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Indonesia Logistics – Fast Track or Derail?

Logistics remains a nascent sector in Indonesia and has traditionally been held back by factors relating to infrastructure and a sometimes challenging regulatory environment. Indonesia’s sheer scale and archipelagic nature is such that delivering goods to far flung corners of the country remains time-consuming and costly and for these reasons, logistics costs are high. However, Indonesia has a robust manufacturing base, consumer goods groups continue to grow and e-commerce firms are expanding rapidly. Historically, modern warehouses were often delivered on a build-to-suit basis but we expect an active leasing market to emerge as the market matures. This paper examines the state of the Indonesian logistics market including its challenges and opportunities; identifies the easiest route for investors; and recommends the next steps to transform Indonesia into a world class global logistics hub.

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