More than a year ago, Indonesia was dubbed as one of the ‘fragile five’ emerging markets (EMs), fuelling concerns in the international investor community, aggravated further in view of the looming political uncertainty and sharp fluctuations in currency values. Nevertheless, the country’s long-term growth potential continues to attract global investors and the confidence has been largely restored with the welcome change in Jokowi taking charge as Indonesia’s new President.
Japanese investors, in particular, rank Indonesia as their top investment destination in the world, not only in view of their long-standing presence in the archipelago but also given its vast population, increasing GDP levels, and a rapidly expanding middle class with increasing disposable incomes.
The positive sentiment in view of increasing GDP per capita has triggered creation of more diversified investment portfolios for Japanese investors, not only in traditional automotive, electronic goods or mining sectors, but also in FMCG and retail sectors. The trend is evident from Japanese brands gaining popularity as restaurant chains, convenience stores (minimarkets) and large departmental stores. However, the investor community also needs to be watchful of the rising competition from South Korean and even Chinese rivals, which have already created a strong foothold in Indonesia’s consumer electronic goods market.
Nevertheless, the country’s rapidly middle class and increasing consumer appetite spell significant opportunities for Japanese investors. MarkPlus Insight’s latest whitepaper provides a detailed analysis on the potential opportunities for Japanese investors keen in entering or strengthening existing market presence in Indonesia. It also gives a sneak peek into the emerging youth-women-netizen subcultures in Indonesia’s middle class, which will be the most significant drivers of domestic consumption – Indonesia’s new economic growth engine.