Indonesia

Doing Business in Indonesia

Indonesia is the largest archipelago globally, consisting of five major islands: Java, Sumatra, Kalimantan, Sulawesi, and Papua. A highly multi-ethnic and multi-cultural democratic country, Indonesia is the fourth most populous country worldwide – home to over 250 million people with over 300 regional languages. Recently characterised by stable politics and economic growth, with the largest economy in South-East Asia (boasting nearly half the region’s GDP), the rewards of doing business in Indonesia can be vast.

Despite only narrowly achieving a spot in the top half of countries ranked in the Ease of Doing Business ratings, Indonesia has recently become a more attractive prospect. Its government has focused on actively encouraging foreign investment in the country and ameliorating the regulatory and economic environment. Rivers, rainfall, and the fertile soil from volcanic activity make Indonesia a large exporter of raw materials. Its exports include nickel, gold, coffee, and coal, and it’s the world’s largest producer and exporter of crude palm oil. Combining its strong domestic consumption and expanding economy, Indonesia is a smart move for globally expanding companies.

However, businesses should prepare for some challenges when working in Indonesia. Prepare for a complex bureaucracy, a lack of transparency, poor infrastructure and high logistics costs. The mix of various cultures can prove beneficial, but beware of some social unrest.

Indonesian people are generally very polite and friendly, readily offering their hospitality. Decision-making and business dealings are often based on mutual agreement and consensus, while business is heavily relationship-focused. Naturally, it is necessary to foster deep connections with partners.

For expanding you business into this rapidly developing country, World Business Culture has all the information you need.

Author

This country-specific business culture profile was written by Keith Warburton who is the founder of the cultural awareness training consultancy Global Business Culture. 

Global Business culture is a leading training provider in the fields of cross-cultural communication and global virtual team working.  We provide training to global corporations in live classroom-based formats, through webinars and also through our cultural awareness digital learning hub, Global Business Compass.

This World Business Culture profile is designed as an introduction to business culture in Indonesia only and a more detailed understanding needs a more in-depth exploration which we can provide through our training and consultancy services.