Remarks of President of the Republic of Indonesia at the Opening of the 12th Congress of the Veterans Legion of the Republic of Indonesia (LVRI) and the 11th National Conference of the Indonesian Veterans Wives Association (PIVERI), at Plaza Semanggi, Balai Sarbini, DKI Jakarta, October 11, 2022

By Office of Assistant to Deputy Cabinet Secretary for State Documents & Translation     Date 11 Oktober 2022
Category: Remarks @en
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Bismillahirrahmanirrahim.

Assalamu’alaikum warahmatullahi wabarakatuh,
Good morning,
May peace be upon us all,
Om Swastiastu,
Namo Buddhaya,
Greetings of Virtue.

Distinguished Bapak Try Sutrisno, the Sixth Vice President of the Republic of Indonesia;
Distinguished Bapak Major Gen. Syaiful Sulun, Chairperson of Veterans Legion of the Republic of Indonesia (LVRI) and Ibu Femmy Eman Lesar, Chairperson of Indonesian Veterans Wives Association (PIVERI);
Distinguished Ministers of the Indonesia Onward Cabinet who are present now; Pak Coordinating Minister for Political, Legal, and Security Affairs, Pak Minister of Defense, Bu Minister of Social Affairs;
Distinguished Chief of the Indonesian National Police (POLRI) and all personnel of the Indonesian National Defense Forces (TNI) and POLRI who are present now;
Distinguished Seniors; Bapak Broto and Ibu Ayani;
Ladies and Gentlemen.

First and foremost, we, the younger generation, would like to express our deepest gratitude and highest respect to the members of the Veterans Legion of the Republic of Indonesia all of the country who had fought for and defended the independence, and tirelessly continue to serve the motherland until today. Through all of your struggles and sacrifices, the Unitary State of the Republic of Indonesia stands tall. The Unitary State of the Republic of Indonesia continues to move forward based on Pancasila and the 1945 Constitution, and continues to work hard to realize the ideals of the founding fathers of the nation.

Ladies and Gentlemen,

The current situation is not an easy situation. A very, very difficult situation for all countries. International agencies say there are 66 countries in a vulnerable position to collapse. To date, there are 345 million people in 82 countries suffering from acute shortages and famine, meaning there is a food crisis.

This morning I got a call from Minister of Finance, from Washington D.C., and told me that 28 countries had already lined up for IMF debtors. I must convey the condition as it is. It means, the pandemic that hit all of these countries caused the global economy to collapse, with the addition of war between Russia and Ukraine, thus the food, energy, and financial crises are currently knocking door on all countries.

I met the President of Ukraine and the President of Russia, President Putin. In Kyiv, I talked with President Zelenskyy for about an hour and a half, then I talked for about two and a half hours with President Putin when I was in Moscow, Russia. Our hope is, in accordance with the mandate of the Constitution, to participate in maintaining world peace. But from the one-and-a-half plus two-and-a-half-hour conversation, I conclude that the war will not end in the near future. It is still a long way off and this is what causes global economic uncertainty.

Nevertheless, we should be grateful. Some European countries have started to plunge into recession. When winter sets in, they will find it difficult to get gas heater operated, it shows the conditions of countries around the globe are truly in a very difficult position. Inflation goes up, meaning that all prices go up but all economic growth falls, everything plummets, but thank God, in the second quarter, our country was still able to grow at 5.44 percent. This is economic growth is among the best in the world, because we continue to carry out fundamental things, structural reforms, bureaucratic reforms despite the pandemic.

Our food security, thank God, just three months ago we received a certificate from the International Rice Research Institute, which stated that Indonesia’s food security system is in a firm position and has achieved self-sufficiency since 2019. This is what we must continue to improve so that we can maintain food security in the country. If we can improve it, we can even use some of it to support other countries by exporting it since the situation is directly correlated with Russia-Ukraine war. Around 207 million tons of wheat halted in the two countries.

At that time, I asked President Zelenskyy on this issue and he promptly answered “we have 22 million tons of wheat in stock and we will harvest 55 million tons more in this month.” Means, there will be 77 million tons of wheat in Ukraine.

During a discussion with President Putin, he among other told me, “we have 130 million tons in stock.” Around 130 plus 77, means 207 million tons of wheat halted in both countries because of the war. It causes Africa and other countries of wheat consumers are all in a difficult position and the price is rising. We must realize such situation and be grateful for that we can manage food stocks in our country, we can control and maintain it well, both price stability and stock supply.

