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Tag: Indonesia

  • Report predicts $25b in eCommerce revenues

    Report predicts $25b in eCommerce revenues

    Southeast Asia eCommerce revenues are projected to exceed US$25 billion by 2020, according to new research by growth partnership company Frost & Sullivan.

    Despite acquisitions, market exits and many online retailers struggling to achieve profitability, the market earned $11 billion last year, says the report, from its Telecommunications and Digital Services program, Analysis of the Southeast Asian E-commerce Market. The study examines market trends and opportunities in six key Southeast Asian markets – Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

    Key findings include continuing rapid growth as the industry evolves.

    Total revenues from business-to-consumer (B2C) eCommerce in the six markets will increase at a compound annual growth rate of 17.7 per cent.

    Malaysia and Thailand were the largest eCommerce markets in the region last year, generating revenues of $2.3 billion and $2.1 billion respectively. But by 2020, both these markets are expected to be eclipsed by such emerging economies as Indonesia and Vietnam.

    “Despite being relatively young, the eCommerce market in Southeast Asia is developing quickly, thanks to an astounding rate of digital adoption,” says Frost & Sullivan Asia-Pacific lead consultant for eCommerce and digital transformation, Cris Duy Tran.

    “However, companies pursuing an Amazon-style B2C mass-market business model are struggling to turn a profit, and there have been several mergers and acquisitions and market exits,” he says.

    “With fewer players in the market, eCommerce players are beginning to compete beyond price points and logistics, and are moving into new areas such as Online-to-Offline (O2O) eCommerce and loyalty programs.”

    Although the mass-marketing approach has not worked so far in Southeast Asia, he says there are many exciting opportunities in specialized eCommerce and peer-to-peer (P2P) eCommerce. Services such as Carousell, Shopee and Tokopedia are aggressively pursuing a “mobile first” strategy, and Frost & Sullivan expects to see more sector-specific services in areas such as travel, food delivery and luxury goods.

    Challenges

    While the opportunities for growth are immense, says the report, the eCommerce market in Southeast Asia is not without challenges.

    Several key factors that inhibit growth have been identified, including low credit-card ownership – less than 7 per cent of the population in all Southeast Asian markets except for Malaysia and Singapore. In some countries, more than half of the population does not have a bank account, making payment the biggest challenge for eCommerce companies.

    Logistics is another issue hampering eCommerce growth, especially in areas with complex geographies such as Indonesia and the Philippines. However, recent investments by regional logistics players such as aCommerce and SingPost have strengthened eCommerce logistics infrastructure in these markets.

    China’s rapid expansion in eCommerce is providing further impetus for online retail growth in Southeast Asia, says the report.

    “The eCommerce revenue in China represented 12.1 per cent of all retail sales last year, surpassing the US, Europe and Japan,” says Tran. “Given the massive adoption of eCommerce in China, Southeast Asia is set to follow a similar upward trajectory, even though eCommerce now represents less than 2.5 per cent of all retail sales.”

    With more mergers and acquisitions likely during the forecast period, more exciting market developments can be expected in the near future, says Tran.

  • Pizza Hut, Japanese franchise used expired ingredients in Indonesia

    Pizza Hut, Japanese franchise used expired ingredients in Indonesia

    A joint investigation by Tempo, a weekly news magazine, and BBC Indonesia has reportedly revealed the use of expired ingredients by fast food chain Pizza Hut, its delivery arm Pizza Hut Delivery (PHD), and Japanese franchise Marugame Udon.

    The investigation, according to the reports, show evidence of Indonesian firms Sarimelati Kencana and Sriboga Marugame Indonesia – both subsidiaries of major flour producer Sriboga Raturaya – extending the expiry date on their ingredients, and using them in the food. This practice, according to reports, happened systematically, involved top management, and carried on for years.

    Some of these ingredients include: “Veggie Chicken Sausage”, a “Carbonara Sauce Mix”, “Citrus Marinade”, and “Satay Sauce”, among several others. Photographic evidence reportedly shows a sticker on a packet of “Bonito powder” with instructions to use it for up to a period of three months after expiry. The instructions were said to be relayed via email by the purchasing department.

