Indonesia passed Russia and the United Kingdom to become the 10^th largest manufacturing nation, according to a United Nations report.

An employee works on shoes at a home shoe factory in Bogor, Indonesia (Source: www.wsj.com)

Last year Indonesia ranked 12^th. However, the country has overcome difficulties caused by the global downturn and improved thanks to its development policies, said Shyam Upadhyaya, chief statistician at the UN Industrial Development Organisation.

Statistics from the UN showed that Indonesian maufacturing improved since President Joko Widodo’s policies improved productivity and fiscal policy.

The Indonesian president’s policies helped the country reduce inflation and attract more foreign investment.

The industrial sector, now accounting for close to a quarter of Indonesia’s gross domestic product, has lessened the dependence on raw materials such as palm oil and coal.

However, analysts said that the world’s fourth most populous country remains a difficult place to do business.

A lack of infrastructure prevents goods from getting to market efficiently, while low-skilled labour, high costs for raw materials such as steel and overregulation raise operating costs, they said.

Indonesia is also facing competition from regional countries in attracting foreign investment.

(Source: VNA)