PUBLICATIONS & REPORTS

Contents Introduction

The Indonesian automotive industry has been characterized as a classic case of an infant industry that has failed to grow despite the government’s attempts to stimulate the industry’s growth through various protective measures. Under the recently liberalized trade regime, the industry is facing increasing pressure from international competition. The purpose of this paper is to examine the recent trends in exports, imports and plant efficiency in the automotive industry. One of the main findings of the analysis is that the recently liberalized trade regime has positively affected the exports of Indonesia’s automotive industry. The study also finds that imports from the ASEAN region are increasing and this has positively affected productivity in some groups of plants including locally and foreign-owned plants.