The Ministry of Investment/Coordination and Investment Agency (BKPM) noted that the realization of investment in the manufacturing sector during the first quarter of 2022 reached IDR 103.5 trillion. This achievement contributed 36.6% of the total investment realization in the first quarter of 2022 which reached IDR 282.4 trillion. In percentage terms, the proportion is the highest since 2018 to 2019 which is in the range of 30.8%-31.6%, although it is still below the service sector whose proportion is in the range of 44%.
Economist of the Center of Reform on Economics (Core) Indonesia Yusuf Rendy Manilet said, when viewed from the business sector component, the manufacturing industry that contributed to investment realization in the first quarter of 2022 were sectors that previously also contributed to investment realization in the manufacturing sector. base metal industry which is a downstream product from nickel mining. "As we know, the government's efforts to encourage nickel downstream have been quite massive at least in the past year," Yusuf told Kontan.co.id recently. For this year itself, Yusuf estimates that he will continue the positive growth trend in line with the continued investment in domestic smelters. "Furthermore, if the government is successful in following up on Elon Musk's meeting some time ago, it could also be a potential investment, especially in the downstream side of nickel derivative products," he explained.
Meanwhile, other labor-intensive manufacturing industries, such as the automotive industry, will also be encouraged by the continued sentiment of economic recovery and the ongoing implementation of the Sales Tax on Luxury Goods (PPnBM) incentives for automotive products. With the increase in demand and the provision of incentives, according to him, the realization of investment in this sector will certainly be encouraged. Furthermore, Yusuf said, while for other labor-intensive industries such as textiles, the recovery process also has the potential to be better than last year. One of them is in line with the momentum of the month of Ramadan and Eid which can encourage demand for textile products such as clothing, especially this year's Eid moment which is projected to be larger than last year. "I think the service sector and industry will both move positively this year, but I think the proportion of investment realization in the service sector still has a bigger chance than the manufacturing industry," he said.
