Manufacturing PMI September 2024 Still Contracting, Minister Of Industry: Need Regulatory Support

JAKARTA - The Purchasing Manager of the Indonesian manufacturing's Index' (PMI) in September 2024 increased slightly to 49.2 from the previous 48.9 in August. The Ministry of Industry (Kemenperin) stated that appropriate regulations were needed to encourage PMI to enter the expansionary level.

Minister of Industry (Menperin) Agus Gumiwang Kartasasmita said, to make PMI re-expansive, appropriate regulations from various ministries are needed.

"In order to be more expansive, the industrial sector needs the right regulatory support from various ministries/agencies. So, the domestic industry can host in its own country," said the Minister of Industry in a written statement, Tuesday, October 1.

The policies needed by the manufacturing sector, said Agus, include the revision of the Minister of Trade Nomoe 8 of 2024, the Draft Government Regulation (RPP) on Natural Gas for Domestic Needs and the Regulation of the Minister of Finance regarding Anti-Dumping Import Duty (BMAD) for imported ceramic tiles and Imported cloth Safeguard Measure Import Duty (BMTP).

"Therefore, policies to control the entry of goods into Indonesia are very necessary. Currently, we are continuing to strive to create demand for domestic products because the demand is there, but the market is also flooded with imported products," he said.

Agus said, if it was observed more deeply, the decline in new orders that emerged as a result of the Indonesian manufacturing PMI survey in September 2024 was also shown by the September 2024 edition of the Industrial Trust Index (IKI).

The decline in orders only occurred in other processing industry sub-sectors where IKI contracted. This sub-sector experienced a decrease in orders, both outside and within the country.

Other industrial sub-sectors that also experienced IKI contractions in new orders were the tobacco processing industry, textiles, finished clothing, wood, paper, chemicals, computers and electronics as well as repair services.

The Purchasing Manager's Index (PMI) of Indonesian manufacturing is still contracting below 50, which is at the level of 49.2 in September 2024, although the manufacturing activity index has experienced a slight increase from the previous month of 48.9.

Based on the latest S&P Global report, Tuesday, October 1, 2024, despite the increase, Indonesia's manufacturing PMI has shown a marginal decline and has been slightly slower in the last 3 months.

S&P Global Market Intelligence Economist Paul Smith said that the Indonesian manufacturing sector was still sluggish due to the global macroeconomic condition that was sluggish in September.

"The fastest on external sales in nearly two years from the latest reports is very prominent in statistics," Paul said in his official statement, Tuesday, October 1.