Daily Archives: January 27, 2020

Altus Group Report Reveals CRE Industry on Verge of Significant PropTech Consolidation as Technology Adoption Reaches Tipping Point

Data usability challenges continue to hinder productivity while a majority of CRE leaders believe automation will impact jobs and transform the workforce

TORONTO, Jan. 27, 2020 (GLOBE NEWSWIRE) — Altus Group Limited (“Altus Group”) (TSX: AIF), a leading provider of software, data solutions and independent advisory services to the global commercial real estate (“CRE”) industry, today released its latest annual Altus Group CRE Innovation Report that provides an outlook on technology trends and highlights the current digital transformation impacting the global CRE industry.

According to the report, which is based on a global survey of 400 CRE executives, the industry has reached a tipping point as PropTech adoption hits a critical mass threshold.  For the first time in five years since Altus Group began conducting this annual research, a majority of CRE leaders now fully recognize the disruptive impact of PropTech, illustrating the shift to an acknowledgement that many advanced technologies can potentially solve their current challenges.

“CRE continues to rapidly accelerate its digital transformation and despite the growing complexity stemming from the proliferation of data, the industry is clearly shifting from a stage of ‘trial and testing’ to one of practical innovation to solve their current challenges today,” said Bob Courteau, Chief Executive Officer, Altus Group. “At the same time, continued automation and significant PropTech consolidation will both have a major impact and deliver considerable opportunities for the industry.”

Platforms and Automation – Transformational and in Full Force
The report finds that online marketplace platforms are gaining significant traction with 61% of CRE leaders saying they will have a major disruptive impact on the industry. Recent years have seen new platform-based marketplaces connecting a broad network of market participants (such as buyers and sellers, tenants and landlords, lenders and borrowers, and investors and fund managers), and delivering transactional efficiencies as well as the collection and aggregation of data for the benefit of users. Lending platforms have experienced the largest level of adoption to date with 63% of CRE firms having used an online lending marketplace for a recent transaction and 79% planning to increase use in the future.

A significant majority of CRE executives (75%) say automation will eliminate jobs. This was counter-balanced with the view that automation also presents an opportunity to introduce new types of jobs within the industry (71%) and shift jobs towards higher value-add tasks (67%). While CRE leaders recognize both the impact on jobs and the short-term productivity benefits that automation can deliver, a major challenge is to anticipate how it shapes the future of the CRE workforce.

Data Complexity Growing but Making Progress through Increased Executive Oversight
Data usability challenges continue to intensify as a result of fragmented data sources, data duplication and heightened complexity of overall data management. CRE executives report increased challenges in a majority of key areas related to data management when compared to five years ago:

Impediments to firms collecting or utilizing more data to drive decision-making 2015 2020
Issues around the regulatory requirements of collection and management of data 47% 59%
Lack of internal expertise/capability 29% 52%
Lack of normalized data formats 40% 48%
Lack of appetite from the company to invest in the required technology 36% 43%
Issues around veracity or accuracy of data 52% 40%
Lack of tools to assist with data capture & analysis 44% 37%
No impediments to collecting or utilizing more data to drive decision-making 18% 3%

The industry is heavily relying on data to drive decision-making but is hindered by disparate data requiring greater amounts of time to manage. Conversely, there exists a growing prioritization by CRE firms to address these challenges through dedicated executive ownership and governance related to overall data strategy.

  • Almost half (45%) of CRE teams are spending at least 15% to over 25% of their time managing and organizing data (equivalent to two to three months of the year).
  • Eight out of 10 CRE firms now have a Chief Data Officer or equivalent senior executive who oversees their organization’s data strategy and data governance. This compares to Altus Group’s 2016 research where 44% of firms surveyed indicated a lack of executive sponsorship.

PropTech Consolidation is Coming
While the PropTech landscape has exploded with a huge proliferation of new, enhanced and competing technologies, CRE executives now believe the timeframe for these technologies to start gaining traction and deliver results starts now, with PropTech consolidation a necessary outcome.

