Construction in Indonesia – Key Trends and Opportunities to 2017

• Publication date: May 2013
• Report size: 71 pages

Synopsis This report provides detailed market analysis, information and insights into the Indonesian construction market, including: • The Indonesian construction market’s growth prospects by sector, project type and type of construction activity • Analysis of equipment, material and service costs across each project type within Indonesia • Critical insight into the impact of industry trends and issues and the risks and...

Synopsis
This report provides detailed market analysis, information and insights into the Indonesian construction market, including:
• The Indonesian construction market’s growth prospects by sector, project type and type of construction activity
• Analysis of equipment, material and service costs across each project type within Indonesia
• Critical insight into the impact of industry trends and issues and the risks and opportunities they present to participants in the Indonesian construction market
• Assessment of the competitive forces facing the construction industry in Indonesia and profiles of the leading players
• Data highlights of the largest construction projects in Indonesia

Summary
Indonesia’s construction industry has performed well during the review period, driven by strong economic activity and high levels of investment. Fixed investment has soared over the past decade, with its share of total GDP rising from 19.5% in 2003 to a high of 33.2% in 2012. The construction industry has been a clear beneficiary of this investment, and has grown by 7.4% on an annual average basis, in real terms, over the past 10 years, well above the GDP growth rate of 5.9%. It maintained this rate of growth in 2012, expanding by 7.5%. In line with this trend, the construction sector’s share of total GDP increased from 6.2% in 2003 to 10.4% in 2012. Despite some challenges, the outlook for construction is favorable, supported by urbanization, rising incomes and government efforts to improve the infrastructure base as a part of its ambitious multiyear Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development (MP3EI).

Scope
This report provides a comprehensive analysis of the construction industry in Indonesia:
• Historical (2008-2012) and forecast (2013-2017) valuations of the construction market in Indonesia using the construction output and value-add methods
• Segmentation by sector (commercial, industrial, infrastructure, institutional and residential) and by project type
• Breakdown of values within each project type, by type of activity (new construction, repair and maintenance, refurbishment and demolition) and by type of cost (materials, equipment and services)
• Analysis of key construction industry issues, including regulation, cost management, funding and pricing
• Assessment of the competitive environment using Porter’s Five Forces
• Detailed profiles of the leading construction companies in Indonesia

Reasons To Buy
• Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
• Assess market growth potential at a micro-level via 600+ time series data forecasts
• Understand the latest industry and market trends
• Formulate and validate business strategies by leveraging our critical and actionable insight
• Assess business risks, including cost, regulatory and competitive pressures
• Evaluate competitive risk and success factors

Key Highlights
• Indonesia’s medium-term economic prospects are positive and investor confidence is building. With continued strong domestic demand growth offsetting weaknesses on the external side, real GDP growth is forecast to be in the range of 6–6.5% a year in the next two years. The forecast expansion in Indonesia’s middle class, rising urbanization and labor force participation underpin the projection of real GDP growth of 6–7% a year between 2015 and 2017.
• The government has succeeded in maintaining a deficit consistently below 3% of GDP over the past 10 years. It has also managed to reduce its debt burden from a peak of 77% of GDP in 2001 to just 24% in 2012. It is partly due to improvements in the government’s fiscal health that international credit ratings agencies have upgraded Indonesia’s sovereign credit ratings, with Fitch and Moody’s returning investment-grade status to Indonesia.
• Indonesia has attracted massive foreign direct investment during the review period, with the total rising to US$24.6 billion in 2012. However, the share attracted by the construction sector has fallen, from a high of US$618.4 million in 2010 to just US$240 million in 2012. Although FDI in the construction industry has been disappointing, domestic companies ramped up investment spending in 2012.
• A new bill on land procurement was passed in December 2011. Under this law, the government is obliged to provide land and can purchase property at market value, reducing the potential for speculators to buy and sell property at exorbitant rates and cause delays in projects. This law is expected to accelerate infrastructure projects over the forecast period.
• The government of Indonesia announced a new regulation in May 2012 which allows foreigners to own property in Indonesia. However, ownership has been limited to condominiums only. According to the new regulation, foreigners must first apply for a Building Ownership Certificate (SKBG) and then they can own an apartment unit without the need to own land. The SKBG may be held for 60 years, with a provision to extend it for another 60 years. The move is expected to attract considerable foreign investment in the housing sector.

