muslim (87.2%), Christian (7%), Roman Catholic (2.9%), Hindu
(1.7%), and other (0.9%) (Includes Buddhist and Confucian).
Languages
Bahasa Indonesia (official, modified form of Malay), English,
Dutch, local dialects of which the most widely spoken in
Javanese. (More than 700 languages are used in Indonesia).
HDI Value (2015
Report) 0.727 (Ranked 110/188)
Sources: CIA World Factbook, 2016; World Bank Data, 2016; United Nations Data 2016
2. Economic Overview
The rise of the Indonesian economy has been nothing short of spectacular. With the economy growing at an
average annual rate of 7% over the period 1965 – 1997, this enabled Indonesia to graduate from the rank of the
low-income-countries into the rank of the lower-middle-income countries (MICs), which the World Bank defines as
has having a per capita income of between $1,025 and $4,036. According to the International Monetary Fund’s
(IMF) latest World Economic Outlook (WEO) published on 04 October 2016, Indonesia’s gross domestic per capita
income was $3,362.36 in 2015. Further, with a gross domestic product (GDP) of $2.848trn (PPP), Indonesia was
the ninth largest country in the world by this measure in 2015.
While the economy was severely impacted by the Asian financial crisis in the late 1990s, which saw GDP falling
by 13.6% in 1998, and real economic growth recovering to just 0.3% in 1999, the economy has rebounded strongly
since, with the country considered today to be a newly industrialised country (NIC). From an average of 4.6% per
annum (p.a.) over the period 2000-2004, economic growth surged to an average of 6% p.a. over the period 2005-
2011, underpinned by a strong recovery in global commodity prices. While somewhat slower in recent years due
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mainly to economic headwinds and challenges emanating from global exogenous economic conditions, economic
growth has remained strong overall, at a still-robust 5.02% in 2014 and 4.79% in 2015.
Source: IMF, 2016
Most recently, the Indonesian economy expanded by 5.18% y-o-y in the second quarter of 2016 (2016 Q2),
compared to a downwardly revised 4.92% y-o-y growth rate in 2016 Q1. This was the strongest growth rate
recorded since 2013 Q4, and was driven by an increase in private consumption and government spending.
Jakarta has announced a number of policy reforms since September 2015, with some sectors – including trade
and investment policy – witnessing a shift towards deregulation, which in turn is aimed at improving the country’s
investment climate. Together with prudent monetary policy and increased public investment in infrastructure, these
are helping buoy economic growth, which the World Bank projects at 5.1% in 2016. In turn, on 22 May 2016 the
Bank of Indonesia (the central bank) revised its projection for Indonesia’s economic growth in 2015 downward to
the range of 5.0% – 5.4% (y-o-y), slightly lower than its previous forecast of 5.2% - 5.4% y-o-y. The central bank
cited sluggish global economic growth, low commodity prices, and lower-than-expected GDP growth in 2016 Q1
for the downward revision. Still, forecasts remain buoyant overall and within a relatively narrow range, with the IMF
projecting economic growth at 4.94% in 2016; while the Asian development Bank (ADB) sees this at 5% in 2016.
Looking ahead, the economy is poised to grow at a healthy pace, with economic growth forecasts ranging from
5.5% - 5.7% in 2017. Beyond this, growth in Southeast Asia’s largest economy is expected to remain robust over
the medium to long-term, with Business Monitor International (BMI) forecasting real GDP growth to average 6.1%
over the next decade, driven largely by domestic demand. The global research house cautions however that
unlocking Indonesia’s full economic potential will require policy reform success – particularly in the areas of
bureaucratic efficiency, corruption and investment promotion – and that progress on this front could take place at
a slow-to-moderate pace.
ECONOMIC INFORMATION
GDP (PPP) (2015 est.) USD2.848trn
GDP growth (2015 est.) 4.79%
GDP per capita (PPP) (2015 est.) U$D11,148.54
Inflation (Avg. 2015) 5.9%
Inflation (y-o-y; September 2016) 3.07%
BI Rate (13 October 2016) 5%
Unemployment rate (May 2016) 5.5%
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ECONOMIC INFORMATION
Doing Business, 2016 Report (ranking out of 180) 109
Total Exports (2015) USD150.28bn
Total Imports (2015) USD142.69bn
Sources: CIA World Factbook; Doing Business Report 2016; World Bank International Labour Organisation, 2016
Economic Structure
In line with many of the so-called Asian Tigers – a term given to a number of economies in Asia which have
undergone rapid economic growth and which has usually been accompanied by an increase in the standard of
living – who, as their leadership embarked on processes of industrialisation and urbanisation have seen the
structure of their economies change dramatically, so has this been the case in Indonesia.
The gradual process of industrialisation and urbanisation, which began in the late 1960s and accelerated in the
1980s as falling oil prices saw the Indonesian government focus on diversifying from oil exports towards
manufactured exports, was a case in point. To this end, from 1967 to 2009, the manufacturing share of GDP
increased by 19 percentage points, while the agricultural share fell by 35 percentage points. Similarly, the share of
the population living in the urban areas increased from 17% to 53% over this period. Despite industrialising over
the past 50 years, agriculture remains an important part of the Indonesian economy.
The journey of economic modernisation has understandably led to a significant change in the structure of the
economy, with the manufacturing/industrial sector today the key driver of economic output. To this end, according
to the country’s official statistics office, Statistics Indonesia, the said sector accounted for 45% of economic output
in 2014, some 32 basis points higher than the 13% contributed in 1965. The services sector followed closely, with
a contribution of 41% to the country’s gross domestic product in 2014. Of interest is that the contributions made by
these two sectors to economic output over the past two decades has remained relatively stable, fluctuating in a
narrow band of between 41 and 47% of GDP over the period 1996 – 2014.
INDONESIA’S ECONOMIC STRUCTURE:SECTORAL CONTRIBUTION (%) 1965 vs. 1980 vs. 2010 vs. 2014
1965 1980 1996 2010 2014
Agriculture 51 24 16 15 14
Industry 13 42 43 47 45
Services 36 34 41 38 41
Sources: Statistics Indonesia, World Bank, CIA World Factbook
The most notable change lies in the contribution made by the agricultural sector. From 51% in 1965, in 2014 the
said sector contributed 14% towards economic output; a far cry from levels seen in the late 1960s. This stands to
reason given the changes seen in the country over the past thirty years and is directly ascribed to the transformation
of the economy from its largely agrarian dependence to the modern economy it is today.
