Industrial estates need a new measure of success
Indonesia must stop selling cheap land and labor—and start building high-performing, sustainable industrial ecosystems that modern global investors actually want.
Indonesia's industrial landscape is expanding rapidly, with 179 industrial estates now sprawling across nearly 100,000 hectares and providing jobs for over 2.35 million people. However, simply measuring success by land area, occupancy rates, capital inflows, and headcount is no longer sufficient in today's global market. Modern investors demand more – dependable energy, low-carbon operations, water security, skilled labor, environmental compliance, reliable supply chains, and community support.
Regulatory measures are in place, with Government Regulation No. 20/2024 modernizing industrial zoning and Industry Ministerial Regulation No. 26/2025 setting formal standards and accreditation. The upcoming Industrial Estate Bill presents a crucial opportunity to redefine national expectations for industrial estates.
The solution lies in evolving the existing accreditation process into a comprehensive Industrial Estate Performance and Sustainability Framework. This should involve regular, outcome-based reviews tied to practical metrics such as energy efficiency, water consumption, emissions targets, circular waste systems, worker safety, fair labor practices, grievance mechanisms, and local economic integration. These indicators truly reflect the modern standards for a commercially viable industrial estate.
Written by urgent.news from The Jakarta Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
