Southeast Asia's largest economy is putting the downturn in commodities behind it. President Widodo's government is implementing free market-oriented measures and reforms, presenting the country as a symbol of political stability and economic dynamism and attracting foreign investors. The direction taken leads us to believe that this is the right time for Italian companies that want to export their products to Indonesia, make investments or participate in the development of the country by operating locally and taking advantage of the numerous projects planned by the government.
Opportunities come from the infrastructure sector which needs "... 500 billion USD in investments within the next five years", according to Jim Yong Kim, president of the World Bank. Roads, ports, airports but also the production and distribution of energy from both traditional and renewable sources. Among the infrastructures to be implemented there is also the digital one, which is important both for developing an internal market for the destination of goods and for making production processes more efficient.
Greater efficiency and growth in productivity also depend on the importation of technology from abroad, especially mechanical engineering goods. This can play a very important role in the mining industry and related industries, given the government's willingness to develop a local industry for processing the extracted minerals, as well as in the manufacturing and agricultural sectors, which still use outdated techniques.
Almost 60% of the Indonesian GDP is made up of domestic consumption and the urbanization process will lead 70% of the population to live in urban centers by 2030, the year in which the consuming class could reach 140 million people, the largest in the Southeast Asia. The automotive sector can be a sector to focus on both in terms of target market and in terms of direct investment on site, given that most of the production is destined for the domestic market.
Italy is starting to grasp the importance of Indonesia, including it among the target countries identified by the "Control Room".
SACE and SIMEST have included the country in the 15 priority geographies for Made in Italy by offering both direct support, with credit risk coverage on payment delays or to protect local investments, and indirect support through guarantees on loans to importers locals. Through this "push strategy" we want to encourage the Indonesian importer to choose Italy as a supply market, offering a financial package that makes the transaction competitive with the Italian exporter.
