Indonesia’s construction market is one of the biggest in Asia. According to AECOM, in the medium term (up to 2020) Indonesia is expected to see the fastest construction market growth of any Asian country.
The government has invested to boost the country’s infrastructure in order to provide a better environment for business and economic benefits to its people. 30 infrastructure projects worth some RP 851 trillion have been set as priority and are to be developed until 2019. Indonesia’s road segment is forecasted to grow by an annual average of 12.8% between 2015 and 2024 in nominal terms to become the largest road market by 2024 (Source: BMI Research). These projects create huge opportunities for suppliers of concrete materials, equipment and technology.
A remarkable consequence, the heavy equipment industry has recorded a 30% growth in the construction sector in Indonesia, as opposed to negative rates in all other verticals this industry operates in.
Bank Indonesia’s (BI) series of interest rate cuts – the rate now stands at 6.75% – has furthermore contributed to this growth by making bank financing more affordable. In parallel, companies have been increasingly recurring to bonds as an additional lever to finance expansion (+45% yoy – data from the Financial Services Authority (OJK).
Infrastructure projects will also benefit from the recently approved tax amnesty:
“The most important thing is that the capital inflows can be used to construct our outstanding infrastructure projects,” President Jokowi said, urging authorities to prepare instruments to accommodate the funds.
The latest updates and trends in the construction industry in Indonesia will be shared at Concrete Show South East Asia. Launched in 2013, this pivotal event has established itself as the only dedicated trade show for the concrete industry in the region. The next edition, held during 14-16 September 2016 at JIExpo in Jakarta, will showcase more than 200 companies from 28 countries and will implement a new, state of the art, business matchmaking platform.
Extensive seminars and workshops will be held alongside the exhibition in partnership with the Indonesian Society of Civil and Structural Engineers, Indonesian Association of Precast and Prestressed Companies, Indonesian Association of Precast and Prestressed Engineers and the Ministry of Public Works and Housing Republic of Indonesia.