• Cement Sales in Indonesia Rise in February, Export in Focus

    Cement sales in Indonesia rose 3 percent year-on-year (y/y) to 4.45 million tons in February 2016 from the same month one year earlier. Widodo Santoso, Chairman of the Indonesian Cement Association (ASI), said Indonesia's rising cement sales were caused by the ongoing development of infrastructure projects across the archipelago. Three regions showed a marked increase in cement sales last month: Sumatra (+16.5 percent y/y to 2.13 million tons), Sulawesi (+33 percent y/y to 841,000 tons) and the Moluccas & Papua (+31 percent y/y to 125,000 tons).

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  • Crude Palm Oil Industry Indonesia: CPO Production Down, Price Up?

    Fadhil Hasan, Executive Director of the Indonesian Palm Oil Association (Gapki), expects Indonesia's crude palm oil (CPO) production to decline to around 32.1 million tons in 2016 from 32.5 million tons in the preceding year. This decline, which would be the first (full calendar year) drop in Indonesia's palm oil output since 1998, is caused by the El Nino weather phenomenon. El Nino causes dry weather in Southeast Asia hence curtailing palm oil fruit yields. CPO production in Malaysia, the world's second-largest CPO producer and exporter (after Indonesia), has also been affected.

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  • Lower Fuel Prices Would Improve Indonesia's Purchasing Power

    Indonesia's economic growth in the first quarter of 2016 could reach 5 percent (or more) year-on-year provided that the government manages to optimize spending on infrastructure projects and improve people's purchasing power. Large drops in domestic car and motorcycle sales so far this year show that Indonesia's purchasing power remains bleak. Other indicators - such as cement and retail sales - are also not too strong. Firmanzah, economist at the Paramadina University, said the 0.09 percent (m/m) deflation that occurred in February could be a sign of further weakening purchasing power.

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  • Foreign Exchange Reserves Indonesia Climb in February 2016

    The foreign exchange reserves of Indonesia rose USD $2.4 billion to USD $104.5 billion in February 2016 according to a statement of Indonesia's central bank (Bank Indonesia). The lender of last resort attributed this forex growth to foreign exchange receipts from the oil & gas sector, foreign debt withdrawals, and the sale of foreign-denominated bonds (SBBI). These receipts were more than enough to cover for the use of foreign exchange for public foreign debt payments.

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