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Bappenas Projects Indonesia's Economy to Grow Stronger in 2024

The Ministry of National Development Planning/National Development Planning Agency (Bappenas) projected that Indonesia's economy in 2024 would grow better than in 2023 despite the trend of slowdown in the global economy.

"Several international agencies have stated that Indonesia's economy, amidst the ongoing global economic slowdown, is projected to grow stronger than in 2023," the ministry's Deputy of Economic Affairs, Amalia Adininggar Widyasanti, stated during the 2023 Indonesia Economic Report's launch agenda here, Wednesday (January 31).

The Indonesian government targets the national economy in 2024 to grow by 5.3 percent, higher than the 2023 economic growth projection set at 5.1 percent.

She affirmed that Indonesia has a solid foundation to develop a stronger economy in 2024 despite uncertainty looming over the global economy and its divergence that is expected to continue in the upcoming years.

The official pointed out that the Organisation for Economic Cooperation and Development (OECD) also forecast Indonesia's economy in 2024 to grow better than last year.

"This is a positive sign that the global community believed that Indonesia can recover and maintain its economic growth in the five-percent range, returning to the pre-COVID-19 pandemic growth level," Amalia noted.

Meanwhile, Governor of Bank Indonesia (BI) Perry Warjiyo highlighted the need to remain vigilant while being optimistic in 2024 as well as to enhance synergy between economic policies and efforts to strengthen national economic resilience in 2024.

The central bank projected Indonesia's economy in 2024 to grow by 4.7 to 5.5 percent, provided that internal and external economic stability are preserved.

Warjiyo is also optimistic that inflation would be manageable to the expected target of 2.5 percent, give or take one percent; banking credit would grow by 10-12 percent; and the exchange rate of the rupiah would improve in 2024.

(Read the full article here)

Australia Unveils US$1.3 Billion Fund to Hitch Its Future to Southeast Asia

Australia introduced a A$2 billion finance facility aimed at enhancing trade and investment in Southeast Asia, coinciding with a summit of leaders from the Association of Southeast Asian Nations (ASEAN) in Melbourne. Prime Minister Anthony Albanese emphasized the significance of the region for Australia's future economic prospects. The fund, recommended by Australia’s envoy to the region, will prioritize clean energy and infrastructure projects, with an additional A$140 million allocated to extend an existing infrastructure program.
 
In response to the evolving geopolitical landscape and China's growing assertiveness, Australia has been diversifying its economic partnerships beyond its traditional reliance on China. With bilateral trade surpassing US$178 billion in 2022, Australia sees ASEAN, fueled by population growth, as an emerging economic powerhouse. Albanese stressed the urgency for collaboration, recognizing untapped potential in the region. The summit marks the 50th anniversary of Australia's ties with ASEAN and underscores the need for strategic cultivation amidst China's changing dynamics in the Indo-Pacific.
 
Southeast Asia's burgeoning energy needs, coupled with its role in clean energy initiatives, present opportunities for collaboration. Australia's funding package will support export financing and loans, particularly for infrastructure and renewable energy ventures. Additionally, discussions at the summit addressed regional concerns such as climate change and energy transition. The joint commitment between Singapore and Australia towards cross-border electricity trade signals a move towards renewable energy, aligning with the broader global push for sustainability.

Source: South China Morning Post

Vietnam-Cambodia Business Association to promote investment

Business and trade volume between Cambodia and Vietnam is anticipated to grow, as representatives of the Vietnam-Cambodia Business Association (VCBA) have committed to promoting investment opportunities in the Kingdom to Vietnamese investors.

The pledge was made by VCBA president Leng Rithy during a meeting where he led delegates from 16 companies, most of which are actively investing in Cambodia, to engage with Sun Chanthol, deputy prime minister and first vice-president of the Council for the Development of Cambodia (CDC), at the council’s headquarters in Phnom Penh on March 6.

Rithy stated that the association’s members are keenly interested in Cambodia’s rapid development, particularly the efforts of the government in the new legislature. 

He mentioned that in the past, he and member companies have shared their experiences in investing in agricultural sectors such as rice and rubber in concert with Cambodian farmers and investors. 

He asserted that through effective collaboration with the council, the association is committed to enhancing the visibility of Cambodia’s financing opportunities to a broader spectrum of Vietnamese investors.

“VCBA will work with the CDC to showcase the Kingdom’s potential to financiers in Vietnam, with the aim of attracting them to various Cambodian sectors, especially agriculture,” he stated.

In response, Chanthol expressed his gratitude to all investors who have contributed to Cambodia’s economy and expressed optimism for further growth from existing firms in the country.