    Both Sarimelati Kencana – which manages Pizza Hut and PHD in Indonesia – and Sriboga Marugame Indonesia – which manages Marugame Udon – issued statements on Sunday (Sep 4) denying the allegations, saying they only used food ingredients “of high quality” which were “suitable for consumption.”

    Meanwhile, Stephen McCartney, president director of Sarimelati Kencana, told local media in a press conference that the company that the company never made a profit “by compromising on food safety.” Alwin Arifin, president director of Siboga Raturaya, said the allegations were defamatory.

    The matter is currently under investigation by police. Besides Yum! Brands and Japan’s Toridoll Corporation which owns Marugame Udon, Sriboga Raturaya is also a local partner for Nissin and Mitsubishi.

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  • Blackmores, Kalbe join forces in new Indonesian venture

    Blackmores, Kalbe join forces in new Indonesian venture

    Australian Ambassador to Indonesia Paul Grigson has welcomed the new partnership between Australian company Blackmores and Indonesias Kalbe that will allow new vitamin products to enter the local market.

    Blackmores will initially supply eight products in Indonesia through the joint venture, the Australian Embassy here said on its official website on Saturday (Sept. 3).

    Ambassador Grigson said while the two companies shared many values, it was the small differences between them that had generated the creativity needed for such a partnership.

    “Blackmores experience shows the importance of Australian companies choosing the right local partner to do business in Indonesia,” Ambassador Grigson added.

    The Blackmores – Kalbe partnership was sealed during Indonesia Australia Business Week in November 2015, when 360 Australian businesses travelled to Indonesia to build collaborative partnerships with Indonesian companies and explore investment opportunities.

    Blackmores CEO Christine Holgate has thanked the Indonesian Government and Australian Embassy for their support in finalizing the partnership.

    “We will be launching with eight products and will have 25 products by the end of the year,” Holgate informed.

    She explained that Blackmores had chosen to partner with Kalbe as it was a major supplier of pharmaceutical products and has an institute to train people in natural health care products.

    She hoped that Blackmores would be able to leverage Kalbes training processes and its strong representation in shopping centers throughout Indonesia where it has health centers giving advice on natural health products.

  • Indonesia to host Forbes conference

    Indonesia to host Forbes conference

    Indonesia is set to host the Forbes Global CEO Conference for a second time. The gathering will see business players and thought leaders from around the world discuss possible solutions to the continuous global economic slump.

    Now in its 16th year, the conference will host at least 42 speakers and has received confirmation from 300 delegates who have been invited to come to the conference in Jakarta, a change of pace from the 2013 conference held in Bali.

    Forbes Media chairman and chief editor Malcolm Stevenson “Steve” Forbes, Jr. said that Jakarta was chosen to host this year’s conference due to its continued growth even during the global economic slowdown.

    The country’s sheer size and President Joko “Jokowi” Widodo’s efforts to establish economic reforms have caught the eye of business players from across the globe.

    “Even though it’s facing some economic challenges with the collapse of commodity prices, Indonesia is still achieving higher growth rates than many of its neighbors. You have a president who is determined to make major economic reforms to unleash the potential of the Indonesian economy,” he told on Friday.

    President Joko “Jokowi” Widodo has pushed for economic reforms and has issued 13 economic stimulus packages that aim to increase investment and nurture growth.

    The economy grew 5.2 percent year-on-year (yoy) in the second quarter, beating average estimates of 5 percent from economists and Bank Indonesia’s (BI) forecast of 4.9 percent.

    The growth domestic product (GDP) growth rate was higher than the 4.9 percent yoy reported in the first quarter and the 4.7 percent posted in the second quarter of 2015.

    With the second quarter result, the economy has so far expanded by 5.04 percent this year.

    However, despite positive-looking growth, experts have predicted that the official 5.2 percent growth target for the whole year may still be unattainable as the second quarter’s performance was largely due to a surge in consumption and production during the Ramadhan and Idul Fitri festivities, a trend that typically happens every year.

    Meanwhile, not much is happening on the global stage. The World Bank has forecast that global growth will only reach 2.4 percent by the end of the year.

    “So you look around the world and business leaders, whether with established companies or start-ups, they face very real headwinds,” Forbes said.

