Kadin: Some Businesses Expand, but Many Remain Under Pressure

The Indonesian Chamber of Commerce and Industry (Kadin) has acknowledged that a number of business sectors are in an expansion phase, as stated by Coordinating Minister for Economic Affairs Airlangga Hartarto. Kadin Deputy Chairman for Organisation, Communication, and Regional Empowerment Erwin Aksa explained that the picture of a weakening business world does not apply evenly across all sectors. “Amid global challenges and a slowdown in several labour-intensive industries, there are sectors showing increased investment, production capacity, and demand for land in industrial estates,” Erwin said when contacted on Tuesday (30/6). He cited sectors that are still relatively growing, including the mineral downstream industry, data centres and the digital economy, logistics and warehousing, energy including renewable energy, industries related to the electric vehicle (EV) supply chain, and several food and beverage industries still supported by domestic consumption. “In several industrial estates, demand for land from investors in these sectors is indeed still quite good,” Erwin revealed. However, he noted that this expansion does not yet fully reflect the condition of the business world as a whole. At the same time, labour-intensive sectors such as textiles, garments, footwear, and parts of the furniture industry are still facing pressure due to weakening export demand, rising production costs, and increasingly fierce import competition. “Therefore, Kadin views indicators such as increased industrial estate occupancy as a positive signal that should be appreciated, but it needs to be seen more comprehensively,” he said. Erwin stressed that it is more important to ensure that investment growth can create broad employment opportunities, strengthen linkages with local industries, and promote equitable economic growth. He also urged the government to continue paying attention to sectors still under pressure so that the recovery can take place more evenly across all business sectors. Earlier, Coordinating Minister for Economic Affairs Airlangga Hartarto assessed that various business sectors are still expanding, supported by investment realisation in the first quarter of 2026 that exceeded the government’s target. Airlangga said business actors will naturally increase production capacity when they see opportunities to boost sales. “I believe entrepreneurs, when there is an opportunity to increase production, will naturally increase it, especially since entrepreneurs want to leverage, so higher sales are always expected by business actors,” Airlangga said as quoted from Antara on Monday (29/6). Airlangga cited several economic zones and industrial estates that are still showing expansion trends, including plans to expand the Gresik Special Economic Zone (KEK) in East Java to accommodate high investment interest and support the development of an integrated industrial and port ecosystem.