Ensuring Fairness for Domestic Industries to Face Global Competition

VIVA English – The Indonesian government continues to push for the development of domestic industries as part of efforts to improve the welfare of its people.

Fair competition with global industries is crucial for the development of the local industry. This fairness protects companies from unfair competition and provides opportunities for growth and entry into international markets.

Odo R.M Manuhutu, the Deputy for Tourism and Creative Economy of the Coordinating Ministry for Maritime Affairs and Investment, stated that the government is always encouraging producers to continuously improve the quality of their products through research budgets and investment in human resources.

“Research and development is a critical key to improving the quality of domestic products in the international industry. Indonesia must be able to create new and innovative products needed by society,” he said on FMB9 discussion, Monday 8^th May 2023.

Andi Rizaldi, the Expert Staff of the Minister for Business Climate and Investment of the Ministry of Industry of the Republic of Indonesia, added that the government has implemented the Accelerated Development Program for National Goods and Services Providers (P3DN) as an effort to advance the domestic industry.

The Ministry of Industry has set rules for calculating the Domestic Component Level (TKDN) which apply to all manufacturers who market their products in Indonesia. TKDN calculation is the main consideration of the ministry and government institutions in procurement or auctions.

“This is expected to encourage investors to invest in the upstream sector. The government also provides incentives, such as tax holidays and tax allowances,” said Rizaldi.

Danny Harjono, the Secretary General of the Association of Indonesian Information Technology and Brand Industry (AITIMI), stated that the industry basically only wants to be treated equally with foreign companies.

One of the things that is often considered unfair is the inequality in TKDN requirements for local and foreign companies. Foreign brands can meet TKDN requirements in a different way than local companies.

This issue must be resolved quickly to maintain business continuity and the development of the domestic industry,” said Harjono.