  • 89% of CRE executives said significant consolidation is needed for PropTech to more effectively deliver on the needs of the CRE industry, with 43% saying it is already underway or will occur within 12 months.
  • Areas of PropTech most likely to experience consolidation include property management, property transactions and listing services, and financing and lending firms.

Other notable findings from this year’s Altus Group CRE Innovation Report include:

  • A large majority of CRE executives (87%) believe global data standards for commercial real estate will eventually be adopted, however, numerous obstacles were identified including a lack of standardized data definitions on a global scale, and privacy and data protection regulations.
  • 50% of executives believe 5G wireless technology will create major disruptive impact on the CRE industry with 81% saying it will support increased adoption and use related to smart city development.

The 2020 Altus Group CRE Innovation Report is based on a global quantitative survey of 400 CRE C-level and senior executives in both front and back office positions at owner operator and investor firms in North America, Europe, Asia-Pacific and Latin America. All firms represented in the survey had a minimum of assets under management of at least US $250 million at the time of being surveyed, representing an approximate total AUM of over US $2 trillion. The survey research, used to form the basis of the report, was conducted by leading international research firm IDC in late fall 2019. A copy of the full report can be downloaded at https://www.altusgroup.com/argus/resources/insights/cre-innovation-report-2020/.

About Altus Group Limited

Altus Group Limited is a leading provider of software, data solutions and independent advisory services to the global commercial real estate industry. Our businesses, Altus Analytics and Altus Expert Services, reflect decades of experience, a range of expertise, and technology-enabled capabilities. Our solutions empower clients to analyze, gain insight and recognize value on their real estate investments. Headquartered in Canada, we have approximately 2,500 employees around the world, with operations in North America, Europe and Asia Pacific. Our clients include some of the world’s largest commercial real estate industry participants. Altus Group pays a quarterly dividend of $0.15 per share and our shares are traded on the TSX under the symbol AIF.

For more information on Altus Group, please visit: www.altusgroup.com.

FOR FURTHER INFORMATION PLEASE CONTACT:

Altus Group Limited
Jeff Hayward
Vice President, Global Marketing & Communications
416-234-4212
jeff.hayward@altusgroup.com

Media Contacts
Proof Inc.
Jillian Colucci
416-969-2785
jcolucci@getproof.com

FTI Consulting
Phil Kennedy
+44 (0)20 3727 1286
altus@fticonsulting.com

Altus Group Report Reveals CRE Industry on Verge of Significant PropTech Consolidation as Technology Adoption Reaches Tipping Point

Data usability challenges continue to hinder productivity while a majority of CRE leaders believe automation will impact jobs and transform the workforce

TORONTO, Jan. 27, 2020 (GLOBE NEWSWIRE) — Altus Group Limited (“Altus Group”) (TSX: AIF), a leading provider of software, data solutions and independent advisory services to the global commercial real estate (“CRE”) industry, today released its latest annual Altus Group CRE Innovation Report that provides an outlook on technology trends and highlights the current digital transformation impacting the global CRE industry.

According to the report, which is based on a global survey of 400 CRE executives, the industry has reached a tipping point as PropTech adoption hits a critical mass threshold.  For the first time in five years since Altus Group began conducting this annual research, a majority of CRE leaders now fully recognize the disruptive impact of PropTech, illustrating the shift to an acknowledgement that many advanced technologies can potentially solve their current challenges.

“CRE continues to rapidly accelerate its digital transformation and despite the growing complexity stemming from the proliferation of data, the industry is clearly shifting from a stage of ‘trial and testing’ to one of practical innovation to solve their current challenges today,” said Bob Courteau, Chief Executive Officer, Altus Group. “At the same time, continued automation and significant PropTech consolidation will both have a major impact and deliver considerable opportunities for the industry.”

