Players of the national steel industry were optimistic that steel business in Indonesia would grow in line with recovery of national economy. Global economy which was not fully recovered should be considered by national steel producers to shift attention to domestic market. The Indonesian Steel and Iron Association [IISIA] felt sure that the Jokowi-JK Government would spor on development of infra-structure to jack up Indonesia’s economic growth. IISIA was also expecting the next Government could be more firm in encouraging use of domestic Component [TKDN] for projects financed by the Government.
IISIA Executive Director Hidayat Trisepoetro stated on Monday [I/9] the Government must control circulation of illegal iron and steel products. He said that as the world steel market was not prospective, it was advisable for national steel producers to aim sales at the domestic market. Exploring the domestic steel market must be accompanied by stringent action in controlling steel importing among others by law enforcement to forbid imported steel products which was not SNI qualified and to abolish illegal practices in steel importing.
Hidayat disclosed that IISIA was encouraging steel producers to invest in the middle and downstream industry to fill in the vacuum in steel supply now filled by imported steel as domestic resources was unable to fulfill. IISIA data mentioned that so far domestic iron and steel production was only posted at around 7.2 million tons while national demand was nearly 10 million tons. Shortage of steel must be filled with imported steel. However Indonesia’s iron and steel production was predicated to increase up to 12 million tons in 2014 and 15 million tons in 2015 in line with growing demand for steel for infra-structure projects.
Therefore the Government was playing strategic role in strengthening competitiveness of the steel industry among others through simplification of regulation for raw material importing and permit applications. he further said that utility level of domestic iron and steel production today which was only around 60% could be increased. Vietnam was one of the countries in southeast Asia where growth of steel industry was notable. Indonesia as a vast archipelago and high population should be a potential market for Asia steel products as well as the world.
IISIA was insisting the Government to support the steel industry sector whereby to be able to compete in the ASEAN Economic Community [AEC] 2015. Hidayat stated that the execution of AEC 2015 would open opportunity for iron and steel producers in southeast Asia to enter Indonesia to compete against local products. To strengthen national steel industry and aim at the domestic market was most important for stepping up market was most important for stepping up market competitiveness.
The Government was asking the downstream steel industry not to be worried about the limited prohibition on boron importing. Harjanto, the Director General of Basic Manufacturing Industry, Ministry of Industry stated that the downstream steel industry which basically used boron needed not to worry about the restriction rule. Importing producers could still import provided they could submit documents on the import of boron needed. Soon the Government would survey whether imported boron steel were actually used or for resale. The Regulation was to protect domestic industry. (SS)
Business News - September 5, 2014