Bahlil: Downstreaming Ways For Indonesia To Get Out Of The Trap Of Middle-Income Countries

JAKARTA - Investment Minister/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia said downstreaming is a way for Indonesia to get out of the trap of middle-income countries because of the great benefits to be able to boost the economy from existing resources.

"There is no other way for Indonesia to get out of middle income. The only way is for us to build downstream. It is enough that we sell our country," said Bahlil Lahadalia, quoted from ANTARA, Wednesday, August 3.

Bahlil recalled that when he was just appointed as Head of BKPM in 2019, he was ordered by President Joko Widodo (Jokowi) to stop exports of nickel ore.

He was demoted by entrepreneurs up to 1.5 months later.

However, it turned out that the policy to stop nickel ore exports was bearing fruit because currently the downstream industry using nickel as raw material is now able to boost export performance.

Nickel downstream is also projected to make Indonesia one of the biggest players in the cell battery industry for electric vehicles.

"We have built an EV (electric vehicle) ecosystem and battery cells in Indonesia now," said Bahlil Lahadalia.

Currently, Indonesia has succeeded in attracting investment in the development of global electric vehicle batteries, from LG (South Korea), CATL (China), Foxconn (Taiwan), to VW and BASF (Germany).

Bahlil said that this year the government will also arrange exports of raw bauxite and tin.

The government wants to build a downstream industry for the two minerals in the country so that the added value can be absorbed domestically.

"It's no longer allowed to export raw (bauxite) and tin. Our tin is the second largest in the world, China's number one. But China is 80 percent building downstreaming in their country. Indonesia is building only 5 percent of downstream. We are the largest tin exporter in the world, the price of tin is played by other countries. Is it crazy?," said Bahlil.

He hopes that all efforts made by the government in encouraging the downstream industry will be able to support the welfare of the people as the investment objective.

"We hope that added value can enter Indonesia and then be able to create jobs that have better salaries than are labor-intensive," said Bahlil.