Sunday, May 15, 2011

Business and on the Indonesia market overview

ECONOMY. The Indonesia is a market-based economy, but the Government plays an important role in the economy of the country with 160 State-owned enterprises. Indonesia GDP per capita class fifth after Singapore, Brunei, Malaysia and Thailand. The 1997 Asian economic crisis has adversely affected the economy of the country and businesses and caused a spiralling prices of products of first necessity resulting from social unrest. The future of the economy of the Indonesia prospects are bright with structural economic reforms in placed since the Asian economic crisis.

Indonesia GDP was 258.3 billion with a GDP per capita of US$ inhabitants in 2004. The Indonesia real GDP increased on average by 4.6% per year from 2000 to 2004, led by the accountant of domestic consumption for almost three quarters of the GDP Indonesia. Inflation rose from 3.8% in 2000 to 11.9% in 2002 but finally declined 6.1% in 2004. Past GDP per capita of US$ 801 in 2000 to US$ inhabitants in 2004 but also increased 6.1% to 9.9% in the period of unemployment.

The manufacturing sector contributed 43.7% of the Indonesia of GDP in 2004, while the services sector contributed 40.9%. Although almost 45% of the active population of the country is involved in agriculture, this sector contributed only 15.4% of the GDP of the country during the period. Major industries include oil, and natural gas, textiles, clothing, footwear, mining, cement, chemical fertilizers, plywood, rubber, food and tourism. Agriculture major products include rice, palm oil, rubber, cocoa, peanuts, copra and cloves.

DEMOGRAPHY. The Indonesia is composed of almost 18,000 islands and has the largest population among the countries of Southeast Asia with 217 million in 2004. Main islands are accounting for 55% of the population of Sumatra (18%), Java Kalimatan (5%) and Sulawesi (6%). Other less populated islands include Irian Jaya, Bali and Nusa Tenggara.

The Indonesia is a country of diverse ethnic communities and with different languages and dialects, cultures and food. The Javanese represents 45% of the population followed by Sundanese (14%) and the Madurese (8%) and coastal Malays (8%). Chinese who migrated to the Indonesia during the Dutch colonial period account 5% of the population. Islam is the dominant religion, followed by Christianity and minority religions include Buddhism and Hinduism. The Bahasa Indonesia (similar to Malay used in Malaysia, Singapore, and Brunei) is the national language. English is not widely used but of many companies and representatives of Government dealing with foreigners and foreign companies are commonly the language.

More than half the population live in rural areas, but the proportion of the urban population is from 36.0% in 1995 to 45% in 2004. Major cities include Jakarta with a population of 10 million follow-up of Surabaya, Bandung, Semarang, Yogyakarta, Surakarta, Medan and Padang.
About 25% of the population living below the poverty line while another 60% are in the lower income group. The remaining 10% belong to income means and 5% in the highest income group. Although the Indonesia has a relatively low proportion of average high income consumers, this is equivalent to 33 million consumers. It is more Singapore 4.3 million people with a GDP per capita comparable to those of many economies of the European Union.

INFRASTRUCTURE. The Indonesia domestic telecommunication system is generally fair, while its international services can be classified as good. Broadband Internet services are mainly concentrated in large cities. Road systems are more developed on the Indonesia populated island of Java, developed in Sumatra and Sulawesi, but poorly developed on the island of Kalimantan. In addition to seaports serving international lines, Indonesia are also served by small seaports, coastal shipping service. The main towns and cities are connected by air transport services.

INTERNATIONAL TRADE. Major trading partners of the Indonesia to the Japan, us, Singapore, Korea of the South, and China. A large part of imports from Singapore are re-exports of Singapore from other countries and exports to Singapore are re-exported to other countries. The Indonesia exports include oil and gas, electrical appliances, plywood, textile and rubber products. Major imports include machinery and equipment, transport equipment, chemicals, fuel and food.

USE OF TECHNOLOGY CONSUMERS. The mobile phone penetration is only 13% of the population, which is less than Singapore (93%), Malaysia (67%) and Thailand (45%). In addition, there are fixed phones for only $ 10 million in the service of the whole country. Computer penetration is less than 2% of households and the country has only 1.2 million internet subscribers with 12 million internet users or a penetration rate of only 0.5% of the population. Most high income and the average houses would be owner of televisions, but penetration in lower income households is lower. Java TV penetration rate is about 60% and Sumatra 52%. Similar scenario exists for refrigerators.

RETAIL MARKET. Sales in the retail food and non food totalled estimated at 32 billion dollars in 2004. Many Indonesians still shop at traditional markets or establishments "mom and pop" shopping in modern shopping malls, hypermarkets, supermarkets, convenience stores and supermarkets, but more and more popular. There are some 5 000 these modern institutions in Indonesia, accounting for the retail sales of 4.5 billion US dollars in 2004. Most of these establishments are concentrated on the island of Java, followed by of Sumatra. Since 1998, the Government opened the retail of foreign investment and industry participation.

FOOD CULTURE. The Indonesia food culture is diverse because of the different ethnic communities that made up the population of the country. Typical meals consumed are occasionally of rice and noodle dishes. However, there are many facilities for the rapid restoration of the West franchise located primarily in the major cities such as Jakarta, Surabaya, Bandung, Semarang and Yogyakarta. Workplace to the point of sale high range of bakery products in the service of Western bakeries and local are also present in large cities.

Khal Mastan is Senior Consultant at Pegasus Business and advisory market ([]) by Malaysia. He is involved in the business and marketing research and provides consulting services in the markets in Southeast Asia namely Malaysia, Thailand, Singapore, Indonesia, the Philippines and Brunei. He has more than 20 years of experience in the region and work experience in various industries. He holds a Bachelor's degree in Biochemistry and an MBA. He can be contacted at or + 6 7726 5373 (03) in Malaysia.

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