Exploring new opportunities - Indonesia

Indofood wants to feed growing middle class

Indofood chief executive Anthoni Salim (third from right) with directors (from left) Mr Paulus Moleonoto, Mr Taufik Wiraatmadja, Mr Thomas Tjhie, Mr Franciscus Welirang and Mr Kevin Sietho. Indofood has been producing the popular Indomie noodles sinc
Indofood chief executive Anthoni Salim (third from right) with directors (from left) Mr Paulus Moleonoto, Mr Taufik Wiraatmadja, Mr Thomas Tjhie, Mr Franciscus Welirang and Mr Kevin Sietho.PHOTO: JAKARTA POST/ASIA NEWS NETWORK
Indofood chief executive Anthoni Salim (third from right) with directors (from left) Mr Paulus Moleonoto, Mr Taufik Wiraatmadja, Mr Thomas Tjhie, Mr Franciscus Welirang and Mr Kevin Sietho. Indofood has been producing the popular Indomie noodles sinc
Indofood has been producing the popular Indomie noodles since 1969.PHOTO: JAKARTA POST/ASIA NEWS NETWORK

Asean's surging middle class in a population of 628 million and optimism about economic prospects encourage enterprises to explore markets in neighbouring countries.

JAKARTA • Buoyant expectations are encouraging Indonesian food giant Indofood to think big.

Despite sluggish economic growth in the country, publicly listed food giant PT Indofood Sukses Makmur plans to increase production and the processing capacity of its various businesses.

The firm is now building more production lines for flexible packaging, milk, ice cream, instant noodle and flour, as well as greater processing capacity for palm oil, said Indofood head of investor relations Werianty Setiawan.

The expansion will be funded from the firm's allocated capital expenditure of 9.1 trillion rupiah (S$927.3 million) this year.

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The company will continue to push sales and export in the region, especially Cambodia, Laos and Vietnam, said Indofood director Franciscus Welirang.

The market potential in Asean is huge due to the emerging middle class, compared with developed countries outside the region.

"Indofood will export to new and emerging markets. We do sell in developed countries too, but we push more to the developing ones," he told reporters.

Indofood's exports contribute to more than 8 per cent of the company's revenue and it aims to increase the proportion to 9 to 10 per cent. Besides Asean, it has franchise operations in Africa and eastern Europe.

Indofood, which has been producing the popular Indomie noodles since 1969, started exporting in 1992. It is one of the largest consumer product companies in Asia and the biggest producer of instant ramen noodles in the world.

THE JAKARTA POST/ASIA NEWS NETWORK

A version of this article appeared in the print edition of The Straits Times on August 12, 2017, with the headline 'Indofood wants to feed growing middle class'. Print Edition | Subscribe