However, since the Indonesian government decided - in September 2018 - to impose higher import tariffs on ceramics as well as on various other products in an effort to curtail imports - hence improve Indonesia's current account deficit and strengthen the value of the rupiah - there is room for some optimism. Moreover, a special regulation (issued by Indonesia's Finance Ministry) for import tariffs on ceramic tile products, which will be put in place for the duration of three years, was issued on 19 September 2018. Based on this regulation, a 23 percent import tariff is imposed on ceramic tile imports during the first year. In the second year, the tariff is reduced to 21 percent, while in the third year, the tariff drops further to 19 percent. The regulation aims at curbing the huge inflow of ceramic tiles into Indonesia, and which undermines the success of the domestic ceramic industry in Indonesia.

The improved outlook made four (big) existing players in Indonesia's ceramic industry - Arwana Citramulia, Mulia Group, Gemilang Mitra Sejahtera, and Jui Shin - decide to invest in new ceramic plants (which are expected to be opened in the second half of 2019). Together these plants will add some 40 million square meters (m2) in ceramic production capacity, meaning that Indonesia's combined annual installed ceramic production capacity is set to pass well beyond 600 million m2 (to approximately 620 million m2) at the end of 2019.

Edy Suyanto, Chairman of the Indonesian Ceramic Industry Association (ASAKI), said the new Finance Ministry regulation - that imposed import tariffs on ceramic tiles - brings a wave of fresh air into Indonesia's ceramic industry as it will reduce the competitiveness of imported ceramic tiles significantly. Therefore, Indonesia's national utilization rate (of total installed national ceramic production capacity) should rise from around 65 percent currently to the range of 70-73 percent by the end of 2019.

According to data from Ceramic World Review, China remained the world's top ceramic producer in 2017 with total annual production capacity at 6.4 billion m2, followed by India (1.08 billion m2), and Brazil (790 million m2).

While Suyanto is optimistic that domestic ceramic demand is set to rise next year, he is not so optimistic about Indonesian ceramic manufacturers' chances to gain ground in export markets as there exists fierce competition. Problematically, Indonesian ceramic manufacturers pay a USD $9 mmbtu gas price, while foreign counterparts in the region can enjoy a gas price in the range of USD $4 - $6 per mmbtu price. This is one of the main reasons why Indonesian manufacturers have difficulty to compete with foreign counterparts.