China Quietly Eyes Jakarta

Jakarta, CNBC Indonesia – Industrial areas around Jakarta each possess distinct characteristics. For instance, the Nusantara Bonded Zone (KBN) in the Cakung area is predominantly focused on labor-intensive industries, while other regions are gradually developing according to their specific advantages, such as the Cileungsi industrial area.

“Cileungsi is increasingly connected to the JORR 2 Cijago toll road, which links to Cibitung. If the access roads are well-developed, it has great potential. That’s why many are starting businesses in warehouses or cold storage in the Cileungsi industrial area,” said Rivan Munansa, Director of Industrial & Logistics Services at Colliers Indonesia, to CNBC Indonesia on Tuesday (4/6/2024).

Other areas like the Jakarta Industrial Estate Pulogadung (JIEP) also benefit from their strategic location, making them attractive for businesses to set up supply chain centers or warehouses.

However, there are other negative factors at play, such as the high minimum wage in DKI Jakarta, which stands at Rp5,067,381 per month. It’s no wonder that many are starting to move away from this area to other regions.

“Some are beginning to relocate, but many are still staying because the supply chain is easier here,” Rivan said.

Industrial areas in Jakarta also attract foreign investors to enter the region. Rivan revealed that he has received information indicating that many Chinese manufacturers are seeking land in Indonesia due to the trade war with the United States. Recently, the US has also imposed high tariffs on products from China.

“Lately, it’s been a trend for many Chinese companies to worry about the tariff war between the US and China, so many new companies are expanding from China to seek opportunities in other regions, including exploring prospects in Indonesia,” Rivan said. (Ferry Sandi, CNBC Indonesia)