Below is a list with tagged columns and company profiles.

Today's Headlines China

  • Indonesia & the Global Economy; Rupiah Hit by China & Japan Data

    On Monday morning (08/12), the Indonesian rupiah exchange rate quickly plunged after the release of weak macroeconomic data from Japan and China, two important trading partners of Indonesia. Economic growth in Japan, the world’s third-largest economy, contracted 0.5 percent (quarter-to-quarter) in Q3-2014, while Chinese imports fell 6.7 percent (year-on-year) in November 2014. As a result the Indonesian rupiah had depreciated 0.54 percent to IDR 12,365 per US dollar by 11:30 am local Jakarta time, the weakest level in six years.

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  • Indonesia Signs MoU to Join Asian Infrastructure Investment Bank

    Indonesia’s Finance Minister has signed a memorandum of understanding (MoU) in the context of Indonesia’s participation within the Asian Infrastructure Investment Bank (AIIB). The AIIB is a new multilateral international financial institution (initiated by China) that is to provide funds for infrastructure projects in the Asia Pacific region. This new institution is seen as a challenge to the World Bank, International Monetary Fund (IMF), and Asian Development Bank (ADB) which are all regarded as being dominated by developed countries.

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  • Indonesia’s Steel Industry Affected by Oversupply in China

    Irvan Kamal Hakim, Director at Krakatau Steel (Indonesia’s largest steel manufacturer), said that the domestic steel industry is still affected by prolonged concerns about excess steel supply in China, the world's largest steel producer. Amid slowing economic growth in the world’s second-largest economy, domestic steel demand in China has declined resulting in a global oversupply of 525 million tons. Each 1 percent decline in GDP growth in China results in an additional oversupply of 24 million tons of steel.

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  • Analysis & Forecast of Indonesia’s Palm Oil Export and CPO Prices

    Exports of Indonesian crude palm oil (CPO) and its derivatives increased 45.8 percent month-on-month (m/m) to 2.47 million metric tons in October 2014 primarily supported by the zero export tariff that was implemented by the Indonesian government per 1 October. Indonesia has a mechanism that when the average CPO price (which is calculated using international and local CPO prices) drop below USD $750 per metric ton, the export tax is scrapped. In early September, Malaysia had already implemented a zero CPO export tax.

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  • Economic Growth of Indonesia Slows to 5.01% y/y in Third Quarter 2014

    Statistics Indonesia announced on Wednesday (05/11) that economic growth in Indonesia reached 5.01 percent year-on-year (y/y) in the third quarter of 2014. This result was slightly below analysts’ forecasts and implies that the slowing trend of economic expansion in Southeast Asia’s largest economy continues. Since 2011, gross domestic product (GDP) growth has been declining amid global and domestic developments. The 5.01 percentage point GDP growth in Q3-2014 was the slowest quarterly growth pace in five years.

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  • Indonesian Palm Oil Companies Post Good Results in 9M-2014

    Indonesian crude palm oil (CPO) producers have released good corporate earnings over the first nine months of 2014. Below, we have presented an overview of those CPO producers, listed on the Indonesia Stock Exchange, that have already released their financial results. Combined, these eleven companies recorded net profit growth of 155.3 percent year-on-year (y/y). The main reason for this improved performance was the 24 percent (average) increase in global CPO prices as the commodity gained popularity as an energy source.

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  • GDP Growth Indonesia Update: What about Economic Growth in Q3-2014?

    Economic growth in Indonesia is expected to continue to slow in the third quarter of 2014 according to the country’s central bank. Bank Indonesia Deputy Governor Perry Warjiyo said on Thursday (30/10) that the institution believes gross domestic product (GDP) growth of Southeast Asia’s largest economy to reach 5.1 percent year-on-year (y/y) in Q3-2014, similar to the GDP growth result in the previous quarter (5.12 percent, y/y). Main reason for this slowing pace is the sluggish global economy and particularly the case of China.

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  • Cocoa Update: Global Price, Harvests in Ivory Coast & Ghana, and Ebola

    Contrary to most other (agricultural) commodities, the global price of cocoa has increased in the second half of 2014. While prices of commodities such as oil, soybeans, corn and wheat have eased due to robust global supply, and others - such as cotton - have eased amid lower global demand, the price of cocoa has been rising steadily. Despite a weak start in 2014, the cocoa price has grown over 10 percent (after having rallied around 25 percent in 2013). Main reason for this performance is the world’s rising cocoa demand.

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  • Indonesia Investments' Newsletter of 26 October 2014 Released

    On 26 October 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic and political topics such as last week's inauguration of Indonesia’s seventh President, economic growth, the impact of slowing GDP growth in China, a palm oil update, new rules in the tobacco industry, and more.

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  • Why did Indonesian Stocks & Rupiah Weaken on Friday?

    Although stock indices on Wall Street were up on Thursday (23/10) on strong corporate earnings (including Caterpillar and 3M) and economic data (US hiring as well as business’ surveys in Europe that suggest the region may avoid slipping back into a recession), it failed to push emerging market stocks higher on Friday (24/10). Indonesia’s benchmark stock index fell 0.60 percent to 5,073.07. Meanwhile, the Indonesian rupiah exchange rate depreciated 0.05 percent to IDR 12,069 per US dollar (Bloomberg Dollar Index).

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Latest Columns China

  • Indonesia's Coal Price Soaring, Reason for Euphoria? Or Not?

