Ika Krismantari, Jakarta – Forty five local firms have been surveyed on this year's business operations amid the continuing global downturn, and the result is hardly a surprise – more than half of them plan a cut in proposed capital spending.

While there are some companies that will boost capital expenditure sharply, overall company capital expenditure will go down by an average of 14.6 percent from a year earlier.

The survey by PT Mandiri Sekuritas released over the weekend shows that capital spending of 45 Indonesian firms in 14 sectors will fall to US$8.26 billion down from $9.6 billion in 2008.

This is a significant drop compared to the previous year, when capital expenditure of these companies surged 93 percent compared to 2007.

In the 2009 survey, the two specific companies surveyed in the construction sector were hardest hit by slowing economic growth, slashing capital expenditure by 94.8 percent to $27 million down from $524 million recorded in 2008.

In 2008, the capital expenditure of these same companies had surged 8,635 percent, as compared to 2007, showing huge volatility reflecting global economic conditions.

In contrast however, other companies operating in sectors heavily linked to construction such as toll roads, property development and building material firms showed an opposite trend, planning to spend even bigger this year.

Toll road firms will boost capital expenditure this year by a whopping 309 percent to $409 million, property firms by 217 percent to $318 million and and building material firms by 150 percent to $448 million.

Capital expenditure increases for these companies, according to the survey, reflects government plans to speed up infrastructure projects to stimulate economic growth to help cushion the impacts of the global economic slowdown.

Of the total Rp 73.3 trillion ($6.63 billion) in its stimulus economy package, the government will disburse Rp 12.2 trillion for infrastructure projects - in addition to more than Rp 90 trillion of similar projects already allocated in the 2009 state budget, in the hopes of stimulating the economy.

All in all, the Mandiri survey suggests no one can escape from the economic slowdown, with most local companies being conservative on business expandion in anticipation of continuing impacts from the global economic crisis.

Among these are the surveyed telecommunications firms, which will cut their budgets by 15 percent this year to $3.7 billion.

Plantation and energy companies, which enjoyed soaring commodity prices last year, are cutting capital expenditure by 30 percent and 25 percent respectively, to $159 million and $1.35 billion, respectively.

Other sectors where companies are cutting back include chemicals (85 percent) and heavy equipment (28.5 percent).

Meanwhile, companies focusing on consumer needs will slightly increase capital expenditure this year, by 4 percent, up to $325 million than in 2008. With its stimulus economic package, the government still targets the economy to grow at between 4 and 4.5 percent this year, lower than the 6.1 percent recorded in 2008.