This report provides detailed market analysis, information and insights into the Indonesian construction market, including:
- The Indonesian construction market’s growth prospect 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
- Profiles of the ten largest construction projects in Indonesia
The Indonesian construction industry increased in value at a compounded annual growth rate (CAGR) of XX.XX% during the review period (2007–2011). Significant private and public investments were made in Indonesian commercial, industrial, infrastructural and residential construction projects. The country is in urgent need of new roads, railways, bridges, ports, airports, and energy and communication infrastructure to facilitate its economic growth. Indonesia’s infrastructure expenditure represents around XX.X% of the country’s GDP and it is thought that the government will spend IDR XX.X trillion (US$ XX.X billion) on infrastructure over the next five years through both public and private investments. Infrastructure construction contributed XX.XX% of the construction industry value in 2011 and grew at a CAGR of XX.XX% during the review period. Within the infrastructure construction market, road infrastructure was the largest category accounting for a XX.XX% share of the overall market. A new land acquisition law passed in 2011 will allow the government to purchase land held up by disputes and accelerate the completion of road infrastructure projects. As a result of such developments in road, energy and communication infrastructure, the infrastructure construction market is expected to record a CAGR of XX.XX% over the forecast period (2011–2016).
This report provides a comprehensive analysis of the construction industry in Indonesia:
- Historical (2007-2011) and forecast (2012-2016) 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
- Profiles of the top ten construction mega-projects in Indonesia by value
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- Evaluate competitive risk and success factors
- Increasing government spending on upgrading overall infrastructure, focusing on developing road, rail, energy and communication infrastructure, will provide growth opportunities in the Indonesian construction industry. Increasing population and urbanization will lead to a high demand for residential units. Indonesia also wants to develop other cities besides Bali and Jakarta as tourist destinations. This will need development of all types of infrastructural facilities. Indonesia’s mining sector has also received large investments for developing rail networks and ports to transport coal.
- The government of Indonesia has announced IDR2,202.9 trillion (US$250 billion) of funding for infrastructure development which will be spent in the years up to 2015. This will be funded by both public and private investment with more than 60% of the funding coming from private investment.
- Increasing fuel and input material costs has added to the pressure on construction companies. Despite high demand for residential units, prices are not going up as expected due to oversupply of housing units, high mortgage and interest rates (which have started to drop) and high inflation which discourages people from borrowing money.
- The existence of established construction companies in the country and entry of new foreign contractors has led to high competition in the Indonesian construction industry. A construction boom before the economic crisis has left Indonesia with a large supply of housing units.