Platforms and Automation – Transformational and in Full Force
The report finds that online marketplace platforms are gaining significant traction with 61% of CRE leaders saying they will have a major disruptive impact on the industry. Recent years have seen new platform-based marketplaces connecting a broad network of market participants (such as buyers and sellers, tenants and landlords, lenders and borrowers, and investors and fund managers), and delivering transactional efficiencies as well as the collection and aggregation of data for the benefit of users. Lending platforms have experienced the largest level of adoption to date with 63% of CRE firms having used an online lending marketplace for a recent transaction and 79% planning to increase use in the future.

A significant majority of CRE executives (75%) say automation will eliminate jobs. This was counter-balanced with the view that automation also presents an opportunity to introduce new types of jobs within the industry (71%) and shift jobs towards higher value-add tasks (67%). While CRE leaders recognize both the impact on jobs and the short-term productivity benefits that automation can deliver, a major challenge is to anticipate how it shapes the future of the CRE workforce.

Data Complexity Growing but Making Progress through Increased Executive Oversight
Data usability challenges continue to intensify as a result of fragmented data sources, data duplication and heightened complexity of overall data management. CRE executives report increased challenges in a majority of key areas related to data management when compared to five years ago:

Impediments to firms collecting or utilizing more data to drive decision-making 2015 2020
Issues around the regulatory requirements of collection and management of data 47% 59%
Lack of internal expertise/capability 29% 52%
Lack of normalized data formats 40% 48%
Lack of appetite from the company to invest in the required technology 36% 43%
Issues around veracity or accuracy of data 52% 40%
Lack of tools to assist with data capture & analysis 44% 37%
No impediments to collecting or utilizing more data to drive decision-making 18% 3%

The industry is heavily relying on data to drive decision-making but is hindered by disparate data requiring greater amounts of time to manage. Conversely, there exists a growing prioritization by CRE firms to address these challenges through dedicated executive ownership and governance related to overall data strategy.

  • Almost half (45%) of CRE teams are spending at least 15% to over 25% of their time managing and organizing data (equivalent to two to three months of the year).
  • Eight out of 10 CRE firms now have a Chief Data Officer or equivalent senior executive who oversees their organization’s data strategy and data governance. This compares to Altus Group’s 2016 research where 44% of firms surveyed indicated a lack of executive sponsorship.

PropTech Consolidation is Coming
While the PropTech landscape has exploded with a huge proliferation of new, enhanced and competing technologies, CRE executives now believe the timeframe for these technologies to start gaining traction and deliver results starts now, with PropTech consolidation a necessary outcome.

  • 89% of CRE executives said significant consolidation is needed for PropTech to more effectively deliver on the needs of the CRE industry, with 43% saying it is already underway or will occur within 12 months.
  • Areas of PropTech most likely to experience consolidation include property management, property transactions and listing services, and financing and lending firms.

Other notable findings from this year’s Altus Group CRE Innovation Report include:

  • A large majority of CRE executives (87%) believe global data standards for commercial real estate will eventually be adopted, however, numerous obstacles were identified including a lack of standardized data definitions on a global scale, and privacy and data protection regulations.
  • 50% of executives believe 5G wireless technology will create major disruptive impact on the CRE industry with 81% saying it will support increased adoption and use related to smart city development.

The 2020 Altus Group CRE Innovation Report is based on a global quantitative survey of 400 CRE C-level and senior executives in both front and back office positions at owner operator and investor firms in North America, Europe, Asia-Pacific and Latin America. All firms represented in the survey had a minimum of assets under management of at least US $250 million at the time of being surveyed, representing an approximate total AUM of over US $2 trillion. The survey research, used to form the basis of the report, was conducted by leading international research firm IDC in late fall 2019. A copy of the full report can be downloaded at https://www.altusgroup.com/argus/resources/insights/cre-innovation-report-2020/.

About Altus Group Limited

Altus Group Limited is a leading provider of software, data solutions and independent advisory services to the global commercial real estate industry. Our businesses, Altus Analytics and Altus Expert Services, reflect decades of experience, a range of expertise, and technology-enabled capabilities. Our solutions empower clients to analyze, gain insight and recognize value on their real estate investments. Headquartered in Canada, we have approximately 2,500 employees around the world, with operations in North America, Europe and Asia Pacific. Our clients include some of the world’s largest commercial real estate industry participants. Altus Group pays a quarterly dividend of $0.15 per share and our shares are traded on the TSX under the symbol AIF.

