The 7th Joint European Business Confidence Index (BCI) Release event was held on Friday, 09 August 2019 at The Sultan Hotel & Residences Jakarta. IBAI as the partner for BritCham event’s “Business Confidence Index 2019 Release” sent its two representatives to the event. The event was opened with opening remarks from Corine Tap from EuroCham and Raffaele Quarto from EU Commission. The presentation was presented by Nick Holder from BritCham and the data presented based on The Nielsen Company survey.
The result from the Business Confidence Index 2019 remains relatively stable compared with the result from year 2018 and 2017. For the key business sectors of companies, the highest percentage came from Services (Private) sectors and Infrastructure & Construction, both at 19% and followed by Energy and Natural Resources, Banking, Finance, & Insurance, and Hospitality, Travel, and Tourism sectors. Their perspective towards the business in Indonesia over the next 12 months is remain positive at the percentage of 60% even though this number is declining 2% from last year’s result. The sectors that is quite improved is in Educational (Formal / Informal) sector and there is a less positive outlook for Hospitality / Travel and Food & Beverages sectors compared to last year. Also, the results shown most of the respondents are interested in expanding outside Java at the percentage of 29%.
There are also several factors that are affecting the business in Indonesia. Some of them are regulations and the investment climate. For this, the respondents gave a very positive outlook improvement on the political environment and there is a positive trend on regulatory and legal environment. However, there is a rising concern about protectionism, where the government is still trying to protect domestic business and restrict the international trade. There is also a survey result shows that companies still remain undecided regarding any major investment in Indonesia for the next 2 years. Fortunately, the government did a great action toward this and the result is shown in the data where the government does do consultation with the business, coordinating with other ministries, and pro with business decision. One of the speakers from KADIN, Ms. Shinta Kamdani as the Vice Chair from KADIN confirmed that the government has do the consultation to them.
In this current condition where the Business Confidence Index 2019 gives a positive outlook and still remains stable compared to the last 2 year’s result with an increasing concern about the protectionism as one of the challenges, the most appropriate steps must be taken are strengthen the government relation by conducting a forum and having dialogues with them about the policy and regulation, business access, and of course about the implementation on the field to boost the business in Indonesia.
Please access this link to download the presentation materials: https://www.ibai.or.id/publication.html