Jakarta, CNBC Indonesia – The domestic stock market is considered to be on the rise again starting this year and will continue to grow next year. This increase occurred after investors withdrew their funds massively from last year until the beginning of this year due to doubts over the state of the pandemic in the country.
Even PT Schroder Investment Management Indonesia (Schroders) predicts that one sector that will become an investment attraction is the nickel mining sector.
President Director of Schroders Michael Tjandra Tjoa said Indonesia was now in a better position. Even Indonesia can prove that the current handling of Covid-19 is better.
“People see that we should start investing in Indonesian, why? We know that Covid-19 is the fundamental problem for the 2020 world economic decline, because we know that economic growth is falling, there are restrictions lockdown and make economic growth not reach the expected point,” said Michael at the Indonesia Knowledge Forum (IKF) X – 2021, Thursday (7/10/2021)
“And Indonesia has proven itself that this problem, yes, occurs and even we have reached the level that we feared before and then we can improve significantly,” he continued.
In addition, said Michael, currently the investment potential is even greater because of the existence of new economy in terms of nickel commodities. Considering that Indonesia is one of the nickel producing countries in the world.
Nickel will be eyed by investors as future energy along with the development of investments that prioritize Environmental, Social and Corporate Governance (ESG).
The existence of this commodity is considered to be an attraction, not only for direct investment but also for the financial market in Indonesia.
“This largest nickel producer will be seen, chosen by investors because it is the future energy because we enter ESG, so the need for nickel in the future is very much needed in the world. So we will see that all direct investment will enter Indonesia, enter this sector This will be an interesting thing for the market in Indonesia,” he said.
In addition to these factors, Michael said that investors are now looking back at Indonesia because they are optimistic that the economy has started to move again after the handling of Covid-19 which is considered to be improving.
This is evidenced by the start of stretching many companies that grow expectations of growth in company performance. Also supported by the start of credit growth, automotive sales to purchasing power.
“This is optimistic that investors will start investing in public companies in Indonesia,” he added.
Nevertheless, there is a risk of rising interest rates to inflation. But this increase is in line with economic movements.
“But we know that inflation rises due to increased purchasing power, due to rising economic growth and if that happens we don’t have to worry about inflation. Because we know the economy is growing,” he explained.
“Indonesia is in much better positioning now compared to some time ago when the tapering took place.”
He explained that the current position of foreign exchange reserves of US $ 146 billion, this is the highest number, coupled with the trade balance which is in a better position than before the Covid-19 pandemic.
“We also see that our interest rate still provides prospects compared to other countries,” he explained.
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