REPUBLIKA.CO.ID, BATAM -- Batam city has been witnessing an economic slowdown since 2011 as the contribution of its manufacturing and shipbuilding industries has been on a decline, according to Bank Indonesia.

Also, the city remains dependent on imported goods.

"The economic slowdown has been ongoing since 2011 because of the weak manufacturing sector," Chief of Bank Indonesia Office in Riau Islands Province, Gusti Raizal Eka Putra, said here on Thursday.

He said the manufacturing industry plays a great role in Batam's economy as a whole. Thus, when the manufacturing industry is disrupted, it has a far-reaching impact on the local economy.

The manufacturing industry has been passing through a sluggish phase because of the global economic slowdown in recent years, he said.

The other factor affecting the Batam economy in the past four years has been the sluggish shipbuilding industry, he said, adding that the situation has been like this ever since the government issued a policy banning the export of unprocessed minerals and coal a few years ago.

Before the law on minerals and coal took effect, the shipbuilding industry in Batam received many orders for ships and tugboats to carry minerals and coals for export. After the policy was issued, the orders fell drastically, he said.

"In the past two years, the number of orders for ships fell following the issuance of the law on minerals and coal. The policy has had a devastating impact on the industry," he said.

The local industry's dependence on imported raw materials, security issue and labor rallies, was also one of the causes of the economic downturn, he said.

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