CEOs confident of Indonesian Growth, PwC Survey finds
Most businesses in Indonesia remain optimistic of growth prospects within the next five years, despite lingering anxiety amid global and local economic uncertainty, according to a survey by global consulting firm Pricewaterhouse Coopers.
PwC's 2015 Asia-Pacific Economic Cooperation (APEC) CEO survey, released on Monday, reported that 25 percent of respondents with business in Indonesia remained “very confident” about their prospects in the next 12 months, while 41 percent were “somewhat confident.”
About 44 percent of respondents also still have plans to increase investments in Indonesia over the next year. Indonesia was cited, along with the United States and China, as being an attractive destination for future investment, the survey found.
The survey questioned 800 CEOs and industry leaders across 52 nations with operations in all 21 APEC economies between June and August. Just under 50 respondents came from Indonesia.
“In Indonesia, although there is continued market volatility, the majority of CEOs are confident about their growth over the next three to five years,” Irhoan Tanudiredja, a senior partner at PwC Indonesia, said in a statement. “This is evidence of the huge potential in the Indonesian market, with a growing middle class and the government’s focus on improving infrastructure.”
But Irhoan noted that business leaders were increasingly worried about potential Internet disruptions, including the threat of cyberattacks, as well as natural disasters hitting manufacturing hubs.
The government projects economic growth of up to 4.8 percent this year and 5.3 percent next year. GDP expanded at an annualized rate of 4.73 percent through the third quarter of the year amid weakening global demand for commodities, which makes up the lion’s share of Indonesia’s exports, and persistent market uncertainty.
In contrast to the relatively rosy outlook for Indonesia, PwC noted that optimism for revenue growth is mostly down across the Asia-Pacific region as a whole, showcasing the lowest level of confidence since 2012, mostly due to recent volatility in the financial markets.
“After a year of historically high foreign direct investment into developing Asian economies, APEC CEOs have become very sensitive to financial market signals and the likely impact on revenue growth,” Dennis M. Nally, chairman of PricewaterhouseCoopers International, said in a statement.
“Nonetheless, they are still expanding into new APEC locations. This gives testament to the experience they have gained in managing short-term instability and balancing this against the opportunities to generate business in the region.”