To read full article, please click here.



Author: Hin Pisei

Source: The Phnom Penh Post

Thai exports of agricultural and agro-industrial products gain from FTAs

Thailand was able to maintain competitiveness in agricultural and agro-industrial product exports last year due to free trade agreements (FTAs) with partners, the Department of Trade Negotiations said on Sunday.
Thailand's exports to FTA partners was valued at US$167.20 billion (6 trillion baht), down 3% year on year (YoY) due to the global economic slowdown amid inflation, rising interest rates and geopolitical conflicts. Despite a decline in total export to FTA partners, Thailand's exports of agricultural and agro-industrial products expanded as partners offered tax waivers on those products. Agricultural product exports were worth $19.56 billion (702.82 billion baht), up 4% YoY, while agro-industrial products exports amounted to $15.07 billion (541.54 billion baht), up 2% YoY. Thailand's exports to main FTA partners like China and ASEAN expanded 11% and 5%, respectively.
Department director-general Chotima Iemsawasdikul said:
"Thailand is the top agricultural products exporter in ASEAN and seventh globally. And Thailand is third highest agro-industrial products exporter in ASEAN and 11th globally."
She explained that Thailand's export of frozen and dried fruits to FTA partners had expanded by 23% YoY. Among other products that saw export expansion were:
- Rice, by 92%, to countries such as Indonesia, the Philippines and Malaysia
- Frozen chicken, by 19%, to China, Japan and Malaysia
- Coffee, by 43%, to Cambodia, Japan and China
- Sugar, by 14%, to Indonesia, Phillippines and South Korea
- Canned and processed fruits, by 9%, to China, Australia and Laos
- Canned and processed vegetables, by 18%, to Japan, South Korea and China
- Ice cream, by 11%, to Malaysia, South Korea and Vietnam
As a key to boost export competitiveness in the global market, Thailand now has 15 FTAs, covering more than 85% of Thai products.
Sri Lanka is Thailand's latest FTA partner, and more agreements were in the process this year to ensure maximum benefits of the country's export, Chotima said.
 
Source : THE NATION

Indonesia Revises TKDN Target in EVs to Attract More Investment

The Indonesian Government revised the target value for the domestic component level (TKDN) in the assembly of battery-based electric vehicles (KBLBB) to attract more investment and accelerate the KBLBB market in Indonesia.

Director of the Maritime Industry for Transportation Equipment and Defense Equipment at the Ministry of Industry Hendro Martono stated in a press conference here Friday that calculation of the minimum TKDN value of 40 percent, earlier set until 2024, will be extended to 2026. Furthermore, the TKDN composition will increase to a minimum of 60 percent during the 2027-2029 period and a minimum of 80 percent in 2030 and thereafter.

Based on the calculation, the TKDN weight for supporting components remains at 10 percent. Meanwhile, the TKDN weight for development and research activities will be reduced, from 20 percent to 10 percent in 2030, he stated. On the other hand, the TKDN weight for assembly components increased, from 10 percent to 20 percent.

In addition, the government provides various incentives for the electric vehicle industry, including tax holidays, or corporate income tax exemptions for companies producing KBLBB. Moreover, a tax allowance or reduction in corporate income tax is provided for companies investing in the KBLBB industry and a zero percent import duty incentive for imports of KBLBB components, he elaborated. Incentives are also given to consumers who buy two-wheeled electric vehicles in the form of a discount of Rp7 million per unit.

(Source: click here)

Indonesia's Economy Clocked Sound Growth Amid Global Uncertainty

President Joko Widodo (Jokowi) stated here on Wednesday that Indonesia's economy is quite strong and experienced good growth in the midst of global uncertainty.

"We must be grateful, thank God, amid the continuous world crises, the economic uncertainty that is difficult to calculate, our economy is quite strong, and among the G20, in the top three economies with good economic growth conditions," the president remarked at the Military-Police Leaders Meeting.

Jokowi noted that Indonesia's economy in 2023 had grown by 5.05 percent, with inflation remaining under control at 2.57 percent.

Furthermore, Indonesia's poverty rate declined to 9.36 percent, the unemployment rate fell to 5.32 percent, and the Gini ratio also declined to be at 0.388 percent.

"Even though we see good numbers, I continue to remind that we must be careful, we must stay vigilant, because, going forward, global competition will become more complex. The direction will become more unclear,” he remarked.

He further stated that the conflicts in Ukraine, Gaza, and Yemen also contribute to the increase in food inflation.

