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Tag: Indonesia

  • Here are Indonesia’s top 10 retailers according to Euromonitor

    Here are Indonesia’s top 10 retailers according to Euromonitor

    Indomaret convenience store chain leads the rankings of Indonesia’s top 10 retailers.

    The Indomarco Prismatama-owned convenience store chain achieved sales of US$4.89 billion last year, followed by Alfamart with $3.97 billion, according to Euromonitor.

    Speaking at a conference where Indonesia’s top 10 retailers were revealed, Euromonitor’s Dhea Sutanto said Indomaret’s success was likely attributable to the greater number of physical stores it had compared to its competitors, and its promotion strategy.

    “If it is able to reach more consumers and more outlets, automatically it will generate more revenue, especially if it provides more accessibility to consumers that are harder to reach,” she added.

    Indomaret currently operates 15,633 outlets across Indonesia while Alfamart has 13,991.

    Matahari Department Store took third spot on the list with $1.36 billion in sales, followed by Carrefour and Transmart Carrefour by Trans Retail Indonesia, which earned $1.22 billion.

    In fifth place was Dairy Farm International operation which includes Hero Supermarket Group, Guardian, Star Mart and Giant, among others, with $903 million in sales.

    High-end fashion retailer Mitra Adi Perkasa, which owns Kidz Station, Marks & Spencer and Sports Station, came in sixth with $866 million. It was followed by Matahari Putra Prima group (Hypermart, Boston Health), gadget retailer Erajaya Swasembada (Erafone) and middle-to-low-income fashion retailer Ramayana with $781 million, $688 million and $643 million in sales, respectively.

    Books and stationery stores Gramedia, Grazera and Trimedia from Gramedia Asri Media ranked 10th by earning $430 million in sales.

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  • Indonesia’s Tauzia Hotels Joins Hands With Ascott for Southeast Asia Expansion

    Indonesia’s Tauzia Hotels Joins Hands With Ascott for Southeast Asia Expansion

    Green Oak Hotel Management, the holding company of Tauzia Hotels, announced on Thursday that it will cooperate with Ascott Limited, an international serviced-residence operator, to expand its business in Southeast Asia.

    The plan will see Tauzia open hotels in Malaysia, the Philippines, Cambodia, Laos and Myanmar.

    Tauzia currently operates 122 hotels, with a total of nearly 20,000 rooms, in Indonesia and Vietnam under six brands, including Harris, POP!, YELLO, Fox Harris, Harris Vertu and Préférence.

    Most of the company’s hotels are in Indonesia, mainly in Jakarta, Bali, Bandung (West Java), Surabaya (East Java) and Yogyakarta.

    “This partnership will enhance Tauzia’s future growth and performance as Ascott’s expertise and support will contribute greatly toward expanding our brand and product offerings in Asia and even beyond,” Tauzia Hotels founder Marc Steinmeyer said in a statement.

    Around 70 percent of its customers are business travelers, while the remainder are leisure travelers.

    The company has opened 10 hotels, with a total of 1,500 rooms, so far this year, including a POP! Hotel and Harris Hotel in Solo and Semarang in Central Java, a Fox Harris Hotel in in Bali and in Bandung, West Java, and a Harris Resort in Batam, Riau Islands.

    The company plans to open Liu Men by Préférence – its high-end hotel brand – in Melaka, Malaysia, before the end of this year.

    Through Ascott’s investment in Tauziah, the company expects to capture the untapped, but growing market in the region as it sees strong opportunities in the middle-class and business segments, Ascott chief executive Kevin Goh said.

    “[The growing middle-class] is brought on by the rise of the economy, commuters, infrastructure builders, other project-based workers and tech-savvy, self-sufficient and value-conscious leisure travelers. With our investment in Tauzia, we look forward to accessing this market, which is one of the fastest-growing segments in the hotel industry,” Goh said.

    He said Ascott will help Tauzia to access the international market by connecting the group to its 100,000 global corporate clients.

    Singapore-headquartered Ascott has had a presence in Indonesia for the past 22 years. The company operates 17 serviced residences, with a total of more than 3,000 residential units, in Jakarta, Bali, Bandung, Surabaya, Yogyakarta, Karawang (West Java) and Makassar (South Sulawesi).

