Indonesia’s ranking among manufacturing nations has risen, according to United Nations statistics released yesterday,

The Jakarta Post reports that the UN Industrial Development Organization’sInternational Yearbook of Industrial Statisticsputs Indonesia’s manufacturing sector as a quarter of GDP. The figures consider manufacturing value added.

A spokesperson for UNIDO explained Indonesia’s increase in rankings, passing England and Canada, through its ability to keep factories open during a global downturn.

Indonesia’s overall economy had also been stable compared to its region, with an inflation rate of 4.5 per cent, and seen 25 million people move out of poverty. GDP grew at around 4.7 per cent in 2015.

“In 2010, there were 50 million poor people in the country. Now it is almost half,” Shyam Upadhyaya, a statistician at UNIDO, told the Post.

“If you can maintain these indicators, it could produce higher growth.”

The Wall Street Journal reports that higher-skilled parts of manufacturing, such as chemicals and machinery, are outshining traditional sub-sectors, such as textiles and tobacco.  

“It is a very positive development for innovating or making your industry more efficient,” said Upadhyaya.

The WSJ also reports that Indonesia is likely to see increased competitiveness from its neighbours, such as Vietnam, for foreign investment. More transnational firms are looking to locate parts of their supply chains in the region.

Recently-released survey results in Global Manufacturing Competiveness Index Report by Deloitte noted the increased competitiveness of the so-called MITI-V regional group (Malaysia, India, Thailand, Indonesia and Vietnam). 

SOURCE: Manufacturer’s Monthly