By: Aristika Utami
Copper is one of the mineral commodities that plays an important role in various industrial sectors, especially in electronics, energy, and infrastructure. However, although Indonesia has large copper reserves, most of the copper mining results are processed abroad, which reduces the potential added value that can be obtained. Therefore, optimizing copper downstreaming is very important to increase the competitiveness of Indonesia’s national industry.
In the context of copper, downstreaming can include processing copper from raw materials into products such as cables, electronic equipment, and various other industrial components that have high demand in the domestic and international markets. By processing copper domestically, Indonesia can not only increase state revenues through taxes and exports, but also create new jobs and reduce dependence on imports of processed copper products.
A researcher from the Institute for Development of Economics and Finance (INDEF), Ahmad Heri Firdaus said that copper downstreaming has great potential in supporting national energy and industrial security. However, to ensure that the competitiveness of downstream products can be optimal in the global market, comprehensive support is needed from various sectors. One important factor that needs to be considered is the development of better basic infrastructure and improved connectivity.
With the growing trend towards renewable energy and electric mobility, the demand for copper is expected to continue to increase. Indonesia, which has abundant copper reserves, has a great opportunity to take advantage of this momentum by processing copper domestically, so that it can not only meet domestic needs but also supply the international market.
Copper downstreaming will support the development of the green energy and electric vehicle industry in Indonesia, while opening up opportunities for the development of new technologies and innovations that can strengthen Indonesia’s position in the rapidly growing global industrial sector. In this case, copper processing is an important component in the development of renewable energy infrastructure, such as solar panels and wind turbines, which require copper raw materials to produce quality products.
Through PT Freeport Indonesia, MIND ID plays a very crucial role in encouraging copper downstreaming in Indonesia, with the aim of ensuring that more strategic industries develop domestically. As one of the largest copper producers in Indonesia, Freeport has great potential to process copper into high value-added products that can meet the needs of various industrial sectors, such as electronics, renewable energy, and automotive.
MIND ID Corporate Secretary, Heri Yusuf, said that MIND ID consistently carries out sustainable downstreaming and is ready to support the industry in producing various innovative copper-based technology products domestically. Through strategic steps in downstreaming, MIND ID helps accelerate the development of a more independent and competitive domestic industrial ecosystem. One of MIND ID’s efforts in strengthening downstreaming is by building the Freeport Indonesia smelter in Gresik, East Java. This smelter is a key infrastructure in national copper refining which will increase production capacity and added value of minerals domestically.
To support the optimization of copper downstreaming, the Indonesian government has taken various strategic steps. One of them is by repairing and improving the infrastructure that supports copper processing. The construction of a smelter (copper processing plant) is one of the important steps in accelerating downstreaming. With a smelter that can process copper into semi-finished or finished products, Indonesia will get more benefits from this commodity. In addition, the facility will also help increase national copper production capacity and create jobs in the areas around the smelter.
Chairman of the Indonesian Mining Experts Association (Perhapi), Rizal Kasli said that the formation of the Investment Management Agency and the role of MIND ID provide a great opportunity to build a new company that specifically operates in the copper downstream sector. The existence of this agency also provides opportunities for the development of new technologies and innovations that can produce high-quality copper products. This certainly saves the country’s foreign exchange, because it can reduce dependence on imports of processed copper goods. Indonesia has great potential in the development of renewable energy, and copper is the main raw material in the manufacture of energy generating equipment, such as wind turbines and solar power systems. By optimizing copper downstreaming, Indonesia can not only support the resiliencedomestic energy, but also plays a role in the development of environmentally friendly renewable energy.
Optimizing copper downstreaming is a very important strategic step to increase the competitiveness of Indonesia’s national industry. By processing copper domestically, Indonesia can create more jobs, increase added value, and reduce dependence on imports of processed copper goods.
The government has made various efforts to support copper downstreaming through policies that facilitate investment, improve infrastructure, and develop competent human resources. However, challenges in terms of investment and technology must continue to be overcome to ensure sustainable and efficient copper downstreaming. With the right steps, copper downstreaming can become a main pillar in the development of an independent, highly competitive Indonesian industry that is able to compete in the global market.
)* The author is an observer of economic issues
