VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

Indonesian President Joko Widodo instructed economic ministers in the Indonesian Cabinet to come up with policies that could reduce the value of iron and steel imports. The large amount of steel imports is one of the sources of Indonesia's trade balance deficit. Based on data from the Central Statistics Agency (BPS), the total value of Indonesia's iron and steel imports in 2019 reached 10.3 billion US dollars, up slightly from 2018 which touched 10.2 billion US dollars. With that much value, iron and steel are now the second largest imported commodity in Indonesia after electronic machinery and equipment. President Joko Widodo at the Presidential Office, Jakarta, Wednesday (Feb12) requested that the negative trend be immediately ended. If import policy continues to be opened up on a large scale, local steel mill utilities will never develop and the industry will not be able to progress. In fact, according to president Joko Widodo, the domestic industry has been able to produce some of the imported iron and steel.

Therefore, he urged the economic ministers to provide regulations that could encourage national iron and steel production, such as the provision of easier and cheaper raw materials. The President stressed that Indonesia needs to improve the ecosystem of supplying raw materials for the steel and iron industries, such as the availability and stability of raw material prices. According to the President, raw materials from national mining products can be prioritized in order to increase added value in the country. This is not only to reduce imports, it can also open jobs.

President's request, Minister of Industry Agus Gumiwang ensured that he would reduce imports of iron and steel raw materials. The move was taken to strengthen the competitiveness of national industrial production, so that Indonesia does not continuously depend on imported steel.

Of the total requirement of 14 million tons per year, the domestic scrap metal industry is only able to supply 5 million tons, so there are still around 9 million tons that must be imported from abroad. However, with the reason to protect the domestic metal scrap industry and reduce the import of hazardous and toxic waste materials, scrap metal imports are limited to only 5 million tons.