Indonesia has fewest local investors

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jakarta tuktuksInvestors in Indonesia account for only 0.2 per cent of the country’s total population, the lowest in the region, an executive in capital market supervision said according to the Jakarta Post.

“Compared to other Asian countries, Indonesia also has the lowest number of publicly listed companies,” Nurhaida, commissioner at the Financial Services Authority (OJK), told the in Citibank’s 2014 capital market outlook seminar on November 18.

She added that to date the Indonesia Stock Exchange had listed only 479 companies, followed by Thailand with 577 companies. India topped the list in Asia with 5,267 companies. She said the lack of domestic investors left Indonesia “vulnerable to negative sentiments among foreign investors”.

Citibank Indonesia chief country officer Tigor Siahaan echoed Nurhaida’s statements, saying that the country’s capital markets were affected by the uncertainty in the global economy.

“For example, our markets are going to be affected by the Federal Reserve’s tapering of its quantitative easing policy in 2014, which may disrupt the economy, including credit growth,” he said.

According to Nurhaida, corporate bonds, derivatives and mutual funds still experienced suboptimal growth in Indonesia due to a shortage of domestic investors. She said that domestic investors were still reluctant to invest in corporate bonds, derivatives and mutual funds because they perceived the instruments to have a limited market size and therefore, costly.

Although Indonesia’s market capitalisation had doubled from $179.75 billion in 2009 until November 2013 and average daily trading volume had increased by 1.5 times, there were still too few domestic investors, she said, adding that Indonesia needed more domestic investors to stabilise its capital markets.

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Reading Time: 2 minutes

Investors in Indonesia account for only 0.2 per cent of the country’s total population, the lowest in the region, an executive in capital market supervision said according to the Jakarta Post.

Reading Time: 2 minutes

jakarta tuktuksInvestors in Indonesia account for only 0.2 per cent of the country’s total population, the lowest in the region, an executive in capital market supervision said according to the Jakarta Post.

“Compared to other Asian countries, Indonesia also has the lowest number of publicly listed companies,” Nurhaida, commissioner at the Financial Services Authority (OJK), told the in Citibank’s 2014 capital market outlook seminar on November 18.

She added that to date the Indonesia Stock Exchange had listed only 479 companies, followed by Thailand with 577 companies. India topped the list in Asia with 5,267 companies. She said the lack of domestic investors left Indonesia “vulnerable to negative sentiments among foreign investors”.

Citibank Indonesia chief country officer Tigor Siahaan echoed Nurhaida’s statements, saying that the country’s capital markets were affected by the uncertainty in the global economy.

“For example, our markets are going to be affected by the Federal Reserve’s tapering of its quantitative easing policy in 2014, which may disrupt the economy, including credit growth,” he said.

According to Nurhaida, corporate bonds, derivatives and mutual funds still experienced suboptimal growth in Indonesia due to a shortage of domestic investors. She said that domestic investors were still reluctant to invest in corporate bonds, derivatives and mutual funds because they perceived the instruments to have a limited market size and therefore, costly.

Although Indonesia’s market capitalisation had doubled from $179.75 billion in 2009 until November 2013 and average daily trading volume had increased by 1.5 times, there were still too few domestic investors, she said, adding that Indonesia needed more domestic investors to stabilise its capital markets.

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