Month: August 2024

The government is encouraging the expansion of non-traditional markets for Indonesian furniture products. This industrial sub-sector has high added value and actively provides a positive impact on the Indonesian economy. One of the efforts to open non-traditional markets is through active participation in the IndexPlus Delhi 2024 Exhibition, the leading and largest international platform in India, specifically for interiors, architecture and design which will take place on August 9-11, 2024.

“The value of business commitments successfully recorded from Indonesia’s participation in the exhibition is IDR 17 billion,” said the Director General of Agro Industry at the Ministry of Industry, Putu Juli Ardika, in a written statement, quoted on Thursday (8/15/2024).

In order to increase market control and respond to furniture industry trends, the government has developed a strategy that focuses on five things. First, facilitate the availability of raw materials. Second, facilitate the availability of skilled human resources. Third, facilitate market development and strengthen market reference research. Fourth, facilitate increased productivity, capacity, and product quality. Fifth, facilitating a conducive business climate and increasing investment

To create a conducive business climate for furniture industry players, the government has also issued a policy of providing tax incentive facilities in the form of tax allowances, as well as facilitating procedures for exporting downstream products and importing raw materials or auxiliary materials.

“All of these programs are a form of government support so that the domestic industry can be sovereign, advanced, and competitive,” explained Putu.

The gross domestic product (GDP) growth of the furniture industry in the first semester of 2024 was recorded at 0.50%. This is good news, considering that in the last 2 years this industry has contracted.

“In 2022, the growth of the furniture industry fell to 1.99%, then in 2023 it fell to 2.04%. However, in the first semester of 2024, there was a positive increase of 0.50%. Although prone to fluctuations, in 2021, the furniture industry managed to carve out growth of up to 8.16%,” said the Director General of Agro Industry.

In the first semester of 2024, furniture industry products including metal and plastic furniture contributed 1.1% to non-oil and gas GDP, with an export performance value reaching USD1.02 billion.

Based on Expert Market Research data, the global furniture market value in 2023 was recorded at US$629 billion, and in 2024 it is projected to grow by 5%. This condition opens up opportunities for the Indonesian furniture industry to penetrate the global market, one of which is India.

August 15, 2024, detikFinance

(https://finance.detik.com/industri/d-7492218/ri-bidik-pasar-mebel-di-india-siapkan-5-jurus-ini)

PT PLN (Persero) signed a Power Purchase Agreement (PPA) with a Saudi Arabian energy company, ACWA Power to develop the Saguling Floating Solar Power Plant (PLTS) project with a capacity of 92 Megawatt peak (MWp) in West Java.

The Saudi Arabian Ambassador to Indonesia, Faisal Bin Abdullah Al-Amudi, said that this EBT development cooperation is a bilateral relationship at a strategic level initiated by the leaders of Indonesia and Saudi Arabia. He assessed that this collaboration would improve the economies of both countries.

“The Kingdom of Saudi Arabia, as you know, is the largest economy in the Middle East and Indonesia is the largest economy in Southeast Asia. Both countries have great potential in terms of investment, on this occasion we also invite investors to increase investment in Saudi Arabia and Indonesia,” explained Faisal, in his statement, Thursday (15/8/2024).

PLN President Director Darmawan Prasodjo explained that this strategic step was taken by the company in its efforts to support increased utilization of new renewable energy (EBT) in line with the energy transition agenda in Indonesia.

“The earth is warming, and we are shifting from fossil fuel-based development to renewable energy-based development. The energy transition policy to renewable energy is underway and will be announced at COP29 in Azerbaijan with 75% of additional capacity coming from renewable energy,” said Darmawan.

Darmawan also said that with the large investment needs, of course PLN would not be able to do it alone. According to him, this is a global challenge that requires global solutions and global collaboration.

He said that the signing of this PPA is proof that the previously fragmented global community is now united.

“Global warming offers great challenges, but also provides extraordinary opportunities, opportunities to grow, opportunities to collaborate, both in strategy, technological innovation, and joint investment. We want to ensure that future generations have a better future than our generation. And it all starts through this extraordinary collaboration,” said Darmawan.

Darmawan said that later when the Saguling Floating PLTS, located in the Saguling Reservoir in West Java, operates, it has the potential to reduce carbon emissions by 120 thousand tons per year.

In this project, PLN Indonesia Power as a subholding of PT PLN (Persero) controls 51% of the shares and the rest will be owned by ACWA Power.