For more information on Altus Group, please visit: www.altusgroup.com.

FOR FURTHER INFORMATION PLEASE CONTACT:

Altus Group Limited
Jeff Hayward
Vice President, Global Marketing & Communications
416-234-4212
jeff.hayward@altusgroup.com

Media Contacts
Proof Inc.
Jillian Colucci
416-969-2785
jcolucci@getproof.com

FTI Consulting
Phil Kennedy
+44 (0)20 3727 1286
altus@fticonsulting.com

Helsinn Group Grants Exclusive Licensing Rights to Berlin-Chemie AG, a company of the Menarini Group, for ONICIT®/ALOXI® and AKYNZEO® in Russia and CIS region

Helsinn Group Grants Exclusive Licensing Rights to Berlin-Chemie AG, a company of the Menarini Group, for ONICIT®/ALOXI® and AKYNZEO® in Russia and CIS region

  • Berlin-Chemie AG has been granted exclusive rights to import, distribute, promote, market and sell AKYNZEO® and ONICIT® (ALOXI®) in Russia and CIS region from January 2020
  • The two products will provide clinicians and patients with a comprehensive offering to manage chemotherapy-induced nausea and vomiting

Lugano, Switzerland and Berlin, Germany, January 27, 2020: Helsinn Group (“Helsinn”), a Swiss pharmaceutical group focused on building quality cancer care products, has granted exclusive licensing rights to commercialize AKYNZEO® and ONICIT® (ALOXI®) in Russia and the CIS region for the prevention of chemotherapy-induced nausea and vomiting (CINV) to Berlin-Chemie AG (“Berlin-Chemie”), the German-based affiliate of the Menarini Group.

AKYNZEO®, a fixed dose combination anti-emetic therapy targeting both critical pathways of acute and delayed CINV, was granted registration in Russia in October 2019 and the product will be launched in the country in 2020.

ONICIT®, an anti-emetic for the prevention of CINV, was registered in Russia in 2011 and will be relaunched with AKYNZEO®.

Besides Russia, the licensing agreements with Berlin-Chemie cover the following territories: Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, Ukraine and Uzbekistan. AKYNZEO® has obtained a registration in Ukraine and Kazakhstan while ALOXI® holds a registration in Ukraine.

Under the terms of the agreements, Helsinn will retain all international development rights, including clinical development activities, and the supply of AKYNZEO® and ONICIT/®ALOXI®. Berlin-Chemie will have the exclusive rights to promote, distribute and commercialize AKYNZEO® and ONICIT®/ALOXI® in all countries of the assigned territories.

Riccardo Braglia, Helsinn Group Vice Chairman and CEO commented: “We’re delighted to have signed these agreements with Berlin-Chemie, which has established a strong presence and recognition in Russia and the CIS region. We look forward to being able to offer cancer patients greater choice for treating CINV, which remains a major issue during chemotherapy.”

“This is an important step for cancer patients across Russia and the CIS region. We look forward to working closely with Helsinn as we seek to launch AKYNZEO® and re-launch ONICIT® in the year ahead. We have been impressed by Helsinn’s commitment to the highest quality cancer care products and are pleased to extend our partnership with them.” said Michael Sirotovitch, COO of Berlin-Chemie AG.

ENDS

About AKYNZEO® (netupitant/palonosetron)

In the EU:

AKYNZEO® (netupitant 300mg/palonosetron 0.5mg) capsules for oral use was approved in May 2015 in the EU. Akynzeo oral is indicated in the EU for adults for the prevention of acute and delayed nausea and vomiting associated with highly emetogenic cisplatin-based cancer chemotherapy and moderately emetogenic cancer chemotherapy.

