Indonesia’s competitiveness falls 13 places
Minister says it is difficult to maintain ranking as country plunges to 40th from 27th in 2024
JAKARTA, Indonesia (MNTV) – Indonesia’s manufacturing industry grew by 4.94% this year but this growth was colored with structural challenges that caused the country’s global competitiveness to lag behind, reports Tempo.
The World Competitiveness Ranking survey released by the International Institute for Management Development (IMD) shows Indonesia’s competitiveness fell to 40th from 27th in 2024. “The previous achievements are difficult to maintain,” said Agus Gumiwang, Minister of Industry.
IMD measures a country’s global competitiveness through four main pillars: economic performance, government efficiency, business efficiency, and infrastructure. Agus mentioned that Indonesia’s previous ranking was supported by policy reforms and bureaucratic improvements.
In 2025, Agus Gumiwang noted a decline in the Health and Environment subsector to 63rd place and the institutional framework to 51st place, as well as other supporting subsectors.
This year, the minister said Indonesia records positive performance in the business efficiency subsector, especially in the labor market framework, where Indonesia is ranked 10th. “This shows a contrasting situation. The business environment’s ranking is already quite good and respectable, but the quality of other main foundations still needs to be pursued,” said the minister.
Agus Gumiwang also explained the investment achievement from the manufacturing sector in the past year. He mentioned that the figure reached 568.4 trillion rupiah ($34.3 billion), equivalent to 40.72% of the total national investment.
According to Agus, this figure created 19.44 million job absorptions, accounting for 13.41% of the total national job absorptions.
Indonesia’s competitiveness rankings in last 5 years
2020: 40th place
2021: 37th place
2022: 44th place
2023: 34th place
2024: 27th place
2025: 40th place
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