Demand For Manufacturing Industry Increases, But Is Inhibited From The Depletion Of Raw Materials

JAKARTA - The outbreak of the corona virus or COVID-19 has resulted in a slowdown in the global manufacturing industry. However, the Indonesian manufacturing industry is still able to expand with the Purchasing Managers Index (PMI) reaching 51.9 in February 2020.

The increase in PMI was due to the transfer of orders from China to Indonesia. However, the opportunity to increase this order cannot be maximized due to the dwindling supply of industrial raw materials.

Coordinating Minister for Economic Affairs Airlangga Hartarto said the Indonesian Manufacturing PMI value which reached 51.9 was the highest in the last 6-7 months. The Indonesian Manufacturing PMI was also higher while other countries experienced a decline.

"Indonesia has good momentum because in February, our Purchasing Manager Index is exactly 51.9. Meanwhile, all other countries, even China, fell to 35.7. So, they have relatively stopped. China, Vietnam, Hong Kong, Japan are all in under 50, "he said, at the Omnibus Law event: Government Breakthroughs for Economic Growth, at the Four Seasons Hotel, Gatot Subroto, Jakarta, Thursday, March 5.

Airlangga revealed that the transfer of orders from China to Indonesia occurred in several sectors, for exports ranging from automotive, electronics, textiles, to footwear.

"This momentum is what the President wants to use which encourages us to prioritize imports and exports. So that the momentum for people to see Indonesia as a big country in Asean, which has the ability to supply chain is used, as the next engine for growth in the region," he explained. .

Meanwhile, General Chairman of the Indonesian Chamber of Commerce and Industry (Kadin), Rosan Roeslani, explained that the increase in orders had occurred at the beginning of the year. But for now the conditions are really tough.

According to Rosan, this is because the majority of industrial raw materials are imported from China, while in that country production activities have stopped.

"The Coordinating Minister for the Economy said that initially there was an increase (orders), but now there is a shock on the supply, demand and production side. These three things are currently experiencing a slowdown. This is what industry friends are currently worrying about. They say the supply of raw materials is average. only one month left, "he explained.

The obstruction of supply and demand from China, said Rosan, had a big effect on Indonesia. Moreover, it is not easy to find a replacement country to obtain the raw materials needed.

"Finding a replacement country is not easy. From the spec it is not easy and they experience a shortage of their goods, from raw goods and auxiliary goods. Our imports are 80 percent of raw materials and auxiliary goods. This must be anticipated in the short, medium term. length, "he said.