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EIBN is a partnership project between 5 European bilateralchambers of commerce in Indonesia and 2 counterparts inEurope
Initiated and co-funded by the EU
Launched in August 2013
BritCham, EKONID,IFCCI, INA, EuroCham
EUROCHAMBRES CCI Barcelona EEN
Attracting EU businesses into Indonesia and supporting them intheir market entry activities; Increasing EU Business’ leveragetowards the Indonesian Governments.
The projects
Increase and improve export and investment of EU businesses tothe Indonesian market.Objectives
European businesses in Europe, in particular SMEs, with an interestin Indonesian market. Existing European companies in Indonesiawhich need to increase their presence and visibility.
Target group
Joint expertise, knowledge and experience of well-establishedEuropean business support organizations with an extensivenetwork in ASEAN, especially Indonesia and the EU.
Expertise
Availability of more comprehensive information on Indonesian & ASEAN market
More systematic and consolidated business support for companies from all EU28 member
states
Platform for exchange among EU companies increased visibility and leverage towards the
Indonesian and ASEAN governments
Platform for
Knowledge & Information sharing
Best-practiseexchange
Capacity building
EIBN
Infor-mation
Business Support
Pan-European
Thriving on Synergies
Helpdesk Company Directory
Publications Free E-book
• 900 contacts of European and Indonesian companies operating in Indonesia
Events Newsletter
Accessible after registration (free of charge)
World’s Most Populous Country
4th 17,508islandsBiggest Archipelagic Nation
10thWorld’s Largest Economy
I N D O N E S I A
262millionPopulation (in 2017)
G20 Member State after India and
China
3rd fastest growing 3,25 trillionUSD GDP (PPP)
12,378USD GDP per capita (PPP)
Worlds Largest Archipelago
• 3.1 million km2 of sea
• 1.9 million km2 of land
• Hub for international trade since the 7th century
|Agricultural |Construction |Industry2015: 3,77% 2015: 6,36% 2015: 4,33%
2016: 3,25% 2016: 5,22% 2016: 4,29%
|Mining |Transportation |Electricity & Gas2015: -‐3,42% 2015: 6,68% 2015: 0,90%2016: 1,06% 2016: 7,74% 2016:5,39%
|Finance |ICT |Trade
2015: 8,59% 2015: 9,69% 2015: 2,59%
2016: 8,90% 2016: 8,87% 2016: 5,93%
3
Indonesia Macro Economy Condition
|GDP2015: 4,88%
2016: 5,02%
2017: 5,05%
|Investment2015: 5,01%
2016: 4,48%
|Export2015: -‐1,74%
2016: -2,12%
|Import2015: -‐6,41%
2016: -2,27%
Source: BPS 2016,2017
Structure of the Indonesian economy (2016)
Household Consumption Expenditure
56.5%
Non-profit Institution Serving Household
Consumption Expenditure1.16%
Government Consumption Expenditure 9.45%
Gross Domestic Fixed Capital Formation
32.57%
Change in Inventory1.73%
Exports of Goods and Services19.08%
Imports of Goods and Services18.31%
Large domestic consumer
base =
Locomotive and guarantor of GDP growth
… that will grow even further
0
50
100
150
200
250
300
2010 2020 2030
Population development prediction (in million inhabitants)
Consuming class
Below Consumingclass
Consuming class defined as persons with a real net monthly income of US$ 300 or above
135 million people
Macroeconomic data
13
Special Economic Zones& Strategic Tourism Areas
Sei MangkeiPalm Oil, Rubber, Fertilizer Industries,Logistics, Tourism
Tanjung Api-apiPalm Oil, Rubber,
Petrochemical Industries
Tanjung LesungTourism
MandalikaTourism
Maloy BatutaPalm Oil, Coal, Mineral
Industries
BitungFishery & Agro
Industries, Logistics
PaluSmelters,Agro Industry,Logistics
MorotaiTourism, ManufacturingIndustry, Logistics
Padang PariamanAgro Industry (Cacao, Rubber, Palm Oli)
LhoksemaweShipyard,
Manufacture
West JavaManufacture
Batu LicinRefinery,
Metal Industry
TarakanManufacture
GarombongRefinery, Logistic,
Petrochemical Taka BonerateTourism (Maritime)
Teluk BintuniFertilizer, Petrochemical
MeraukeFood, Energy
Raja AmpatTourism (Maritime)
SorongFish industry
Existing SEZs
Planned SEZs
Strategic Tourism Areas
Toba Lake
Kelayang
Thousand Islands
Borobudur
Komodo
Wakatobi
Bromo Tengger Semeru
Infrastructure development - RPJMN (2015 -2019)
Sector Investment
Water supply and waste water treatment 77,7
