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Indonesia’s shrinking middle class rattles businesses betting on a boom
People are falling behind as commodities sector fails to deliver well-paid jobs.
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Businesses selling everything from pizzas to cars have been hit by Indonesia’s shrinking middle class.
PHOTO: AFP
A. Anantha Lakshmi and Diana Mariska
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Pizza Hut’s Indonesian franchisee pinned its hopes on the expansion of the middle class in the world’s fourth-most populous country. But its decision to shut 20 stores and reduce its workforce offers a warning for those betting on a consumer boom in South-east Asia’s largest economy.
“We have observed shifts in consumer spending patterns in Indonesia, with a general trend of cautious spending among the middle class,” said Mr Boy Lukito, chief executive of Sarimelati Kencana, the franchise operator in Indonesia.
