(Photo: PT Coca-Cola Amatil Indonesia)

JAKARTA (TheInsiderStories) – Indonesia’s President Joko Widodo has set a roadmap for the implementation of the industry revolution 4.0 to generate economic growth based on digital development in certain sectors.

In this era, Food and Beverage (F&B) is one of the top five industries prioritized by the government for the implementation of industry revolution 4.0. These five industries are petrochemical, automotive, electronic, textile, and F&B.

These sectors will be encouraged to master the technologies that characterize the Industry 4.0 era, including artificial intelligence, internet of things, big data, robotics and 3D printing.

At the distribution stage, Indonesia, as an archipelagic country, is challenged with limited supporting infrastructures, especially for the F&B industry, to connect suppliers and markets. It is highly crucial that this industry ensures that F&B products be transported to population centers from the production areas.

F&B industry needs innovation and security to generate higher growth. One way to achieve this is through engaging in the fourth industrial revolution. In the F&B industry, industry 4.0 can enhance traceability right through the production chain to ensure that machines are interconnected and can archive data.

Putting it more simply, electronic traceability would enable producers to track down items from delivery to supermarket shelves. Furthermore, interoperability in Industry 4.0 can also connect supply chains to deliver a product to the market more efficiently.

After all, industry 4.0 is highly crucial to support the F&B sector in Indonesia. In 2017, F&B exports from Indonesia reached US$ 11.5 billion, growing from US$ 10.43 billion in 2016.

The sector’s contribution to Indonesia’s GDP is 6.14 per cent, while for non-oil and gas GDP is 34.3 per cent. The sector’s growth is also among the highest. It reached a 9.23 per cent growth, far higher than Indonesia’s GDP growth at 5.07 per cent.

Adapting to Industrial revolution 4.0 will further increase this growth and ensure that the F&B businesses can fully optimize their opportunity while minimizing  drawbacks in all stages of their operations.

However, the implementation of the 4.0 industrial revolution is not an easy job, as only few big F&B companies have operated with high technology.

Based on data from Indonesia association of food and beverage entrepreneurs, from total 6,875 entrepreneurs in F&B industry, currently there are only 20 per cent who are ready to face the industry   revolution 4.0.

The application of 4.0 technology in the food and beverage industry is still constrained by large investment capital.

Direct investment in Indonesia’s food and drinks industry is dominated by domestic investors. If we take a look at the data from the Indonesia Investment Coordinating Board, then we see that 60.0 percent of total direct investment in this industry originated from Indonesian investors.

Chairman of Indonesian F&B Association, Adhi Lukman said there are actually many foreign investors interested to invest in Indonesia. However, they are often scared off by regulations that are regarded unconducive. Among the top concerns of foreign investors are the availability of quality human resources and the availability of raw materials.

However, the combination of Indonesia’s more than 250 million population and its robust agriculture and fisheries sector create an almost ideal operating environment for the F&B industry.

These opportunities have not been lost on international or local companies, and the segment continues to attract some invesments of any industril segment.

Email: elisa.valenta@theinsiderstories.com

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