LPEI Channel Export Financing To Export Atsiri Oil Exporters

Riyani Tirtoso, LPEI Executive Director. (photo: twitter @Eximbank_ID)

JAKARTA - The Indonesian Export Financing Agency (LPEI) as a Special Mission Vehicle under the auspices of the Indonesian Ministry of Finance is committed to supporting the fulfillment of world electricity oil needs by encouraging this fragrant oil exporter to continue to grow.

LPEI's efforts include distributing export financing to national oil exporters, including PT Indesso Aroma (Indesso). In addition, LPEI also supports the pharmaceutical industry, cosmetics and herbal medicine producers, as well as health and fitness business actors to further develop innovations from products made from essential oil to be more competitive.

Indonesia, which has a wealth of atsiri oil, ranks 6th as the largest exporter of attractive oil in the world. Indonesia's exports of Indonesian electricity in 2021 reached US$248.4 million, up 15.09 percent year on year (yoy) from 2020 of US$215.8 million.

The five main destination countries for Indonesian oil exports in 2021 are AS (17.67 percent), India (16.75 percent), France (12.27 percent), Spain (10.29 percent) and the Netherlands (9.70 percent).

Based on data from the International Trade Center, the value of attractive oil exports reached 5.85 billion US dollars or grew 10.05 percent (yoy) until 2021.

Over the past five years (2017-2021), the world's attractive oil exports have increased by an average of 1.49 percent per year. Indonesia controlled an export market share of 4.25 percent in 2021 or reached 248.41 million US dollars. Five of the world's main exporters are: India, the United States, France, China, and Brazil.

The use of attractive oil is one of them as raw material for making aromatherapy. aromatherapy products are currently becoming popular because people are starting to look for a more natural way to improve and maintain health conditions, especially in the midst of the ongoing pandemic situation.

On the other hand, the development of the spa business in Indonesia and abroad as part of healthy lifestyle tourism expands the opportunity for the Indonesian oil export market to foreign countries.

The LPEI assistance program for atsiri oil farmers is also carried out in order to develop a variety of attractive oils that can be exported as alternative solutions for health, including: reducing stress and anxiety, reducing headaches, overcoming sleep difficulties, reducing inflammation due to insect bites and injuries caused by impacts, and overcoming skin problems.

"Through the foreign exchange village program and financing of the LPEI partnership program, we will also collaborate to increase creativity and productivity of atsiri oil farmers and suppliers," explained Riyani Tirtoso, Executive Director of LPEI.

The scheme that can be used is direct financing for fostered partners, including supply chain financing, or financing, not directly collaborating with channeling partners (banks, non-bank financial institutions, or LPEI customer development companies).

"LPEI is committed to continuing to encourage the export of Indonesian atsiri oil in the world's largest exporter through financing services, Consulting Services and Special Export Assignments (PKE) which touch export ecosystems from upstream to downstream," he concluded.