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Indonesia: Business Survey Quarter I 2018

IM Insights
By IM Insights
6 years ago
Indonesia: Business Survey Quarter I 2018

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  1. BUSINESS SURVEY Business Survey gf QUARTER I-2018  Respondents of the Bank Indonesia Business Survey reported stronger growth in the first quarter of 2018, with such developments confirmed by an increase in the corresponding weighted net balance (WNB) from 7.40% in the fourth quarter of 2017 to 8.23% in the reporting period. The agricultural, plantation, livestock, forestry and fisheries sector was the main driver of growth (WNB 2.40%), followed by the manufacturing industry (WNB 2.17%). Furthermore, an expansionary Bank Indonesia Business Survey Prompt Manufacturing Index (PMI-BIBS) also pointed to performance gains in the manufacturing industry .  Respondents confirmed that average production capacity utilisation increased on the previous period from an average of 75.05% to 76.27% in the first quarter of 2018. Consonant with ongoing business expansion, labour utilisation improved slightly in the first quarter of 2018, with the WNB contraction improving from -0.89% to -0.88%. The corporate sector maintained financial (liquidity and profitability) conditions in the first quarter of 2018 with easier access to credit also reported.  Respondents predicted the expansionary business trend to persist into the second quarter of 2018, reflected by a significant bump in the WNB to 17.99%. The optimism stemmed from increasing labour absorption and investment compared to the previous period. By sector, the Business Survey revealed that the manufacturing industry (WNB 3.50%) would benefit most from the seasonal spike in domestic demand during Ramad han and Eid-ul-Fitr 2018. In addition, respondents predicted expansive manufacturing industry growth to persist in the second quarter of 2018, as signalle d by further gains in the PMI-BIBS from 50.14% to 53.56% A. Business Activity Survey respondents reported stronger growth in the first quarter of 2018. Respondents of the Business Survey conducted by Bank Indonesia reported stronger growth in the first quarter of 2018. The weighted net balance (WNB) increase from 7.40% in the fourth quarter of 2017 to 8.23% in the reporting period (Graph 1). The agricultural, plantation, livestock, forestry and fisheries sector was the main driver of growth, indicated by a reversal in the WNB from -1.40% last period to 2.40%, on the back of the food crop subsector (WNB 2.20%). The majority of respondents (50.00%) acknowledged the recent harvests for Methodology The Business Survey has been conducted quarterly since the first quarter of 1993. In Quarter I-2018, the Survey was extended to 3,203 enterprises spread throughout all regions of the Indonesian archipelago, selected using purposive sampling. Statistically, the respondents have a sampling error of 2% at a 5% level of significance. Data is collated through respondent questionnaires either by hardcopy or by online on BI website. The data is calculated using the net balance method, namely by calculating the difference between the percentage of respondents whose answers increased, those whose answers decreased and those whose answers remained the same. In the case of calculating the net balance of business activity, selling price and labour utilization are calculated using the net weighted balance method. The weight reflected the contribution of each sector to GDP. Since Quarter I-2014, the Survey has been conducted in the last month of the current quarter (one month earlier than usual). In addition, the questionnaire improvement and integrated web-based application both were developed. Real Sector Statistics Division 1
  2. Business Survey stronger growth due to seasonal factors and weather conditions conducive to agricultural activity . Graph 1. Business Activity Respondents from the manufacturing industry also confirmed business expansion in the first quarter of 2018, overcoming a WNB of -0.12% in the fourth quarter of 2017 to record 2.17% in the reporting period. The wood and other wood products industry as well as the base metals (iron and steel) industry were reported as the main contributors to manufacturing industry growth, with the respective WNB increasing from 0.00% and 0.07% in the fourth quarter of 2017 to 1.19% and 1.03%. As many as 61.59% of respondents stated that business activity accelerated as a corollary of increasing domestic demand. Respondents predicted the upward trend to persist into the second quarter of 2018. Respondents predicted the expansionary business trend to persist into the second quarter of 2018, reflected by a significant bump in the WNB from 8.23% to 17.99%, affecting all sectors but predominantly the manufacturing industry (WNB 3.50%). By subsector, the survey revealed that the food, beverages and tobacco subsector (WNB 1.41%) as well as the textiles, leather and footwear industry (WNB 0.61%) would benefit most from the seasonal spike in domestic demand during Ramadan and Eid-ul-Fitr 2018. In addition to the manufacturing industry, respondents from the financial, real estate and corporate services sector (WNB 3.34%) as well as the trade, hotels and restaurants sector (WNB 3.13%) also predicted stronger business activity in the second quarter of 2018. In general, respondents expected the cyclical spike in demand during Ramadan and Eid-ul-Fitr to boost business activity in the second quarter of 2018 along with increasing market share. Real Sector Statistics Division 2
  3. Business Survey B . Production Capacity Respondents confirmed that average production capacity utilisation Average production capacity utilisation increased on the previous period. increased on the previous period. The Survey showed that in line with business expansion, average production capacity utilisation increased from 75.05% in the fourth quarter of 2017 to 76.27% in the first quarter of 2018 (Graph 2). By sector, respondents from the electricity, gas and water supply sector reported the highest level of production capacity utilisation, averaging 80.96%, contrasting the lowest reported in the mining and quarrying sector at an average of 73.71%. Graph 2. Capacity Utilisation C. Financial Conditions and Access to Credit The corporate sector maintained financial conditions in the first quarter of 2018 with easier access to credit also reported. In general, the corporate sector maintained financial conditions in the first quarter of 2018, reflected by a net balance (NB) of 34.67% for corporate liquidity, despite a moderate decline from 37.62% in the previous period. Most respondents (56.09%) acknowledged adequate liquidity conditions in the reporting period, while 39.29% stated that liquidity had improved and only 4.62% conceded that corporate liquidity had deteriorated on the previous period. In terms of profitability, the survey found that solid corporate profitability had been maintained despite a slight decline on the previous period, falling from a NB of 42.16% to 36.79%. Nevertheless, 54.09% of respondents acknowledged sound profitability in the reporting period, while 41.35%% stated that profitability had improved and only 4.56% conferred that corporate profitability had declined on the previous period. Real Sector Statistics Division 3
