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Indonesia #43 in ranking of world’s top nations

BEST COUNTRIES 2019

 

Indonesia #43 in ranking of world’s top nations

Scores up for Transparency & Green Living

 

 

Indonesia ranks 43rd out of 80 countries in the latest global Best Countries ranking, an international study identifying the strengths, weaknesses and changing perceptions of countries.

 

The country has lost some of its sheen due to dips in its attractiveness as a place to start a business, invest and study, and perceptions around entrepreneurship have also slipped.

 

How people around the world feel about other countries is of huge significance for brands, because consumers tend to apply their sentiment regarding a place to the products, services and even the people who come from there.

 

The annual Best Countries study found that 77 percent of people around the world "prefer to purchase products when I know which country they were made in".

 

The Best Countries Report is now its in fourth year. It is the world’s largest study of nation brands, based on research among more than 21,400 people. Best Countries is a project by U.S. News & World Report, BAV Group and the Wharton School of the University of Pennsylvania.

 

The rankings evaluate 80 countries across a range of categories, from economic influence and military might to education and quality of life, to capture how nations are perceived on a global scale.

 

Why the drop?

 

Adults aged 35 or younger actually see Indonesia in a more positive light than they did a year ago, and among this group alone, Indonesia ranks #39 in the world out of 80 countries, having overtaken the Philippines and Hungary. It is the way Indonesia is regarded by older adults, business decision-makers and those we call “Informed Elites” due to their education and income that has led to the overall decline.

 

Among Business Decision-Makers, Indonesia ranks #44 in the world, down from #37 in 2018.  Adults aged 45+ put the country in 45th place, down from 42 a year ago, and Informed Elites put Indonesia at #42, down three places.

 

Although the country’s performance on key business-related measures such as entrepreneurship and starting a business have declined, and this explains the overall drop in the ranking, Indonesia has made gains in two other sectors that are becoming increasingly important both to consumers and businesses. Indonesia has improved its position in the ranking for transparency (up 13 places to #43) and for green living (up six places to #50).

 

 

How Indonesia compares to the world

 

 

Indonesia’s reputation, according to the Best Countries Report, is centred on its sense of dynamism and its can-do spirit. The country attains its best scores on the 80-country ranking for being a good place to run a business, for being friendly and fun, and for its rich cultural heritage.

 

 

The 8 elements of a country’s brand

 

Adventure: a country is seen as friendly, fun, has a pleasant climate, and is scenic or sexy.

 

Citizenship: it cares about human rights, the environment, gender equality, is progressive, has religious freedom, respects property rights, is trustworthy, and political power is well distributed.

 

Cultural influence: it is culturally significant in terms of entertainment, its people are fashionable and happy, it has an influential culture, is modern, prestigious and trendy.

 

Entrepreneurship: it is connected to the rest of the world, has an educated population, is entrepreneurial, innovative, and provides easy access to capital. There is a skilled labour force, technological expertise, transparent business practices, well-developed infrastructure, and a well-developed legal framework.

 

Heritage: the country is culturally accessible, has a rich history, has great food, and many cultural attractions.

 

Open for business: manufacturing is inexpensive, there’s a lack of corruption, the country has a favourable tax environment, and transparent government practices.

 

Power: it is a leader, is economically and politically influential, has strong international alliances and a strong military.

 

Quality of life: there’s a good job market, affordable living costs, it’s economically and politically stable, family-friendly, safe, has good income equality and well-developed public education and health systems.

 

Movers: a metric predictive of a country’s future growth in terms of per capita (purchasing power parity) gross domestic product.

 

Each of the nine measures is given a weighting in its contribution to the total score for each country, as follows:

The weight of each category in the final index is determined by the strength of its correlation to per capita GDP (at purchasing power parity).

As seen in the graphic below, a nation focused on providing great quality of life for its people, which cares about rights and equality, and has a focus on entrepreneurship, is seen as having the most powerful nation brand. This reflects how the world has changed; no longer is it just tanks and banks that give a country influence around the world. Hard power is making way for softer power that comes about as a result of entrepreneurship and cultural exports.

In addition to the eight categories above, a momentum metric called “Movers” represents 14 percent of the index, measuring how different, distinctive, dynamic and unique a country is seen to be.

To see the full Best Countries methodology, visit:

https://www.usnews.com/news/best-countries/articles/methodology

 

How Indonesia scores

 

 

Indonesia ranks …

 

 

 

Top of the World

 

The Top 5 countries in the world on the Best Countries ranking have not changed in the past year, though there has been some shifting of positions.

 

Switzerland is once again at the top of the list, fueled by a strong sense of citizenship, entrepreneurship and being widely seen as open for business.

 

Japan has risen to #2 ahead of the 2020 Summer Olympics, due to take place in Tokyo. The country is seen as the most forward-looking nation in the world, and also ranks #1 for entrepreneurship.

