Indonesia Shipping Report Q4 2014, New Report Launched

With the general elections now completed and Joko Wikodo poised to take over from President Susilo Bambang Yudhoyono, political risk factors are beginning to subside and BMI retains a broadly optimistic outlook for the Indonesian economy. That said, we consider 2014 to be a relatively weak transition year prior to the recovery gathering pace in 2015. First quarter growth slowed to 5.2% year-on-year and we expect some further weakening because of the government ban on raw mineral exports and lower investment inflows. The mineral export ban is supposed to encourage more processing inside Indonesia, but we believe few international companies will make the major refinery and smelter investments required, and that the policy will be growth-negative.

That said, President-elect Wikodo was clearly the more marketfriendly of the two main presidential candidates, so business sentiment will be improving. We also think monetary policy will become more pro-growth. Considering all these factors, we are maintaining our forecast for 5.1% GDP growth in 2014, with the rate picking up to 6.0% in 2015 and 6.3% in 2016. Our shipping and ports forecast for 2014 shows a significantly slower pace of growth, as the economy cools.

We have also cut back the scale of the expected recovery in foreign trade, which we now see edging up only marginally this year. Over the medium to longer term, we continue to believe that the key to sustainable growth is investment in port infrastructure, including road and rail links in the hinterland areas. We are encouraged to see some evidence of progress on this front.

Spanning over 110 pages, “Indonesia Shipping Report Q4 2014” report covering the Industry Forecast, Market Overview, Company Profile, Macroeconomic Forecasts.

Know more about this report at – http://mrr.cm/ZDV

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