Indonesia’s Property Sector is Safe Say Savills

Indonesia's Property Sector is Safe Say Savills
Coronavirus impact on Indonesia
Photo by Ani Kolleshi on Unsplash.

The world, it seems, is on high alert again. This time it’s because of the Coronavirus, now called COVID-19. Some countries and cities are on lock down, travel bans are in place and the threat of a global pandemic seems frighteningly real.

Indonesia however, has yet to officially a report a case of the disease, even though there have been incidents of travelers testing positive when arriving back home after visiting Indonesia.

Bali’s tourism industry

The worldwide reaction to COVID-19 is sure to impact global economies. A recent article in the Straits Times claims, “analysts are looking at possible economic losses equal to nearly 5-percent of the global GDP. We are talking about a staggering USD 4.17 trillion.”

Although there are no reported cases in Indonesia, Bali’s tourism industry is feeling the effects. This is understandable. According to the New Straits Times, “the Indonesian Hotel and Restaurant Association recorded at least 20,000 cancellations for Bali since the rise of the new Coronavirus in early January.”

Fake news!

However, the situation is not as bad as some media outlets have been reporting.

Bali is not a ghost town. The streets are not barren. The local economy will not collapse. And there isn’t panic with crowds of people rushing out to buy hand sanitizers. Good grief!

This kind of scaremongering might sell newspapers, but it should not be taken seriously. It’s fake news people!

Indonesia’s property sector

According to Savills Indonesia, the COVID-19 threat hasn’t had much of an impact on Indonesia’s property sector.

Kontan are reporting Head of Research and Consultancy, Anton Sitorus as suggesting this is because Indonesia’s regulations on foreign land and property ownership have reduced the influence foreigners have on market trends. Basically this means the majority of property transactions are between Indonesians and domestic players dominate the country’s property market.

You might want to check out what Nino Saununu SH says about foreigner property ownership by following this link …

On the other hand, Sitorus explained that neighbouring Thailand and Australia are being negatively affected because they have both been popular destinations for Chinese property buyers, suggesting at least USD 2.3 billion was invested in Thailand by Chinese investors and USD 17.4 billion in Australia in 2018.

Initiatives to boost the local economy

Indonesia’s reaction to what is certainly a significant global problem is however, most encouraging. And in many senses a very good sign of how serious the government is when it comes to encouraging investment.

The Straits Times are reporting Finance Minister Sri Mulyani announcing “a raft of measures, including the disbursement of IDR 10.3 trillion to help domestic businesses and consumers counter the economic impact of the coronavirus.”

More than IDR 4.5 trillion will be allocated for the country’s poorest. The intention is to “boost consumer spending and create multiplier effects on the economy,” Mulyani told reporters.

Encouraging domestic tourism

At the same time, the government will spend another IDR 298.5 billion “on joint promotions with airlines and travel agents to attract foreign tourists to the archipelago,” say the Straits Times and provide IDR 443.9 billion to encourage domestic tourism. One initiative is offer a 30% discount on plane tickets to local travellers going to the “10 New Balis.”

Stimulating the housing sector

The government also plans to “funnel about IDR 1.5 trillion rupiah to stimulate the housing sector … IDR 800 billion to reduce mortgage installments and IDR 700 billion to subsidize down payments,” claim the Straits Times, who go on to say Mulyani “underlined the significant multiplier effect of this aid to the property sector, citing 170-supporting industrial sectors.”

Skills training

In addition, Airlangga Hartarto, Chief Coordinating Economic Minister, is aiming to help the unemployed by expediting “the launch of the pre-employment card programme, with Bali, North Sulawesi and Riau Islands,” which will accelerate skills training programmes say the Straits Times.

Sources: Kontan, Savills, New Straits Times, Straits Times, The Daily Mail

#coronavirus #COVID-19 #indonesia #indonesiaproperty #indonesiainvestment #foreigninvestment #balitourism #fakenews #domestictourism #economy

Latest Article
Recruiting Foreign Doctors Will Improve Health Services
Emanuel Melkiades Laka Lena, a member of Indonesia’s House of Representatives (DPR), has said that the...
Indonesia Proposes Visa-Free Entry for 20 Countries to Boost Tourism and Economy
In December 2023, Indonesia’s Ministry of Tourism and Creative Economy  proposed visa-free access...
Top 5 Most Visited Provinces by Foreign Tourists in Sumatra
  Bali, Lombok, and Raja Ampat certainly capture the tourism spotlight. However, Indonesia boasts...
Ministry: Immigration Services Restored
Indonesia’s Law and Human Rights Ministry’s Director General of Immigration, Silmy Karim, has announced...
More Than 1 Million Tourist Visits in April
According to reporting from Antara News, Indonesia’s Ministry of Tourism and Creative Economy announced...

