Industrial Confidence Index Increases To 52.32, Enters Expansive Phase

Industrial illustration (Doc. Antara)

JAKARTA - The Ministry of Industry (Kemenperin) released the Industrial Trust Index (IKI) for the February 2023 period.

The Ministry of Industry said that IKI in February 2023 remained expansionary with an achievement of 52.32 when compared to the previous month which was only 51.54.

"IKI in February is still in an expansive phase or an increase of 0.78 compared to January 2023," said Ministry of Industry spokesman Febri Hendri Antoni Arif in Jakarta, Tuesday, February 28.

The increase in IKI value is supported by an increase in the number of sub-sectors experiencing expansion. There are 16 industrial sub-sectors that experience expansion with 87.7 percent share of GDP for the non-oil and gas processing industry.

Of the 16 sub-sectors, four of them experienced phase changes from contraction to expansion. The four sub-sectors include the Printing and Record Reproduction (KBLI 18), Rubber, Rubber and Plastic Goods (KBLI 22), Non-Mealth Galiran Goods (KBLI 23) and Computers, as well as Electronic and Optical Goods (KBLI 26).

In general, said Febri, the majority of industrial companies answered that the condition of their business activities was stable in February 2023 compared to the previous month of 47.1 percent and 29 percent answered.

"Meanwhile, those who answered decreased by 23.9 percent, decreased by two percent compared to January 2023," he said.

The increase in IKI value in February 2023 occurred in all IKI-forming variables and was mainly still dominated by domestic orders.

New Order Variables increased from 51.14 to 52.81, Production variables increased from 50.35 to 51.37, and Product Supply variables decreased from 54.34 in January 2023 to 52.51 in February 2023.

Nevertheless, there are seven industrial sub-sectors that are still at the contraction level in February 2023. The seven industrial sub-sectors have a share proportion of GDP for the non-oil and gas processing industry of 12.3 percent.

Febri said, in general, in February 2023 business actors saw that business conditions over the next six months were more optimistic than the view of business conditions last month.

The majority of 64.3 percent of business actors expressed optimism for industrial business conditions over the next six months. This figure is an increase from the previous month of 62.3 percent.

"The majority of respondents who answered are optimistic in expressing their confidence in market conditions will improve and trust because of the central government's better policies," explained Febri.

Then, along with the increasing optimism of business actors, the percentage of pessimism of business actors decreased from 13.6 percent in January 2023 to 10.8 percent in February 2023.

"Finally, 24.9 percent of business actors stated that their business conditions were stable for the next six months. This figure increased slightly compared to the previous month which was 24.1 percent," added Febri.