“We greatly appreciate ACWA Power for signing the PPA. This is just the beginning and is a symbol that opens up opportunities for much greater cooperation between Saudi Arabia and Indonesia,” continued Darmawan.

Meanwhile, Chief Executive Office of ACWA Power, Marco Arcelli said that Indonesia is a country with abundant green energy potential. As the largest private water desalination company in the world, ACWA Power emphasized its readiness to work with PLN to develop green energy in Indonesia.

“In countries with high population density, floating solar PV or ‘floatovoltaics’ serve as the best solution to utilize solar energy. Indonesia’s vast seascape and abundant sunlight present great potential for this project. We look forward to working with our partner, PLN, to contribute to the country’s vision of increasing renewable energy capacity,” explained Marco. ACWA Power is expanding its presence in Indonesia through strategic investments that contribute to economic growth and realize a sustainable future.

August 15, 2024, detikFinance

(https://finance.detik.com/energi/d-7491670/pln-gandeng-perusahaan-arab-saudi-kembangkan-plts-terapung-saguling)

The anode battery material factory in Kendal, Central Java, has just been inaugurated by President Joko Widodo (Jokowi). The factory was built directly by a Chinese company, PT BTR New Energy Material.

The factory that was inaugurated is the first phase of construction with a production of 80 thousand tons of anode material per year. The investment itself reached US$ 478 million or around IDR 7.72 trillion. With this factory, the downstream ecosystem of electric vehicles in Indonesia is claimed to have begun to materialize.

“So, what we dream of is a large ecosystem of strong and integrated electric vehicles one by one, starting to appear,” said Jokowi when inaugurating the battery material factory in Kendal, broadcast virtually, Wednesday (7/8/2024).

Here are 3 advantages of the anode factory:

1. Built in Only 10 Months

According to Jokowi, BTR from China was able to build the factory in a very short time. It was only 10 months ago that the investment commitment was signed in Beijing, but now the factory has been successfully built in Indonesia. Jokowi said that the speed of this development is proof of Indonesia’s progress. According to him, a fast country will currently beat a slow country.

“I really appreciate the speed of this factory’s construction. It was only 10 months ago that we signed in Beijing, and suddenly the factory was finished,” said Jokowi.

According to Coordinating Minister for the Economy Airlangga Hartarto, who was also present at the inauguration of the factory, in China alone there is no factory that can be built in 10 months. This shows Indonesia’s speed in making industrial progress.

2. Use High-Value Waste

Although currently there are still many goods imported for the manufacture of battery anodes in Kendal, he is sure that this factory can be a leap for industry in Indonesia. Jokowi explained that the natural graphite used in this factory is still imported from Africa, but artificial graphite can already be produced from the Pertamina refinery in Riau. These two materials can be used as anode materials to make batteries.

The anode material itself is the main component of the formation of lithium batteries. The anode material acts as the negative axis in a battery, while the positive axis is the cathode. The cathode itself can be produced from nickel processing that has been carried out in Indonesia.

With the existence of a factory that produces anodes, if Indonesia wants to make a battery, it currently only lacks lithium. Lithium material itself can be imported from Australia. Then Indonesia also already has nickel that can be used as a cathode and precursor.

For information, artificial graphite is obtained from the processing of petroleum coke, which is a by-product of crude oil processing, you could say that petroleum coke is waste that has high value. Petroleum coke that is converted into artificial graphite is obtained directly from petroleum processing at the Pertamina Dumai Refinery, Riau.

3. Could Be 1.5 Million Electric Cars

According to Jokowi, the production of 80 thousand tons of anodes per year can be converted into around 1.5 million electric cars. If the PT BTR factory can operate fully, its production can reach 160 thousand tons of anodes, meaning that Indonesia can convert 3 million electric cars per year.   

August 8, 2024, detikFinance

(https://finance.detik.com/industri/d-7478657/3-kelebihan-pabrik-anoda-china-di-kendal-yang-diresmikan-jokowi)

Coordinating Minister for Economic Affairs Airlangga Hartarto revealed that the investment flow into the Kendal Special Economic Zone (SEZ) has reached IDR 205.2 trillion and the absorption of workers has reached 132,777 people.

“From the SEZ there are 12 industrial SEZs including the Kendal SEZ and yesterday the president’s direction was that we will create a SEZ in Batang,” said Airlangga, Wednesday (7/8/2024).

With the presence of the Kendal SEZ, Airlangga said that growth in Kendal has reached 42% and per capita income there has reached 52 million per year with a growth of 8%.

