Why Indonesia is the first choice for beauty to go overseas?

Indonesia, which has the highest total GDP in ASEAN, is becoming a key market for Chinese beauty to go overseas.

General Administration of Customs data show that, in RMB, the first half of this year, China's trade in goods import and export value of 21.17 trillion yuan, an increase of 6.1%, the first time in the same period in history more than 21 trillion yuan. Among them, exports 12.13 trillion yuan, up 6.9%; imports 9.04 trillion yuan, up 5.2%.

ASEAN continues to remain China's top trading partner. China's trade with ASEAN totaled 3.36 trillion yuan, an increase of 10.51 TP3 T. Among them, exports to ASEAN amounted to 2.03 trillion yuan, a year-on-year increase of 14.21 TP3 T. Among the ASEAN members, the top three trading partners with China are Vietnam, Malaysia and Indonesia, in that order.

01 Economic development, demographic dividend ...... Huge demand for beauty products

According to Statista data, Indonesia's beauty and personal care market is forecast to reach $9.6 billion in 2027, and the market's online revenue size will reach $9.17 billion in 2024. Meanwhile, with a Muslim population of over 200 million, Indonesia is the most populous Islamic country in the world, and is the largest country in the entire Southeast Asia in terms of halal beauty demand.

Economic development is a key driver of huge beauty demand. As one of the largest economies in Southeast Asia, Indonesia's economic development has been in the spotlight in recent years, with an average GDP growth rate of around 5% maintained over the past decade, and a growth rate of 5.05% in 2023, with a per capita GDP of US$4,920.

As the fourth most populous country in the world, Indonesia's large and young population provides an ample demand market for the beauty industry. Of the population of more than 270 million, the under-30 group accounts for more than 50%, and the middle class population is expected to reach 135 million by 2030.

In addition, the development of online sales channels has also boosted the demand for beauty products. Due to its young demographic structure, the Internet penetration rate of Indonesia's online channel is as high as 79.51 TP3 T. Currently, there are several e-commerce platforms in Indonesia, including Shopee, TikTok, Blibli, and Lazada. With the popularity of e-commerce platforms, Chinese beauty brands have unprecedented development opportunities.

02 Trade Policy, Halal Certification ...... A Passport to Impacting the Indonesian Market

For Chinese beauty brands and companies planning to go overseas, the first step to successfully enter the Indonesian market and achieve long-term development is to have an in-depth understanding of the country's trade policies.

In recent years, Indonesia has adjusted its tariff policy on imported goods several times, gradually lowering the duty-free threshold from an initial US$100 to US$75 and further to US$3, and imposing restrictions on cross-border goods in 13 major categories (including apparel, cosmetics, and bags, among others) in 2021.

In June this year, according to Reuters and other foreign media reports, Indonesia announced that it would impose safeguard tariffs ranging from 1,00% to 1,00% on imports of cosmetics, footwear, apparel, textiles and ceramics in order to strengthen protective measures for Indonesian industries. Subsequently, in order to balance domestic demand, Indonesia has exempted cosmetics arriving at Indonesian ports from the submission of import licenses (PI), requiring only the submission of import supervision reports (LS) and import declarations (SKI) for customs clearance.

At the same time, Muslim countries represented by Indonesia have made Halal certification (also known as "HALAL certification") a mandatory threshold for the import of cosmetic products to ensure that the products comply with the Islamic Shariah guidelines, so that Muslim consumers can rest assured that these products can be used. In short, Halal certification is a passport for products to enter the Muslim consumer market.

In Indonesia, for example, from October 2024, all food, beverage, pharmaceutical, cosmetic, chemical, biological and genetically modified and other related products, except for the exempted list, will be required to obtain halal certification within a specified period of time before being exported to Indonesia.

For Chinese cosmetic enterprises to impact the Indonesian market, they not only need to understand local trade policies and comply with local laws and regulations, but also plan for halal certification and other relevant qualifications as early as possible.

03 In-depth Matchmaking, Specialty Tours ...... Precision Matchmaking will be here

On August 12, the China-Indonesia Beauty Business Matchmaking Meeting, hosted by China Beauty Network and co-organized by Indonesia Cosmetic Association and Shanhaitu, will be officially launched at Pullman Jakarta. As a global beauty industry chain collaboration platform, China Beauty Network has a deep insight into the development opportunities of Indonesia's cosmetics industry.

More than 1,000 people from China and Indonesia will gather to explore new opportunities for growth in the beauty industry and to promote the long-term, sound and mutually beneficial development of the beauty industry in China and ASEAN.

The meeting will be centered on hot topic sharing, in-depth business matching and characteristic study tour experience, aiming to provide a diverse and rich communication experience for the participants.

Business Matchmaking will bring together Chinese and Indian enterprises in skincare, color cosmetics, toiletries, beauty tools, foundries, packaging materials, raw materials, etc., providing the most direct and effective stage for enterprises of the two countries to display and communicate. Participating enterprises will not only be able to accurately convey their demands and find solutions face-to-face, but also explore more business opportunities for cooperation here.

The tour experience will lead enterprises to visit Indonesian cosmetic factories, brands, channels and local service providers in-depth, and through on-site visits, we will gain a deeper understanding of the current situation and potential of the Indonesian market, so as to provide a more specific, in-depth and effective reference and learning for the cooperation between enterprises of the two countries.

The China-Indonesia Beauty Business Matchmaking Conference will be kicked off soon, and more quality overseas resources and new opportunities for cooperation will be born soon, so stay tuned.

This docking session takes the form of fixed quota and targeted invitation to precisely match resources for participants. For enterprises interested in exhibiting, please scan the QR code below for consultation.