Energy production and distribution 70,9
Streets 51,0
Maritime traffic 30,2
Public housing 14,9
Rail transport 13,3
ICT-Infrastructure 12,0
Air traffic 9,9
Public transport in cities 6,9
Total 286,6
Planed investment in Indonesia’s (2015 – 2019) (in billion US$*)
225 infrastructure projects as national strategic projects
2 focus sectors: Water and energy
27 priority projects
*) Exchange rate 1 US$ = 13.500 Rupiah (Rp)
Source: Germany Trade and Invest
Project name Investment Explanation
Refinery Development Master Plan 15.500 Modernization of 5 existing refineries
Tuban Refinery 8.000 Construction of new refinery
Bontang Refinery 5.500 - 10.400 Construction of new refinery
PLTU Batang Power Plant 2.960 2.000 MW power plant in Java
High Voltage Direct Current 2.470 742 km electricity transmission grid
500kV Sumatra Transmission 1.810 1.330 km electricity transmission grid
PLTU Mulut Tambang 1.330 1.200 MW power plant in Sumatra
Indramayu Power Plant 1.480 1.000 MW power plant in Java
Central - West Java 500 kV Transmission 570 565 km electricity transmission grid
Water to Energy Not specified 4 hydro power plants with 147 MW in total
Light Rail Transit Jakarta (LRT) 2.540 Tramway in Jakarta
Soekarno-Hatta Airport Express 1.780 Rapid transit to Jakarta Airport
MRT Jakarta 1.850 Construction of subway section
East Kalimantan Railway 1.850 203 km railway
Light Rail Transit (LRT) Sumatra 530 tramway in Palembang
Makassar-Parepare Rail 470 144 km railway in Sulawesi
8 Section of Trans Sumatra Toll Road 6.000 8 sections of the Trans Sumatra motorway
Balikpapan-Samarinda Toll Road 730 99 km motorway in Kalimantan
Manado-Bitung Toll Road 380 39 km motorway in Sulawesi
Serang-Panimbang Toll Road 800 84 km motorway in Banten
Bitung International Hub Seaport 2.520 Sea port in Sulawesi
Kuala Tanjung Seaport 2.220 Sea ports in Sumatra
Inland Waterways Sikarang-Bekasi - Java Sea 250 Canal
National Capital Integrated Coastal Development 44.400 Construction of dam and new district in Jakarta
Jakarta Sewerage System 600 Sewage network
West Semarang Drinking Water Supply System 90 Drinking water network
Refineries
Energy
Railway
Street
Ports
Water
(in Mio. US$) Source: Germany Trade and Invest
• Since 1998 thriving and stable democracy
• Newly elected President: Joko Widodo
Joko WidodoGovernor of Jakarta 2012 – 2014President 2014-2019
Stable Political environment
Political Party 34%
Professional66%
CABINET
FOOD & BEVERAGEIndonesia’s growing middle class and high-income group have represented an increasingly discerning and
demanding consumer base, eager to try new and innovative food and beverages products
The F&B sector’s output has contributed 7% of total GDP, as well as 32.84% of the total industrial
manufacturing output .
The solid growth of F&B sector is supported by Indonesia's improving purchasing power amid the
accelerating economy and higher commodity prices, and growing output of the nation's processed
food and beverage industry.
The turnover of the F&B industry has been growing 8.46% in 2016.
Indonesia is one of the largest producers of, for palm oil, fish, cocoa and coffee, exporting its productionsurpluses abroad. On the other hand, Indonesia relies on imports of products that cannot be produced(either at all or in sufficient quantity) locally, such as wheat, dairy or processed food products.
Tourism industry has raised 124% growth in Foreign Direct Investment from 2013-
2016. It contributed 4.23% of total Indonesian investment in 2015 and it is Projected
to rise by 8% in 2019.It has became one of the trigger for the development of HORECA Business
Sou
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The mass grocery retail value sales’ grow at more than
10% per year (outlet shift to modern markets).
In 2013, Indonesia has around 590 shopping malls.
While Jakarta contribute 173 shopping malls
And the number increased 3.9%per year.
145000
58740
51425
24060
34060
0
20000
40000
60000
80000
100000
120000
140000
160000
Prepared Food and Beverages Cereals Cigarettes Eggs and Milk Fish/Shrimp/Common Squid
Top 5 of Monthly Food Expenditure per Capita (in IDR)
The monthly expenditure per capita in F&B averaged to
approximately 51%.
