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Indonesia calls on manufacturers anew to invest in AI, digitalisation

Indonesia has renewed its call on local manufacturers to invest in digitalisation, particularly in the field of artificial intelligence as it continues to be on the lookout for investments which can ramp up its manufacturing sector.

According to his published statement, Taufiek Bawazier, Director General of the Metal, Machineries, Transportation and Electronic Industries at Indonesia’s Ministry of Industry said that manufacturers should consider beefing up their portfolio with new investments in innovative technology. This, he said, will allow manufacturers better leverage when competing with foreign companies, particularly in the Southeast Asian market.

In line with this initiative, the Ministry of Industry urged state-owned train manufacturer PT INKA to assist in boosting innovation by creating investments in artificial intelligence and other digitalisation technologies. Bawazier stressed that innovative investments, coupled with strong support from the government will allow for more room for improvement in two areas of the economy: investment and exports.

Last month, Indonesia pushed for the use of digital technology to foster the productivity of its manufacturing sector. According to Gati Wibawaningsih, the Director-General of the Small, Medium and Miscellaneous Industries of the Ministry of Industry, technological innovations like cloud computing and data sharing need to be utilised by companies including small businesses. This modern mindset, she said, has to be adopted as the world grapples with the economic effects of the COVID-19 pandemic and the subsequent new normal that has stirred changes in business models and operations.

In giving investments a boost, the Ministry has amplified efforts in seeking projects that will be able to produce substitutes to raw materials that the state are currently importing abroad. In terms of exports, the Ministry added that the country aims to scale up productivity levels to cater to increasing exports demand.

In a news story earlier reported by OpenGov Asia, the Ministry explained that to provide support to investors, the Indonesian government continues to put policies in place which can help speed up business license processes. Such efforts constitute attempts to create a more conducive business climate for investors.

One of the primary industries the Ministry is targeting to scale up is the semiconductor industry which it believes will further strengthen the electronics industry as a whole.

According to the Making Indonesia 4.0 roadmap released in 2018, the electronics industry is one the sectors prioritized to be developed by the Indonesian government as it eyes a more robust economic growth fueled by job creation and strong exports.

Indonesia anticipates that the implementation of the roadmap will help improve the economy by 1% to 2%. Meanwhile, the manufacturing sector is expected to make up at least 21% of the country’s gross domestic product by 2030.

Aside from electronics, the five top sectors Indonesia is trying to improve on are food and drinks, automotive, textile and chemicals.

In the same press release, government-owned PT Inka has announced that it has delivered to the Philippines a new set of locomotives on 12 December via the Tanjung Perak port in East Java, Indonesia. The Philippine National Railways (PNR) said that the train manufacturer has dispatched a total of three locomotives and 15 cars to the country. The dispatch came after the PNR inked a deal with PT Inka in Manila on 28 May 2018 for the purchase of cars and locomotives amounting to PHP 1.4 billion (USD 26 million). PT Inka President and Director Budi Noviantoro, who managed the consignment of the vehicles, said that the delivery marks the first time that PT Inka has shipped locomotives other than trains to the Philippines.

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