The Indonesian Ministry of Industry (Kemenperin) has announced that the pulp and paper sector plays a vital role in driving the country's economic growth. According to statements from Minister of Industry Agus Gumiwang Kartasasmita, this sector contributed 3.73% to the non-oil GDP of Indonesia in 2025.
Data shows that pulp exports reached $3.60 billion, while paperboard exports amounted to $4.57 billion. This sector employs over 280,000 direct workers, in addition to 1.2 million indirect workers across 113 companies operating in this field.
Event Details
Reports indicate that Indonesia ranks seventh globally in pulp production and sixth in paperboard production, reflecting its strong position in the global market. The minister emphasized the importance of this sector as one of the cornerstones of national industry, highlighting its positive impact on the Indonesian economy.
Putu Juli Ardika, the acting Director General of Agricultural Industry, added that the pulp and paper sector has the potential to enhance economic growth by offering diverse products such as pulp, industrial paperboard, tissues, specialty paperboard, and rayon, thereby meeting the needs of various industrial sectors.
Background & Context
Historically, the pulp and paper industry in Indonesia has witnessed significant development, with rising demand for paper products due to the increased use of paper packaging. The shift towards more sustainable packaging materials reflects the global trend towards a green economy.
Forecasts suggest that the flexible packaging market has surpassed a value of $270 billion, and it is expected to grow at a rate of 5-6% annually until 2032, opening new horizons for the pulp and paper industry in Indonesia.
Impact & Consequences
Despite the challenges facing the industry, such as raw material shortages and global regulatory measures like the European Forest Law, the sector shows positive development. The government is focusing on promoting green industry principles and a circular economy, enhancing the sector's competitiveness.
The Ministry of Industry is developing new strategies to boost competitiveness, including improving the supply chain for recycled paper, offering financial incentives, and fostering innovations in alternative raw materials.
Regional Significance
Indonesia is one of the largest exporters of paper products, which may impact the Arab market by providing sustainable alternatives for packaging. Additionally, cooperation between Arab countries and Indonesia in this sector can contribute to achieving sustainable development goals.
In conclusion, the pulp and paper sector in Indonesia serves as a model for how to enhance the national economy through innovation and sustainability, opening new avenues for regional and international cooperation.