Maybank confident on Indonesia outlook

PETALING JAYA: Malayan Banking Bhd (Maybank) remains confident of Indonesia’s long term economic outlook due to its strong fundamentals buoyed by stable fiscal and macro-economic policies.
It noted that the Indonesian administration in its 2016 draft budget pledged to drive growth further by increasing infrastructure spending by 8% to IDR314 trillion (RM93.2 billion) from IDR290 trillion and creating greater trade and investment opportunities by encouraging more foreign direct investment into the country.
Maybank said the move to increase infrastructure spending will greatly improve accessibility and interconnectivity as well as education and employment rates in the republic.
Maybank Kim Eng Group CEO John Chong said that the various infrastructure projects will have to be financed through the capital market.
“The capital market in particular the bond or sukuk market is an effective alternative to the bank market to finance the pipeline of infrastructure projects here in Indonesia. A deep IDR bond market will enable project sponsors to seek longer term fixed rate funding to provide certainty to their financing cost and match the IDR receivables received from these projects,” he said at the Invest Asean Indonesia conference held in Jakarta yesterday.