Indonesia Construction Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 284.17 Billion |
| Market Size (2029) | USD 407.87 Billion |
| CAGR (2024 - 2029) | 7.50 % |
| Market Concentration | Medium |
Major Players.webp)
*Disclaimer: Major Players sorted in no particular order |
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Indonesia Construction Market Size
The Indonesia Construction Market size is estimated at USD 284.17 billion in 2024, and is expected to reach USD 407.87 billion by 2029, growing at a CAGR of 7.5% during the forecast period (2024-2029).
The Indonesian government has significantly funded infrastructure projects such as roads, bridges, airports, seaports, and railways. These projects are part of a national effort to improve connectivity, reduce logistical costs, and increase economic development across the board. Indonesia welcomes foreign investment in the construction sector, with companies worldwide participating in several projects. The diversity and competitiveness of the market are brought to bear through partnerships and collaboration among domestic and foreign companies.
As of December 2023, to tackle one of Indonesia's most important growth challenges, the high cost and underdeveloped revenue intermediation, the US and Indonesian governments joined forces on a USD 649 million investment from the Millennium Challenge Corporation. Indonesia's Infrastructure and Finance Compact will address enhancing infrastructure financing, particularly transport and logistics infrastructure, and growing access to finance for micro, small, and medium-sized enterprises.
Due to population growth, urbanization, and an expanding middle class, demand for residential property is rising in urban and rural areas. The result has been a surge in the construction of houses. In 2023, the Indonesian government announced plans to boost the real estate market by implementing the value-added tax and the IDR 4 million (USD 252) administration fee for low-income home buyers.
Indonesia Construction Market Trends
Growth of Infrastructural Plans Drives the Construction Market In Indonesia
As demand for such services continues to rise in Indonesia, more data centers will soon be built there. Indonesia is on track to overtake Singapore as Southeast Asia's second-largest public cloud market. The country is already home to major cloud providers like Google Cloud, AWS, Microsoft Azure, and Alibaba Cloud.
Equinix is currently trying to jump on board in Indonesia. In order to establish its International Business Exchange (IBX) data center in Jakarta, the tech company is expected to invest USD 74 million. The expansion is anticipated to make it possible for businesses in Indonesia and beyond to use its reliable platform to link and connect the basic infrastructure that underpins their operations.
The Indonesian government also allocated a budget of IDR 422.7 trillion (USD 27.01 billion) from the 2024 state budget, its largest infrastructure budget in five years, to work on infrastructure projects. This represented a growth rate of 5.8% over the 2023 infrastructure budget realization forecast, amounting to IDR 399.6 billion (USD 25.54 billion).
Increased Involvement of State-owned Enterprises (SOEs) Driving the Market
More than 50% of construction roles are awarded to established Indonesian state-owned enterprises (SOEs) and companies such as Wijaya Karya, Adhi Karya Waskita Karya, and Pembangunan Perumahan. These SOEs are involved in major infrastructure projects across the market, such as the Patimban Deep-Sea Port in West Java or work relating to the Jakarta Mass Rapid Transit System.
Under the National Medium-Term Development Plan (2020-2024 RPJMN), the government plans to invest IDR 6 quadrillion (USD 412 billion) in developing transport, industrial, energy, and housing infrastructure projects by 2024.
Indonesia Incorporated Day was held on January 24, 2024, at Nusa Dua in Bali, Indonesia. The event was co-organized by the Indonesian Ministry of Foreign Affairs (MoFAD), the Ministry of State of Enterprises (SOE), and PT BNI. The objective of the Indonesia Incorporated Day was to promote cooperation between the government, private sector, SOEs, and micro, small, and medium enterprises to achieve the goal of Indonesia Going Global.
Indonesia Construction Industry Overview
The Indonesian construction market is expected to be competitive and more cohesive with the presence of major local and international players. Key players in the market are Chiyoda Corp., Wijaya Karya, Toyo Construction Co. Ltd, TBEA Co. Ltd, Hyundai Engineering & Construction Co. Ltd, and many others. The Indonesian construction market is expected to present opportunities for growth during the forecast period, which is anticipated to drive market competition. The market is fragmented, as many new entrants are focusing on bagging projects to strengthen their positions among the market's key players.
Indonesia Construction Market Leaders
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Chiyoda Corp.
