China’s BYD and Vietnam’s VinFast plan to establish factories in Indonesia, potentially boosting the country’s industrial zones.
BYD, the Chinese electric vehicle (EV) giant, and Vietnam’s VinFast have announced plans to build factories in Indonesia. BYD is set to invest over USD 1 billion (SGD 1.36 billion) in Subang Smartpolitan Industrial Park. VinFast has also committed USD 1.2 billion (SGD 1.63 billion) to Indonesia.
Rivan Munansa, Head of Industrial & Logistics Services at Colliers Indonesia, believes these investments will significantly benefit the national industrial sector amid the US-China tariff war. “It will positively impact the industrial zones sector because many investors will come to Indonesia,” he said.
Rivan urged the Indonesian government to simplify investment processes to seize this opportunity. “Our government should support and provide a good investment climate by reducing bureaucracy,” he added.
To ensure a conducive investment environment amid global economic uncertainty, Rivan emphasized the need for swift decision-making by the government to help companies start operations quickly.
Sanny Iskandar, Chairman of the Indonesian Industrial Estate Association (HKI), noted that BYD and VinFast’s investments would strengthen local industrial zones. The assembly industries have broad supply chains, and BYD and VinFast’s presence will attract Tier 1 and Tier 2 supply chain vendors from China and Vietnam.
Read More: VinFast’s $1.2 Billion Investment Boosts Indonesia’s Electric Vehicle Industry
Sanny called on the government to proactively provide incentives and facilities to smoothen the investment process. “Indonesia has a large domestic market, but the choice of location depends on supportive incentives and legal certainty,” he concluded.
BYD and VinFast’s investments will significantly impact Indonesia’s industrial landscape. For Singaporeans and international visitors, this development indicates a thriving automotive manufacturing hub with growing opportunities for business and trade partnerships.
BYD and VinFast are set to build factories in Indonesia, with investments totaling over USD 2.2 billion (SGD 2.99 billion). Their entry is expected to bolster the national industrial sector and attract a broad network of Tier 1 and Tier 2 vendors. Experts emphasize the importance of simplifying investment processes and offering incentives to facilitate this massive investment opportunity.
Source: Bisnis (2024)