Those conditions have caused several countries to apply protectionism policies for their food commodities.

The president stated that there are around 1,348 food-related protectionism policies applied by countries in the world. The figure showed a threefold increase as compared to 2014 and is projected to continue to rise.

“We know that back then there were many that offered us, for instance, rice. Now, we are looking for rice in producer countries. It is not easy,” he remarked.

He pointed out that countries had halted the exports of food items, both wheat and rice, due to climate change and disruptions in supply chains.


(Read the full article here)

Innovation, critical enabler of transformative climate action: ADB-UN report

Innovation which takes different forms, including the application of new business models, is a critical enabler of transformative climate action, according to a report released by the Asian Development Bank (ADB), United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), and United Nations Development Programme (UNDP).

The report, People and Planet: Addressing the Interlinked Challenges of Climate Change, Poverty, and Hunger in Asia and the Pacific, said innovation can also occur through the production and consumption practices, the way policy is implemented, or novel ways in which firms use technological advances.

It said science plays a big role in advancing innovation, for instance by creating new crops and farming techniques, or new climate resilient infrastructure and circular economy solutions.

“The financial sector and payment systems are also changing rapidly. In many cases, innovation in one area necessitates new ways of doing things in other areas,” it added.

The report cited as an example food systems new climate-resilient crops which call for a host of complementary innovations for the crops to become viable.

These can include sensor-based irrigation systems, financial innovations that allow farmers to use new equipment and services, or shared or pooled access processing facilities and refrigerated transport, it said.

“Governments can provide broad encouragement for innovation ecosystems by creating an enabling environment that connects finance, technology, business, and customers,” it added.

It further cited some of the recommendations in the 2023 Global Stocktaking Technical Synthesis report which are relevant for the region, such as the need for rapid deployment of existing clean energy technologies, including through technology transfer agreements.

The report said multilateral and bilateral technology transfer can help countries scale up their renewable energy and associated technology supply chains.

“Mechanisms to facilitate the process can include joint research and development projects, or technology transfer and capacity building projects that involve research and academic institutions, companies and the public sector,” it said.

The report said international organizations and multilateral development banks are in a good position to provide technical assistance for developing clean energy supply chains, especially if the assistance is aimed at stimulating deeper innovation systems capabilities in the region.

“The needs for such assistance will vary, as each country and region has their own transition scenario,” it added.  

Apart from innovation and entrepreneurship, other key enablers of transformative change include education, awareness raising and skill development; policy coherence; institutional capacity building; finance, funding and investment; and regional cooperation and multi-stakeholder partnerships.

Enhancing tourism exports in Asia and the Pacific pushed

Economies of Asia and the Pacific can enhance tourism exports in the region through investments in creating tourism infrastructure, business facilities and human resources, and developing specialized policies for tourism exports, according to a report released by the Asian Development Bank.

This, as island economies are highly dependent on tourism services for their gross domestic product, exports and employment generation, said the report which analyzes tourism in Asia and the Pacific as a services export industry.  

The report said governments in the region should create a policy framework to attract and facilitate domestic and foreign investment for building tourism infrastructure. 

“They must undertake investment facilitative measures to build more tourism and transport infrastructure,” it said. “These measures could include investment incentives in the form of tax holidays for specific periods, import duty concessions for goods used in the tourism sector, such as luxury transport vehicles, hotel equipment, furniture, etc., and easier land transfer and registration procedures, among others.” 

Apart from investment in the traditional tourism infrastructure, the report said domestic and foreign investment in business facilities, such as convention centers, would also be useful in creating an alternative pool of international travelers: business tourists.

Investment to create business tourism infrastructure can be facilitated through fiscal and tax incentives as well as through binding commitments in trade agreements, it added.

The report also underscored the importance of investment in the human resources involved in various tourist activities. 

“Professional and skilled resources will help economies create a positive brand image for greater tourism. Therefore, governments should be proactively involved in imparting training to various tourist service providers,” it said.

The report added it is imperative to update existing skills among tourism service providers as digital tools and technologies spread.

“This would involve training employees and service providers to comply with online etiquette, security of digital payment methods, and ensuring the data privacy of the travelers,” it said.

Further, the report recommended developing dedicated policies for tourism exports promotion as most economies in the region have generalized policies for the sector.

“Governments may consider specialized policies focusing on tourism exports. Such policies may have export-linked subsidies and incentives for this sector,” it said. 

To enhance tourism exports in Asia and the Pacific, the report also underscored the need to develop alternative tourist destinations, use digital tools and technologies for enhancing tourism offerings, easier tourist visa policies, tourism enabling policies in other sectors, diversifying sources of international tourists, and branding and marketing campaigns.