Andrzej Barski

Director of Seven Stones Indonesia

Andrzej is Co-owner/ Founder and Director of Seven Stones Indonesia. He was born in the UK to Polish parents and has been living in Indonesia for more than 33-years. He is a skilled writer, trainer and marketer with a deep understanding of Indonesia and its many cultures after spending many years travelling across the archipelago from North Sumatra to Irian Jaya.

His experience covers Marketing, Branding, Advertising, Publishing, Real Estate and Training for 5-Star Hotels and Resorts in Bali and Jakarta, which has given him a passion for the customer experience. He’s a published author and a regular contributor to local and regional publications. His interests include conservation, eco-conscious initiatives, spirituality and motorcycles. Andrzej speaks English and Indonesian.

Terje H. Nilsen

Director of Seven Stones Indonesia

Terje is from Norway and has been living in Indonesia for over 20-years. He first came to Indonesia as a child and after earning his degree in Business Administration from the University of Agder in Norway, he moved to Indonesia in 1993, where he has worked in leading positions in education and the fitness/ wellness industries all over Indonesia including Jakarta, Banjarmasin, Medan and Bali.

He was Co-owner and CEO of the Paradise Property Group for 10-years and led the company to great success. He is now Co-owner/ Founder and Director of Seven Stones Indonesia offering market entry services for foreign investors, legal advice, sourcing of investments and in particular real estate investments. He has a soft spot for eco-friendly and socially sustainable projects and investments, while his personal business strengths are in property law, tourism trends, macroeconomics, Indonesian government and regulations. His personal interests are in sport, adventure, history and spiritual experiences.

Terje’s leadership, drive and knowledge are recognised across many industries and his unrivalled network of high level contacts in government and business spans the globe. He believes you do good and do well but always in that order. Terje speaks English, Indonesian and Norwegian.

Contact Our Consultants

[wpforms id=”43785″]

Ridwan Jasin Zachrie

CFO of Seven Stones Indonesia, Jakarta

Ridwan is one of Indonesia’s top executives with a long and illustrious career in the financial world. He holds several professional certifications including being a Certified Business Valuer (CBV) issued by the Australian Academy of Finance and Management; Broker-Dealer Representative (WPPE); and The Directorship Certification for Directors and Commissioners, issued by the Indonesian Institute of Commissioners and Directors.

His experience includes being the Managing Director at one of the top investment banking groups in the region, the Recapital Group, the CFO at State-owned enterprises in fishery industry and the CEO at Tanri Abeng & Son Holding. He’s also been an Independent Commissioner in several Financial Service companies and on the Audit and Risk Committee at Bank BTPN Tbk, Berau Coal Energy Tbk, Aetra Air Jakarta as well as working for Citibank, Bank Mandiri and HSBC. His last position was as CFO at PT Citra Putra Mandiri – OSO Group.

Ridwan has won a number of prestigious awards including the Best CFO Awards 2019 (Institute of Certified Management Accountant Australia-Indonesia); Asia Pacific Young Business Leader awarded by Asia 21 Network New York USA (Tokyo 2008); UK Alumni Business Awards 2008 awarded by the British Council; and The Most Inspiring Human Resources Practitioners’ version of Human Capital Magazine 2010.

He’s a member of the Board of Trustees of the Alumni Association of the Faculty of Law, Trisakti University, Co-Founder of the Paramadina Public Policy Institute and actively writes books, publications and articles in the mass media. He co-authored “Korupsi Mengorupsi Indonesia” in 2009, which helps those with an interest in understanding governance in Indonesia and the critical issue of corruption. Ridwan speaks Indonesian and English.

Per Fredrik Ecker

Managing Director of Seven Stones Indonesia, Jakarta

Per is the Managing Director of the Seven Stones Indonesia (SSI) Jakarta office and has more than 25-years’ experience in Indonesia, China, and Western Europe. He previously worked in senior management positions with Q-Free ASA, Siemens AG, and other companies in the telecom sector. Over the last six years, he has been the Chairman of the Indonesia-Norway Business Council (INBC) and recently become elected to be on the board of EuroCham Indonesia.

His most recent experience is within Intelligent Transport Solutions (ITS), Telecom, and other sectors within the Indonesian market. He is today through his position in SSI and by representing Norway Connect, promoting Nordic and European companies that would like to explore business opportunities in the Indonesian market. He’s also playing an active role to help create the Nordic House concept in Jakarta that will provide an excellent platform for Nordic companies entering Indonesia, where they’ll find a community that can offer support with trusted information and affordable services to enter this market.