JAKARTA (TheInsiderStories) – Good morning. Malaysia’s Grab had claimed that it is number one in Indonesia’s ride-hailing market, beating its fierce competitor Go-Jek, which is busy making overseas expansion.
Grab’s Indonesia Managing Director Ridzki Kramadibrata said the company now controls 65 percent of Indonesia’s ride-hailing market, which means Go-Jek holds the remaining 35 per cent as the only competitor.
This dominance is a product of Grab’s aggressiveness and business dealings. Grab managed to expand its reach from merely 12 Indonesian cities to 137 at present. Also, Grab acquired Uber’s Southeast Asia businesses through a merger deal announced this year.
It would be interesting to see a response from Go-Jek, which has been expanding into other Southeast Asia countries in a US$500 million drive after building up a strong foothold in Indonesia.
Moving on, another major development on Wednesday (29/08) is the appointment of Nicke Widyawati as the chief executive officer of state-owned energy producer PT Pertamina. This has been long expect as her has built up a strong rapporteur as state companies executives.
However, a surprise came from the appointment of Darmawan Samsu, a country head of BP Indonesia, as Pertamina’s upstream director. While Samsu is an industry veteran, he has relatively little experience with navigating the intricacies of state owned enterprises, particularly one as politically-charged as Pertamina.
Meanwhile The new Australian Prime Minister Scott Morrison is scheduled to visit Indonesia and meet with President Joko Widodo on Friday (31/08), during which a comprehensive economic partnership agreement between both countries will be unveiled.
There are few details that need to be agreed upon, but Indonesian officials show optimism that the document will be ready for signing on Friday. The pact is expected to make Indonesia as a manufacturing base for Australian companies, though it remains unclear on whether Indonesia’s wish for greater labour access in Australia will be granted.
From overseas, the second reading of United States economic growth in the second quarter revised up the earlier figure from previously 4.1 per cent to 4.2 per cent, which is the best performance in nearly four years.
Higher economic growth dampened the appealed of emerging market assets like Indonesia. Foreign investors pulled out Rp480.7 billion from Indonesia equity market yesterday, though the Jakarta Composite Index still ended up 0.4 per cent at 6,065.1.
Rupiah recorded a steep drop at 14,653 per US$1 from 14,614 per US$1 due to accelerating growth of the US economy.
Sentiment on emerging market also came from rating agency Moody’s decision to downgrade 20 Turkish financial institutions and sent a warning of ‘heightened risk’ from the ongoing financial crisis in Turkey. The downgrade sent the Turkish lira to plunge and spread to other emerging market currencies.
May you have a profitable day.