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Management consultants at McKinsey say the Indonesian middle class consists of 45m people, while their rivals at Boston Consulting Group cite a figure of 74m. The Asian Development Bank puts it at an eye-popping 146m, or 59 per cent of the population.

Either way, investors are whetting their appetites at the prospect of selling their goods and services into this undoubtedly large and fast-growing market of consumers. Continue reading »

While the “quick count” results from Wednesday’s five-yearly legislative election are only preliminary, it seems clear that the Indonesian Democratic Party-Struggle (PDI-P) has failed to fully capitalise on the popularity of its presidential candidate, Joko Widodo.

Having named Widodo, the highly regarded Jakarta governor, as its presidential candidate in March, PDI-P was targeting at least 27 per cent of the vote for the 560-member House of Representatives (DPR). But initial results showed that it secured 19 per cent, in spite of coming first.

 Continue reading »

There is no doubt that emerging market (EM) investors have cheered up considerably of late. Following a torrid January and February, virtually all asset classes in the EM universe appear – on aggregate at least – to be gaining in value.

The bellwether stock index, the MSCI EM index, is up 9.6 per cent from its low on February 5. EM sovereign bonds are yielding an average of 5.51 per cent, down 0.37 per cent since January 1. Local currency bonds are, in many cases, producing stellar returns sharpened by windfall currency gains. Indeed, some EM currencies are among the world’s best performers, with the Indonesian rupiah rising 7.81 per cent, the Brazilian real gaining 7.3 per cent and the Indian rupee climbing 2.8 per cent so far this year. Continue reading »

Indonesia is facing a colossal task to organise what is perhaps the world’s most complicated single-day election, as the FT reports on Wednesday.

Here are six major quirks of the idiosyncratic Indonesian electoral system. Continue reading »

“Hot celebs assault on parliament,” reads the headline of a local tabloid in a photograph that Destiya Purna Panca has uploaded to Instagram.

The 25-year-old swimsuit model – better known as Destiara Talita – was one of the two celebrities pictured on the front page. The other was 28-year-old Camellia Panduwinata Lubis – or Camel Petir – a popular singer of Indonesia’s hip-shaking dangdut music.

Both are candidates in the April 9 elections for the small Indonesian Justice and Unity Party and high-profile examples of the caleg cantik or “beautiful legislative candidate” trend. Continue reading »

With Indonesia’s parliament and political parties having earned a popular reputation for corruption, waste and venality, many voters are uninspired by April 9’s legislative elections.

But amid the party hacks, elite offspring and celebrities standing for election, there is a crop of first-time parliamentary candidates who are promising to be clean, effective and responsive.

Young, professional and social media-savvy, they are targeting some of the 50m plus voters under 30 years of age (out of an electorate of 186m), with 21.8m of them first time voters. To give an insight into the strengths, weakness and quirks of the Indonesian electoral system, beyondbrics will be tracking the progress of one such candidate, Taufik Basari. Continue reading »

By Jeffrey Winters of Northwestern University

Indonesia’s political parties are not bottom-up institutions. They are more like a conical lamp over a billiard table: intense and bright at the narrow top, faint and dim towards the bottom. Ever since the Communist Party was butchered in the mid-1960s, no Indonesian party has been interested in arousing passions among the citizenry or engaging them in politics. Continue reading »

By helicopter, by jeep and on horseback, former special forces general Prabowo Subianto came storming into a rally at Jakarta’s main stadium on Sunday in a bid to revitalise his ailing campaign for Indonesia’s presidency. Continue reading »

While Joko Widodo, the wildly popular governor of Jakarta, just about managed to restrain his euphoria when he was finally named as his party’s presidential candidate on Friday, investors were not so coy.

The Jakarta stock exchange jumped by three percent on Friday, its biggest one-day gain for six months, to reach a nine-month high, while the once-troubled rupiah has strengthened by 1.3 per cent against the US dollar since then. Continue reading »

Indonesian GDP came in higher than expected in Q4, up 5.7 per cent year-on-year in the quarter, above the average forecast of 5.3 per cent, as improving exports reduced the impact of slowing growth in domestic consumption and investment.

The full FT story is here. Beyondbrics presents a rundown of the analysts’ viewpoints (with our emphasis in bold). Continue reading »

Source: HSBC / Markit

The monthly temperature-taking of Asian manufacturing, aka the purchasing managers index, is out for some of Asia’s bigger economies – and at first glance, things look good.

China may have seen its HSBC/Markit (in contrast to the official government) index fall below the 50 mark that separates contraction from expansion, but India, Indonesia and South Korea all look in good shape.

Or do they? Continue reading »

As emerging markets remain rattled by investor jitters, Raghuram Rajan, India’s central bank governor, has resurrected a gripe of old by attacking the US for its lack of concern about the global impact of its withdrawal of extraordinary monetary stimulus.

Mr Rajan, a former chief economist for the International Monetary Fund, told Bloomberg India TV that “international monetary co-operation has broken down.”

“Industrial countries have to play a part in restoring that [co-operation], and they can’t at this point wash their hands off and say, we’ll do what we need to and you do the adjustment.” Continue reading »

If you are doing business in Asean – the Association of Southeast Asian Nations – be prepared for an electric shock.

Analysts at ANZ have looked at what’s happening with electricity prices across the region and are warning that they are set to rise, making it considerably more expensive to run factories. It will also add half a basis point on average to inflation, which is already inching up. Continue reading »

Indonesia’s powerful corruption commission has a new target. Having gone for members of the president’s inner circle, the country’s highest judge and dozens of parliamentarians, the Corruption Eradication Commission (KPK) now has the lucrative mining industry in its sights.

Adnan Pandu Praja, a deputy chairman of the KPK, told the Jakarta Foreign Correspondents Club on Wednesday that the agency was launching a crackdown on corrupt mining companies and some of the government officials, military officers and police who stand behind them. Continue reading »

As you’d expect, Indonesia’s new restrictions on raw-mineral exports have gone down badly overseas. US mining majors Newmont and Freeport have decried the sliding scale of increasingly tough taxes, arguing that their original contracts of works to dig up copper and gold should shield them from subsequent law changes.

The Japanese nickel industry is upset, too. Unlike copper, iron ore, lead and zinc, where miners were given a few years to phase out exports, shipments of nickel ore were cut altogether as of 12 January. Continue reading »