HMSP Investment IDR 5.35 Trillion Builds Smoke-Free Product Factory In Karawang

HM Sampoerna press conference (Photo: Aris Nurjani/VOI)

JAKARTA PT HM Sampoerna Tbk (HMSP), together with parent company Philip Morris International (PMI), disbursed an investment of US$330 million or around Rp5.35 trillion (exchange rate of Rp16,233) to build a production facility for smoke-free tobacco products in Karawang, West Java.

President Director of HM Sampoerna Ivan Cahyadi, explained that the facility is equipped with a global standard testing and analysis laboratory, and is the main pillar in the strategy of developing smoke-free technology in Indonesia and becoming the first smoke-free tobacco product factory in Southeast Asia.

"We have invested in Indonesia, in Sampoerna, more than US$330 million for the development of smoke-free technology products in Indonesia. One of the main pillars is the production facility in Karawang, West Java," Ivan said at a Technovation event at the Park Hyatt Hotel, Wednesday, July 2.

He said that this facility became PMI's first smoke-free tobacco product factory in Southeast Asia and the seventh in the world.

Ivan said this is proof that Indonesia is not only an important market, but also a center of global excellence in the research and development of smoke-free tobacco products.

Ivan added that Indonesia became the first country in Southeast Asia to launch various IQOS smoke-free products, such as VEEV, ZYN, and BOUNDS.

He added that these products are not only sold in the domestic market, but have also been exported to 15 countries in the Asia Pacific region.

"We are the hub. Now that is what we always aspire to, that everything in Sampoerna is the ecosystem, starting from talent, products, it can not only be useful for Indonesian but can also contribute globally," he explained.

Ivan said that Sampoerna is committed to continuing to make innovations based on scientific research on smoke-free tobacco products that will be marketed.

According to him, this aims to provide better options for adult smokers who decide to continue using other tobacco/nicotin products.

In addition, he conveyed that Sampoerna also made a significant economic contribution, where the company absorbed tobacco harvests from 19,000 farmers, involved 1,700 local suppliers, and established partnerships with 1.5 million retail partners throughout Indonesia.

According to him, through the Sampoerna Retail Community (SRC) program, the company has fostered 250,000 stores and created 1,300 jobs.

Ivan said the economic impact of this initiative reached IDR 236 trillion, or equivalent to 11.4 percent of the Gross Domestic Product (GDP) in the national retail sector.

"The economic impact was recorded at Rp236 trillion or equivalent to 11.4 percent of the National Retail PDP," he added.

On the same occasion, Sampoerna's Head of Quality Nikolas Widhi Ananggadipa explained that Indonesia was chosen as the location for developing smoke-free tobacco products because it has superior tobacco quality and competent human resources.

He added that until now, the Sampoerna factory in Karawang involved around 200 experts from Indonesia who played a role in developing smoke-free products through the Advance Lab facility in the factory.

"The presence (of smoke-free product factories) in Indonesia, shows that PMI's recognition of the quality and human resources in Indonesia," he said.

He emphasized that all smoke-free products developed have met global quality standards with thousands of analyses and testing carried out annually, both for the domestic market and exports to more than 15 countries.

Furthermore, Nikolas revealed that Sampoerna also runs an expert exchange program with PMI where through this program, the best scientists from Indonesia were sent abroad to collaborate with other PMI affiliates in various research and development projects.

"This initiative confirms that Indonesian talents in advancing scientific innovation on an international scale are not just words," he concluded.

Meanwhile, PMI Senior Vice President External Affairs Christos Harpantidis said that innovation is not solely about creating new technologies, but a call to answer global challenges through responsible and contextual approaches.

He emphasized that innovations that are able to create real changes can only occur when synergized with unique characters and local market needs, and are supported by cross-sectoral collaboration.

That's why we invest in Indonesia not only because of its strategic scale, but because we see the potential for strong collaboration with stakeholders in realizing better changes. We believe, meaningful innovation is born from cooperation, not running alone," he said.