By: Anggina Dewi*
The construction of a copper smelter and precious metal refining facility in West Sumbawa Regency, West Nusa Tenggara (NTB), marks an important step in efforts to increase economic growth in the region and nationally. President Joko Widodo (Jokowi) has emphasized that the operation of this smelter is expected to boost the gross regional domestic product (GRDP) in NTB and West Sumbawa, as well as provide great benefits to the people. Through this investment, Indonesia has the potential to change its position as one of the countries with the largest copper reserves in the world to a country with significant added value through the processing of natural resources.
The smelter facility built by PT Amman Mineral Nusa Tenggara (AMNT) will not only reduce dependence on raw material exports, but also open up opportunities for the development of downstream industries. With a processing capacity of 900 thousand tons/year, the smelter is designed to process copper concentrate from the Batu Hijau mine and the Elang mine, as well as produce high-purity copper cathodes and sulfuric acid. This step is part of the government’s efforts to ensure that the added value of natural resources remains domestic, not only flowing to countries that have processing facilities.
The existence of this smelter is also one of the fastest mega projects ever built, with a total investment reaching IDR 21 trillion. In about 14 months, this facility has been established and ready to operate, showing Amman’s strong commitment to contributing to the national economy. In addition, the presence of this smelter is expected to create thousands of new jobs, which are important for poverty alleviation and improving the welfare of the surrounding community.
Minister of Energy and Mineral Resources, Bahlil Lahadalia, emphasized the importance of downstreaming the mining sector to strengthen the competitiveness of Indonesia’s manufacturing industry in the global arena. According to him, all entrepreneurs who have obtained mining permits from the government must have smelter and refining facilities. With this step, it is hoped that it will not only increase economic growth, but also create a multiplier effect through increased employment and tax contributions.
In addition, the construction of a smelter in Gresik, East Java by PT Freeport Indonesia, is another example of the government’s commitment to encourage downstreaming. This smelter is expected to increase the contribution of the industrial sector, which now reaches 31.54%, to regional economic growth. Acting Governor of East Java, Adhy Karyono, is optimistic that this smelter will not only improve Gresik’s economy, but also create a multiplier effect that will be felt throughout East Java.
Through the development of smelters, taxes generated from these industrial activities will have a positive impact on the regional economy. Non-metallic mineral and aid taxes (MBLB) and surface and ground water taxes will contribute significantly to regional income. This shows that downstreaming not only brings benefits to companies, but also to the wider community through increased regional income.
The government’s commitment to encourage downstreaming of the mineral industry is a strategic step in order to optimally utilize natural resources. In this context, the courage and goodwill of companies such as AMNT and Freeport are key to achieving this goal. By processing natural resources into value-added products, Indonesia can strengthen its position in the global market and improve people’s welfare.
In this era of globalization, it is important for Indonesia to not only be a producer of raw materials, but also a major player in the processing industry. The existence of copper smelters and precious metal refining facilities is a concrete step that must be encouraged by all parties, including the government, entrepreneurs, and the community. By jointly committing to downstreaming, we can ensure that Indonesia’s natural resources provide maximum benefits to all levels of society and create a better future.
In a broader context, downstreaming the mineral industry in Indonesia is an important step in creating a sustainable economy. This is in line with the government’s vision to maximize the use of natural resources and create added value for the Indonesian people.
The construction of copper smelters and precious metal refining facilities in NTB and East Java is a real example of Indonesia’s commitment to strengthening the national industrial and economic sectors. With good and sustainable management, these facilities will make a major contribution to economic growth, create jobs, and improve people’s welfare. This effort must continue to be supported by all parties, so that the benefits of abundant natural resources can be felt by all Indonesian people.
This is a momentum for Indonesia to move forward towards a more sustainable and independent economy. As a nation, we have a responsibility to ensure that every step taken in managing natural resources will have a positive impact on future generations. Thus, downstreaming is the key to building an inclusive and sustainable economy, and ensuring that Indonesia can compete globally with high-value products.
)* The author is a student from East Java
