External Trade Briefs
Indonesia booked trade surplus of US$85.1 million in August 2019 against deficit of US$64.3 million in the previous month. This was attributable to 7.6% decline in export revenues to US$14.28 billion, while impor fell 8.3% to US$14.2 billion. In general, Indonesia’s export declined 8.28% year-on-year to US$110.07 billion in the first eight months of 2019, dragged down by falling average price of key commodities.
Travel Note: Labuan Bajo
I recently travelled to Manggarai, Flores Island to pay homage to my uncle. One thing, due to its growing popularity, it is difficult to get airline ticket on short notice. All three direct flights from Jakarta (Garuda Indonesia, Citilink, and Batik Air) were fully booked. I had no choice than to travel via Denpasar, Bali Island. I took Wings Air (ATR aircraft) with about one hour flight to Komodo airport in Labuan Bajo, Manggarai Barat regency, Flores Island.
Improved infrastructure
Landed at New Yogyakarta International Airport in Kulonprogo, Yogyakarta on Thursday (Aug 29), President Joko ‘Jokowi’ Widodo was informed by port operator PT Angkasa Pura I that the airport will be fully operational early next year. The airport is crucial to revitalize tourism industry in Yogyakarta and development of emerging destination Borobudur Temple in Central Java province.
Towards Steel Surplus?
If we can trust in data provided by the Central Bureau of Statistics (BPS), Indonesia’s steel deficit had dropped significantly from US$8.9 billion in 2013 to US$4.65 billion in 2017. And if we can trust data provided by Indonesia Morowali Industrial Park (IMIP), Indonesia might soon entering a steel surplus.
Healthier Outlook for Pharmaceuticals
The government’s proposals to strengthen financials and operations of the universal healthcare program BPJS Kesehatan could boost valuation of companies in the healthcare industry, especially hospitals and pharmaceutical players. We might see more investments from private equity firms in the sector.
Moving to East Kalimantan (2)
Less than 24 hours after President Joko Widodo announcing an area in Penajam Paser Utara and Kutai Kartanegara will become the new capital city, property developer PT Agung Podomoro Land (APLN) Tbk published one full page advertisement at Kompas, the largest newspaper in the country, about its Borneo Bay City project in Balikpapan, the biggest city in East Kalimantan province.
Update on Industries
National cement consumption declined by 1.6% to 6.4 million tons in July. It declined 2% year on year (y/y) to 35.7 million tons for Jan-Jul 2019 period. Cement consumption in Java and Sumatera declined in July. DKI Jakarta posted a 30% fall in cement consumption, and Central Java’s cement consumption fell 23%.
Salim (indirectly) expands water business
PT PP Infrastructure, subsidiary of state-owned EPC firm PT Pembangunan Perumahan Tbk (PTPP), has signed a partnership with Maynilad Water Services Inc, indirectly owned by Salim Group, for the development of water infrastructure system in West Java province.
Improved Infrastructure Outlook (3)
Soekarno-Hatta international airport, one of the busiest airports in the world, finally has a new runway, the third. NAM Air flight from Pontianak (West Kalimantan) became the first commercial flight to land at the new runway last Thursday (Aug 15). The third runway lifts the airport’s handling capacity to 114 flights per hour, reducing the waiting time significantly.
Improved Infrastructure Outlook (2)
Hutama Karya has completed construction of Terbanggi Besar-Kayu Agung (189 KM) toll road in South Sumatra. Depending on results of trial run, commercial operation might soon be inaugurated, lifting further infrastructure profile of Sumatra Island, the second most populous island in the country.