The petro-chemicals
industry has been notably growing, the benefit was not only felt in the
strengthening of the supply chain from upstream to downstream but also for the
growth of national economy, i.e. as forex maker and employment agent. The
petrochemicals industry was one of the basic industry being developed over the
past 3 years. Beside petro chemicals there were some important basic industries
on the priority list of development, i.e. steel industry, metal industry and
other upstream industries.
The Minister of Industry MS Hidayat stated on Friday [25/10]
stated that the petrochemicals industry was an industry to be prioritized. This
industry could suppress import of raw materials so domestic need for raw
materials could be fulfilled by Indonesia based companies. He supported the
policy of giving incentives like tax allowance which would enhance growth in
industry. “This is an important industry so we prioritize the development,”
Hidayat said.
Furthermore the Ministry of Industry continued, by next
year machineries for textile and manufacturing could be produced in Indonesia,
so import would be needed. The Ministry of Industry urged national
petro-chemical industry to use domestic resources.
Hidayat felt that the upstream industry must be prioritized
because it could minimize import of raw materials. The Government had building
basic industry since 3 years ago. He predicted growth of non oil gas industry
by end of 2013 would reach 6% - 6.5%; one of the factors which started industry
growth was building of factories like cement factories, steel and
petrochemicals.
Hidayat appreciated PT Nippon Shukobai Indonesia [NSI]
who had increased their investment. Additional investment by PT NSI as producer
of petrochemicals amounting to USD 332 would strengthen petrochemicals industry
in Indonesia. He stressed that Indonesia’s economic structure would be stronger
with investment of that magnitude. Moreover, he said, petrochemicals was one of
development. The industrial expansion included acrylic acid factory, with
increased capacity of 80,000 tons. So production capacity became 140,000 tons
placing it as one of the biggest acrylic acid production centers in Southeast
Asia. Minister Hidayat also remarked that this investment signaled bettered
investment climate in Indonesia.
Meanwhile Vice Chairman of the Indonesian Olefin Aromatic
Plastic Industry Association [Inaplas], Suhat Miyarso in Jakarta [Friday
25/10/2013] disclosed that the national petro-chemical industry was still
imbalanced as downstream industry was not balanced by growth of the upstream
industry, resulting in uncontrolled import. In 2012 the downstream
petrochemical industry grew by 11% while the upstream industry grew by 4%. By
end of 2013, the downstream industry was predicted to grow by 4% and the
upstream industry would grow by around 4%.
Suhat
said that imbalance of growth made the downstream industry like the plastic
industry to import their raw materials to keep production rolling. Dependency
on import content would swell if the upstream industry did not okay catch up
with the downstream industry. Suhat was also aware that expansion in the
upstream sector was hard to be exercised due to limited supply of nafta from
Indonesian factories. Therefore the plan to build three factories at the capacity
of 300,000 barrels per day was most urgent and indispensable.
Business News - October 30, 2013
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