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3,050 Posts
Discussion Starter · #1 ·
May 24, 2008

A new investment frontier
China and India certainly won't be running out of steam soon, but these countries are already emerging and are off to a great start. To capture the even more exciting early years of initial growth, you need to find economies that possess characteristics that point toward becoming the next emerging market.

While not as prominent as the BRIC foursome of Brazil, Russia, India, and China, investor buzz is starting to collect around tiny economies such as Vietnam, Indonesia, and Bulgaria. Dubbed as the "Frontier Markets" by the Barra Index, these economies are just beginning their development stages; they hold less than 1% of the money invested in stock markets worldwide.

But that will all change soon. Goldman Sachs anticipates that Indonesia and Vietnam will be two of the 15 largest economies. And looking at the accomplishments of past emerging markets, the prospects are enticing. According to a recent Newsweek article, the current major emerging markets, including China and India, also held fewer than 1% of worldwide stock market money back in 1987. Today, that share has increased to 12%.


3,050 Posts
Discussion Starter · #5 ·
Currently, our economy is waaaay better than Vietnam and Indonesia is
much more developed than vietnam but the thing is why would he predicted Vietnam to be par with us in the near future???:bash::bash:

however looking at our gdp there is no doubt that they would never overtake us not even in hundred years:lol::lol:

4,671 Posts
^^ iya tapi sayang di mata dunia Vietnam yg rising setelah Chindia (China India) bukan Indonesia gara2 mereka economic growthnya 7%an >(

HRH Prince of Woles
Hogwarts Groundskeeper
13,629 Posts
^^ dulu kan kita juga udah disebut-sebut :) me personally, dun think that Viet will be a bigger economy than us.. :) malah Phillipine yang g rasa bisa nyalip Malay, Sing, Thai. Tapi ya Filipin govt nya masi kaya begitu , ya jauh bara dari panggang deh :)

cmon...our future is bright, i mean very bright...we have to support govt. Tetap optimistis!!

Jangan demo da kerjaan, kalo udah biki rusuh. anarkis, bla bla bla...

BBM naik , Demo. Dikit-dikit demo, dikit-dikit demo, demo ko cuma sedikit... :D

holla holla hey!
3,280 Posts
I like it when ppl look down on Indonesia, all we have to do is prove them wrong ;)

and maybe one of these days we can come up on top and no one will be expecting it.

Indonesia Bisaaa!!

6,022 Posts
Time for Goldman to Add Indonesia to the BRICs: William Pesek

Commentary by William Pesek

May 28 (Bloomberg) -- Muhammad Lutfi dreams with the BRICs.

The head of the Indonesian Investment Coordination Board still scratches his head over why more money isn't rushing into Southeast Asia's biggest economy. Why, he asks, do Brazil, Russia, India and China, the so-called BRICs, get more attention?

``I was shocked a few years back to see that Indonesia was not a BRIC,'' Lutfi said on May 22 at a EuroMoney conference in Bali. ``It should be.''

Lutfi's views have a rose-colored-glasses feel that can seem excessive, yet the point is worth considering.

Economist Jim O'Neill of Goldman Sachs Group Inc. created a sensation when he coined the acronym in 2001. It referred to the four countries that would join the U.S. and Japan as the biggest economies by 2050. Another widely cited report, ``Dreaming With BRICs,'' followed in 2003.

Events in Yekaterinburg, Russia, this month show how much the BRICs concept has taken off. Booming growth is forging a sort of political alliance. On May 16, foreign ministers from Brasilia, Moscow, New Delhi and Beijing met for the first time outside the venue of the United Nations.

The BRICs summit was a milestone for the developing world and served as a reminder of the coming multipolar global economy -- one that's less reliant on the U.S.

Global Shakeup

The $13 trillion U.S. economy still dominates the global system. Yet the rise of the BRICs is shaking up the international economy as perhaps never before and driving investment trends.