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  • Weakening Rupiah Sees Calls for Gov’t to Scrap Palm Oil Export Tax

    Weakening Rupiah Sees Calls for Gov’t to Scrap Palm Oil Export Tax

    A lawmaker and an industry analyst have called on the government to scrap its export tax on crude palm oil to help improve the competitiveness of the sector and boost exports, amid a weakening rupiah.

    Since 2015, the  Indonesian Oil Palm Estate Fund (BPDPKS), which is tasked with strengthening and promoting sustainable practices in the industry, has been imposing a $50 per ton export levy on crude palm oil and $30 per ton levy on crude palm oil derivative products when prices drop below $750.

    The levies were imposed to encourage local producers to sell more of their products at home and to incentivize local biodiesel producers. However, palm oil producers have complained about this policy since the start, as it burdens those seeking to export their products, which is more beneficial during a stronger dollar.

    “Under this condition, the government needs to be flexible in imposing some policies. It should consider scrapping the export tax … to help us to achieve a trade surplus,” said Eriko Sotarduga, a member of House of Representatives Commission VI, which oversees trade, industry and business competition.

    The rupiah strengthened to 14,825 to the dollar on Friday from 14,840 previously, according to data. It has fallen by 8.5 percent so far this year. Indonesia’s trade balance returned to a $1.72 billion surplus in August after recording its first deficit in 19 months in July.

    Eriko said amid the current low price of crude palm oil, scrapping export levies could help producers to expand the market, because they have been struggling to compete with other vegetable oils.

    Meanwhile, Bungaran Saragih, an advisor at the Palm Oil Agribusiness Strategic Policy Institute, said the government must provide the industry with its full support, given the fact that the industry sustains millions of people, with about 40 percent of the country’s production coming from smallholders.

    “Nowadays, palm oil is the best commodity” to support the nation’s economy and currency. Therefore, it deserves some incentives, he said.

    The government has been very careful in dealing with the sector as the commodity is the biggest foreign-exchange contributor.

    Palm oil exports reached their highest value ever last year at $23 billion, which was a 26 percent increase from 2016.

    However, the current administration is also cautious about issuing new permits to producers. President Joko “Jokowi” Widodo ordered a review of existing permits on Wednesday, amid growing concern over deforestation in the country.

    As reported earlier this week, environmental activist group Greenpeace International accused 25 palm oil producers, supplying some of the world’s most renowned brands, of contributing to massive forest destruction.

  • Indonesia to Host World’s First Conference on Creative Economy in November

    Indonesia to Host World’s First Conference on Creative Economy in November

    Indonesia is set to host the first World Conference on Creative Economy, which will serve as a forum for government representatives and industry players to exchange ideas establish common ground and resolve challenges in the industry.

    “The speakers will come from different parts of the world and they will present their views on the current state of the creative economy and their vision of the future of this industry,” Creative Economy Agency (Bekraf) chairman Triawan Munaf said at a press conference in Jakarta on Tuesday.

    The inaugural conference will take place in Nusa Dua, Bali, on Nov. 6-8 and will involve around 1,000 participants, including ministers and business leaders, from 50 countries. These include Peter Trillingsgaard, vice president for government and public affairs at the Lego Group; Le Kexi, president of the China Film Corporation, Indonesian Finance Minister Sri Mulyani Indrawati, Bukalapak chief executive Achmad Zaky and Tokopedia chief executive William Tanuwijayia.

    “This conference is part of our effort to increase our capacity as a country, to further strengthen our creativity and competitiveness, and to achieve prosperity for the people,” Deputy Foreign Minister A.M. Fachir said.

    With “Inclusively Creative” as the main theme, participants will discuss key issues in the creative economy, including social cohesion, regulations, marketing, ecosystems and financing.

    The creative economy is a tool to facilitate better communication and understanding across the economic and cultural divide, especially because the industry has the potent to create opportunities for all, regardless of age, gender, background or geographic location, Triawan said.

    Fachir added that the conference forms part of Indonesia’s efforts to realize the United Nations Sustainable Development Goals, such as decent work and economic growth and reduced inequality.