  4. Business Survey Regarding access to credit , the survey respondents reported easier access to bank loans in the first quarter of 2018, with the corresponding NB for the past 3 months nearly doubling from 4.30% to 8.45%. Consistent with maintained financial conditions in the corporate sector, most respondents (67.28%) confirmed that access to credit was normal, while 20.58% thought access to bank loans had improved and 12.14% argued that access was becoming more restricted compared to conditions 3 months earlier. D. Labour Utilisation Respondents utilised more labour in the first quarter of 2018. Consonant with ongoing business expansion, labour utilisation improved in the first quarter of 2018 with the WNB contraction improving from -0.89% to -0.88% (Graph 3). By sector, respondents confirmed that the agricultural and forestry sector, textile industry, fertiliser/chemicals industry as well as financial services and corporate services were the key drivers of increasing labour utilisation. Graph 3. Labour Utilisation Respondents predicted labour utilisation to continue ticking upwards in the second quarter of 2018. In the second quarter of 2018, respondents predicted labour utilisation to continue ticking upwards. Congruent with business expansion, respondents expected labour utilisation to increase in the second quarter of 2018 with a WNB of 5.29%. The survey found that most sectors were expecting to absorb more labour in the reporting period, especially the trade, hotels and restaurants sector (WNB 1.40%), followed by services sector (WNB 1.36%) as well as the financial, real estate and corporate services sector (WNB 1.31%) due to business expansion stimulating sales. Real Sector Statistics Division 4
  5. Business Survey E . Selling Prices Producers reported higher selling prices. Respondents acknowledged an accumulation of inflationary pressures in the first quarter of 2018, with the WNB of selling prices accelerating from 13.45% in the previous period to 15.91% (Graph 4). All sectors reported higher selling prices, particularly the agricultural, plantation, livestock, forestry and fisheries sector (WNB 4.28%), followed by the trade, hotels and restaurants sector (WNB 4.19%) and the manufacturing industry (WNB 4.16%). Respondents from those three sectors blamed rising production costs, especially raw materials and intermediate materials, for the upside pressures on selling prices. Graph 4. Selling Price Looking ahead, producers expected the inflationary pressures to persist into the second quarter of 2018 with a WNB of 17.65%, primarily affecting the manufacturing industry (WNB 4.83%) as well as the trade, hotels and restaurants sector (WNB 4.63). In general, respondents predicted inflationary pressures on raw materials and intermediate materials as well as labour costs to elevate selling prices in the second quarter of 2018. F. Inflation Respondents predicted inflation in 2018 at 3.44%. On average, respondents predicted inflation in 2018 at 3.44% (yoy), which lies within the target corridor for 2018 at 3.5±1%. By sector, respondents from the financial, real estate and corporate services sector expected the highest rate at 3.51%, contrasting the lowest rate predicted by respondents from the electricity, gas and water supply sector at 3.32%. Real Sector Statistics Division 5
  6. Business Survey G . Investasi Businesses were less inclined to invest in the first quarter of 2018. Corporate investment activity picked up on conditions one year earlier but growth slowed in comparison to dynamics in the previous period, reflecting a WNB of investment realisation recorded at 9.55%, up from 7.21% one year ago but down from 10.68% last period. By sector, respondents from several sectors reported slower investment growth in the first quarter of 2018, particularly the mining and quarrying sector as well as the financial, real estate and corporate services sector, with the WNB falling respectively from 1.75% and 2.32% in the fourth quarter of 2017 to 0.43% and 1.81%. In contrast, the manufacturing industry was more inclined to invest, indicated by an increase in the WNB from 2.40% to 2.70% in the reporting period. Respondents were upbeat, however, that corporate investment activity would rebound in the second quarter of 2018 as the WNB soared to 11.57%. By sector, respondents expected the investment gains to originate mainly from the manufacturing industry (WNB 2.91%), the financial, real estate and corporate services sector (WNB 2.67%) as well as the trade, hotels and restaurants sector (WNB 1.56%). H. Prompt Manufacturing Index (PMI-BIBS)* Prompt Manufacturing Index data pointed to first-quarter expansion in the manufacturing industry. The data pointed to performance gains in the manufacturing industry, as the PMI-BIBS moved from contractionary to expansionary territory in the first quarter of 2018, with the reading increasing from 48.75% to 50.14% (Graph 5). Such developments were commensurate with expanding business activity in the manufacturing industry, indicated by a reversal of the WNB from -0.12% last period to 2.17% in the first quarter of 2018. By component, production volume was the main driver of PMI-BIS gains in the reporting period at 52.71%, followed by new order volume (50.50%) and inventories (50.00%). *) Real Sector Statistics Division PMI-BIBS is a composite indicator providing an overview of manufacturing sector performance in Indonesia. PMI-BIBS is comprised of five other indices, namely new order volume (input), production volume (output), employment, supplier delivery times and inventories. PMI is calculated based on a pre-assessment of benchmarked Purchasing Manufacturing Indices from a number of other countries. An index reading of above 50 signals business expansion, while a reading of below 50 indicates a contraction. 6
  7. Business Survey Graph 5 . Prompt Manufacturing Index Respondents predicted expansive manufacturing industry growth to persist in the second quarter of 2018 as signalled by further gains in the PMI-BIBS to 53.56%. Such developments are also consistent with increasing business activity predicted in the manufacturing industry, indicated by an uptick in the WNB from 2.17% to 3.50% in the second quarter of 2018. By component, respondents predicted manufacturing industry expansion to stem from production volume (64.79%), coupled with labour (50.79%) and inventories (50.71%). Graph 6. Prompt Manufacturing Index Indicators Production Volume Index Real Sector Statistics Division Percentage Response in Q I-2018 7
  8. Business Survey Order Volume Index Inventory Index Supplier Delivery Time Index Labour Index Real Sector Statistics Division 8