Furthermore, the most fundamental thing, which will provide good competitiveness for our country if we want to compete with other countries – which I have also often said on many occasions – is infrastructure. Without it, we cannot dream to be able to compete with other countries. This is why we build roads, airports, ports, dams, irrigation in massive manner, that in the future we will be well prepared in competing with other countries. This is a fundamental thing, although it may hurt at first, but in the next 5-10 years, the benefits of the infrastructure development we are doing today will be seen.

Downstreaming the industry, the third, is also included. I frequently told this in many occasions. During the 77 years of independence, we always export, whether nickel, copper, or palm oil, but not in the form of semi-finished or finished goods so that other countries have its added value and employment opportunities since they are the ones who process those raw materials. This is what we will consistently continue to do.

Three years ago we had stopped raw nickel exports already. We then faced lawsuit against European Union countries to the WTO and so far it has not been resolved yet. Because according to the rules, they say we cannot stop the exports. We are being sued. Yes, if we are sued and it make us afraid and do not dare to leap forward, we will revert to export raw goods. They may sue, we will face it. If we are sued, we can win or lose. If we lose, that is okay since we can submit for an appeal. This is what we will consistently continue to do. This year we will stop nickel export, next year we will stop lead export, the year after next we will stop copper export, so we can provide the added value here in our country.

I will give you one example, nickel. When we exported it in form of raw material, we merely pocketed Rp15 trillion, but when we exported it in form of semi-finished and finished goods, the export value reach to Rp360 trillion. From Rp15 trillion to Rp360 trillion, just for one commodity. As for copper, once the copper smelter plant in Gresik is ready to operate, we will also stop the export. No more copper export. We must manufacture it domestically so it can be semi-finished or finished goods.

I just went to Tembagapura to visit Freeport. I need to tell you, my seniors, that the majority share of Freeport now belongs to Indonesia, not to American companies anymore. Previously, we were only given 9.3 percent. We have been negotiating for three years, very tough one, and now we have a 51 percent shares. In the past, I did not want to go to Freeport since it did not belong to us, but now I go to Freeport for it is clear that that very site already belongs to our SOE, meaning it belongs to the Indonesian Government.

Also, when I was there, I am happy to observe that 98 percent of Indonesians are working, not foreigner as I heard before. And I am also happy for there are about 40 percent of the employees who are from Papua, the Papuan people. This is a technological transformation; this is an economic transformation that sometimes we are not aware of.

I only realized that after I went there, I realized that what we are doing is an economic transformation. If we consistently continue to do that without fear of being sued, our added value will significantly jump. Yesterday, I asked Minister of Finance, how much do we earn from Freeport? The answer is, previously we earned 9 percent dividends, now we earn 51 percent dividends, obviously we earn higher taxes, non-tax state revenues (PNBP), and export duties. After calculating from the income, 70 percent of it goes to the state, from previously a mere 9 percent dividend.

Also, Rokan Block. If Freeport has been managed by Freeport-McMoRan from America; Rokan Block, this is about oil and gas, has been managed by Chevron for 97 years. Now it is also 100 percent owned by us. I have not visited there yet, maybe in the next few months, I want to make sure if there is an increase in production and income from such takeovers. Nevertheless, I believe that now our youth, our human capital, I think they are ready for such a takeover.

This is what we will consistently continue to do so we can achieve the target of becoming big seven of GDP income in the world by 2030. When we reach Golden Indonesia, if our calculation is correct, we already hit the rank of fourth or fifth of global economy if we remain consistent. Whoever the President of this country, we must maintain the consistency not to go back to raw exports anymore. Please be careful and remind each other. We must remain though despite the likely approaching lawsuits. If lawsuits make us doubt our steps and we decide to withdraw, when else will we be able to enjoy the commodities and natural wealth owned by our country?

This concludes my statement on this auspicious occasion. By saying bismillahirrahmanirrahim, I officially open the XII Congress of the Veterans Legion of the Republic of Indonesia (LVRI) and the XI National Conference of the Indonesian Veterans Wives Association (PIVERI).

I thank you.

Wassalamu’alaikum warahmatullahi wabarakatuh.

(GWH/HD/MUR)

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