    “It is both fitting and a duty for Indonesia to become a leader in the creative economy because we have what it takes,” Triawan said, adding that Indonesia plans to hold the event biannually.

    Indonesia’s creative economy has been on the rise over the past few years. It contributed more than Rp 922 trillion ($61.7 billion), or around 7.4 percent of the country’s economy, in 2016.

    Endah Sulistianti, deputy for inter-region and institution relations at Bekraf, said the conference aims to present the potential of creativity for the future of the world.

    “We are proposing to the world this tangible and infinite possibility, from creativity as [one of the solutions] to the limits of our natural resources,” Endah said.

    The conference will coincide with CreatiVillage, an exhibition space for ideas, concepts and products of various countries. Endah said it will feature creative works from South Korea, China, Saudi Arabia, and Denmark, among others.

    Business and investment forums, as well as business-matching sessions, will also take place on the sidelines of the event.

    The conference is expected to conclude with a set of recommendations on the creative economy, which will be presented at next year’s session of the United Nations General Assembly in New York.

    Fachir said Indonesian officials attending the ongoing session of the General Assembly are lobbying UN member countries to support efforts that will boost the role of creative the economy across the globe.

  • Indonesia Needs to Raise Rate to Stay Ahead of the Curve

    Indonesia Needs to Raise Rate to Stay Ahead of the Curve

    Bank Indonesia, the country central bank, needs to raise its benchmark interest rate on Thursday (25/09) or risks to be left behind the curve and sees a further weakening of the rupiah, economists said.

    “Bank Indonesia must be ahead of the curve amid the trend of rising global interest rates,” said Cyrillus Harinowo, a former central banker and now a commissioner at Bank Central Asia, Indonesia’s third-largest lender by market capitalization.

    Bank Indonesia has increased its benchmark 7-day reverse repo rate by 125 basis points so far this year, while the Federal Reserve has raised its interest rates by 175 basis points. That narrowed the interest rate differential between Indonesia’s interest-bearing assets and similar assets in the US, making the former more risky to hold for foreign investors.

    Cyrillus said Bank Indonesia has 12 times a year to raise the benchmark rate, compared to 4 times in the US, which should give it more leeway for adjusting its monetary policy.

    A Reuters poll showed that 20 out of 25 economists predict Bank Indonesia will increase its 7-day reverse repurchase rate by 25 basis points (bps) to 5.75 percent.

    Three other analysts see BI making a bolder move of hiking by 50 bps, while the last two predict the central bank will stand pat.

    The rupiah has lost about 9 percent against the dollar this year amid a sell-off of Indonesian assets due to rising US interest rates, contagion fear from other emerging market crises and the US-China trade war.

    Since BI’s last hike on Aug. 15, the currency has hit its lowest level since the 1998 Asian financial crisis and continued to trade near that level.

    Indonesia’s economy fundamental today, however, is far different from two decades ago, Tony Prasetiantono, the head of the Center for Economic and Public Policy Studies at Gajah Mada University (UGM).

    That time the rupiah nosedived by almost 600 percent from 2,300 a US dollar to 15,000. Indonesia’s economy contracted in 1998. Today it is still growing albeit at a slower pace of 5.17 percent compared to the government target of 5.4 percent.

    “Another indicator is inflation. Currently, it is around 3.5 percent while in the 1998 crisis it was 78 percent,” Tony said.

    “And the main thing is that the banking fundamentals are very healthy at the moment, much different from 1998,” he said.

    August Trade Deficit

    Fed officials have signaled a likely quarter-point rate increase at their meeting which ends early Thursday Asia time.

    Fakhrul Fulvian, Trimegah Securities economist, said he changed his view on Thursday’s decision from a hold to a 25 bps hike after “not as good as we had estimated” August trade data. The month’s deficit was $1.02 billion, much wider than the $680 million the market expected.

    The government has taken steps to curb imports, including imposing higher tariffs on over 1,000 imported goods, widening biodiesel use and delaying big infrastructure projects.

    “A relatively high level of foreign currency debt explains why the Indonesian authorities are worried when the currency falls sharply,” said Capital Economics, one of the large majority seeing a 25 bps hike on Thursday.

    Foreign investors own about 37 percent of Indonesian government bonds.

