Jakarta (ANTARA) – The Ministry of Industry stated that the improvement in Indonesia’s manufacturing Purchasing Managers’ Index (PMI) in May 2026 is evidence of the national industry’s resilience amid global challenges. S&P Global data shows Indonesia’s manufacturing PMI stood at 50.0 in May, up from 49.1 in contractionary territory in April. In a statement on Tuesday, 2 June 2026, Industry Minister Agus Gumiwang Kartasasmita said the PMI improvement reflects the industrial sector’s resilience in maintaining production continuity amid global economic dynamics. “Industry players are taking preemptive measures by strengthening raw material inventories to ensure production remains uninterrupted over the coming months,” he said. According to him, the PMI uptick in May needs to be viewed comprehensively. A key driver behind the index’s improvement was manufacturers increasing their stockpiles to mitigate potential supply disruptions and rising costs of imported raw materials. “Raw materials and intermediate goods currently account for about 70 percent of Indonesia’s imports, capital goods like machinery and equipment make up around 15 percent, while the remainder consists of consumer goods,” he said. He further explained that while manufacturers previously maintained an average of three months’ worth of raw material inventory, many companies have now doubled their reserves to sustain operations for the next six months. This move is deemed vital, particularly for sectors that rely on continuous manufacturing. In addition to maintaining production, increasing raw material stocks also serves as a strategic hedge against future price increases. The minister noted that manufacturers cannot immediately raise their selling prices because the market takes time to adapt. The Ministry of Industry recorded that the manufacturing PMI achievement in May also aligned with the positive performance in the Industrial Confidence Index (IKI), which climbed to 53.56 from 51.75 in April. This rise reflects growing optimism among manufacturers regarding business conditions and steadily improving domestic demand. “The rise in both the PMI and IKI in May signals that the domestic manufacturing sector remains highly resilient. Industries are maintaining their production levels while proactively hedging against risks from external factors,” he asserted. Based on the S&P Global report, the rise in Indonesia’s manufacturing PMI in May was also fueled by an acceleration in new orders, driven primarily by the domestic market. However, production cost pressures and raw material supply disruptions remain key challenges for the manufacturing sector. The Ministry of Industry affirmed that it will continue to strengthen coordination with industry players to ensure a steady supply of raw materials, maintain domestic production continuity, and boost the competitiveness of Indonesian manufacturing amid a volatile global economy. Translator: Ahmad Muzdaffar, Raka AdjiEditor: Azis KurmalaCopyright © ANTARA 2026 Link to the article: https://en.antaranews.com/news/417659/rise-in-indonesias-manufacturing-pmi-reflects-resilience-ministry

The German government has reached a deal with Franco-German tank maker KNDS and its owners to acquire 40 per cent of the company, paving the way for a long-awaited IPO. A spokesperson for Chancellor Friedrich Merz said that Berlin would seek to buy the stake in the maker of the Leopard 2 tank to “safeguard the interests” of Germany after months of wrangling. Citing the war in Ukraine and the ongoing Russian threat to Europe, the person said that the geopolitical situation “necessitates expanding the capabilities of the defence industry”. Berlin will acquire its stake from the German families who own half of KNDS. Paris, which also owns 50 per cent of the tank maker, is expected to reduce its stake to 40 per cent to match Germany’s stake, according to people familiar with the discussions. The remaining 20 per cent is expected to be floated. In parallel, Germany and France also announced that they had settled on a governance pact and strategy for the tank maker, which aimed at “enhancing Franco-German co-operation”.  The agreement on the future of Europe’s biggest tank maker comes after a string of failed joint Franco-German weapons development programmes, including a plan to jointly build a next-generation fighter jet, that have damaged a bilateral relationship seen as crucial to efforts to promote European sovereignty.  KNDS now aims to file its official documentation to kick off the IPO process in the coming days, according to people familiar with the matter, with a view to holding the first day of trading before mid-July. While KNDS had previously hoped to achieve a market capitalisation between €15bn and €20bn, the slide in defence stocks has put downward pressure on the valuation, according to people familiar with discussions. While the valuation discussed is focused around €15bn with numbers as low as €12bn, talks are ongoing and the final figure will depend on investor demand, they said. The difficult negotiations between the countries also reflect Berlin’s wary attitude towards Paris, with German officials anxious to ensure that they had an equal share in what they saw as a key strategic asset.   The deal follows months of talks with the German families who own 50 per cent of KNDS. Berlin suffered disagreements with the families and the tank maker’s leadership over pricing and also the voting rights it should secure in exchange for its stake. Merz’s spokesperson said on Monday that the price paid by the government would be based on the market value, without giving details about how that figure would be calculated. KNDS chief executive Jean-Paul Alary said the agreement — which still requires sign-off from the Bundestag’s powerful budget committee — confirmed the “strategic importance” of the company for “Europe’s defence capability, industrial base and technological sovereignty”. It also recognised the “legitimate strategic and security interests” of the group’s state stakeholders, while preserving the autonomy of the group’s management, he said.   The deal comes as Germany takes an increasingly assertive approach to defence industrial production and capacity as it plans to unleash more than €750bn in military spending by the end of 2030. German economy minister Katherina Reiche said the government stake would secure “key technologies, industrial value creation and jobs in Germany”. The agreement will allow the German family shareholders, most of whom are descended from industrialists who bought into a forerunner company in the late 19th and early 20th centuries, to exit the business and profit from a boom in defence stocks since Russia’s 2022 full-scale invasion of Ukraine.  The German government, which also owns an 11 per cent stake in the aerospace group Airbus and 25.1 per cent of German sensor and radar maker Hensoldt, intends to reduce the size of its stake at a later date, while maintaining the same governance rights within the company as France, Merz’s spokesperson said. France and Germany said in a joint statement that they had agreed on “the strategy and governance”, and the aim of maintaining equal shareholding levels.  “The shared ambition of France and Germany is clear: to develop KNDS into a leading European and global defence company serving the French and German armed forces,” they said. Written by Laura Pitel, Anne-Sylvaine Chassany, Leila Abboud, Sylvia Pfeifer, additional reporting by Aysun Bora Copyright The Financial Times Limited 2026. All rights reserved. Link to the article: https://www.ft.com/content/1bec7e7a-3a37-48b1-899a-2090ebfe7f67?syn-25a6b1a6=1