Minister Of Industry Agus Reveals Manufacturing Performance Doesn't Always Depend On Global Markets

Minister of Industry Agus Gumiwang Kartasasmita. (Photo: Theresia Agatha/VOI)

JAKARTA - Minister of Industry Agus Gumiwang Kartasasmita said the performance of the national manufacturing industry does not always depend on the dynamics of the global market, but is also influenced by internal policies.

"Although the global market is very important for the growth of the national industry, it means that not only the performance of the manufacturing industry in the country is related to the global market. Exports are increasing, why is PMI going down," said Agus Gumiwang as quoted by ANTARA, Wednesday, September 18.

This was said by the Minister of Industry in response to the difference between Indonesia's trade balance which was in surplus in August 2024 and the contraction of the manufacturing Purchasing Manager's Index (PMI) in the same period.

He said there needs to be an increase in collaboration between all parties that can provide growth space for the national industry, such as providing incentives, as well as restrictions on cheap imported products that erode the competitiveness of the domestic industry.

"We see that the challenge faced by the manufacturing industry is imports. Imports can be imported illegally, that is also a separate problem, or legal imports resulting from our regulations that are not pro-industrial. Legal goods are cheap, surely our industry cannot," he said.

The Central Statistics Agency (BPS) recorded that the total value of non-oil and gas exports in August 2024 to the 13 destination countries reached 16.22 billion US dollars, an increase of 9.26 percent compared to July 2024 of 14.85 billion US dollars.

Meanwhile, when compared to the same month in 2023, the total value of non-oil and gas exports was recorded to have increased by 6.34 percent.

Meanwhile, in the same period, S&P Global Market Intelligence released PMI manufacturing Indonesia to contract to 48.9 points or down 0.4 points on a monthly basis.

S&P Global Market Intelligence Economist Paul Smith said the decline in Indonesia's manufacturing sector's economy in August resulted in the company responding by reducing employees.

However, according to him, the contraction is believed to only last a while.