  9. Business Survey I . Wages/Salaries Average wages/salaries have been observed to rise in the first semester of 2018. Average wages/salaries have been observed to rise in the first semester of 2018, with the net balance (NB) recorded at 45.60%, up from 18.25% in the latter half of 2017 but down slightly from 46.59% in the first semester of 2017. Respondents raised wages/salaries in compliance with the minimum wage policy set at the beginning of each year, while confirming that worker productivity and the business outlook also influenced wages/salaries. By sector, the trade, hotels and restaurants sector enjoyed the highest wage hike (NB 53.86%), followed by the manufacturing industry (NB 53.09%) as well as the financial, real estate and corporate services sector (NB 51.51%). Foreman/supervisor level salaries averaged Rp4.3 million per month in the first semester of 2018, with employees below that level taking home around Rp2.8 million per month. By sector, the highest wages/salaries were paid by the financial, real estate and corporate services sector, with remunerations averaging Rp5.6 million per month for foreman/supervisor level employees and Rp3.3 million per month for employees below that level. The latest survey also revealed that the majority (84.19%) of respondents were not planning to raise wages/salaries in the second half of 2018, compared to 15.81% that were. By sector, businesses in the trade, hotels and restaurants sector planned to raise wages/salaries the most (by an average of 9.17%), followed by those in the manufacturing industry (by an average of 8.88%). J. Profit Margin Respondents confirmed narrower profit margins. Respondents confirmed narrower profit margins in the first semester of 2018, declining from 19.28% in the second semester of 2017 or from 18.50% in the first semester of 2017 to 16.31% in the reporting period. Nevertheless, business margins remained above the minimum threshold of 10.91%, therefore production was not disrupted. By sector, businesses in the agricultural, plantation, livestock, forestry and fisheries sector maintained the widest business margin (averaging 19.08%), followed by the transportation and communications sector (averaging 17.43%) as well as the trade, hotels and restaurants sector (17.07%). Real Sector Statistics Division 9
  10. Business Survey SECTORAL REVIEW Agricultural , Plantation, Livestock, Forestry and Fisheries Sector Seasonal factors helped induce business activity in the agricultural, plantation, livestock, forestry and fisheries sector. Respondents confirmed that business activity increased in the agricultural, plantation, livestock, forestry and fisheries sector, overcoming a -1.40% WNB contraction in the fourth quarter of 2017 to post 2.40% in the first Graph 7. Business Activity of Agricultural, Plantation, Livestock, Forestry and Fisheries Sector quarter of 2018. The food crop subsector was the primary driver of the gains (WNB 2.20%). Most (50.00%) respondents mentioned bumper harvests as a result of weather conditions conducive to agricultural activities for the recent business expansion. Congruent with business expansion, the agricultural, plantation, livestock, forestry and fisheries sector also utilised more labour in the first quarter of 2018. Such dynamics were corroborated by an increase in the WNB from -0.16% last period to 0.81%. The food crop subsector was confirmed as the key driver of labour utilisation in the reporting period (WNB 0.50%). In terms of prices, respondents reported rising selling prices in the first quarter of 2018, as reflected in the WNB of 4.28%, up from 3.23% in the fourth quarter of 2017. Once again, the food crop subsector was the main contributor to higher selling prices, with the corresponding WNB increasing from 1.86% last period to 2.56% in the first quarter of 2018. Furthermore, the latest survey pointed to more expensive raw materials and intermediate materials as the principal driving force behind rising selling prices in the agricultural, plantation, livestock, forestry and fisheries sector. Respondents predicted business activity in the agricultural, plantation, livestock, forestry and fisheries sector to fade in the second quarter of 2018. Respondents predicted business activity in the agricultural, plantation, livestock, forestry and fisheries sector to slow in the second quarter of 2018, reflected in the WNB of 1.75%, down from 2.40% in the previous period. Respondents attributed the decline to the winding down of the harvesting season in the food crop subsector, with the corresponding WNB decreasing from 2.20% to 0.68%. In contrast, other subsectors of the agricultural, plantation, livestock, forestry and fisheries sector are predicted to accelerate in Real Sector Statistics Division 10
  11. Business Survey the second quarter of 2018 , induced by strong performances in the fisheries and plantation subsectors as a result of conducive weather for the upcoming harvesting seasons, with the respective WNB reversing the previous -0.15% and -0.07% contractions to post growth in positive territory at 0.27% and 0.33%. Respondents predicted lower labour utilisation in the agricultural, plantation, livestock, forestry and fisheries sector in the second quarter of 2018 in line with slower growth of business activity, evidenced by a moderate drop in the WNB from 0.81% in the first quarter of 2018 to 0.72%. Notwithstanding the decline, respondents in the plantation subsector expected to utilise more labour (WNB 0.35%). The survey also pointed to milder inflationary pressures on selling prices in the second quarter of 2018, with the WNB of selling prices falling from 4.28% to 3.85% in the reporting period. Most respondents (65.52%) conformed that a maintained supply of agricultural, plantation, livestock, forestry and fisheries products would ease pressures on selling prices. Mining and Quarrying Sector Respondents conceded slower business growth in the mining and quarrying sector during the first quarter of 2018. Respondents acknowledged a business decline in the mining and quarrying sector during the first Graph 8. Business Activity of quarter of 2018 compared to Mining and Quarrying Sector conditions in the previous period as a result of inclement weather, indicated by a -0.07% contraction in the WNB from positive 0.08% last period. Furthermore, businesses utilised less labour due to the declines in the mining and quarrying sector, with the corresponding WNB remaining in negative territory at -0.02%. Regarding prices, milder inflationary pressures were reported by respondents in the mining and quarrying sector, reflecting a drop in the WNB from 3.34% last period to 1.09% Respondents predicted an upswing in the mining and quarrying sector during the second quarter of 2018. Real Sector Statistics Division Respondents predicted an upswing in the mining and quarrying sector during the second quarter of 2018, with the WNB pushing back into positive territory at 0.01%. According to the latest survey, weather conditions conducive to mining activities, coupled with the availability of adequate production facilities, contributed to positive sector performance. Nonetheless, the expected performance gains will do little to increase labour utilisation in the second quarter of 2018, with the WNB contraction persisting at -0.30%. 11