For additional information please see the EU Summary of Product Characteristics

Oral netupitant combined with oral palonosetron (NEPA) has been recommended by various international antiemetic guidelines: the National Comprehensive Cancer Network (NCCN) antiemetic guidelines, both in Highly Emetogenic Chemotherapy (HEC; inclusive of AC and carboplatin AUC≥4) and in Moderately Emetogenic Chemotherapy (MEC) for selected patients with additional risk factors or who have failed previous cycles of CINV prevention with steroid plus setron; the American Society for Clinical Oncology (ASCO) guidelines, in HEC, including AC, and carboplatin (AUC≥4) regimens and the MASCC/ESMO Guidelines in HEC, AC and carboplatin-based chemotherapy. Helsinn currently has 20 licensing partners for AKYNZEO® in over 100 countries.

About ONICIT®/ALOXI® (palonosetron HCI)

ONICIT®/ALOXI® injection 0.25 mg/5 is used in adults to help prevent nausea and vomiting on the day of chemotherapy that is highly likely to cause nausea and vomiting, and up to five days following chemotherapy that is moderately likely to cause nausea and vomiting.

For additional information please see the EU Summary of Product Characteristics

About the Helsinn Group:

Helsinn is a privately-owned pharmaceutical group with an extensive portfolio of marketed cancer care products and a robust drug development pipeline. Since 1976, Helsinn has been improving the everyday lives of patients, guided by core family values of respect, integrity and quality. The Group works across pharmaceuticals, biotechnology, medical devices and nutritional supplements and has expertise in research, development, manufacture and the commercialization of therapeutic and supportive care products for cancer, pain and inflammation and gastroenterology. In 2016, Helsinn created the Helsinn Investment Fund to support early-stage investment opportunities in areas of unmet patient need. The company is headquartered in Lugano, Switzerland, with operating subsidiaries in Switzerland, Ireland, the U.S., Monaco and China, as well as a product presence in approximately 190 countries globally.

To learn more about Helsinn Group please visit www.helsinn.com

About BERLIN-CHEMIE AG and the MENARINI Group

BERLIN-CHEMIE AG is a subsidiary of the MENARINI Group, the leading pharmaceutical company in Italy with an annual revenue of more than 3.6 billion euros and more than 17,000 employees worldwide. This puts the Group in 13th place out of 5,345 companies in Europe and 36th out of 21,587 companies worldwide (Source: IQVIA). The MENARINI Group has always pursued two strategic objectives: research and internationalization, and has a strong commitment to oncology research and development. As part of such commitment to oncology, MENARINI, is developing four investigational new oncological drugs. Two of them are biologics, namely the anti CD157 antibody MEN1112, and the toxin-conjugated, anti CD205 antibody MEN1309. In addition, MENARINI has recently added two small molecules to its oncology pipeline, the dual PIM and FLT3 kinase inhibitor MEN1703, and the PI3K inhibitor MEN1611, in clinical development for the treatment of a variety of hematological and/or solid tumors. MENARINI is active commercially in the most important therapeutic areas with products for cardiology, gastroenterology, pneumology, infectious diseases, diabetology, inflammation, and analgesia.

With 16 production sites and 7 Research and Development centers, the MENARINI Group has a strong presence throughout Europe and Asia, Africa, Central and South America. MENARINI Group products are available in 136 countries worldwide. For further information: www.menarini.com

Helsinn Group Media Contact

Paola Bonvicini

Group Head of Communication

Lugano, Switzerland

Tel: +41 (0) 91 985 21 21

Info-hhc@helsinn.com

For more information, please visit www.helsinn.com and follow us on TwitterLinkedIn and Vimeo

Menarini Group Media Contact

Menarini Group Press Office

ufficiostampa@menarini.it

Khondrion announces first patients dosed in Phase IIb study of Sonlicromanol for mitochondrial diseases

Khondrion announces first patients dosed in Phase IIb study of Sonlicromanol for mitochondrial diseases

Study will examine impact on cognitive function from one of the most advanced disease-modifying drug treatments for mitochondrial disease in development

NIJMEGEN, the Netherlands – Monday January 27, 2020: Khondrion, a clinical-stage pharmaceutical company discovering and developing therapies targeting mitochondrial disease, today announces that the first patients have been successfully dosed in its phase IIb KHENERGYZE study of Sonlicromanol (previously known as KH176), its wholly-owned lead asset in development to treat a range of mitochondrial diseases.

