Our “Off The Wall” Blog
is now Monument #Unfiltered

Subscribe below to receive our unique, straight-forward, unfiltered wealth advice delivered straight to your inbox.

Like the BRICs? Check Out Indonesia

U.S. News and World Report Smarter Investor

Indonesia offers a similar investment opportunity, but with less volatility than BRIC countries.

You may have heard that the BRIC countries (Brazil, Russia, India, and China) can offer a potentially high-growth, long-term investment opportunity. Their large populations, rich natural resources, and strong export growth typically attract attention and, in general, these emerging markets have produced solid performance over the past several years. However, with the limelight on the BRIC countries, investors may be missing out on a less-discussed, but potentially stronger performing market: Indonesia.
The same factors that have driven high performance in BRIC countries exist in Indonesia. Additionally, each of these factors has the potential to substantially increase the future output of the Indonesian economy:


Indonesia is currently the world’s 4th most populous nation with roughly 240 million people, behind only China, India, and the United States. This provides ample domestic demand, and a large pool of low-cost laborers to fuel productivity.

Rich natural resources.

Large domestic oil and metals deposits provide a substantial base of resources for domestic production. As the world’s largest producer of tin, and with the second largest natural gas reserves and the third largest coal reserves, commodity exports play a large role in the Indonesian economy.

Strong exports.

Indonesia is a top exporter of palm oil, rubber, timber, tobacco, cocoa, coffee, tea, and spices, as well as other agricultural products. This provides a solid core for the output of the economy and complements the natural resource and tourism components of a well-diversified economy.

Strong economic fundamentals.

The Indonesian economy has benefited over the past several years from a democratization movement which began in 1999. The government instituted economic reforms, which have led to a substantial reduction in the country’s debt-to-GDP ratio, now at roughly 30 percent. Interest rates are low, signaling a central bank focused on economic growth. And while inflation has been steady between 5 and 6 percent annually, the GDP growth rate has continued to be strong. In fact, despite the 2007-2009 financial crisis, Indonesia’s economy avoided recession.

Differences from the BRICs.

Although Indonesia has large domestic oil reserves, they have recently become a net importer of oil. This means that the supply of crude in the economy is mostly insulated from the wild price swings and productivity costs that many of the BRIC economies have faced. It also means that Indonesians don’t have to compete with China and other emerging markets for access to the global supply of oil.

The democratization movement that took hold in the late 1990s has made significant progress in liberalizing the country. As an added benefit to investors, the government has recently enacted pro-growth policies and economic stimulus programs that have improved growth rates and general economic stability. In fact, some estimates range as high as 20 percent annual growth in private investments year over year.

Energy independence and a relatively stable political system have allowed Indonesia to enjoy a substantial increase in foreign investment, especially in contrast with China―where direct investment is difficult. Investors have easy, direct access to Indonesian equity and debt markets.

Whether you hold a broad emerging markets portfolio, a more specific BRIC portfolio, or are considering your first investment into emerging markets, now may be a good time to consider Indonesia. Over the past several years, a comparison between the BRIC countries and Indonesia shows that Indonesia offers a lower volatility profile with higher potential total returns. A strong infrastructure, stable government, attractive natural resources, and robust exports make this “sleeper” emerging market worth a look.

Timothy R. Lee, CFP®, is a managing director and cofounder of Monument Wealth Management in Alexandria, Va., a full-service investment and wealth management firm. Monument Wealth Management is backed by LPL Financial, an independent broker-dealer and Registered Investment Advisor, member FINRA/SIPC. Monument Wealth Management has been featured in several national media sources over the past several years. Follow Tim and Monument Wealth Management on their blog Off The Wall, on Twitter at @MonumentWealth, and on their Facebook page. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendation for individual. To determine which investment is appropriate please consult your financial advisor prior to investing. All performance references are historical and are not a guarantee of future results. Strategies involving asset allocation and diversification do not ensure a profit or protect against a loss.

Read the article on U.S. News & World Report here! >>


Please remember that past performance is no guarantee of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Monument Capital Management, LLC [“Monument”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Monument. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. No amount of prior experience or success should be construed that a certain level of results or satisfaction will be achieved if Monument is engaged, or continues to be engaged, to provide investment advisory services. Monument is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice.

A copy of Monument’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at www.monumentwealthmanagement.com/disclosures. Please Note: Monument does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Monument’s website or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

Historical performance results for investment indices, benchmarks, and/or categories have been provided for general informational/comparison purposes only, and generally do not reflect the deduction of transaction and/or custodial charges, the deduction of an investment management fee, nor the impact of taxes, the incurrence of which would have the effect of decreasing historical performance results.  It should not be assumed that your Monument account holdings correspond directly to any comparative indices or categories. Please Also Note: (1) performance results do not reflect the impact of taxes; (2) comparative benchmarks/indices may be more or less volatile than your Monument accounts; and, (3) a description of each comparative benchmark/index is available upon request.

Please Remember: If you are a Monument client, please contact Monument, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.  Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. Please Also Remember to advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Get Monument #Unfiltered: Our Free Private Wealth Newsletter

Our no B.S. wealth advice delivered 2x per month, max. Tuned specifically for busy, high-net-worth business professionals and investors who want straightforward advice without the fluff.