    Mayapada Group owner Dato’ Sri Tahir said the conference was an important event to show off the economic reforms that Indonesia had made to cut costs and create a conducive investment environment.

    “Through this platform, the President can explain to these 300 and more delegates about Indonesia’s future. This platform is
    important to introduce Indonesia to the world and the world to Indonesia,” he said.

    Mayapada Group is one of the sponsors of this year’s conference.

    The conference, themed “Rising to the Challenge”, will feature distinguished Indonesian and international speakers.

    They include Investment Coordinating Board (BKPM) chairman Thomas Lembong, CT Corp. chairman Chairul Tanjung, AirAsia Group chief Tony Fernandes and Ayala Corporation chairman and CEO Jaime Augusto Zobel de Ayala.

    The conference will be held from Nov. 29 to Dec. 1.

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  • Indonesia encourages direct trade with Cuba

    Indonesia encourages direct trade with Cuba

    The Indonesian government will encourage direct trade contact with Cuba to increase the value of the two countries bilateral trade, Indonesian Deputy Foreign Minister A.M. Fachir has said.

    “Indonesia will encourage direct trade contact with Cuba in order to increase the volume of bilateral trade between the two countries and appreciate the significant economic development in Cuba,” Fachir said here over the weekend.

    The deputy foreign minister made the remarks in connection with his meeting earlier with Cuban Director General for Bilateral Relations Affairs of the Foreign Ministry of Cuba, Ambassador Gerardo Penalver Portal.

    During the meeting, Fachir discussed various issues of mutual concerns, both, at bilateral and multilateral forums.

    “On the bilateral basis, the political relations of the two countries had been closely established. Yet this closeness should be translated into a concrete form of cooperation, among others in the fields of trade, health and agriculture,” he said.

    In the multilateral context, Indonesia and Cuba shared similarities in views and cooperation regarding various international issues, the deputy foreign minister said.

    “In the bilateral aspect, Cuba pays attention to direct trade contact to increase trade relations by among others planning a Cuban trade mission to Indonesia and that of Indonesia to Cuba,” Fachir said.

    Meanwhile, Gerardo Penalver Portal expressed appreciation for the establishment of good cooperation between the two countries at various international forums.

    Cuba appreciates Indonesias big contributions to the Non-Aligned Movement so that the movement remains relevant to the present conditions, he said.

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  • Indonesia to export chicken due to overproduction

    Indonesia to export chicken due to overproduction

    Indonesia will soon export chicken as production has doubled, Agriculture Minister Amran Sulaiman said.

    “Right now, we are campaigning for self-reliance in protein which is found in abundance in our husbandry and fishery commodities,” he stated here on Saturday.

    Amran Sulaiman, along with Chief of the Business Competition Supervisory Commission (KPPU) Syarkawi Rauf and Deputy Chairman of the House Commission IV Viva Yoga, was in Makassar to address a workshop, titled, “Developing Husbandry Industry in Pursuit of Self Reliance in Animal Protein.”

    The minister underscored the importance of maintaining food stocks in support of the country self-reliance.

    The Agriculture Ministry has made various breakthroughs and innovations along with other parties to support the governments program to achieve self-reliance in food production, thus adding to national resilience, he added.

    He believed that Indonesia would achieve the goal of self-reliance in animal protein by the time the country celebrates the 100th anniversary of its independence.

    Livestock and marine products have already helped achieve self-reliance in animal protein, he reminded.

    “We have changed our policy so that we are no longer self-reliance in meat but are self-reliance in protein. In fact, we have exported chicken to Vietnam and Japan,” he noted.

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  • Alfamart sales strengthen

    Alfamart sales strengthen

    Indonesia’s Alfamart has reported a healthy first half year’s performance.

    Alfamart sales rose by 21.5 per cent to IDR36,870 billion (US$2 billion) thanks to an aggressive store expansion program.

    The company’s unaudited gross profit increased 20.6 per cent.

    With a network total of 12,971 stores, Alfamart group remains narrowly behind competitor Indomaret, with 13,099, records research house IGD.

    Alfamart added 713 new stores from end of 2015, across the Lawson, Alfa Midi, Alfamart and Dan Dan (health and beauty) banners, compared to 889 reported by Indomaret.

