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The number of listed companies on the Indonesian Stock Exchange (IDX) increased by 50% in the decade to 2014, and market capitalisation was up five-fold in that period. In terms of the exchange’s performance, the index has risen far more than those of its regional peers and international benchmarks. Still, the capital markets are in need further development. For the nation to grow as it hopes and plans, the IMF and others have said that it must endeavour to create markets that are larger and more sophisticated. If the capital markets continue to improve and evolve, and if the authorities are able to get more firms listed and increase the number of shareholders, volatility and risk can be greatly reduced and the markets can play a more significant role in the transformation of the economy. This chapter contains interviews with Muliaman D Hadad, Chairman, Financial Services Authority; and Michael Steven, President-Director, Kresna Securities.

The Indonesian banking sector continues to strengthen after a lengthy period of expansion. Business remains sound with sufficient capital to support credit growth, and the regulatory environment setting up the industry for further expansion. Questions about consolidation and foreign participation remain, and the structure of the sector going forward is a matter of debate. Economic concerns also hang over the banks, but participants are confident the institutions themselves are sound. As long as Indonesia continues to refine its laws to encourage competition, the sector should remain on the course it has charted for a decade and become more inclusive. This chapter contains interviews with Sumit Dutta, CEO, HSBC Indonesia; Jahja Setiaatmadja, CEO, Bank BCA; and Budi G Sadikin, President-Director, Bank Mandiri.

Early moves made by the government of the new president, Joko Widodo, appear to be helping the economy considerably, especially on the FDI side. With the application of the right policies, the country could return to growth above 6%, and perhaps eventually reach the 7% target set by the new president. Indonesia is working off a sound economic base. The decline in GDP growth has been stopped, and the country is starting to make the transition from a consumption- and export-dependent economy to one that is more driven by investment, manufacturing and perhaps even the export of finished products. Risks remain, particularly in terms of overly aggressive policies on the one hand and implementation issues and protectionism on the other. If the right balance can be struck and the government’s plans can be translated into tangible projects, many see the possibility for growth to return to levels that are higher than regional and global averages. This chapter contains interviews with Bambang Brodjonegoro, Minister of Finance; and Basuki “Ahok” Purnama, Governor of Jakarta.

With full-year realised foreign direct investment (FDI) hitting a new record in 2014, Indonesia’s trade and investment flows have improved considerably over the last 10 years. The capital account deficit was brought back under 3% that year, and at the end of 2014 and in early 2015 the country reported a trade surplus after years in the red. Due to stronger economic growth and new policy initiatives, the uptick could become a sustained trend. However, risks remain. The government and monetary authorities need to keep a grip on policy, making sure they maintain discipline without being too strict. Early indications are that the new administration and the monetary authorities will work effectively towards achieving the right balance through consistent, steady improvements. This chapter contains interviews with Franky Sibarani, Chairman, Indonesia Investment Coordinating Board; Ngalim Sawega, Chairman and Executive Director, Indonesia Eximbank; and SD Darmono, President Director, Jababeka.

This chapter examines the legal environment in Turkey, focusing on how changes in regulations are enabling investment across the country’s many business sectors. It also contains a viewpoint from Harun Kılıç, Partner at Kılıç and Partners.