Tremendous opportunities in Indonesia’s infrastructure sector
Indonesia's large population and strong domestic demand is contributing to its positive growth outlook. With a population of 250 million, over 50% of whom live in urban areas, Indonesia has a large domestic market. And, a growing and affluent middle class supports GDP growth, where approximately 60% of GDP is derived from private consumption.
Infrastructure is a strong platform to support and sustain economic growth in Indonesia
Underpinning this positive outlook is the Government of Indonesia's pledge to improve infrastructure development. There is a significant need for infrastructure investment in roads, toll roads, ports, airports railways, water, and power plants. The Jokowi administration's plan for 2015-2019 increases infrastructure funding compared to the previous period by nearly US 10 billion dollars a year. Priority projects include the revitalization of 10 airports, a number of thermal and hydropower plants, toll roads, Mass Rapid Transit and the construction of new and upgrading of existing ports.
PwC's latest Capital project and infrastructure: Outlook to 2025 report has forecast that total infrastructure spending in Indonesia will rise from US$76 billion in 2015 to US$139 billion in 2025. Particularly fast growing sectors will include health and education, road, rail, and power generation/transmission. However, all sectors will grow substantially in dollar terms, including transport and energy more broadly.
The Government of Indonesia expects that between 2015 and 2019 the private sector will need to contribute around 30% of total funding. Many projects will therefore be offered under Public Private Partnership (“PPP”) arrangements.
If successful, this could kick-start a virtuous circle of improved infrastructure and faster economic growth.
EXHIBIT AT INDOMETAL 2020 TO:
- Launch new products for the first time
- Showcase the latest in technological innovations
- Demonstrate cutting-edge machinery
- Engage key decision makers and high net worth buyers
- Achieve on-site sales and procurement orders
- Tap on the burgeoning metal & steel market in Southeast Asia
indometal is one of the platforms we have identified, that would support our business diversification objectives. The exhibition is fantastic; we got to talk to potential customers and received interesting queries from them. We realised that many people did not know that we are actually manufacturers of wheel blast machines, and we do abrasives manufacturing, so to me, we are creating quite a bit of awareness through this exhibition. We have certainly we have met our objectives!
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