While purchasing power in Indonesia is modest, processed food consumption continues to grow. The Indonesian food processing and packaging equipment market remains a bright spot in the economy. Total imports for 2007 was $350 million and are projected to grow by three to five percent in 2009.
Indonesia's food processing sector is quite dynamic. The country boasts the largest and fastest growing instant noodle industry in the world. Joint ventures, licensed production and locally owned companies already exist in the areas of snack foods, sweets, biscuits and bakery items, juices, dairy, canned fruits and vegetables, meat, and poultry products.
Best sales prospect include machinery for filling and closing containers, machinery for packing and wrapping, cutting machines, presses, crushers and sorting machinery.
Within these sectors, U.S. suppliers are already relatively strong and should strengthen their market position with respect to other countries. There are no import duties on food processing machinery, but there is a value-added tax (VAT) of 10 percent.
U.S. products, particularly technologically advanced high-volume machinery, are considered to be of excellent quality. The Indonesian market for food processing and packaging equipment is quite open; there are no major import restrictions. Main competitor countries include Germany, New Zealand, Denmark, Italy, China, Taiwan and Japan.