In terms of the current structure of the economy (2014, the most recent official data available), as indicated in the
graph below the manufacturing industry, with its contribution of 24% towards GDP, accounted for the largest share
of economic output in 2014. The trade, hotels & restaurants category followed with a contribution of 15% of GDP,
while the agriculture, livestock, forestry & fishing placed third at 14%.
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Source: Statistics Indonesia, 2016
As the Indonesian economic landscape has transformed and grown into a modern day economy, so has the
presence and stature of a number of Indonesian companies on the global economic stage. Testimony to this is the
presence of a number of Indonesian companies on the Forbes 2000 List, a comprehensive annual ranking of the
world’s largest public listed companies.
TOP INDONESIAN COMPANIES ON FORBES 2000 LIST, 2016
GLOBAL RANK
COMPANY SECTOR SALES
(USDbn)
MARKET CAPITAL (MAY 2016)
(USDbn)
429 Bank Rakyat Indonesia Regional Banks 7.13 20.4
462 Bank Mandiri Regional Banks 7.51 17.6
620 Bank Central Asia Regional Banks 4.41 24.5
659 Telekom-Indonesia Telecommunications 7.84 27.4
1,063 Bank Negara Indonesia Regional Banks 3.63 6.9
1.387 Gudang Garam Tobacco 5.25 9.8
1,542 PGN Natural Gas Utilities 3.4 9.1
1,620 Semen Indonesia Construction Materials 2.35 8.7
1,898 Bank Danamon Indonesia Regional Banks 2.53 3.8
Source: Forbes 2000, 2016
2.1 Doing Business in Indonesia
The World Bank Group in its annual Doing Business 2016 report ranked Indonesia 109th out of 189 countries
monitored in terms of ease of doing business.
Indonesia’s relative strengths in terms of ease of doing business include getting electricity, with the country ranking
46th globally in this category, getting credit (70th), resolving insolvency (77th), and protecting minority investors
(88th).
Conversely, according to the report, the country fared less favourably in terms of starting a business with a ranking
of 173rd, enforcing contracts (170th), paying taxes (148th), and registering a property (131st). Indicators ranked by
the report are tabled below:
Agriculture, Livestock,
Forestry and Fishery
14% Mining and Quarrying
11%
Manufacturing Industry
24%Construction10%
Trade, Hotel & Restaurants
15%
Transport and Communication
7%
Finance, Real Estate and
Business Services8%
General Government
Services6%
Private Services5%
Indonesia GDP Sectoral Contribution, 2014
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INDONESIA’S RANKINGS - DOING BUSINESS, 2016 REPORT
INDICATORS 2016 RANKING
(OUT OF 189 COUNTRIES)\
Starting a Business 173
Dealing with Construction Permits 107
Getting Electricity 46
Registering Property 131
Getting Credit 70
Protecting Investors 88
Paying Taxes 148
Trading Across Borders 105
Enforcing Contracts 170
Resolving Insolvency 77
Doing Business 2016 109
Source: World Bank Group’s Doing Business, 2016 Report
2.2 Indonesia’s Sovereign Credit Ratings
“A sovereign credit rating is the credit rating of a country or sovereign entity. Sovereign credit ratings give investors
insight into the level of risk associated with investing in a particular country and also include political risks. At the
request of the country, a credit rating agency will evaluate the country’s economic and political environment to
determine a representative credit rating”.
Source: Investopedia
While a number of credit agencies exist, the three most recognised credit ratings agencies globally are Fitch
Ratings, Moody’s Investors Services and Standard & Poor’s (S&P). Reasons for a country/sovereign to seek a
credit rating from one of the these three agencies include not only to access funding in international bond markets
via the issuance of bonds in external debt markets, but it is a means to attract foreign direct investment. Obtaining
a good sovereign credit rating instils confidence in investors seeking to invest in that country, with the credit rating
a means for the country to demonstrate financial transparency and credit standing.
Two key rating ‘standards’ exist, with the highest possible rating category being “AAA” according to S&P, which
indicates that the rated country has extremely strong capacity to meet its financial commitments. A wide range of
rating categories exists below this, with the categories ranging all the way down to SD (i.e. defaulted), which means
the rated country has failed to pay one or more of its financial obligations when it came due.
While Indonesia has long been rated by the three main said credit agencies, only two of three agencies have
awarded the country investment grade status. To this end, Fitch Ratings and Moody’s Investors Services promoted
Indonesia’s credit rating to investment grade in 2011 and 2012, respectively. Standard & Poor’s (S&P) however
have been more cautious in their assessment, and have maintained the rating at BB+ with a positive outlook – one
notch below investment grade status; or said differently, the highest junk level rating, for a number of years.
Most recently, on 28 January 2016, Moody’s Investors Services affirmed the Government of Indonesia’s Baa3
sovereign credit rating, with a stable outlook. (Baa3 is the lowest notch within the investment grade category on
this rating scale). Fitch Ratings followed shortly thereafter, affirming the country’s sovereign credit rating at BBB-
with a stable outlook on 24 May 2016. (As with Moody’s, BBB- is the lowest notch within the investment grade
category on this particular rating scale).
Contrary to expectations, on 01 June 2016, S&P maintained Indonesia’s sovereign debt rating at BB+ with a
positive outlook. (BB+ is one notch below investment grade rating and is the highest rating in the junk rating
categories). In June 2015, S&P raised the outlook to positive, which raised expectations that the country could
possible in line for a rating upgrade to investment grade i.e. BBB- at its next annual review. While S&P left the door
open for a future rating upgrade at its June 2016 assessment as seen by the positive outlook, the agency noted
that the government will need to enhance its fiscal performance as well as improve the quality of the country’s
corporate credit, amongst other requirements.
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INDONESIA’S SOVEREIGN CREDIT RATINGS, 2016
CREDIT RATING AGENCY
STANDARD & POORS MOODY’S INVESTOR
SERVICES FITCH RATINGS
CREDIT RATING BB+ Baa3 BBB-
OUTLOOK Positive Stable Stable
DATE OF LAST CHANGE
01 June 2016 28 January 2016 24 May 2016
Sources: Standard & Poor’s; Moody’s Investors Services; & Fitch Ratings
A number of alternative measures and rating scales exist to assess risks posed to companies and banks,
particularly those pertaining to political and commercial risks when undertaking international commercial
transactions. One such company which offers these services is Belgium’s Delcredereducroire, the country’s official
export credit agency and public credit insurer.
The table below shows Delcredereducroire’s current risk assessment of China in terms of export transactions and
direct investments. Ratings are between 1 and 7, and between A and C, with 7 and C being the maximum risk
indicators.
