Market Size of Indonesia Construction Industry
| 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 |
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 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 Size Summary
The Indonesian construction industry is poised for significant growth, driven by substantial government investment in infrastructure projects such as roads, bridges, airports, and railways. These initiatives are part of a broader strategy to enhance connectivity, reduce logistical costs, and stimulate economic development. The market is characterized by a high level of foreign investment, with international companies actively participating in various projects, fostering a competitive and diverse landscape. The government's commitment to infrastructure is further underscored by its largest budget allocation in five years, aimed at advancing transport, industrial, energy, and housing projects. This strategic focus is expected to bolster the construction sector's expansion, supported by partnerships between government entities, state-owned enterprises, and private sector players.
The demand for residential properties is on the rise due to urbanization and a growing middle class, leading to increased construction activity in both urban and rural areas. The market is also witnessing a surge in data center developments, positioning Indonesia as a key player in Southeast Asia's public cloud market. Major cloud providers are establishing a presence in the country, further driving demand for infrastructure. The construction industry is competitive, with significant contributions from local state-owned enterprises and international firms. Collaborative efforts, such as those seen in the Indonesia Incorporated Day event, aim to strengthen ties between the government, private sector, and small enterprises, promoting global integration and market cohesion. As the industry continues to evolve, it presents numerous opportunities for growth and increased competition among key players.
Indonesia Construction Market Size - Table of Contents
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1. MARKET INSIGHTS AND DYNAMICS
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1.1 Current Economic and Construction Market Scenario
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1.2 Technological Innovations in the Construction Sector
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1.3 Impact of Government Regulations and Initiatives on the Industry
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1.4 Impact of COVID-19 on the market
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2. MARKET SEGMENTATION
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2.1 By Sector
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2.1.1 Commercial Construction
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2.1.2 Residential Construction
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2.1.3 Industrial Construction
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2.1.4 Infrastructure (Transportation) Construction
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2.1.5 Energy and Utilities Construction
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Indonesia Construction Market Size 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.
