Bahlil Admits Downstreaming Is Not 100 Percent Fair

Investment Minister Bahlil Lahadalia. (Photo: Doc. Antara)

JAKARTA - Investment Minister/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia admitted that investment made in the mining downstream sector in Indonesia has not been fully 100 percent fair. In particular, for local entrepreneurs and local communities.

"I honestly say that downstreaming right now is not really 100 percent fair. I have to be honest in this room," he said in a Public Lecture at IPDN, quoted from YouTube, Ministry of Investment, Jakarta, Thursday, July 11.

Bahlil said any investment that explores natural resources (SDA) will certainly have an impact on the local community. For example, he said, investment in nickel, copper or coal mining will definitely have evictions to land loss.

"Definitely. Well, now how is the process? The land taken doesn't mean it is taken unpaid, everything will be discussed between the owner and the investor," he explained.

Therefore, according to Bahlil, the government must make a formulation in order to encourage fair and environmentally oriented investments. For example, by formulating downstream rules.

Bahlil said downstreaming was indeed something new in Indonesia. Therefore, the location of the problem is only known when it has been implemented.

Our task now is to improve what is not perfect. For inequality matters, this must be considered because every investment that comes in must create jobs and reduce inequality," he explained.

According to Bahlil, downstreaming is a road to Indonesia Gold 2045. Where the government first encouraged investment in the downstream nickel sector in October 2019.

Furthermore, Bahlil said the move was motivated by nickel exports from 2017 to 2018 of only US$3.3 billion.

"Only 3.3 billion US dollars. Then we stop exporting nickel ore to Europe. We stop and then we build the domestic industry. Massive we do. What happens? 2023 our export value from nickel downstream results reached 33.5 billion US dollars," he said.

"Going up 10 times only for 4 to 5 years. That means we've been lying to us all this time. And what's going on? When we stop exporting nickel ore, Europe takes us to the WTO," he continued.