  12. Business Survey Furthermore , respondents predicted milder inflationary pressures on selling prices in the sector, reflecting slower rising selling prices and a dip in the WNB from 1.09% to 0.81% in the reporting period. Manufacturing Industry Businesses in the manufacturing industry enjoyed stronger growth in the first quarter of 2018. Businesses in the manufacturing industry enjoyed stronger growth in the first quarter of 2018, indicated by a reversal in the WNB from a -0.12% contraction last period to positive 2.17% in the first quarter of 2018. The reversal was mainly attributed to the wood and other wood products subsector (WNB 1.19%) as well as the iron and basic steel industry (WNB 1.03%). Graph 9. Business Activity of Manufacturing Industry Nonetheless, the recent performance gains in the manufacturing industry have not increased labour utilisation, with the WNB contraction persisting at -1.73% and affecting most subsectors, especially the transportation, machinery and equipment industry (WNB -0.96%) as well as the food, beverages and tobacco industry (WNB -0.84%). Concerning prices, respondents confirmed a build-up of inflationary pressures on selling prices in the manufacturing industry, reflecting an increase in the WNB from 2.05% to 4.16%, edged up by rising prices of raw materials (confirmed by 72.87% of respondents) and higher labour costs (12.23% of respondents). Respondents from the manufacturing industry predicted the expansive growth trend to persist in the second quarter of 2018. Respondents from the manufacturing industry predicted the expansive growth trend to persist in the second quarter of 2018, indicated by further gains in the WNB from 2.17% to 3.50%. Respondents expected the food, beverages and tobacco industry (WNB 1.41%) as well as the textiles, leather and footwear industry (WNB 0.61%) to stimulate manufacturing industry growth in order to meet the seasonal spike in domestic demand during the holy fasting month and Eid-ul-Fitr 2018. In line with business expansion, firms operating in the manufacturing industry expected to utilise more labour in the second quarter of 2018, indicated by a significant improvement in the WNB from -1.73% in the first quarter of 2018 to 0.04%. On the other hand, respondents also anticipated an accumulation of inflationary pressures on selling prices in the manufacturing industry, with the WNB rising from 4.16% to 4.83% in the reporting period. By subsector, the food, beverages and tobacco industry (WNB 1.86%) as well Real Sector Statistics Division 12
  13. Business Survey as the transportation , machinery and equipment industry (WNB 0.96%) were predicted to be the main contributors to higher selling prices. Respondents cited rising production costs, primarily more expensive raw materials (confirmed by 66.27%) and higher labour costs (15.06%), for the increase predicted in selling prices. Electricity, Gas and Water Supply Sector Businesses in the electricity, gas and water supply sector experienced slower growth in the first quarter of 2018. Businesses in the electricity, gas and water supply sector experienced slower growth in the first quarter of 2018 on dwindling demand, reflecting a slight dip in the WNB from 0.30% to 0.26%. Graph 10. Business Activity of Electricity, Gas and Water Supply Sector As a result of slower growth, the utilities sector also utilised less labour in the first quarter of 2018, indicated by WNB moderation from 0.11% to 0.06% in the reporting period. Respondents also confirmed milder inflationary pressures on selling prices, with the WNB of selling prices decreasing from 0.22% to 0.15%. Businesses in the utilities sector predicted faster growth in the second quarter of 2018. Businesses in the utilities sector predicted faster growth in the second quarter of 2018 (WNB 0.28%) on the back of adequate production facilities and supporting production capacity against a backdrop of stronger domestic demand. Congruently, respondents also predicted labour utilisation to continue rising, albeit with slower gains compared to conditions in the previous month (WNB 0.05%). Furthermore, businesses in the utilities sector expected inflationary pressures on selling prices to intensify, with the WNB increasing from 0.15% to 0.17%. Construction Sector Business activity in the construction sector slumped in the first quarter of 2018. Real Sector Statistics Division Graph 11. Business Activity of Businesses were less Construction Sector active in the construction sector during the first quarter of 2018, reflected by a WNB contraction of -0.52, down from 0.03% in the previous period. Respondents attributed the business downturn in the construction sector to subdued construction project activity at the beginning of the year. Accordingly, labour utilisation was also confirmed 13
  14. Business Survey to decline , with the WNB deteriorating from 0.03% to -0.36% in the reporting period. Nevertheless, respondents in the construction sector acknowledged rising prices of construction services, evidenced by an increase in the WNB from 0.79% to 1.04%, bumped up by the cost of raw materials/intermediate materials and labour costs/wages, as confirmed by 75.34% and 16.44% of respondents respectively. Businesses in the construction sector anticipated performance to improve in the second quarter of 2018. Businesses in the construction sector anticipated performance to improve in the second quarter of 2018, with the WNB increasing to 1.02%, driven by increasing domestic demand for construction services (confirmed by 46.34% of respondents). Furthermore, as business activity accelerates in the upcoming period, construction businesses also expected to utilise more labour in the second quarter, overcoming the -0.36% contraction to post a WNB of labour utilisation at 0.41%. The rising cost of raw materials and labour stoked p the average price of construction services, with the WNB of selling prices in the construction sector increasing from 1.04% to 1.53% in the second quarter of 2018. Trade, Hotels and Restaurants Sector Respondents confirmed a contraction in the trade, hotels and restaurants sector. Respondents confirmed Graph 12. Business Activity of a first-quarter contraction in Trade, Hotels and Restaurants Sector the trade, hotels and restaurants sector, with the WNB sliding from 1.28% to -0.53%. All subsectors were affected by the contraction, particularly the wholesale and retail trade subsector, which recorded a decline in the WNB from 0.90% to -0.23% in the reporting period. Most respondents from the trade, hotels and restaurants sector stated that the contraction was in line with the end of the Christmas and New Year holiday season in the previous period. Congruently, the trade, hotels and restaurants sector also utilised less labour in the first quarter of 2018, indicated by a decrease in the WNB from 0.33% to -0.72%. Nonetheless, the respondents confirmed higher selling prices, with the corresponding WNB increasing from 3.26% to 4.19% in the reporting period, edged up by more expensive raw materials and intermediate materials as well as labour costs. Real Sector Statistics Division 14
