Entrepreneurs, Multinational Enterprises and Policy
Edited by Maureen McKelvey and Sharmistha Bagchi-Sen
Chapter 11: The emergence of Indonesian multinational enterprises
This chapter examines innovation spaces developing in Indonesia, through multinational enterprises (MNEs). Hence, the purpose of this chapter is to examine the characteristics of a selected group of multinationals from Indonesia to understand how they have leveraged country-specific advantages to draw attention from the international business community to Southeast Asia. In recent years, the focus of research on emerging markets in Asia has been China and India. Indonesia, with a population size of over 240 million, ranks fourth in the world with less than 15 percent involved in agriculture, a gross domestic profit (GDP) growth rate of about 5.8 percent and a country where trade imbalance is not an issue. The potential size of the market is large with about 43 percent of the population below 25 years of age. Indonesia receives more foreign direct investment (FDI) than its outward FDI (OFDI). Although most of its major trading partners are in Asia, slightly over 6 percent of both exports and imports, respectively, is with the United States (CIA, 2013). The goal of this chapter is to study key characteristics of a selected group of Indonesian multinationals with a specific goal of identifying their innovative strategy pertaining to their emerging-market multinational status.
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