![\"\"](\"https:\/\/sumitomocorp-indpark.com\/en\/wp\/wp-content\/uploads\/2026\/09\/97b4489df8f3f74680557729669a29f8.jpeg\")
<\/p>\r\nIn this feature, we spoke to Hiroshi Baba, President Komisaris of Sakai Indonesia, a tenant company at PT. East Jakarta Industrial Park, about the history of the company\u2019s expansion into Indonesia, changes in the Indonesian market, and the appeal of EJIP, where the company has been operating for over 30 years.<\/p>\r\n
Established in 1995 as the Indonesian subsidiary of Sakai Heavy Industries Co., Ltd., a leading Japanese manufacturer of road construction machinery. The company manufactures and sells road construction machinery, primarily soil compaction rollers, and operates as a base for exports to Asia, the Middle East and Africa, in addition to serving the Indonesian market. Since EJIP began operations, it has remained one of EJIP\u2019s leading Japanese manufacturing companies.<\/p>\r\n
After joining the Bank of Tokyo (now Mitsubishi UFJ Bank) in 1982, he was posted to Indonesia in 1989. He played a key role in attracting Japanese companies to EJIP from its early days and has witnessed first-hand Indonesia\u2019s investment and industrial development the development over many years. He joined Sakai Heavy Industries Co., Ltd. in 2012 and has since been involved in the management of Sakai Indonesia.<\/p>\r\n
Indonesia has long been an important market for Sakai Heavy Industries. Although the company lost its Tokyo factory in the Great Tokyo Air Raid of May 1945, shortly before the end of the Second World War, it successfully rebuilt its operations in the post-war years. A major turning point in the company\u2019s growth cam in 1959 through reparations trade with Indonesia under the Sukarno administration. The company received a massive order for 275 rollers, exceeding its annual production volume at the time. This marked the beginning of a deeper relationship between Sakai Heavy Industries and Indonesia.<\/p>\r\n
In 1970, PT Sakai Sakti was established as a joint venture with a local partner and began operating a factory at the Pulogadung Industrial Estate in Jakarta. The fact that rollers manufactured by Sakai Sakti several decades ago remain in service today is testament to the enduring strength of the Sakai brand in Indonesia.<\/p>\r\n
Baba was first posted to Indonesia in 1989. At the time, he was working for the Bank of Tokyo and was involved in supporting Japanese companies\u2019 overseas expansion. In the late 1980s, deregulation under the Suharto administration fuelled growing interest among Japanese companies in expanding into Indonesia. However, the industrial infrastructure needed to provide a secure and reliable operating environment for foreign-owned manufacturers was still lacking.<\/p>\r\n
Against this backdrop, EJIP was conceived as Indonesia\u2019s first privately developed industrial park, led by Sumitomo Corporation and the Bank of Tokyo. The aim was to provide a comprehensive package of land, financing and an operating environment by having a trading house develop the industrial park, whilst a financial institution served as a point of contact for companies looking to establish a presence in Indonesia.<\/p>\r\n
\u201cI was posted to Jakarta in 1989 and attended the EJIP groundbreaking ceremony in 1990. It was truly a barren rice field, the sort of place where cows would be grazing.\u201d<\/p>\r\n
Such a scene is difficult to imagine for those familiar with EJIP today. Yet, that barren rice field would eventually become one of Indonesia\u2019s leading industrial estates, providing a base for numerous Japanese companies.<\/p>\r\n
<\/p>\r\n
After his posting to Jakarta, one of Baba\u2019s key roles was to introduce companies visiting from Japan to EJIP. At the time, the Bank of Tokyo served as a central point of contact for many Japanese companies seeking advice on overseas expansion. In an era when financing support and site selection often went hand in hand, Baba was the forefront of promoting EJIP to prospective investors.<\/p>\r\n
\u201cI was, in many ways, EJIP\u2019s salesman. I would meet visitors at the airport and take them straight to EJIP.\u201d<\/p>\r\n
According to Baba, many of EJIP\u2019s early tenants first learnt of the park through the Bank of Tokyo and subsequently decided to set up operations there. The Bank of Tokyo invested in EJIP and supported the project during its early development phase, both financially and in terms of attracting tenants. Once the sale of land was complete and the bank had fulfilled its initial role as a gateway for companies entering Indonesia, the Bank of Tokyo concluded its role as an investor, and the management of EJIP shifted to a structure centred on Sumitomo Corporation.<\/p>\r\n
In the early 1990s, Indonesia was vastly different from the country it is today. Even in Jakarta, power cuts were not uncommon, and reliable telephone and fax connections could not be taken for granted. Information from Japan was also difficult to obtain, with many people relying on shortwave radio broadcasts to keep up with the latest news. In such an environment, there were only a limited number of locations where companies could operate with confidence.<\/p>\r\n
Against this backdrop, EJIP attracted attention as an industrial estate of exceptionally high quality for its time, equipped with essential infrastructure such as water supply, electricity and roads. Baba himself recalls feeling that he could confidently recommend EJIP to Japanese companies.<\/p>\r\n
\u201cBy the standards of the time, EJIP was an industrial park of exceptional quality .\u201d<\/p>\r\n
An abundant and low-cost labour force, political stability, and a favourable climate for foreign investment driven by deregulation all helped to attract companies to Indonesia. At the same time, however, high-quality infrastructure and reliable management were essential for companies seeking to establish long-term operations. As a result, EJIP played a key role in turning investors\u2019 plans into reality.<\/p>\r\n
Sakai Heavy Industries, which had been operating in Indonesia since 1970, established PT. Sakai Indonesia in 1995. Sumitomo Corporation participated in the venture as a minority shareholder, and it was partly due to this relationship that the company chose to establish its operations at EJIP.<\/p>\r\n
It was here that two stories converged. One was the story of Baba, who during his time at the Bank of Tokyo played a key role in attracting companies to EJIP. The other was the story of Sakai Heavy Industries, which viewed Indonesia as a key manufacturing and export hub in Asia and went on to build its operations at EJIP.<\/p>\r\n
Baba later joined Sakai Heavy Industries and became involved in the management of Sakai Indonesia. The man who had once introduced companies to EJIP now found himself experiencing its value first-hand as a tenant within the industrial park.<\/p>\r\n
![\"\"](\"https:\/\/sumitomocorp-indpark.com\/en\/wp\/wp-content\/uploads\/2026\/09\/bb5501d25b113cacc721487531485f71-scaled.jpg\")
<\/p>\r\n
The business environment in Indonesia has changed significantly since EJIP was established. The abundant and low-cost labour force that once made Indonesia an attractive investment destination can no longer be taken for granted. Minimum wages have risen, while the emergence of Chinese manufacturers has intensified price competition in the construction machinery market. Coupled with factors such as reductions in public infrastructure spending, the operating environment for the construction machinery industry as a whole is becoming increasingly challenging.
