Land prices for industrial use in Indonesia show significant regional differences:
– Core Economic Areas (West Java, around Jakarta): Land prices range from approximately $140 to $230 per square meter, suitable for high value-added industries.
– Developing Regions (Central Java): Land prices are around $60 to $120 per square meter, making it the preferred choice for labor-intensive projects.
– Outer Island Industrial Zones (Sumatra, Kalimantan): Prices range from about $80 to $150 per square meter, and additional infrastructure costs may be required.
Foreign investors can hold land use rights through a local company (PT PMA), with the actual maximum duration being 80 years.
II. Factory Costs
– Self-built Factories: Construction costs vary depending on materials and design. Steel structure costs are approximately $200 to $400 per square meter, while concrete structures are around $300 to $500 per square meter. Compared to China, the costs are higher. Local construction efficiency is relatively low, and construction periods are generally extended by 20-30% compared to expectations.
– Leasing/Purchasing Factory Buildings in Industrial Parks: Monthly rent is about $2 to $6 per square meter (varies depending on the region, lease term, and factory specifications).
III. Labor Costs
– West Java/Banten Area: The statutory minimum wage ranges from $260 to $400.
– Central Java: Relatively lower, with a minimum monthly wage standard of approximately $130 to $240.
IV. Energy and Logistics Costs
V. Tax Policy Incentives
1. Free Trade Zone Privileges (for Export-oriented Enterprises)
– If a company’s products are 100% exported, it can locate in government-designated free trade industrial zones or apply for free trade qualifications, and enjoy the following benefits:
– Tariff Exemption: Import of raw materials and new equipment is duty-free.
– Value-added Tax (VAT) Relief: No 12% VAT is required for the purchase of raw materials locally.
2. Corporate Income Tax Exemption (Core Incentives for Manufacturing)
– The standard corporate income tax rate is 22%.
– Enterprises in special economic zones (such as KITB) are entitled to tax-free periods, as follows:
– According to the Indonesian Ministry of Finance’s **2024 Tax Law Amendment, manufacturing enterprises in special economic zones can enjoy corporate income tax exemptions ranging from 5 to 20 years, depending on the amount of investment.
V. The China-Indonesia Twin Parks·Batang (KITB) Wanda Industrial Park Helps Enterprises to Quickly Settle Down
The China-Indonesia Twin Parks·Batang (KITB) Wanda Industrial Park project is located in the Batang Industrial City (KITB) in Semarang, Central Java, Indonesia, adjacent to the highway and Semarang Port, with a unique geographical advantage.
The park offers flexible factory lease terms and reasonable rent, and follows the principles of sustainable development, with green development as the concept. It actively introduces advanced environmental protection technologies and facilities, and is committed to creating a modern and intelligent new industrial base.
Based on the needs of Chinese small and medium-sized enterprises to go to Indonesia, the park provides “one-stop” services for investors, helping Chinese enterprises to quickly settle down in Indonesia, making your overseas journey time-saving, cost-effective, and worry-free!
