Indonesia remains a favored destination for global investors expanding into the industrial sector, evidenced by increased investment realization driven by pro-business government policies facilitating permit procedures and offering incentives. Over the 2014-2023 period, investments in the non-oil and gas processing industry fluctuated but trended upwards, indicating sustained investor interest in Indonesia's favorable business climate. Minister of Industry, Agus Gumiwang Kartasasmita, highlighted a significant surge in investment value in the non-oil and gas processing industry from IDR 186.79 trillion in 2014 to IDR 565.25 trillion in 2023. Cumulatively, investments in this sector over a decade totaled IDR 3,031.85 trillion, underlining its attractiveness to investors. Despite the challenges posed by the Covid-19 pandemic, investor confidence in Indonesia remained high. Investments in the manufacturing industry increased notably from IDR 213.44 trillion in 2019 to IDR 457.60 trillion in 2023, demonstrating sustained growth and resilience in Indonesia's industrial sector.
The government's commitment to promoting industrial downstreaming is evident, aiming to enhance competitiveness by developing downstream industries, particularly in mining. This strategic approach has resulted in significant contributions to national revenue through export taxes, royalties, non-tax state revenues, and dividends, with industrial downstreaming being the top priority. Industrial downstreaming has also led to job creation, with the number of workers in the manufacturing industry increasing from 15.62 million in 2014 to 19.29 million in August 2023, notwithstanding the pandemic-related disruptions in 2020. Efforts to maintain industrial sector productivity include diversifying commodities to ensure a stable supply of raw materials and supporting materials domestically, thereby fostering value-added and downstreaming within the country. Indonesia's manufacturing sector performance, as indicated by the Purchasing Manager’s Index (PMI), has shown consistent expansion for 29 consecutive months as of January 2024. This resilience in the face of global challenges sets Indonesia apart, with only Indonesia and India maintaining PMI expansion during this period. Looking ahead, Indonesia's industrial sector remains poised for growth, supported by ongoing government initiatives and sustained investor confidence in the country's business environment.
Source: https://emitennews.com/news/realisasi-investasi-sektor-industri-ini-rp3031-triliun
