Analysis

Elemental production: Varying tin prices impact local manufacturing output
OBG
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As the largest exporter of tin on the planet, Indonesia has been enjoying a wave of strong demand and rising commodity prices in recent years as regional economic growth has surged. Tin mining companies have been in for a wild ride in 2011, however, as tin prices diverged from those of other minerals and spiralled up and down throughout the year. These uncertain market conditions, combined with…

Analysis

An evolving tradition: Traditional tobacco products continue to lead the segment
OBG
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With its internationally famous clove cigarettes, known as kretek, and an expanding domestic market, Indonesia is a centre for many global tobacco companies. The industry provides employment and income for tens of thousands of people, from growers to hand-rollers and retailers. With an estimated 60% of adult males smoking and a population of 240m overall, Indonesia is also the third-largest market…

Analysis

A matter of choice: Growing disposable income is creating demand for new products
OBG
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Another recent beneficiary of Indonesia’s rapid economic growth has been the consumer goods industry, with domestic demand rising significantly for food and beverage (F&B), pharmaceuticals, cosmetics, textiles and footwear, and tobacco products (see analysis). Exports have also been growing, with the bar increasingly high for Indonesian producers as they seek to meet regulatory and food safety…

Analysis

Gassing up: A renewed focus on producing for domestic consumption
OBG
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In contrast to crude oil production, Indonesia’s natural gas output has been on the rise each year since 2007. Total gas production in 2010 amounted to 3.28bn standard cu feet per day (scfd), up 8.4% on the previous year’s mark of 3.02bn scfd and 16.8% over the 2.81bn scfd in 2007, according to Indonesia’s Directorate General of Oil and Gas (DGOG). According to the “BP Statistical Review…

Analysis

Gold standard: Two companies lead production of gold and copper
OBG
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Interest in the most reliable and safest of metals, gold, continues to bolster commodity prices even as enthusiasm for other metals flag, and Indonesia’s mining companies are keen to capitalise on this. LOWER PRODUCTION: Total gold production for 2010 reached 111,387 kg, according to data from the Directorate General of Mineral and Coal (DGMC), but production in the first half of 2011 did…

Analysis

Into the deep: Firms see greater potential in coal bed methane extraction
OBG
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On March 25, 2011 the Sangatta West project in East Kalimantan was the first dedicated coal bed methane (CBM) well in Indonesia to successfully release gas trapped approximately 830 metres below the surface. The implications of this milestone go far beyond the relatively small amounts of methane gas released from test well SCBM#1, as the country is estimated to house an estimated 453trn cu feet…

Analysis

Back on track: Rail infrastructure is set for a dramatic overhaul
OBG
plus

As part of its new drive to address the country’s historic transport problems, the government is turning its attention to Indonesia’s rail network. The rail system is currently far shorter and more fragmented than its neighbours, with one Trans-Java network and three self-contained lines in Sumatra. Moreover, of the roughly 6900 km of narrow-gauge (1067 mm) lines, only around 4800 km is operational.…

Analysis

Charting a safe course: Domestic fleets work to meet rising demand
OBG
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The advent of new rules on cabotage, coupled with vibrant GDP growth, a strong rupiah and robust domestic consumer demand, has put Indonesia’s merchant fleet under considerable pressure on to deliver. This has resulted in a surge of boat buying by the country’s shipping companies, with financing for this capital expenditure (capex) a going concern for the sector. Thus, 2011 saw initial public…

Analysis

Keeping it green: New environmental initiatives are supplementing building projects
OBG
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In line with global trends, a green-building movement is taking hold in Indonesia. Companies are increasingly looking at the concept. Developers and contractors are taking note and the Green Building Council Indonesia (GCBI), formed in 2009, has published certification guidelines. Among the multiple state-owned building companies, Pembangunan Perumahan has embraced green building, declaring itself…

Analysis

Easing congestion: Getting traffic moving in the Jabodetabek area
OBG
plus

Traffic in the Greater Jakarta region is increasingly slowing down, as the number of vehicles on the roads rise. In 2010 there were 11.3m vehicles in the metropolitan priority area of Jabodetabek (Greater Jakarta), with 1.5m of these in Jakarta alone, according to the Ministry of Transport. The majority of these are two- or three-wheelers weaving their way through traffic. GRIDLOCK: Streets…