Jakarta – It is time to spend money on lifestyle and long vacations, Indonesians say, amid a positive sentiment toward the economy and a declining fear of spending, a survey says.
Most Indonesian consumers believe the country's recent positive economic growth has created stability in the job market and a propensity for increasing salaries, the Nielsen Company says.
A survey by the company showed that approximately 70 percent of Indonesian consumers described their job prospects as excellent or good, which is above the 57 percent average rating for the Asia-Pacific region.
More than half of Indonesians said the country was no longer in an economic recession, a view shared by economists, the vast majority of whom believe the country has already emerged from the global economic crisis generally unscathed.
The World Bank predicted Indonesia's economy would grow 5.6 percent in 2010, 6.2 percent in 2011 and 6 percent in 2012.
"Indonesian consumers think that now is [the right] time to buy the things they want and need," Nielsen executive director on consumer research Catherine Eddy told reporters in Jakarta on Tuesday.
Eddy said Indonesian consumers were upbeat about their income in the next 12 months. Of all respondents surveyed, 46 percent said they would spend their disposable income on goods and 39 percent say they would spend it on vacations.
"Almost the all respondents said they had spare cash to spend, only 2 percent said they didn't," Eddy said.
The survey, conducted between March 8 and March 26, 2010, tracked consumer confidence, major concerns and spending intentions among 505 Internet users in Indonesia.
"It seems Indonesian consumers are gradually loosening their purse strings as we see increases in their intention to spend on what we might call 'indulgences'" Eddy said, adding that spending on technology products, such as mobile phones and other electronic gadgets, was likely to increase.
This kind of consumer perception was very positive, she said, but was also fragile.
"Should food prices suddenly go up, the situation could change dramatically and that would have a massive impact on confidence," she said.
As Indonesians now care more about indulging themselves in consumerism, there are fewer people making efforts to secure their future financial situations.
Only 28 percent of respondents surveyed in March said they would use their disposable income to pay off debt, which is lower than the 30 percent recorded in the previous six months.
There was also a slight decrease in those investing in shares or mutual funds. Approximately 43 percent of Indonesian respondents surveyed in March said they had investments in equity as opposed to 44 percent in the previous six months. On top of that, only 10 percent of Indonesians said they had invested in retirement funds. (not)