A previous JETRO survey conducted in August and September of last year found that over a third of Japanese companies in Indonesia projected an increase in profits this year and everything shifted after the war began.
Workers assemble truck parts at a factory in East Karawang, West Java. (JP/Seto Wardhana)
Japanese companies operating in Indonesia are expecting declining profit this year as rupiah value swung worse than anticipated while the Middle East conflict introduced more adverse effects that spiked costs in logistics and raw material imports.A survey conducted by Japan External Trade Organization (JETRO) in April and May found that almost half of 205 Japanese manufacturing firms involved in the survey expected a declining profit this year.
Yamada Kenji, JETRO Jakarta senior director, told The Jakarta Post on Friday that “import costs are rising” due to “weak currency” given that the contracts were mainly in United States dollars.
The rupiah value against the greenback had dropped by about 7.5 percent from 16,675 per dollar at the turn of the year to Rp 17,940 on Sunday. The plunge made it Asia’s weakest performing currency this year.