    BI officials have repeatedly pledged to be “ahead of the curve” in setting monetary policy.

    On Friday, Governor Perry Warjiyo said that investors had begun to resume buying emerging-market assets, and this plus exporters converting their earnings had increased the domestic supply of dollars.

    He also said inflation should stay benign until the end of the year despite the rupiah’s fall. The annual rate in August was 3.20 percent, within BI’s 2.5-4.5 percent target range.

    Satria Sambijantoro, Bahana Sekuritas economist and one of the two in the poll predicting a hold on Thursday, said Indonesian bonds, at current rates, are attractive.

    “The central bank is already ahead of the curve,” he said.

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  • Indomaret tops retailer list with US$4.89b in sales

    Indomaret tops retailer list with US$4.89b in sales

    Convenient store chain Indomaret and Indomaret Point, owned by retail group Indomarco Prismatama, were the top-selling retailers of 2017, racking up a combined US$4.89 billion in sales, according to London-based strategic market research company Euromonitor International

    With the total sales, Indomaret beats its closest competitor Alfamart, owned by Sumber Alfaria Trijaya, which booked US$3.97 billion in sales last year to come in second.

    Euromonitor consultant Dhea Sutanto said Indomaret’s success was likely attributable to the greater number of physical stores it had compared to its competitors. Another factor could be the company’s promotion strategy, she added.

    “If they are able to reach more consumers and more outlets, automatically they will generate more revenue, especially if they provide more accessibility to consumers that are harder to reach,” she said at the sidelines of the Euromonitor International Conference on Tuesday.

    Indomaret currently operates 15,633 outlets across Indonesia while Alfamart has 13,991.

    Number three on the list of Indonesia’s top retailers in 2017 was Matahari Department Store with $1.36 billion in sales, followed by Carrefour and Transmart Carrefour by Trans Retail Indonesia, which earned $1.22 billion. Hero Supermarket Group with Guardian, Star Mart and Giant, among others, was at fifth place with $903 million in sales.

    A retailer group of high-end fashion goods, Mitra Adi Perkasa (MAP), which includes Kidz Station, Marks and Spencer and Sports Station, came in sixth with $866 million. MAP is followed by Matahari Putra Prima group (Hypermart, Boston Health), gadget retailer Erajaya Swasembada (Erafone) and middle-to-low-income fashion retailer Ramayana with $781 million, $688 million and $643 million, respectively.

    Meanwhile, books and stationery stores Gramedia, Grazera and Trimedia from Gramedia Asri Media ranked 10th by garnering $430 million in sales.

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  • BRI, BCA unveil new digital banking products for Indonesia

    BRI, BCA unveil new digital banking products for Indonesia

    In a bid to expand their customer base, state-owned lender Bank Rakyat Indonesia (BRI) and private lender Bank Central Asia (BCA) have invested in new digital banking products.

    BRI director Indra Utoyo said the new product was slated to launch before the end of the year. “Our new digital banking product will offer micro, retail and consumer loans,” Indra said last Thursday.

    He added that the product was expected to expand the lender’s customer base and beef up its micro, retail and consumer loan business.

    BRI’s new digital banking product would include the latest omni channel feature and biometric technologies, said Indra, adding that the bank had invested Rp 500 billion (US$ 34.83 million) to develop the new product.

    Meanwhile, BCA has unveiled its plans for a new digital banking product that promises simpler transactions on e-commerce platforms. The product is expected to launch in October.

    “The [digital banking] service will support transactions made through credit cards, debit cards and bank transfers,” said BCA financial director Vera Eve Lim on Monday, adding that the product would also offer support for financial settlements.

  • Lumine revealed Indonesia expansion

    Lumine revealed Indonesia expansion

    Japanese urban retail concept Lumine is set to open its first store in Jakarta in December.

    Opened in partnership with local retailer Time International, the store at the Plaza Indonesia mall will be Lumine’s second overseas location. The launch is timed to commemorate the 60th anniversary of the establishment of diplomatic relations between Indonesia and Japan.

    President and CEO of Lumine Yuji Morimoto said: “We are very excited to launch our second overseas store, to collaborate with a leading retailer Time International, in Plaza Indonesia. For both Indonesia and Japan, this year is a meaningful anniversary. We hope to become a place that stimulates the sensibilities of our customers, not just a place where they can purchase products.”

