The minister projects that the manufacturing sector to grow by 5.01% in 2022 and higher in 2023 ranging from 5.1% to 5.4%.
Heaptalk, Jakarta — The Ministry of Industry recorded that the national manufacturing industry sector grew 4.88% in Q3 2022, which increased from 4.33% in the previous quarter. In 2020, the growth dropped to minus 2.52% due to the covid-19 pandemic, but it rose to 3.67% in 2021.
The manufacturing sector contributes 16.10% of the GDP in Q3 2022. According to Minister of Industry Agus Gumiwang Kartasasmita, this figure is the highest among other economic sectors. “This is our joint task in improving industrial performance to become an industrialized country,” said Agus during the press conference of Industry Outlook 2023 (12/27).
On the export side, the sector is recorded positive growth amid unstable world conditions. The value of industrial exports in January-October 2022 reached US$173.20 billion or contributed 76.51% of the total national export value.
Agus delivered, “This figure has exceeded the achievement of manufacturing exports throughout 2020 of US$131.09 billion. Compared to January-October 2021, the export performance of the manufacturing industry in January-October 2022 increased by 20.39%.” The export performance of the manufacturing sector becomes the backbone of national economic growth.
Meanwhile, investment in the manufacturing sector until Q3 2022 is recorded at Rp343.06 trillion, which rose 49.24% compared to the same period in 2021 Rp229.87 trillion.
On the employment aspect, the manufacturing industry sector has recovered in absorbing manpower. The pandemic reduced the number of workers in the industry by 2 million people, from 19.14 million people in 2019 to 17.4 million people in 2020.
“Along with the rise of the manufacturing industry sector from the pandemic impact, there is additional employment of 1.2 million people in 2021 that increase the total workforce in this sector to 18.64 million people. In 2022, there is an addition of 500 thousand workers, resulting in 19.11 million people in the manufacturing industry,” he said.
Agus added the upturn of the manufacturing industry in the country could be seen from the industrial confidence index in November which reach 50.89, indicating expansiveness.
Projected to grow 5.1% in 2023
Along with the expectancy of improving global conditions and the national economy, Agus projects that the manufacturing industry sector to grow by 5.01% in 2022 and higher in 2023 ranging from 5.1% to 5.4%.
“Aligned with this, the export value of the manufacturing industry is estimated to be US$210.38 billion in 2022 and the range of US$225 billion to US$245 billion in 2023. Meanwhile, in terms of investment value, we estimate it will reach Rp439 trillion in 2022, and around Rp450 trillion to Rp470 trillion in 2023,” voiced Agus. The employment number is estimated to reach 19.2 million to 20.2 million people in 2023.
To achieve these targets, the ministry has identified several challenges to be faced in 2023, spanning slowing global economic growth, depreciation of the rupiah exchange rate, instability in export demand, as well as dependence on imports of raw materials and auxiliary raw materials.
Responding to the challenges, the ministry plans to roll out multiple strategic programs, including implementing a restructuring program for textile industry machinery and equipment as well as facilitating free certification for domestic industrial companies.
In addition, the ministry is going to intensify the acceleration of the battery-based electric motorized vehicle program and the development of the technology-based small and medium startup industry in 2023. The ministry has also built the Indonesian Digital Industry Center (PIDI) 4.0 which plays a role in accelerating and accommodating all digital transformation activities in Indonesia.
Continuing its participation in the digital edition of Hannover Messe 2021, Indonesia is entrusted to become the country partner at the Hannover Messe 2023. The ministry will physically participate in the world’s largest industrial technology exhibition event on April 17-21, 2023 in Hannover, Germany.