    The new stores are mainly located outside of Greater Jakarta, which still accounts for 35.6 per cent of Alfamart’s stores, IGD reported.

    During the second quarter, the group added a warehouse in Serang, Java to support the Alfamart banner. As of June 2016, the retailer managed 40 warehouses in Indonesia (32 for Alfamart, seven for Alfamidi and one for Dan Dan).

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  • Indofood commissions instant noodle factory in Serbia

    Indofood commissions instant noodle factory in Serbia

    PT. Indofood Sukses Makmur, the largest instant noodle producer in Southeast Asia has expanded operation to Europe setting into operation its factory in Serbia.

    Serbian President Tomislav Nikolic officially commissioned the factory in Indjija, around 80 kilometers from Beograd on Friday, the Indonesian embassy in the Serbian capital city said.

    The factory, which produces ready for consumption Indomie noodles, was already operational in August opening hundreds of jobs for the Serbians .

    Construction of the factory in Serbia, would be the first step of the company in market expansion in Europe, an embassy official said.

    The factory, occupying a five hectare plot of lands was built with an investment of 11 million euro. It has a production capacity of 500,000 carton boxes per month for distribution not only in Serbia but also to other countries Europe.

    Free trade adopted by Serbia with various other countries in Europe would facilitate the company in market expansion giving it greater optimism in its ambition to dominate the European market of instant noodle.

    The official commissioning ceremony was attended by other Serbian leaders, members of the diplomatic Corps , business leaders and local journalists.

    Support shown by the Serbian government is a big factor in the success of the Indofood investment in that country.

    President Tomislav Nikolic said he appreciated and supported the Indonesian investment in Serbia as a concrete step to expand economic cooperation between the two countries.

    Indonesian Ambassador Harry R.J. Kandou said the presence of Indofood in Serbia constituted a concrete proof of Indonesian initiative in strengthening economic cooperation between the two countries.

    Anthony Salim, the Executive Director of the Salim Group, which owns Indofood, said he hoped that factory would provide gateway for the Indofood to reach the rest of Europe.

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  • Combo card will be tested in 40 cities

    Combo card will be tested in 40 cities

    The combo card that promotes non-cash social assistance will be tested in 40 cities until the end of 2016, Bank Indonesia (BI) has stated.

    If the trial goes off well, on January 1, 2017, the entire social assistance from the government can be channeled through the Family Welfare Card (KKS) Red and White combo device, Director of Elektronifikasi Program and Financial Inclusion of Bank Indonesia Pungky Purnomo Wibowo said Friday (September 2) night.

    “January 1, 2017, we apply all of the Family Hope Programs and the rice prosperous social assistance (Rastra). Further, the student aid program and the School Operational Assistance (BOS) will be around that time as well,” he said.

    The combo card can be used to avail the Rastra, and family expectations (PKH) aid, Pungky explained in the demonstration project or the pilot project.

    The combo card used in the “e-waroeng” (electronic shop and gotong royong/mutual help) are also agents of Financial Services Digital (LKD).

    The beneficiaries of social grants (bansos) bring the Cards Family Welfare (KKS) issued by the Bank to the new joint four, namely Bank Mandiri, Bank Rakyat Indonesia, Bank Negara, and Bank Tabungan Negara, and exchange it at “e-waroeng”.

    With the KKS, the public can receive Rastra basic foodstuffs such as rice, sugar, flour, and oil at subsidized prices.

    Furthermore, the combo cards can not only be used to get help in the LKD functions, but can also be used for transactions such as cash withdrawals or transfers, as well as saving money, such as bank function nirkantor (branchless banking), Pungky said.

    This combo card can make the distribution of social aid meet the rules of 6T – the right target, the right amount, the right price, right time, right quality, and right administration, Deputy Governor of BI Ronald Waas said on the occasion.

    The government budget for social protection in 2017 reached Rp158 trillion, the BI recorded. With that budget, social protection assistance would be effective and appropriate.

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  • Asian online shoppers habits uncovered

    Asian online shoppers habits uncovered

    Asian online shoppers research, locate, engage with and purchase products and services in entirely different ways in different markets, according to a new report.

