Indonesia's Business Competition Intensifies, Reaching a Record High in 2023

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Adi Ahdiat 12/06/2024 11:02 WIB

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According to research by the Indonesian Business Competition Supervisory Commission (KPPU) and the Center for Economic and Development Studies (CEDS) at Padjadjaran University (Unpad), the business co

Indonesia's Business Competition Index (2018-2023)

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Indonesia's Business Competition Index (2018-2023)

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Business competition in Indonesia has steadily increased in recent years.

This is evident from the Business Competition Index compiled by the Indonesian Business Competition Supervisory Commission (KPPU) in collaboration with the Center for Economics and Development Studies, Padjadjaran University (CEDS Unpad).

KPPU and CEDS Unpad measure the state of business competition through a survey of stakeholders in 15 business sectors across all Indonesian provinces.

Respondents include provincial-level representatives from the Ministry of Industry/Trade, the Indonesian Chamber of Commerce and Industry (Kadin), Bank Indonesia offices, and local academics.

The dimensions surveyed include industry structure, behavior, and performance; supply and demand factors; and regulations and institutions related to business competition.

The survey results are then analyzed and formulated into a score on a scale of 1-7. A score of 1 indicates very low competition, while a score of 7 indicates very high competition.

In the inaugural measurement of the Business Competition Index in 2018, Indonesia had a score of 4.18.

The figure then fluctuated with an upward trend, reaching 4.91 in 2023, a new record since the start of the measurement.

Despite the upward trend, during the 2018-2023 period, the national business competition index score remained in the "slightly high" category.

Business competition would be classified as "fairly high" if it reached a score of 5.51, and "very high" if the score was at least 6.51.

Based on these findings, CEDS Unpad recommends that the government continue to encourage increased healthy business competition, including by facilitating a non-discriminatory market, not facilitating monopolies, and eliminating various barriers to entry into the industry.

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."

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Indonesia's Business Competition Intensifies, Reaching a Record High in 2023

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