WBG WANTS INDONESIA
WBG wrote, Indonesia's economy continues to prove resilient with a forecasted GDP growth of 5.1 percent for 2016. But weaker than expected global economic expansion may moderate the growth recovery of Southeast Asia's largest economy, according to a new World Bank report. The World Bank recently lowered its growth projections for the world by half a percentage point than previously expected, to 2.4 percent.
Private consumption and public capital spending are projected to support growth in Indonesia in 2016. Continued policy reforms can help counter the impact of slowing demand and financial market volatility globally.
"Prudent monetary policy, increased public investment in infrastructure, and policy reforms to improve the investment climate, are helping Indonesia maintain growth in the order of 5.1 percent," said Rodrigo Chaves, World Bank Country Director for Indonesia. "But the anemic global economy is limiting much needed investment and continued reforms would help Indonesia to buoy investor confidence."
Numerous policy reforms have been announced since September 2015, with some sectors – in particular, trade and investment policy – witnessing a shift towards deregulation. However, it is not yet known whether effective implementation of policy changes is taking place, and many sectors remain closed or partly closed to foreign investment.
Increased private sector investment is essential for Indonesia, as pressures on public revenue may curtail the government's plans for much more infrastructure investments, which have supported economic growth. However, even with a lower revenue forecast and a larger fiscal deficit of 2.8 percent of GDP, World Bank calculations show that 90 percent of the original 2016 Budget investment target could be achieved.
While private consumption growth remained resilient at 5 percent year-on-year, slowing growth in fixed investment due to reduced government spending has contributed to Indonesia's real GDP growing at 4.9 percent year-on-year in the first quarter of 2016. Weak global demand continues to put pressure on exports.
Faced with the continued decline of the commodities sector, Indonesia can seize the opportunity to expand the manufacturing and services sector. Indonesia's global share of manufacturing has stagnated at around 0.6 percent over the last 15 years.
"This is a critical opportunity for Indonesia to implement further reforms that will enhance the competitiveness of its manufacturing and services sectors, especially tourism. In addition to ongoing reforms, a sound industrial strategy will be key, focused on technology transfer or capacity development in terms of product design, engineering and development in promising industries. To upgrade industries and climb the technological ladder, a strong partnership with the private sector will be crucial," said Ndiame Diop, World Bank Lead Economist for Indonesia.
Currently, Indonesia's manufacturing exports are dominated by 'low-tech' products and operations are focused mainly on blending and assembly, making the country vulnerable to changes in a multinational corporation's location strategy.
|March, 21, 12:50:00|
|March, 21, 12:45:00|
|March, 21, 12:40:00|
|March, 21, 12:35:00|
|March, 21, 12:30:00|
|March, 21, 12:25:00|
BLOOMBERG - The Saudis see atomic energy as a way to ease their dependence on finite fossil fuels. But they are also driven by competition with their rival Iran, which has multiple nuclear facilities.
PLATTS - The Russian energy ministry said there are many pilot projects introducing blockchain to Russia's energy sector in the development and discussion stage, which could have a "potentially significant" impact on optimizing oil and gas companies' costs.
ROSNEFT - Net income attributable to Rosneft shareholders reached RUB 100 bln in 4Q 2017, more than doubling QoQ. In 12M 2017 it amounted to RUB 222 bln, exceeding the 2016 level by 27.6%.
AOG - Total contributed a participation fee of $1.15bn to enter the Umm Shaif and Nasr concession and a fee of $300mn to enter the Lower Zakum concession. Both concessions are operated by ADNOC Offshore, a subsidiary of ADNOC, on behalf of all concession partners.