Indonesia's manufacturing sector faces decline, urgent reforms needed for growth.
Indonesia's manufacturing industry is not growing as fast as the overall economy, so it needs a boost. By analyzing the gap between actual and potential output, researchers found that the industry fell below its potential in 2020-2021. To fix this, the government should focus on controlling inflation in the short term and making long-term changes like increasing labor force participation and investing in technology. This will help the industry grow and stay competitive.