    For example, almost all consumers in Indonesia knowingly provide brands with wrong details, including name (93 per cent), phone number (94 per cent), and email address (95 per cent) when researching or shopping online

    And the biggest driver of online-to-offline (O2O) conversions is with email in Singapore; SMS in Indonesia; chat apps in China; social media in Malaysia and Thailand and video ads in Hong Kong.

    And 27 per cent of consumers in China and 10 per cent of consumers in Singapore unknowingly input wrong payment details, breaking the region’s eCommerce’s momentum.

    Those are among many takes from The Digital Consumer View 2016 (Asia) report, released by global information services specialist Experian today, containing research from International Data Corporation (IDC), aimed at helping businesses better understand digital consumers in Asia.

    The report reveals how consumer behaviour varies across the key Asian markets of Singapore, Malaysia, Indonesia, Thailand, Hong Kong, and China, based on surveys with over 1200 digital consumers.

    Differences exist across channels (SMS, app notifications, email, social media, chat apps), devices (smartphone, feature phone, Wi-Fi/cellular tablet, wearable) and content (ads in email, ads in mobile apps, ads in social media, video ads on websites, and search ads). The findings highlight the complexity of reaching digital consumers in Asia across many channels, but also highlight how crucial that is, says Jeff Price, MD of Southeast Asia at Experian.

    “While the region is fast-growing, consumer behaviour in each market has unique disparities. Businesses today cannot succeed without intelligent insights based on consumer data,” he advises.

    “Asia is in the midst of a great digital revolution, with an explosion of smart devices, social media interactions and eCommerce transactions. While this evolution has greatly enabled and empowered both sides, it has also challenged businesses to be more effective and targeted in the way they communicate and market to this modern, digital-savvy consumer.

    “For companies to keep up with digital consumer behaviours – how they act on information – it’s absolutely vital to adopt and leverage what their consumers are providing them with every day – invaluable data. Businesses slow to act on this data will see their competitive advantage erode.”

    Key findings

    Experian - DCV - Region - Key findings

    • Search and discovery: Social media is the top channel in Singapore (31 per cent), Malaysia (49 per cent), Indonesia (67 per cent) and Thailand (58 per cent). It’s equally important as chat apps in China (47 per cent); in Hong Kong, video ads (63 per cent) trumps all.
    • Triggering product interest: Social media, once again, is the key driver in Singapore (28 per cent), Malaysia (44 per cent), Thailand (49 per cent) and Hong Kong (25 per cent). However, in Indonesia it’s SMS (62 per cent), and in China it is chat apps (48 per cent).
    • Triggering purchase intent: Email is the biggest driver of online to offline conversion in Singapore (27 per cent); SMS tops in Indonesia (57 per cent); chat apps in China (45 per cent); social media in Malaysia (44 per cent) and Thailand (51 per cent); and video ads tie with social media in Hong Kong (23 per cent).
    • Finding good deals: For unplanned purchases stemming from promotions, email leads in Singapore (34 per cent); social media in Malaysia (50 per cent), Indonesia (68 per cent) and Thailand (58 per cent); SMS in Hong Kong (36 per cent), and social media in China (51 per cent).
    • Brand engagement: Email is key for marketers to build engagement in Singapore (58 per cent) and Thailand (60 per cent); chat apps in Malaysia (62 per cent) and China (70 per cent); banner ads in Indonesia (56 per cent), and SMS in Hong Kong (61 per cent). While email is important, marketers need to be wary: more than 70 per cent of consumers reported receiving too many emails, up from 52 per cent in 2015.

    Experian - DCV - Region - The rise of omni-channel engagement 1

    Shiv Putcha, associate director, consumer mobility and telco strategy with IDC Asia Pacific, says businesses and brands cannot afford to ignore Asia’s multi-trillion-dollar digital commerce market. China alone is now the world’s largest retail market.

    “The challenge lies in the fact that the region has extraordinary differences – language, economy, purchasing power – and consumer behaviours, especially with the digital generation. That uniqueness will not diminish over the next few years and may even increase, making it challenging for marketers not using data-driven insights to research, plan and execute effectively. The Digital Consumer View 2016 (Asia) will hopefully serve as a valuable guide to deciphering some of these key trends, mapping the path forward for brands and their connected consumers.”