In terms of political risk associated with exports transactions in China, these are deemed to be low both
in the short- and long-term.
Commercial risk in turn is considered to be mid-way between low and high levels of risk.
Regarding direct investment, with the exception of risk associated with expropriation and government
action, all other categories are considered to be relatively low as indicated by scores awarded below.
INDONESIA’S RISK ASSESSMENT - DELCREDEREDUCROIRE
EXPORT TRANSACTIONS (Scale 1 – 7)*
Political Risks
Short Term 3
Medium-Long term 3
Special Transactions 3
Commercial Risk B **
DIRECT INVESTMENTS
War risk 3
Risk of expropriation and government action 5
Transfer risk 3
* Where 1 is associated with the least risk and 7 the most.
** Where B is associated with mid risk; A is low risk and C is high risk.
Source: ONDD, 2016
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3. Trade
3.1 Indonesia Trade in Services Indonesia exports in services grew by 6% in 2015 to reach USD22bn. Over the period analysed Indonesia has
consistently maintained a negative trade balance with imports outperforming export services over the period
analysed.
Source: TradeMap, 2016
The table below shows Indonesia’s trade in services for 2015. Travel (defined as covering goods and services for
own use or to be given away, acquired from an economy, by non-residents during visits to that economy) was the
largest services export valued at USD10n followed by Other business services (includes merchant activity and
other trade-related services, operational leasing (rental), miscellaneous business, professional, and technical
services and other services) valued at USD5bn.
Transport was the largest import service into Indonesia’s valued at USD9.6bn followed by other business services
valued at USD7.5bn.
SERVICES EXPORTED BY INDONESIA, 2015 SERVICES IMPORTED BY INDONESIA, 2015
CODE SERVICE VALUE
2015 (USDm)
% GROWTH 2010-2015
CODE SERVICE VALUE
2015 (USDm)
% GROWTH 2010-2015
4 Travel 10 654.4 8.99% 3 Transport 9 600.6 3.79%
10 Other business services 4 806.5 4.87% 10 Other business services 7 462.2 7.11%
3 Transport 3 469.4 6.25% 4 Travel 7 299.2 2.91%
9 Telecommunications, computer, and information services
1 022.6 -1.71% 9 Telecommunications, computer, and information services
1 736.9 9.69%
12 Government goods and services n.i.e. 631.8 2.63% 8 Charges for the use of intellectual property n.i.e.
1 570.3 -0.14%
5 Construction 374.5 -0.53% 6 Insurance and pension services 942.1 -3.57%
1 Manufacturing services on physical inputs owned by others
355.6 - 7 Financial services 734.6 5.26%
7 Financial services 261.1 -3.23% 5 Construction 451.1 -1.66%
2 Maintenance and repair services n.i.e. 119.1 15.47% 2 Maintenance and repair services n.i.e.
358.8 29.43%
11 Personal, cultural, and recreational services
115.2 6.12% 12 Government goods and services n.i.e.
161.8 -13.41%
8 Charges for the use of intellectual property n.i.e.
54.3 0.25% 11 Personal, cultural, and recreational services
66.6 1.21%
6 Insurance and pension services 26.5 3.62% - - - -
TOTAL EXPORTS 21 890.9 6.06% TOTAL IMPORTS 30 384.2 3.29%
Source: TradeMap, 2016
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Exports (USDbn) 11.6 12.6 15.4 13.2 16.9 21.9 23.7 22.9 23.5 21.9
Imports (USDbn) 21.6 24.6 28.5 23.2 26.5 31.7 34.2 35.0 33.5 30.4
Trade balance (USDbn) - 10.0 - 12.0 - 13.1 - 9.9 - 9.6 - 9.8 - 10.6 - 12.1 - 10.0 - 8.5
-20
-10
0
10
20
30
40
Valu
e (
US
Db
n)
INDONESIA TRADE OF SERVICES, 2006-2015
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3.2 Indonesia Global Trade
Exports for Indonesia in 2015 were valued at USD150bn while global imports from Indonesia were valued at
USD143bn in 2015. Except for 2012 to 2014, Indonesia’s trade balance over the period has been consistently
positive.
Source: TradeMap, 2016
Japan was the leading export market for Indonesia with a value of USD18bn. The United States and China rank
second and third valued at USD16bn and USD15bn respectively.
Source: TradeMap, 2016
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Exports (USDbn) 100.8 114.1 137.0 116.5 157.8 203.5 190.0 182.6 176.0 150.3
Imports (USDbn) 61.1 74.5 129.2 96.8 135.7 177.4 191.7 186.6 178.2 142.7
Trade balance (USDbn) 39.7 39.6 7.8 19.7 22.1 26.1 - 1.7 - 4.1 - 2.1 7.6
-50
0
50
100
150
200
250
Valu
e (
US
Db
n)
INDONESIA GLOBAL TRADE, 2015
TOP 10 DESTINATION COUNTRIES FOR INDONESIA'S EXPORTS, 2015
RANK COUNTRY VALUE
2015 (USDbn)
% GROWTH 2014-2015
1 Japan 18.0 -22.11%
2 United States 16.3 -1.77%
3 China 15.0 -14.54%
4 Singapore 12.6 -24.59%
5 India 11.7 -4.38%
6 Korea, Republic of 7.6 -27.88%
7 Malaysia 7.6 -21.63%
8 Thailand 5.5 -4.80%
9 Taipei, Chinese 5.0 -21.60%
10 Philippines 3.9 0.86%
32 South Africa 0.7 -51.71%
TOTAL EXPORTS 150.3 -14.63%
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China was the leading import market in 2015, valued at USD29bn. Singapore and Japan were ranked second and
third valued at USD18bn and USD13bn respectively.
TOP 10 SOURCE MARKETS FOR INDONESIA'S IMPORTS, 2015
RANK COUNTRY VALUE
2015 (USDbn)
% GROWTH 2014-2015
1 China 29.4 -3.96%
2 Singapore 18.0 -28.44%
3 Japan 13.3 -22.01%
4 Malaysia 8.5 -21.42%
5 Korea, Republic of 8.4 -28.87%
6 Thailand 8.1 -17.36%
7 United States of America 7.6 -7.01%
8 Australia 4.8 -14.73%
9 Germany 3.5 -15.14%
10 Saudi Arabia 3.4 -47.49%
41 South Africa 0.2 -53.47%
TOTAL EXPORTS 142.7 -19.92%
Source: TradeMap, 2016
Palm oil and its fractions was the leading export product from Indonesia valued at USD15bn. Coal; briquettes,
ovoids and petroleum gases ranked second and third valued at USD15bn and USD10bn respectively. The fastest
growing export products between 2011 and 2015 were copper ores (95%) and articles of jewellery and parts thereof
(56%).
