INDONESIA’S ECONOMY OUTLOOK 2011: DO WE HAVE WHAT IT TAKES.

With positive domestic economic growth about 5,9 % up to the end year according to head of Bappenas ( State Economic Development Office) Mr Armida Alisyahbana compare to  target figure of 5,8 %. Positive outlook for  the year 2011 should embrace Indonesia more. Let we sort out what kind of positive ground that we secured with:

·         With the European and America still struggling to recover from Economic crisis and over debt. Emerging market in Asia turn out to be good investment place for global investor with the  forecast  that these positive swing will last 2 years or subject to how fast western world recovery. Although these flooding capital could suddenly reverse but it help Asia and off course Indonesia to sprung positive outlook climate within context

·         I should said as the world fourth largest population after India then we are blessed with strong domestic consumption. So although our export market was hardly hit by western negative growth but the impact would not significantly.

·         With the almost conformity that next year we should secure investment grade status definitely it will drew more investment climate for us.

·         Domestic politic could be consider steady as the current government of SBY smoothly secure second round chapter so at least investor will assured not much internal changes in respect of economic program.

Now for the future itself, what sort of figure what we can expecting beside optimist economic growth about 6 to 6,5 % estimated by Central Bank. But I will point out more on the macro qualitative forecast for Indonesia in year 2011 as well with some note that we all should addressed.

First, Economic growth will be supported by strong demand domestically since export growth will be steady same with last year and could lower depend on the global market.  Demand from China as world economy power horse did help on our GDP with significant growth on trade balance (more than 300 million per year),

Secondly, other sector that will leading as economy growth catalyst will rank from as Coall, property development, and retails . Pointing out coal as we are no longer able to provide oil domestically for our consumption then heading toward coal as energy most likely will be viable option yet also the price of coal in world is rise as domino effect of the rise of oil per barrel. Then for property or estate itself with the raise of economic it should increase the demand for housing development within last five year property remained as crisis proof investment already coupe with huge demand from market specifically for area in greater Jakarta such as Tangerang, Bekasi and Depok. Last but not least with the growth economic will automatically pulled consumption growth as well from 327 million people as promising market.

Now beside all the good stuff  for future. Internally Indonesia should also tried to be more seriously tackling off the few old  problem that long has been become sickness that impede the economic potential capacity. There are three problems that whom which don’t know whether is matters of lack of capacity to overcome it or lack of commitment from government actually. First will be high logistic cost for good and service across islands not to mention fraud and corruption fee. Most of the major province road are severely damage yet unsafely and capacity of Jakarta International container port to handle transshipment of goods is still remain low the alternative harbor are just a few.  Secondly we are in the verged of electricity power shortage as our state electricity producer aka PLN has not been able to provide power to the demand from both industrial and private. Major infrastructure as part of government obligation are still facing funding and administrative challenges within  to be realized such as new international port, major toll connecting Java from west to east, new power plant with gas powered based as energy alternative instead of oil . It should be calculated that government expenditure should contribute 30 % of economic growth. Last but not least without providing good investment environment and clear regulations in year 2011 we shouldn’t expecting to reach potential benefit from the Asia  economic booming.

Chance is good to whom that prepared otherwise it would another promising story