general overview of doing business in indonesia
TRANSCRIPT
Doing Business in Indonesia
Vitafoods Asia
2Cekindo Bisnis Grup ©2015
Content
1 Market Overview and Facts
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3
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Doing Business in Indonesia
Company Profile
Market Trends and Investments
05/03/2023
Company Profile
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Essentials in Figures
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• Geography: More than 17,508 islands. The largest islands Sumatra, Java, Kalimantan, Sulawesi and Papua take over 90% of total land area.
• Capital city: Jakarta, which is the business and governmental center• People: 252 million, >51% under age of 29• Currency: Indonesian Rupiah (IDR)• Religions: Islam 89%, Protestant 7%, Catholic 3%, Hindu 2%, Others 1%.• Language: Bahasa Indonesia which is similar to Malay.
Market Overview
Total Area Land Area Sea Area Population
1,919,440 km 1,826,440 km 93,000 km 253,609,643
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• Investment Rating (2015): Standard & Poor’s:bb+ positive, Fitch: BBB-, stable, Moody’s: Baa3, stable.
Macroeconomic FactsIndicates 2010 2013 2018 E
Population (mn) 243 251 263
GDP (Nominal, USD bn) 709 868 1657
GDP per head (USD) 2,919 3,460 6,300
Inflation 5.1% 8.33% 6.38%
Export of goods & services (USD bn) 175 206 371
Imports of goods & service (USD bn) 154 212 345
Private consumption (USD bn) 401 485 964
Private consumption per head (USD) 1,650 1,930 3,660
Source: The Economist Intelligence Unit
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Content
Market Overview and Facts
3
4
Doing Business in Indonesia
Company Profile
Market Trends and
Investments
05/03/2023
Company Profile
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1
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The highest Investments Realizations
DDI (Investment Realization 2015) FDI (Investment Realization 2015)
No. Sector Investment (USD million)
Project No. Sector Investment (USD million)
Project
1 Food Industry 1,857 879 1 Mining 4,017 1066
2 Electricity, Gas, and Water Supply
1,661 247 2 Transportation, Warehouse and Telecommunication
3,290 493
3 Transportation, Warehouse and Telecommunication
1,615 213 3 Metal, Machinery and Electric 3,092 1781
4 Chemical and Pharmaceutical
1,568 320 4 Electricity, Gas, and Water Supply 3,029 350
5 Construction 1,299 178 5 Real Estates, Industrial and office building
2,434 858
6 Food Crops and Plantation
911 372 6 Food Crops and Plantation 2,072 606
• 17,238 permits processed, with total investment commitment of USD 140 billion.• 2016 target FDI of USD 28 billion, DDI of USD 20 billion of realized investment.
Source: The Investment Coordinating Board of the Republic of Indonesia (BKPM)
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Investments
Source: The Investment Coordinating Board of the Republic of Indonesia (BKPM)
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• Aggressive marketing from leading manufacturers.• Pharmacies as the larges distributor channel for consumer health
products in 2015.• Middle-class consumers are better informed about diseases from the
unhealthy lifestyles, such as diabetes, high cholesterol and high blood pressure.
• Increasing health awareness, Indonesians start to prefer consume food and drink that contains the vitamins/nutrients to boost immunity.
• Middle and upper class consumers start to purchase vitamins and dietary supplements products/pills, tablets or drinks to maintain their health and do exercising.
• Higher demand for baby nutrition and herbal/traditional products itself from natural materials
What support double digit growth of Consumer Health products in 2015?
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Content
Market Overview and Facts
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Doing Business in Indonesia
Company Profile
Market Trends and
Investments
05/03/2023
Company Profile
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1
3
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Doing Business in Indonesia
The decision to enter new market is critical, particularly in Asia. Indonesia market is one of potentials market to be entered in Asia. As a consulting firm, we have wide experience in assisting our clients from various industries to enter Indonesian market.
As we understand the local market specifics and take advantage of our wide network, we aim to provide an update information to foreign entities and entrepreneurs to support their business in Indonesia.
There are two options which can be chosen prior to enter Indonesian market.
