Indonesia’s Growth- Sky is the limit?

27 Nov, 2008, Indonesia

At a time when other regions are struggling, Indonesia is enjoying an unexpected boost in economic activity, according to a report released by Cushman & Wakefield, the world’s largest privately held real estate consulting firm.

Indonesia- At the Crossroads, another in the firm’s Asia Report series, delves into the reasons behind Indonesia’s relatively insulated current growth despite the ravelling of a global economic crisis. The report goes on to discuss how Indonesia can sustain this growth into the future.

"Though a bright star in the cluster of Asian economies, Indonesia’s growth could improve dramatically over its current levels if certain institutional reforms are implemented improving the country’s perception in the international investor community”, says Dr. Megan Walters, Chief Economist for Cushman & Wakefield in Asia Pacific, and the author of this report.

A recent study by the Asian Development Bank found that markets in Asia post 1997 crisis are increasingly interdependent in equity markets and intra-regional trade. Dr. Walters foresees this to be the key to the island nation’s sustained growth.

“Indonesia, embattled with issues like bureaucracy, low investor confidence, archaic labour and land laws, would benefit greatly if it aligns itself with future pan Asian regulatory bodies modelled on the European Union. It will not only help alleviate issues that are holding back Indonesia’s growth, but will also enable far flung regions of Indonesia to trade with nearby countries as part of broader trade agreements and macroeconomic policies,” commented Dr. Walters.

Indonesian real estate remains relatively inexpensive. The new investment law which enshrined the right for all investors – both foreign and local to be treated the same, could further stimulate investment activity in the property sector.

Dr. Walters concludes, “For investors who are prepared to take a long term view, Indonesia has a great deal to offer. It is a low cost base from which to operate, and is expected to continue to be cheaper than neighbouring countries. Clearly it’s a risk - return equation, but the point is that there is about to be a shift in global balance, and Asia is about to benefit. At the heart of South-East Asia, Indonesia could and should be one of the winners.”

For further information, please contact:

The Press Office

Cushman & Wakefield

Tel: + 65 6232 3232

Visit Cushman & Wakefield’s Knowledge Centre at www.cushmanwakefield.com to access this and other reports on leading real estate issues, trends and market statistics from around the world.

Note to Editors:

1. Cushman & Wakefield is one of the world’s largest commercial real estate services firms. Founded in 1917, the firm has 227 offices in 59 countries, and 15,000 talented professionals. Cushman & Wakefield delivers integrated solutions by actively advising, implementing and managing on behalf of landlords, tenants, lenders and investors through every stage of the real estate process. These solutions include representing clients in the buying, selling, financing, leasing and managing of assets. The firm also provides valuation advice, strategic planning and research, portfolio analysis, and site selection and space location assistance, among many other advisory services. To find out more about Cushman & Wakefield, visit www.cushmanwakefield.com

2. In Asia Pacific, C&W’s Research and Business Analytics Group is lead by Dr Megan Walters. Dr Walters is a Chartered Surveyor with 20 years experience in real estate and holds an MSc from the University of Reading and a PhD from the University of Hong Kong.

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