Indonesian retailers eye 10 percent growth in sales this year

The atmosphere at Tanah Abang Market, Southeast Asia’s biggest retail market, is always full of customers, especially ahead of religious holidays. (Kompas.com/Roderick Adrian Mozes)

The Association of Indonesian Retailers (Aprindo) has said retail sales potentially has grown 10 percent this year as a result of better macroeconomic and banking conditions.
Aprindo chairman Roy N. Mandey forecasts that the sales turnover of the country’s retailers has reached Rp 200 trillion (US$14.9 billion) for the year, higher than last year’s figure of Rp 181 trillion.
“Last year, with around 4.7 percent economic growth, we had posted growth of 8 percent. We hope this year we can book 10 percent growth,” Roy told reporters on Wednesday.

He added that one of the factors that positively affected growth in the retail industry was the country's low inflation levels of below 4 percent, which had triggered higher consumer spending. 

Furthermore, Roy asserted, the growth in the retail industry this year had also been supported by relatively stable electricity rates, and gas and oil prices.
“The central bank had cut its rate thus the lending rate that earlier amounted to between 10 and 12 percent, now stands at around 9 percent,” he said. 

Bank Indonesia (BI) had decided to cut its seven-day reverse repo rate to 4.75 percent, its sixth cut this year to jack up the economy.
Roy said retail sales normally surged twice a year, around Idul Fitri and before the New Year, during which retailers usually could book close to double-digit growth. (dan)