Retail News CRM

Author: Mei Ling Tan

  • Indonesian eCommerce boom

    Indonesian eCommerce boom

    Indonesians are embracing online shopping at an astonishing rate.

    The Indonesian eCommerce Association expects the total online market to treble between 2014 and 2016, worth Rp 283 trillion (US$24 billion) in 2016.

    According to Bank Central Asia, Indonesia’s largest private lender, an Indonesian eCommerce boom will see spending rise an estimated 127 per cent this calendar year. And next year, growth will be as high as a further 80 per cent.

    The head of BCA’s consumer card division, Santoso, says the bank recorded Rp 4.5

    trillion (US$326.3 million) in eCommerce transactions in the first nine months of the year and he is confident it will reach Rp 5 trillion by the end of the year. Shoppers are using both credit and debit cards online.

    Despite such figures, the Indonesian eCommerce market remains in relative infancy. Online shopping still accounts for just 0.5 per cent of sales. Consumers are wary of supplying card details online and a mere six per cent of Indonesians actually possess a credit card. Unreliable logistics infrastructure is a further barrier to growth, although this week’s agreement between Zalora and Pos Indonesia to have nearly 3000 of its post offices double as delivery and return points are a step towards addressing that issue.

    Driving the current growth is the small percentage of Indonesia’s affluent consumers – especially those living in second tier cities who lack physical access to branded retail stores or range of products.

    Next week, BCA will hold a three day long e-Shopping Carnival featuring 16 online merchants. It currently works with 420 eCommerce businesses and plans to add a further 150 to those ranks next year, including hotels, travel businesses and electronics vendors.

    Meanwhile, Indonesia’s National Online Shopping Day (Harbolnas) will take place on December 12 with 140 eCommerce sites offering discounts of up to 90 per cent for one day. The online retail event is likened in magnitude to the Jakarta Great Sale.

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  • Geox plans 350 China stores with Hong Kong partner

    Geox plans 350 China stores with Hong Kong partner

    Italian shoemaker Geox has signed a distribution agreement with Hong Kong listed Pou Sheng International to set up 350 stores in Mainland China by 2020.

    The two companies will target China’s rising middle class – 109 million newly affluent, quality-conscious and brand-happy Chinese consumers.

    Geox is one of the leading brands worldwide in the lifestyle footwear market, listed on the  Milan stock exchange and Pou Sheng is one of the leading retailers in China in the lifestyle and sportswear market, retailing brands such as Converse, Rockport and Keds with 4586 retail outlets and another 2691 sub-distributors across China.

    The Geox agreement includes the exclusive distribution of Geox adult collections in China and the opening of 350 new stores in the first five years – including mono brand stores and  shops-in-shops in high end footwear specialist retailers, shopping malls and department stores.

    Mario Moretti Polegato, chairman and founder of Geox, said the strategic agreement is aimed at “developing properly our brand distribution in China where, in our directly operated stores in Shanghai and Beijing, Geox has already demonstrated to have strong potential”.

    “I believe the partnership with Pou Sheng is extremely relevant as it merges the Geox mission of improving everyday life of our endorsers, through our breathable innovations, with a partner whose enlightened mission is providing services and products that promote high quality of living and healthy lives and whose goal is to be the customer’s number one choice and the brand’s best partner in China through the strongest and most innovative multichannel retail network”.

    Geox CEO Giorgio Presca describes China’s emerging middle class as “definitely the best thing” that could have happened to his company.

    “On one hand, the rise of the middle class will boost the economy. On the other, it is the perfect thing for brands like us.”

    Geox is already expecting same-store sales growth in China of 17 per cent or more this year – its highest growth rate globally. But China still comprises just two per cent of its total sales.

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  • Kushikatsu Daruma plans Asian expansion

    Kushikatsu Daruma plans Asian expansion

    An iconic Japanese restaurant chain Kushikatsu Daruma has opened its first outlet outside its home market – and announced plans to enter three more Asian countries.

