Coordinating Minister for Economic Affairs Airlangga Hartarto explained that the national footwear industry is one of the main pillars of Indonesia’s labor-intensive sectors.
This sector is considered to play a strategic role in maintaining economic growth and social stability, both through its contribution to processing and its ability to absorb a large workforce.
The sector’s contribution to the manufacturing industry’s Gross Domestic Product was recorded at 1.2% in the third quarter of 2025. In terms of employment, this sector employed approximately 921,000 workers as of February 2025.
“Amidst global dynamics and uncertainty, the national footwear industry demonstrates strong resilience. In 2024, the export value of the footwear industry grew significantly by 13.13% to reach USD 7.28 billion. This achievement reflects strong and maintained competitiveness in the global market,” said Airlangga.
Investor confidence in this sector continues to grow. Foreign Direct Investment (FDI) realization reached USD 859 million in 2024, and by the first semester of 2025, it had reached USD 803 million.
“This high level of investment interest is in line with the industry’s consistent utilization rate above 80%. This indicates optimal production capacity and positive business prospects,” he said.
However, Airlangga revealed that various challenges, including the implementation of a 19% reciprocal tariff policy in the United States market, still require vigilance.
“Therefore, Indonesia hopes that with the implementation of the IEU-CEPA, this market can continue to open. And of course, this year we are preparing to ensure that the implementation of the IEU-CEPA can be utilized to its full potential,” he said.
To maintain the resilience of the footwear industry, the government has implemented various policy instruments.
These include strengthening the domestic market through Minister of Trade Regulation No. 23 of 2025 concerning the regulation of consumer goods imports; providing fiscal stimulus for workers through the Government-borne Income Tax Article 21 policy based on Minister of Finance Regulation No. 10 of 2025; providing labor-intensive investment credit through Coordinating Ministerial Regulation No. 4 of 2025; and facilitating exports through the optimization of bonded zones and the simplification of export procedures.
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