Indonesian Manufacture Industry Still Expanding Positively

Indonesian Manufacture Industry Still Expanding Positively

The performance of the national manufacturing industry shows its aggressiveness as the increase of the domestic market demand and the business expansion. This performance is based on the purchasing manager index (PMI) report that released by Nikkei.


It is suit with government efforts to create a conducive investment climate and provide the simple of licensing process for Indonesian company in the business. In April 2018, Nikkei noted that the PMI Indonesia’s manufacturing was at 51.6, or it is increase compared to the previous month which reached 50.7. A PMI that above 50 indicates that manufacturing is expanding.


The index in the fourth month of the year is in the best position since 22 months ago or June 2016. The movement of the PMI index is supported by a steady stream of new jobs, especially the sharpest level of expansion since the mid of June 2016. Furthermore, it is influenced by the rise in consumer demand, especially from the domestic market.


The released of Nikkei Indonesia Manufacturing PMI was compiled based on data that compiled from monthly responses through questionnaires that has sent to more than 300 industrial companies. The surveyed of the manufacturing sector is divided into eight main groups, which are basic metal, chemical and plastic, electricity and optic, food and beverage, mechanical engineering, textile and apparel, wood and paper, and transportation.


Indonesian Government confirmed that he and his staff will determine to boost the growth of manufacturing industry. It is just because the processing activities consistently carry multiple effects for the national economy, such as an increase in the value added of domestic raw materials, the using of local man powers, and foreign income from exports.


Until now the Government still focusing on running of the downstream industries. Moreover, the Ministry of Industry actively carry the investment and boosts the export activities. The industries are also the biggest contributor of taxes and customs.


Indonesia has been becoming the biggest Ease of Doing Business (EODB) that increase during the last two years, compared to other ASEAN countries. The EODB of Indonesia in 2017 is on 72nd position, up 34th rank from 2015 that ranking on 106th.


Other Asean countries, such as Thailand and Vietnam only have risen 20 and 23 rank. While the Philippines has felt 14 rank, and Malaysia has felt two ranks. Indonesia is also Improving an economic cycle that brings it into the part of the global economic power.


Indonesia will come out from the middle income trap and become a developed country by 2030, on the position of seventh in the world.


In fact, by 2050 Indonesia will be able to go up to fourth in the world. This will be the momentum of 100 years of independence. It is because in the next 15 years or start around 2030, Indonesia will enter a period of demographic bonus, where the population will be dominated by the productive age. Just like Japan, China, Singapore and Thailand, after entering the period of demographic bonus, their economic growth is very high.


Based on data that released by the Investment Coordinating Board (BKPM), the investment in the manufacturing sector during the first quarter/2018 has reached Rp62,7 trillion. The realization was from the  domestic investmentRp 21.4 trillion, and from foreign investment of 3.1 billion US dollars. The sector of metal, machinery and electronic industries are the biigest contributor with the amount investment of Rp22.7 trillion.


Disclaimer: This article is a summary of news articles obtained from a number of mass media. We are not responsible for the accuracy of data or sources of information presented by the mass media that became the reference.

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