Finding opportunities in the midst of economic recovery | Bahasa

Indonesia, 10 Sep 2020 - The Covid-19 pandemic has caused major changes in all aspects of life, particularly in the global economy. The pandemic has disrupted economic activities in many countries, including Indonesia whose Gross Domestic Product (GDP) contracted -5.32% yoy in the second quarter, the biggest decline in Indonesia's history. To revive the economy, the government has launched various stimuli to help people at all levels of society.

As a result of the implementation of the large-scale social restrictions (PSBB) in most areas in the second quarter to reduce the number of positive cases of Covid-19, a decline in economic performance was expected. Various sectors experienced a general decline. The clothing, footwear and maintenance services sectors declined -5.13%, transportation and communication decreased -15.3%, and restaurants and hotels, which were the most affected sectors, decreased -16.53%. Various efforts have been and continue to be made by the government to restore the economy. A number of stimuli in several sectors have been provided to assist the low-income group, such as direct cash assistance, food packages, pre-employment card programmes, to name a few. In the future, the stimuli will also be provided for middle-class consumers.

“Bank DBS Indonesia is also actively providing information that can help customers seize the opportunities that arise during the post-pandemic economic recovery period using various formats, including online talk shows. At the beginning of the pandemic in March, DBS quickly adapted to changes to meet customer needs for information about and leading insights into the economy & lifestyle, switching from face-to-face (offline) mode to virtual events or webinars. The DBS eTalk Series virtual event has been our routine since the beginning of the pandemic and is a manifestation of our commitment to be a trusted financial partner, providing economic views and guidance to seize various opportunities that exist. Thus, customers can always "Live more, Bank less", enjoy life without having to deal with the hassle of banking matters," said Consumer Banking Director PT Bank DBS Indonesia, Rudy Tandjung.

"I personally truly appreciate what Bank DBS Indonesia has done to provide the latest information and new insights for customers, especially in the midst of a situation like today. The information we get becomes our foundation for current investment opportunities. I hope that in the future there will be more useful discussions like this to be held by Bank DBS Indonesia," said Villysia Sianandar, a customer of Bank DBS Indonesia.

In a DBS eTalk Series session entitled "Finding Opportunities Amidst Ongoing Economic Recovery and Sustainable Consumerism" (26/8) held by PT Bank DBS Indonesia and PT Manulife Aset Manajemen Indonesia ("MAMI"), Katarina Setiawan, MAMI’s Chief Economist & Investment Strategist, said, "Several factors can stimulate the economy, especially in terms of consumption, in the second half of 2020, including payment of a 13th salary of civil servants (PNS) amounting to IDR28.5 trillion, assistance for Micro, Small and Medium Enterprises (MSMEs) amounting to Rp24 trillion, and cash-back vouchers worth Rp7.6 trillion to encourage people to buy MSME products through the ‘Bangga Buatan Indonesia’ programme. In addition, the government has also allocated Rp37 trillion to provide stimulus for four months for people earning less than Rp5 million per month."

Domestic consumption and household retail sales, which currently dominate up to 58% of Indonesia’s economy, are the main keys that drive Indonesia's GDP. On the same occasion, Hemant Bakshi, President Director of PT Unilever Indonesia, said, “As a consumer goods company with various brands that are very close to the Indonesian family life, we are committed to ensuring that our products continue to meet the needs of our consumers every day. Not only does it encourage us to continue to innovate and maximise decades of experience, the pandemic also makes us more adaptive, agile, attentive, and sharp in recognising demand patterns, and realising the desired results in current conditions. This is one way that we believe can help household consumption continue to increase so that together Indonesia can come out of this crisis more resilient than ever."

On the other hand, the pandemic does not mean that people cannot invest, although retail investors need to review their portfolios and adapt to embrace the new investment climate. Ronny Setiawan, Head of Trading, Treasury & Markets, PT Bank DBS Indonesia, said, “Many people think that saving in USD will be more profitable than saving in IDR, but you could say this is not entirely true. We see that the IDR has a tendency to strengthen due to the FED balance sheet expansion, especially with Bank Indonesia considering the implementation of the regulation on the conversion of export proceeds with a certain ratio, which will increase the supply of USD in the foreign exchange market.”

Regarding the depreciation of the rupiah, which was traded at Rp16,000 per US dollar at the start of the pandemic in Indonesia, Ronny said that this was only temporary. Gradually, the IDR has strengthened and is expected to trade at Rp14,000 to the dollar by the end of the year. "In the future, more investment opportunities will be in the IDR. Placing IDR in deposits with an interest rate of 6-7% long term and its depreciation in the last ten years, at around 3.98%, investing in IDR will yield more favourable results," Ronny concluded. 

 

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DBS is a leading financial services group in Asia with a presence in 18 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank's "AA-" and "Aa1" credit ratings are among the highest in the world.

Recognised for its global leadership, DBS has been named “World’s Best Bank” by Euromoney, “Global Bank of the Year” by The Banker and “Best Bank in the World” by Global Finance. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank” by Euromoney. In addition, DBS has been accorded the “Safest Bank in Asia” award by Global Finance for 11 consecutive years from 2009 to 2019.

DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets. DBS is committed to building lasting relationships with customers, and positively impacting communities through supporting social enterprises, as it banks the Asian way. It has also established a SGD 50 million foundation to strengthen its corporate social responsibility efforts in Singapore and across Asia.

With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. The bank acknowledges the passion, commitment and can-do spirit in all of our 29,000 staff, representing over 40 nationalities. For more information, please visit www.dbs.com.