    Kushikatsu Daruma opened its first restaurant in 1929 at the foot of Tsutenkaku, the famous landmark tower in Shin-Sekai, Osaka. Since then it has expanded to 13 restaurants in Japan and this month it opened its first overseas – in the Taipei of Zhongshan in Taiwan.

    The restaurant was opened by G7 International, the overseas investment arm of G-7 Holdingsfollowing a licence agreement struck last June with Daruma International, a subsidiary of Ichimonkai, parent of Kushikatsu Daruma.

    G7 has the rights to develop the brand overseas and says it is already in talks with Ichimonkai to open restaurants in Vietnam, Malaysia and Indonesia.

    Kushikatsu Daruma Zhongshan Chang’an Store, which opened on Tuesday, has a floor space of about 150 sqm and seats 60 people. It trades from 11.30am to 10pm daily.

    Back in Japan, Kushikatsu Daruma has since become known in the Kansai area for good taste and affordable prices, with customers queuing at opening time every day. It specialises in cooking kushikatsu – skewered and grilled cutlets of meat, fish, vegetables and other ingredients.

    The G-7 Group is a mega franchisee operating Autobacs, Business Supermarket and other franchise stores with about 250 stores in Japan and seven stores abroad.

    “Taking advantage of the G7 Group’s accumulated management know-how and Kushikatsu Daruma priding itself on good taste in general… G7 International will proceed to open more restaurants in Southeast Asia,” the company said in a statement.

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  • Harvey Norman expands with new flagship megastore

    Harvey Norman expands with new flagship megastore

    Australian department store giant Harvey Norman has expanded its presence in Singapore with a new flagship store in the Central Business District despite a downturn in the retail sector that has crippled many operators here.

    The three-storey, 100,000 sq ft superstore, officially opened in Millenia Walk on Thursday, may seem a risky move but chief executive Katie Page shrugged off notions that she may be betting against the market odds.

    “The retail business is competitive all the time, it didn’t just start becoming challenging. We’ve been in this business for 32 years and there is not one year for me that hasn’t been competitive,” she told The Straits Times .

    “You have to keep evolving your business, you have to make it appealing to your customers, give them an experience. You don’t just open a store, not put in the effort like (the flagship store), and expect customers to shop with you.”

    The megastore, which has replaced Harvey Norman’s old 45,000 sq ft outlet in Millenia Walk, is the largest homemaker department store in the CBD.

    The expansion comes at a time when retailer businesses across Singapore are suffering from cut-throat competition, high operating costs and fragile consumer sentiment.

    Well-known brands such as French retailer Carrefour and the Japanese fashion label Lowrys Farm have beaten a retreat from Singapore in recent times.

    The challenge is also evident in Millenia Walk, with Japanese department store Parco shutting its doors in February last year.

    But Ms Page stressed that she has no issue with the location, which was the site for Harvey Norman’s first store in 2001.

    She said the massive floor size is the strategic advantage she has been seeking for years in Singapore.

    “We never had the space for furniture and bedding like we do now, and in Millenia Walk, we have the opportunity to show Singapore what the Harvey Norman brand truly is.

    “So when some retailers say it’s tough for them to do business, I say it’s tough for us that we had not been able to show our full brand like we do in Australia or Malaysia.

    “Having a flagship like this sets the brand, something you can’t do online. You must have the physical space that tells the world what you’re about.”

    Ms Page declined to reveal how much was invested in the new shop, saying only that it was a significant amount for which its return can be achieved “very quickly”.

    “We will know over the next six months where this store really sits within our group in business terms, but I am thinking that this will be as good as our No. 1 store in the world,” she said.

    Harvey Norman, which operates 15 outlets in Singapore, has included some novel features in the shop, including Singapore’s first Fujifilm Wonder Photo Shop and the first Microsoft in-store outlet.

    Ms Page added: “When I sat down with (Millenia Walk owner and) Pontiac Land’s Kwee Liong Phing – a very good friend of mine – about 12 months ago to discuss our plans, we decided for it to be nothing short of the best homemaker department store in the world.