KHENERGYZE is being initiated at three internationally recognised mitochondrial disease centres in Europe – Radboud University Medical Center, Nijmegen, Netherlands; Newcastle University, United Kingdom and Ludwig-Maximilians-University of Munich, Germany. The double-blind, randomised, placebo-controlled three-way cross-over study examining cognitive function will recruit patients with a specific genetically confirmed DNA mutation in the mitochondrial transfer RNALeu(UUR) (MT-TL1m.3243A>G). This mutation is responsible for MELAS spectrum disorders, including MELAS (mitochondrial encephalomyopathy, lactic acidosis, and stroke-like episodes) and MIDD (maternally inherited diabetes and deafness) syndromes, and mixed phenotypes.

The study’s primary objective is to evaluate the dose-effect of Sonlicromanol on the attention domain score of cognitive functioning, as assessed by a computerized Cogstate visual identification test. Results are expected in the second half of 2020.

Sonlicromanol is a potentially first-in-class oral small molecule and one of the most advanced disease-modifying drug treatments for mitochondrial disease in development, having shown clinical proof of concept and efficacy, and a well-tolerated safety profile in phase I and IIa studies. It has been granted Orphan Drug Designation for MELAS spectrum disorders, Leigh disease and patients with MIDD in Europe and for all inherited mitochondrial respiratory chain disorders in the USA.

Prof. Dr. Jan Smeitink, Chief Executive Officer at Khondrion, said: “The start of our phase IIb trial is another significant milestone for Khondrion as we aim to bring this important treatment to patients suffering from these devastating mitochondrial diseases. This study is targeting the most frequently encountered group of mitochondrial disorders, estimated to affect around 50,000 people in Europe, US and Japan. Their impact on everyday life can be significant, particularly from cognitive impairment which affects everything we do involving thought or memory – whether that’s getting ready for work, chatting with friends or planning for the future.

“We believe Sonlicromanol has the potential to be an important disease-modifying treatment option and could address a significant unmet medical need and improve the lives of patients with mitochondrial diseases.”

Further details of the KHENERGYZE study are available here through ClinicalTrials.gov.

About Khondrion

Khondrion is a clinical-stage pharmaceutical company discovering and developing therapies targeting mitochondrial disease. Founded by Prof. Jan Smeitink, a world-leader in mitochondrial medicine, the company is advancing its proprietary science through a wholly-owned clinical and preclinical small molecule pipeline of potential medicines.

Khondrion’s lead asset, Sonlicromanol, is a potentially first-in-class oral small molecule in phase IIb clinical development to treat a range of mitochondrial diseases including m.3243A>G spectrum disorders including MELAS (mitochondrial encephalomyopathy, lactic acidosis, and stroke-like episodes), maternally inherited diabetes and deafness (MIDD) and mixed phenotypes. It has been granted Orphan Drug Designation for MELAS spectrum disorders, Leigh disease and patients with MIDD in Europe and for all inherited mitochondrial respiratory chain disorders in the USA.

The company’s in-house discovery engine is using unique live-cell imaging technologies, patient-derived cell lines and predictive cell-based disease models to build a portfolio of promising compounds. Active discovery programmes are underway developing new therapies, biomarkers and new read-out technologies in the field of mitochondrial diseases.