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Wijaya Karya
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Toyo Construction Co. Ltd
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TBEA Co. Ltd
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Hyundai Engineering & Construction Co. Ltd
*Disclaimer: Major Players sorted in no particular order
Indonesia Construction Market News
December 2023: Masdar entered into contracts with PLN, Indonesia’s state-owned public utility company, to propel significant development initiatives for Southeast Asia’s largest floating solar power plant (SPS) and investigate possibilities in green hydrogen. This collaboration resulted in the initiation of the world’s largest floating solar power station (SPS) project, the 145MW “Cirata” (Cirata reservoir), in West Java, Indonesia, which commenced operations in December 2023.
December 2023: Gravel secured funding from NEA to bolster Indonesia’s thriving construction industry.
Indonesia Construction Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS AND DYNAMICS
4.1 Current Economic and Construction Market Scenario
4.2 Technological Innovations in the Construction Sector
4.3 Impact of Government Regulations and Initiatives on the Industry
4.4 Impact of COVID-19 on the market
5. MARKET DYNAMICS
5.1 Drivers
5.1.1 Government Policies and Regulatory Support
5.1.2 Tourism and Hospitality Sector Growth
5.2 Restraints
5.2.1 Financial and Funding Challenges
5.3 Opportunities
5.3.1 Affordable Housing Development
5.4 Porter's Five Forces Analysis
5.4.1 Bargaining Power of Suppliers
5.4.2 Bargaining Power of Consumers/Buyers
5.4.3 Threat of New Entrants
5.4.4 Threat of Substitute Products
5.4.5 Intensity of Competitive Rivalry
6. MARKET SEGMENTATION
6.1 By Sector
6.1.1 Commercial Construction
6.1.2 Residential Construction
6.1.3 Industrial Construction
6.1.4 Infrastructure (Transportation) Construction
6.1.5 Energy and Utilities Construction
7. COMPETITIVE LANDSCAPE
7.1 Overview (Market Concentration and Major Players)
7.2 Company Profiles
7.2.1 Chiyoda Corp.
7.2.2 Toyo Construction Co. Ltd
7.2.3 TBEA Co. Ltd
7.2.4 Hyundai Engineering & Construction Co. Ltd
7.2.5 Samsung C&T and Corporation
7.2.6 McConnell Dowell
7.2.7 Adhi Karya
7.2.8 PT PP (Persero)
7.2.9 Wijaya Karya
7.2.10 Waskita Karya
7.2.11 PT Jaya Konstruksi Manggala Pratama*
- *List Not Exhaustive
8. FUTURE OF THE CONSTRUCTION SECTOR IN INDONESIA
9. APPENDIX
Indonesia Construction Industry Segmentation
Construction includes any on-site physical work that involves erecting a structure, cladding, external finish, formwork, fixtures, installing services, and unloading equipment, supplies, etc. A complete background analysis of the Indonesian construction market, including the assessment of the economy and contribution of sectors in the economy, market overview, market size estimation for key segments, and emerging trends in the market segments, market dynamics, and geographical trends, and COVID-19 impact, is covered in the report.
The Indonesian construction market is segmented by sector (commercial, residential, industrial, infrastructure (transportation) construction, and energy and utilities construction). The report offers market size and forecasts for all the above segments in value (USD).
| By Sector | |
| Commercial Construction | |
| Residential Construction | |
| Industrial Construction | |
| Infrastructure (Transportation) Construction | |
| Energy and Utilities Construction |
Indonesia Construction Market Research FAQs
How big is the Indonesia Construction Market?
The Indonesia Construction Market size is expected to reach USD 284.17 billion in 2024 and grow at a CAGR of 7.5% to reach USD 407.87 billion by 2029.
What is the current Indonesia Construction Market size?
In 2024, the Indonesia Construction Market size is expected to reach USD 284.17 billion.
Who are the key players in Indonesia Construction Market?
Chiyoda Corp., Wijaya Karya, Toyo Construction Co. Ltd, TBEA Co. Ltd and Hyundai Engineering & Construction Co. Ltd are the major companies operating in the Indonesia Construction Market.
What years does this Indonesia Construction Market cover, and what was the market size in 2023?
In 2023, the Indonesia Construction Market size was estimated at USD 262.86 billion. The report covers the Indonesia Construction Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Indonesia Construction Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Indonesia Construction Industry Report
Statistics for the 2024 Indonesia Construction market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Indonesia Construction analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