    The approximately 1200sqm specialty store offers chic Japanese lifestyle and fashion brands.

    Offerings include womenswear, menswear, miscellaneous lifestyle goods, and a café. Its main target customers are independent women with a global outlook who are sensitive to trends and possess unique and distinctive styles.

    Lumine operates 15 branches in Japan and one in Singapore, which opened last November.

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  • JD launches online shopping service in Indonesia

    JD launches online shopping service in Indonesia

    Chinese e-commerce giant JD has initiated a grocery delivery service at Commuter Line train stations in the Greater Jakarta area.

    The new online retail store, JDVirtual, allows customers to use QR codes to purchase groceries to be delivered to their homes. The store sells food, beverages, and other grocery products found in conventional retail outlets.

    The initiative serves to test a new business model while targeting the high number of Commuter Line users in Jakarta, which serves an average of 1 million people per day.

    Users of the JD.ID app can purchase products immediately by scanning JDVirtual codes. The whole transaction process is completed within the app.

    Zhang Li, JD.ID’s president director said: “The customers are our inspiration in doing business in Indonesia. We believe that with JDVirtual, a borderless shopping concept will provide a real solution for modern retail industry, while also helping to run our mandate to help bring Indonesia forward.”

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  • Indonesia’s Dollar Supply Increases as Investors Return

    Indonesia’s Dollar Supply Increases as Investors Return

    The value of the rupiah has stabilized in recent days as the domestic supply of dollars has increased due to inflows from returning investors and more exporters converting their earnings, Bank Indonesia Governor Perry Warjiyo said on Friday (21/09).

    “The rupiah has stabilized and it tends to strengthen,” Perry said. “Many fund managers have begun to invest and allocate their portfolios to emerging markets. So what was going out has begun to return.”

    The rupiah traded at 14,815 to the dollar at 1.05 p.m. in Jakarta on Friday, marginally stronger than Thursday’s closing.

    Perry also said inflation is expected to stay benign this year despite the rupiah’s fall, saying the rate is seen near the lower end of Bank Indonesia’s 2.5 percent to 4.5 percent target range. The annual inflation rate stood at 3.20 percent in August.

    Bank Indonesia has raised interest rates four times since mid-May to defend the rupiah, which fell to its weakest in 20 years amid wider emerging market selloffs. It will meet again next week to review monetary policy.

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  • Indonesia Imposes Three-Year Moratorium on New Palm Oil Plantation Licenses

    Indonesia Imposes Three-Year Moratorium on New Palm Oil Plantation Licenses

    President Joko “Jokowi” Widodo signed a moratorium on new oil palm plantation permits on Wednesday (19/09) and ordered a review of existing permits amid growing concern over deforestation in the country.

    The instruction, which is set to remain in place for three years, applies to new and submitted requests, as well as those approved but do not yet include set boundaries and those inside natural forests.

    Jokowi initially promised to issue the moratorium on April 2016, after months of forest fires and haze, which affected Indonesia and neighboring Malaysia and Singapore.

    He ordered ministers and regional governments to improve the management and productivity of sustainable oil palm plantations as part of efforts to preserve the environment, as laid out in a 2018 presidential instruction on license suspension and evaluation of oil palm plantations.

    In a report published earlier this week, Greenpeace International said 25 palm oil producers supplying some of the world’s largest brands, including Unilever, Mondelez and L’Oréal, have destroyed more than 130,000 hectares of natural forest in Indonesia since 2015.

    The Indonesian Forum for the Environment (Walhi) welcomed the long-awaited signing of the document and pointed to several issues the government still has to watch out for, including law enforcement against companies violating existing regulations.

    Walhi, the oldest environmental advocacy group in Indonesia, added that the wellbeing of oil palm farmers must also be considered as part of efforts to boost productivity of plantations.

    “In the long-term, this moratorium should ideally be in place for 25 years … because in our view, environmental recovery takes a long time,” the group said in a statement.

    It added that the license evaluation process must form an inseparable part of the president’s flagship land reform program.