    Indonesia's November 2016 coal price broke a record. The nation's benchmark thermal coal price (locally known as the Harga Batubara Acuan, HBA) - a monthly price set by Indonesia's Energy and Mineral Resources Ministry and which is based on domestic and international coal indices - jumped 22.9 percent month-on-month (m/m) to USD $84.89 per metric ton this month, the highest monthly HBA price rise ever recorded. Compared to the start of the year, Indonesia's coal price has now risen 59.6 percent, the sixth straight monthly gain. But is this reason for euphoria?

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  • Financial Market Update Indonesia: What Happened Last Week?

    Many things happened this week. A devastating terror attack in Nice (France) killed at least 84 people, while - at the time of writing - a coup attempt occurred in Turkey (that seems to have failed). However, these events have little impact on the performance of global stocks and currencies (with the obvious exception of the Turkish lira). Wall Street touched record highs, while Indonesian stocks rose to a 13-month high and the Indonesian rupiah strengthened to a four-month high. Lets take a closer look at the performance of these markets over the past week.

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  • Indonesian Companies in Focus: Steel Pipe Industry of Indonesia

    Steel pipe and tube manufacturer Steel Pipe Industry of Indonesia (Spindo), which has the largest steel pipe production capacity among manufacturers in Indonesia, is expected to show solid corporate earnings in the period ahead as the company bought raw materials for its production process when the hot-rolled coil (HRC) price was near its lowest at USD $265 per ton. Investa Saran Mandiri expects that Spindo's earnings will improve markedly starting from the second quarter of 2016 as the HRC price has risen to USD $485 per ton in May 2016.

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  • PBOC Expects GDP Increase, In Spite Of Export Losses

    When we are looking at economic forecasts for potential growth prospects in Indonesia, it makes sense to have an idea of what is happening in the peripheral regions. China is still used as a firm indicator of where we are headed with emerging markets and here we will look at some of the reasons why the People's Bank of China's (PBOC) is still expecting growth even if potentially negative factors occur.

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  • Steel Price Rises but China and Other Steel Producing Nations Divided

    The price of steel has surged 20 percent to USD $365 per ton in April 2016 from USD $305 per ton at the start of the year. The primary reason for the higher steel price is China's plan to curtail the country's installed steel production capacity by a further 150 million tons over the next five years. In recent years the steel price has dropped significantly due to the global oversupply, mainly originating from the chronic steel oversupply in China where domestic demand declined amid the nation's economic slowdown.

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  • Expansion Alibaba to Indonesia to Cause Rising Trade Deficit with China?

    The USD $1 billion acquisition of Southeast Asia-based e-commerce platform Lazada Group SA by China's e-commerce giant Alibaba Group Holding Ltd may give rise to a larger flow of Chinese products into Indonesia. Lazada is an e-commerce platform that operates in Indonesia, Malaysia, the Philippines, Thailand and Vietnam. Southeast Asia is an interesting market for Alibaba as only 3 percent of retail sales are conducted online in this region, implying huge growth opportunities. Meanwhile, Alibaba has been eager to expand abroad as growth in China has been slowing.

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  • International Relations Indonesia-China: Illegal Fishing Case

    Indonesian Minister of Maritime and Fisheries Susi Pudjiastuti said Indonesia could raise the (illegal) fishing dispute between Indonesia and China - that occurred near the Natuna Islands in the South China Sea over the weekend - at the International Tribunal for the Law of the Sea if China's authorities fail to respect Indonesia’s sovereignty over its sea territory. Last Saturday (19/03) a Chinese ship (Kway Fey 10078) was spotted fishing illegally within Indonesia's Exclusive Economic Zone in the South China Sea. Its crew was arrested and ship confiscated. However, two armed Chinese coast guard ships arrived to intervene.

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  • International Monetary Fund (IMF) Sees Indonesia's GDP Growth at 4.9%

    The International Monetary Fund (IMF) expects Indonesia's economy to expand 4.9 percent year-on-year (y/y) in 2016, slightly up from a 4.8 percentage point (y/y) growth of gross domestic product (GDP) in 2015. On Tuesday (15/03) Luis Breuer, IMF Mission Chief for Indonesia, said the Washington-based lender projects limited growth (+0.1 percent) of Indonesia's private consumption this year. Regarding growth of investment and government spending in 2016, the IMF holds a more positive view. On the same day, the World Bank cut its forecast for Indonesia's 2016 GDP growth by 0.2 percent to 5.1 percent.

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  • Business Update Indonesia: BKPM Wants Desk for Chinese Investors

    In order to improve communication and avoid language barriers, the Indonesia Investment Coordinating Board (BKPM) plans to open a special service desk for Chinese investors. BKPM, the investment services agency of the Indonesian government, sees language barriers between Chinese investors and Indonesians as a major obstacle; one that blocks foreign direct investment from China into Indonesia. The new desk, specifically for investment from China or Hong Kong, should improve communication hence improving realization of China's investment plans.

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  • Snapshot of the Indonesian Economy: Risks, Challenges & Development

    Tomorrow (05/02), Statistics Indonesia is scheduled to release Indonesia's official full-year 2015 economic growth figure. Nearly all analysts expect to see a figure that reflects the continuation of slowing economic growth. Southeast Asia's largest economy expanded 5.0 percent in 2014 and this is expected to have eased further to 4.7 percent or 4.8 percent in 2015 on the back of (interrelated) sluggish global growth, low commodity prices, and weak export performance. Domestically, Indonesia has or had to cope with high interest rates and inflation (hence curtailing people's purchasing power and consumption as well as business expansion).

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