Marianne Kearney Jakarta – Malam Minggu or Saturday night is always busy in the glass and granite shopping centres that serve as Jakarta's social hubs.
But here in Senayan Plaza, one of the capital's plusher shopping centres, it has never been busier. Teenagers decked out in platform shoes, jogging shoes, jeans and T-shirts crowd around Wendy's ice-cream bar or line up for takeaways at fast-food joints. Young families munching on hamburgers, sushi and pizza crowd the food court, while slickly dressed young couples prowl the designer-label shops.
As the rupiah rides the rough waves created by the latest political fallout or reports of violence in the provinces, the only wave that the shops in Senayan Plaza are riding is the one on the up and up.
Bomb blasts, anti-Suharto demonstrations, as well as last month's political challenges to President Abdurrahman Wahid have not deterred the well-heeled from flocking to the centre's cinemas, shops and restaurants.
For sleekly dressed Christin Suparno, 34, shopping and meeting friends for lunch is at least a weekly event, regardless of the latest slump in the rupiah. "It doesn't make such a big difference. I come here regularly to shop because it has all the latest fashions," she said, showing off her latest purchase – a pair of black Georgio Armani pants, costing more than $1,700.
The centre is full of fashionably dressed young women and men, who if they do not splurge on exclusive designer labels, will at least buy fashionable but more casual labels.
But not all of those flocking to upmarket shopping centres come to shop. Many come to go to the movies or to eat at the food court and to window shop. Smaller shops and food outlets are also being boosted by hoards of teenagers and young people, who might not have much to spend but bring the crowds.
Such is the pulling power of the newer plazas such as Senayan, that some, such as student Siti Haryonto, 19, are prepared to pay more than twice the usual price of movie tickets to soak up the atmosphere, hang out with friends and, of course, watch a movie. Even if the students only spend 50 000 rupiah (S$10) each, this still contributes to the centres' success. Meanwhile, shoppers, such as Ms Suparno, with much deeper pockets, have helped designer stores to boost their sales by as much as 20 per cent since January.
At Senayan Plaza and Plaza Indonesia – another of Jakarta's posher shopping centres – several new designer-label stores have opened recently or are opening in the next few weeks. At Senayan, Fendi's recently installed bright orange, purple and lime green stilettos compete for attention with sleek black and grey outfits from the new Donna Karan New York store.
Luis Vuitton, Bvlgari, Georgio Armani and Christian Dior have already staked out prime space, yet foreign investors believe that Jakarta has yet to reach designer-label saturation point.
Ms Rosalyn Ruhardjo, a retail-property consultant from Jones Lang La Salle said both first-line and second-line brands, such as the more casual Hongkong or American labels, were still queueing for space in Jakarta. "The smart local business people knew there would be a turnaround once the new government came into power and so they got in early and bought up all the available retail space," she said.
The growth in luxury goods has been predicted for some time. As property managers point out, local businesses have been expecting the return of the upper classes once the election was over.
Analysts say the upper class has probably benefited from the early days of the downturn due to the high deposit interest rates being charged then. But though this class has always had the money to spend, it does not make up for it in confidence. This in turn makes the increased spending of the middle-and lower-middle-class consumers surprising.
Sales of items such as Body Shop soaps costing 40,000 rupiah are soaring. The Senayan store's manager, Mr Sugeng, said sales were up by 30 per cent and admitted to being pleasantly surprised by the sudden turnaround in business. "We expected it to improve but not by this much. The number of customers has doubled since January," he said.
Most of the shop's customers were career women (50 per cent) followed by teenagers (30 per cent) and housewives (20 per cent), he added. This again suggests that it is not just the affluent Gucci set but also those in the lower-middle classes who are freeing up their purse strings.
Meanwhile, the fast-food business is sizzling, with food outlets reporting twice as many customers as last year. "For food it doesn't matter, people have money for that," said Mr Hashim, the manager of a Japanese fast-food outlet. He said the rupiah would have to hit 12,000 to the US dollar – it is now 8,500 – before it would have an impact on the sales of the pricier items such as Japanese salmon.
Supermarkets catering not just to the upper class but also the lower-middle classes are also expecting a retail boom in the next year or so. Several large supermarkets such as the local Hero and Matahari, as well as the French chain Carrefour have also opened new stores.
Carrefour has opened three new hypermarkets since last year in anticipation of a retail turnaround. Its manager Agus Alwie is confident the sales volume will continue to rise over the coming year.
Parliament's tussle with President Abdurrahman in the past few months has had no effect on sales and Mr Agus is confident business will continue to expand as long as the government remains in power. Mr Agus said that, although Carrefour had opened seven stores, there was still room for growth in Jakarta.
With 30 to 40 per cent of Jakarta's 10 million-strong population qualifying as middle class, he thinks there is a big market yet to be tapped.
Although not all the Carrefour stores have increased their sales, sales in two stores – where many of the customers are lower-middle class or working class – have increased by 10 per cent this year. Much of the increased sales have been due to spending on non-essential items, such as electrical goods, he said.
Major local department stores such as Matahari and Ramayana, favourite haunts of the middle class as well as the upper range of the working class, are also showing huge jumps in their sales levels this year.
Matahari, which has department stores in major cities throughout Indonesia, is doing better in the first quarter compared with the whole of last year. Its first-quarter sales of 843.2 billion rupiah far outstrip those of last year's, which totalled 691.2 billion rupiah.
The growing spending power of Indonesian consumers – ranging from the upper class to the lower-middle class – is also supported by the country's healthy export figures. In the first quarter of this year, the total value of Indonesia's exports increased by US$4 billion, with strong performances by the manufacturing as well as the mineral and fuels sectors.
Mr Agus's confidence reflects a growing but guarded optimism among Indonesian business people. A recently-conducted survey by private research company Danareksa found that consumer confidence had increased in Jakarta and West Java, although it dropped in Sumatra, Sulawesi and the rest of Java.
Danareksa's survey, which includes people from all classes, showed that spending on durable goods had increased and more people were planning to renovate their homes – up from 4.9 per cent in July to 8.5 per cent last month.
And planned spending on new motorbikes, the ubiquitous family car for working-and lower-middle-class families, jumped from 2.2 per cent in March to 2.9 per cent last month.
Danareksa's chief researcher Raden Pardede said senior business leaders, while more subdued in their predictions for the next six months, were still more optimistic than they were six months ago.