Today, Wednesday (7/7/2024), Indonesian President Joko Widodo (Jokowi) inaugurated the lithium battery anode material factory owned by PT Indonesia BTR New Energy Material, in Kendal, East Java.

The existence of this factory will make Indonesia the largest anode producer in the world. Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan said that the investment of PT Indonesia BTR New Energy material is able to make Indonesia the largest Anode producer in the world.

“The capacity of 80 thousand tons is capable, enough to produce 1.5 million electric cars, they will make phase II which is targeted to be completed in March 2025, so that the total production is 160 thousand tons,” he said.

“With this capacity, Indonesia will become the second largest (producer) in the world, the factory in Japan has a capacity of 10 thousand tons, South Korea 40 thousand tons, the largest in China 100 thousand tons, so we will pass China in the future,” said Luhut.

August 7, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20240807122432-4-561086/SEZ-kendal-serap-investasi-rp-205-triliun-di-semester-i-2024)

Minister of Trade Zulkifli Hasan alias Zulhas together with Secretary General of the Gulf Cooperation Council (GCC) Jasem Mohamed AI Budaiwi officially launched the Indonesia-Gulf Cooperation Council Free Trade Agreement (I-GCC FTA) Negotiations. The launch of these negotiations was marked by the signing of the Joint Statement on The Launching of The Negotiation on The Free Trade Agreement between The Republic of Indonesia and The Gulf Cooperation Council at the Ministry of Trade Office on Wednesday, (31/7/2024).

“I am very happy today, even though we have not succeeded (in completing the agreement) but we have started (negotiations). I once again express my highest appreciation for the arrival of His Excellency the Secretary General of the GCC,” said Zulhas in his remarks.

“From the bottom of my heart, I sincerely invite us together, there are Ambassadors (of GCC countries) and His Excellency (Secretary General of the GCC), to immediately complete one that can increase our trade in this agreement,” he explained again.

Zulhas said that so far Indonesia and the Arab countries that are members of the GCC have had a long historical relationship, but minimal cooperation. Therefore, this agreement is considered to be a new step for both parties to be closer.

“We have a long historical relationship, but the trade relationship is minimal. During my two years as Minister of Trade, I have been to Saudi Arabia 5-6 times, 5 times to the UAE, 2 times to Qatar, Oman and Bahrain have not, Kuwait has not. But I really want us to strengthen and expand our trade relations,” he said.

He said that this cooperation could later have a good impact on both parties, because both Indonesia and the GCC have very large economies.

In line with that, Jasem Mohamed AI Budaiwi said that the newly signed I-GCC FTA agreement could have a positive economic impact on both parties.

“This is a very historic day for Indonesia and the Gulf countries (GCC), where we have signed a trade agreement between the two countries. Your Excellency, the Minister, with this agreement, it can bring goodness to both countries, especially in the economic sector,” he said.

“(Through this negotiation agreement) We from the GCC and Indonesia will discuss important matters together. There are several things that we want to convey, including trade in goods, trade in services, customs, Islamic economics. We want to underline that this trade agreement emphasizes Islamic economics,” explained the GCC Secretary General again.

For information, the GCC is an economic and political cooperation alliance consisting of six countries, namely Saudi Arabia, the United Arab Emirates, Kuwait, Bahrain, Oman, and Qatar.

Meanwhile, in the January-May 2024 period, total trade between Indonesia and the GCC had reached US$ 6.2 billion. Of that amount, Indonesia’s exports to the GCC were recorded at US$ 2.7 billion, while Indonesia’s imports from the GCC reached US$ 3.5 billion. In 2023, total trade between Indonesia and the GCC reached US$ 15.7 billion. Of that amount, Indonesia’s export value was recorded at US$ 6.1 billion, where Indonesia’s main export commodities include cars and motor vehicles, palm oil, jewelry, lightships, paper, and uncoated cardboard. Indonesia’s imports were recorded at US$ 9.6 billion, with the main non-oil and gas import commodities including semi-finished products from iron or non-alloy steel, acyclic alcohol, sulfur, polymers from ethylene, and unwrought aluminum.

July 31, 2024, detikFinance

(https://finance.detik.com/berita-ekonomi-bisnis/d-7466802/sah-ri-teken-perjanjian-kerja-sama-dagang-dengan-6-negara-arab)

The Ministry of Investment or the Investment Coordinating Board (BKPM) reported that investment realization throughout the first semester of 2024 had reached IDR 829.9 trillion or increased by 22.3% (yoy) from last year. According to BKPM, this realization has reached 67% of the total Renstra target of IDR 1,239.3 trillion and 50.3% of President Joko Widodo’s target of IDR 1,650 trillion. With this realization, the absorption of the workforce reached 1,225,042 people. Of the total realization of IDR 829.9 trillion, 50.8% or IDR 421.7 trillion was foreign capital participation (PMA) and the remaining IDR 408.2 trillion or 49.2% was domestic capital participation (PMDN).