The Food & Beverage sector is estimated to encompass over 6,000 companies, of which approximately 90% are classified as large or medium sized. The players are dominated by the
presence of large local companies, but also important international and foreign companies
5248
5463
5662
5852
328
335
345
348
0 1000 2000 3000 4000 5000 6000 7000
2010
2011
2012
2013
Number of Large and Medium companies in F&B Manufacturing
Beverage Food
Among the leading packaged food players in Indonesia, Indofood, Nestle Indonesia, Heinz ABC Indonesia and Unilever Indonesia has the strongest market share. In beverage, Danone
Aqua held on firmly to its leadership within soft drinks with 47.5% of market share
Packaged Food Breakdown Non-Alcoholic Beverage Breakdown
Source: Roy Morgan Research, 2012Source: USDA, Economic Research Service Calculations using EuroMonitor Data, 2012
Highest business potentials: halal products, branded and specialty food & beverages products, food processing machinery, supply of food ingredients and packaging.
Top commodities sourced from the EU are dairy products, prepared food, vegetable oilsand chocolate and cocoa products. For some commodities, trade with the EU accounts formore than 20% of total imports (e.g. wine and beer, dairy products, vegetable oils)
Alcoholic Beverage
Category Classifications Type
AAlcoholic beverage with 1-5% ethanol
(C2H5OH) content
Beer, Lager, Ale, Stout, Low Alcohol Wine, Carbonated Alcoholic
Beverage, Glutinous Rice Wine (Brem)
B
Alcoholic beverage with 5-20% ethanol
(C2H5OH) content
Wine, Sparkling Wine, Champagne, Carbonated Wine, Reduced Alcohol
Wine, Cocktail Wine, Quinine Tonic Wine, Meat Wine or Beef Wine, Malt
Wine, Fruit Wine, Cider, Perry,
Rice Wine, Vegetable Wine, Honey Wine (Mead), Palm Wine/Toddy,
Aromatic Alcoholic Beverage, Rice Wine with Greater Galingale (Beras
Kencur), and Ginseng Wine
C
Alcoholic beverage with 20-55% ethanol
(C2H5OH) content
Brandy, Fruit Brandy, Gin/Genever, Liquor, Rum, Vodka, Whiskey, Samsu
Alcohol (Spirit)
The Minister of Trade Decree No: 15/M-DAG/PER/3/2006, March 29, 2006
Indonesians perceive wine as a healthier alternative than other alcoholic beverages.
Between 2005 and 2011, the consumption of wine in Indonesia increased by an annual average of 25% with a demand very much driven by
the upper-income local population, but as well by the expatriate and tourist communities. The industry predicts a similar trend for 2014
and 2015 with an estimated annual growth of 20%.
HEALTHCARE• The National Health Insurance program (launched in January 2014) will generate demand in a
new population group, by providing access amongst those that never could have afforded itbefore, driving an increasing demand for clinics, hospitals and clinicians.
• Indonesians spending on healthcare is expected to grow close to 14%
• Indonesia has the faster growth rate in Asia private hospital sector, the number of privatehospitals has grown by 59.92% in the periods of January 2012 though April 2015. in the otherside, the number of public hospitals has increased by 14.78%.
• Hospital beds, medical devices, diagnostic tests, IT systems and skilled manpower demand willsteeply raise.
• Opportunities: Medical & Surgical devices (dental equipment, medical equipment, laboratoryequipment); Health IT; Health infrastructure; Food and health supplements; Householdhealthcare devices; Islamic medicines.
Medical Devices
In 2013, It is estimated that 97.2% of medical apparatus in Indonesia is imported
Less than 3% Local Producers: furniture, tensimeter, wheelchair, dental chair, hospital billing system, etc
Further, Diagnostic imaging hardware and orthopedic implants are the quickest developing items in the market
The medical device market is estimated to grow from US$ 2.2 billion in 2016 to US$ 3.5 billion in 2019, at a Growth Rate (CAGR) of 23.87%.
Medical Devices
Regulation, Standard, Tax
SNI for 62 products
6 months process, which
cost around 100 to 250 Euros
License valid for 4 years and renewable
Obligation to have local distributor
E-Registration from January
2015
Import tax max.30% and
10% VAT
Hospitals & Puskesmas
• The private sector represents almost 40% of total hospitals in Indonesia and continued growth
• The growth rate of hospitals is 12.95%.