  15. Business Survey Respondents predicted business activity in the trade , hotels and restaurants sector to pick up in the second quarter of 2018. Respondents predicted business activity in the trade, hotels and restaurants sector to pick up in the second quarter of 2018, reflecting a significant upswing in the WNB from -0.53% to 3.13%. Respondents expected all subsectors to post positive growth, led by the wholesale and retail sector (WNB 2.19%) on the back of the cyclical spike in domestic demand during Ramadan and Eid-ul-Fitr along with increasing market share. Consistent with business expansion, respondents in the trade, hotels and restaurants sector also expected to utilise more labour in the second quarter of 2018, evidenced by an upsurge in the WNB from -0.72% to 1.40%, with the wholesale and retail trade sector again dominating the gains (WNB 1.27%). Respondents predicted higher selling prices, indicated by the WNB increasing from 4.19% to 4.63%, again led by the wholesale and retail trade sector (WNB 4.07%). According to 39.18% of the respondents, raw material prices were the main driving force behind rising selling prices. Transportation and Communication Sector Respondents confirmed slower growth of the transportation and communication sector. Respondents confirmed slower growth of the transportation and communication sector in the first quarter of 2018, denoted by a drop in the WNB from 1.05% to 0.53%. Graph 13. Business Activity of Transportation & Communication Sector The transportation sector was the dominant contributor to the decline, with the WNB contracting -0.02% after posting positive 0.68% in the previous period. According to the respondents, slower growth was in line with fading seasonal factors after Christmas and New Year, which coincided with the school holidays at the end of 2017. Nevertheless, the slowdown had no impact on labour utilisation, with the WNB contraction persisting at -0.17%. The respondents opined that relatively limited adjustments to labour utilisation stemmed from efficient work processes. Furthermore, rising prices/fares slowed in the reporting period, indicated by a WNB of selling prices in the transportation and communication sector of 0.30%, down from 0.56% last period. Respondents from the transportation and communication sector expected conditions to improve in the second quarter of 2018. Real Sector Statistics Division Respondents from the transportation and communication sector expected conditions to improve in the second quarter of 2018, signalled by a notable increase in the WNB from 0.53% to 2.09%. The transportation subsector was predicted to catalyse the gains, with the WNB improving from -0.02% to 1.61%, driven by seasonal factors linked to Eid-ul-Fitr in June 2018. 15
  16. Business Survey Respondents expected to absorb more labour in the transportation and communication sector in line with the predicted sectoral growth and reflected by an increase in the WNB from -0 .17% to 0.37%. Furthermore, selling prices were also predicted to rise in the second quarter of 2018, with the WNB climbing from 0.30% to 0.92%. Financial, Real Estate and Corporate Services Sector Slower growth was acknowledged by respondents in the financial, real estate and corporate services sector. Slower growth was Graph 14. Business Activity of acknowledged by Financial, Real Estate and Corporate respondents in the financial, Services Sector real estate and corporate services sector in the first quarter of 2018, represented by a moderate dip in the WNB from 2.91% to 2.62%. The banking sector was cited as the main drag on financial, real estate and corporate services sector performance, with the corresponding WNB declining from 1.95% to 1.70% in line with the downward trend of banking and financial business activities compared to the previous period. Bucking the downward trend, however, the financial, real estate and corporate services sector utilised more labour in the reporting period, indicated by an increase in the WNB from 0.47% to 0.53%. Respondents also confirmed rising service fees and interest rates in the sector, with the WNB reversing the previous -0.53% contraction to post 0.13%. Most subsectors reported higher selling prices (service fees and interest rates), particularly the real estate subsector with the WNB rising from 0.21% to 0.50%. In general, the survey revealed that higher service fees and interest rates were induced by rising operating and acquisition costs at the beginning of the year. Respondents from the financial, real estate and corporate services sector predicted business growth to accelerate in the second quarter of 2018. Respondents from the financial, real estate and corporate services sector predicted business growth to accelerate in the second quarter of 2018, indicated by an increase in the WNB from 2.62% to 3.34%. According to 44.44% of respondents, growth will be driven by resilient domestic demand, thus maintaining market share. The banking sector was expected to lead the growth (WNB 1.76%), followed by corporate services (WNB 0.63%) and real estate (WNB 0.57%). Consistent with faster business growth, respondents also predicted greater labour absorption in the financial, real estate and corporate services sector in the second quarter of 2018, confirmed by an increase in the WNB Real Sector Statistics Division 16
  17. Business Survey from 0 .53% to 1.31%. Again, the banking sector was expected to dominate the gains (WNB 0.96%). The survey showed that 63.08% of respondents expected business expansion in the form of more branches and outlets to absorb the additional labour along with a greater variety of services on offer. In terms of prices, respondents predicted milder inflationary pressures on service fees and interest rates in the second quarter of 2018, indicated by a WNB of -0.09%, once again led by the banking sector (WNB -0.57%). The banks will be inclined to lower interest rates in line with the prevailing downward interest rate trend and backed by more efficient operating activities after sectoral consolidation. Services Sector Services sector growth moderated. Respondents were upbeat that services sector growth would accelerate in the second quarter of 2018. Real Sector Statistics Division Services sector growth Graph 15. Business Activity of moderated in the first quarter Services Sector of 2018, reflected by a decline in the WNB from 3.28% in the fourth quarter of 2017 to 1.39%. In line with positive business growth, however, respondents confirmed an increase of labour utilisation in the services sector, with a WNB of 0.73%. Furthermore, an increase in the WNB of selling prices from 0.53% to 0.56% pointed to higher service fees on average in the reporting period, which were raised to accommodate rising operating costs (as confirmed by 43.24% of respondents). Respondents were upbeat that services sector growth would accelerate in the second quarter of 2018, reflecting a bump in the WNB from 1.39% to 2.87%. In addition, respondents expected the services sector to utilise more labour in the upcoming period in line with business expansion, indicated by a WNB of 1.36%, up from 0.73% in the previous period. Meanwhile, respondents also anticipated higher service fees, with the WNB of selling prices increasing from 0.56% to 0.99%, elevated by rising operating costs. 17
