M A R K E T
R E P O R T
COUNTRY FOCUS: INDONESIA
Paint sector benefits from Indonesia’s economic growth
The Indonesian paint market is expanding both locally and globally with the increase of government investment into building and infrastructure and the region’s expansion of exports and demand for higher quality products s Indonesia’s economy continues to grow so too does demand for paint and coatings in the region. In 2008, the archipelago recorded a 6.1% increase in gross domestic product (GDP), moving from a GDP per capita of US$3,700 in 2007 to US$3900 the following year (using purchasing power parity adjustments). With this growth the nation has seen an improvement in local transport and energy networks which require paints and coatings. “Growth is expected to continue as the Indonesian government focuses on upgrading and building a new infrastructure,” said Sheila Rajah, Frost & Sullivan market analyst. According to Frost’s research the country’s paint and coating market is valued at US$1bn with a market size of 639,128t. Although the outlook is positive, paint consumption per capita is currently at 2.8kg per person, “which is well below the [average] Asia level of 44.5kg per person,” added Ms Rajah.
high-end exterior paint. The company’s new line-up is in sync with the current trend of increased market demand for premium and mid-tier products. “Decorative coatings account for 60% of the industry value and 80% of the volume,” said Ms Rajah. The segment is showing high growth potential, while industrial paints – mainly wood coatings, automotive original equipment manufacturing (OEM), and refinish coatings – have felt the strain of the economic downturn. “90% of wood finishing material is exported to Western countries,” she said. “Growth is currently hampered by the drop in demand from the USA and Europe. Similarly the automotive OEM coating sector is also predicted to move faster in the coming years after the automotive industry recovers...
Please join StudyMode to read the full document