In the first semester of 2024, PMA increased by 16.1% annually and PMDN also increased higher, namely 29.4%. Geographically, as much as IDR 413.7 trillion or 49.8% of investment in the first semester flowed to Java. The remaining IDR 416.2 trillion or 50.2% went outside Java. Both Java and outside Java experienced an increase in investment realization, by 27.8% and 17.3% respectively.

PMDN in the first semester was still dominated by the transportation, warehouse and telecommunications and mining sectors, which reached IDR 59.9 trillion and IDR 53.4 trillion respectively. Then followed by housing, industrial areas and offices of IDR 36.6 trillion and trade and repairs of IDR 35 trillion. The fifth position is the food industry of IDR 33 trillion.

Meanwhile, PMA flowed a lot into the basic metal industry sector, metal goods, not machinery and equipment of US$ 7.1 billion and mining of US$ 2.3 billion. The third position is transportation, warehouse and telecommunications and mining of US$ 2 billion and the fourth is the chemical and pharmaceutical industry of US$ 1.9 billion. The fifth position is occupied by the paper and printing industry with US$ 1.8 billion.

In terms of location, in the first semester of 2024, the largest PMDN entered DKI Jakarta and West Java, namely IDR 69.3 trillion and IDR 49.2 trillion respectively. Furthermore, the third position is East Java with IDR 44.1 trillion and the fourth, Riau with IDR 40.3 trillion. Finally, the fifth is East Kalimantan with IDR 24.4 trillion.

Then, the largest PMA in the first semester of 2024 flowed to West Java with US$ 5.3 billion and Central Sulawesi with US$ 3.9 billion. The third position is DKI Jakarta with US$ 3.4 billion and the fourth position, North Maluku with US$ 2.8 billion. The fifth position is occupied by Banten with US$ 2.4 billion.

In terms of investment country of origin, Singapore is in first position with US$ 8.9 billion, followed by China with US$ 3.9 billion and Hong Kong with 3.8 billion. Meanwhile, the United States is in fourth place with US$ 2 billion and fifth, Japan with US$ 1.8 billion.

July 29, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/news/20240729104401-4-558379/bkpm-lapor-realisasi-investasi-tembus-rp830-t-di-semester-i-2024)

Indonesia has successfully risen two ranks to 12th place in the Top Manufacturing Countries by Value Added released by the World Bank. According to Minister of Industry Agus Gumiwang Kartasasmita, this shows that the domestic manufacturing sector is still growing positively.

“There is quite encouraging data released by the World Bank, namely that in 2023 Indonesia managed to enter the 12th position in the Top Manufacturing Countries by Value Added in the world, with a Manufacturing Value Added (MVA) value of US$ 255 billion,” he said in his statement written on Thursday (25/7/2024).

According to the Minister of Industry, Indonesia’s position is far superior to other ASEAN countries such as Thailand and Vietnam. The two countries’ MVA values ​​are only half of Indonesia’s MVA value.

“At the global level, Thailand’s MVA is in 22nd position with a value of US$ 128 billion, while Vietnam is in 24th position with a value of US$ 102 billion,” he said.

Indonesia’s MVA value in 2023 increased by 36.4 percent (or US$ 68 billion) from 2022 which reached US$ 187 billion. “This raises Indonesia’s ranking from 14th in the world in 2022 to 12th in 2023,” he added.

The Minister of Industry stated that the manufacturing structure that has been owned in the country is much deeper and more evenly distributed so that it has greater added value than other competing countries in ASEAN or the world.

“To maintain or improve this achievement, there is only one key, namely the manufacturing industry must continuously strive to strengthen competitiveness,” he said.

The Minister of Industry added that based on the results of his working visit to attend the Hannover Messe 2024 event in Germany some time ago, the German Chancellor and the President of the European Union on that occasion conveyed the importance for a country to be able to create value (value creation).

“So, they both said that only countries that are able to create value will win in global manufacturing competition, including global economic competition. For that, we must quickly explore existing opportunities, one of which is by strengthening the role and exploring the potential for developing industrial services for the manufacturing sector in Indonesia,” he explained.

