Food Industry Becomes Main Driver of Manufacturing Growth in Indonesia
Indonesia’s consumption sector continues to support the country’s economic growth. The Investment Coordinating Board (BKPM) reported on Wednesday (12/30) that investment plan by food companies has tripled and dominated the manufacturing sector in 2015
The application for principle license in the food sector this year reached IDR184.92 trillion and accounts for 32.31 percent of total investment plans in the manufacturing sector of IDR577.29 trillion. This is consisted of domestic investment of IDR21.19 trillion and foreign investment of IDR163.73 trillion. “This is an indication that the food sector will still become the main growth driver of the manufacturing sector in the next few years,” said Head of BKPM Franky Sibarani.
According to Sibarani, the increase in investment in food sector is also an indication that the government’s efforts to make Indonesia a production base in the face of ASEAN Economic Community (AEC) began to yield results.
Statistics Indonesia reported earlier that food production is the only labor-intensive industry in the manufacturing sector that recorded a growth of 7 percent. This is in contract with other labor-intensive industries that recorded a decline in production such as the apparel industry of 12.01 percent, beverage industry of 7.38 percent and transport equipment industry of 5.71 percent. Other manufacturing industries that recorded a production growth are pharmaceutical of 15.31 percent, processing of 13.53 percent, and machinery and equipment industries of 8.28 percent.