    “This is our largest store in Asia and we want it to be our hub for the region. We’ve got 100,000 sq ft… right in the middle of the city centre. I don’t think you will find that combination anywhere in Asia.”

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  • Ikea to ramp up SEA expansion

    Ikea to ramp up SEA expansion

    Swedish furniture and homewares retailer Ikea wants to ramp up its Southeast Asian store rollout.

    The next two markets in its sights are the Philippines and Vietnam.

    But in some key markets, finding suitable locations for its large format stores is proving a challenge, especially in Vietnam where it wants to launch in Ho Chi Minh City, the country’s commercial capital with a catchment of 8 million consumers.

    Speaking to The Nation newspaper after opening its first pickup point (PUP) in the Thai resort city of Phuket, Mike King, retail manager of Ikea Singapore, Malaysia and Thailand, said the company wants to have three large format stores in Bangkok and five or six PUPs in Thailand within five years.

    In July, the company announced it had located site for its second Bangkok store – adjacent to the new CentralPlaza Westgate shopping mall under construction in Bangyai, in Nonthaburi province in Bangkok’s west. Another site has been earmarked in the city’s north, near the recently expandedFuture Park Rangsit shopping centre.

    Ikea is already actively seeking local partners in Vietnam and the Philippines. Typically when Ikea enters a new market, it locates its initial stores in the most populated cities – for example in Indonesia where it has a joint venture with Hong Kong’s Dairy Farm International, it has opened its first store in Jakarta, and in Malaysia it has two in greater Kuala Lumpur. In the Philippines it will focus on Manila with a population catchment of about 24 million.

    “The two new branches [in Ho Chi Minh City and Manila] will possibly be erected within five years,” King told The Nation.

    Ikea plans to open at least one store a year in Southeast Asia from now on – typically about 40,00 sqm in size.

    Meanwhile, the 2651 sqm Phuket PUP is expected to increase the Bangkok store’s sales by 10 per cent annually. Customers can order online, or in the store and have the products shipped to the PUP for collection.

    It is the first PUP store in Asia, although others operate in Spain, the UAE, Turkey, Norway, Finland and Greece, among other places.

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  • Zalora Indonesia partners with postal service

    Zalora Indonesia partners with postal service

    Zalora Indonesia has signed a distribution agreement with state-owned Pos Indonesia giving its nationwide delivery services a much needed boost.

    “Pos Indonesia is the right partner for us in bringing an easier and complete online shopping experience to our customers,” said Anthony Fung, Zalora Indonesia MD.

    Under the new partnership, Pos Indonesia will expedite returns. Zalora shoppers will be able to take a purchased item back to any of 2943 post offices across the country free within 100 days if they are not satisfied with their purchase.

    “We did this to shape an easy online shopping culture. We give a comprehensive facility, not only in the shipping process,” Fung said.

    Indonesia is Zalora’s biggest market in Asia Pacific, ahead of Singapore, Malaysia, Brunei, Philippines, Thailand, Vietnam and Hong Kong.

    The e-tailer carries some 70,000 items of clothing and accessories, as well as other goods, the majority of stock from local brands.

    Pos Indonesia has 4154 post offices across the country, 24,410 points of sale and 11,835 agents.

  • mCommerce boom raises cybersecurity risk

    mCommerce boom raises cybersecurity risk

    Asia’s mComerce boom is creating a growing target for online fraud and cybersecurity risks, according to fraud consultancy Fico Group.

    Criminals who used to focus on ATM skimming are turning their attention online in an effort to compromise credit and debit card data. These attacks can be far more lucrative, with more details stolen and a lower chance of getting caught, warns Fico.

    “The demographics suggest that this this will soon become a very big data problem.  In the next 15 years, Asia is expected to add another 1 billion internet users, which comes on top of the 700 million it has today, making it the world’s largest market for online consumers.”

