JAKARTA (TheInsiderStories) - Industry Minister Saleh Husin sees Indonesia’s manufacturing sector to grow by 5.7 percent next year, partly triggered by the inflow of investment into the country.
The minister said the manufacturing industry growth is estimated to increase its contribution to the national gross domestic product (GDP) from 17.87 percent in 2015 to 18.5 percent in 2016.
In third quarter (Q3) of 2015, the manufacturing sector, excluding companies in oil and gas, grew by 5.21 percent compared to 4.73 percent in the same period in last year.
Most of the contribution, Saleh added, comes from domestic direct investment (DDI) worth Rp20.5 trillion ($1.50 billion)-up 7.45 percent from the year before-while foreign direct investment fell to $3.15 billion from a year ago $$4.75 billion.
He further said that until August, the country’s export production of non-oil processing industry reached $72.21 billion and import was still quite high at $72.49 billion, however, the deficit has declined compared to last year of $4.17 billion.
“We expect that going forward the deficit in this sector would reduce and maintain a surplus. The main goal to boost export to the US, Japan, Singapore and India,” Saleh stated.
Given this circumstance, he added, the Industry Ministry has been stacking the strategic plan for 2015-2019, which will strengthen the country’s industrial sector, through strengthening the industrial structure, increased value added through developing the downstream projects, an opportunity to try and expansion of employment opportunities.
To reach those target, he said, the ministry is preparing strategy by determination of 10 priority industries outside Java focus in labor-intensive industries and import substitution. The government plans to develop 22 economic zone, build 15 small medium enterprise (SME) centers, buffer stock for cotton and leather industry,
The other strategies are including facilitate the development of industrial development centers for tooling and health, revitalization of the textile industry companies, construction of the railway industry facilities, development of downstream industries for seaweed, restructuring of machine tools, create new industries, HR Training for SMEs, develop construction of industrial facilities and infrastructure industry, increased the availability of energy with competitive price, facilitates bank interest, lowering logistic cost, empowerment industry. (*)