This presentation is made as final term for Business Economic Course in Blemba Program - SBM ITB

1. Making Indonesia 4.0 – Manufacture Revitalization
Syndicate 7
1. Bobby Mandala Putra - 29318304
2. Luthfi Muhammad Basith - 29318329
3. Fadila Pratika HS Alimuddin - 29318345
4. Herdiana Wiyono - 29318346

2. 01 Overview & Background
02 Making Indonesia 4.0
03 Making Indonesia 4.0 Priority Sectors
1. Economy Global & Indonesia
2. Industrial 4.0 Concept
3. Impact Manufacturing Sector to Indonesia GDP
4. Why Indonesia Should Revitalize Manufacture Sector to 4th Industrial Revolution
1. Making Indonesia 4.0 Initiative
2. Making Indonesia 4.0 Expected Result
3. High Level Execution Planning
4. Priority Sectors Selected for Making Indonesia 4.0
5. Making Indonesia 4.0 Implementation Roadmap
1. Food & Beverages
2. Textile & Apparel
3. Automotive
4. Chemicals
5. Electronics

3. 1. Economy Global & Indonesia
2. Industrial 4.0 Concept
3. Impact Manufacturing Sector to Indonesia GDP
4. Why Indonesia Should Revitalize Manufacture Sector to 4th Industrial Revolution

4. Global Economy Overview
Indonesia’s Economic Outlook 2019 & Key Economic Challenges – Anton H Gunawan(Chief Economist PT. Bank Mandiri Tbk

5. Indonesia Economy Overview
Indonesia’s Economic Outlook 2019 & Key Economic Challenges – Anton H Gunawan(Chief Economist PT. Bank Mandiri Tbk

6. Proportion of Manufacturing Sector to GDP & Employement
Indonesia’s Economic Outlook 2019 & Key Economic Challenges – Anton H Gunawan(Chief Economist PT. Bank Mandiri Tbk

7. What is Industrial 4.0
https://www2.deloitte.com/content/dam/Deloitte/ch/Documents/manufacturing/ch-en-manufacturing-industry-4-0-24102014.pdf

8. Why Indonesia Revitalize Manufacturing to 4th Industrial Revolution
+34%

9. Why Indonesia Revitalize Manufacturing to 4th Industrial Revolution

10. MAKING INDONESIA 4.0
1. Making Indonesia 4.0 Initiative
2. Making Indonesia 4.0 Expected Result
3. High Level Execution Planning
4. Priority Sectors selected for Making Indonesia 4.0
5. Making Indonesia 4.0 Implementation Roadmap

11. Making Indonesia 4.0 Initiative

12. Making Indonesia 4.0 Expected Result

13. High Level Execution Planning

14. Implementation Road Map

15. Priority Sectors

16. Making Indonesia 4.0 Priority
Sectors
1. Food & Beverages
2. Textile & Apparel
3. Automotive
4. Chemicals
5. Electronics

17. PRIORITY MANUFACTURE SECTORS
This industry is one of the basic human needs. Since it also covers
the scale of medium small industries, the government expects the
greatest contribution and significant development from this industry
1. FOOD AND BEVERAGE
Indonesia is experiencing an extraordinary transition because it has
changed from being only a car production site for export to a large car sales
market due to the increase in gross domestic product (GDP) per capita
3. AUTOMOTIVE
further developments and improvements still need to be made from
this industry. But it must be developed because the petrochemical
industry is one of the upstream sectors that provides raw materials for
almost all downstream sectors, such as the plastics, textiles, paints,
cosmetics to pharmaceutical industries.
5. CHEMICAL
is one of the basic needs. The government hopes to fulfill local demand
and increase exports, with the initiative to develop an Action Plan for
Revitalizing Textile and Apparel industries.
2. TEXTILE AND APPAREL
the weak structure of the Indonesian electronics industry is a cause.
domestic manufactured electronic components are still basic elements
and have not touched parts with high technology content.
4. ELECTRONICS