    With fraud challenges growing, the issues and technologies needed to address them will be discussed this week in Bali, Indonesia, where Fico will hold its regional Fraud Forum with bank executives from across Asia Pacific.

    The last year alone has seen an average 22 per cent increase in shopping on mobile phones across 13 Asia-Pacific markets, according to a 2015 study from Visa. Indonesia, China and Taiwan reported the highest rates of growth for 2015 at 36 per cent, 34 per cent and 28 per cent respectively.

    With these card-not-present (CNP) transactions, the retailer never sees the customer or their physical card, and the cardholder doesn’t enter their PIN. At last year’s Fico Asia Pacific Fraud Forum in Singapore, 94 per cent of attendees said that cases of online or CNP fraud had increased at their organisation.

    Spotting and finding anomalies in this pool of data requires sophisticated self-learning and adaptive technologies so banks can catch fraud vectors as quickly as criminals exploit them. Fico is currently testing the geolocation abilities of mobile devices and integrating them with the Fico Falcon Platform, which protects 2.5 billion payment cards worldwide. By validating whether a consumer’s phone is in the same place where their card is being used, the system can reduce false positives while focusing on the most likely incidents of fraud. Banks can also send SMS messages to the consumer’s mobile to validate a transaction in real time.

    Maintaining trust in shopping from mobile devices will also require a new approach to cybersecurity. Data breaches at poorly protected retailers can threaten ecommerce sales. Predictive analytics is needed, rather than signature-based solutions, so that so-called “zero day” attacks can be identified and controlled.

    Raed Taji, head of global fraud consulting for Fico in Asia Pacific, said: “We are seeing rapid changes in customer behavior which then open up opportunities for fraud. In Australia, for example, cash withdrawals from ATMs have fallen 20 per cent in three years, thanks to

    tap-and-go card and mobile payment technologies. The focus on online fraud is growing very rapidly, so we must stay nimble to reduce losses.”

    Dan McConaghy, president for Fico in Asia Pacific, added: “Digital disruption to financial services may present fraud challenges, but it also presents opportunities for us to stop criminals. If consumer payments shift toward a new form of payment, fraudsters will seek out the most vulnerable element – which increasingly means a mobile device.

    “By investing in an analytics-based solution, lenders can add a powerful tool to their arsenal to stay ahead of new criminal fraud patterns.”

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  • eGG Optical continues stellar growth

    eGG Optical continues stellar growth

    Hong Kong based fashion eyewear chain eGG Optical Boutique is continuing its stunning growth trajectory.

    According to parent Stelux, the chain’s sales increased by 46.4 per cent to HK$80.5 million in the six months to September 30.

    Its 21 Hong Kong stores have now reached breakeven point and the 34 Mainland China stores cut their operating loss to just $3.3 million. Same store growth in all markets continued to grow.

    A further three stores have recently opened in Southeast Asia.

    Stelux believes the eGG Optical Boutique fast fashion eyewear concept has found favour with shoppers because it captures consumer preference for trendy and fancy optical eyewear.

    In the first half of last financial year the Hong Kong operations lost $500,000 and in the second half $200,000, finishing the year with just 15 stores. That a further six have been opened in the first six months of this year demonstrates the confidence Stelux has in the new brand. Its Hong Kong stores improved sales by 45 per cent due to both network expansion and increasing same store sales.

    In the mainland, eGG Optical’s sales rose 48.8 per cent to $31.0 million.

    “The loss was reduced to $3.3 million owing to significant operating improvements in Northern China and close to breakeven achieved in Southwestern China through turnover growth,” reported Stelux.

    “Combined with eGG’s attractive and eye-catching shop visual merchandising and ability to attract consumer traffic appreciating lifestyle and fashion design, the group will capture the opportunities in the current soft leasing market to further expand into Mainland China.”

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  • Korea scraps perfume tax

    Korea scraps perfume tax

    Korea’s government has removed some items from the Individual Consumption Taxes list, making them exempt from what is often referred to as a ‘luxury tax’.

