Accelerating National Economic Growth, Government Prepares Anticipatory Steps To Become Global Key Player in Commodity-Based Downstream Industry
By : Nata Kesuma | Monday, February 06 2023 - 15:00 IWST
the Coordinating Minister for the Economy Airlangga Hartarto
Optimism to avoid a recession and promote a faster economic recovery has resurfaced in view of the latest developments in global economic conditions.
A number of global economic indicators are not expected to put further pressure on global economic growth, the IMF has even revised its 2023 global economic growth projection to 2.9% from the previous level of 2.7%.
Observing this, the Government remains anticipatory and prepares various policies to encourage national economic growth. A number of sectors will be strengthened and are expected to become a source of economic growth in 2023, one of which is the industrial sector.
"Referring to BPS data, the manufacturing sector contributed the most to GDP and in the third quarter of 2022 it reached 16.1%. The Industrial Confidence Index at the Ministry of Industry is 51.54 while the PMI has released 51.3 in January 2023," said the Coordinating Minister for the Economy Airlangga Hartarto virtually in the 2023 Economic & Business Outlook Webinar organized by Warta Ekonomi, Friday (3/ 02).
In the short term, to strengthen domestic consumption which is expected to boost demand from the industrial sector by encouraging the use of domestic products. For the medium to long term, the Government will continue economic transformation to increase competitiveness, increase investment, boost HR productivity, and absorb labor through the implementation of the Job Creation Law.
As one of the countries in the world with high natural resource potential, the Government is also determined to become a Global Key Player in the commodity-based downstream industry. The government is focusing the commodity downstream industry into 3 groups, namely agro-based industries such as the oleochemical industry, mineral mining materials-based industries such as the mineral and metal smelter industry, and oil and gas and coal-based industries such as the coal to methanol project .
“The government also continues to encourage the potential of natural resources. For example, Indonesia has the largest reserves of nickel in the world and the President's directives are to continue to reduce exports of raw materials and continue to increase downstream production," said the Coordinating Minister for Airlangga.
The government is also actively promoting the downstreaming of superior mineral and metal-based commodities such as bauxite, tin and nickel. Refining and processing bauxite into aluminum end products is targeted to increase national income from IDR 21 trillion to IDR 62 trillion.
Downstreaming tin is also expected to produce rare earth metals which are critical components of today's modern technologies. For the nickel sector, after the initial downstream phase was successful with the growth of pyrometallurgical smelters producing ferronickel and stainless steel, now the second phase is being carried out by making Indonesia a center for electric vehicle battery production .
"Downstream efforts will certainly continue to be encouraged to add added value to the industry. The government also provides a number of things such as providing industrial infrastructure, creating a conducive industrial business environment, issuing fiscal incentives, of course also encouraging human resources to keep up with technological developments," concluded the Coordinating Minister for Airlangga.