Refined petroleum oils were also the leading imported product in Indonesia, valued at USD14bn, followed by crude
oils and telephone sets were ranked second and third at USD8bn and USD4bn respectively.
TOP 10 PRODUCTS EXPORTED BY INDONESIA 2015 TOP 10 PRODUCTS IMPORTED BY INDONESIA, 2015
RANK PRODUCT VALUE
2015 (USDbn)
% GROWTH 2011-2015
RANK PRODUCT VALUE
2015 (USDbn)
% GROWTH 2011-2015
1 Palm oil and its fractions 15.4 -11.91% 1 Refined petroleum oils and oils obtained from bituminous
14.0 -47.57%
2 Coal; briquettes, ovoids 14.7 -21.58% 2 Crude petroleum oils and oils obtained from bituminous minerals
8.1 -38.32%
3 Petroleum gas and other gaseous hydrocarbons
10.3 -39.81% 3 Telephone sets, incl. telephones for cellular networks
4.3 -11.12%
4 Crude petroleum oils and oils 6.5 -30.35% 4 Parts for tractors, motor vehicles for the transport of persons
2.5 -15.53%
5 Natural rubber, balata, gutta-percha, guayule, chicle
3.7 -21.99% 5 Wheat and meslin 2.1 -12.75%
6 Articles of jewellery and parts thereof 3.3 55.46% 6 Petroleum gas and other gaseous hydrocarbons
2.0 -33.46%
7 Copper ores and concentrates 3.3 94.65% 7 Automatic data-processing machines
1.9 -9.29%
8 Motor cars and other motor vehicles for persons
2.4 -8.04% 8 Oilcake and other solid residues 1.8 -17.35%
9 Coconut "copra", palm kernel or babassu oil
2.4 -4.27% 9 Semi-finished products of iron or non-alloy steel
1.5 -21.82%
10 Plywood, veneered panel and similar laminated wood
2.3 -1.29% 10 Electronic integrated circuits; parts thereof
1.5 -7.58%
TOTAL EXPORTS 150.3 -14.63% TOTAL IMPORTS 142.7 -19.92%
Source: TradeMap, 2016
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Indonesia's imports represent 0.9% of world imports and
is the world 30th largest importer.
Indonesia's exports represent 0.9% of world exports and is the
world’s 29th largest exporter.
Source: TradeMap, 2016
3.3 Trade with South Africa
Trade between South Africa and Indonesia has significantly increased from 2004 to 2015. South Africa exported
goods to the value of ZAR2.8bn in 2015 while imported goods were valued at ZAR8.9bn. South Africa has
maintained a trade deficit with Indonesia, with imports exceeding exports over the period 2006 to 2016.
Source: Quantec, 2016
The leading export product to Indonesia from South Africa in 2015, was chemical wood pulp, dissolving grades
valued at ZAR1.4bn, followed by iron ores (ZAR309m). The leading import product into South Africa from Indonesia
was palm oil and its fractions valued at ZAR2.2bn, followed by motor cars (ZAR699m).
Indonesia has an appetite for South Africa’s wood, paper, publishing and printing sector accounting for 58% of
exports, followed by mining and quarrying (13%) and metals, metal products, machinery and equipment (12%).
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Exports (ZARm) 1 473 1 489 2 451 3 254 3 906 5 348 4 887 4 855 3 983 2 765
Imports (ZARm) 3 004 4 472 5 461 5 872 4 905 6 959 7 511 8 412 9 185 8 915
Trade balance (ZARm) -1 531 -2 983 -3 010 -2 618 -999 -1 611 -2 623 -3 557 -5 201 -6 150
-8 000
-6 000
-4 000
-2 000
0
2 000
4 000
6 000
8 000
10 000
Valu
e (
ZA
Rm
)
SOUTH AFRICA TRADE WITH INDONESIA, 2006-2015
Largest exporter of
Tin and articles thereof
5th largest importer of
cotton
Largest exporter
Animal or vegetable fats
and oils
5th largest importer of Sugars and
sugar confectionery
Largest importer of Vegetable plaiting materials
2nd largest exporter of Vegetable
plaiting materials
13
SOUTH AFRICA’S EXPORTS TO INDONESIA, 2015 SOUTH AFRICA’S IMPORTS FROM INDONESIA, 2015
RANK PRODUCT VALUE
2015 (ZARm)
% GROWTH 2011-2015
(USD)
RANK PRODUCT VALUE
2015 (ZARm)
% GROWTH 2011-2015
(USD)
1 Chemical wood pulp, dissolving grades 1 442.3 -11.14% 1 Palm oil and its fractions 2 193.0 7.79%
2 Iron ores and concentrates, including roasted iron pyrites.
309.3 -1.35% 2 Motor cars and other motor vehicles for the transport of persons
699.4 3.12%
3 Chemical wood pulp, soda or sulphate, other than dissolving grades
159.3 -0.96% 3 Natural rubber, balata, gutta-percha, guayule, chicle
436.4 -14.04%
4 Unwrought aluminium 112.5 16.85% 4 Motor vehicles for the transport of goods.
328.6 -2.42%
5 Ferrous waste and scrap; remelting scrap ingots of iron or steel
83.0 11.05% 5 Coconut (copra), palm kernel or babassu oil
291.2 24.66%
6 Apples, pears and quinces, fresh. 49.2 5.93% 6 Ceramic wares for laboratory, chemical or other technical uses; ceramic troughs, tubs
253.1 81.57%
7 Machinery for the industrial preparation or manufacture of food or drink
33.0 #DIV/0! 7 Industrial monocarboxylic fatty acids; acid oils from refining; industrial fatty alcohols
242.9 22.29%
8 Prepared binders for foundry moulds or cores; chemical products
30.7 2.85% 8 Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of textile materials.
240.6 48.30%
9 Steam or other vapour generating boilers; super-heated water boilers
24.9 -0.51% 9 Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of leather
203.7 3.84%
10 Aerials and aerial reflectors of all kinds; parts suitable for use therewith
24.7 5178.94% 10 Cocoa butter, fat and oil 198.9 184.58%
TOTAL EXPORTS 2 765.2 -12.89% TOTAL IMPORTS 8 914.7 2.72%
Source: Quantec, 2016
14
3.4 Western Cape Trade with Indonesia
The Western Cape exported goods to the value of ZAR143m in 2015 while imported goods were valued at
ZAR1.1bn. The Western Cape has maintained a trade deficit with Indonesia, with imports exceeding exports over
the period 2006 to 2015.
