By: Eleine Pramesti *)
The downstream program initiated by the government is one of the main pillars in strengthening the foundation of the national economy. This policy is not only focused on increasing the added value of domestic commodities, but also becomes a driving force for massive job creation.
President Director of PT Indonesia Asahan Aluminium, Melati Sarnita said the downstream project being carried out by Inalum will create new jobs. One real proof of the success of the downstream implementation is the absorption of workers reaching 90,000 people.
It should be noted that Inalum and PT Aneka Tambang Tbk (ANTM) are now working together and have a joint venture company PT Borneo Alumina Indonesia (BAI). PT BAI operates a bauxite processing and refining facility (smelter) into alumina in Mempawah, West Kalimantan.
The Smelter Grade Alumina Refinery (SGAR) phase 1 project, which has an alumina production capacity of up to 1 million tons per year, was officially injected with bauxite for the first time by the 7th President of the Republic of Indonesia, Joko Widodo (Jokowi) on September 24, 2024. Previously, the 7th President said that downstreaming of natural resources is the key to making Indonesia an independent industrial country. In addition, he emphasized the importance of building the smelter as a strategic step to stop exporting raw materials and start processing natural resources domestically.
In addition, the President of the Republic of Indonesia, Prabowo Subianto ensured that the government he leads will continue the downstreaming program that was intensified during the previous administration. The President said that downstreaming needs to be continued so that the wealth of natural resources owned by Indonesia can be utilized optimally to provide welfare for the community.
Therefore, the absorption of labor in the downstream program is a strong indicator that economic transformation through industrialization has a real impact on society. The figure of 90,000 workers absorbed did not just appear. This is the result of mature medium and long-term planning, synergy between the central and regional governments, and strategic partnerships with the private sector.
The development of industrial areas based on downstreaming in various regions such as Sulawesi, Kalimantan, and Sumatra shows that equitable development is no longer just a discourse. The presence of these areas also revives the local economy, triggers planned urbanization, and increases the purchasing power of the surrounding community.
Downstreaming also has a significant impact on strengthening the quality of human resources. To meet the need for workers in the downstream industrial sector, trained and competent workers are needed. This encourages vocational education institutions and job training to be more responsive to industry needs. The curriculum is adjusted, training is carried out intensively, and collaboration between the business world and the world of education is strengthened. As a result, the workforce absorbed in the downstream program is not only large, but also has the quality to compete globally.
Furthermore, downstreaming is the answer to the challenge of dependence on raw material exports. For years, the Indonesian economy has relied on exports of raw commodities such as nickel, coal, and palm oil. This situation makes Indonesia vulnerable to global price fluctuations. By encouraging downstreaming, Indonesia is no longer an exporter of raw materials, but is starting to play a role as a producer of goods with higher added value.
This change certainly has a positive impact on the trade balance and long-term economic growth. With the certainty of regulations and the government’s commitment to downstreaming, investors feel safer and more interested in investing in Indonesia. The impact is that employment opportunities are expanding and the economy is becoming more dynamic.
Good industrial governance is also needed so that downstreaming runs fairly and transparently. The government has ensured that the benefits of downstreaming reach the wider community through periodic monitoring and evaluation mechanisms. “The government continues to strengthen the monitoring and evaluation system so that downstreaming runs fairly, transparently, and inclusively.
The downstream policy also strengthens Indonesia’s competitiveness amidst increasingly tight global competition. Developed countries have long relied on the high-tech manufacturing industry sector. With downstreaming, Indonesia is not only catching up, but is beginning to show its identity as a new industrial country. The absorption of large numbers of workers is proof that downstreaming is able to unite macro and micro economic interests within a sustainable development framework.
The government also continues to harmonize policies between the central and regional governments so that the downstream process is not hampered by differences in regulations or complicated permits. Simplifying bureaucracy and digitizing licensing services are concrete steps to accelerate the realization of downstream projects. Synergy between business actors, workers, government, and the community is the key to the success of all these programs.
With the spirit of collaboration and hard work of all components of the nation, downstreaming can be a major milestone in Indonesia’s journey towards a modern industrial nation. The absorption of 90,000 workers is the beginning of a big leap, not the end of the journey. Therefore, consistency and sustainability are the keys so that this policy is not just a momentary program, but becomes a strategic legacy for future generations.
)* The author is an Energy Journalist at the Greenpeace Resources Institute