18. FOOD & BEVERAGE SECTOR – SWOT & Implementation
• By leveling up, the domestic industry
can develop the latest innovations and
technology through partnerships with
developed countries.
• Has growth potential because it is
supported by agricultural resources that
are
abundant and large domestic demand
OPPORTUNITY
• This sector is the main driver of national
industry since it’s potential is quite
large. growth is almost twice that of
national economic growth.
• Growth is driven by the increase in
people's income, accompanied by a
tendency towards consumption patterns
that lead to consumption of processed
food products (ready to eat)
STRENGTH
• Local human resource and local
company’s technology are not
ready for the innovation
progress with well-known
franchise brand.
THREAT
• Industry structure still localized
in small and medium enterprise
WEAKNESS
http://www.kemenperin.go.id/artikel/16979/Industri-Makanan-dan-Minuman-Dorong-Pemerataan-Nasional
• Build the Food & Beverage
industry powerhouse in ASEAN
GOAL
• policy/regulation on
national standard of cleanliness
and quality of restaurant and food
WHAT’S NEXT?

19. TEXTILE & APPAREL SECTOR – SWOT & Implementation
• The government through the ministry of
industry since 2007-2009 has carried
out the Machine / Equipment
Restructuring Program, which aims to
encourage these industry players to
rejuvenate their machinery
OPPORTUNITY
• Historically, this sector is an export
contributor second largest
manufacturing in Indonesia.
• Absorbs large numbers of workers, and
is an industry that is relied on to meet
national clothing needs. This can be
demonstrated through the acquisition of
export surpluses against imports over
the past decade, even when the
economic crisis hit the world
STRENGTHS
• Import, cheaper product from other
countries dominate the local textile &
apparel market
THREAT
• the performance of the national
exports has not yet become a
guarantee that in the future the
industry can still compete, given that
export performance over the past
five years has tended to slow down
due to the complexity of various
factors facing the textile industry.
• the National industry has quite a
number of potential factors that have
the effect of weakening
competitiveness, both internal and
external factors, which need to be
resolved immediately with concrete,
implementative, directed, and
synergic work programs.
WEAKNESS
http://www.kemenperin.go.id/artikel/60/Industri-Tekstil-Dan-Produk-Tekstil-Di-Revitalisasi
• Become leading functional clothing
manufacturers
GOAL
• create policy on reducing carbon
footprint in textile industry
WHAT’S NEXT?

20. AUTOMOTIVE SECTOR – SWOT & Implementation
OPPORTUNITY
• Knowledge transfer from
established automotive company
(Japan & Korea) to its’ local
employees in Indonesia
• Indonesia currently the second
largest automotive exporter in
ASEAN Domestic sales continue
to increase more than 1.2 million
units at its peak, driven by
expansion of domestic needs
• Domestic needs will continue to
grow due to increasing population
middle income
STRENGTH
• The production of vehicles still depends
on imported materials raw material (metal
and chemical) and electronic components
other important.
• There is no Value Chain at upstream on
OEMs and suppliers, only centered on
mid and downstream on OEMs.
• Products that are more in line with the
export market if R&D capabilities in
localized modifications design for export
markets
THREAT
• Trade Specialization Coefficient (TSC) only
positive for vehicles passenger, but for
components still negative
• Local content of vehicle assembly has
reach a high level but sub localization
components are still low, leading to Low
Level of Domestic Components
WEAKNESS
• Become a leading player in the
export of ICE (Internal Combution
Engine) and EV (Electric Vehicle)
GOAL
• National brand for Electric Vehicle
as nation identity
WHAT’S NEXT?

21. ELECTRONIC SECTOR – SWOT & Implementation Plan
• The government attracts leading global
players by providing attractive incentive
packages and developing capabilities in
producing high value-added electronic
components.
• The government is preparing fiscal
incentives called super deductible tax or a
reduction of taxes above 100%. In addition
to encouraging industries to be involved in
vocational education programs, these
incentives can be used for those who are
committed to conducting research to
create innovation.
OPPORTUNITY
• Indonesia is a large potential market and
can become a manufacturing base to
increase the competitiveness of its
products to meet the needs of domestic
and global markets,
STRENGTH
• Invasion of latest technology for
electronic products, especially
from USA and China, since many
electronic company in those
countries have high investment in
their R&D area
THREAT
• Local electronic companies still
limited in Indonesia. Many local
company only act as the
component suppliers.
WEAKNESS
http://kemenperin.go.id/artikel/19352/Peningkatan-Investasi-Industri-Elektronika-Perkuat-Struktur-Manufaktur
• Nurturing highly capable domestic
industry players
GOAL
• Biggest R&D center for electronic in
SEA
WHAT’S NEXT?