Source: Quantec, 2016
The leading export product to Indonesia from the Western Cape was fresh apples, pears and quinces valued at
ZAR45m, followed by machinery for the industrial preparation or manufacture of food or drink (ZAR27m). The
fastest growing export products were grapes (62%), citrus fruit (56%) and insecticides, rodenticides, fungicides
(40%).
Indonesia has an appetite for Western Cape’s agriculture, forestry and fishing sector (41%), followed by metals,
metal products, machinery and equipment (26%) and petroleum products, chemicals, rubber and plastic (12%).
The leading import product into the Western Cape from Indonesia was Ceramic wares for laboratory valued at
ZAR253m, followed by cocoa butter (ZAR85m).
WESTERN CAPE’S EXPORTS TO INDONESIA, 2015 WESTERN CAPE’S IMPORTS FROM INDONESIA, 2015
RANK PRODUCT VALUE
2015 (ZARm)
% GROWTH
2011-2015
(USD)
RANK PRODUCT VALUE
2015 (ZARm)
% GROWTH 2011-2015
(USD)
1 Apples, pears and quinces, fresh. 44.9 5.19% 1 Ceramic wares for laboratory, chemical or other technical uses; ceramic troughs, tubs
253.0 122.39%
2 Machinery for the industrial preparation or manufacture of food or drink
27.1 - 2 Cocoa butter, fat and oil. 85.3 -
3 Citrus fruit, fresh or dried. 8.4 55.63% 3 Electric generating sets and rotary converters.
69.8 -
4 Fruit, nuts and other edible parts of plants
7.7 25.73% 4 Glassware of a kind used for table, kitchen, toilet, office, indoor decoration
68.1 11.95%
5 Beauty or make-up preparations and preparations for the care of the skin
7.1 - 5 Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of textile materials.
44.1 56.71%
6 Grapes, fresh or dried. 6.4 61.72% 6 Other plates, sheets, film, foil and strip, of plastics, non-cellular
33.0 -0.95%
7 Printing ink, writing or drawing ink and other inks
4.9 - 7 Other furniture and parts thereof. 32.2 0.51%
8 Insecticides, rodenticides, fungicides, herbicides, anti-sprouting products
4.5 39.89% 8 Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of leather.
28.6 -4.99%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Exports (ZARm) 171 134 273 326 429 469 416 191 327 143
Imports (ZARm) 350 586 444 1 824 457 1 142 1 128 974 791 1 093
Trade balance (ZARm) -179 -453 -171 -1 498 -28 -673 -712 -782 -464 -951
-2 000
-1 500
-1 000
-500
0
500
1 000
1 500
2 000
Valu
e (
ZA
Rm
)
WESTERN CAPE TARDE WITH INDONESIA, 2006-2015
15
WESTERN CAPE’S EXPORTS TO INDONESIA, 2015 WESTERN CAPE’S IMPORTS FROM INDONESIA, 2015
RANK PRODUCT VALUE
2015 (ZARm)
% GROWTH
2011-2015
(USD)
RANK PRODUCT VALUE
2015 (ZARm)
% GROWTH 2011-2015
(USD)
9 Mechanical appliances for projecting, dispersing or spraying liquids or powders; fire extinguishers
4.1 - 9 Pepper of the genus Piper; dried or crushed or ground fruits of the genus Capsicum
24.6 -
10 Recovered (waste and scrap) paper or paperboard.
3.3 4.50% 10 Synthetic filament yarn 24.5 11.53%
TOTAL EXPORTS 142.8 -16.60% TOTAL IMPORTS 1 093.5 20.58%
Source: Quantec, 2013
3.5 Tariffs
Indonesia is currently negotiating bilateral agreements with Iran, India, Australia, New Zealand, South Korea, and
the European Free Trade Association. In addition, Indonesia is studying potential FTAs with Chile, Turkey, Tunisia,
Mexico, South Africa, and Egypt. Indonesia is also participating in negotiations for the Regional Comprehensive
Economic Partnership, which includes the ten ASEAN members and six additional countries (Australia, China,
India, Japan, Korea, and New Zealand).
Tariffs imposed on Indonesian imports from South Africa for 2015 are listed below.
TARIFFS IMPOSED ON SOUTH AFRICAN IMPORTS BY INDONESIA, 2015
HS CODE AND PRODUCT
DESCRIPTION
TARIFF
(%)
HS CODE AND PRODUCT
DESCRIPTION
TARIFF
(%)
HS CODE AND PRODUCT
DESCRIPTION
TARIFF
(%)
H01: Live animals 3.4 H33: Essential oils, perfumes,
cosmetics, toiletries 17.3 H65: Headgear and parts thereof 8.7
H02: Meat and edible meat offal 6 H34: Soaps, lubricants, waxes,
candles, modelling pastes 5.3
H66: Umbrellas, walking-sticks,
seat-sticks, whips 10.3
H03: Fish, crustaceans, molluscs,
aquatic invertebrates 5.4
H35: Albuminoids, modified
starches, glues, enzymes 4.1
H67: Bird skin, feathers, artificial
flowers, human hair 8.8
H04: Dairy products, eggs, honey,
edible animal product 5.1
H36: Explosives, pyrotechnics,
matches, pyrophorics 5.6
H68: Stone, plaster, cement,
asbestos, mica, articles 7.2
H05: Products of animal origin 4.3 H37: Photographic or
cinematographic goods 4.5 H69: Ceramic products 16.5
H06: Live trees, plants, bulbs, roots,
cut flowers 11.1
H38: Miscellaneous chemical
products 5.3 H70: Glass and glassware 6.4
H07: Edible vegetables and certain
roots and tubers 5.4 H39: Plastics and articles thereof 9.1
H71: Pearls, precious stones,
metals, coin 4.6
H08: Edible fruit, nuts, peel of citrus
fruit, melons 6.7 H40: Rubber and articles thereof 7.3 H72: Iron and steel 5.3
H09: Coffee, tea, mate and spices 5 H41: Raw hides and skins (other
than furskins) and leather 0.3 H73: Articles of iron or steel 9.4
H10: Cereals 4.1 H42: Articles of leather, animal gut,
harness, travel goods 12.5 H74: Copper and articles thereof 4.9
H11: Milling products, malt,
starches, inulin, wheat gluten 6.3
H43: Furskins and artificial fur,
manufactures thereof 8 H75: Nickel and articles thereof 4.9
H12: Oil seed, oleagic fruits, grain,
seed, fruit, 1.5
H44: Wood and articles of wood,
wood charcoal 3.1 H76: Aluminium and articles thereof 5.4
H13: Lac, gums, resins, vegetable
saps and extracts 5 H45: Cork and articles of cork 5 H78: Lead and articles thereof 5.2
H14: Vegetable plaiting materials,
vegetable products 1.8
H46: Manufactures of plaiting
material, basketwork, etc. 5 H79: Zinc and articles thereof 1.8
H15: Animal, vegetable fats and
oils, cleavage products, 2.4