In 2007, the combined gross domestic product of the BRICs accounted for 12 percent of global growth, up from 8 percent in 2000, according to the International Monetary Fund. At the time the BRICs held their debut summit, their stocks had risen 70 percent in the previous two years, versus 42 percent in emerging markets overall.

Now investors are looking for the next generation of growth stars -- the next BRICs. Goldman's list includes Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, the Philippines, South Korea, Turkey and Vietnam.

A BRIC nation is one with the potential to become a vital economy and turn that promise into reality. The criterion includes macroeconomic stability, political maturity, openness of trade and investment policies, and quality of education.

Indonesia's Promise

O'Neill says that if he were to sit down tomorrow and revise the BRICs, Indonesia would fare reasonably well. ``Of them, we would rate Mexico as closer to a BRIC status than Indonesia, but it would not be far behind.''

That should be a message for Indonesian officials. The same may be true for investors. For all the excitement over Vietnam, you don't see Indonesian stocks down 55 percent this year like the Ho Chi Minh City Stock Exchange.

``This market is underreported on by the media from a global perspective and rather misunderstood,'' says Jack Lin, Hong Kong- based regional managing director for Franklin Templeton Investments.

Adds Mira Arifin, who heads Indonesia coverage for Lehman Brothers Holdings Inc.: ``It's important to remember how far Indonesia has come in the last 10 years -- political stability, economic stability and investors are returning.''

Both Lin and Arifin stress Indonesia isn't an easy place in which to invest. It requires patience, disciplined research and a strong stomach given the lack of legal protection, the multitude of regional taxes and fickle politicians.

Poverty and Corruption

Surging food and energy prices complicate things further. About 37 million of Indonesia's 243 million people survive on $18 a month. Within the world's fourth-most-populous nation is a population the size of Poland's living on about 60 U.S. cents a day at a time when inflation (9 percent) is growing faster than GDP (6.3 percent).

That factoid alone would scare away many investors. And while the government is working to stamp out corruption, far more needs to be done.

Indonesia's regulatory regime, bureaucracy and legal system need considerable work. With 29 percent of the population under the age of 15, investing more in education is critical. So is spreading the benefits of growth.

Yet it's Indonesia's potential and vast natural resources that are attracting interest from the likes of Reliance Power Ltd., the energy company controlled by billionaire Anil Ambani, and ArcelorMittal, the world's largest steelmaker.

About Implementation

ArcelorMittal Chief Executive Officer Lakshmi Mittal, listed by Forbes magazine as the world's fourth-richest man, plans to spend as much as $10 billion on projects in Indonesia. China Shenhua Energy Co., China's largest coal producer, also is considering opportunities, as are Kuwait Energy Co. and Japan's Mitsubishi Corp.

``Indonesia knows where it wants to be, and investors know where they want it to go,'' says James Bryson, Jakarta-based director at HB Capital Indonesia. ``The issue is implementation.''

President Susilo Bambang Yudhoyono announced on May 26 that Indonesia is offering about 200 investment projects valued at almost $19 billion. It's vital that officials continue to improve the economy and increase transparency so that investors don't regret it.

One payoff will be a seat at BRIC summits. A more important dividend is one of the world's most promising economies finally reaching its potential. Otherwise, Indonesia can keep dreaming.

(William Pesek is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: William Pesek in Nusa Dua, Indonesia, at [email protected]

Last Updated: May 27, 2008 14:01 EDT

1,312 Posts
Good article

Indonesia remains largely invisible because of the fact that it is too big for foreigners to know.
And if Indonesia gets media attention it is about discrimination, terrorism, poverty and or natural disasters.
So how can investors be attracted?
The key is marketing and promotion. Not on national level but on provincial or regional level. Why? Every region/province has it own attractiveness for tourist and investors alike. If the emphasis is done on Indonesia as a whole the investment opportunities of the individual provinces will become less visible and investors might loose the oversight. It is important to seperate the provinces that are interesting for investors from the provinces that are not. By doing this Indonesia's investment opportunities are much easier to identify.

