“Selling” Indonesian Good Stories
When Sumit Dutta arrived in Indonesia three years ago, he was surprised with
How much potential Indonesia offered for growth and business. Yet, he sees there are challenges for Indonesia to move faster to be able to compete in the global market. As a banker, Sumit Dutta feels that he and HSBC can become key players in the development process. Imagining Indonesia 2045, for Dutta is an interesting task, but one certain step he would take is to start now by selling Indonesian good stories.
Here is the beginning of the good stories: Indonesia today is the 16th largest economy in the world. It has 45 million people in the consuming class, 55 million skill workers, and US$4.5 trillion worth of opportunities in areas like services, agriculture, and fisheries. “Speaking of GDP per capita and distribution of the public sector in the last ten years, Indonesia sits third behind China and India,” he noted.
In the past, Asia’s power lay as a trading block, as a result of Asian countries working together. Asean was not formed as a trading block although it has been moving in that direction. “Today more and more people are talking about Asia; about the emerging economies; rising capital, and a growing market. The economic outlook is extremely goo for the future. When Asean becomes a powerful trading block, the country that stands to benefit most is Indonesia because Indonesia is the largest country in Asean. It contributes 37% of Asean GDP and has 40% of Asean’s population,” said Dutta.
All the indicators that point to sustainable growth are evident; Indonesia has the lowest debt rate to GDP ratio among its Asean peers, which basically means Indonesia is one the safest countries in the world today to invest in; Indonesia is a rich country in terms of palm oil, coconut oil, rubber tin, and other significant commodities where Indonesia is among the top three highest producers and exporters in the world; GDP per capita has been increasing and is around $3,500n per capita; inflation is low; interest rates are relatively low; the currency has been pretty stable.
“These are the reasons why HSBC feels confident about Indonesia,” he added.
“However, the world is going through unprecedented change and it is becoming uncertain. In the last 20 years, change has been driven by two factors; technology and the way consumers are expressing and choosing their behavior. Technology has overtaken consumer trends, particularly in lifestyle and life expectations.” Indonesia is the fourth most populous country in the world. The worlds’ population is it expecting to go to 9 billion by 2050. Indonesia population will increase to 500 million people.
Indonesia is a country where social media and Internet platform are used extremely widely across the country, Dutta noted. “This is a country of thousands of island and is linking together using digital platforms. Looking at options, there are a lot of opportunities that are relevant to a country like Indonesia.” Indonesia’s young entrepreneurs need to embrace it more. Linking digitally with other sectors such as agriculture is critical. Agricultural innovation through online marketing and application has tremendous potential for this country. Infrastructure is the current government’s most significant growth plan. Indonesia needs to further harness this opportunity and bring the country together through infrastructure, especially in transportation such as airports, seaports, high-speed rail, and toll roads.
Other infrastructure projects such as power plants, public housing, industrial parks will also be crucial in terms of meeting the demands of a large vibrant economy.
“The world is going to change. What does Indonesia want to be in 2045? That is something we want to think of. We want to change situation together,” Dutta said.
HSBC will play a critical role by selling the Indonesia story to its global client base and in the process contribute to building more prosperous and sustainable Indonesia.
CEO of HSBC Indonesia