  18. Business Survey APPENDIX Table 1 . Business Activity (Weighted Net Balance - WNB) 2015 2016 2017 2018 SECTOR I II III IV I IV I IV I 1.94 1.12 -0.17 -0.70 1.03 2.38 1.75 -4.07 1.98 1.57 0.40 -1.40 2.40 1.75 Farm Food Crops 1.74 0.56 -0.06 -0.17 0.86 1.21 0.87 -3.48 2.52 0.62 -0.04 -1.46 2.20 0.68 Non-food Crops 0.17 0.30 -0.15 -0.32 0.04 0.30 0.22 -0.15 -0.10 0.53 0.23 0.29 -0.07 0.33 Livestock & Products 0.03 0.11 0.14 -0.05 0.04 0.53 0.42 -0.06 -0.03 0.29 0.32 0.18 0.33 0.33 Forestry 0.00 0.00 0.00 -0.11 -0.09 0.26 0.41 0.00 0.00 -0.13 0.13 -0.07 0.08 0.13 Fishery Mining and quarrying 0.00 -1.12 0.15 -1.03 -0.09 -0.34 -0.05 -1.18 0.17 -1.30 0.08 1.69 -0.17 0.44 -0.38 -1.82 -0.41 -2.14 0.26 -1.63 -0.24 1.60 -0.34 0.08 -0.15 -0.07 0.27 0.01 Manufacturing Industry -0.72 1.91 -0.84 -0.34 -0.77 3.41 1.09 1.44 -0.58 3.81 1.76 -0.12 2.17 3.50 0.00 1.11 -0.25 0.11 -0.04 2.23 -0.15 0.17 -1.25 1.60 0.04 -0.45 0.04 1.41 Textile, leather products ang footwear -0.39 0.40 -0.22 0.00 0.02 0.87 0.00 0.07 -0.11 0.29 0.00 -0.18 0.08 0.61 Wood products & other wood products -0.17 -0.03 -0.03 0.08 -0.24 0.15 0.07 0.10 0.05 0.30 0.01 0.00 1.19 0.13 Paper and printing 0.21 0.05 -0.08 0.35 -0.28 0.46 0.09 0.18 0.16 0.42 0.48 0.05 0.07 0.38 Fertilizers, chemicals and rubber products 0.00 1.05 0.31 -0.25 -0.08 0.58 0.47 0.45 0.34 0.00 0.97 0.17 0.04 0.54 Cement and non metalic mineral products -0.32 -0.04 0.05 0.11 0.12 0.00 0.16 0.00 -0.17 0.16 0.00 0.06 -0.14 0.05 Iron and basic steel 0.00 0.00 0.00 0.02 -0.08 0.00 0.05 0.00 0.04 0.15 0.21 0.07 1.03 0.11 Transport equipment, machinery & apparatus 0.00 -0.64 -0.64 -0.78 -0.19 -0.91 0.38 0.47 0.37 0.88 0.00 0.16 -0.14 0.24 -0.04 0.03 0.03 0.01 0.00 0.03 0.02 0.00 -0.01 0.02 0.05 -0.01 -0.02 0.03 Electricity, Gas and Water Supply Construction 0.20 -0.16 0.26 0.37 0.19 0.22 0.19 0.22 0.17 0.59 0.24 0.20 0.25 0.90 0.28 0.88 0.38 -0.35 0.31 0.68 0.26 0.67 0.30 0.03 0.26 -0.52 0.28 1.02 Trade, Hotel and Restaurant -0.35 0.47 -0.54 0.10 -0.48 3.69 1.64 0.75 -0.99 4.32 1.94 1.28 -0.53 3.13 0.00 0.23 -0.84 -0.23 -0.03 2.93 1.21 0.33 -0.61 3.95 1.64 0.90 -0.23 2.19 -0.35 0.00 0.06 0.11 -0.14 0.21 0.17 0.09 -0.14 0.09 0.21 0.11 -0.10 0.23 0.00 0.23 0.24 0.22 -0.31 0.54 0.27 0.34 -0.24 0.27 0.08 0.27 -0.20 0.70 0.34 3.16 2.04 1.52 2.10 1.87 1.11 0.95 0.32 1.81 0.72 1.05 0.53 2.09 Transport 0.17 0.82 0.85 0.88 -0.20 1.13 0.49 0.52 -0.17 1.10 0.36 0.68 -0.02 1.61 Communication 0.17 2.34 1.19 0.63 2.30 0.74 0.62 0.43 0.49 0.71 0.36 0.36 0.55 0.48 2.53 2.92 1.93 2.10 1.77 2.58 2.45 2.47 2.31 3.11 3.18 2.91 2.62 3.34 Bank 2.10 2.23 1.80 1.83 1.39 2.00 1.77 1.47 2.19 2.17 2.15 1.95 1.70 1.76 Non bank financial institutions 0.24 0.25 0.02 0.05 0.21 0.13 0.17 0.13 0.17 0.28 0.13 0.21 0.08 0.35 Services allied to financial 0.01 0.02 0.01 0.01 0.02 0.02 0.01 0.02 0.03 0.03 0.03 0.02 0.02 0.03 Real Estate 0.00 0.00 0.00 0.10 -0.21 0.14 0.14 0.24 -0.33 0.15 0.40 0.29 0.43 0.57 Business services 0.08 0.42 0.10 0.11 0.36 0.29 0.36 0.61 0.25 0.48 0.48 0.45 0.39 0.63 2.18 2.72 2.57 1.10 2.69 2.34 3.58 2.26 3.87 3.38 3.78 3.28 1.39 2.87 4.83 11.91 5.06 3.02 5.80 18.40 13.20 3.13 4.80 17.36 14.32 7.40 8.23 17.99 Agriculture, Livestock, Forestry, & Fishery Food, beverages and tobacco Other manufacturing products Wholesale and retail trade Hotel Restaurant Transport & Communication Financial, real estate and business services Services TOTAL II III II III Note : * Expectation Real Sector Statistics Division 18 II*
  19. Business Survey Table 2 . Production Capacity Utilisation (Percentage) 2015 S E C T O R S 2016 2017 2018 I II III IV I II III IV I II III IV I 71.74 79.15 78.74 76.76 78.21 77.12 77.63 75.65 74.84 77.01 74.48 71.42 77.04 Farm Food Crops 80.77 83.60 82.24 77.74 82.39 82.94 79.48 79.48 76.81 81.66 77.00 71.25 81.04 Non-food Crops 73.26 78.60 77.73 75.06 75.12 74.27 73.09 73.09 78.51 77.41 74.10 69.55 80.13 Livestock & Products 79.27 86.74 82.76 80.34 86.81 82.29 80.11 76.50 72.41 73.97 76.75 77.28 77.28 Forestry 63.64 78.89 76.55 76.18 78.57 75.26 78.83 78.83 78.31 76.00 71.21 75.58 75.58 Fishery 61.75 69.68 67.93 77.41 74.44 72.68 74.50 72.82 68.16 69.56 70.85 78.03 76.63 77.08 70.37 73.06 71.08 74.52 76.02 75.04 73.34 73.73 63.41 74.25 71.15 73.71 74.33 75.89 68.46 70.47 71.23 70.33 73.15 74.59 74.02 75.65 74.53 73.37 73.39 75.54 77.35 73.80 76.64 75.92 77.43 75.30 76.58 75.15 76.84 74.13 73.64 73.48 Textile, Leather products and Footwear 77.38 80.68 76.61 78.15 78.51 79.84 75.50 79.81 78.30 78.68 78.66 76.65 77.27 Wood products & Other wood products 72.57 75.77 69.77 75.94 70.47 74.24 73.34 76.61 74.05 77.49 75.36 76.76 76.77 Paper and Printing 74.96 76.75 79.50 78.45 72.58 80.06 72.97 72.97 69.37 75.74 74.97 78.79 79.33 Fertilizers, Chemicals and Rubber products 74.74 78.63 78.59 76.35 73.32 72.83 77.81 77.81 75.84 74.30 75.63 75.59 75.72 Cement and Non metalic mineral products 76.16 80.41 85.39 87.29 75.21 77.50 77.11 69.90 73.26 73.17 73.50 70.06 70.06 Iron and Basic steel 66.88 72.60 64.29 69.29 64.59 65.53 62.55 69.43 68.87 73.79 75.16 69.51 69.92 Transport equipment, Machinery & Apparatus 73.72 64.26 71.26 68.42 65.52 68.78 68.42 71.55 76.04 74.00 69.67 65.90 65.07 Other manufacturing products 76.98 76.51 76.55 78.84 75.41 81.56 79.12 80.88 76.18 83.98 77.12 82.56 75.31 76.98 76.62 81.81 75.34 83.70 76.86 80.53 73.69 81.21 72.67 81.14 72.85 80.96 73.06 77.82 75.36 75.23 75.75 77.01 76.21 76.28 76.92 77.06 75.99 75.05 76.27 Agriculture, Livestock, Forestry, & Fishery Mining and quarrying Manufacturing Industry Food, Beverages and Tobacco Electricity, Gas and Water Supply TOTAL Table 3. Financial Condition and Access to Financing (Net Balance - NB) INDICATORS 2015 I II 2016 III IV I II 2017 III IV I II 2018 III IV I Financial condition over past three months: - Liquidity Better 26.08 38.22 26.64 34.60 39.34 40.89 38.94 40.89 41.19 41.75 41.70 41.71 39.29 Same 63.37 56.46 64.86 60.49 56.07 55.87 57.25 55.56 53.37 54.19 54.46 54.20 56.09 Worse 10.56 5.32 8.51 4.91 4.59 3.24 3.80 3.55 5.44 4.06 3.84 4.09 4.62 Net Balance (% Good - % Bad) 15.52 32.90 18.13 29.70 34.75 37.66 35.14 37.35 35.75 37.69 37.86 37.62 34.67 Better 24.51 36.34 24.99 34.11 36.74 41.96 40.19 40.65 42.86 44.11 44.32 45.25 41.35 Same 65.23 58.26 66.75 60.77 58.40 55.04 56.18 56.05 52.41 53.03 52.77 51.66 54.09 Worse 10.26 5.40 8.26 5.12 4.86 3.00 3.64 3.30 4.73 2.86 2.91 3.09 4.56 Net Balance (% Good - % Bad) 14.25 30.95 16.73 28.99 31.88 38.96 36.55 37.35 38.13 41.25 41.41 42.16 36.79 Easy 19.65 22.10 17.08 19.53 24.21 22.51 21.56 21.61 23.58 19.53 19.83 17.56 20.58 Normal 62.95 62.00 63.18 62.94 58.35 63.18 65.34 63.86 63.13 68.35 69.06 69.18 67.28 Tight 17.40 15.90 19.73 17.53 17.44 14.31 13.10 14.53 13.28 12.12 11.11 13.26 12.14 2.26 6.20 -2.65 2.00 6.77 8.20 8.45 7.07 10.30 7.41 8.72 4.30 8.45 - Rentability Access to credit over past three months: Net Balance (% Easy - % Tight) Real Sector Statistics Division 19