    Perfume, cameras and deer antlers were removed from the list, but tax will still be imposed on purchases of Royal Jelly.

    Authorities reported that the ruling party and opposition party have agreed on the revision of the Individual Consumption Tax Act.

    The government announced that it would be eliminating the seven per cent tax that was imposed on deer antlers, Royal Jelly and perfume, when it revealed the revised bill in August.

    However, during debate at the national assembly, Royal Jelly was excluded from the exempted items, and cameras, which used to face a 20 per cent tax, were added.

    The bill proposed by governor Jung Eui-hwa suggested that cameras be excluded from the items facing individual consumption taxes. She explained that ‘owning a camera is no longer a symbol of wealth’, and instead it is seen as a matter of ‘consumer preference and choice’.

    Though it was not included in the revised bill that both parties agreed to, the five per cent tax which was imposed on air conditioners, refrigerators, washers and TVs consuming more than the standard amount of electricity is expected to be abolished as the revised act is enforced.

    The revision was undertaken to follow international trends, and recognise the changes that have occurred with the passing of time. It was concluded that the items exempt from taxes were no longer thought of as ‘luxury’ goods in the current society, in which personal income and standard of living are both higher than in the past.

    With the abolishment of individual consumption taxes, the factory prices of deer antlers, cameras and perfume will be lowered. However, some have pointed out that it remains to be seen whether the revision of the bill will lead to lower consumer prices, like the prices of high-fashion brand bags.

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  • FamilyMart Taiwan accepts bitcoins

    FamilyMart Taiwan accepts bitcoins

    FamilyMart Taiwan says a growing number of customers are paying by bitcoin since it struck a deal with local wallet provider BitoEX.

    The convenience retailer started accepting the cryptocurrency at its 3000 stores across Taiwan on October 24 and has recorded more than 500 transactions since then.

    Most customers are using bitcoin to buy coupons dispensed by FamiPort terminals which Taiwanese use to pay for a variety of things including utility bills, cinema tickets, parking fines or train tickets.

    FamilyMart PR manager Chen Chia-Chi told the Taiwanese news agency United Daily News that the bitcoin acceptance is aimed at travellers to Taiwan and a growing domestic bitcoin userbase.

    BitoEX, meanwhile, claims to have more than 40,000 web wallet users, a customer base growing 30 per cent annually.

    “There are more and more users of our bitcoin wallet now, but the market in Taiwan is still small, and it’s still growing,” said Rica Chiang, deputy GM of BitoEX.

    Last year, BitoEX struck a deal with FamilyMart to sell bitcoins. That relationship raised the retailer’s awareness of the currency’s acceptance and consumer interest, leading to October’s payment introduction.

    “Since last year [FamilyMart] saw a growing number of bitcoin sales. That’s why they were cautiously thinking about accepting bitcoin to see if it there’s a bigger market out there,” said Chiang.

    Among the local users of the service are gamers who take a break to grab a refreshment at a familyMart store – and pick up some bitcoins on the way to use online.

    “We noticed a lot of transactions taking place in the middle of the night, so we were curious. We found out they were gamers,” said Chiang.

    “Sometimes they say, ‘Please give me bitcoin, I’m in a hurry – I’m in the middle of a game!’.”

    BitoEX says people using bitcoin for remittances, investors and speculators are its next largest customer groups.

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  • JV plans 20 Pizza Hut Myanmar stores

    JV plans 20 Pizza Hut Myanmar stores

    Hong Kong’s Jardine Group says its Myanmar joint venture will open up to 20 Pizza Hut restaurants across the new market within five years.

    With the first outlet just opened in Yangon, the Jardine CM Restaurant Group plans a second in early 2016 with a gradual expansion thereafter as it tests the market. If sales are high, the rollout may be sped up, according to a company spokesman.

    Jardine CM Restaurant Group is a joint venture between Jardine Restaurant Group Myanmar and City Mart Holding, which owns the Pizza Hut Myanmar franchise.