    Experian - DCV - Region - Top 3 types of ads that influence consumer's buying behavior

    Key Learnings for marketers in Asia

    • Over-reliance on a single marketing channel will not work. Depending on the country and its current state of digital sophistication, marketers need to think carefully about the right mix of channels to employ.
    • Quality over quantity. Consumer preferences for receiving promotional material varies from market to market, and by specific use cases. On a broader level, more is not necessarily better. A relevant and targeted message will ensure better conversion. Too much, and consumers are inclined to unsubscribe, delete, or mark content as spam.
    • The quality and integrity of data is crucial for marketers to find success. A significant number of consumers across the region either knowingly or unknowingly provide inaccurate information, which in turn causes errors and inaccuracies in marketer’s data sets. Around 27 per cent of consumers in China but only 10 per cent in Singapore unknowingly input wrong payment details; 40 per cent of consumers in China, and over 20 per cent of consumers in the rest of the region provide a wrong address at online checkout.

    Asia comprises 49.6 percent of the world’s Internet users, according to Internet World Stats (2016), digital commerce in the Asia-Pacific (excluding Japan) region will rise to US$17 trillion by 2019, up from US$7 trillion in 2015 according to International Data Corporation (IDC). The combination of rising incomes, increased consumption, acceleration of internet use, and the proliferation of mobile broadband access continues to unlock tremendous opportunities for marketers across the continent.

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  • Iflix wants to become a social media platform for TV

    Iflix wants to become a social media platform for TV

    Emerging subscription-based streaming video service iflix intends to set itself apart from Netflix by becoming a social media platform for television, according to company executive.

    “Netflix is very much into an original production base… they are really focusing their investment on content and user experience and interface,” Cam Walker, chief executive of iflix Indonesia, told telecomasia.net at the sidelines of Communic Indonesia and Broadcast Indonesia 2016, which kicked off Wednesday at the Jakarta International Expo in Kemayoran, Central Jakarta.

    “We have just most recently decided to venture beyond entertainment into becoming a truly social platform for television.”

    To do that, Walker said the company is planning to introduce more social media components and interactive features to the service. For instance, the company will offer a social feature later this year where users can chat with others or interact with local celebrities who have drawn up movie playlists for them.

    Iflix launched its service in Indonesia in mid-June this year and garnered 250,000 activations in about two-and-a-half months.

    Walker said the Indonesian market is relatively new from an OTT perspective and doesn’t see other streaming services as competitive, as they are all heading in different paths.

    “We’re the new kid on the block. We started a couple of years as a cool internet TV concept, with a vision to provide a better service to piracy and a viable alternative at an affordable price point,” he said.

    iflix is now offering 2,000 seasons of 900 programs, 5,000 episodes of 200 kids programs and local content acquired from partners for its Indonesian viewers.

    Walker said iflix will soon produce its first local Indonesian content that will open more opportunities for local actors, producers, directors, scriptwriters and “the new breed of Indonesian talents.”

    “We’re going to be investing heavily in local productions and local acquisitions as well, which I think will differentiate us from the major international players,” he said.

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  • Manulife in upbeat mood after first half surge

    Manulife in upbeat mood after first half surge

    Manulife Indonesia president director and chief executive officer (CEO) Indren S. Naidoo (right) and Manulife Aset Manajemen Indonesia chief economist and investment strategist Katarina Setiawan talk on the sidelines of a press briefing in Jakarta on Wednesday.

    Despite the country’s weak economy, life insurer Manulife Indonesia enjoyed a sharp increase in new business premiums during the first semester of the year on the back of surging wealth and insurance sales.

    Its total new business premiums soared by 28 percent year-on-year (yoy) to Rp 1.8 trillion (US$135 million) in the first semester, according to Manulife’s unaudited financial results for the first semester of 2016.

    During the January and June period, Manulife’s wealth sales rose 27 percent yoy to Rp 1 trillion from
    Rp 785 billion, while its insurance sales increased 17 percent yoy to Rp 764 billion from the corresponding period in 2015.

