Witnessed By President Jokowi And Two Ministers, Krakatau Steel And Posco Tie Rp52 Trillion Cooperation For Electric Vehicle Steel Supply And IKN Development

Photo: Doc. Ministry of Investment/BKPM

JAKARTA - PT Krakatau Steel (Persero) Tbk together with the Ministry of Investment signed a Memorandum of Understanding (MoU) on investment cooperation with Posco in Seoul, South Korea. This collaboration is to expand the automotive steel production capacity for electric vehicles.

The total investment reached 3.5 billion US dollars or equivalent to IDR 52 trillion. This collaboration is also carried out to facilitate the project plan for the development of the Capital of the Archipelago (IKN).

The signing of the cooperation was carried out by the Minister of Investment of the Republic of Indonesia/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia, President Director of Krakatau Steel Silmy Karim, and CEO of Posco Kim Hag Dong witnessed by Indonesian President Joko Widodo. Also present at the event were Minister of SOEs, Erick Thohir and Minister of PUPR Basoeki Hadimoeljono.

Bahlil said the Ministry of Investment ensured that the Ministry or Government Agencies would provide all support to Krakatau Steel and Posco needed for the issuance of permits for projects and investment incentives by the prevailing laws and regulations in Indonesia.

"I am very happy with the commitment of Krakatau Steel and Posco for their investment in Indonesia. This expansion of investment will certainly contribute greatly to the growth of the steel industry in Indonesia in the future", said Bahlil, in an official statement, Thursday, July 28.

"We will facilitate and provide full support so that this project runs smoothly. We will help take care of the permit. If there is a problem, don't hesitate to report it to us", he continued.

Meanwhile, the President Director of Krakatau Steel, Silmy Karim, said he was very pleased with the government's support in realizing the expansion of PT Krakatau Posco, which is a joint venture between Krakatau Steel and Posco.

"We will continue to actively collaborate in implementing the investment plan as agreed. PT Krakatau Posco will become the largest integrated steel company in Southeast Asia", said Silmy.

Silmy said that in this MoU Krakatau Steel and Posco agreed to invest in expanding the production capacity of PT Krakatau Posco which is planned to reach 10 million tons per year, both upstream and downstream products.

This plan, continued by Silmy, allows Krakatau Steel and Posco to produce high-value-added steel products such as automotive steel as a support for the government's plan to make Indonesia the base of the world electric car industry.

"In addition, the collaboration between Krakatau Steel and Posco is also prepared to support the Nusantara Capital (IKN) project where Posco has long experience in the construction of several cities in Korea", he said.

Silmy Karim also ensures that the cooperation between Krakatau Steel and Posco can also reach the localization level on the Project by the requirements of the Domestic Component Level (TKDN).

Posco CEO Kim Hag Dong admitted that since the early stages of investment his party had been well facilitated by the Ministry of Investment. Therefore, he believes that we can expand our investment plan.

"We hope that this investment can make a positive contribution to Indonesia's national economic growth and will continue to improve cooperative relations between Indonesia and South Korea in developing investment in the future", said Kim Dog Hang.

For your information, Posco is the fourth largest steel producer in the world with a production capacity of 42 million tons of steel per year, which has two steel factories in Pohang and Gwangyang, South Korea.

This South Korean multinational company also has investments in various countries such as in Asia, namely Indonesia, Vietnam, Thailand, Malaysia, the Philippines, and India. Also in the United States, Canada, and Mexico, as well as in Europe and Australia.