H47: Pulp of wood, fibrous
cellulosic material, waste 1.7 H80: Tin and articles thereof 5
H16: Meat, fish and seafood food
preparations 5
H48: Paper & paperboard, articles
of pulp, paper and board 4.8
H81: Other base metals, cermets,
articles thereof 3.8
H17: Sugars and sugar
confectionery 11.9
H49: Printed books, newspapers,
pictures 2.7
H82: Tools, implements, cutlery, of
base metal 3.3
H18: Cocoa and cocoa preparations 6.5 H50: Silk 7.1 H83: Miscellaneous articles of base
metal 9.7
16
TARIFFS IMPOSED ON SOUTH AFRICAN IMPORTS BY INDONESIA, 2015
HS CODE AND PRODUCT
DESCRIPTION
TARIFF
(%)
HS CODE AND PRODUCT
DESCRIPTION
TARIFF
(%)
HS CODE AND PRODUCT
DESCRIPTION
TARIFF
(%)
H19: Cereal, flour, starch, milk
preparations and products 5.1
H51: Wool, animal hair, horsehair
yarn and fabric thereof 8.1
H84: Nuclear reactors, boilers,
machinery 4.3
H20: Vegetable, fruit, nut food
preparations 5.8 H52: Cotton 5.7
H85: Electrical, electronic
equipment 1.9
H21: Miscellaneous edible
preparations 26.3
H53: Vegetable textile fibres paper
yarn, woven fabric 7.3
H86: Railway, tramway locomotives,
rolling stock, equipment 0.5
H22: Beverages, spirits and vinegar 89.9 H54: Manmade filaments 10.4 H87: Vehicles other than railway,
tramway 18
H23: Residues, wastes of food
industry, animal fodder 1.1 H55: Manmade staple fibres 7.8
H88: Aircraft, spacecraft, and parts
thereof 0
H24: Tobacco and manufactured
tobacco substitutes 24.6
H56: Wadding, felt, nonwovens,
yarns, twine, cordage 5.9
H89: Ships, boats and other floating
structures 4.5
H25: Salt, sulphur, earth, stone,
plaster, lime and cement 2.4
H57: Carpets and other textile floor
coverings 14.9
H90: Optical, photo, technical,
medical apparatus 4.7
H26: Ores, slag and ash 1.4 H58: Special woven or tufted fabric,
lace, tapestry 9.2
H91: Clocks and watches and parts
thereof 8.4
H27: Mineral fuels, oils, distillation
products, 0.9
H59: Impregnated, coated or
laminated textile fabric 8
H92: Musical instruments, parts and
accessories 7.5
H28: Inorganic chemicals, precious
metal compound, isotopes 4.7 H60: Knitted or crocheted fabric 10
H93: Arms and ammunition, parts
and accessories thereof -
H29: Organic chemicals 4.5 H61: Articles of apparel,
accessories, knit or crochet 14.9
H94: Furniture, lighting, signs,
prefabricated buildings 9.4
H30: Pharmaceutical products 3.5 H62: Articles of apparel,
accessories, not knit or crochet 14.8 H95: Toys, games, sports requisites 12.1
H31: Fertilizers 0 H63: Other made textile articles,
sets, worn clothing 12.5
H96: Miscellaneous manufactured
articles 9.3
H32: Tanning, dyeing extracts,
tannins, derivatives, pigments 5.2
H64: Footwear, gaiters and the like,
parts thereof 16.8
H97: Works of art, collectors pieces
and antiques 5
Source: Market Access Map, 2016
NOTE: Exporters should not take the HS2 tariff as conclusive and as the actual tariff that will be applied to the exported product.
The tariffs indicated above are average tariffs and for products within the category it may be higher or lower than indicated. Where
the tariff is zero it can be assumed that there is zero tariff applicable to all products within that HS code. Tariffs are determined
according to the importing country’s national tariff line from the HS6 level and upwards. Exporters are advised to visit
www.macmap.org to determine the exact tariff applicable to the product at HS6.
3.6 Trade Regulations Markings and Standards Import Tariff
In 2013 Indonesia’s average most-favored-nation applied tariff was 6.9 percent. Indonesia periodically changes its
applied rates thereby causing some unpredictability in the market. Luxury goods (defined as goods not considered
necessities), imported or locally produced, may be subject to a luxury tax of up to 200 percent. Currently, however,
there are no luxury goods subject to the 200 percent rate, and the applied luxury tax rates generally range from 10
to 75 percent, depending on the product.
Trade Barriers
Indonesia continues to enforce a ban on imports of poultry parts, which has been in place since 2000. An
Indonesian Ministry of Finance regulation imposed import duties on alcoholic beverages containing ethyl alcohol
on April 7, 2010. This regulation changed the tariff from an ad valorem tariff to a specific tariff. The new tariff ranges
from Indonesian rupiah (Rp.) 14,000/liter to Rp. 125,000/liter. The Indonesian Ministry of Finance also eliminated
the luxury tax on alcoholic beverages and increased the excise tax. The excise tax ranges from Rp 13,000 to Rp.
139,000 per liter.
Labelling
All imported consumer goods must identify the importing agents. The GOI requires that information on product
labels be distinctly and clearly written or printed or shown so that it can be seen easily and understood. The
information on product labels should be written or printed in the Indonesian language, Arabic numbers, and Latin
17
letters. The use of language, numbers, and letters other than the Indonesian language will only be permitted when
there are no matching terms, or in the event of trading abroad.
Labeling should not contain the following: claims on the effect of the product on health, whether preventative and/or
curative; incorrect or misleading information; comparisons to other products; promotion of certain similar products;
and any additional information that has not yet been approved.
3.7 Port-to-Port Rates
Major ports and harbors include Cilacap, Cirebon, Jakarta, Kupang, Palembang, Semarang, Surabaya, and
Makassar. Ports are managed by the various Indonesia Port Corporations, of which there are four. Each has
jurisdiction over various regions of the country. The table below shows the transit times for shipping from Cape
Town to the four largest ports in Indonesia.