Building And Engineering Industry in Indonesia

Table of Contents
1 Executive Summary
2 Market Overview
2.1 The Domestic Economy
2.2 Key Trends and Issues
2.3 Key Construction Indicators
2.4 Benchmarking by Market Size and Growth
2.5 Price Dynamics
2.5.1 Salaries
2.5.2 Equipment
2.5.3 Materials
2.5.4 Energy
2.6 Porters Five Forces Analysis of the Indonesian Construction Industry
2.6.1 Bargaining power of supplier – medium
2.6.2 Bargaining power of buyer – medium
2.6.3 Barriers to entry – medium
2.6.4 Intensity of rivalry – high
2.6.5 Threat of substitution – low
2.7 Demographic Profile
3 Commercial Construction
3.1 Performance Outlook
3.2 Key Issues
3.3 Data and Project Highlights
4 Industrial Construction
4.1 Performance Outlook
4.2 Key Issues
4.3 Data and Project Highlights
5 Infrastructure Construction
5.1 Performance Outlook
5.2 Key Issues
5.3 Data and Project Highlights
6 Institutional Construction
6.1 Performance Outlook
6.2 Key Issues
6.3 Data and Project Highlights
7 Residential Construction
7.1 Performance Outlook
7.2 Key Issues
7.3 Data and Project Highlights
8 Company Profile: PT PLN (Persero)
8.1 PT PLN (Persero) – Company Overview
8.2 PT PLN (Persero) – Main Products and Services
8.3 PT PLN (Persero) – Company Information
8.3.1 PT PLN (Persero) – key competitors
8.3.2 PT PLN (Persero) – key employees
9 Company Profile: PT Wijaya Karya (Persero) Tbk
9.1 PT Wijaya Karya (Persero) Tbk – Company Overview
9.2 PT Wijaya Karya (Persero) Tbk – Main Products and Services
9.3 PT Wijaya Karya (Persero) Tbk – Company Information
9.3.1 PT Wijaya Karya (Persero) Tbk – key competitors
9.3.2 PT Wijaya Karya (Persero) Tbk – key employees
10 Company Profile: PT Bakrie & Brothers Tbk
10.1 PT Bakrie & Brothers Tbk – Company Overview
10.2 PT Bakrie & Brothers Tbk – Main Products and Services
10.3 PT Bakrie & Brothers Tbk – Company Information
10.3.1 PT Bakrie & Brothers Tbk – key competitors
10.3.2 PT Bakrie & Brothers Tbk – key employees
11 Company Profile: PT Waskita Karya
11.1 PT Waskita Karya – Company Overview
11.2 PT Waskita Karya – Main Services
11.3 PT Waskita Karya – Company Information
11.3.1 PT Waskita Karya – key competitors
11.3.2 PT Waskita Karya – key employees
12 Company Profile: PT Adhi Karya (Persero) Tbk
12.1 PT Adhi Karya (Persero) Tbk – Company Overview
12.2 PT Adhi Karya (Persero) Tbk – Business Description
12.3 PT Adhi Karya (Persero) Tbk – Main Services
12.4 PT Adhi Karya (Persero) Tbk – History
12.5 PT Adhi Karya (Persero) Tbk – Company Information
12.5.1 PT Adhi Karya (Persero) Tbk – key competitors
12.5.2 PT Adhi Karya (Persero) Tbk – key employees
13 Market Data Analysis
13.1 Construction Output and Value Add
13.1.1 Construction output by project type
13.1.2 Construction output by cost type
13.1.3 Construction output by activity type
13.1.4 Construction value add by project type
13.2 Commercial Construction
13.2.1 Commercial construction output by project type
13.2.2 Commercial construction output by cost type
13.2.3 Commercial construction output by activity type
13.2.4 Commercial construction value add by project type
13.3 Industrial Construction
13.3.1 Industrial construction output by project type
13.3.2 Industrial construction output by cost type
13.3.3 Industrial construction output by activity type
13.3.4 Industrial construction value add by project type
13.4 Infrastructure Construction
13.4.1 Infrastructure construction output by project type
13.4.2 Infrastructure construction output by cost type
13.4.3 Infrastructure construction output by activity type
13.4.4 Infrastructure construction value add by project type
13.5 Institutional Construction
13.5.1 Institutional construction output by project type
13.5.2 Institutional construction output by cost type
13.5.3 Institutional construction output by activity type
13.5.4 Institutional construction value add by project type
13.6 Residential Construction
13.6.1 Residential construction output by project type
13.6.2 Residential construction output by cost type
13.6.3 Residential construction output by activity type
13.6.4 Residential construction value add by project type
14 Appendix
14.1 What is this report about?
14.2 Definitions
14.3 Summary Methodology
14.4 Methodology
14.5 Contact Us
14.6 About Timetric
14.7 Our Services
14.7.1 Core capabilities include:
14.8 Disclaimer


