Indonesia - Export Britain

Export Britain

Indonesia

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Ease of trading across borders

Importing a standard container of goods into Indonesia requires:

7documents
23days
£407

Introduction

Indonesia has the largest economy in Southeast Asia and is one of the emerging market economies of the world; it is also the world’s fourth most populous nation and is a member of the G-20. The country has been undertaking wideranging reforms to address various structural weaknesses and improve competitiveness including improvements to regulatory efficiency and creating a more vibrant private sector.

Economic snapshot (% annual growth rate)

201420152016-19
GDP 5.0 4.8 5.5
Export of goods and services 1.0 -0.6 3.9
Import of goods and services 2.2 -5.6 4.3
Inflation 6.4 6.4 4.3
Exchange rate (per £) 11,850 13,394 14,470
Population 1.3 1.2 1.1
Source: Oxford Economics

Economic outlook

In 2012, the Indonesian economy slowed down to a 6.2% GDP growth due to weak export figures due to depressed global demand and a slowdown in domestic consumption. The country's first annual trade deficit of $1.6 billion USD (Statistics Indonesia) also put pressure on the Rupiah causing a 6% slide, making it the worst performing Asian emerging market currency in 2012. The core pillars of economic growth are relatively sound fiscal and macro-prudential management, political stability, a growing middle class and vast natural resources.

Trade outlook

Indonesia’s intra-regional trade has picked up strongly in recent months, but exports to China, the US and the EU have continued to fall. Trade within Asia will be Indonesia’s fastest growing source of growth. China, India and become prominent trade partners overtaking Japan does. Exports to the Middle East and North Africa region are also expected to witness solid growth. Indonesia import needs will rise rapidly, both in terms of capital goods for infrastructure and consumer products for the domestic market. Vietnam and India will be Indonesia’s fastest growing import partners.

Cultural tips

Essential Customs tips

The de minimis value is $50USD, however customs may evaluate if shipment weight is >20kg. Duty (at 0% to 20%), VAT (at 0% to 20%), and income tax (at 2.5% to 15%) are applied separately. If the receiver provides a tax number, income tax will be charged at 7.5%. If the receiver provides a tax number & import identification number, income tax is reduced to 2.5%

With the demand for quality goods increasing, businesses shipping clothing should note that up to ten items per shipment can be sent to Indonesia before registration for additional requirements need to be fulfilled. Only two mobile phones can be sent to Indonesia before the receiver must be registered with the Indonesian authorities.


SWOT analysis

Strengths
Low public and external debt levels
Weaknesses
Infrastructure bottlenecks
Opportunities
Urbanisation
Rapidly growing productive population
Threats
Weakening currency
Inflation

Indonesia's trade with the UK

Sector segmentation growth

Sectors to watch:
  • food 
  • electronic components & boards
Manufacturing
  • repair & installation of machinery, 
  • soaps, detergents etc 
  • utilities.

Fastest-growing exporters into Indonesia

Rank2012
1 Mexico
2 India
3 Egypt
4 China
5 Korea
6 Vietnam
7 UAE
8 Malaysia
9 -
10 -

Total merchandise trade - Leading import partners

Total merchandise trade - leading import partners
Opportunities for UK businesses

Important opportunities exist in mining and agribusiness equipment and services, telecommunications, education and professional training, research, medical equipment and construction, as well as food and drinks.

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