13Mar, 2023
SingCham Weekly 13 Mar: Second Highest Economic Growth Among G20

Monday, 13 March 2023

ECONOMY

Indonesia’s economic growth 2nd highest among G20
The global economic growth will start to slightly slow down in 2023 even though there would still be a number of Asian countries where their economies would continue to grow, according to a PwC report. Indonesia’s growth projection is below last year’s growth which reached 5.3%. However, the Indonesian government appears ready to mitigate the potential adverse effects of economic uncertainty by continuing to encourage investment and affirming its commitment to a green transition. PwC Global Economics Network estimates that the global economy will experience a slowdown even though it can avoid a global recession. The global economy will grow by 1.9% in 2023
Guideline on waste management investment needed
The Indonesian government should issue an investment guideline on waste management, according to a startup founder. The lack of a guideline has become one of the challenges that businesses in the sector face when trying to invest in districts and municipalities. This can help give a better understanding for both the subnational government and potential investors, which are key to attracting investment in waste management. Indonesia generates 175,000 tons of waste a day, about 48% from food waste.
Collapse of US tech-focused Silicon Valley Bank
US financial regulators have shut down Silicon Valley Bank and took control of its deposits. The collapse of SVB is the second-biggest bank collapse in US history. Venture capital investors have slowed down considerably on funding of startups, spooked by an uncertain economy, plunging tech stock prices and growing recession fears. In 4Q 2022, investments in North American startups fell 63% compared to the same period a year earlier. Some major factors for the freeze in tech funding are stock market turmoil which caused tech startup valuations to plummet, halt in market for tech IPOs and widespread tech layoffs. Venture capital firms have urged their portfolio companies to move funds out of the embattled lender Silicon Valley Bank, which was one of the reasons for a run on this tech-focused bank.
🇸🇬 Singapore CEOs believe their companies not viable if they continue on current path
Nearly 40% of CEOs surveyed in Singapore and globally believe their companies will not be economically viable in the next decade if they continue on their current path, according to a PwC survey. This “stark datapoint” underscores a dual imperative facing CEOs today — the need to manage short-term external risks to drive profitability in order to survive, while simultaneously transforming their business to thrive in the longer term. The Singapore findings of the survey also show that close to nine in 10 of CEOs surveyed in Singapore believe global economic growth will decline over the next 12 months, with this pessimism felt more strongly by Singapore business leaders (89%) than their global counterparts (73%).
🇸🇬 Economists expect GDP to grow by 1.9% in 2023
Singapore’s GDP is estimated to expand by 1.9% in 2023, according to the MAS March survey of professional forecasters. The latest estimate stands slightly above the previous forecast of 1.8% in the previous survey in December 2022. According to the 21 economists and analysts who responded to the survey, the most likely outcome is for the Singapore economy to grow by 2.0% to 2.9% in 2023 with an average probability of 34.3%. In the current survey, respondents also expect Singapore’s economy to grow by 1.3% in 1Q2023. At the same time, they have projected Singapore’s CPI-All Items inflation (or headline inflation) and MAS Core Inflation to come in at 6.5% and 5.5% in the first quarter respectively.

BUSINESS

BMW Special lease program for SCCI members
BMW Indonesia is pleased to inform you of a special lease program that is exclusively offered for SCCI members. The following lease calculation provided by BMW Financial Services. For further information please reach out at Telephone: 1500269, Whatsapp: +6285288886269 or Email: contact.id@bmw.co.id.

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Indonesia aims for $5bn in furniture export revenue in 2023

Indonesia is aiming for up to $5bn in furniture export revenue this year which can be achieved by improving raw material supplies and export funding scheme, Chief Economic Minister Airlangga Hartarto said. In the supply system, the government will provide certification to ensure that the materials used in the furniture industry come from sustainably managed forests. The Industry Ministry will shoulder the cost of certification, Airlangga said when opening the Indonesia International Furniture Expo in Jakarta. Government support was needed to strengthen Indonesia’s competitiveness over neighbouring Vietnam, whose furniture exports already topped $18bn  in value.  Indonesia, which has the comparative advantage in terms of raw material supplies, has the potential to become the regional leader in the furniture industry, the minister said.

