Manufacturing Industry Growth Decelerates

TEMPO.CO, Jakarta - The central statistics agency, Statistics Indonesia or BPS, noted slowing production growths in large and medium manufacturing industries over the last two years. In Q3/2019, this production group only recorded a growth of 4.35 percent (yoy), down from 2018's 5.04 percent and 2017's 5.46 percent.

"Right now the economy is not easy, almost all countries are experiencing a weakened economy. The trade war, the volatile commodity prices—all of those will affect [growth]," BPS chief Suhariyanto said during a press conference in Jakarta, October 1, 2019.

Suhariyanto said five sectors experienced the biggest declines in Q3: metal goods, not machinery, and equipment (-22.95 percent); rubber, rubber and plastic goods (-16.63 percent), machinery and equipment (-12.75 percent), tobacco processing (-12.73 percent); and automotive, trailers and semi-trailers (-12.32 percent).

However, large and medium industrial manufacturing growth in Q3 was higher than Q2/2019. The quarterly growth rate was 5.13 percent, up from Q2's -1.91 percent.            

Sectors that experienced production growth were non-metal excavation (14.15 percent) and other transportation equipment (11.25 percent). Production declines occurred in the tobacco processing industry (13 percent) and the machinery and equipment industry (6.01 percent).

Fajar Pebrianto