    Meanwhile, the Indonesian Palm Oil Association (Gapki) said it supports government efforts to make palm oil sustainable and improve productivity in the sector.

    “However, because the presidential instruction was just issued recently, Gapki needs to study the document and coordinate with relevant ministries to avoid multiple interpretations and disincentives in the palm oil industry,” Gapki spokesman Tofan Mahdi said.

    Indonesia is the world’s largest palm oil producer. The country exports of the commodity reached its highest ever value last year at $23 billion, which was a 26 percent increase from 2016.

  • Go-Jek Aims to Raise $2b for Southeast Asia Expansion

    Go-Jek Aims to Raise $2b for Southeast Asia Expansion

    Indonesian ride-hailing firm Go-Jek is seeking to raise about $2 billion from existing investors, including Tencent Holdings and JD.com, to fund its expansion plans in Southeast Asia, sources familiar with the matter said on Monday (17/09).

    Go-Jek’s fundraising comes as its main rival Singapore-based Grab is also building a war chest to transform itself into a consumer technology group and aggressively grow in Indonesia, Southeast Asia’s biggest economy.

    Both Go-Jek and Grab are raising billions of dollars and investing hundreds of millions of dollars in the race to gain dominance in Southeast Asia. More and more of the region’s 640 million consumers are going online, and starting to make use of smartphones to shop, commute and make payments.

    “Chinese investors have very, very deep pockets but the total amount depends on how demand shapes up,” said one source who was not authorised to speak to the media. Go-Jek’s other existing investors include private equity firms Warburg Pincus and KKR.

    Indonesia — home to 250 million-plus people — is shaping up as a battleground for global tech giants such as Alibaba , Tencent, JD.com, Google and Softbank Group in the fight for market share in ride-hailing, online payments and e-commerce.

    Launched in 2011 in Jakarta, Go-Jek — a play on the local word for motorbike taxis — has evolved from a ride-hailing service to a one-stop app through which its customers can make online payments and order everything from food, groceries to massages.

    Go-Jek said in May it would invest $500 million to enter Vietnam, Singapore, Thailand and the Philippines, after Uber struck a deal to sell its Southeast Asian operations to Grab.

    Go-Jek was last estimated to have a valuation of about $5 billion when Google, Singapore state investor Temasek Holdings and others came in as investors in its $1.5 billion funding earlier this year.

    The new funding is set to be completed later this year, the sources said.

    Go-Jek and JD.com declined to comment. There was no immediate response from Tencent.

    Go-Jek founder and CEO Nadiem Makarim said last month the company was seeing strong funding interest from its backers as it targets an aggressive expansion.

    Go-Jek is a dominant force in Indonesia, where it processes more than 100 million transactions for its 20-25 million monthly users.

    Ride hailing services in Southeast Asia are expected to surge to $20.1 billion in gross merchandise value by 2025 from $5.1 billion in 2017, according to a Google-Temasek report.

    Bloomberg reported news of Go-Jek’s fundraising late on Sunday.

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  • DHL Express Opens $2.98m Distribution Center in East Jakarta

    DHL Express Opens $2.98m Distribution Center in East Jakarta

    The local unit of Deutsche Post DHL, the world’s largest logistics company, has opened a $2.98 million facility in Pulogadung, East Jakarta, to accommodate growing demand and expand its presence in the capital.

    The new facility, located in Jakarta Industrial Estate Pulogadung, replaces the old one in Kelapa Gading, North Jakarta, which has exceeded its capacity.

    “The facility is proof of our commitment to meeting customers’ needs and international shipping demand. With this new strategic location, we expect to bring world-class services to our business customers,” Ahmad Mohamad, senior technical advisor at DHL Express Indonesia, said in a statement on Monday (17/09).

    The 1,800 square meter facility, which is equipped with motorized conveyor belts and weighing equipment to improve efficiency and accuracy, has the capacity to process 314,000 parcels annually. It is also equipped with an advanced security system, including 70 closed-circuit television cameras.

    The newly opened Pulogadung facility is one of several investments DHL Express has made in Indonesia.

    The company also has a gateway facility at Soekarno-Hatta International Airport in Tangerang, Banten; new service centers in Batam, Riau Islands; Solo, Central Java; and Makassar, South Sulawesi; and mobile service stations in several areas in Jakarta.

