INDONESIA & ELECTRONICS MARKET
- Indonesian consumers keenly spend their rising personal earnings on electronics and home appliances, striving for the personal comfort and entertainment that characterize a middle-class lifestyle in many parts of the world. The driving force behind this consumer trend, aside from the general increase in living standards, is urbanisation and the booming residential property market in Indonesia’s emerging economy. Indonesia has a window of opportunity to establish itself as the regional production hub for the manufacture of electronics and home appliances – for both domestic and global brands.
- According to the Indonesian Electronics Producers Association (Gabel), domestic sales rose by around 11% to 38.5 trillion RP in 2013. While this marks a significant slowdown on the preceding two years, it nevertheless far exceeds that year’s GDP growth of 5.8%. Gabel predicted a further 10% increase for 2014.
- According to the Ministry of Trade, Indonesia is home to 235 companies in the electronics and home appliance manufacturing business (including component makers) as of 2014.
- The Indonesian consumer electronics has the potential to be a medium-term outperformer due to broad based economic growth, low device penetration rates and vendor investment in local presence over recent years. We have a bullish outlook for consumer electronics spending growth in Indonesia over the medium term to 2019. There is however potential downside from disruption as a result of mooted smartphone import taxes and other import restrictions – but the medium-term outlook remains positive. Overall market growth will see the market reach USD20.3bn in 2019, equal to a compound annual growthrate of 5.0% in US dollar terms 2015-2019. Computer Hardware Sales: USD6.8bn in 2015 to USD9.4bn in 2019, compound annual growth rate(CAGR) of 6.8% 2015-2019