Ministry Encourages Implementation of Policy in Downstream Industry
The Ministry of Industry will consistently encourage the implementation of the policy in the downstream industry to increase the value addition of domestic raw materials.
“In the past, we exported mine minerals such as nickel ore. But now we have processed it into nickel pig iron (NPI). The value has already been multiplied, from around 30 US dollars per metric ton to 1300-1400 US dollars,” Secretary General of the Ministry of Industry Haris Munandar said in a statement in Jakarta on Monday.
Moreover, he said, nickel pig iron has been upgraded to stainless steel.
He cited the Morowali industrial area, Central Sulawesi, as one of the centers for the development of nickel smelters that has contributed significantly to the local and national economies.
From the region, the value of investment is 5 billion US dollars, while its exports reached 4 billion US dollars.
The region also employed as many as 30 thousand people until 2018.
“We used to export bauxite and import alumina to make aluminum. But now we have a factory to process bauxite into alumina,” Munandar remarked.
Thus, the aluminum industry can use self-produced raw materials.
In addition, the downstream program in the agro sector, such as the crude palm oil / CPO industry, provides a ratio of downstream product exports of 80 percent as compared to upstream products.
“We have diversified CPO products, so that our CPO derivative products reach more than 100, for example, to biodiesel products,” Haris said.
Therefore, through downstreaming, the manufacturing industry also significantly contributes to the value of national exports.
“Last year, the contribution of manufactured exports reached 72.28 percent of total national exports,” he said.
The export value of the non-oil and gas processing industry throughout 2018 was able to penetrate 130.74 billion US dollars or an increase compared to 2017, which saw 125.10 billion US dollars.
“Our export products include food and beverages, clothing and footwear and two-wheeled and four-wheeled vehicles. In fact, one of our pharmaceutical companies has emerged as the top three in the UK market and has begun to expand to other European countries,” he explained.
To that end, the Ministry of Industry continues to maintain the availability of raw materials and auxiliary materials for the needs of the production process in the manufacturing sector in an effort to spur domestic industrial productivity.
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