Amidst a global economic downturn, Indonesia's manufacturing sector continues to exhibit robust performance. The Purchasing Managers’ Index (PMI) for Indonesian manufacturing in February 2024 remains in the expansion zone, at a level of 52.7 (compared to 52.9 in January). Despite facing a trend of weakening global economic activity, domestic demand and demand from several key trading partners continue to grow strongly, thus maintaining the momentum of the national manufacturing sector's performance. Some of Indonesia's trading partners that still record expansion in their manufacturing sectors include India (56.7) and the United States (51.5). Meanwhile, the manufacturing PMI for ASEAN countries such as Malaysia and Thailand remains contracted, reaching levels of 49.5 and 45.3, respectively.
"In the midst of a global economic downturn and the ongoing slowdown in manufacturing in several countries, Indonesia is able to maintain a strong manufacturing activity. This achievement will be continuously supported by the optimization of the state budget and ongoing anticipation of current global risks," stated Febrio Kacaribu, Head of Fiscal Policy Agency at the Ministry of Finance, in a written statement on Tuesday, March 5, 2024. Febrio further elaborated that Indonesia's manufacturing performance is influenced by several factors, including domestic demand and anticipation of goods demand ahead of the Ramadan month. "The continued expansion of Indonesia's manufacturing performance is driven by domestic demand levels and the purchase of input goods in anticipation of increased demand ahead of the Ramadan month. Business confidence in February 2024 is at its highest level, indicating the optimism of business players towards Indonesia's production prospects in 2024, which are still relatively high," explained Febrio.