 It said alternative tourist destinations need to be systematically developed with government support for infrastructure development, training, and skilling of the local population. 

“Government support measures could also include offering financial incentives to budding entrepreneurs for developing tourism in specific rural areas to showcase the traditions and culture of that place,” it added.

President Jokowi Expects Increased Investment after Peaceful Elections

President Joko Widodo forecast an increase in capital and investment flow into Indonesia after the peaceful February 14 general elections. He acknowledged that many businesspeople were still waiting for the elections' results but he was confident that the elections went smoothly, and people were happy to vote. He emphasized the importance of political stability in supporting inclusive and sustainable economic growth.

Jokowi underscored the resilience of the Indonesian financial industry, with banking capital levels reaching 27.69 percent and banking credit growing 10.38 percent year on year, or above the pre-pandemic level, amid the global geopolitical situation with ongoing wars in Gaza and Ukraine. He also highlighted Indonesia's economic growth at 5.05 percent and controlled inflation at 2.57 percent.

Indonesia's foreign exchange reserves amounted to US$145 billion, the trade balance recorded a surplus of US$36 billion, and the current account deficit was a surplus of 0.16 percent, he stated. To foster an inclusive and sustainable economy, Jokowi encouraged the Financial Services Authority (OJK) to strengthen financial inclusion and literacy, which were still at 75 percent and 65 percent, respectively, in 2023.

(source: click here)

With increased digitisation, Asia-Pacific’s micro businesses have shifted to growth mode

Small and medium businesses (SMBs) are a vital lifeline of the global economy. Worldwide, they represent 90 per cent of businesses and 50 per cent of employment and are often the cornerstones of growth and innovation.

In Asia-Pacific, their impact is even bigger. SMBs account for over 97 per cent of all businesses and employ over half of the workforce across Asia Pacific Economic Cooperation economies. They contribute significantly to economic growth, with their share of gross domestic product ranging from 40 per cent to 60 per cent in most countries.

Asia Pacific’s micro-businesses are also on the rise, with a new generation of digital-first micro-businesses that includes millions of creative individuals in the fast-growing creator economy.

Small businesses have shifted firmly into growth mode. Increased digitisation in key areas like services, logistics and payments has enabled this segment to reach new audiences and improve efficiencies.

Such payment advancements have allowed small businesses to access markets and opportunities that were not previously possible.

Here are five reasons why 2024 is shaping up to be a huge year for small businesses:

Rise of social commerce and the creator economy

By 2025, social commerce is expected to reach US$1.2 trillion, including work driven by a new generation of digital-first online content creators.

This trend is further propelled by shoppable media and influencer content, empowering SMBs to engage consumers to make purchases directly through social media platforms or navigate to brand sites.

About 54 per cent of consumers are more likely to purchase from an SMB through social commerce than through traditional e-commerce, indicating a significant opportunity for SMBs to increase their sales through social commerce.

Growth through cross-border selling

Technology and globalisation have upended the SMB landscape by providing them unprecedented access to global audiences. In fact, 79 per cent of surveyed SMBs by Visa expressed a strategic focus on cross-border selling for their growth initiatives.

The proliferation of e-commerce platforms, particularly in the Asia-Pacific region, also plays a pivotal role.

With integrated payment systems seamlessly connecting buyers from Switzerland to sellers in Sri Lanka, the prospect of selling to consumers on the opposite side of the globe is no longer a distant aspiration for SMBs.

The accessibility offered by these platforms diminishes geographical barriers, expanding the horizons for micro businesses and fostering a more interconnected global marketplace.

Small businesses take flight with travel rebound

SMBs are vital to the travel industry, making up 80 per cent of businesses in the sector, and they directly benefit from the post-pandemic travel rebound.

With business travel expected to surpass pre-pandemic spending levels in 2024, SMBs across food and beverage, tour guides and home-share operators should be well-positioned to capitalise.

To fully harness the potential of this travel rebound, SMBs should not only focus on optimising their payment processes but also tailor their offerings to meet the evolving needs and preferences of the post-pandemic traveler.

This includes embracing digital payment methods favoured by modern travelers and implementing secure and efficient transaction systems.

Moreover, by ensuring their systems can accept payments from inbound tourists, businesses pave the way for the next crucial step in enhancing their financial capabilities – embracing payment interoperability.

Payment interoperability, acceptance are top priorities

In a landscape where user experience is king, SMBs must prioritise offering a seamless and secure consumer payments experience.