    Simon Arnold (left), Daw Win Win Tint, UMFCCI chair U Win Aung, Henry Yip and Vipul Chawla (right) hold up pizzas at the launch of Pizza Hut Myanmar.

    Vipul Chawla, MD of Pizza Hut, Asia for parent Yum! Brands, says the company sees huge potential across Asia.

    “Pizza Hut has 25 restaurants for every million people in the US. In Asia we have 11 restaurants per million people. Myanmar has huge potential with a population of more than 50 million,” he said during the opening ceremony for the first restaurant.

    Jardine Restaurant Group operates more than 680 Pizza Hut and KFC restaurants across Vietnam, Taiwan, Hong Kong and Macau.

    Henry Yip, Jardine Restaurant Group CEO, says 97 per cent of the first store’s staff are local and a majority of its ingredients are sourced locally.

    “We are also investing heavily in training and career development to ensure global best practices.”

    Recipes in the restaurant have been tailored to the local palate without removing options which those who have dined in Pizza Huts elsewhere in the world will find familiar.

    “We have researched the tastes preferred by local customers, and tailored our recipes accordingly,” said Simon Arnold, Pizza Hut Myanmar GM.

    Jardine will not be taking KFC into Myanmar – that franchise partnership was secured by Yoma Strategic Holdings, chaired by Serge Pun.

  • American Eagle Outfitters ‘pulls itself out of the mire’

    American Eagle Outfitters ‘pulls itself out of the mire’

    Solid revenue increases at American Eagle Outfitters are evidence the self help measures the company has been employing continue to pay dividends.

    This is especially so as they have been achieved against the backdrop of a teen fashion market that remains subdued and competitive, and during a quarter when the weather was mostly against apparel retailers.

    Key to the transformation of American Eagle Outfitters is a step change in product assortments and in-store execution, especially at American Eagle bannered stores. Compared to a year ago, stores are looking cleaner with a much clearer proposition incorporating a sensible mix of staple and fashion pieces.

    In line with changing tastes, the fashion pieces have more subtle branding and detailing, and many are focused on current trends and ‘must have’ seasonal items like parka jackets. These things, along with a notable step-up in the quality of garments, have helped to improve customer interest and conversion rates. This, in turn, is leading to higher sell-through and lower levels of discounting – something that American Eagle Outfitters was previously guilty of relying on to drive volume.

    These lower levels of promotional activity have helped American Eagle Outfitters to rebuild its profitability, with net income increasing by an impressive 720 per cent this quarter to just over $74 million. Gains to the bottom line were also driven by store rationalisation and improved cost discipline – all things that will continue to deliver gains as the company moves into the final quarter of its fiscal year and beyond.

    The renewed sense of energy and confidence that is present on American Eagle Outfitters’ shop floor is also evident in the boardroom where directors signed off on the acquisition of the Tailgate Clothing Company, which owns and operates Tailgate, a vintage, sports-inspired apparel brand with a college town store concept, and Todd Snyder New York, a premium menswear brand. Both of these businesses are entirely complementary to American Eagle Outfitters in that they have a more premium position and serve a slightly edgier, discerning customer. This is especially so for Todd Snyder which sells sweatpants at $175 and coats for as much as $1995. As niche as this may seem, as the growth of brands like Ted Baker attests, this premium segment of the fashion market is growing rapidly – and we see it as positive that American Eagle Outfitters now has access to this growth.

    Moreover, it is positive that the acquisition is one that has been made on the grounds of giving American Eagle Outfitters access to a different part of the market and has been made at a time when the core business is firmly in recovery. This gives us confidence that the transaction has been made for the right reasons and not simply to hide difficulties in the core business.

    That said, as much as the new businesses provide significant future opportunities, American Eagle Outfitters does need to ensure that its focus remains firmly on the core. Despite its recent success the market in which it operates remains very difficult and is subject to a number of unhelpful competitive dynamics, including the continued growth of fast fashion brands like H&M and Primark. None of this is to suggest that American Eagle Outfitters cannot continue its run of success, merely that it needs to keep both hands on the wheel if it is to steer a successful course.

