Jakarta – Industry Minister Airlangga Hartarto has welcomed growth in the manufacturing sector in January after stagnation in the previous month.
The growth was indicated by an increase in the purchasing managers' index (PMI) in February to 50.1 from 49.9 in the previous month.
"It is good news from the manufacturing industry. The growth has made us more optimistic. From the PMI figure, we know that the manufacturing sector is growing. Investment has also grown," he said in a statement on Tuesday.
The PMI, which is released each month, shows the performance of the manufacturing sector. The index is based on questions about production, new demand, employment, inventory and time of distribution.
It was based on a survey completed by managers of 300 companies in various sectors, including the basic metal industry, chemicals, plastics, textile, garments as well as food and beverage products.
An index rate above 50 indicates growth in the manufacturing sector.
Airlangga said the ministry would analyze the decline of the PMI rate in January as the rate was above 50 percent in December and previous months.
"I think it is common for there to be a decline in January," he said, adding that no conclusion could be made from the decline because manufacturing industry activity should monitored over a longer period.
The ministry projects the manufacturing sector to grow 5.4 percent this year. High growth is expected in food and beverage, machinery, textiles and garment, leather industry, footwear, metal products, computers and electronics.
The PMI rate in February was higher than Southeast Asia's PMI rate, which was 49.6, down from 4.9.7 in July 2017. Meanwhile, at the global level, the rate was recorded at 50.6, the lowest since June, 2016. (bbn)