1.Cooperate with local partner/distributor
2.Company Incorporation
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Cooperation with Local Partner
Search and Shortlisting the potential distributors based on the requirements
Conduct and arrange initial meetings with potential distributors
Company review to clarify the background of the distributors
Negotiations and Close cooperation
Product Registration
Several steps to encourage the potential distributors
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Company Incorporation
1. PT. PMA require minimum 2 shareholders, 1 director and 1 commissioner2. Planned business activities determine percentage allowed for foreign in Indonesia3. The minimum investment of PT. PMA is USD 1.000.000 and minimum 25% of total investment is paid-in-capital4. IUT (Permanent Business License) can be obtained after realization of investment by LKPM report
Foreign Owned Company (PT. PMA)
1. Local PT require minimum 2 local shareholders, 1 local director and 1 local commissioner 2. There are 3 sizes of local PT based on the amount of paid in capital : - small - medium - large 3. If company plans to hire foreign, medium size with capital IDR 1.000.000.000 is required
Local Company (PT)
1. Representative office is limited only for market studies, marketing, promotion and not allowed to generate any revenue in Indonesia2. No shareholder requirement3. No director and commissoner requirement4. No capital requirement5. Representative office require minimum 1 Chief of Representative Office
Representative Office
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Registration with Ministry of Trade to obtain company registration certificate
Open bank account and pay capital
Tax number and VAT registration
Obtain government letter office domicile
Execution of the documents by shareholders and notarization by a public notary
Preparation of company’s incorporation documents
Obtaining Investment approval from BKPM
Summary of company registration procedures
• The time frame for PMA company Incorporation is around 2-3 months.• Companies are required to keep accounting records and prepare annual financial reports.• Local nominee is not supported by Indonesian Law.• Principal license and then a Permanent Business license allowed to apply for import license, work Permits.• The Indonesian authorities recognize virtual office.
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• Foreign Investors must apply for approval from BKPM.• Indonesia prohibits foreign currencies for domestic transactions.• All legal documents to be translated in Bahasa Indonesia.• Corporate Tax 25% and VAT 10%.• Import duty payable 0% - 150% on customs value of imported goods.• On luxury goods both manufactured in and imported into Indonesia are
the rates range from 10-50%. • Bank Indonesia regulated dollar purchases above USD 25,000 with
requirement to show underlying transaction documents.
Legal & Tax Considerations
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• Bureaucracy is slowly reducing.• Rules are often unclear and can change quickly.• Challenging labour situation with rising minimum wage.• Choosing the right partner as one of the important key.• Use of Bahasa Indonesia and English for business.• Respectful and indirect communication style in business.• Informal get-to-know-you initial business meetings.
Local Flavors
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Content
Market Overview and Facts
Doing Business in Indonesia
Company Profile
Market Trends and
Investments
05/03/2023
Company Profile
2
1
3
4
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Company Profile
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PT. Cekindo Bisnis Grup is a leading consulting firm of business services to clients expanding and operating in Indonesia and further to Southeast Asia.
Cekindo provides full-range of market-entry and corporate secretarial services to enable our clients to focus on their core business and activities in Indonesia.
Our Vision
To be leading consulting firm of business services to clients expanding and operating in Indonesia.
Our Mission
To provide full-range of market-entry and corporate services to enable our clients to focus on their core business and activities in Indonesia and beyond.
Our Values
Client-focused
Excellence performance
Knowledgable locally
Integrity moral
Normative operations standards
Delivered on-time
One stop services provider
Our main services include :
Business Set Up
- Company Registration- License & Product Registration- Market Research & Analysis- Local Partner Selection- Trade Mission- Land & Property Ownership
Business Process Outsourcing
- Recruitment & HR Establishment- Payroll Management- Accounting & Tax Reporting- Visa & Work Permit- Mystery Shopping
Local Representation
- Local Distributor & Partner- Buying Agent- Office Space
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Profile Overview Relevant Experience:
Mr. Ramelan is currently Senior Advisor at PT Cekindo Bisnis Grup.
Hi is a Research Professor at the Agency for the Assessment and Application of Technology.
The honorary degree of Doctor Honoris Causa from Monash University, Australia and Northeastern University Boston.