• 9.599 Puskesmas across Indonesia, only 18.6% have obsetric neonatal facilities
• Currently there are 1061 hospitals working wiith BPJS Kesehatan
Category Owner General Hospital Specialized Hospital Total
Public Government 824 86 910
Private
Private non Profit 541 162 703
Private 624 301 925
State-owned enterprise 56 7 63
TOTAL 2.045 556 2.601
Name of the HospitalNumber of
Competing HospitalsEstimated Number
of Beds
Siloam Hospital Group (SILO) 14 3,000
Mitra Keluarga Group 10 1,200
Awal Bros Group 7 1,000
Sari Asih Group 6 900
Ramsay Sime Darby Health Care 3 650
41 6,750
TOP 5 Private Hospital Groups
Regional competitors from Singapore and Penang: - Mount Elizabeth Hospital- Gleneagles Hospital- Penang Adventist Hospital
SILOAM HospitalInvestment Plan 2,5 Md USD
14 existing hospital20 new projects
Objectives to have 50 hospitals by 2016 and has an advance HIS
Mitra Keluarga Group
Investment Plan 2,5 Milliards USD , where 1/3 of their budget is for medical equipment by 2020.
Ciputra Hospital
3 hospital under construction
10 hospitals by 2018
E-Health The Minister of Health Regulation No. 1171/2011 on Hospital Information Systems,37 requires all hospitals toimplement a Hospital Information System (HIS) or Enterprise Resource Planning (ERP) system. However, many pubichospitals and even some private-owned hospitals have until now used solely traditional systems for administrationprocesses and management
Other technology strains that are likely to gain momentum in the short-term are Mobile Health and Telehealth.
Waiting Lists and Booking Systems
Key Factors and Major
Trends
Universal Healthcare Programme
Jakarta Online Referral System
Indonesia Broadband
Plan
National Phone
Referral System
Integrated National Data
Repository System
Healthcare IT Solutions
Indonesia is the fastest growing mobile telephone market in the Asia-Pacific region, predicted to reach 391
million mobile accounts in 2015. The market is dominated by three major mobile telecommunication providers,
Telkomsel, Indosat and Xl Axiata; 95% of mobile users are prepaid subscribers.
Construction
Current value of retail industry = $326bn
10% annual growth
5th on Global Retail Development Index
419,000sqm of retail projects scheduled
Hotel construction value = $1.5bn
Consistent double-digit growth
Currently over 200,000 keys
15,000+ more rooms planned
25,000+ new apartment units planned in Jakarta
Jakarta constructing 500,000sqm office space
annually between 2015-2018
12.5% YoY increase in office space
22,000 completed apartment units in Jakarta in 2016
CLEANTECH
Renewable energy
Waste Management
Green Building
Non-fossil energy Resources (sd) Installed
capacity (kt)
Ratio kt/sd
Hydro75,670 MW 6,848.46 MW 9.05%
Geothermal 29,164 MW 1,341 MW 4,6%
Mini/Micro Hydro 769.69 MW 230 MW 29.9%
Biomass 49,810 MW 1,644.1 MW 3,3%
Solar Energy 4.80 kWh/m2/day 27.23 MW -
Wind Energy 3 – 6 m/s 2.731 MW -
Ocean 49 GW 0.01 MW 0%
Uranium 3000 MW 30 MW 0%
Three biggest priorities: Biomass, Geothermal and Solar PV
National commitmentto reduce carbon emissions by 26% in 2020
• Private companies that offer design “build-operate-transfer” contract(BOT) and turn key solutions are more likely to succeed in the Indonesianmarket.
• Key arrangements: guarantee agreement with the local governmentwhere the landfill is located on waste supply to the facility for the securityof the investors, and a Power Purchase Agreement (PPA) with the state-owned electricity company, PT PLN.
• Growing urban population and increase of people life-style standards rapid construction growth: 7-8%
• Only one pilot green building code applied in Greater Jakarta, more cities are developing to the same goal.
• The highest potential: energy efficiency, water efficiency, indoor air quality, land and waste management
Business opportunitiesRecommended roles for European businesses
• As suppliers
– Technological advanced inputs such as security technology, energy efficient building technology or traffic engineering
– Construction machinery such as excavators or cranes
– Materials such as cement are sufficiently and cheaply produced in Indonesia
• As subcontractors
– Planning (e.g. feasibility and design studies)
– Certification
– Energy efficient building Advantage: European technology has a better reputation than the one
provided by cheaper competitors
Greatest opportunities in the sector of high quality building of all types (hotels, offices, apartments, retail) due to comparative advantage of high quality.
Steps to Market Entry in Indonesia
Visit the Indonesian market yourself
Export products working with local business partners
Appoint an agent to explore the market
Establish a company having in mind your planned business aims
Manufacture in Free Trade Zones in Indonesia
ProgramDay 1: Information Session with local market players and
related institutions Arrange your visits to local market players,
government, associations, trade fairs and other relevant networking events
Day 2 and Day 3: Arrange B2B meetings with your potential partners in
Indonesia and relevant government departments
= Saving your time + successful trade mission
Medical Trade Mission (23rd – 25th April 2018)
EIBN will provide you:
an overview of Indonesian Market Report Delegation booklet contents your company
information and distribute it to potential partners