Remarks of President of the Republic of Indonesia at the 50th Anniversary of Indonesian Young Entrepreneur Association at Jakarta Convention Centre, Special Capital Region of Jakarta, June 10, 2022
Assalamu’alaikum warahmatullahi wabarakatuh.
May peace be upon us all,
Greetings of virtue.
Distinguished founders of the Indonesian Young Entrepreneur Association (HIPMI) in attendance this afternoon and Chairpersons, from the first, Bapak Abdul Latief, Bapak Siswono Yudo Husodo, Bapak Aburizal Bakrie, Bapak Pontjo Sutowo, Bapak Agung Laksono, and distinguished current Chairperson of HIPMI Bapak H. Mardani Maming,
Distinguished supervisors of Central Management Board and all Provincial Management Boards of the HIPMI, Heads of Provincial Management Boards, and Heads of Regional Management Boards across the country,
Distinguished Ambassadors of friendly countries,
Distinguished Ministers of the Indonesia Onward Cabinet,
Ladies and Gentlemen.
Many people mentioned, “Continue, continue.” Be careful, this is a political year. You say, “Continue, continue,” I will be protested. It has already happened. First, a former Chairperson of HIPMI, Pak Minister of Investment said, “Because of this, this, this, continue.” The next day, even in less than a day, there was a big protest against me. I did not say that, but I got protested. Protest against Pak Bahlil (Minister of Investment) then. The same thing will happen. If I do not answer, HIPMI will be protested. Oh, not HIPMI, but I will. Be careful, once again it is a political year.
But I understand, what is expected to continue is the program. Whoever the leader is, the programs should be continued so that there is a continuity, sustainability. The next leaders should continue the programs carried out by the previous leader. It will be dangerous if they don’t. And if it continues to occur, it will be like starting over from kindergarten. We already entered junior high school, senior high school, then the leader changed, and we would start over from kindergarten. When will we graduate from university?
The current problem is not an easy one. All countries are experiencing the same thing, uncertainties. Do not let there be more uncertainties due to the general election and regional elections. We are now completely—I assure you that it gives all heads of states a headache. The issue with economic recovery due to the pandemic is not solved, not finished, then there is a war in Ukraine. Do not let there be more issues at home. We will tackle it together, agree? Because of the politics in 2024.
Be careful. The projection of economic growth has been decreased by the World Bank, especially in developing countries from 6.6 percent to 3.4 [percent] in 2022. A drastic drop. And thank God in the first quarter of this year, we could still grow by 5.01 percent. No G20 countries have seen a growth of 5.01 [percent].
Be careful with inflation, which has now become a specter for all countries. And although we have a slight increase [in prices], we can still maintain and control it. Take a look, there are countries whose inflation is above 70 percent. The United States’ inflation rate is usually only 1 percent, but this time it has reached 8.3 percent. This is a big problem for all countries.
It is estimated that 60 countries will experience financial and economic hardship, and it is estimated that they will become failed states if they cannot fix their economy immediately. This is what I need to remind us all. Do not feel like everything is normal when the situation is truly abnormal. This uncertainty. This is what we need to address.
The big problem is about two economic affairs. First, energy inflation. Second, food price surge. Be careful. Everything will cause inflation. All prices have increased. Natural gas [price] has surged by 153 percent, coal [price] has increased by 133 percent. But many are happy because of coal increase, I know that the Chairperson must be happy too. Mr. Ical must be happy too because the price of coal increased. Oil [price] rose by 58 percent. Oh right, Chairperson of the Indonesian Chamber of Commerce and Industry (Kadin) as well. Chairperson of the Kadin also has a lot of coal, Mr. Arsjad. Oil [price] rose by 58 percent. CPO [price] increased by 27 percent. Those who have oil palm business are also happy.
But be careful of other issues as well. We need to be vigilant of wheat, corn, soy price surges, which have increased by approximately 30 percent. It will impact everything. Wheat, because producers of 30-40 percent of [the world’s] wheat [supply] Ukraine and Russia are in conflict, the global price of wheat increases and noodle, bread, everything is made of wheat. Corn, seven years ago Indonesia we imported 3.5 million tons of corn. The latest data from the first quarter [of 2022] showed that our import dropped to 800,000 tons. It is a drastic decline, but we still have to solve the 800,000. Everyone who has land must plant corn so that we no longer import it. Soy [price] increased. If corn [price] increases, it will have impacts on everything, on animal feed, on egg price, on chicken/chicken meat price. Be careful with this. The same thing applies to soy. The price increased by 33 percent. It will also affect many things, such as tofu, tempeh. All prices increase and affect inflation.
This is what I need to remind you. Be careful of food issues, but it also becomes an opportunity for entrepreneurs, especially HIPMI members to enter these sectors. Food, energy are opportunities because it is estimated that today there are approximately 13 million people starving in several countries due to food issues.
And other countries have also limited, stopped food export. Be careful with this. If we cannot be independent in terms of food, it can jeopardize our country. The number of countries that have stopped food export has increased from three countries to 22 countries, thus, once again, food independence is essential.
I urge all HIPMI members to enter this sector. Plant corn. Profit, it will bring profit because corn price is good. Plant other food, sorghum that we never plant, plant sorghum, especially in East Nusa Tenggara province. We have test-planted 40 hectares of sorghum. It grew really well in East Nusa Tenggara. Konjac (porang) is the food of the future. Konjac, as it is gluten free, can be planted anywhere, and other plants that we have, sago, cassava, and many others. Moving forward, I assure you that because of a much bigger problem, namely climate change, food will be an issue for all countries.
Finally, about domestic product purchase. I have ordered all ministries, institutions, state-owned enterprises (SOEs), regions to buy domestic products. That is mandatory. Now we check it completely, monitor it completely, oversee it completely because our budget is huge, huge. State Budget, regional budgets, and SOE budgets are huge. Finally, now we take note of everything on a digital platform. Now we have a Rp825 trillion commitment, a commitment of all ministries and institutions.
If everyone buys domestic products, everything will progress. Small industries, small entrepreneurs, everything. We cannot let past occurrences happen again. We bought imported pipes for whatever reason although we could produce them on our own. No, it cannot happen now. Monitor it, we have a commitment. Therefore, we expect the policy to trigger domestic economic growth.
Once again, let me wish HIPMI a happy golden anniversary, 50th anniversary, and I am certain that the conglomerates in the year of Indonesia Emas 2045 (Golden Indonesia) are all HIPMI members. If you are now in your 20s, 30s, or 40s, you all will become conglomerates in 25 years when you are in your 50s, 60s, or 65s, ladies and gentlemen.
The estimate of our GDP has reached a very spectacular figure. [We can achieve it] as long as future leaders have consistency to decide although it is hard, as Minister of Investment has said, the issue of downstreaming. Do not be afraid to stop raw material exports. After we stop nickel [export] this year, we may stop bauxite [export]. Next year we may stop lead [export], the following year we may stop copper [export], and so on. Therefore, the added values will be at home and Indonesia will get institutional income tax, employee income tax, value-added tax, export duty, and all of it will strengthen our State Budget.
That concludes my statement on this auspicious occasion.
Happy 50th anniversary to HIPMI.
I thank you.
Wassalamu’alaikum warahmatullahi wabarakatuh.