List of Tables

Table 1: Project 1: RG – Jumeirah Bali Resort – Indonesia
Table 2: Project 2: Keppel Land – International Financial Centre Office Tower II Development – Jakarta
Table 3: Project 3: ELTY – Sukabumi Mixed-Use Development – West Java
Table 4: Project 1: Hankook – Cikarang Tire Manufacturing Plant Expansion – West Java
Table 5: Project 2: Pusri – Pusri IIB Fertilizer Factory – Lampung
Table 6: Project 3: INPL – Bulungan Nickel Refinery: Nickel Pig Iron Smelter – East Kalimantan
Table 7: Project 1: MPW – Pekanbaru-Dumai Toll Road – Riau Province
Table 8: Project 2: Pelindo II – Tanjung Priok Port Expansion – Jakarta
Table 9: Project 3: Chevron – Gendalo-Gehem Natural Gas Fields Development – Indonesia
Table 10: Project 1: FKUI – Jakarta Medical Education and Research Center – Indonesia
Table 11: Project 2: OBO – New US Embassy Compound – Jakarta
Table 12: Project 3: KFH – Kimia Farma Liver Center – Jakarta
Table 13: Project 1: GoI – Tangerang Satellite City – Banten
Table 14: Project 2: CTRS – Ciputra World Surabaya – Indonesia
Table 15: Project 3: APG – Bogor Housing-Resort Development – West Java
Table 16: PT PLN (Persero), Key Facts
Table 17: PT PLN (Persero), Main Products and Services
Table 18: PT PLN (Persero), Key Employees
Table 19: PT Wijaya Karya (Persero) Tbk, Key Facts
Table 20: PT Wijaya Karya (Persero) Tbk, Main Products and Services
Table 21: PT Wijaya Karya (Persero) Tbk, Key Employees
Table 22: PT Bakrie & Brothers Tbk, Key Facts
Table 23: PT Bakrie & Brothers Tbk, Main Products and Services
Table 24: PT Bakrie & Brothers Tbk, Key Employees
Table 25: PT Waskita Karya, Key Facts
Table 26: PT Waskita Karya, Main Services
Table 27: PT Waskita Karya, Key Employees
Table 28: PT Adhi Karya (Persero) Tbk, Key Facts
Table 29: PT Adhi Karya (Persero) Tbk, Main Services
Table 30: PT Adhi Karya (Persero) Tbk, History
Table 31: PT Adhi Karya (Persero) Tbk, Key Employees
Table 32: Indonesian Construction Output by Project Type (IDR Million), 2008–2012
Table 33: Indonesian Commercial Construction Output by Project Type (IDR Million), 2012–2017
Table 34: Indonesian Construction Output by Cost Type (IDR Million), 2008–2012
Table 35: Indonesian Construction Output by Cost Type (IDR Million), 2012–2017
Table 36: Indonesian Construction Output by Activity Type (IDR Million), 2008–2012
Table 37: Indonesian Construction Output by Activity Type (IDR Million), 2012–2017
Table 38: Indonesian Construction Value Add by Project Type (IDR Million), 2008–2012
Table 39: Indonesian Construction Value Add by Project Type (IDR Million), 2012–2017
Table 40: Indonesian Commercial Construction Output by Project Type (IDR Million), 2008–2012
Table 41: Indonesian Commercial Construction Output by Project Type (IDR Million), 2012–2017
Table 42: Indonesian Commercial Construction Output by Cost Type (IDR Million), 2008–2012
Table 43: Indonesian Commercial Construction Output by Cost Type (IDR Million), 2012–2017
Table 44: Indonesian Commercial Construction Output by Activity Type (IDR Million), 2008–2012
Table 45: Indonesian Commercial Construction Output by Activity Type (IDR Million), 2012–2017
Table 46: Indonesian Commercial Construction Value Add by Project Type (IDR Million), 2008–2012
Table 47: Indonesian Commercial Construction Value Add by Project Type (IDR Million), 2012–2017
Table 48: Indonesian Industrial Construction Output by Project Type (IDR Million), 2008–2012
Table 49: Indonesian Industrial Construction Output by Project Type (IDR Million), 2012–2017
Table 50: Indonesian Industrial Construction Output by Cost Type (IDR Million), 2008–2012
Table 51: Indonesian Industrial Construction Output by Cost Type (IDR Million), 2012–2017
Table 52: Indonesian Industrial Construction Output by Activity Type (IDR Million), 2008–2012
Table 53: Indonesian Industrial Construction Output by Activity Type (IDR Million), 2012–2017
Table 54: Indonesian Industrial Construction Value Add by Project Type (IDR Million), 2008–2012
Table 55: Indonesian Industrial Construction Value Add by Project Type (IDR Million), 2012–2017
Table 56: Indonesian Infrastructure Construction Output by Project Type (IDR Million), 2008–2012
Table 57: Indonesian Infrastructure Construction Output by Project Type (IDR Million), 2012–2017
Table 58: Indonesian Infrastructure Construction Output by Cost Type (IDR Million), 2008–2012
Table 59: Indonesian Infrastructure Construction Output by Cost Type (IDR Million), 2012–2017
Table 60: Indonesian Infrastructure Construction Output by Activity Type (IDR Million), 2008–2012
Table 61: Indonesian Infrastructure Construction Output by Activity Type (IDR Million), 2012–2017
Table 62: Indonesian Infrastructure Construction Value Add by Project Type (IDR Million), 2008–2012
Table 63: Indonesian Infrastructure Construction Value Add by Project Type (IDR Million), 2012–2017
Table 64: Indonesian Institutional Construction Output by Project Type (IDR Million), 2008–2012
Table 65: Indonesian Institutional Construction Output by Project Type (IDR Million), 2012–2017
Table 66: Indonesian Institutional Construction Output by Cost Type (IDR Million), 2008–2012
Table 67: Indonesian Institutional Construction Output by Cost Type (IDR Million), 2012–2017
Table 68: Indonesian Institutional Construction Output by Activity Type (IDR Million), 2008–2012
Table 69: Indonesian Institutional Construction Output by Activity Type (IDR Million), 2012–2017
Table 70: Indonesian Institutional Construction Value Add by Project Type (IDR Million), 2008–2012
Table 71: Indonesian Institutional Construction Value Add by Project Type (IDR Million), 2012–2017
Table 72: Indonesian Residential Construction Output by Project Type (IDR Million), 2008–2012
Table 73: Indonesian Residential Construction Output by Project Type (IDR Million), 2012–2017
Table 74: Indonesian Residential Construction Output by Cost Type (IDR Million), 2008–2012
Table 75: Indonesian Residential Construction Output by Cost Type (IDR Million), 2012–2017
Table 76: Indonesian Residential Construction Output by Activity Type (IDR Million), 2008–2012
Table 77: Indonesian Residential Construction Output by Activity Type (IDR Million), 2012–2017
Table 78: Indonesian Residential Construction Value Add by Project Type (IDR Million), 2008–2012
Table 79: Indonesian Residential Construction Value Add by Project Type (IDR Million), 2012–2017
Table 80: Timetric Construction Market Definitions

