Challenges Facing Indonesia's Industrial Estates

What Challenges Pose for Industrial Estates in Indonesia?

Reporter

July 30, 2026 | 05:39 pm

TEMPO.CO, Jakarta - The occupancy rate in industrial areas remain at 60 to 65 percent, despite continued expansion, according to the chair of the Indonesian Industrial Estate Association, Akhmad Maruf Maulana.

“The expansion is still unreachable due to a number of obstacles,” Maruf said at Pullman Hotel, Jakarta, on Thursday, July 30, 2026.

According to Maruf, Indonesia’s industrial estate’s competitiveness lags behind neighboring countries like Vietnam, Malaysia, and Thailand. Among the reasons for this are lengthy bureaucracy and the lack of synchronization between the central government and local authorities.

In order to accelerate investment realization, Maruf emphasized the importance of discussing the Industrial Estates Bill. He mentioned that he has participated in two hearings with the House of Representatives to discuss the draft law.

He also emphasized that industrial estate entrepreneurs not only rent out land but also build their own factories there. He also ensured that industrial estate investments do not only occur on the island of Java.

Meanwhile, Minister of Industry Agus Gumiwang Kartasasmita ensured that the discussion with business actors is necessary to outline the various challenges faced by entrepreneurs. “This will serve as recommendations for the parliament to complement and refine the draft,”said Agus.

Agus stated that the government and the House of Representatives have commenced the discussion of the draft law, with careful consideration and professionalism towards industrial estate development.

The Golkar Party politician mentioned that industrial estates are not only about providing land but also ensuring a swift process for investors.

Agus hopes that the draft law can be ratified soon, in two or three quarters, without neglecting the finer details.

Read: Will Indonesia’s Economic Growth Exceed 5% in Q2 of 2026?

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