    DHL Express’s 7,000-square-meter distribution center in Cengkareng, Banten, established in November last year, is the company’s largest investment in Indonesia at Rp 60 billion ($4.03 million).

    The company, which operates in Indonesia through Birotika Semesta, reportedly plans to invest $2 million this year to expand its existing distribution centers and establish new service centers in several locations in the archipelago, while also increasing its cargo-carrying capacity.

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  • Indonesian trade deficit narrows in August

    Indonesian trade deficit narrows in August

    Indonesia’s trade deficit narrowed in August, but the gap was larger than expected as exports growth slowed, government data showed on Monday, adding to pressure on the rupiah and local stocks.

    Southeast Asia’s largest economy reported a trade deficit of US$1.02 billion (RM4.22 billion) for last month, much bigger than the US$680 million gap expected in a Reuters poll.

    The country had a revised US$2.01 billion trade deficit in July, the largest in five years.

    August imports were worth US$16.84 billion, up 24.65% from a year earlier, data released by the statistics bureau showed. This compared with expectations of a 26.53% t rise in the poll. Meanwhile, exports growth slowed to 4.15% from a year earlier to US$15.82 billion in August, compared with the poll forecast of a 10.03% increase.

    Imports of consumer goods posted the biggest annual growth last month, while exports of agriculture products fell nearly 21% from a year earlier, the data showed, contributing to the slowdown in exports. Higher oil and gas imports also contributed to the deficit, according to the statistics bureau.

    The rupiah slipped further after the data came in to trade at 14,885 per dollar, 0.57% below Friday’s close. The Indonesian currency traded at 14,880 per dollar before the data.

    The rupiah has been trading at 20-year lows after being sucked into an emerging market rout, with selling exacerbated by concern over the country’s ability to plug a yawning current account deficit.

    Jakarta’s benchmark stock index also extended falls to trade 1.8% lower, while the 10-year bond yield rose to 8.428% from 8.382% at yesterday’s opening.

    The tariffs were not applied in August, but analysts have said importers may have frontloaded overseas purchases ahead of the increases.

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  • Go-Jek launches services in Hanoi amid $500 million overseas expansion drive

    Go-Jek launches services in Hanoi amid $500 million overseas expansion drive

    Indonesian ride-hailing firm Go-Jek on Wednesday launched its services in Vietnam’s capital of Hanoi under the brand Go-Viet.

    The move is part of Go-Jek’s $500-million international expansion.

    The app-based on-demand service Go-Viet, driven by a Vietnamese founding team, with Go-Jek providing technology, expertise and investment, offers services ranging from transport and logistics to food-delivery and mobile payments.

    Go-Viet grabbed a 35 percent share of the market for motorbike ride-hailing services in the economic hub of Ho Chi Minh City just six weeks after launching there on August 1, Go-Jek founder and chief executive Nadiem Makarim said.

    “We are proud to have seen positive development in Ho Chi Minh City market, and this paves the way for us to expand our services to Hanoi,” Go-Viet co-founder and managing director Nguyen Vu Duc said at Wednesday’s launch.

    The launch followed an announcement by the company in May that it would invest $500 million to enter the Philippines, Singapore, Thailand and Vietnam, following Uber’s deal to sell its Southeast Asian operations to bigger regional player Grab.

    On Tuesday, Grab announced a partnership with Vietnam’s MOCA Technology and Service company (Moca) for a mobile payment service, as the ride-hailing firm pushes to cement its position.

    The launch was attended by Indonesian President Joko Widodo, who is in Hanoi for an official state visit and a meeting of the World Economic Forum.

    More Indonesian businesses are seeking to expand their operations in Vietnam, Widodo told reporters on Tuesday, after a meeting in Hanoi with his counterpart Tran Dai Quang.

    “We expect bilateral trade to reach $10 billion a year by 2020…and I hope president Tran Dai Quang would work to remove trade barriers for Indonesian products, including automobiles,” he said.

    Trade between the countries rose to $6.5 billion last year from $5.6 billion in 2016, says Vietnam, which exports rice, crude oil, cement and farm produce to Indonesia, and imports fertilizer, oil products, machinery and fabric from it.

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