TEMPO.CO, Jakarta - The Indonesian Employers Association (Apindo) on Wednesday, in response to President Joko “Jokowi” Widodo’s bauxite export ban announcement, acknowledged the shift in industrial downstream orientation the government is moving towards.

Apindo general secretary Eddy Hussy spoke about the export ban that would be made effective starting on June 2023, which he said is meant to restrict raw exports of natural resources that are extracted domestically.

“The government’s orientation currently is toward industrial downstream that are based on natural resources,” said Hussy in a press conference at the Apindo headquarters in South Jakarta, on December 21. “That must be emphasized.”

In terms of raw minerals that have been banned from export apart from the latest bauxite, to date, include nickel, lead, and copper. Due to this, he added, the number of nickel smelters has grown in a myriad of regions such as Central Sulawesi, Southeast Sulawesi, and up to Halmahera in Maluku.

Meanwhile, the largest bauxite reserve the country currently has is located at the Bintan Island in the Riau Islands. “This might be the basis of why the government is pushing for the industrial downstream program,” said Eddy.

In contrast to Eddy, Apindo head of property and economic regions Sanny Iskandar called for the government to rethink the export ban and suggested exports of the mineral should continue but under stricter regulations such as imposing higher taxes.

“[Bauxite] exists currently in Bintan and West Kalimantan, and according to bauxite research, the one in Kalimantan is plentiful but the ones in Bintan are nearly depleting,” Sanny explained.

As reported on Wednesday, President Joko “Jokowi” Widodo made the announcement that he will officially ban the export of bauxite ore which will take effect on June 2023. The government justifies this decision following the nickel export ban that had been imposed since January 2020.

“I repeat. Starting on June 2023,” the President said in a press conference at the State Palace on December 21.

Parallel to the export ban, the President assures that the government will push the domestic bauxite processing and refining industry as he understands such a ban will cause nickel ore exports to drop significantly.

The President estimates that the industrialization of bauxite in the country will increase state revenue from Rp21 trillion to around Rp62 trillion. For this reason, he added, the government will continue to consistently carry out domestic downstreaming so that added value from bauxite processing will be felt domestically.

"For the progress and welfare of the people," Jokowi said in a press conference at the State Palace, Jakarta, Wednesday, December 21.

The bauxite export ban was announced after Indonesia imposed a nickel export ban two years prior, specifically on January 1, 2020. Jokowi claims this policy has increased the export value of nickel.

MOH KHORY ALFARIZI

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