    This year has been one in which American Eagle Outfitters has managed to pull itself out of the mire. It has emerged as a stronger, leaner player with a much more distinct point of view. We believe that it will build on this progress in the final quarter and beyond. It will do so under the pragmatic and effective leadership of Jay Schottenstein, whose position as interim CEO has now been made permanent.

  • Food will dominate Damansara City Mall

    Food will dominate Damansara City Mall

    A new shopping centre under construction in Malaysia’s capital city, Kuala Lumpur, plans to set itself apart from rival destinations with a dominating food offer.

    The four story Damansara City Mall, scheduled to open in April 2016, has a net lettable area of 17,652 sqm. And a full 75 per cent of that space will be dedicated to food and beverage tenancies. The balance of the space will be for retail and services.

    Damansara City Mall senior manager Christine Yeap told a recent media briefing the mall is being pitched at the 12,000 working population nearby, along with neighbouring communities of Menara Milenium, Damansara Heights and Bangsar – a combined catchment of around 100,000.

    “The location of the mall is a step ahead of other malls with easy accessibility from nearby areas.

    “We have quick-serve food outlets on the lower ground level for the busy, working crowd as well as a range of new restaurants in the market.

    “Coupled with a mix of tenants as well as interesting architecture and interior, the mall creates a comfortable and safe environment for visitors,” she said.

    The new mall is located at Jalan Johar in Damansara Heights, and the developer is Guocoland (M) Bhd, the property arm of Hong Leong Group. It is designed by Blu Water Studios.

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  • Indonesia to Import 1m Tons of Pakistan Rice in New Deal

    Indonesia to Import 1m Tons of Pakistan Rice in New Deal

    Indonesia to Import 1m Tons of Pakistan Rice in New Deal. Pakistan is the world 11th largest rice producer with annual production of 6.9 million tons milled rice.

    Indonesia will import 1 million metric tons of milled rice over the next four years from Pakistan, in a move to shield the country’s food security against volatile weather patterns.

    The two governments, represented by Indonesia’s Trade Minister Thomas Trikasih Lembong and Pakistan’s Ambassador to Indonesia Mohammad Aqil Nadeem, signed a memorandum of understanding on Tuesday.

    The deal, with an estimated worth of $400 million in imports between 2016 and 2019, will be executed by Indonesia’s procurement agency, Bulog, and Pakistan’s Trading Corporation of Pakistan.

    Indonesia currently has similar MoU with Cambodia, Myanmar, Thailand and Vietnam, though only some of the deals have been realized.

    Pakistan is the world 11th largest rice producer with annual production of 6.9 million tons of milled rice.

    The country saw trade with Indonesia rise 27 percent to $2.2 billion last year following a Preferential Trade Agreement in 2013.

    Indonesia enjoyed $1.8 billion surplus in the trade, thanks to its palm oil exports.

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  • Indonesia to Unveil First Local-made Plane after N250

    Indonesia to Unveil First Local-made Plane after N250

    PT Dirgantara Indonesia, (Persero) or PT DI, today will roll-out the N219, the first plane Indonesia has made again after the N250, which was made in 1995.  The N219 is the result of a collaboration between Dirgantara Indonesia and the National Aeronautics Space Agency (Lapan).

    The roll-out—a term for unveiling an airplane for the first time—was supposed to be done in August, but the plane was only ready by November. The roll-out marks that the N219 prototype is ready to be introduced to the public,

    Initially, President Joko Widodo was supposed to attend the unveiling ceremony. But Widodo had canceled his trip to Bandung, where he was supposed to open the 2015 Anti Corruption Festival and the N219 roll-out ceremony.

    Dirgantara Indonesia president director Budi Santoso said that the N219 could mark the beginning of the revival of Indonesia’a aerospace industry.

    “We hope it will help create synergy between industrial sectors and absorb skillful labor,” he said today, December 10.

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