  20. Business Survey Table 4 . Labour Utilisation (Weighted Net Balance 2015 WNB) 2016 2017 2018 SECTOR I II III IV I 0.48 -0.34 -0.11 -0.22 0.90 Farm Food Crops 0.42 0.00 0.04 -0.37 Non-food Crops 0.03 -0.08 0.00 Livestock & Products 0.18 0.06 -0.11 -0.07 Agriculture, Livestock, Forestry, & Fishery Forestry Fishery II III IV I 0.48 -0.31 -0.67 0.06 -0.05 0.45 0.00 -0.08 -0.11 -0.12 -0.14 -0.13 0.07 0.10 0.19 -0.04 -0.23 0.11 0.53 0.00 II III IV I 0.09 -0.35 -0.16 0.81 II* 0.72 0.56 0.19 0.04 -0.09 0.50 0.34 -0.34 -0.24 -0.09 0.00 0.17 0.14 0.35 -0.07 -0.07 0.00 0.08 -0.05 0.08 0.08 0.05 -0.07 -0.14 -0.31 -0.13 -0.29 -0.20 0.17 -0.17 -0.04 -0.25 0.00 0.05 0.35 0.21 -0.04 -0.04 0.06 0.04 -0.04 -0.13 -0.07 0.15 Mining and quarrying -2.24 -1.33 -1.34 -1.24 0.25 -0.86 -1.12 -1.76 0.15 -0.13 0.91 -0.89 -0.02 -0.30 Manufacturing Industry -0.11 -0.99 -0.90 -1.86 -1.95 -0.02 -1.35 -0.94 -0.49 0.90 -0.87 -1.19 -1.73 -0.04 Food, beverages and tobacco -0.47 -0.02 -0.02 -0.08 -0.07 0.76 -0.41 0.00 -0.13 0.19 -0.59 -0.33 -0.84 0.15 Textile, leather products ang footwear -0.24 0.00 -0.71 -0.18 -0.52 -0.03 -0.29 -0.29 -0.32 0.04 -0.22 -0.18 0.04 0.00 Wood products & other wood products -0.14 -0.38 -0.18 -0.12 -0.15 -0.05 -0.23 -0.23 -0.09 -0.09 -0.09 -0.07 -0.04 0.03 Paper and printing -0.15 -0.08 0.08 -0.13 0.00 0.09 -0.23 -0.23 -0.16 0.14 0.06 -0.15 -0.14 -0.05 Fertilizers, chemicals and rubber products -0.45 -0.09 0.10 -0.24 -0.06 0.05 0.00 0.00 0.00 -0.04 0.09 0.30 0.22 0.13 Cement and non metalic mineral products -0.12 0.06 0.00 -0.04 0.04 -0.04 0.00 0.00 -0.02 0.05 -0.02 0.04 -0.02 0.00 Iron and basic steel -0.07 -0.40 -0.09 -0.02 -0.07 -0.05 0.00 0.00 0.04 0.07 0.11 -0.09 0.02 0.00 Transport equipment, machinery & apparatus -0.76 -0.06 -0.06 -1.04 -1.19 -0.73 -0.19 -0.19 0.18 0.53 -0.19 -0.71 -0.96 -0.32 0.00 -0.02 -0.02 -0.01 0.00 -0.02 0.00 0.00 0.00 0.02 0.00 -0.01 -0.01 0.01 Electricity, Gas and Water Supply Other manufacturing products -0.03 0.01 0.01 -0.03 -0.01 0.13 0.02 0.07 0.06 0.09 0.10 0.11 0.06 0.05 Construction -0.33 0.29 0.09 0.29 0.23 0.16 0.35 0.22 -0.42 0.00 0.09 0.03 -0.36 0.41 Trade, Hotel and Restaurant -0.96 -0.01 -0.57 0.00 -0.55 0.86 -0.65 0.08 -0.08 0.87 -0.76 0.33 -0.72 1.40 Wholesale and retail trade -0.52 0.00 -0.27 0.00 -0.48 0.81 -0.29 0.21 -0.08 0.95 -0.69 0.25 -0.43 1.27 Hotel -0.18 -0.10 -0.09 -0.04 -0.07 -0.05 -0.07 -0.02 -0.05 -0.08 -0.06 -0.01 -0.05 0.00 Restaurant -0.25 0.09 -0.21 0.04 0.00 0.10 -0.29 -0.11 0.06 0.00 0.00 0.08 -0.24 0.14 0.25 1.00 -0.26 0.11 0.33 0.04 0.18 0.22 0.03 0.16 -0.05 -0.12 -0.17 0.37 Transport 0.20 0.22 0.03 0.11 0.23 -0.05 0.11 0.27 0.09 0.12 -0.01 -0.06 0.02 0.46 Communication 0.05 0.78 -0.29 0.00 0.10 0.08 0.07 -0.05 -0.06 0.04 -0.05 -0.06 -0.20 -0.09 Transport & Communication Financial, real estate and business services 1.21 1.39 0.84 0.80 0.97 0.99 0.38 0.68 1.18 0.87 0.72 0.47 0.53 1.31 Bank 1.25 1.11 0.86 0.69 1.08 0.82 0.13 0.38 1.32 0.67 0.82 0.32 0.39 0.96 Non bank financial institutions 0.11 0.17 0.04 0.03 0.00 -0.03 -0.01 0.03 0.07 0.03 0.07 0.02 0.11 0.08 Services allied to financial 0.00 0.01 0.00 0.00 0.00 0.01 0.01 0.01 0.01 0.01 0.01 0.00 0.00 0.01 -0.19 -0.15 -0.19 0.00 -0.08 0.07 0.00 0.16 -0.16 0.08 -0.17 0.00 -0.07 0.07 0.04 0.24 0.13 0.07 -0.02 0.12 0.26 0.10 -0.06 0.08 0.00 0.12 0.10 0.20 -0.42 -2.15 0.70 0.73 0.49 -1.75 0.20 -1.94 1.77 1.94 0.54 2.32 0.64 -1.85 0.18 1.74 0.76 1.25 1.38 4.23 0.33 0.13 0.55 -0.89 0.73 -0.88 1.36 5.29 Real Estate Business services Services TOTAL Note : * Expectation Real Sector Statistics Division 20
  21. Business Survey Table 5 . Selling Price (Weighted Net Balance 2015 WNB) 2016 2017 2018 SECTOR I Agriculture, Livestock, Forestry, & Fishery II III IV I II III IV I II III IV I II* 4.50 4.97 5.46 4.41 2.19 2.95 2.63 2.61 1.26 0.66 2.25 3.23 4.28 3.85 Farm Food Crops 3.90 3.90 5.01 3.76 1.55 1.57 1.73 1.48 -0.05 0.00 1.04 1.86 2.56 2.10 Non-food Crops 0.02 0.03 -0.27 -0.16 0.02 0.52 0.07 0.25 0.51 0.38 0.52 0.31 0.41 0.48 Livestock & Products 0.09 0.77 0.56 0.61 0.14 0.33 0.35 0.24 -0.26 0.00 0.24 0.68 0.46 0.74 Forestry 0.23 0.28 -0.11 0.11 0.09 -0.07 0.14 0.27 0.00 0.20 -0.07 0.00 0.33 0.17 Fishery 0.26 0.00 0.28 0.09 0.39 0.59 0.34 0.37 1.06 0.09 0.52 0.39 0.52 0.37 -0.68 -1.57 -0.59 -0.37 0.54 1.59 1.26 2.51 -1.63 0.39 2.13 3.34 1.09 0.81 3.03 3.25 1.71 1.30 4.19 3.35 1.66 1.80 3.17 1.29 2.09 2.05 4.16 4.83 Food, beverages and tobacco 1.68 1.46 1.24 1.67 1.13 1.67 0.74 0.62 1.63 1.29 0.70 0.70 1.48 1.86 Textile, leather products ang footwear 0.42 0.47 0.67 0.18 0.62 0.20 0.29 0.07 0.46 0.44 0.37 0.07 0.54 0.54 Wood products & other wood products 0.20 0.27 0.08 0.13 0.18 0.28 0.16 0.24 0.09 0.24 0.14 0.22 0.15 0.23 Paper and printing 0.15 0.36 0.00 0.31 0.66 0.42 0.14 0.00 0.27 0.56 0.14 0.10 0.65 0.46 Fertilizers, chemicals and rubber products -0.33 0.28 -0.24 -0.81 0.39 0.58 0.41 0.73 0.98 -0.09 0.34 0.39 0.49 0.44 Cement and non metalic mineral products 0.17 0.00 0.02 0.11 0.07 0.00 0.08 -0.02 0.02 0.11 0.09 0.00 0.08 0.10 Iron and basic steel 0.09 -0.04 -0.08 -0.04 -0.05 0.02 0.02 -0.07 0.15 0.10 0.11 0.20 0.28 0.22 Transport equipment, machinery & apparatus 0.63 0.43 0.00 -0.26 1.19 0.18 -0.19 0.22 0.18 0.18 0.18 0.35 0.48 0.96 Other manufacturing products 0.00 0.02 0.02 0.01 0.02 0.01 0.01 0.01 0.04 0.02 0.02 0.02 0.02 0.01 Electricity, Gas and Water Supply 0.29 0.25 0.16 0.20 0.07 0.17 0.12 0.26 0.29 0.30 0.22 0.22 0.15 0.17 Construction 1.68 1.57 1.54 1.52 1.37 0.82 1.67 0.71 0.95 1.04 0.78 0.79 1.04 1.53 Trade, Hotel and Restaurant 4.83 5.14 5.29 4.62 4.20 3.42 3.17 2.71 4.71 2.97 2.83 3.26 4.19 4.63 4.35 4.64 4.90 4.28 3.51 2.98 2.80 2.35 4.37 2.70 2.57 2.94 3.80 4.07 -0.03 0.03 0.03 0.08 0.02 0.01 0.04 0.04 0.00 -0.01 0.07 0.03 0.01 0.09 0.50 0.47 0.36 0.26 0.67 0.42 0.33 0.32 0.33 0.27 0.20 0.28 0.38 0.46 0.94 1.03 0.87 0.69 0.30 0.59 0.50 0.44 0.49 0.78 0.34 0.56 0.30 0.92 Transport 0.79 0.87 0.58 0.42 0.13 0.45 0.40 0.36 0.26 0.63 0.28 0.37 0.23 0.75 Communication 0.15 0.15 0.29 0.28 0.17 0.14 0.10 0.08 0.23 0.16 0.06 0.18 0.07 0.18 1.29 1.09 0.82 0.97 0.08 -1.27 -0.48 -0.13 -0.04 0.17 0.04 -0.53 0.13 -0.09 Mining and quarrying Manufacturing Industry Wholesale and retail trade Hotel Restaurant Transport & Communication Financial, real estate and business services Bank 0.61 0.61 0.35 0.20 -0.43 -1.27 -0.95 -0.91 -0.68 -0.30 -0.46 -0.85 -0.70 -0.57 -0.01 0.03 0.11 0.04 0.03 -0.03 -0.02 0.00 -0.03 -0.02 -0.02 0.00 0.05 0.06 Services allied to financial 0.01 0.01 0.01 0.00 0.00 0.00 0.01 0.00 0.00 0.00 0.00 0.00 0.01 0.00 Real Estate 0.29 0.11 0.10 0.48 0.41 0.07 0.29 0.55 0.49 0.23 0.32 0.21 0.50 0.21 Business services 0.40 0.33 0.26 0.25 0.07 -0.04 0.19 0.22 0.17 0.26 0.21 0.10 0.27 0.20 1.15 1.57 1.45 0.65 1.53 1.19 1.37 0.43 0.82 0.78 1.34 0.53 0.56 0.99 17.04 17.30 16.72 14.00 14.48 12.81 0.00 11.90 0.00 11.35 10.03 9.92 0.00 12.03 0.00 13.45 15.91 17.65 0.00 Non bank financial institutions Services TOTAL Note : * Expectation Table 6. Annual Inflation Expectations (% of respondents) EXPECTATION FOR 2016 SECTOR EXPECTATION FOR 2018 EXPECTATION FOR 2017 Q1-2016 Survey Q2-2016 Survey Q3-2016 Survey Q4-2016 Survey Q1-2017 Survey Q2-2017 Survey Q3-2017 Survey Q4-2017 Survey Q1-2018 Survey Agriculture, livestock, forestry and fisheries 3.43 3.66 3.61 3.46 3.58 3.63 3.58 3.49 3.50 Mining and Quarrying 3.54 3.63 3.77 3.54 3.53 3.15 3.21 3.39 3.49 Manufacturing Industry 3.41 3.73 3.58 3.48 3.49 3.56 3.59 3.45 3.47 Utilities (electricity, gas and water) 3.61 3.42 3.53 3.23 3.50 3.54 2.29 3.60 3.32 Construction 3.65 3.47 3.65 3.47 3.60 3.46 3.67 3.30 3.33 Trade, hotels and restaurants 3.59 3.63 3.51 3.45 3.54 3.56 3.62 3.53 3.42 Transport and Communication 3.47 3.71 3.56 3.33 3.51 3.50 1.67 3.39 3.43 Financial, real estate and corporate services 3.71 3.64 3.64 3.60 3.69 3.63 3.47 3.60 3.51 Services 3.52 3.64 3.49 3.28 3.39 3.55 4.03 3.30 3.50 3.55 3.61 3.59 3.43 3.54 3.51 3.24 3.45 TOTAL Inflation Target Real Sector Statistics Division 4.0 ± 1 4.0 ± 1 3.44 3.5 ± 1 21