Tokopedia helps women-owned MSMEs
Tokopedia is the first e-commerce company to collaborate with the government through the BKPM, to socialize and facilitate the attainment of Business Identification Number (NIB) to MSMEs. Throughout 2022, Tokopedia and the government have helped more than 5,000 MSMEs, including women entrepreneurs from all over Indonesia, to register for NIB. Various types of special training for women entrepreneurs, including those related to NIB, are carried out by Tokopedia together with strategic partners such as the government in various regions in Indonesia
Tax return submissions increase compared to last year
President Jokowi stated that the number of people filing their annual tax returns (SPT) has reached 6.6m as of 9 March. The figure increased compared to the previous year. To date, he has monitored that there are still many people who were lining up to file their SPT directly by visiting the Tax Service Office (KPP), “even though SPT can be done through e-Filing from home.” Deputy for Protocol, Press, and Media Secretariat of the President, Bey Machmudin, explained that the state head planned to submit his SPT in a different way this year. According to Bey, the visit was also aimed at campaigning for the SPT submission which falls every March and monitoring the tax office’s activity.
Singapore help for second-hand shoes scandal
The Minister of Industry Agus Gumiwang Kartasasmita will ask for the help of the Singapore government in investigating the illegally-imported second-hand shoes from the country that has ended up in Indonesian thrift markets. Agus suspected these imported shoes were brought into Indonesia in an organized manner. He considered this to be a major scandal, especially amidst the domestic footwear industry experiencing a contraction. The domestic footwear industry is experiencing a decline in sales due to falling demand from the export market. This condition occurs because Indonesia’s main export markets, such as the US and Europe, are experiencing high inflation.
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Garuda Indonesia’s beauty of Kembara Angkasa
Garuda Indonesia has launched a new thematic livery, the Beauty of Kembara Angkasa (space travel), which is the theme that highlights four colours of the clouds on its wings (light blue, dark blue, orange, purple) and the Mega Mendung batik that represents the colours of Garuda. This special livery is painted on its A330-900 Neo fleet, and would be serving several domestic and international routes during the year. The launch of the new livery is also one of Garuda Indonesia’s commitment to support and appreciate local talents as the national flag carrier.
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Banker sentenced to 10 years in prison for 1MDB corruption
Former Goldman Sachs banker Roger Ng was sentenced to 10 years in prison, after he was convicted of helping loot billions of dollars from Malaysia’s 1MDB sovereign wealth fund. The charges stem from some $6.5bn in bonds that Goldman helped 1MDB, which was founded to finance development projects in Malaysia. US prosecutors said $4.5bn of that sum was embezzled by officials, bankers and their associates, in one of the biggest scandals in Wall Street history. Funds were used to buy high-end real estate, jewelry and artwork, and finance the Hollywood film, “The Wolf of Wall Street.”
🇸🇬 Sea cuts more jobs at Shopee days after posting surprise profit
Sea Limited is cutting more jobs at e-commerce unit Shopee in Indonesia, days after reporting a surprise first-ever quarterly profit helped by last year’s extensive firings. The latest cuts affect fewer than 500 full-time and contract workers in Shopee’s customer service team in Indonesia, according to a person with direct knowledge of the matter. The Singapore-based e-commerce, gaming and fintech provider last year cut more than 7,000 jobs, froze salaries and trimmed spending, helping it to swing to a profit in the fourth quarter. SE Asia’s largest Internet firm racked up its biggest single-day gain in months after reporting the surprise profit – energising investors who are hoping that the company will pull off one of the biggest turnaround efforts the region’s fledgling tech sector has ever witnessed.
🇸🇬 Temasek’s SeaTown invests $150m to set up medical group foundation
SeaTown Holdings, the investment manager indirectly owned by state investor Temasek, has invested $150m to establish a new Singapore-based medical group, Foundation Healthcare Holdings (FHH). Established on Wednesday, FHH comprises 50 medical specialists across 13 areas of expertise, such as cardiology and general surgery. It is estimated to have a pro forma revenue of over $130m, making it one of Singapore’s largest private healthcare groups, SeaTown said. The company will also develop a data-driven tech platform to improve coordination between stakeholders, especially insurers and other third-party payers. It will tap the capabilities of its healthtech unit, Smarter Health – led by former Parkway East Hospital chief executive Choy Shook Yee.