To accelerate the discovery and development of its potential medicines for mitochondrial diseases, Khondrion collaborates with a global clinical and academic network and patient organisations internationally. Khondrion is headquartered in Nijmegen, The Netherlands. For more information visit www.khondrion.com

About mitochondrial disease

Mitochondrial disease occurs when mitochondria, found within all cells of the human body and responsible for producing the energy necessary for life, are defective. This can result in a wide range of serious and debilitating illnesses, signs and symptoms of which can include: cognitive problems, learning disabilities, blindness, deafness, heart failure, diabetes, fatigue, intolerance to exercise, muscle weakness and gait problems, and stunted growth. Orphan diseases of the oxidative phosphorylation system like Leigh disease, MELAS (mitochondrial encephalomyopathy, lactic acidosis, and stroke-like episodes) spectrum disorders, MIDD (maternally inherited diabetes and deafness), LHON (Leber’s hereditary optic neuropathy) and other respiratory chain/ oxidative phosphorylation disorders, are all examples of mitochondrial disease.

Contacts:

Khondrion BV
Prof. Dr. Jan Smeitink, CEO
E-mail: info@khondrion.com
Tel: +31-24-3617505
www.khondrion.com

Consilium Strategic Communications
Mary-Jane Elliott, David Daley, Melissa Gardiner
E-mail: khondrion@consilium-comms.com
Tel: +44 20 3709 5700

Fitch affirms Indonesia’s sovereign credit rating at stable outlook

Jakarta (ANTARA) – Fitch Ratings (Fitch) affirmed Indonesia’s Sovereign Credit Rating at BBB, with a stable outlook, as announced on January 24, 2020.

Fitch’s affirmation on Indonesia’s rating at BBB/stable outlook reflects the acknowledgement of Fitch on Indonesia’s economic resilience amidst ongoing global economic dynamics, supported by strong synergy of policy mix between Bank Indonesia and the Government, Bank Indonesia Governor Perry Warjiyo noted in response to the statement.

Going forward, Bank Indonesia will continue to monitor domestic and global economic developments in using its room to implement an accommodative policy mix and strengthen coordination with the government to boost Indonesia’s economic growth momentum, Executive Director of the BI Communication Department Onny Widjanarko noted in a statement in Jakarta, Monday.

According to Fitch, key factors that support the affirmation are a favorable medium-term growth outlook and a small government debt burden compared with the BBB category peers. On the other hand, Fitch underscores challenges faced include a strong dependence on external financing, low government revenue, and lagging structural indicators, including governance indicators and gross domestic product (GDP) per capita.

Fitch expects Indonesia’s GDP growth to likely remain resilient in the next few years, underpinned by a renewed public infrastructure push and reform agenda during the second five-year term of President Joko Widodo.

The government’s efforts, focused on structural reforms, can potentially boost economic growth and foreign direct investment over the medium term, depending on details and implementation.

The Parliament is scheduled to discuss two Omnibus Laws in the subsequent few months that are likely to contain several long-awaited amendments to regulations linked to taxation and the business environment.

From the fiscal side, the Indonesian government debt is low at a Fitch-estimated 30.1 percent of the GDP in 2019. Fitch expects the debt/GDP ratio to rise only marginally in the next few years, assuming the government continues to adhere to a self-imposed deficit ceiling of three percent of the GDP.

Inflationary pressures are likely to remain muted in the current growth environment. Inflation has been under control in recent years, staying within Bank Indonesia’s (BI’s) target range of 3.5 percent, give or take one percent.

On the external front, favorable market conditions have facilitated a further build-up of foreign-currency reserves to US$129 billion in December 2019.

Fitch expects the current account deficit to remain at 2.7 percent of the GDP in 2019 and 2020 and to slightly plunge to 2.6 percent in 2021, with net FDI inflows covering over half of the gap, leaving the remainder to be financed by portfolio inflows.

Strong structural reform implementation and foreign companies’ perception of an improved level-playing field can help expedite FDI inflows and strengthen Indonesia’s external finances.

Fitch considers the sovereign’s exposure to banking-sector risks as limited. Private credit represents only 36 percent of the GDP, and the banking sector’s capital adequacy ratio remains strong, at 23.7 percent in November 2019.

Foreign-currency loan exposure for Indonesia’s banks is equivalent to some 15 percent of the total loans, although foreign-currency assets and liabilities are generally well-matched or hedged, and some liabilities relate to funding from banks’ foreign parents.

Source: ANTARA News