  22. Business Survey Table 7 . Realisation of Investment (Weighted Net Balance 2015 SECTOR WNB) 2016 I II III IV Agriculture, livestock, forestry and fisheries 2.03 0.93 1.25 Mining and Quarrying 1.34 0.94 0.71 Manufacturing Industry 1.69 0.56 Utilities (electricity, gas and water) 0.10 Construction 0.46 Trade, hotels and restaurants 2017 I II 1.26 0.99 1.58 0.51 0.23 -0.48 1.79 -0.02 0.16 -0.02 -0.64 1.00 0.22 0.18 0.13 0.12 0.49 0.47 0.49 0.03 1.01 1.80 0.94 1.33 Transport and Communication 0.79 0.81 0.77 Financial, real estate and corporate services 2.28 2.23 Services 1.23 1.61 TOTAL 10.93 9.60 III IV 2018 I II III IV I 1.08 0.67 1.15 0.82 0.85 1.47 0.06 -0.89 1.29 1.94 1.75 0.43 0.35 0.95 2.44 -0.21 1.36 1.31 2.44 2.70 2.91 0.22 0.21 0.20 0.29 0.29 0.24 0.25 0.17 0.21 0.46 0.83 0.54 0.58 0.49 0.32 0.32 0.22 0.61 1.08 1.83 1.42 1.76 1.82 1.88 1.30 1.43 1.11 1.56 1.04 0.69 0.78 0.77 0.92 1.15 0.71 0.74 0.60 0.45 0.72 1.45 2.61 2.24 1.83 1.90 2.24 1.82 2.28 2.02 2.32 1.81 2.67 0.79 1.38 2.07 1.34 1.34 1.64 1.99 1.13 1.97 0.73 1.18 1.05 7.21 10.58 10.66 10.68 9.55 11.57 6.71 8.44 6.10 10.82 7.92 10.88 Note : * Expectation Table 8. Prompt Manufacturing Index (Percentage) Component Period 2013 2014 2015 2016 2017 2018 PMI - BIBS Production Volume Order Volume Speed of Supplier Delivery Tme Inventory Labour I 50.18 45.41 45.76 48.23 46.64 47.18 II 59.86 50.10 48.51 50.80 50.10 52.37 III 51.12 49.23 47.41 48.97 47.07 48.97 IV 57.99 55.17 47.37 50.66 48.87 52.99 I 49.83 46.66 48.63 49.74 49.40 48.60 II 59.80 50.00 48.47 51.38 50.38 52.43 III 52.78 47.29 48.24 50.37 48.98 49.45 IV 53.25 45.93 47.20 49.73 48.73 48.89 I 41.89 45.08 45.12 49.87 46.04 44.96 II 60.03 44.96 47.75 50.39 47.91 50.28 III 46.32 45.94 46.32 49.34 46.10 46.46 IV 52.64 45.11 47.67 49.02 47.44 48.23 I 47.20 45.21 47.35 49.04 46.61 46.69 II 59.08 50.22 48.39 52.42 50.22 52.38 III 52.39 47.01 48.28 48.95 47.01 48.74 IV 55.12 51.04 48.64 48.08 48.56 50.91 I 47.70 48.17 48.31 49.16 48.62 47.93 51.68 II 57.53 48.23 49.41 50.74 51.70 III 54.78 49.79 49.07 48.64 48.29 50.51 IV 49.36 48.94 48.73 48.30 47.95 48.75 I 52.71 50.50 48.57 50.00 47.64 50.14 II* 64.79 49.50 48.57 50.71 50.79 53.56 Note : * Expectation Real Sector Statistics Division 22 II* 1.48
  23. Business Survey Table 9 . Wages / Salaries (Net Balance - NB) Semester I-2017 Semester II-2017 Semester I-2018 S E CT O R Increase Stable Decrease Net Balance Increase Stable Decrease Net Balance Increase Stable Decrease Net Balance Agriculture, livestock, forestry and fisheries 38.19 60.06 1.75 36.44 15.89 83.62 0.49 15.40 35.74 59.50 4.75 30.99 Mining and Quarrying 30.77 67.69 1.54 29.23 17.65 79.41 2.94 14.71 36.14 61.45 2.41 33.73 Manufacturing Industry 51.42 47.63 0.95 50.47 20.52 78.12 1.37 19.15 54.24 44.60 1.15 53.09 Utilities (electricity, gas and water) 35.37 63.41 1.22 34.15 13.13 85.86 1.01 12.12 39.39 57.58 3.03 36.36 Construction 41.38 55.17 3.45 37.93 14.29 84.66 1.06 13.23 38.67 60.44 0.89 37.78 Trade, hotels and restaurants 54.89 44.96 0.14 54.75 18.39 80.72 0.89 17.50 54.95 43.96 1.09 53.86 Transport and Communication 42.64 56.35 1.02 41.62 20.61 78.95 0.44 20.18 43.02 54.34 2.64 40.38 Financial, real estate and corporate services 51.83 47.25 0.92 50.92 29.67 68.86 1.47 28.21 52.17 47.16 0.67 51.51 Services 42.14 57.86 0.00 42.14 17.16 82.84 0.00 17.16 37.25 62.75 0.00 37.25 47.57 51.45 0.98 46.59 19.23 79.80 0.97 18.25 47.36 50.88 1.76 45.60 TOTAL Tabel 10. Business Plan on Wages/Salaries in Semester II-2018 (Percentage) Plan to Raise Wages/Salaries SECTOR Average Increase on Wages/Salaries Yes No Agriculture, livestock, forestry and fisheries 11.57 88.43 7.89 Mining and Quarrying 10.84 89.16 8.00 Manufacturing Industry 15.25 84.75 8.88 Utilities (electricity, gas and water) 11.11 88.89 5.11 Construction 16.89 83.11 7.67 Trade, hotels and restaurants 15.58 84.42 9.17 Transport and Communication 13.96 86.04 8.71 Financial, real estate and corporate services 25.08 74.92 8.30 Services 20.59 79.41 7.74 15.81 84.19 7.94 TOTAL Real Sector Statistics Division 23
  24. Business Survey Tabel 11 . Average Salaries/Wages (Rp) Semester I-2017 SECTOR Below Foreman /Supervisor Level Semester II-2017 Foreman /Supervisor Below Foreman /Supervisor Level Foreman /Supervisor Semester I-2018 Below Foreman /Supervisor Level Foreman /Supervisor Agriculture, livestock, forestry and fisheries 1,964,359 3,056,149 2,063,255 2,935,983 2,035,367 2,805,441 Mining and Quarrying 2,797,454 4,399,432 2,683,355 4,731,625 3,306,181 5,152,048 Manufacturing Industry 3,511,061 5,484,411 2,585,965 3,761,622 2,752,582 4,025,481 Utilities (electricity, gas and water) 3,145,877 5,009,069 3,305,301 5,176,768 2,947,363 4,716,677 Construction 2,464,363 3,519,086 2,571,656 3,832,548 2,507,087 3,640,420 Trade, hotels and restaurants 2,006,457 2,919,020 2,191,446 3,147,773 2,301,723 3,281,008 Transport and Communication 3,078,151 5,399,581 3,283,234 4,984,556 2,998,929 5,593,798 Financial, real estate and corporate services 3,006,291 5,105,238 2,978,143 5,265,977 3,349,808 5,627,667 Services 2,003,891 3,070,217 2,787,365 4,403,884 2,667,754 4,060,097 2,664,211 4,218,022 2,716,635 4,248,971 2,762,977 4,322,515 TOTAL Tabel 12. Profit Margin (Percentage) Semester I-2017 SECTOR Semester II-2017 Semester I-2018 Perkiraan Margin Usaha Margin Minimum yg Tidak Mengganggu Kegiatan Usaha Expected Margin Required Minimum Level Margin Expected Margin Required Minimum Level Margin Agriculture, livestock, forestry and fisheries 20.48% 14.24% 20.76% 13.29% 19.08% 11.95% Mining and Quarrying 17.26% 8.99% 19.10% 11.86% 15.62% 9.62% Manufacturing Industry 19.34% 13.13% 15.07% 11.54% 15.36% 10.62% Utilities (electricity, gas and water) 15.62% 11.56% 15.10% 12.41% 14.96% 11.29% Construction 15.90% 9.77% 19.27% 12.81% 16.21% 11.13% Trade, hotels and restaurants 19.86% 12.93% 20.45% 14.01% 17.07% 12.10% Transport and Communication 23.51% 14.03% 20.92% 13.16% 17.43% 11.06% Financial, real estate and corporate services 16.72% 10.02% 16.98% 11.42% 15.17% 9.80% Services 17.83% 10.11% 20.36% 11.17% 15.85% 10.62% 18.50% 11.64% 19.28% 12.73% 16.31% 10.91% TOTAL Real Sector Statistics Division 24