TRANSIT TIME FROM CAPE TOWN TERMINAL TO THE FOUR LARGEST PORTS IN INDONESIA, 2013
TERMINAL DISTANCE TRANSIT TIME
Jakarta Port 9624.13 km 15 days(s) 11 hours
Surabaya Port 10306.09 km 16 days(s) 13 hours
Belawan 9784.00 km 15 days(s) 17 hours
Ujung Pandan 9784.00 km 15 days(s) 17 hours
Source: SeaRates, 2016
18
4. Investment
4.1 Global Investment into Indonesia
Between January 2003 and December 2015 a total of 1,696 FDI projects were recorded into Indonesia. These
projects represent a total capital investment of ZAR2, 889.86bn which is an average investment of ZAR1, 703.66m
per project. During the period, a total of 540,820 jobs were created.
Source: FDI Intelligence, 2016
Japan was the largest source market for inward FDI into Indonesia in terms of projects, with 382 investment projects,
accounting for 22.52%. The United States and Malaysia are ranked second and third accounting for 10.85% and
7.08% respectively.
TOP SOURCE MARKETS FOR FDI INTO INDONESIA, 2003 - 2015
RANK COUNTRY PROJECTS %
PROJECTS CAPEX (ZARm)
% CAPEX
COMPANIES %
COMPANIES
1 Japan 382 22.52% 477 805 16.53% 271 22.07%
2 United States
184 10.85% 394 729 13.66% 137 11.16%
3 Malaysia 120 7.08% 146 286 5.06% 87 7.08%
4 Singapore 99 5.84% 131 165 4.54% 58 4.72%
5 China 89 5.25% 381 654 13.21% 66 5.37%
6 South Korea
75 4.42% 175 900 6.09% 53 4.32%
7 UK 75 4.42% 114 457 3.96% 60 4.89%
8 France 74 4.36% 141 687 4.90% 36 2.93%
9 Germany 74 4.36% 46 544 1.61% 50 4.07%
10 India 72 4.25% 135 047 4.67% 52 4.23%
Total 1 696 100% 2 889 862 100% 1 228 100%
Source: FDI Intelligence, 2016
The figures below show global inward FDI into Indonesia by sector, for the period January 2003 to December 2015
by number of projects and CAPEX. The coal, oil and natural gas sector and the food and tobacco sector received
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Capex (ZARm) 125 37 145 80 102 00 156 06 201 81 382 07 304 69 153 04 289 75 160 45 214 26 202 98 451 53
Projects 62 64 74 103 87 137 120 131 171 192 212 170 173
50
100
150
200
250
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
500 000
Pro
jects
Valu
e (
ZA
Rm
)
INWARD FDI INTO INDONESIA, 2003 - 2015
19
the largest FDI accounting for 9% each followed by the financial services sector and metals sector at 7% each. In
terms of CAPEX coal, oil and gas was again the largest with 31%, followed by metals at 24%.
Source: FDI Intelligence, 2016
Source: FDI Intelligence, 2016
Indonesia’s retail sub-sector received the largest share of FDI in terms of projects between January 2003 and
December 2015, followed by the automobiles and freight/distribution services 2.83% and 2.71% respectively. In terms
of capex, the oil and gas sector received the largest FDI accounting for 10.81%, followed by fossil fuel electric power
at 7.62%.
Coal, Oil and Natural Gas31% Metals
24%
Chemicals7%
Alternative/Renewable energy
4%
Food & Tobacco4%
Automotive OEM4%
Real Estate4%
Rubber3%
Transportation2%
Financial Services2%
Other sectors15%
INWARD FDI INTO INDONESIA SECTOR BY CAPEX, 2003 - 2015
Coal, Oil and Natural Gas9% Food & Tobacco
9%
Financial Services
7%
Metals7%
Business Services
6%
Software & IT services5%
Transportation5%
Chemicals5%
Automotive Components
5%
Automotive OEM4%
Other sectors38%
INWARD FDI INTO INDONESIA SECTORS BY PROJECTS, 2003 - 2015
20
Source: FDI Intelligence, 2016
4.07%
2.83%
2.71%
2.65%
2.54%
2.36%
2.18%
2.18%
2.12%
2.00%
1.89%
1.77%
1.71%
1.65%
1.53%
1.53%
1.47%
1.42%
1.36%
1.36%
0.96%
3.24%
1.06%
0.17%
10.81%
3.45%
0.44%
0.86%
0.94%
2.76%
0.25%
0.96%
5.27%
0.82%
1.88%
0.56%
0.34%
7.62%
0.08%
0.09%
0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00%
Retail banking
Automobiles
Freight/Distribution Services
Software publishers, except video games
Oil & gas extraction
Steel products
Clothing & clothing accessories
Paints, coatings, additives & adhesives
Food & Beverage Stores (Food & Tobacco)
Other petroleum & coal products
Other motor vehicle parts
Cosmetics, perfume, personal care & householdproducts
Basic chemicals
Motorcycle, bicycle, & parts
Accommodation
Insurance
Corporate & investment banking
Fossil fuel electric power
Advertising, PR, & related
Internet publishing & broadcasting & web search
INWARD FDI INTO INDONESIA, 2003 - 2015
capex projects
21
4.2 Global Investment from Indonesia
Between January 2003 and December 2015 a total of 126 FDI projects were recorded from Indonesia. These
projects represent a total capital investment of ZAR204.44bn which is an average investment of ZAR1.62bn per
project. During the period, a total of 33,194 jobs were created.
Source: FDI Intelligence, 2016
China was the largest destination market in terms of projects for FDI from Indonesia, with 25 investment projects,
accounting for 19.84%. Singapore and Malaysia are ranked second and third accounting for 10.32% and 8.73%
respectively. The top 6 destination markets are Asian markets.
