The Indonesian Chamber of Commerce and Industry (Kadin) has revealed\nthat the business sector is holding back on investment expansion and\nopting for a survival strategy due to dual pressures from domestic and\nglobal factors. The statement was made by Kadin\u2019s Deputy Chairman for\nFiscal and Monetary Policy, Kamrussamad, during the INDEF Mid-Year\nReview National Seminar in Jakarta on Thursday (25\/6\/2026).<\/p>\n
Kamrussamad explained that rolling blackouts remain a serious problem\nfor domestic industries, including small and medium enterprises (UMKM)\nwhose raw materials require 24-hour processing but are disrupted by a\nlack of electricity supply and minimal backup generators. On the global\nfront, geopolitical conflicts over the past two to three years have\ndisrupted trade flows and increased production costs, particularly for\nindustries reliant on imported raw materials paid for in foreign\ncurrency while their products are sold in rupiah.<\/p>\n
He noted that these conditions are forcing a number of companies to\nprepare options for furloughing employees with a maximum payment of 50\npercent of their base salary without formal termination. From the 187\nbusiness associations gathered under Kadin, he observed that the\nsituation in the real sector is not favourable, exacerbated by a global\ninterest rate hike moving towards a high-rate regime in the last one to\ntwo months.<\/p>\n
Kamrussamad also highlighted that volatile food inflation has already\nexceeded 6 percent, a stark contrast to the government\u2019s narrative of\ncontrolled inflation. He argued that Indonesia is experiencing\n\u2018premature deindustrialisation\u2019 because the national economic structure\nover the past two decades has not been oriented towards strengthening\nmanufacturing, instead relying on domestic consumption. He contrasted\nthis with Malaysia\u2019s development of the semiconductor industry or\nSingapore\u2019s focus on hospitality, both of which are reflected in the\ncomposition of companies listed on their respective stock exchanges.<\/p>\n
Regarding energy subsidies, Kamrussamad noted that the 2026 state\nbudget allocation for energy subsidies and compensation reached Rp402.4\ntrillion, yet the supporting ecosystem for clean energy transition is\nstill considered weak. This is reflected in the carbon market, which was\nlaunched in 2024 but has yet to see significant transaction growth. He\nurged that the use of green energy become part of the business world\u2019s\ninvestment style, citing the example of a business group that\nsuccessfully penetrated the European export market after its smelter\nadopted clean energy.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/kadin-business-sector-just-surviving-amid-global-pressures-1782541210", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }