The Business Times

Indonesian economy: The Jokowi boost

How do you see Indonesia's economic prospects under the new Jokowi administration? What opportunities for Singapore businesses would there be?

Published Sun, Aug 17, 2014 · 10:00 PM
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Max Loh

Country Managing Partner

Ernst & Young LLP

THE outlook for the Indonesian economy remains positive with consumer confidence generally high, core inflation below 5 per cent and the rupiah showing some recent strength. The Jokowi administration looks set to build on this through a pragmatic and pro-business approach and via key reforms. The immediate challenge is the current account deficit, which is expected to increase due to low coal prices, the implemented ban on certain mineral ore exports and high oil imports. Sustainable cuts in fuel subsidy will provide the incoming government with more scope to increase spending on services and infrastructure.

The key lies in enhancing GDP growth in the medium term through speeding up structural reforms. The incoming administration's economic priorities and focus on infrastructure improvements, public services, law enforcement and labour relations should bring more business opportunities for foreign investors and Singapore businesses, particularly in the consumer, oil and gas, automotive and transpor…

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