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SOCIAL
Satya Bumi public environmental discussion hampered by infiltrator
Satya Bumi Executive Director Andi Muttaqien stated that efforts to forcibly disband public discussions are violations against freedom of expression. His statement came after a man today attempted to disperse a public discussion held by the environmental NGO that highlighted the Batang Toru hydropower project, which threatens the Tapanuli orangutan habitat. Satya Bumi in collaboration with the Society of Indonesian Environmental Journalists (SIEJ) held a discussion entitled ‘The Future of the Tapanuli Orangutan and the Batang Toru Ecosystem’. The discussion was scheduled to take place in South Jakarta.
🇸🇬 Padang nominated for Unesco World Heritage Site
The NHB announced that the Padang, along with the civic architecture surrounding it, has been added to Singapore’s tentative list for nomination to be recognised as a Unesco World Heritage Site. The president of the SRC Chang Yeh Hong said that with the Padang and its surrounding buildings potentially becoming a Unesco World Heritage Site, the club could gain greater prominence here and globally. However, he is wary that possible restrictions placed by Unesco could limit the club’s ability to expand its infrastructure and facilities. Urban planners and heritage experts also said that the Unesco bid could enhance and protect the heritage value of the Padang area.
🇸🇬 Overseas Singaporeans may vote by post in future elections
Eligible Singaporeans living overseas will be able to vote by post in future elections as part of changes to the country’s election laws passed in Parliament. Other changes include having special voting arrangements for nursing home residents and updates to rules for online election advertising. These amendments to the Presidential Elections Act and Parliamentary Elections Act are in line with the Elections Department’s “continuous efforts to enhance… electoral processes and election administration”, said Education Minister Chan Chun Sing as he tabled the Bills for a second reading. The Bills were passed in Parliament, although the nine MPs from the Workers’ Party (WP) abstained from the vote to amend the Presidential Elections Act.
🇸🇬 Singapore raises residency hurdles as popularity grows
Foreigners seeking permanent residency in Singapore through the Global Investor Programme (GIP) will soon have to stake larger investment quanta in order to qualify. From 15 March, the GIP will require individuals to invest at least $10m in a business or $25m  in an approved fund. Establishing a single family office under the GIP will now require at least $50m to be deployed and maintained in any of four investment categories. The Economic Development Board (EDB) says the changes are meant to direct more support to the local start-up ecosystem and the broader financial sector, as well as generate more “good jobs” for Singaporeans. With many jurisdictions “competing to attract high-calibre business owners and owners of capital”, EDB, a statutory board under the Ministry of Trade and Industry, says it aims to selectively attract individuals with the abilities to create greater economic impact for Singapore and the “affinity” to be “more rooted” to the country.
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TECH 
Powerful bandwidth, data center needed for NIK
Home Affairs Minister Tito Karnavian said that Indonesia would need to upgrade its civil registry data center as the country tries to adopt e-government based on the national ID numbers or locally known as the NIK. The data centre infrastructure at the Civil Registry Agency (Disdukcapil) has remained relatively the same since 2013. As the demand for NIK data grows, coupled with an expanding population, so does the need to upgrade the data centre. The Finance Ministry is currently working on a single identification number scheme for taxpayers. By 2024, the NIK will entirely replace the tax identification cards (NPWP). The population is currently at 278m in 2023.
EU seeks funding for 5G and broadband
The Netherlands warned against hitting Big Tech with a so-called internet toll to help pay for billions of euros in network investments, saying such a move may breach net neutrality rules and lead to price hikes for Europeans. The comments marked the first comment after EU industry chief Thierry Breton asked who should foot the bill to roll out costly 5G and broadband. Among the companies that said an internet tax would undermine EU rules to treat all users equally are Alphabet Inc’s Google, Apple Inc, Meta Platforms Inc, Netflix Inc, Amazon.com Inc and Microsoft Corp. There is this concern that EU infrastructure is not able to meet consumer expectations.
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