 

Canada, Germany and the UK round out the Top 5, as they did a year ago. The US is in eighth position, but its performance on trust has fallen, as have perceptions of the country as a country that cares about human rights. The US is still seen as first in the world for power, followed by Russia at #2.

 

The Nordic countries put in another strong performance, based on measures of “soft power” – influence and desirability that are unrelated to traditional indicators of strength, such as financial and military might. Sweden and Norway both make the Top 10 this year; Sweden is the best country for green living, for women, and for raising children.

 

Other top performers include New Zealand as the best country for retirement, and Canada for quality of life.

 

 

The Best Countries Top 10 in 2019

 

 

 

Local attitudes, unveiled

 

Indonesians are proud of where they’re from, but BAV research shows that they tend to identify more strongly with their city than with the country as a whole (69 percent feel this). They are also more likely to identify as being “citizens of the world” ahead of considering themselves Indonesian (51 percent agree).

 

They are highly confident that their country is heading in the right direction (80 percent agree this is the case), and feel Indonesia is a country that cares about its citizens (83 percent agree).

 

Indonesian people are among the most open in the world to immigration (73 percent agree it’s a force for good, compared to a global average of 54 percent), and almost everyone (93 percent) say it’s of utmost importance to promote diversity, perhaps a reflection of the ethnic and regional diversity for which Indonesia has become famous.

 

While around four in five people say women are owed the same opportunities as men, around the same proportion also believe it is important to maintain traditional gender roles, suggesting a tension between wanting to modernize, but without losing some of what people have grown up with and find comforting.

 

Almost half the population thinks LGBTQ+ people should have the same rights as everyone else.

 

Indonesians tend to trust companies and their government equally when it comes to providing safety, healthcare, economic well-being and privacy. They are also more trusting of traditional news sources than online ones when compared to other countries.

 

 

 

Add to basket? Depends where it’s from

 

This year’s Best Countries research for the first time asks people explicitly about how they feel about products based on their country of origin. This has led to a new ranking: the Origin Index, which ranks consumer preferences across a range of product categories.

 

Indonesia’s performance on this index is mixed; preference for Indonesian goods in certain categories is incredibly strong among local consumers and much lower for different types of products. International buyers find “Made in Indonesia” significantly less appealing than do local consumers. Among the eight product categories that people were asked about, fashion was the one that consumers outside Indonesia were most likely to select a “Made in Indonesia” option.

 

What’s curious about Indonesia’s performance in the Origin Index is how it indicates that global consumers are actually often happy to buy “Made in Indonesia” products, but when asked about it, they are less positive about buying Indonesian.

 

This is likely to be because people are buying things they often don’t realize are Made in Indonesia. This gap between perception and practice indicates a rich seam of opportunity for Indonesian brands.

 

The Origin Index (OI) – how Indonesia performs

 

Indonesians clearly love home-made fashion, food, pharmaceuticals, cosmetics and technology. This is great news for local brands, and underlines the importance of having a deep understanding of the changing tastes and priorities of Indonesian consumers. It also signals the value of highlighting the heritage of a brand in its local communications, particularly in these categories where consumers show a clear preference for local products.

 

Indonesians don’t always think of local products in such a positive light, however. Relatively poor scores locally for Made in Indonesia products were registered in the automotive and healthcare categories. This indicates that there is work to be done by local brands in improving perceptions relative to the international alternatives available.

 

“Connecting to the identities of their home nations can help brands tap into a powerful force, and provide guidance in managing their own branding.” – Michael Sussman, CEO, BAV Group

 

Among consumers outside of Indonesia, lower preferences are reported for Indonesian goods than export figures indicate people are actually buying. Food and fashion are strong exports for Indonesia, as the chart above indicates, yet shoppers are not keen on opting for products – in these categories among others – that are labelled “Made in Indonesia”. For local brands seeking to establish a global footprint, this is a significant challenge: as they grow, they need to simultaneously raise the profile of goods from their country and improve perceptions of quality and credibility around them.

 

Japan is the only country in Asia (excluding Oceania) to make global consumers’ top 10 in any of these product categories. Australia makes the Top 10 in the food and wine categories.

What Indonesian brands should know

Brands need to tailor their brand-building efforts, from product development to communications, according to whether they are targeting local or international consumers, and to preconceptions around how “Made in Indonesia” reflects on the category in which they are operating. While national pride is an opportunity to explore for some home-grown brands, the value of promoting Indonesian heritage, at least in the short term, is often less clear in other sectors and other markets.

 

BAV Group, a division of WPP’s VMLY&R, recommends brands:

-       Borrow from their country’s strengths

-       Shield themselves from their country’s weaknesses

-       Know which attributes should be developed from within the individual brand rather than derived from opinions about the country

-       Understand the commonalities a brand shares with impressions of its country of origin