Asia’s hottest Tiger

Posted on July 15th, 2010 at 5:18 pm by Akhyari


When Indonesia’s export market collapsed in the 1997 Asian financial crisis, the country didn’t look like it would ever get back into the regional manufacturing race.

But,  Indonesia is poised to surpass Vietnam this year as the world’s second largest shoe manufacturer. It’s a sign of the country’s growing attraction as a low-cost hub in Southeast Asia.

Around 300 million pairs of shoes, worth roughly $2bn-$2.5bn, will be produced in Indonesia in 2010,  and takes the $651 billion economy back to the pre-crisis levels.

Indonesia’s economy is growing at 6 per cent, outpacing its regional peers, and weathered the recent global crisis virtually unscathed. Sound fiscal policy and political stability in the emerging democracy of 240m people has prompted a series of ratings upgrades in recent months, and the market is drawing in billions in foreign capital. On Wednesday, the IDX – Jakarta’s main index of stocks – hit a record high at the close.

It is predicted that the nation is on the brink of a true industrial boom.

The commencement of a large scale industrialization over the next five years is now in sight and people are relocating factories from Vietnam, China, to Indonesia.

Indonesia’s Investment Board is touring the globe to build on the momentum, to attract foreign investors, mainly into long-term infrastructure projects for railways, power generation and roads, to bring in major manufacturers, like automakers, and said tax incentives will be offered to the right candidates.

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