Analysis

Indonesia: Promising production site Using the best opportunities to diversify your own value chain

Dec 4, 2025

As the eighth largest economy in the world, Indonesia is already responsible for almost half of the economic output of the Association of Southeast Asian Nations (ASEAN). According to the latest forecasts, the country, which currently has a population of around 276 million, will grow to become the fourth largest economy in the world by 2050 at the latest. It is therefore hardly surprising that, for some time now, Indonesia has been on the radar of international manufacturers, who want to diversify their supply chains and reduce their dependence on China.

More production sites - less dependence

In the event of a crisis, diversification across several production sites is worth its weight in gold: the COVID-19 pandemic and the resulting surprisingly rapid and prolonged collapse of value chains in China and other countries proved this once again. Our current market report shows why it is time to turn our attention to Indonesia. And why the promising production site in Southeast Asia represents a real alternative to China.

Many things speak for Indonesia - both now and in future

The benefits of (partial) production in Indonesia are obvious: the rapidly growing emerging market not only has an abundance of valuable raw materials, but also a huge labor market. At the same time, personnel costs are still relatively low, especially compared to the already rapidly rising wages in China. In addition, the government is actively seeking foreign investors, among other things by reducing bureaucratic hurdles and offering tax breaks.

Everything you need to know about your future production site Indonesia

Our market report analyzes the economic situation in the most populous country in Southeast Asia and shows the economic potential for the next 30 years based on current forecasts. In particular, it illustrates the opportunities for manufacturers who wish to increase their flexibility and reduce their dependence on the production site China by becoming active in Indonesia.