The Global Outlook 2017

https://www.imf.org/external/pubs/ft/weo/2017/update/01/

The indonesian Outlook 20175

http://www.gbgindonesia.com/en/main/why_indonesia/2016/indonesia_
s_economic_outlook_in_2017_remain_cautiously_optimistic_11694.php

The Global Concern Affecting Economic Growth and Business

Activities
Continuing energy crisis and lacks of provinding adequate
alternate renewable energy resources
inability to secure sustainable productionn and supply foods
Continuing global recession, triggered by weakening (slow
return) of commodity prices
Global political uncertainties Trump effects triggering also
uncertainties in Europe (Brexit, election in Germany, France, and
Netherlands, Russia-Ukraine conflicts and others)
Radicalism spread out domistically anad internationally
Internal conflicts and tension between states
Declining economic power of developed countries that affect
ability to support under-developed countries increasing number
of people under the poverty line
Impact of war against ISIS to US, Europe and the world
Tension between China and Japan, Phillippine, and other
countries on sea territory

Indonesia today
POSSITIVE

Economic growth is a bit better than other countries in the region

and even globally
Pollitical conditions are relatively positive to support economic
growth, with a exception of tension and dynamics related to
Governor Election in Jakarta
No serious regional and social conflicts again except the one in
Jakarta that may change the way leaders see and act on how to
govern Indonesia in the future
The President seems in the surface to get supports from most
political parties and gets also civil society and grass roots
supports
The development of infrastructure as priority moves economy
increases buying power andsupports economy growth
Lifting energy price subsidy gives flexebility to the government in
managing its budget
 mprovement in the prices of commodities helps business in
dealing with their finances and the government in the
improvement of state revenue
Investment rules are relaxed and incentives are provided despite
slow field implementation
New Laws and regulations to ease land acquisition for
infrastructure projects have started to work
Tied money and conservative mobetery politics are apllied quite
strictly
The president shows that he is consistent in implementing his
core policies infrastructure development, relaxing beureucracy,
inviting investment protecting environment and natual resources,
and helping the poor people, education, health, and cash suppot
programs
Indonesia still attracts foreign direct and indirect investments
compares to other parts of region.

NEGATIVE

Pollitical Supports fro political parties seem to be temporary and

may change when their political and business interests ae not
facilitated by the government
Burreucracy reform seem to fail and most of the goverbnent
agencies are not effective not efficient and consume
considerable parts of the state bdget (26%)
Law and law enforcemen agencies reform efforts seem to fail,
KPK and its leaders cold be targeted again if KPK takes a hardline
agaunst politicians in power
Corruption is still high
The pressure from low commodity prices affects the government
budget and forces commodity companies to stop or slowdown
operations and restructure their borrowings; this has been
corrected since the 4th quarter of 2016 but its sustainability is still
in question
Investment facilities are provided to booss investments but field
implementation is slow
Infrastructure projects require enormous amount of funding, and
attracting foreign leaders is difficult during this global economic
condition
State revenue gap was filled by tax amnesty program, however
the tax amensty and 2017 slow economic growth will affect state
revenue from tax 2017
 The tension arising from the regional election, particulary Jakara,
ay change the indonesian future if not corrected in a manner
consistent with indonesian constitusion

Business activities during this weak economic condition

any corporations are forced to restructure its organization and
debt structure this leads to corporate reorganization (merger,
acquisition, consolidation, and debt restructuring)
Bankruptcy is one of tege options if corporations fail to
restructure its debts
Sale of business relocation of business spin off of business are
also result of corporate reorganization
Renegotiation of contracts of many corporations to get more
flexible terms in order t service iys obligations
Labor struke , employment negotitiation, and termination of
employment
Claims die to breach of contracts before courts and arbitrartion
tribunals
Foreign investment althouh it is slow, still attracts bug business
to invest
Infrastructure projects, eEPC contracts, infrastructutre financing
(IPO, Bonds) mau still be growing a bit
oil, as, mining are still continuing at a slow rate despite
uncertainties in the government policies
creative industries may seem be leading but competition is high
and financing is not easy to obtain
Dispute resolutions as result of weak economic condition are
increasing but integrity of the indonesian settlement bidies may
force parties in diespute to prefer foreign arbitration or court
settlement