22. CHEMICAL SECTOR – SWOT & Implementation Plan
• The government supports the
petrochemical industry by making
plans in the Bintuni area as natural
gas-based petrochemical areas
• Indonesia’s resources have not
been used optimally and have only
been exported. The need for
downstream industries to increase
the value added of domestic raw
materials and sources of
competitiveness. it must be used as
a support for the industrial sector,
not only as trading commodities
OPPORTUNITY
• Indonesia has potential oil and gas
reserves of up to 7.5 billion barrels
and 150 trillion cubic feet and 30
billion tons of coal reserves.
STRENGTH
• The raw material for the petrochemical
industry is still imported and purchased at
high prices, especially naphtha or
processed crude oil.
THREAT
• Indonesia's petrochemical industry lags
behind due to limited access to cheap raw
materials. In fact, access to raw materials is
one way to improve the efficiency of this
industry. If access to raw materials is
limited, the production process becomes
more complicated, long and expensive.
• The growth of the oil and gas-based
petrochemical industry is still influenced by
rising gas prices. Because the gas raw
material forms 70 percent of the production
cost structure in the sector.
WEAKNESS
http://www.kemenperin.go.id/artikel/10778/Industri-Petrokimia-Indonesia-Tertekan-Petrokimia-Thailand
• Developing leading biochemical
manufacturer
GOAL
• Meet domestic needs for biochemical while
increasing exports
WHAT’S NEXT?

23. Thank You
Syndicate 7

24. Governance Implementation High Level Initiative (1)
Ministry of Finance (9&10)
Financial support for every activities in Making Indonesia 4.0 e.g.: R&D&D incentive, CAPEX, Human Resources Development, FDI, import tariff, SME
financing
Ministry of Industry (General)
• Launching Making Indonesia 4.0
• Roadmap details for 5 priority sectors in Making Indonesia 4.0
• Set industry requirement for every national priority
Ministry of Trade (6&10)
• Streamlining between trade agreement and Making Indonesia 4.0 roadmap
Ministry of Economy Coordinator (2&10)
• Streamlining between ministry and organization in its scope of work
• Debottlenecking with other ministry.
Ministry of General Construction and National Housing (2)
• Streamlining between roadmap and infrastructure project with Making Indonesia 4.0 (integrated with national industry zone)
Ministry of Energy and Mineral Resources (1&2&3)
• Streamlining between energy roadmap with national industry zone roadmap.
• Energy and resources productivity improvement program.
Ministry of Marine and Fishery (1&3)
• Productivity improvement program in marine and fishery product – as part of upstream industry initiative
Ministry of Agriculture (1&3)
Productivity improvement program in agriculture, farms, plantation – as part of upstream industry initiative.

25. Planning and Development Body (General)
• Streamlining midterm program & work program with Making Indonesia 4.0 initiative.
• Streamlining Indonesia 2045 Vision with Making Indonesia 4.0
Investment Coordinating Body (6)
• FDI roadshows to assorted investors (100 famous global manufacturer)
Ministry of Research and Higher Education (7&8)
• Redesign National education curriculum to support Making Indonesia 4.0 (e.g. STEAM Education)
• Streamlining national research program
Ministry of Labor (7)
• Streamlining vocational curriculum e.g. for labor training center.
• Upskilling-reskilling labor program inline with skills and competence of Making Indonesia 4.0
Ministry of Cooperation and SME (4)
• Streamlining program in SME empowerment e.g. fintech, e-commerce for SME.
Ministry of Homeland (General)
• Policy Harmonization and communication with local government administration in Indonesia to ensure Making Indonesia initiative translated correctly in
local policy.
Ministry of Communication and Information (5)
• Roadmap streamlining between digital infrastructure and Making Indonesia 4.0 & becoming the executor for the program.
Governance Implementation High Level Initiative (2)