JAKARTA— Partnership between Indonesia and Japan provides ample room for the automotive industry. And this is already understood the Indonesian government to give a guarantee to the small and medium industry sector of automotive components to find outlet for their products.
Director General of Small and Medium Industry Ministry Ms Gati Wibawaningsih explains the automotive sector has become a priority in the partnership. The reason is that Japan— being the largest investor in the country’s automotive industry— requires supplies in a long-term basis. Small-medium industries (SMIs) are guaranteed to supply their products to the Japanese vehicle manufacturers. “At the moment we are in the stage of inventory,” she said.
Indonesia-Japan partnership increasingly finds a clearer directions, thanks to the visit of Prime Minister (PM) of Japan Shinzo Abe in mid-January 2017. The visit was partly an opportunity to drive the Japanese investment in Indonesia. The Ministry of Industry requested that Japanese SMEs co-invest in Indonesia.
SME partnership also is a step to increase competitiveness and quality produced by local manufacturers. Thus, this pattern is able to answer the needs of the automotive industry, especially in the global market.
The partnership also promotes technology transfer and implementation of a variety of training to improve productivity. In case Indonesian manufacturers are developing new products, they no longer need to look for suppliers from Japan as they now can afford from Indonesian fellow car part manufacturers.
Now the government is mapping the car component needs that have not yet been able to be produced by the local industry and the development direction of the motor vehicle industry, both in terms of models and technologies.
Director General of Metal, Machinery, Transportation Equipment, and Electronic Industry Ministry Mr Suryawirawan I Gusti Putu said that the use of local components produced by SMEs will become mandatory. “We are discussing the legal umbrella,” he said.
Law Number 3/2014 states that SMEs in the industrial sector should receive guidance so that competitiveness, contribute significantly in the development of national industries, and contribute to exports. (*)