    As of June, Manulife’s total premium and deposits amounted to Rp 9.1 trillion, a 12 percent hike from Rp 8.1 trillion recorded in the same month last year. The number of the company’s in-force policies, meanwhile, grew steadily to 2,297,305 from 2,250,210 recorded in June last year.

    “We are confident that our business will book positive growth over this year,” Manulife’s newly appointed president director and chief executive officer Indren S. Naidoo told a press briefing on Wednesday.

    Indren, who assumed his position in May, said he was optimistic that the company could tap into the growing insurance market in Indonesia, which is the most populous country in Southeast Asia, but has low insurance penetration.

    Indonesia’s economy expanded an annual 4.92 percent in the January-March quarter, below analysts’ expectation of 5.05 percent. Growth weakened for the fifth straight year in 2015, to 4.8 percent, amid poor commodity prices and contracting exports.

    Financial Services Authority (OJK) data showed that conventional insurance premiums accounted for just 2.37 percent of the country’s gross domestic product (GDP) during the first quarter of the year. Life insurance penetration rates, meanwhile, reached 0.93 percent of the GDP in the January-March period.

    “Compared to some other markets in Asia, we are actually quite low. So, the opportunity is there,” said Indren, who previously assumed CEO positions at Manulife units in the Philippines, Thailand, Vietnam and Cambodia prior to his current position.

    Indren said Manulife would continue to expand its unit-linked products, which have become the main driver of the company’s business growth.

    The contribution of Manulife’s unit-linked products, which combine insurance and investment products such as government bonds and stocks, “was close to 80 percent of our business”, Indren said, explaining that the insurer would continue to promote the instrument as customers still expected double-digit returns on their investment amid the downward trend in banks’ deposit interest rate.

    In the first half of the year, Manulife launched unit-linked product Mi Wealth Insurance to further boost its investment-linked insurance products.

    He expressed his optimism that the burgeoning middle-income segment in the country, expected to reach 100 million of people by 2020, would be a boon for Manulife’s unit-linked products, which are aimed to higher-end customers.

    The CEO said Manulife would continuously educate potential customers on life insurance, as well as its unit-linked instruments by leveraging its 8,000 agents in 25 branches across the country and its bankassurance service, for which the insurer has forged partnerships with three lenders in the country: DBS, Bank Danamon and sharia-based Bank Muamalat.

    “We are here not to sell, but to teach [the customers]. At the end of the day, you, as a customer, will make the decision [on whether to buy Manulife’s products],” Indren said.

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  • Indonesia’s inflation rate at seven-year low

    Indonesia’s inflation rate at seven-year low

    Indonesia’s inflation slowed to the weakest in almost seven years and fell below the central bank’s target, bolstering the case for further interest rate cuts by Bank Indonesia (BI).

    Consumer price gains eased to 2.79 per cent last month from a year earlier, compared with economists’ 3.02 per cent estimate.

    Prices fell 0.02 per cent in August from the previous month, the National Statistics Office said yesterday, adding that the annual rate was the lowest since December 2009.

    “If you ask me now whether there is room for (monetary) easing, the room is more open. But whether it would be used or not, it is up to BI,” Coordinating Minister for Economics Darmin Nasution said after the lower-than-expected data was announced.

    Mr Nasution said BI had wanted to cut the benchmark rate “since last month” but then decided to delay to better introduce its new policy rate, the seven-day reverse repo rate, which stands at 5.25 per cent.

    The authorities have set their 2016 inflation target at 3 per cent to 5 per cent and expect consumer price gains to end the year at around 3.5 per cent.

    “Easing inflation – along with stability in both the current account deficit and exchange rate – has created policy space for rate cuts,” said economist Ng Weiwen at Australia & New Zealand Banking Group (ANZ).

    “The degree of easing will be dependent on the size of tax amnesty inflows.”

    ANZ expects the Indonesian central bank to lower its new benchmark rate by another 25 basis points to 5 per cent as soon as its September meeting, Mr Ng said.

    Indonesia’s 10-year bond yield slid four basis points to 7.07 per cent yesterday afternoon in Jakarta, set for the biggest daily gain in three weeks. Shares fell, with the Jakarta Composite Index extending its drop to 0.9 per cent and set for the lowest close since Aug 15.

