5 Corporate Strategies to Leverage Indonesia-China Relations Opportunities Amid...
As global geopolitical tensions rise due to the heating relations between the United States–Israel and Iran, as well as the United States’ trade policy imposing temporary global import tariffs of up to 15 per cent, Asia is increasingly emerging as one of the world’s economic centres.
In this context, Indonesia holds a strategic position with strong growth prospects and relatively stable domestic conditions. Increasing regional connectivity is also strengthening Indonesia’s integration into regional trade and investment flows, including through economic partnerships with China, which are becoming an important pillar in the regional supply chain and investment.
In facing these dynamics, comprehensive strategies are needed so that businesses can remain resilient while optimising available opportunities. There are several strategy recommendations from the banking world, in this case Bank DBS, to help corporations, including companies involved in cross-border business activities with China, remain adaptive and capture opportunities amid global uncertainty.
- Anticipate Geopolitical Risks with Diversification of Markets and Regional Supply Chains
The Asian region continues to show relatively strong growth prospects with China as one of the main drivers. DBS Group Research projects that the Chinese economy will continue to grow at around 4.5 per cent, supported by accommodative monetary policies, thus maintaining regional trade and investment activities. For Indonesian corporations, this situation opens opportunities to balance global risks through market diversification and strengthening involvement in regionally integrated supply chains with China as the global manufacturing hub.
However, cross-border expansion also brings challenges, ranging from regulatory changes, demand fluctuations, to exchange rate volatility. Therefore, corporations need to strengthen operational resilience through diversification of logistics routes, expansion of partner networks, and implementation of scenario planning and financial flexibility to remain adaptive in the face of continuously changing global dynamics.
- Manage Exchange Rate Risks in Cross-Border Business
In the context of cross-border business, including Indonesia–China trade relations, DBS Group Research estimates that USD/IDR will be in the range of Rp16,350 by the end of 2026, continuing the dollar strengthening trend that has been ongoing since 2025. Although Bank Indonesia (BI) continues to intervene to maintain rupiah stability, external pressures still have the potential to trigger significant fluctuations. Corporations with exposure to raw material imports, foreign currency debt, or cross-border projects are the most vulnerable to this risk.
In this context, exchange rate risk management is no longer optional. Strategies such as hedging, natural hedging through cash flow matching, and adjusting financing structures based on revenue currencies become important steps to keep margins and cash flows healthy. A disciplined approach will help corporations remain competitive without being eroded by foreign exchange market volatility.