The Indonesian Food and Beverage Association Chairman Adhi Siswaja Lukman said on Thursday that the association expects to see 8 to 10 percent growth of sales in 2012. Data revealed that from January to September 2011, the industry saw 7.29 percent of sales growth from 2010 to Rp71 trillion from Rp65 trillion.
He also stated that foreign direct investment in the industry has grown to Rp 7 trillion in 2011. On the contrary, local direct investment had significantly dropped from 16.4 trillion in 2010 to Rp 6.2 trillion in 2011.
"Some of the reasons are the law uncertainty, such as indecisive fuel pricing which affects our distribution costs and the inability to come up with fix price decisions, as well as the high interest rate for loans, which is not supporting the industry," he said.
Adhi hopes to see better local direct investment margin and restriction of imports through the adoption of the government's tax holiday and allowance policies, as well as the recently established Cikarang Dry Port which serve as the appointed Integrated Customs Services Zone as part of the International trading line.
A net importer of food and beverages, data from the Central Statistic Agency recorded US$ 4.9 billion worth of imports to Indonesia until October 2011, 73.74 percent growing from US$3.8 billion in 2010. Exports, on the otherhand, only slightly increased to US$ 3.5 billion in 2011 from US$3.4 billion in the same period of 2010.
"What's shocking is that 24 percent of our food and beverage imports, reaching US$56.6 million, are coming from Malaysia, and though imports from Thailand only slightly decreased due to the flood, other Asean countries like Singapore and Philippines are making Indonesia as main target country for export. Even Vietnam see up to 200 percent of elevated exports to Indonesia," said the association's secretary general Franky Sibarani.
Imports from Malaysia had grown by 60 percent from 2010. Cheaper packaging cost, translates to cheaper product prices, according to Franky, becomes another reason why Malaysian products are swarming the Indonesian market.
The second biggest exporter of food and beverages to Indonesia is China with 13.9 percent quota, followed by Singapore at 4.4 percent. (eaz)
