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Indonesia 4.0: Food industry tech and innovation to play ‘huge’ role incountry’s dream to be world’s fourth largest economyAccording to Indonesian Food and Beverage Industry Association (GAPMMI)Chairman Adhi Lukman, the F&B industry will be a key driver of the country’seconomic development, especially in terms of processed food and beverageproducts.“Indonesia’s aim to become the fourth largest world economy is missionpossible, [especially] with Indonesia 4.0,” he said while addressing theaudience during the Halal Perspective in ASEAN Country panel held as part ofthe recent Fi Asia Thailand 2019 show in Bangkok.“There exists a huge opportunity for the food industry here – Indonesia hasthe world’s fourth largest population of 261.9 million as of June 2017, and agrowth rate of some 1.34%, and 49.1% of expenditure here is attributed tofood.”According to data from the International Monetary Fund (IMF) andPriceWaterhouseCoopers (PWC), Indonesia is projected to become the fourthlargest economy (based on GDP) in the world by 2050, behind China, India andthe United States.“Indonesia’s GDP grew 5.17% year-on-year in 2018, [and] the average monthlyexpenditures by both urban and rural consumers were dominated by food (49.5%in total) – commodity-wise, processed foods and beverages took the largestslice of the pie at 33.98%,” said Lukman.The Indonesian food industry also demonstrated a respectable growth of 7.91%in 2018, contributing 6.25% overall to the country’s total GDP. This total GDPcontribution percentage has been continuously on the rise since 2014 when itwas recorded as 5.32%.“F&B exports are also very important – In 2018 Indonesia’s top exportdestination was China (13%), followed by India (13%) and the United States(11%),” said Lukman.“When it comes to semi-processed and processed foods, based on trade balancedata from Statistics Indonesia and the Ministry of Trade, there is huge exportpotential to be explored with Thailand from within the ASEAN region, as wellas China and Australia within the Asia Pacific region.“Innovation is a must – at present the food industry is still dependent onimported raw or semi-processed materials, [and it is important to look at]added value production.”#### Indonesia 4.0Within the ‘Making Indonesia 4.0’ roadmap launched by Indonesian PrimeMinister Joko Widodo last year, the food and beverage industry was listed asone of the top five sectors that the government will place high priority ondeveloping, along with the textile and garments, automotive, electronics andchemicals industries.Multiple initiatives have been put into place as part of this roadmap, forexample the Indonesian Food Innovation Centre (IFIC) which aims to act as ahub to help in innovating Indonesia’s food value chains.“The IFIC also wants to act as an enabler, as a bridge between the governmentand the multiple food industry related organisations such as the standardsagency, training and educational agencies, R&D agencies and universities, andmore throughout the food value chain such as food manufacturers,” saidLukman.“[The] industry must be smart to anticipate the changes in economic models andconsumer demands – companies especially will need to adapt in this ‘change ordie’ situation.“[Here], disruptive technology, innovation, human capital, and governmentregulations [will] all play an important role.”#### Halal industry opportunitiesWith the Muslim population worldwide standing at 2.14 billion people as of2018, Lukman added that the opportunities to be found within the halalindustry were also very significant, both in Asia and worldwide.“Indonesia has one of the largest Muslim populations in Asia at 233.38 millionpeople making up 88% of the population – this is second only to India 274.26million, but which makes up only 20% of the total population,” he said.“[Looking at this], the halal food industry is expected to hit US$1.9tn by2023 according to the Global Islamic Economy Report, [and] there are manyopportunities as yet untapped. “For example, in the United States, Muslims are spending US$16bn a year onkosher products are halal products are not available – there are 86 kosherproducts for every one halal product on supermarket shelves. Wouldn’t theseconsumers prefer to buy halal products instead?”