Industry
From The Report: Indonesia 2020
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With the largest land mass, population and economy in South-east Asia, Indonesia has considerable potential to become the region’s industrial powerhouse. Nevertheless, with a development model traditionally reliant on the export of natural resources rather than processed goods, the Indonesian industrial sector remains below its potential. Indeed, in terms of output and exports of manufactured products, the country lags behind many of its neighbours. The expansion of the sector has been further hindered by restrictions on foreign investment, in conjunction with the relative underdevelopment of the county’s infrastructure network. However, this situation has changed in recent years, with the government identifying the industrial sector as a key driver of economic growth and diversification. The current administration aims to turn the country into a leading regional manufacturing centre, in part by easing the investment process for foreign firms and offering incentives, including through increasing the number of special economic zones. This chapter contains interviews with Agus Gumiwang Kartasasmita, Minister of Industry; and Rosan Roeslani, Chairman, Indonesian Chamber of Commerce and Industry.

Articles from this Chapter

Overview

Manufacturing development: Investment reforms and labour market liberalisation clear the way for expanded industrial output
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With the largest land mass, population and economy in South-east Asia, Indonesia has considerable potential to become the region’s industrial powerhouse. Nevertheless, with a development model traditionally reliant on the export of natural resources rather than processed goods, the Indonesian industrial sector remains below its potential. Indeed, in terms of output and exports of manufactured products, the country lags behind many of its neighbours. The expansion of the sector has been…

Analysis

Road ahead: A new policy framework aims to support the development of electric vehicle manufacturing
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The government’s Making Indonesia 4.0 strategy was launched in 2018 and outlines steps to enable the country to capitalise on the evolving trends of manufacturing provided by the Fourth Industrial Revolution. These include the application of new digital and automated technologies to improve production processes and service delivery. Key priorities of the roadmap include the development of a domestic electric vehicle (EV) manufacturing industry. Efforts to develop Indonesia’s EV industry…

Interview

Top form: Agus Gumiwang Kartasasmita, Minister of Industry, on improving supply chains and harnessing technology
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Interview:Agus Gumiwang Kartasasmita What is being done to boost the export capacity of small and medium-sized enterprises (SMEs)? AGUS GUMIWANG KARTASASMITA: The Ministry of Industry (MoI) has, at its core, the goal of enabling SMEs to access the global market. There are currently four main programmes in place to boost the export capacity of SMEs. The first seeks to match SMEs with larger production companies and build connections between them. This allows smaller companies to build greater…

Interview

Value-added growth: Rosan Roeslani, Chairman, Indonesian Chamber of Commerce and Industry, on enhancing manufacturing competitiveness
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Interview:Rosan Roeslani What can be done to boost the position of Indonesian manufacturing within the region? ROSAN ROESLANI: As a developing nation, one very important task for Indonesia is to ensure that the regulatory environment for businesses matches that of developed countries. We need to ensure that our policies create an enabling environment for our economy to flourish – particularly with regards to the manufacturing industry, which has been identified as essential to both economic…

Analysis

Vital deliveries: The global distribution of medical goods and foodstuffs has become the primary focus of efforts to keep essential supply chains open during the Covid-19 pandemic
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As globalisation has increased, the world’s supply chains have become substantially more interconnected. Moreover, as emerging market economies have steadily come to account for a greater proportion of global GDP, goods often have more stages to pass through before reaching the end consumer. From national lockdowns to closed airspace and borders, the spread of Covid-19 in the first half of 2020 resulted in unprecedented disruption to the mechanics of most economies, regardless of their…