The Indonesia Investment Coordinating Board (BKPM) announced today (27/07) that - in rupiah terms - foreign direct investment (FDI) in Indonesia rose 18.2 percent (y/y) to IDR 92.2 trillion rupiah in the second quarter of 2015, the fastest growth pace recorded since 2013. However, in US dollar terms, FDI fell to USD $7.38 billion in Q2-2015 from USD $7.43 billion in the same quarter one year earlier. The BKPM uses an IDR 12,500 per US dollar exchange rate in 2015 and an IDR 10,500 per US dollar exchange rate in 2014.

Read more ›

Over the past two days more than 900 migrants (believed to be Rohingya Muslims from Myanmar and Bangladesh) have been rescued from overcrowded wooden boats near the coastal area of Indonesia’s Aceh province at the northern tip of Sumatra. After being spotted by local fishermen, these boats were towed to Acehnese shore. Meanwhile, in Malaysia more than 1,000 migrants from Myanmar and Bangladesh were found in shallow waters near Langkawi after being abandoned by human traffickers.

Read more ›

State-controlled Bank Mandiri, the leading bank in Indonesia in terms of asset size, will be allowed to open 20 branches in Malaysia after financial authorities in Indonesia and Malaysia signed an agreement. Although Muliaman D Hadad, Chief Commissioner at Indonesia’s Financial Services Authority (OJK), said that the government of Malaysia still needs to ratify the agreement, it is expected that Bank Mandiri will be able to open its Malaysian branches before the end of the year.

Read more ›

The government of Indonesia plans to adjust its crude palm oil (CPO) export tax policy. Chief Economics Minister Sofyan Djalil said that the government is about to impose a fixed levy of USD $50 per metric ton on CPO exports when CPO prices decline below the government’s threshold of USD $750 per ton, implying that it will become impossible for Indonesian palm oil exporters to ship output without charge. Currently, palm oil exporters can export CPO output duty-free as prices have been below the USD $750 threshold since September 2014.

Read more ›

It is estimated that Indonesia’s export of crude palm oil (CPO) and its derivatives have fallen in February 2015 due to sluggish demand from India and China, the world’s two largest palm oil importers, while the globe’s soybean output increased (soybean oil is a close substitute to palm oil for food and biodiesel uses). Based on a median of six palm oil growers, analysts and official estimates, Indonesian shipments of palm oil (including palm kernel) fell six percent month-to-month (m/m) to 1.7 million metric tons in February.

Read more ›

Commission XI of Indonesia’s House of Representatives (DPR), which oversees the country’s banking sector, will soon propose a new draft of a bill that sets to limit foreign ownership in Indonesian banks at 40 percent (from 99 percent currently). Established banks that are majority-owned by foreigners will be given a 10-year period to divest their shares after the bill has been passed into law (reportedly an earlier draft only provided a five-year transition period for this mandatory divestment).

Read more ›

Indonesia’s production of crude palm oil (CPO) is estimated to reach 31 million tons this year, up from an expected 29.5 million tons in 2014, according to the Indonesian Palm Oil Board (DMSI). Similar to last year, CPO production growth is limited due to unconducive weather conditions in the world’s largest producer and exporter of palm oil. Moreover, old trees have become less productive, while the younger generation of planted trees have not yet reached an optimal production age.

Read more ›

The world’s two largest crude palm oil (CPO) producers and exporters, Indonesia and Malaysia, are expected to maintain their zero percent export tariffs for CPO in January 2015 according to Dorab Mistry, Executive at Godrej Industries Ltd (India's leading manufacturer of oleochemicals), in an interview to international news agency Reuters. Authorities in Malaysia (since September 2014) and Indonesia (since October 2014) have implemented duty-free CPO shipments in an effort to boost global CPO demand and prices.

Read more ›

Exports of Indonesian crude palm oil (CPO) and its derivatives may increase to 21.6 million tons (collecting about USD $16.0 - 17.3 billion in foreign exchange) in 2015. Meanwhile, Indonesian CPO production is estimated to reach 32.5 million tons next year while the CPO price is estimated to range between USD $740 - 800 per ton. However, provided that the Indonesian government will extend its current zero export tariff scheme for CPO exports, then the country’s CPO exports are expected to accelerate.

Read more ›

Indonesia welcomed a total of 808,767 foreign tourists in October 2014, up 12.3 percent from the same month last year, according to official data from Statistics Indonesia (BPS). Meanwhile, on a month-to-month basis, foreign tourist arrivals rose 2.2 percent from September 2014. Suryamin, Chief at BPS, said that the highest percentage increases on a month-to-month basis occurred in Adi Sucipto International Airport (Yogyakarta), followed by the Port of Tanjung Priok (Jakarta), and Sultan Syarif Kasim II International Airport (Riau).

Read more ›

Despite positive results of monthly US Factory Orders and Economic Optimism, it did not support Asian stock markets up to the end of Wednesday's trading day. The Indonesia Stock Exchange (IHSG), on the other hand, maintained its upward movement to reach 4,981.47, a 0.49 percent gain. Matters that supported the IHSG's performance to yet another new record high level, were well-received 2012 company reports as well as expected dividend payouts.

Read more ›