TOP DESTINATION MARKETS FOR FDI OUT OF INDONESIA, 2003 - 2015
RANK COUNTRY PROJECTS %
PROJECTS CAPEX (ZARm)
% CAPEX COMPANIES %
COMPANIES
1 China 25 19.84% 141 007 68.97% 21 28.00%
2 Singapore 13 10.32% 4 110 2.01% 12 16.00%
3 Malaysia 11 8.73% 2 185 1.07% 10 13.33%
4 Myanmar (Burma)
10 7.94% 11 193 5.48% 9 12.00%
5 India 8 6.35% 1 449 0.71% 6 8.00%
6 Vietnam 8 6.35% 3 595 1.76% 8 10.67%
7 Saudi Arabia 6 4.76% 1 127 0.55% 3 4.00%
8 Netherlands 4 3.17% 595 0.29% 4 5.33%
9 United States 4 3.17% 865 0.42% 4 5.33%
10 Australia 3 2.38% 539 0.26% 3 4.00%
Total 126 100% 204 437 100% 75 100%
Source: FDI Intelligence, 2016
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Projects 8 8 7 5 9 4 10 11 4 17 9 21 13
Capex 55 28 2 043 5 457 8 508 19 97 1 592 12 85 3 421 58 55 10 09 4 201 14 23 8 223
5
10
15
20
25
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
Pro
jects
valu
e (
ZA
Rm
)
OUTWARD FDI FROM INDONESIA, 2003 -2015
22
Financial services and coal, oil and natural gas both received the largest FDI from Indonesia by projects accounting
for 13% and 8% respectively. This was followed by the communications sector at 7%. In terms of capex paper,
printing and packaging received the largest FDI at 45%, followed by real estate at 16% and coal, oil and natural
gas at 10%.
Source: FDI Intelligence, 2016
Source: FDI Intelligence, 2016
In terms of sub-sectors, the retail banking sector received the largest FDI from Indonesia at 11.90%, followed by
clothing and clothing accessories and cosmetics, perfume, personal care & household products at 5.56% and
4.76% respectively. Pulp, paper and paperboard received the largest FDI from Indonesia in terms of capex
accounting for 43.71% followed by residential building construction oil and gas accounting for 16.10% and 6.23%
respectively.
Financial Services13%
Coal, Oil and Natural Gas8%
Communications7%
Consumer Products6%
Paper, Printing & Packaging
6%
Textiles6%Food & Tobacco
6%
Software & IT services6%
Real Estate5%
Transportation5%
Other sectors32%
OUTWARD FDI BY INDONESIA INTO GLOBAL SECTORS BY PROJECTS, 2003 - 2015
Paper, Printing & Packaging
45% Real Estate16%
Coal, Oil and Natural Gas10%
Chemicals5%
Healthcare3%
Building & Construction MaterialsFinancial Services
3%
Rubber2%
Transportation2%
Warehousing & Storage
2%
Other Sectors9%
OUTWARD FDI BY INDONESIA INTO GLOBAL SECTORS BY CAPEX, 2003 - 2015
23
Source: FDI Intelligence, 2016
11.90%
5.56%
4.76%
3.97%
3.97%
3.97%
3.97%
3.17%
3.17%
3.17%
3.17%
3.17%
3.17%
2.38%
2.38%
1.59%
1.59%
1.59%
1.59%
1.59%
2.37%
0.31%
0.84%
1.72%
3.70%
0.22%
0.24%
2.59%
1.32%
6.23%
43.71%
16.10%
0.02%
3.51%
0.17%
0.35%
0.32%
0.61%
0.09%
0.38%
0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% 45.00% 50.00%
Retail banking
Clothing & clothing accessories
Cosmetics, perfume, personal care & household products
Air transportation
Other petroleum & coal products
Software publishers, except video games
Wireless telecommunication carriers
Cement & concrete products
Converted paper products
Oil & gas extraction
Pulp, paper, & paperboard
Residential building construction
Travel arrangement & reservation services
General medical & surgical hospitals
Nonferrous metal production & processing
Basic chemicals
Commercial & institutional building construction
Data processing, hosting, & related services
Fishing, hunting & trapping
Grains & oilseed
OUTWARD FDI FROM INDONESIA BY SUB-SECTORS, 2003 - 2015
Capex Projects
24
4.3 Investment Relations between South Africa and Indonesia
In February 2015 - a subsidiary of South Africa-based Switchless, invested in the city of Jakarta, in the Software &
IT services sector valued at ZAR75m and created 23 jobs. Also in February 2015 South Africa-based Cartrack, a
provider of fleet management, stolen vehicle recovery, and insurance telematics services, opened a new office in
Jakarta. The firm has expanded its presence in Asia to meet strong demand for fleet management and stolen
vehicle recovery services. The investment is valued at ZAR75m and created 23 jobs.
Previous to the above investments, SRK Consulting (South Africa) invested in the city of Jakarta in 2009 in the
business services sector in a business services project, valued at ZAR28.1m and creating 10 jobs. The company
is an independent, international consulting practice that provides advice and solutions to clients, mainly from earth
and water resource industries.
There was no recorded FDI into South Africa from Indonesia recorded by FDI Intelligence.
SOUTH AFRICAN FDI INTO INDONESIA, 2003 - 2015
DATE INVESTING COMPANY
SOURCE CITY
SECTOR SUB -SECTOR INDUSTRY ACTIVITY
CAPEX (ZARm)
JOBS
Feb 2015
Cartrack Gauteng Software & IT services
Software publishers, except video games
Sales, Marketing & Support
75.0 23
Feb 2015
BitX Western Cape
Software & IT services
Software publishers, except video games
Sales, Marketing & Support
75.0 23
Jan 2009
SRK Consulting
Gauteng Business Services
Architectural, engineering, & related services
Business Services
28.1 10
Total 178.1 56
Source: FDI Intelligence, 2016
25
5. Tourism
5.1 Indonesia Trends and Travel Patterns
According to Business Monitor International (2016), over the medium term, as the economy in Indonesia grows,
we expect to see a strong increase in private financial consumption of around 6% a year, as an affluent middle
class develops in the country, boosting the potential of both the domestic tourism market and the smaller outbound
tourism market. Thanks to this growth in the domestic economy, we expect that outbound travel will increase to
10.0mn in 2020 from 9.5mn in 2016, meaning the number of average tourist departures per 1,000 of the population
will remain around 0.04 during the forecast period. This growth indicates a range of opportunities for travel providers
and tour operators in Indonesia; however, the domestic travel market will remain more substantial for some time to
come.
5.2 Indonesia Tourist Arrivals into South Africa
The graph below depicts total tourist arrivals from Indonesia into South Africa between 2013 and 2015. The number
of Indonesia arrivals into South Africa decreased by 34% in 2015 in line with other markets that were affected by
global economy slowdown.
Source: SATourism, 2016
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2013 2014 2015
Total Arrivals 3 486 3 102 2 040
Growth -11.02% -34.24%
-40.00%
-35.00%
-30.00%
-25.00%
-20.00%
-15.00%
-10.00%
-5.00%
0.00%
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
% G
row
thT
ou
rist
Arr
ivals
INDONESIA TOURIST ARRIVALS TO SOUTH AFRICA, 2013-2015