‘ As the largest
economy in ASEAN, Indonesia contributes around 40 % in terms of population and GDP, creating a new paradigm of ASEAN as GREATER
INDONESIA.
I
T
Insight
Asia
Mr. Adhi Lukman Chairman of Indonesia Food and Beverage Association( GAPMMI)
Indonesian F & B industry entering a new era
he Food & Beverage industry in Indonesia is entering a new phase after facing a rather tough year in 2015. Global economic slowdown, slumping of commodity prices, weakening purchasing power added with transitional stage in the government – consolidation and coordination of policies and regulations as well as new budget to roll out only at the end of 2015 created a challenging landscape for the industry. Within the first semester of 2015, industrial growth was predominantly contributed by soaring prices. Fortunately, coming to the second semester of 2015, we saw better economic fundamental and the progress of government budget movement drove further growth and most importantly, volume now was the dominating factor to contribute to the industry growth.
In the beginning of 2016, we are looking at better growth; volume is increasing, despite a slight bump between ends of February towards March 2016. The Q1 – 2016 growth reached 7.54 % and the growth quality surpassed that of 2015, mainly because at this time, volume is driving the growth instead of soaring price. Hence the Food & Beverage industry still managed to contribute 31 % of the GDP( non-Oil & Gas industry sectors).
Special Message
Indonesia Food and Beverage Association( GAPMMI)
Investment record also showed a positive turnout in Q1 – 2016 compared to year 2015, whereby Foreign Direct Investment reached USD 1.5 billion and Domestic Direct Investment reached IDR 24.5 trillion. Investment in Food & Beverage industry is expected to surpass its record in 2015.
Year 2016, Indonesia is entering the AEC era, which only means huge potential for the industry in Indonesia to tap into the ASEAN market. As the largest economy in ASEAN, Indonesia contributes around 40 % in terms of population and GDP, creating a new paradigm of ASEAN as GREATER INDONESIA. This is the best opportunity for Indonesia to seize and to make the ASEAN Single Market and Production Base be happened. Taking ASEAN as GREATER INDONESIA,
business professionals in Indonesia should be more confident in winning the opportunity around ASEAN and to call ASEAN as home turf.
Certainly, there is always a new challenge for the Food and Beverage industry year to year. As the Food Safety Standard and Regulations are becoming stricter, everyone in the industry must anticipate and follow the development. Making use of local resources and product innovation are key to winning the market, while Indonesia still depends a whole lot on imports of raw materials and ingredients. Innovation is supremely important, especially in how to benefit from all global resources: ingredients, additives and processing technology. Indonesia is betting on Global Value Chain to give value-added points in processing chain and to supply finished products to the global market.
Next challenge is the government regulation which is expected to support the industry in increasing competitiveness. Modern marketing system also demands support in all products distribution activities. Products will not make it out there in the market, without good touch of marketing and human resources support.
‘ As the largest
economy in ASEAN, Indonesia contributes around 40 % in terms of population and GDP, creating a new paradigm of ASEAN as GREATER
INDONESIA.
,
In view of all those challenges, GAPMMI is addressing it by strengthening the relationship and collaboration among stakeholders, including partnering the government in supporting economic growth and fostering competitiveness. GAPMMI actively contributes to the government policy-making process to keep a business-friendly environment while maintaining balance in the society, especially in keeping vigilant on food safety and health of the public. We are also active in socializing new regulations, coaching the industry to meet the standard, enhancing our members’ capability and more. Beyond Indonesia, GAPMMI is also committed in the international scenario, particularly in the ASEAN. This year, GAPMMI is entrusted to be the President of AFBA( ASEAN Food and Beverage Alliance), whereby Regulation and Standard Harmonization in ASEAN is becoming AFBA’ s main focus in reducing non-tariff barriers.
Interm of export food industry, Indonesia is expecting a healthy trade balance for processed food, steadily improving from year to year. In 2014(-) USD951 million, in 2015(-) USD 276 million and up to April 2016, we are at(-) USD 28 million, while export value reached USD 1.9 billion.
In regards to Fi Asia, it’ s a good platform for GAPMMI and our members to explore new products, new food additives, new ingredients, process innovation and more. Fi Asia supports the food and beverage industry in product development through innovation. The event proves to be a solid channel for the industry to connect with the suppliers, for professionals to network and share ideas on product development and discover global product trends.
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