Jakarta — The government continues to encourage downstreaming policies to realize economic equality in Indonesia. More strategic management of natural resources is expected to increase the added value of national industry, global competitiveness, and reduce economic inequality between regions.
MIND ID President Director, Hendi Prio Santoso, stated that the presence of Danantara is part of the transformation of BUMN in optimizing state assets to provide greater benefits for the Indonesian economy.
“With more strategic investment management, Danantara is expected to be an accelerator in increasing the competitiveness of natural resource-based industries and supporting downstreaming and industrialization programs,” said Hendi.
He added that MIND ID carries out the mandate of integrated coal mineral reserve and downstream management in order to improve company performance and contribution to state revenues.
“With a strong commitment to downstreaming and industrialization, the establishment of Danantara will have a real impact on Indonesia’s economic sovereignty in the future,” he added.
Meanwhile, the Ministry of Industry (Kemenperin) is also strengthening downstreaming in the petrochemical and gas industries through various policies to achieve the target of 8 percent economic growth as directed by President Prabowo Subianto.
The Director General of the Chemical, Pharmaceutical, and Textile Industry (IKFT) of the Ministry of Industry, Taufiek Bawzier, emphasized that the petrochemical and gas sectors have a large multiplier effect on other economic sectors.
“The IKFT sector must increase its GDP contribution to IDR 46.09 trillion if the industry contributes 21.9 percent to national GDP,” he explained.
In addition, the banking sector also plays a role in supporting downstreaming. President Director of PT Bank Central Asia Tbk (BCA), Jahja Setiaatmadja, revealed that BCA’s corporate credit growth in 2024 was dominated by the downstream sector and the palm oil industry.
“We strongly support downstreaming. Of the 15.7 percent corporate credit growth, half came from downstreaming and CPO,” said Jahja.
He added that downstreaming projects require large investments, most of which are supported by foreign investors, such as China which invested in Morowali, Central Sulawesi.
“The construction of a smelter requires an investment of trillions of rupiah. It is difficult to rely only on local investors, so many of these projects receive foreign support,” he explained.
Jahja also emphasized that downstreaming the mining sector provides added value for Indonesia by reducing exports of raw materials, but still requires stable market demand. With synergy between the government, BUMN, and the private sector, downstreaming is expected to continue to be the main strategy in realizing economic equality and strengthening the national economy in the future.