It is particularly critical to address potential points of friction in the payments process because users may abandon their online shopping cart if faced with difficulties in completing their purchase leading to missed opportunities that SMBs can ill-afford.

SMBs today have a multitude of options for receiving payments, ranging from digital wallets and cards to account-to-account transfers.

In order to thrive in this evolving ecosystem, SMBs must prioritise implementing a compelling and user-friendly checkout experience, and partner with banks and fintech providers that offer advanced technologies to do so.

In addition, ensuring the safety of transactions with technologies such as tokenisation, biometrics, EMV chips, and predictive analytics play a crucial role in fortifying security measures, providing SMBs with the necessary tools to safeguard their financial transactions and customer data.

Big tools no longer just for big businesses

While SMBs typically adopt a gradual approach to digitalisation, unlike larger companies who are pack leaders, this is set to change.

Over the next year, 91 per cent of SMBs said they are at least somewhat likely to consider available AI tools and services such as ChatGPT to help elevate their business against competitors.

This shift will not only help them reach new audiences but also improve their overall agility in streamlining their processes, enhance efficiency, and stay competitive.

The confluence of these trends signifies that 2024 is the opportune moment for small businesses to leverage digitalisation and payment innovations. Payments are no longer just transactional; they have become an integral part of every business’ strategy for success and resilience.

As small businesses embrace these transformative shifts, they are not merely adapting to change. They are positioned to thrive and redefine the future of commerce on a global scale.

The writer is Visa’s head of merchant sales and acquiring, Asia-Pacific.

Source: The Business Times.  Link: Here

Over 400,000 tourists expected in 2026

In the short term, the tourism industry in the Sultanate anticipates that there will be over 400,000 tourist arrivals by air in 2026, bringing in an estimated BND300 million in tourism receipts from the arrivals.

Acting Director of the Tourism Development Department at the Ministry of Primary Resources and Tourism (MPRT) Salinah binti Haji Mohd Salleh said this during a presentation ceremony, held by the MPRT through the Tourism Development Department, to honour Bruneian recipients of the ASEAN Tourism Standards Awards, at its premises.

“To achieve these targets, we are working closely with current and new partners to explore new markets and launch new and improved products and packages,” she said.

The prestigious recognition was bestowed on Brunei’s entities in conjunction with the ASEAN Tourism Forum 2024 (ATF 2024), themed ‘Quality and Responsible Tourism – Sustaining ASEAN Future’ held on January 26 in Vientiane, Laos.

Permanent Secretary at the MPRT Hajah Tutiaty binti Haji Abdul Wahab was the guest of honour at the event.

“One of the Tourism Development Department’s initiatives was to organise the first Tourism Service Providers (TSPs) Enhancement Workshop that began in February last year,” Salinah said.

Source: Borneo Bulletin Read the full article here

Awards celebrate local businesses

The Proudly Brunei Business Awards, a newly introduced initiative by the Brunei Economic Development Board (BEDB) through Darussalam Enterprise (DARe), concluded its inaugural edition with an award ceremony at Tarindak D’Seni in Bandar Seri Begawan last night.

Deputy Minister of Finance and Economy (Economy) Dato Seri Paduka Haji Khairuddin bin Haji Abdul Hamid, the guest of honour, presented awards to the winners.

BEDB and DARe Acting Chief Executive Officer Daniel Leong said, “The Proudly Brunei Business Awards marks a milestone in our journey towards recognising and celebrating excellence within Brunei’s business community. Through the awards, we firmly believe that by recognising and honouring outstanding achievements, we not only celebrate business successes but also inspire more business to pursue the spirit of innovation and excellence.”

The awards were presented to the winning companies across seven award categories. In the open category, A Ayam Berjaya Sdn Bhd won the business growth award, Poni Group Sdn Bhd the innovation award, GoMamam the startup award, BWN Design Enterprise the youth entrepreneur award and Taurean Bakeshop and Cafe the women entrepreneur award.

In the priority clusters category, SPHI Foods won the food award and Poni Group Sdn Bhd the services award.

This year’s theme ‘Catalysts For A Better Tomorrow’ is a tribute to businesses that achieved growth while making significant contributions in their sectors.

The theme emphasises the role of businesses as catalysts for positive economic change, focusing on priority areas.

It seeks to honour companies that serve as role models, contributing to the development of the local economy and paving the way for a promising future for Brunei. At the heart of the awards is a thorough assessment and evaluation process, which involves various subject matter experts from government agencies and organisations.


Source: Borneo Bulletin

Read the full article here

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