\r\nOn the other hand, there is potential for new demand, including machinery for the mining and plantation sectors. Although the Indonesian market is becoming increasingly challenging, it remains a substantial market with significant long-term potential.<\/p>\r\n
Against this backdrop, one of the reasons Sakai Indonesia continues to operate at EJIP is the value generated by the concentration of Japanese companies within the industrial park. In addition to the proximity of suppliers and the ease of procuring components, the ease of information sharing among tenant companies through regular tenant meetings provides a significant competitive advantage for manufacturing firms.<\/p>\r\n
\u201cIn terms of parts procurement and access to information, the advantages of having a concentration of Japanese companies are enormous.\u201d<\/p>\r\n
Furthermore, EJIP offers an intangible value: a sense of security. This stems from a management structure involving major Japanese trading companies, expertise in tenant support accumulated over many years, and systems designed to safeguard the operational environment. Each of these elements, taken together, forms the foundation that underpins long-term operations.<\/p>\r\n
\u201cThere is reassurance in knowing that EJIP is operated by a major Japanese trading company.\u201d<\/p>\r\n
Baba recalls that when he joined Sakai Heavy Industries in 2012, Indonesia\u2019s labour environment was extremely challenging. in Indonesia was extremely challenging. There were periods when conditions were far from easy for Japanese companies, marked by intensifying labour disputes and friction with external groups. However, the operating environment within industrial parks has improved significantly since then, supported in part by the introduction of the National Vital Objects (Objek Vital Nasional \/ OVN) framework. Compared with the past, responses from the police and government authorities have become more effective, and a stable operating environment is now firmly taking shape.<\/p>\r\n
\u201cIt is no longer the environment it once was. I believe there have been significant improvements over the past decade.\u201d<\/p>\r\n
Sakai Indonesia originally operated as a base focused on exports. Whilst supplying products to a wide range markets across Asia, the Middle East and Africa, it also served the Indonesian domestic market.<\/p>\r\n
Subsequently, the domestic market grew in importance, and today domestic sales account for approximately half of the company\u2019s turnover. The company\u2019s production operations had previously been split between bonded and non-bonded factories. However, through a property introduction from EJIP, it successfully acquired a larger facility and consolidated both factories at the new site. By also relocating its sales company to the same premises, Sakai Indonesia not only improved production efficiency but established an integrated structure bringing together manufacturing, sales and service.<\/p>\r\n
This change not only reflects the growth of the Indonesian market itself, but also highlights how EJIP has supported the company\u2019s evolving business operations over the long term.<\/p>\r\n
Baba emphasises the importance of not making decision based solely on cost to companies considering establishing manufacturing operations in Indonesia and elsewhere overseas. Labour costs and land prices are important considerations, but companies must take a long-term view when selecting a location, factoring in port access, customs efficiency, logistics networks, supply chains and operational stability.<\/p>\r\n
EJIP is by no means the largest industrial park. However, it is a mature industrial park that has supported Japanese companies for 36 years, steadily building on its infrastructure and operational excellence.<\/p>\r\n
EJIP began as little more than a rice field. Baba\u2019s journey, from supporting its development from the perspective of a financial institution to speaking of its value as a manager of one of its tenant companies today, reflects the history that EJIP has built over the past 36 years. As a key manufacturing hub in Indonesia, EJIP will no doubt continue to evolve in the years ahead.<\/p>","protected":false},"featured_media":1034,"template":"","case_country":[41],"case_industry":[55],"class_list":["post-1033","case","type-case","status-publish","has-post-thumbnail","hentry","case_country-indonesia","case_industry-construction-machienery"],"acf":[],"_links":{"self":[{"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/case\/1033","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/case"}],"about":[{"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/types\/case"}],"version-history":[{"count":6,"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/case\/1033\/revisions"}],"predecessor-version":[{"id":1081,"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/case\/1033\/revisions\/1081"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/media\/1034"}],"wp:attachment":[{"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/media?parent=1033"}],"wp:term":[{"taxonomy":"case_country","embeddable":true,"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/case_country?post=1033"},{"taxonomy":"case_industry","embeddable":true,"href":"https:\/\/sumitomocorp-indpark.com\/en\/wp-json\/wp\/v2\/case_industry?post=1033"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}