The Asia-Pacific conference of German business will be held this year in Jakarta. In the run-up to the DW spoke to Jan Rönnfeld of the chamber of Commerce in Indonesia about the Situation there.
The largest networking conference in the Asia-Pacific Region will take place from 1. to 3. November in the Indonesian capital, Jakarta, instead. 16. Asia-Pacific conference (APK) of German business to be expected to host over 900 guests, including Federal Minister for economic Affairs, Peter Altmaier, and top managers of large companies such as Siemens, Bosch and Daimler. But also many medium-sized companies and around half of the participants coming from the Region.
Indonesia is one of the 20 largest economies in the world. With 260 million inhabitants it is the largest country with a majority Muslim population. In the run-up to the conference, DW spoke to Jan Rönnfeld, has co-organized as a managing Director of the German-Indonesian chamber of Commerce abroad (AHK) in the conference.
Deutsche Welle: How do you estimate the economic Situation in Indonesia at the moment?
Jan Rönnfeld: Relatively positive, the country is very stable. Among the G20 countries, it is one of the countries with the most stable growth in the five to six percent. The driving force, especially the growing middle class. Approximately 60 percent of the growth will be generated by local consumption, which contributes to the stability.
But Indonesia is affected, like other emerging countries, of a flight of capital. Investors are currently oriented more away from the threshold countries. What are the implications?
The first impact is of course the Currency depreciation, Indonesia is affected. In addition to India, it is the most affected Asian state. The second effect relates to the imports, because Indonesia has to import most of its Oil and petroleum products. A poor exchange rate, coupled with high Oil prices, has consequences that can be felt in the government.
But this also means that the population feels it, too?
Yes, of course, about the rising gasoline prices. And there is an inflationary effect that is felt also in the case of other imported goods. Conversely, the increase in the prices of raw materials also has a positive effect, because Indonesia exported also raw materials [including coal and Gas – Anm. d. Red.] and thus deserves more money. In General, the Currency depreciation, however, is the more dominant effect.
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Jakarta – the Hunger between high-rise buildings
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Jakarta – the Hunger between high-rise buildings
There are fears that the Asian crisis of 1997-98 could repeat? At the time, Indonesia’s currency lost 75 percent of their value, many companies went bankrupt.
Many Indonesians who are now in senior positions, have experienced this crisis at the time. Insofar, this is a fear that is in the room. I believe, however, that the Situation today is more stable than in 1998.
Indonesia now has significantly more foreign reserves, between 115 and 120 billion dollars. If you calculate, how many months a country would be able to Finance its foreign trade, then Indonesia is well above the threshold of three months. Also the foreign debt is limited, and the national debt is only around 30 percent of economic output. Since Indonesia is in a really convenient location.
Despite this stability there is in the markets of certain Irrationalities in relation to the emerging countries. How do you see that?
If you compare Indonesia with his Peer Group – i.e. with countries which have similar development levels – then wouldn’t the surrounding countries, but rather Brazil, South Africa, Turkey or Russia. If you look at what these countries had in recent years for problems, then Indonesia is a relatively relaxed country.
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Indonesia, a country is sinkingWith wet shoes to class
Ankle high the water is to Wade through the students of Pantai Bahagia elementary school. So your school looks now, often, because, on the Indonesian island of Java, the high water is now part of everyday life. The sea level is rising because of climate change, at the same time storms are becoming more violent.
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Indonesia, a country is sinkingLearn in the mud
Earlier the sea kilometers was far away, in the meantime, the tide rises nearly every day in the class room and behind a fine mud in addition to layer of moisture on the ground. Especially the places in the coastal area of Pantai Bahagia are not affected by Jakarta. Climate researchers from Jakarta to fear that the sea level could rise in the coming decades by up to 90 centimeters.
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Indonesia, a country is sinkingWith Tricks by the floods
With the help of a Styrofoam Board the motorcycle of a woman is pulled over the completely flooded road in the fishing port of Jakarta, Muara Baru, – the metropolis of Jakarta is sinking in the floods, and Improvisation is a part of life. Meanwhile, about 40 percent of the city are already below sea level, estimates the environmental protection organization “Wetlands International”.
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Indonesia, a country is sinkingIf the forests lack
A street vendor pushes his Snacks and drinks filled the landing place of Kali Adem port of Jakarta. One reason for the Floods, the gradual Disappearance of the mangrove forests that lined originally, the coasts of Indonesia and the flood in a natural way eindämmten.
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Indonesia, a country is sinkingCelebration evening in the water
A woman in the village of Sriwulan watching TV, while the brown flood flooded your whole house. Electronic devices are placed on concrete blocks, otherwise, life for Many appears to go in a state of emergency.
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Indonesia, a country is sinkingNot a normal Childhood
In the case of their neighbours in the village of Sriwulan the living room, sinking in the waves – which are also the electrical threat is near. The families of the fishermen persevere, often in the hope of better times. For a move the money. Many people are also put up in their home, occupying it for generations.
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Indonesia, a country is sinkingArrange in the Inevitable
Younger residents often: in an Aquarium-Like student Sriwarsih sits in her house in the village of Bedono. Thanks to the plastic construction of at least some pieces of clothing may be the constant moisture poorly protected.
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Indonesia, a country is sinkingHope is not enough
A man prays on the water-bathed grave of his brother in the port city of Semarang. The government is trying to flood not only there to overcome: Together with environmental organisations to plant on the coastal strip of mangrove trees, build dikes and try to resettle the people. But this is often not easy.
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Indonesia, a country is sinkingWhy a Wall is not enough
In order to protect the coast, were built in the district of Jakarta concrete walls. Hydrologists do not fear, however, that the insulation alone is not sufficient. Because of the soil decreases, illegal Wells excavations in Jakarta to dry and hollow out the ground. That the tomb stop, seems unlikely, because not even the half of the city is supplied by public water lines.
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Indonesia, a country is sinkingChildren can have fun in the danger zone
Flip-flops and into the water: These guys are splashing during the high tide at the port of Kali Adem in Jakarta. Experts suggest that Indonesia still has about a decade of time, in order to prevent a further decline in the coastal region. After that, will worsen the lives of millions of people.
What are you hoping for from the Asia-Pacific conference in Jakarta?
Indonesia was selected to draw attention to this country. On the priority scale of the German companies, the country is not yet where it does because of its capabilities and size. Therefore, the decision was made for Jakarta.
Generally speaking, the conference is not a bilateral, but an Asian conference, and it is also global topics will be discussed. We expect this to have an exchange with the fast-growing Region Asia – to see which countries are still focused on free and rule-based trade, and not so strong protectionist tendencies.
Jan Rönnfeld for nearly 14 years, managing Director of the chamber of Commerce abroad (AHK) in Indonesia. Previously, the studied economist, has an MBA and a Bachelor’s degree in cultural Sciences was, for the German chamber of Commerce in New York. His main subjects are Marketing, strategic planning, and project management.
The Interview was conducted by Manuela Kasper-Claridge.