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Ministry says industrial expansion sturdy despite pandemic
Manufacturing has been the largest contributor to GDP since 2010, but its proportion relative to other sectors has been declining.
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Employees work at a factory making tofu from soybeans in Surabaya, East Java, on Jan. 20, 2022. (AFP/Juni Kriswanto)
T
he Industry Ministry said on Thursday that Indonesia’s manufacturing sector has continued expanding over the past two years despite the challenges of COVID-19.
Industry Ministry spokesman Febri Hendri Antoni Arif said that increases in the absolute value of manufacturing output, investment and employment, among other indicators, demonstrated this expansion.
Manufacturing output reached Rp 2.95 quadrillion (US$205.8 billion) last year, an increase of 6.7 percent from 2020, according to Statistics Indonesia (BPS) data based on current prices, as cited by the ministry. The sector contributed the largest amount to GDP since 2010.
Manufacturing investments reached Rp 325.4 trillion last year, up 19 percent from 2020 and up 50.7 percent from 2019, added the ministry.
“As previously stated by the industry minister, the rapid realization of investment in the industrial sector shows the high level of trust in Indonesia as the right place for business. This is also an important opportunity for Indonesia's post-pandemic economic strengthening," said Febri, referring to Industry Minister Agus Gumiwang Kartasasmita.
The ministry added that manufacturing employment rose 7 percent year-on-year (yoy) to 18.7 million workers last year.
However, he acknowledged there was a drop in factory output due to lower demand as the world entered an economic recession during the pandemic.