Based on Government Regulation (PP) Number 14 of 2015 concerning the National Industrial Development Master Plan (RIPIN) for 2015-2035, industrial services are one of the supporting sectors in building the national industry. So far, industrial services have played a strategic role as an enabler for industrial development effectively, efficiently, integrators, and comprehensively, and are able to support the activities of the processing industry sector and other sectors to contribute to the National GDP.

Economist from Brawijaya University Wildan Syafitri said that this achievement deserves to be appreciated because it is a positive achievement considering that in a crisis situation, Indonesia can actually increase the efficiency of the manufacturing industry. The latest data on the performance of the manufacturing industry sector also shows positive figures. The non-oil and gas processing industry sector in the first quarter of 2024 became the largest contributor to the national Gross Domestic Product (GDP), namely 17.47 percent with a growth of 4.64 percent and providing the largest tax revenue of up to 26%. On the export side, the value of shipments of non-oil and gas processing industry products in the first semester of 2024 reached 91.65 billion US dollars or equivalent to 73.27% of total national exports, with the absorption of 18.82 million workers. In addition, the realization of investment in the manufacturing industry sector in the same period reached 38.73%, with a value of IDR 155.5 trillion.

July 25, 2024, detikFinance

(https://finance.detik.com/industri/d-7456753/top-nilai-tambah-manufaktur-ri-kalahkan-thailand-dan-vietnam)

President of the Republic of Indonesia Joko Widodo launched the Indonesian Golden Visa in a ceremony at The Ritz-Carlton Hotel, Jakarta, Thursday (25/7/2024). In his remarks, Jokowi said that currently there are not many countries that have good economic growth, maintained political stability, as well as demographic bonuses and abundant natural resources.

“This means that Indonesia should be able to become a promising investment destination, a destination for global talents to work. All of that will provide a big multiplier effect for the country. Starting from capital gains, job opportunities, technology transfer, improving the quality of human resources, and so on,” he said.

Therefore, according to Jokowi, today the government is launching the Golden Visa service. The goal is to make it easier for foreigners to invest and work in Indonesia. Jokowi warned that the Golden Visa should only be given to good quality travelers. So, it must be truly selective, truly selected, and its contribution must be truly seen.

The head of state also hopes that the Indonesian Golden Visa facility will be immediately disseminated and socialized. Do it massively through various channels so that it can reach more top investors and top global talents.

“In addition, I also hope that the ambassadors of friendly countries can convey information about this policy to the people in their respective countries to increase economic cooperation and become a glue for friendship between countries,” said Jokowi.

For the record, the Golden Visa service is stated in the Regulation of the Minister of Law and Human Rights (Permenkumham) Number 22 of 2023 concerning Visas and Residence Permits and the Regulation of the Minister of Finance Number 82 of 2023 which was promulgated on August 30, 2023. This visa classification is intended for qualified foreigners who will benefit the development of the country’s economy, one of which is investors, both corporate and individual.

“A golden visa is a visa that is given as a basis for granting a residence permit for a period of 5 to 10 years in order to support the national economy,” said the Director General of Immigration of the Ministry of Law and Human Rights, Silmy Karim in his press statement, Sunday (3/09/2023), as reported by detik.com.

To be able to live in Indonesia for 5 years, foreign individual investors who will establish a company in Indonesia are required to invest US$ 2.5 million (around IDR 38 billion). Meanwhile, for a 10-year stay, the required investment value is US$ 5 million (around IDR 76 billion).

Meanwhile, corporate investors who form a company in Indonesia and invest US$ 25 million or around IDR 380 billion will receive a Golden Visa with a 5-year stay for their directors and commissioners. For an investment value of US$ 50 million, a 10-year stay will be given.

“Different provisions apply to individual foreign investors who do not intend to establish a company in Indonesia,” he said.

For a 5-year Golden Visa, applicants are required to place funds worth US$ 350 thousand (around IDR 5.3 billion) which can be used to buy Indonesian government bonds, shares of public companies or savings/deposits. While for a 10-year Golden Visa, the funds that must be placed are US$ 700 thousand (around IDR 10.6 billion).

“Because we are targeting quality travelers, the requirements are more stringent. The longer you stay in Indonesia, the higher the value of the guarantee, especially for investment activities which can be up to around IDR 760 billion,” he added.

July 25, 2024, CNBC Indonesia

(https://www.cnbcindonesia.com/lifestyle/20240725112403-33-557512/jokowi-luncurkan-golden-visa-beri-kemudahan-wna-berinvestasi-di-ri)