I

ndonesia is the third most attractive investment location in the Asia-Pacific region, trailing behind the Philippines and Malaysia, according to a recent survey by PT Manulife Indonesia.

The Manulife Investor Sentiment Index (MISI) survey shows that Indonesia'€™s positive economic growth over the last few years played a role in putting the country in third position.

Indonesia also saw growing investor confidence in the housing, property, stock market and financial sectors in the first quarter of 2014. Positive economic reports by the media also contributed to investor confidence.

'€œThe increase in investors'€™ confidence in Indonesia is mostly due to [the country'€™s] recent economic performance,'€ Manulife'€™s director of business development, Putut Endro Andanawarih, said on Tuesday.

The survey measured Indonesia'€™s Investor Sentiment Index at 48, which is the third highest score in the Asia Pacific, behind Malaysia and the Philippines, both of which received a score of 58. The average regional score was 24. Elsewhere, Singapore scored 11 while Taiwan and Hong Kong both received negative scores, of minus 6 and minus 11, respectively. The United States, in comparison, scored 23.

According to Putut, economic factors in the first quarter that drove investors'€™ optimism included the appreciation of the rupiah by 6.66 percent to Rp 11,361, an 11.56 percent increase of the Indonesian Composite Index (IHSG), a lowered inflation rate from 8.08 percent in 2013 to the current 7.32 percent, and a decreased current account deficit from US$4.3 billion in the fourth quarter of 2013 to $4.2 billion in the first quarter of 2014.

Interest in investing in Indonesian shares and mutual funds also increased, according to the survey. However, Putut noted that the improving investor sentiment toward mutual funds and stocks in the quarter did not represent all investment decisions.

'€œInvestors still tend to deposit money in their savings accounts, meaning that they risk missing out on long-term gains. The public must make investment decisions as soon as they can, so that they can get the most out of it,'€ he said.

The survey also revealed that 72 percent of respondents tended to make investment decisions based on suggestions from friends and family, while 35 percent of respondents relied on media reports and 20 percent relied on industry staff.

Furthermore, one of the most prominent findings of the survey was that almost 75 percent of investors in Indonesia supported the idea to delay retirement age from the current age of 55 to 67.

MISI found that investors saw working at retirement age as positive and beneficial to their cognitive development and their financial situations, as well as enabling them to take advantage of a growing economy.

Indonesia'€™s retirement age is currently the lowest in the Asia-Pacific region.

Meanwhile, Putut mentioned that the results of the survey will be shown to the Financial Services Authority (OJK) in order to increase cooperation between the two institutions in the hope of luring more investors. (dyl)