Indonesia needs to downstream SMEs raw commodities: Jokowi
Jakarta, The Gulf Observer: Indonesian President Joko Widodo (Jokowi) stated that the downstream policy is not limited to mining products but also raw material commodities for the production of small and medium enterprises (SMEs).
“Downstreaming is not only for nickel, copper, and other mining products. We also have to industrialize our SMEs, downstream all products that are still raw,” he remarked at the 2023 Indonesian Young Entrepreneurs Association (Hipmi) National Working Meeting in Tangerang, Banten, on Thursday.
Jokowi then drew attention to several potential raw materials in the domestic SME sector, such as coffee bean variants, sugar variants, seaweed, agar flour, and palm oil, that could be downstreamed.
The president reminded that all raw materials provided by nature in Indonesia must be fully controlled for domestic market needs.
“Do not export our natural resources in the form of raw commodities. We must control our domestic market,” he emphasized.
On the occasion, Jokowi said Indonesia’s natural wealth, in the form of seaweed, was ranked second in the world as an export commodity with no downstream policy.
“There is also a lot of seaweed that has not been downstreamed. We are the second-biggest seaweed producer, but we are still exporting raw material. I check where the export goes. It goes to the Philippines, to Thailand. Why we cannot make our own industry here?” he stressed.
Citing an example, Jokowi explained that agar flour can also be downstreamed into craft products to generate added value for SMEs.
Apart from offering added value, the downstream policy also provides employment opportunities while concurrently contributing to state revenues.
He noted that Indonesian farmers were able to produce 46 million tons of palm oil per year that could be channeled to domestic medium industries for the production of soap, cocoa butter, or oleofood, that could generate multiple added values.
“Our palm oil planted by our farmers, which amounts to 46 million tons per year, can be used for the SMEs industry for soap, cocoa butter, and oleofood production, with multiplier value, amounts to eight times or five times,” he remarked.
