Manufacturing Sector Believed To Be 'Invulnerable' Amid The Current Crazy COVID-19 Cases

Illustration (Photo: Doc. Indofood)

JAKARTA - Indonesian Center of Reform on Economics (CORE) Economic Observer Yusuf Rendy Manilet assessed that the current surge in COVID-19 cases has the potential to suppress economic performance. According to him, this condition could hamper the momentum of economic recovery which is currently being accelerated by the government.

"As a result of this increase in cases, community activities will certainly be much reduced compared to the previous period, although some productive sectors can still operate with strict health standards and protocols," he said when contacted by VOI, Wednesday, June 23.

He added that most of the business lines would reduce their activities and production capacity. Although this is believed to have happened, Yusuf believes there are still sectors that can survive and even have the opportunity to continue to grow.

"This situation does not seem to have much impact on the manufacturing sector, especially for corporations engaged in the food and beverage industry," he said.

In his assumption, the industry, which is often called food and beverage, is actually quite potential to support the pace of economic growth.

"When other sectors are under pressure, the food and beverage industry can play more of a role to raise the growth rate to a better level," he said.

In addition to manufacturing, the economist also revealed that the agricultural and plantation sectors can be the focus in boosting domestic productivity.

"I think these sectors can still run amid the increase in COVID-19 cases because they have quite strong resilience," he said.

Previously, the Minister of Finance (Menkeu) Sri Mulyani said that the manufacturing sector was included in the growth driver category.

"For the growth driver sector, this is also equally affected by the pandemic and its deep contraction. But they can recover relatively quickly. This can be seen from production activities that continue to increase,” he said some time ago.

Meanwhile, the opposite of the growth driver sector is a slow starter, which means it is affected by the pandemic but the recovery is slow.

In addition, the slow starter when viewed in the picture of an asymmetrical curve between the decline and also the recovery time. Some examples of business lines that fall into this category are trading, construction, transportation, and services.