Minister of Industry Appreciates SCG to Build Rp75 Trillion Petrochemical Plant

By : Ridwan And Aldi Firhand | Friday, March 16 2018 - 22:00 IWST

Menperin Airlangga Hartarto saat menerima kunjungan CEO SCG Roongrote Rangsiyopash (Foto: Humas)
Menperin Airlangga Hartarto saat menerima kunjungan CEO SCG Roongrote Rangsiyopash (Foto: Humas) - Jakarta, Indonesia has the potential to become the center of growth of the petrochemical industry and will be more competitive at ASEAN level with the increasing investment and expansion of several domestic producers.

One of them will be realized by a large Thai manufacturer, Siam Cement Group (SCG), which plans to build a naphtha crackers production facility worth USD 5.5 billion or equivalent to Rp75 trillion in Cilegon, Banten.

"This shows that Indonesia is still an investment destination country as government efforts continue to create a conducive business climate that is one of the largest in Indonesia and for SCG itself," said Minister of Industry Airlangga Hartarto after meeting with SCG delegation led by President & CEO of SCG, Roongrote Rangsiyopash in Jakarta, Friday (16/3/2018).

According to Airlangga, SCG project progress is already at the design stage of the plant which will take 8-9 months and is targeted to operate in 2021 or 2022.

"This SCG investment is a form of cooperation with PT Chandra Asri Petrochemical Tbk SCG, as a strategic shareholder in Chandra Asri, has a strong technology and funding, and Chandra Asri will also expand," he said.

Menperin said the petrochemical plant that will soon be built will have a production capacity doubled from existing factories in Cilegon, which is about 1.2 million tons per year.

This new plant, in addition to creating jobs and increasing value added, will also produce its products to meet the needs of domestic and export markets.

"The production will be complete, ranging from naphtha cracker, ethylenedan propylene, to polyethylenedan polypropylene," said Airlangga.

The Ministry of Industry noted that naphtha cracker from national industrial production is 900 thousand tons per year, while domestic demand reaches 1.6 million tons. Meanwhile, Singapore already produces 3.8 million tons and Thailand 5 million tons per year.

For that, continued Menperin, the government gives appreciation to the SCG investment and will seek to facilitate the provision of tax holiday. These tax incentives will be given with consideration of the value of large investment and can save the country's foreign exchange because of its production to substitute imported raw materials.

Previously, Roongrote Rangsiyopash conveyed, it has selected Indonesia as one of the largest investment destination in the ASEAN region. His confidence is due to the current economic growth of Indonesia is getting better with the support of various government policies to provide ease of business for investors.

"We convey, we are very pleased with Indonesia's good economy which is also accompanied by supporting regulations and stable political situation," he said.

In fact, he also claimed that the company's efforts are now in line with the Government of Indonesia's desire to accelerate the development of industry in Indonesia, especially the petrochemical sector.

"We are pleased that President Jokowi has also given full attention to the construction of this factory," he added.

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