indonesia-market

Exporting to Indonesia – Market Overview

Do you want to export to Indonesia? Start by using the Country Commercial Guide, a trusted resource for companies at every level of exporting experience. Our guides are produced by trade experts at U.S. embassies and consulates in more than 140 countries. They provide insights into economic conditions, leading sectors, selling techniques, customs, regulations, standards, business travel, and more.

Indonesia is Southeast Asia’s largest economy with a GDP of 932 billion in 2016 (USD), ranking 8th in the world based on purchasing power parity, and averaging over 5% growth over the last decade. Growth is projected by the IMF to reach 5.1% for 2017 due to strong private consumption. President Joko Widodo (known as "Jokowi") took office in October 2014 and has pledged to improve infrastructure, diversify the economy, and reduce barriers to doing business in Indonesia as a means of increasing economic growth.

Over the past decade Indonesia has enjoyed steady economic growth, though less than needed to pull the country into upper middle-income status. Sound macroeconomic policies, combined with growing domestic demand and high commodity prices, propelled economic expansion in recent years, but protectionist policies, corruption at all levels of government, poor infrastructure, weak rule of law, and labor rigidity continue to pose challenges.

Beginning in September 2015, the Government of Indonesia (GOI) announced a series of economic reform packages in an effort to spur its GDP growth and encourage foreign investment. The announced reforms are a positive signal of the Jokowi administration’s desire to improve the business climate; however, the implementation and impact of the policy reforms remains limited. Nonetheless, the Indonesian market has many positive attributes.

Indonesia has a GDP per capita of $3,604 ($11,700 at PPP) that exceeds many of its ASEAN neighbors such the Philippines and Vietnam, and with 258.8 million people (IMF), Indonesia’s economy comprises nearly half of ASEAN economic output.

Indonesia is a thriving democracy with significant regional autonomy. It is located on one of the world’s major trade routes and has extensive natural resource wealth distributed over an area the size of the United States and comprised of 17,508 islands (CIA World Factbook).

According to Euromonitor International, Indonesia has the world’s fourth largest middle class with 17.3 million households as of 2014, and is forecasted to expand to around 20 million households by 2030.

Globally, Indonesians are the fourth largest users of Facebook (87 million, April 2017). According to Statistic, in May of 2016, Indonesia was found to have the third highest number of active Twitter-users in the world, after the United States and India. Also according to Statista, in May of 2017, Indonesia had the fifth highest number of internet users in the world at 132 million.

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