Policy Prohibition and Restriction of Raw Materials Making Industry Player Fretful

INDUSTRY.co.id - Jakarta- The Ministry of Trade (Kemendag) plans to issue Lartas (Prohibition and Restriction) on import of industrial raw materials. This policy makes the industry anxious.

This is because a number of raw materials commodities can not be fully met by domestic industry. As if the Lartas is successfully published then the national industry will find it difficult to obtain raw materials that have an impact on the decline in competitiveness and industrial productivity

Chairman of the Association of White Cigarette Manufacturers Indonesia, Muhaimin Moeftie said, the need for tobacco as raw materials for the domestic cigarette industry is more than 300 thousand tons per year. However, domestic tobacco production is only able to supply up to 200,000 tons per year, this resulted in the tobacco industry must import about 100,000 tons per year.

"Prohibition and restriction (Lartas) of industrial raw materials imports should not be an additional burden for the industry," said Muhaimin in a press release in Jakarta (7/9/2017).

According to him, Lartas policy can disturb the sustainability of the national cigarette industry. "This will be an additional burden for us and affect our production," he explained.

On the other hand, the Association of Indonesian Cigarette Manufacturers, Hasan Aoni Azis said that the domestic industry has prioritized the use of local raw materials. The root of the problem occurs because local production has not been able to meet the needs of the cigarette industry.

"The government should pay attention to the domestic tobacco production capability, especially the farmers in meeting the needs of the industry, and the government should prioritize non-punish rewards," he added.

Meanwhile, the Deputy Assistant of Industrial Development of the Coordinating Ministry for Economic Affairs, Atong Soekirman stated that the problem of raw material fulfillment is currently the government's priority in order to guarantee the achievement of domestic industry growth target.

"Not all industrial raw materials can be produced domestically so imports can not be avoided," Atong said.

He requested that the relevant Ministries be able to coordinate any plan of making the trading rules to the Coordinating Ministry for Economic Affairs.

"Especially if the related raw materials industry, without adequate raw material support this will have an impact on the decline in industrial competitiveness," he concluded.