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Overview
Like all countries around the world, Indonesia has felt the effects of the economic downturn. However, in the wake of the global financial crisis, the Indonesian economy has performed surprisingly well, and is predicted to continue doing so for the duration of 2009. At the end of the first quarter of 2009, GDP grew by 4.4% year on year. Numerous factors have been credited with this surprising growth including the government’s Rp71.3tn stimulus package.
Late 2008/early 2009 saw the first sukuk issued by the government of Indonesia. The debut $650m bond issuance was well received by the market and was several times oversubscribed. Although a success, most predict that it will be some time before Sharia compliant Islamic finance is widespread.
Many of the firms ranked have seen changes in the volume and type of transactional instructions. Real estate work, especially that in the tourism sector, has slowed considerably. Domestic financing has also reduced or dried up completely. Unsurprisingly, restructuring and insolvency work picked up at the start of 2009. Projects, mining and energy continue to be a solid and strong area for firms operating within this market. Larger players report an increase in interest from other eastern countries including India, China, and closer to home, South Korea and Thailand.
The government issued a new mining law in mid-2009, although further amendments and clarifications are still expected.
Most lawyers in Indonesia are generalists, practising across numerous areas including banking, corporate and capital markets, or projects, energy and mining. Lateral moves are rare, with successful young partners more likely to start up their own firm than join a rival, as is the case with Bastaman Enrico – founded in mid-2009.