Investment Boosts Indonesia Logistics


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Manufacturing growth is set to drive logistics opportunities in Indonesia

The Indonesian logistics industry is forecast to grow 15.4 percent in 2020, according to figures from research consultancy Frost & Sullivan.

The positive outlook is likely to encourage further investment in the project cargo and breakbulk sector in the country, as authorities gear up to tackle rising energy imports by expanding domestic production.

Projected growth in the sector will be driven by high domestic consumption, growth in export of manufactured products and improvement in infrastructure investment, according to Frost & Sullivan.

Improved maritime trade connectivity, increases in e-commerce trade and regional trade integration are also set to drive macro-level improvements for the sector and create opportunities for project cargo operators in the country.

Further development of the ASEAN Economic Community is expected to create opportunities via coordinated investment in logistics infrastructure and productivity improvements at ports.

Data from Frost & Sullivan suggest that combined government and private sector spending in public infrastructure is expected to reach around 15 percent of gross domestic product. The manufacturing industry is seen as a driving force for growth with an annual increase of 6.4 percent in 2016. In the near term, air cargo, warehousing, multi-modal movement and E-commerce are also set to show strong growth over 2016.

Photo: Manufacturing growth is set to drive logistics opportunities in Indonesia. Credit: BIS

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