Industry Minister: Investment competition now between regions, not countries
Jakarta (ANTARA) — Minister of Industry Agus Gumiwang Kartasasmita has said that competition to attract global investment no longer takes place between countries, but between industrial zones, meaning the competitiveness of each estate is now the decisive factor in drawing investment into Indonesia.
According to Agus, global companies looking to build factories no longer compare Indonesia with other countries in general; instead they compare a specific industrial estate in Indonesia with an estate in a rival country.
“What they compare is not Indonesia against Vietnam. What they compare is an estate in Central Java against an estate in Binh Duong,” Agus said when opening the National Working Meeting of the Industrial Estates Association (HKI) in Jakarta on Thursday.
He said this shift shows that the unit of global economic competition has moved from the country level to the estate level.
For this reason, he believes decisions taken by industrial estate managers will largely determine the competitiveness of the national industry.
Amid fragmenting international trade, supply chain disruption and geopolitical tensions, Agus sees a major opportunity for Indonesia to strengthen its position as one of the world’s manufacturing production bases.
“Companies that are today relocating production from one country to another are not waiting for Indonesia. They are comparing us with Vietnam, Thailand, India and Mexico, and they are doing so in a matter of months, not years,” he said.
According to Agus, industrial estates are no longer sufficient acting merely as providers of land or utilities; they must transform into industrial ecosystems capable of accelerating investment realisation.
He emphasised that the main value investors seek is speed in turning investment commitments into production activity, as well as certainty in business processes.
Consequently, Agus called on industrial estates to transform into investment enablers capable of integrating supply chains, innovation centres, human resource development and the transition towards green industry.
He also highlighted three factors that will determine the future competitiveness of industrial estates: fast and certain licensing, adequate infrastructure, and energy availability, particularly renewable energy.
He said the supply of clean energy is no longer merely an environmental issue but has become a market requirement, as many buyers from Europe, for instance, have begun asking about the energy sources used in the production process.
“If an estate cannot answer that question, it risks losing tenants — not because of our regulations, but because of the regulations of export destination countries,” Agus said.