2The Performance of Indonesia’s Food and Beverages Industry

This paper explains about the performance of Indonesia’s Food and Beverages Industry (FB Industry). It is analyzed by industrial concentration, cost of input, value added, efficiency and labour productivity. The data used was large and medium scale industries that is classified by Indonesia economic activities classification (KBLI) which is based on International Standard Industrial of All Economic Activities (ISIC) published by Indonesia’s Burreau of Statistics, for years 2000 – 2005. It is found that the ratio concentration of FB industry is decreasing as the number of firms increasing. The cost of input is increasing, where as 90 % of cost is allocated for raw material. It is also shown that over 50 % of raw marerial is imported. The industry value added is increasing and it caused an improvement in industry efficiency that shows an increasing. It has other meaning that the output value of industry increasing. The labour productivity shows an increasing during the yeras, eventhough the labour cost shows an increasing. It is concluded that Indonesia’s Food and beverages industry shows a good performance. However, it still face an important barrier since most of the raw material need to be imported