Govt urges expansion of intermediate manufacturing sector

Jakarta (ANTARA) - Industry Minister Muhammad Sarmuji called for accelerating the development of Indonesia’s intermediate manufacturing sector to reinforce national supply chains and enhance the commercial value of domestic commodities, officials said Wednesday.

Speaking at the Indonesia Food Innovation Awards in Tangerang, Sarmuji emphasized that expanding intermediate processing enables domestic enterprises to move beyond basic consumer retail and integrate deeper into corporate supply chains.

"Intermediate products enable food businesses to take a broader role in the value chain—not only selling final products to consumers, but also supplying needs for other businesses and industries," Sarmuji said.

Highlighting innovations including sago- and cassava-based noodles, algae extracts, and fish-collagen processing, Sarmuji noted that utilizing agricultural and marine by-products supports circular economy goals while creating high-value opportunities for small and medium-sized enterprises.

The food and beverage sector remains a cornerstone of Indonesia’s non-oil processing economy.

In the first half of 2026, the sector grew 6.77 percent, contributing 41.86 percent to non-oil manufacturing GDP.

Realized investment hit 47.74 trillion rupiah ($2.64 billion), with domestic capital accounting for 59 percent.

Between January and August 2026, food and beverage exports reached $34.65 billion against $9.7 billion in imports, generating a trade surplus of nearly $25 billion and employing approximately 6.9 million workers.

Sarmuji noted that national manufacturing momentum remains strong, with Indonesia’s Purchasing Managers' Index (PMI) rising to 54.0 in October 2026, outpacing regional peers including Japan, Vietnam, China, and South Korea.

Beyond food processing, the minister advocated leveraging local biodiversity for pharmaceutical raw materials to reduce import reliance, while utilizing Indonesian culinary exports as tools for soft diplomacy abroad.

Translator: Ahmad Muzdaffar Fauzan, Yashinta Difa
Editor: Aditya Eko Sigit Wicaksono
Copyright © ANTARA 2026