Although not really appreciated by many indoctrinated politicians the future of Indonesia will be much brighter if the provinces will be able to promote and set out policy more autonomously.

30 Posts
^^^^ i agree with u so much.. perbandingan pribadi gw

USA vs England =
Indonesia vs Malaysia

In a lot of ways, perkembangan negara kita bakal mirip sm USA vs England deh. liat donk entertainment, budaya, dan sebentar lg pastinya development bakal nyusull..

Org jiran sebelah kyknya juga lebih conservative dibanding dengan kita, sama ja kyk England wayy lebih conservative dibanding US.

=) :cheers:

Pengguna Jelata
2,814 Posts
BRIICs, world leaders in trade openness and growth
Riyadi Suparno , THE JAKARTA POST , PARIS | Fri, 03/20/2009 12:03 PM | Business

The world’s largest high-growth emerging economies are falling into the trap of protectionism amid the global crisis and they seem to forget that they have been prospering as a result of their relative openness to international trade and investment, according to an OECD report.

The report by the Organization for Economic Cooperation and Development (OECD) released in Geneva Thursday focuses on the world’s largest high growth emerging economies of Brazil, Russia, India, Indonesia, China and South Africa, which the organization calls the BRIICs.

The organization noted in the report that the mistaken notion that the current economic crisis was the result of free trade and market failure had led to an anti-market backlash and calls for protectionism, including among BRIIC countries.

Douglas Lippoldt, acting head of Development Division at the Trade and Agricultural Directorate at OECD, told reporters in Paris on Thursday that “times of crisis are also times of opportunities.”

“Trade protectionism is not the way to tackle the current crisis. All countries, including OECD members and BRIICs, should try more than ever to keep the international market open in order to improve economic prospects for all,” he said.

The report shows that all the six BRIIC countries were champions of free trade and market liberalization, but their openings to the market — except for China — have stalled.

In Indonesia, trade liberalization measures imposed by the International Monetary Fund following the financial crisis in 1997-98 have not been reversed, but there has been creeping protectionism in agriculture, textiles and steel, mainly through tariff barriers.

In Brazil, there was virtually no trade liberalization in the years since tariff reductions were introduced in the late 1980s and mid-1990s.

In South Africa, external trade liberalization has stalled since the 1990s and skepticism about liberalization has set in.

India is by far the most protected country among the BRIICs, with relatively higher average tariffs.

Russia is now in the process of accession to the WTO, but negotiations have been protracted and “stop-go” with no indications of being concluded in the near future.

OECD suggested that BRIICs pursue market openings through multilateral mechanisms under the WTO rather than through preferential free trade agreements because FTAs may only create complications for business and for the development of multilateral rules.

OECD also noted that these six BRIIC countries excelled in opening their borders to global trade, but were still struggling to liberalize their own domestic trade and investment, or what the OECD called the behind-border reforms.

Domestic reforms in service regulations, regulation of technical standards, intellectual property rights, public procurement rules, customs administration and competition rules are a key challenge in all the BRIIC countries.

In Indonesia, the biggest problems still include labor rigidity and impediments to investment, both domestic and foreign investment.

OECD picked these six emerging countries and made an update on them in this report on the BRIICs because of their growing and leading influence in the world economy.

The BRIIC concept is an extension of the idea of the original BRIC group. Goldman Sachs predicted that Brazil, Russia, India and China (the BRICs) would become a larger force in the world economy over the next 50 years and could become larger than the G6 (US, Japan, UK, Germany, France and Italy).

OECD then included Indonesia and South Africa in recognition of their economic size, relative to other OECD members.

Leaving aside oil-rich Saudi Arabia and two other large emerging OECD economies (Mexico and Turkey), the BRIICs are by far the largest economies in the developing world in transition, and the only countries in this category with gross national incomes of over US$200 billion per annum.
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