The Processing Industry Has Failed to Become a National Economic Driver in the Last Decade

The manufacturing industry has been the largest contributor to the national economy over the past 10 years. However, this sector has not been able to become a driver of Indonesia's Gross Domestic Product (GDP).

According to data from the Central Statistics Agency (BPS), the GDP of the manufacturing industry reached Rp3.59 quadrillion in 2022. This value accounts for 18.34% of the total national GDP of Rp19.58 quadrillion. This proportion is lower than the previous year's 19.25% of the national GDP.

Despite having the largest share, the manufacturing industry has not been able to become a driver of the national economy. This is evident from the industry's growth, which has consistently been below national economic growth over the past decade, as shown in the graph.

Last year, the manufacturing industry grew by only 4.98% year-on-year. This figure is lower than the national GDP growth of 5.31%.

Most manufacturing sub-sectors recorded growth last year, except for the sub-sectors of furniture; non-metallic mineral products; tobacco processing; and rubber and rubber products.

The following is a list of the growth of the manufacturing industry by sub-sector in 2022:

* Manufacturing Industry: 4.89%
* Basic Metals: 14.80%
* Machinery and Equipment: 11.37%
* Transportation Equipment: 10.67%
* Leather, Leather Goods and Footwear: 9.36%
* Textiles and Garments: 9.34%
* Metal Goods; Computers, Electronic, Optical Goods; and Electrical Equipment: 6.71%
* Other Manufacturing; Repair and Installation Services of Machinery and Equipment: 6.08%
* Food and Beverages: 4.90%
* Paper and Paper Products; Printing and Reproduction of Recording Media: 3.73%
* Coal and Oil Refining: 3.72%
* Chemicals, Pharmaceuticals and Traditional Medicines: 0.69%
* Wood, Wood Products and Cork and Woven Products from Bamboo, Rattan and the Like: 0.59%
* Furniture: -1.99%
* Non-Metallic Mineral Products: -2.00%
* Tobacco Processing: -2.34%
* Rubber, Rubber Products and Plastics: -4.10%