The Jakarta Post
Indonesia is experiencing a weakening consumer confidence in the third quarter but now fewer people think the economy is in recession, a recent survey shows.
According to Nielsen’s latest Global Consumer Confidence Survey, optimism among consumers in Southeast Asia’s largest economy went down three points from 126 percentage points (pp) in the second quarter to 123 in the third quarter.
Consumer confidence above the 100 pp baseline shows optimism while a confidence index below 100 shows pessimism.
Globally, Indonesia is still among the top five most optimistic countries despite stepping down a spot to fourth position this year, surpassed by Vietnam, whose index jumped 5 points from the second quarter.
Consumers of India are the most optimistic, followed by those of the Philippines and Vietnam. Meanwhile, Chinese trail Indonesians in fifth place, Nielsen's survey shows.
“In 2019’s third quarter, Indonesian consumers’ concern over political stability went down significantly. This is a relief and indicates that consumers have left behind all the hustle with the last presidential election,” Nielsen Indonesia managing director Agus Nurudin said in a press statement on Wednesday.
Only around 14 percent of the surveyed respondents expressed concern over the political stability aspect, lower that 26 percent in the second quarter.
The number of respondents who expressed optimism about their financial security and readiness to spend in the next 12 months decreased to 76 percent and 57 percent, respectively, compared to the previous quarter.
Despite the slight decline in the consumer confidence index (CCI), only 52 percent of respondents considered that the country was in an economic recession, compared to 57 percent in the second quarter.
However, the number of consumers concerned about health and global warming had gone up significantly by 8 and 5 percent to 16 and 17 percent, respectively.
“We observe that the increased concern over health has been strongly influenced by the news of the government’s plan to raise the BPJS premium,” Agus said. “While the long dry season along with continuous forest and land fires had made people even more concerned about the effect of global warming.”
The Nielsen survey was conducted in September, polling more than 32,000 online consumers in 64 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America.