Industry players are seeking the government’s favor to protect domestic manufacturers amid the influx of food trays illegally imported from China that has led to the closure of many local producing companies. 

PT Bintang Matrix Indonesia, a local company engaged in the production of automotive components and food trays, has since the beginning of 2024 tried to seize new opportunities following the downturn of the automotive sector, starting the production of food trays.

However, the company now has to face a harsh reality as it has had to halt food tray production due to competition from much cheaper imported products.

“We were excited because the automotive sector was down, and we saw an opportunity in the food industry. This gave us new energy to diversify,” one of the company’s owners, Robert Susanto, said on August 13, 2025.

However, he added, demand dropped drastically after Idul Fitri and at the end of May, there were completely no orders for the company’s food trays.

“With no demand, the factory had to halt operations. The machines that were once running are now idle. Worse still, 30 workers involved in the food tray production process had to be laid off,” he said.

The main issue for PT Bintang is related to pricing as it could not compete with imported goods. “Our prices were very cheap, but still couldn’t compete with imported products,” he said, while citing that these imported goods come at much lower prices because they don’t pay the proper entry fees.

He, therefore, expected the government to provide more protection and give more room for domestic industries to grow. “In the absence of strict regulation, we will struggle to survive,” Robert said.

“We’d like to support government programs, including the free nutritious meal (MBG) program and help boost the national economy. But we need support so that local businesses can survive and grow,” he added.

Fierce competition from imports

PT Rizqi Moro Rejo, a company focusing on the production of food trays, once had great dreams of contributing to Indonesia’s economy by supporting government programs aimed at strengthening domestic production. However, intense competition with imported goods flooding the market has almost forced the factory to close, laying off nearly all its workforce and reducing production capacity with just three people remaining to run the show.

Based in Solo, Central Java, PT Rizqi Moro Rejo decided to expand to Jakarta, specifically to Cikarang, with high hopes. The company bought its own printing machines, recruited employees, and made all the preparations to produce food trays that meet quality standards, with an initial investment of around Rp9-10 billion (US$594,000 - 660,000).

However, just two weeks after starting production, the harsh reality hit them. “Suddenly, imported goods flooded the market and we clould not compete as we could only produce a few,” Zulfi Hendri, the factory owner, said.

Although the selling price of its products was only slightly higher than imported goods – imported ones sold for Rp45,000, while its products cost Rp9,000 – the taxes it paid became a major obstacle.

“We lost to imported products because we have to pay taxes and other fees. Even though our products are only slightly more expensive, the taxes we pay make ours even less competitive,” Zulfi said.

Although there were still raw materials available, he added, the factory was forced to reduce production capacity and could only run at a slow pace operated by only three people, including Zulfi.

He echoed Robert’s statement that the main problem faced is the policy which allows foreign products to enter without adequate protection for domestic ones.

“We have tried our best, but without government’s protection, it is very difficult for us to survive,” he said.

“We hope the government can provide more protection for local industries. We’ve invested heavily, and many employees depend on us,” he added.

PT Rizqi Moro Rejo is determined to continue to survive, waiting for better days. Zulfi hopes that one day, his factory will resume full operation, providing jobs and supporting the local economy. But for that to happen, he believes the government needs to provide greater support for domestic industries.

Priority

Tumiran, a Gadjah Mada University (UGM) professor, said Indonesia must focus on strengthening domestic industries and reducing dependence on imports. He highlighted the great potential for local industries to grow if the government changes its approach.

He questioned the import policy of goods that could apparently be produced locally, such as household items.

“If we can produce airplanes and ships in Indonesia, why can’t we make simple products like plates?” he said.

He emphasized the economic benefits of supporting local industries, which would not only reduce dependence on imports but also create much-needed jobs.

“If we import a container of plates, priced around Rp50,000 to 55,000 per unit, it may only create jobs for five people. But local production of the same item could employ hundreds,” he cited, while urging the government to support Micro, Small, and Medium Enterprises (MSMEs) in producing these goods.

He stressed that local production would support a circular economy, where money and resources circulate within the country.