List of Figures
Figure 1: Growth Matrix for Construction Output in Indonesia
Figure 2: Indonesian Economic Outlook
Figure 3: Construction Gross Valued Added (IDR Billion)
Figure 4: Bank Credit to Construction (IDR Billion)
Figure 5: Residential Property Prices (2002=100)
Figure 6: Benchmarking with Other Major Markets
Figure 7: Indonesia’s Population
Figure 8: Indonesian Commercial Construction Output (US$ Million)
Figure 9: Indonesian Industrial Construction Output (US$ Million)
Figure 10: Indonesian Infrastructure Construction Output (US$ Million)
Figure 11: Indonesian Institutional Construction Output (US$ Million)
Figure 12: Indonesian Residential Construction Output (US$ Million)
Figure 13: Indonesian Construction Output by Project Type (IDR Million) 2008–2017
Figure 14: Indonesian Construction Output by Cost Type (IDR Million) 2008–2017
Figure 15: Indonesian Construction Output by Activity Type (IDR Million) 2008–2017
Figure 16: Indonesian Construction Value Add by Project Type (IDR Million) 2008–2017
Figure 17: Indonesian Commercial Construction Output by Project Type (IDR Million) 2008–2017
Figure 18: Indonesian Commercial Construction Output by Cost Type (IDR Million) 2008–2017
Figure 19: Indonesian Commercial Construction Output by Activity Type (IDR Million) 2008–2017
Figure 20: Indonesian Commercial Construction Value Add by Project Type (IDR Million) 2008–2017
Figure 21: Indonesian Industrial Construction Output by Project Type (IDR Million) 2008–2017
Figure 22: Indonesian Industrial Construction Output by Cost Type (IDR Million) 2008–2017
Figure 23: Indonesian Industrial Construction Output by Activity Type (IDR Million) 2008–2017
Figure 24: Indonesian Industrial Construction Value Add by Project Type (IDR Million) 2008–2017
Figure 25: Indonesian Infrastructure Construction Output by Project Type (IDR Million) 2008–2017
Figure 26: Indonesian Infrastructure Construction Output by Cost Type (IDR Million) 2008–2017
Figure 27: Indonesian Infrastructure Construction Output by Activity Type (IDR Million) 2008–2017
Figure 28: Indonesian Infrastructure Construction Value Add by Project Type (IDR Million) 2008–2017
Figure 29: Indonesian Institutional Construction Output by Project Type (IDR Million) 2008–2017
Figure 30: Indonesian Institutional Construction Output by Cost Type (IDR Million) 2008–2017
Figure 31: Indonesian Institutional Construction Output by Activity Type (IDR Million) 2008–2017
Figure 32: Indonesian Institutional Construction Value Add by Project Type (IDR Million) 2008–2017
Figure 33: Indonesian Residential Construction Output by Project Type (IDR Million) 2008–2017
Figure 34: Indonesian Residential Construction Output by Cost Type (IDR Million) 2008–2017
Figure 35: Indonesian Residential Construction Output by Activity Type (IDR Million) 2008–2017
Figure 36: Indonesian Residential Construction Value Add by Project Type (IDR Million) 2008–2017



