Indonesia – Investment Must Be

indonesia-map

Indonesia has become a magnet for foreign investment.

Why?

Because Indonesia is the largest economy in Southeast Asia … 4th largest population in the world and has been resistant to the global financial crisis, proven by its:

Explosive Economic Growth

Indonesia’s GDP growth in 2011 was 6.5% that is higher than the United States, United Kingdom, Hong Kong, Denmark, Thailand, Germany, France, Belgium and Brazil combined…

Yes that is right… all these country’s GDP growths combined together is lower than the GDP growth of Indonesia on its own…

Political Stability

“Indonesia is among the most politically stable countries in Asia, and deserves more attention from global investors” – bloomberg.com

“Significantly, Indonesia is the only country in Southeast Asia that has bucked the trend of a democracy in trouble. Democracy is blossoming in a country that was once ruled with an iron hand.” – BKPM (Indonesia Investment Coordinating Board)

“Indonesia is as politically stable as it has ever been, we expect both domestic and foreign investors to continue” – bloomberg.com

“Indonesia is a political success story” – forbes.com

Favourable Investment Ratings

“Indonesia, in terms of sovereign risk, is better than several Western European countries,” said Jerome Booth from Ashmore Investment Management in London.

•Fitch: Awarded Indonesia investment grade status in December 2011 the agency said “Indonesia has resilient economic growth, low government debt and prudent policy.”

•S&P (Standard & Poor’s): “S&P said Indonesia’s fundamentals remain strong”

•Moody’s: Awarded Indonesia investment grade status in January 2012 – “Indonesia’s cyclical resilience to large external shocks points to sustainably high trend growth over the medium term,” said Moody’s in a statement.

•BBC: “The stamps of approval are likely to bring much foreign investment into south east Asia’s biggest economy.” Said the BBC in response Moody’s & Fitch’s upgrades to Indonesia’s investment status.

•IMF (International Monitory Fund): “Indonesia’s economy continues to perform well. At 6.5 percent, economic growth in 2011 was the highest in over a decade; inflation is currently within the central bank’s target range, credit growth is robust, and measures of business and consumer confidence remain strong.”

•HSBC Bank: “Overall investment climate in Indonesia is very attractive to foreign investment”

Snowballing Tourism Industry

 

Since 2000, on average, there have been five million foreign tourists each year who spend an average of US$100 per day.

With average visit duration of 9–12 days, Indonesia gains US$4.6 billion of foreign exchange income annually.

4.6 Billion US Dollars would be a stack of $100 notes 5.02 Kilometres high or the equivalent height of nearly 15 and a half Eiffel towers…

Indonesian Minister for Tourism and Creative Economy Mari Elka Pangestu said the government has set a target of 8 million foreign holidaymakers for 2012

75% of Indonesia’s visitors come from the Asia-Pacific region, with Singapore, Malaysia, Australia, Japan and China among the top countries of origin.

The United Kingdom, France, and Germany are the largest sources of European visitors.

The top ten tourist destinations in Indonesia recorded by Central Statistics Agency (BPS) are Bali, West Java, Central Java, East Java, Jakarta, North Sumatra, Lampung, South Sulawesi, South Sumatra, Banten and West Sumatra (which would make it 11 provinces today due to Banten previously having been a part of West Java).

Around 59% of all visitors are travelling to Indonesia for holiday, while 38% for business purposes.

Research by the World Tourism and Travel Council (WTTC), a global organization of travel industry professionals:

The WTTC forecasts that the sector — including domestic tourism — will contribute $26 billion to GDP in 2011, 3.2 percent of the total.

However, given tourism’s effect on demand in other sectors, the council estimates that the total contribution to GDP, direct and indirect, will come to $75.3 billion, or 9.1 percent of the total.

The WTTC expects tourism to grow strongly over the next 10 years, forecasting 5.8 percent average annual growth of both sector GDP and overall economic impact. Meanwhile, it expects investment in the sector to grow by 6 percent annually, from $9.5 billion in 2011.

Soaring Land Prices:

302% In 5 Years?

 

In some of Indonesia’s tourist hot spots such as Bali, land prices in key areas have increased in value by as much as 302% in the last five years… Click Here to find out which areas these are…

2.8 million tourists visited Bali in 2011 out of the 7.65 million tourists who visited Indonesia that year Bali had over 36% of them.

With the World Tourism and Travel Council (WTTC) expecting tourism to grow strongly over the next 10 years (at 5.8 percent average annual growth)…

It is no wonder that land prices in key tourist hot spots will continue to soar in value as they have done consistently over the last 8 years.

Indonesia Demographics

According to the 2010 national census, the population of Indonesia is 237.6 million, with high population growth at 1.9%. 58% of the population lives on Java, the world’s most populous island. Despite a fairly effective family planning program that has been in place since the 1960s, population is expected to grow to around 265 million by 2020 and 306 million by 2050.

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. A sense of Indonesian nationhood exists alongside strong regional identities. Society is largely harmonious, although social, religious and ethnic tensions have triggered horrendous violence. Chinese Indonesians are an influential ethnic minority comprising 3–4% of the population. Much of the country’s privately owned commerce and wealth is Chinese-Indonesian-controlled, which has contributed to considerable resentment, and even anti-Chinese violence.

The official national language is Indonesian, a form of Malay. It is based on the prestige dialect of Malay, that of the Johor-Riau Sultanate, which for centuries had been the lingua franca of the archipelago, standards of which are the official languages in Singapore, Malaysia and Brunei. Indonesian is universally taught in schools, consequently it is spoken by nearly every Indonesian. It is the language of business, politics, national media, education, and academia. It was promoted by Indonesian nationalists in the 1920s, and declared the official language under the name Bahasa Indonesia on the proclamation of independence in 1945. Most Indonesians speak at least one of the several hundred local languages and dialects, often as their first language. Of these, Javanese is the most widely spoken as the language of the largest ethnic group. On the other hand, Papua has over 270 indigenous Papuan and Austronesian languages, in a region of about 2.7 million people.

While religious freedom is stipulated in the Indonesian constitution, the government officially recognizes only six religions: Islam, Protestantism, Roman Catholicism, Hinduism, Buddhism, and Confucianism. Although it is not an Islamic state, Indonesia is the world’s most populous Muslim-majority nation, with 86.1% of Indonesians being Muslim according to the 2000 census. On 21 May 2011 the Indonesian Sunni-Shia Council (MUHSIN) was established. The council aims to hold gatherings, dialogues and social activities. It was an answer to violence committed in the name of religion. The majority of Muslims in Indonesia are Sunni. 9% of the population was Christian, 3% Hindu, and 2% Buddhist or other. 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. Islam was first adopted by Indonesians in northern Sumatra in the 13th century, through the influence of traders, and became the country’s dominant religion by the 16th century. Roman Catholicism was brought to Indonesia by early Portuguese colonialists and missionaries, and the Protestant denominations are largely a result of Dutch Calvinist and Lutheran missionary efforts during the country’s colonial period. A large proportion of Indonesians—such as the Javanese abangan, Balinese Hindus, and Dayak Christians—practice a less orthodox, syncretic form of their religion, which draws on local customs and beliefs.

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