Senior Advisor– Prof. Dr. Rahardi Ramelan
• Minister of State for Research and Technology of the Republic of Indonesia and Chairman of the Agency for Assessment and Application of Technology (BPPT) in the Seventh Development Cabinet of the Republic of Indonesia.
• Minister of Industry and Trade in the Development Reforms Cabinet of the Republic of Indonesia and Chairman of National Logistic Agency.
• Deputy Chairman for Industrial Analysis and Vice Chairman of the National Development Planning Agency of the Republic of Indonesia
• Several management positions and responsibilities related to Indonesian Aviation industry, the Weapon industry.
Prof. Dr. Rahardi Ramelan
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Profile Overview Relevant Experience:
Michal is currently Principal Consultant at PT Cekindo Bisnis Grup.
He has more than 5 year‘s experience in the Corporate Market research, Strategy and Evaluation Expansions, Business Consultancy, and Preparation of Business Feasibility Studies.
He has worked for various industries, namely Grocery and Marchandise Retail, Energy, Medical Device, Heavy and Automation Industries.
+6281282300584 [email protected]
Principal Consultant– Michal Wasserbauer
Multinational grocery and general merchandise retailer: Capital Investment Appraisals• Performed a position of Senior Capital Investment Specialist for Czech & Slovak with key
responsibilities for Capex, appraisals of new store openings, reconstructions, market opportunities valuation, long-term planning, financial performace strategy and performance evaluation, and financial reporting to Financial Director for Czech Republic & Slovak Republic.
World‘s largest student and recent graduates-run organisation: Financial Controller• As Vice President for Finance and member of Executive Board, responsible for managing the
financial team. Ensuring financial stability and financial legality of all local entities in the Czech Republic, includes budgeting, controlling, financial education, coaching and mentoring. Implementing measurable performance indicators such as competencies and KPIs.
International consultation company: Market Expansion Consultant• Provided marketing consultancy and advisory for foreign companies with goal to expand to
Indonesia. Delivered feasibility studies for energy, medical device, retail, heavy and automation industries. Assisted in establishment of the local and international company related to legal and bureaucracy requirements as well as outsourcing of supporting processes for foreign companies.
Michal Wasserbauer
Relevant Skills:• Market opportunities valuation• Investment analysis• Performance management • Feasibility studies• Strategy planning
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• Stakeholder management• Marketing consultancy
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Profile Overview Relevant Experience:
Nurmia is currently Principal Consultant at PT Cekindo Bisnis Grup.
She has wide experience in the areas of Business Development, Legal Corporate Restrictions, Business Consulting, Project Management, Market Development & Entry Strategy, Sales & Distribution, Management Strategy, Recruitment, Visa & Work Permit, and Change Management.
She has worked for various industries, namely Energy & Resources, Telecommunication, Retail, Pharmaceutical & Medical, Financing, Non-Profit, IT and Heavy Industries.
+628119691987 [email protected]
Principal Consultant– Nurmia Dwi Agustina
International Management company: Management & Legal consultant • Responsible in designing, developing, and implementing of strategies for market expansions,
Project management, Develop communication and legal plan and program, support the organization alignment from current to new leagl and business process, conduct value chain mapping of prioritized businesses and alalyze.
Chamber of Commercial: Head of Business Processing Section • Responsible for business processing section, assisting European companies in their expansion
legal process in Indonesia, holds position of the honorary Vice-President for the Asian market in the Portuguese Association Expandia.
She has worked for various industries, namely Energy & Resources, Telecommunication, Retail, Pharmaceutical & Medical, Financial Services, Non-Profit, IT and Heavy Industries.
Nurmia Dwi Agustina
Relevant Skills:• Corporate law• Outsourcing processes• Company formation• Acquisitions• Project Management• Competitive Analysis
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• Business Planning• Risk Management• Talent Management Strategy• Recruitment• Visa & Work Permit• Change Management
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Selected Clients…
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PT. Cekindo Bisnis Grup
Menara BCA Grand Indonesia 50th flJl. MH. Thamrin No. 1Jakarta Pusat 10310
Indonesia
[email protected]+6221 580 6889
http://www.cekindo.com