Gov’t to Slash Energy, Raw Material Imports

President Joko “Jokowi” Widodo accompanied by VP Ma’ruf Amin, Minister of National Development Planning (PPN)/Head of the National Development Planning Agency (Bappenas), and Minister of Home Affairs, opens the National Development Planning Conference (Musrenbangnas) National Medium-Term Development Plan (RPJMN) 2020-2024 at the State Palace, Jakarta, Monday (12/16). (Photo by: AGUNG / PR)

In a bid to narrow down the current account deficit, the Government deems it necessary to cut energy and raw material imports.

“The country’s oil import reaches 800 thousand barrels per day, including oil and gas. The import of petrochemical derivative products also contributes to the deficit,” President Jokowi said in his introductory remarks at the Opening of National Development Planning Conference and the National Medium-Term Development Plan (RPJMN) for 2020-2024 at the State Palace, Jakarta, Monday (16/12).

According to the President, coals can be converted into syngas which can be used to produce dimethylether, a substitute for liquefied petroleum gas (LPG) so the country does not need to import LPG.

The President went on to say that Indonesia can also drill many wells to jack up its oil production. “This is not right. We still import Aviation Turbine Fuel (avtur) while Crude Palm Oil (CPO) can be utilized,” he said.

According to the President, economic transformation in the country has stalled due to its dependence on imports, adding that Indonesia does not have to import nickel, bauxite, and coal as the country exports them in the form of raw materials.

“The target to convert raw materials into finished products in the next three years has to be met,” he said.

For that reason, the President asked for assistance from regional governments so that the country can overcome the current account deficit. “This is our target. If we can build oil refineries, there will be a lot of derivative products and we can cut petrochemicals import which cost at Rp323 trillion,” he added.

On that occasion, President Jokowi said that oil refineries were planned to be built immediately. “However, up to this moment out of the five that we want to work on, none of which are running already,” he said, adding he has instructed the Indonesian National Police Chief and the Corruption Eradication Commission (KPK) to oversee the construction of oil refineries.

“Regional governments should also be encouraged to facilitate the process of land acquisition and licensing,” the President said.

For the record, the Government has stepped up efforts to curb exports of nickel ore and other minerals.  Indonesia will defend itself as the European Union (EU) lodged a complaint to the World Trade Organization (WTO) to challenge Indonesia’s nickel ore ban.  (MAY/AGG/ES)

Translated by: Syarifah Aisyah
Reviewed by: Muhardi
Proofread by: M. Ersan Pamungkas