In line with the recent trend toward nationalism and protectionism, the Indonesian government issued new regulations for franchises in 2012. Like other efforts to defend the country’s economic interests, it is fairly balanced and pragmatic. The policy works to encourage more local participation and limit dominance by any single foreign country or...
Strong growth in Indonesia’s new vehicle sales in recent years has generated sustained growth in the motor segment. “Car sales have been increasing and in turn motor vehicle insurance has been growing rapidly,” Christian Wanandi, the president director of Jakarta-based general insurance company Asuransi Wahana Tata, told OBG. Yet motor’s share of...
The economy is surging ahead, and as it expands authorities are seeking to make the transition from low-cost production and supplying raw materials to more advanced nations to a high-value-added manufacturing industry. It will not be easy, for as wages rise and investments are made, some companies, or entire industries, will be left behind. National...
Modern retail seems to be an obvious development in Indonesia with the quick proliferation of minimarkets, convenience stores and hypermarkets. The country is crowded, so it makes sense to have numerous small, highly efficient shops nearby so driving is not necessary. It has a large, relatively poor population, so big, efficient retailers providing...
Until recently, Indonesia had been content to give both international and local mining outfits a wide latitude in terms of how to most effectively profit from the extraction of lucrative mineral deposits, as the state took a share via various taxes, licences, royalties and other agreements. This well-established and stable regime was shaken up in...
With limited local underwriting capacity, larger risks have traditionally been ceded offshore. The limited capacity of the four local reinsurers has stunted efforts to domesticate more risk, leading to volatile rates. Consolidating and developing reinsurance capacity will thus be crucial to future efforts to develop the industry, while higher...
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