Companies Mentioned

PT PLN (Persero)
PT Wijaya Karya (Persero) Tbk
PT Bakrie & Brothers Tbk
PT Waskita Karya
PT Adhi Karya (Persero) Tbk

Building and Engineering in Indonesia

Indonesia Roads And Bridges Infrastructure Industry Value, % Of Transport Infrastructure

• $ 250
• Industry data
• February 2013

Yearly, From 2006 To 2022
By Business Monitor International
Source: Local news sources, industry sources, BMI Research (Major Projects Database)

• Industries : Building and Engineering
• Countries : Indonesia

Indonesia Roads And Bridges Infrastructure Industry Value Real Growth, % Y-o-y

• $ 250
• Industry data
• February 2013

Yearly, From 2007 To 2021
By Business Monitor International
Source: Local news sources, industry sources, BMI Research (Major Projects Database)

• Industries : Building and Engineering
• Countries : Indonesia

Indonesia Roads And Bridges Infrastructure Industry, % Of Total Infrastructure

• $ 250
• Industry data
• February 2013

Yearly, From 2006 To 2022
By Business Monitor International
Source: Local news sources, industry sources, BMI Research (Major Projects Database)

• Industries : Building and Engineering
• Countries : Indonesia

Indonesia Railways Infrastructure Industry Value, Idrbn

• $ 250
• Industry data
• February 2013

Yearly, From 2006 To 2022
By Business Monitor International
Source: Local news sources, industry sources, BMI Research (Major Projects Database)

• Industries : Building and Engineering
• Countries : Indonesia

Indonesia Railways Infrastructure Industry Value, Us$bn

• $ 250
• Industry data
• February 2013

Yearly, From 2006 To 2021
By Business Monitor International
Source: Local news sources, industry sources, BMI Research (Major Projects Database)

• Industries : Building and Engineering
• Countries : Indonesia