ALFI: 5.29 Percent Q2 Growth Reflects Solid Supply Chain

The Indonesian Logistics and Forwarders Association (ALFI) assesses that the national economic growth in the second quarter of 2026, which reached 5.29 percent year-on-year (yoy), reflects solid supply chain resilience.

“The 5.29 percent growth in the second quarter is an indication that the foundation of our domestic demand and supply chain resilience is far more solid than the market anticipated,” said Yukki Nugrahawan Hanafi, Chairman of the Advisory Board of ALFI’s Central Executive Board, in a statement in Jakarta on Friday.

Furthermore, Yukki underscored that public consumption continued to support growth in the second quarter of 2026, contributing 53.32 percent to GDP, demonstrating resilient domestic demand.

He also highlighted the recovery in manufacturing industry activity at the start of the third quarter of 2026 as a momentum to strengthen the prospects for sustained growth. The S&P Global Indonesia Manufacturing Purchasing Managers’ Index (PMI) rose to 50.2 in July 2026 from 46.9 in June, returning to expansionary territory after four months of contraction, with the output index surging from 44.4 to 50.4.

“The PMI returning to expansionary mode is a leading indicator for the business world. The increase in production volume is expected to translate into higher cargo volume within the next four to eight weeks. This must be maintained,” said Yukki.

He also stressed the importance of boosting exports so that economic growth in 2026 can approach the target of 5.4-6 percent. He advocated for three policy priorities in the second half of 2026: accelerating the digitalisation of the National Logistics Ecosystem (NLE) to make the logistics sector more efficient, diversifying export markets through the utilisation of multilateral networks and active trade agreements, and strengthening port and industrial estate connectivity, including optimising logistics hubs outside Java.

“For economic growth in 2026 to approach the government’s target of 5.4-6 percent, positive catalysts are needed, including well-targeted government spending, accelerated productive investment, and maintained domestic purchasing power,” said Yukki.