    Falling airfares, inter-city transport costs and cheaper food were the biggest factors driving the monthly drop in prices, said National Statistics Office deputy Sasmito Hadi Wibowo.

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  • Minister sees off organic rice export to Belgium

    Minister sees off organic rice export to Belgium

    Agriculture Minister Andi Amran Sulaiman here on Thursday saw of the shipment 40 tons of organic rice produced by a farmer group of Simpatik in Mekar Wangi village, West Java to Belgium.

    The shipment marked eight years of organic rice export from the farmer group to Belgium.

    The exported rice was packed in airtight plastic that can last for months. One pack of rice weighed five kilograms with a label of Indonesia Rice on it.

    In addition to Belgium, the other importer countries are Singapore, Italy, United States, and United Arab Emirates.

    The rice price at the farm level reaches Rp 20 thousand per kilogram, but in Belgium it is Rp90,000 per kilogram.

    At the farmers level, the price of the rice is Rp20,000 per kilogram, while in Belgium it reaches Rp90,000 per kilogram.

    Amran said every year Indonesia is able to export 100 thousand tons of organic rice, so that it will be the future of Indonesian agricultural products.

    “It is a smart agriculture. I have asked the Research Agency to support the organic rice farming. This is the future of rice exports. We just improve the regulation to make this sector competitive,” he said.

    The minister said that in addition to Java, Sumatra and Kalimantan also have potential in the rice organic agriculture.

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  • KinerjaPay Launched “I Love Indonesia” Campaign

    KinerjaPay Launched “I Love Indonesia” Campaign

    KinerjaPay launched “I Love Indonesia” Campaign to promote selected premium local products in its marketplace. This campaign is also to celebrate Indonesia’s 71st Independence Day anniversary on 17 August 2016. It is also designed to increase people’s love for domestic products and stimulate domestic consumption.

    Indonesia is a country of big numbers and big opportunity. With 252 million inhabitants it is the world’s fourth most populous country and the largest in south east Asia. Indonesia has 18,307 islands, over 742 different languages and a middle class larger than the population of Malaysia or Australia. Currently the 16th largest economy in the world, it is projected to be the seventh largest economy in the world by 2030. Catching the hype and realizing that a young population embracing the Internet faster than ever before. Mr. Sofyan Djalil as the Indonesia State Enterprise Minister once said he supported any form of program that boost love for the country’s products. “So far, people are not aware that the quality of Indonesian products is already good. I appeal to all state-owned companies to really take the opportunity, provide funds and put up the logo in their ads. They must do whatever they can to make the campaign effective,” he said.

    On the other hand, this campaign also means to promote national products abroad. In making an effective on this goal, The Company is also collaborating with overseas partners such as in Singapore to assist SMEs to expand their businesses internationally especially in South East Asia (SEA). The idea is to leverage strategic values and locations of Indonesia and Singapore, running many regular and ad-hoc events such as monthly networking events, trainings, site visits, and trade exhibitions.

    Mr. Deny Rahardjo, CEO for PT KinerjaPay Indonesia stated “We are very excited and optimist on the success of this campaign to promote Indonesia’s selected local prominent and unique merchants such as Batik, Indonesian coffee bean and handcrafted products. There are currently already more than 418 premium products and 14 prominent merchants have agreed to join the campaign that is planned to run until end of 2016. We do hope that this will bring positive impact towards local economy while promoting KinerjaPay as brand of trust.”

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    Forward-looking statements relate to anticipated or expected events, activities, trends or results as of the date they are made. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties that could cause KPAY’s actual results to differ materially from any future results expressed or implied by the forward-looking statements. Many factors could cause KPAY ‘s actual activities or results to differ materially from the activities and results anticipated in such forward-looking statements, including, but not limited to, the factors summarized in KPAY ‘s filings with the SEC. In addition, KPAY operates in an industry sector where securities values are highly volatile and may be influenced by economic and other factors beyond its control.

    KPAY does not undertake any obligation to publicly update these forward-looking statements, whether as a result of new information, future events or otherwise. Please see the risk factors associated with an investment in our securities which are included in our Annual Report on Form 10-K as filed with the U.S. Securities and Exchange Commission on February 11, 2016.

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