Semen Indonesia: IKN Makes Cement Demand Soar To 21 Million Tons

Illustration. (Photo: Doc. Antara)

JAKARTA - PT Semen Indonesia (Persero) Tbk revealed that the construction of the National Capital City (IKN) of the Archipelago provides a potential demand (demand) of 21 million tons of cement.

"There is an opportunity from the IKN development which is estimated to provide a potential demand for national demand in 20 years amounting to 21 million tons of cement," said Semen Indonesia President Director Donny Arsal at a Hearing Meeting with Commission VI DPR RI in Jakarta, quoted from Antara, Tuesday, May 24.

Donny also added that another prospect comes from the budget allocation for infrastructure development which is still quite significant.

"In addition, the infrastructure budget allocation, although there has been a decline, is still quite significant, where this year is IDR 385 trillion," he said.

The prospect of cement in the future is also expected to be better, especially with a population growth of approximately 1 percent per year from 270 million people, we hope that demand will increase.

"From there, the current backlog of housing construction of 12.7 million units which we hope will also encourage national cement demand. This is in terms of the prospects for the cement industry in the future," said Donny.

The President Director of Semen Indonesia also explained the market conditions or the cement market in Indonesia when there was an oversupply.

"If we look at the current industry side as of December 31, 2021, the market condition is where the national capacity is 119.1 million tons, while cement demand is 65.2 million tons. Thus, there is an oversupply of 53.8 million tons. metric tons," said Donny.

Previously, the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan emphasized that the construction of the National Capital City (IKN) of the Archipelago had attracted the interest of many foreign investors.

Luhut also emphasized that it is not true that IKN development has minimal funding.

He underlined that the new capital city of the archipelago is intended for the younger generation who will enjoy it in the future. The shape will not be inferior to the modern city development of Neom in Saudi Arabia, Dubai in the United Arab Emirates, and Shenzhen in China.