The Ministry of Industry partnered with the Indonesian young Entrepreneurs Association (HIPMI) in the discussion of the implementation of machinery restructuring program. “That’s one of the areas which could be worked together, because the machines rejuvenated are capital goods which can be used by small and medium industries,” said Industry Minister Saleh Husin after receiving the visit of chairman of Central Boards (BPP) of HIPMI, Bahlil Lahdahlia and HIPMI officials in Jakarta, on Monday (May 11).
Ministry the of Industry encouraged them to cultivate local raw materials-based industries to speed up downstreamization. So it is expected that business growth will be achieved accompanied by equitable distribution of industry in the regions. “Based on my visits to different regions, many potential local natural resources can be further processed, such as cocoa for chocolate and seaweed industry which is an export commodity,” said the Minister of Industry.
According to the Director General of Small and Medium Industries of the Ministry of Industry, Euis Saedah, her party has scheduled a discussion on machinery rejuvenation program. “Next week, we and our colleagues of HIPMI will discuss about machinery restructuring assistance that we offer them,” he said.
In the meeting, Chairman of BPP HIPMI, Bahlil Lahadalia, relevealed that young entrepreneurs in the regions should get the chance and opportunities in the development of investment in the regions. “More importantly, there is also a willingness of institutions, such as investment Coordinating Board, to involve national and local entrepreneurs to work together,” said Bahlil. The role of the entrepreneurs to work together,” business partner, aka sharing business ownership and operations as well as being a supplier ownership and operations as well as being a supplier of production activity.
In response, Euis said that local young entrepreneurs had a chance to pursue medium industries that process agro products and component industries. These two areas can become a partner for big industries. Industry Minister Saleh Husin also committed to encourage large investors, both foreign and domestic, that entered a region, to partner with young entrepreneurs, he is optimistic that young entrepreneurs are capable to become the spearhead for the strengthening and distribution of national industry.
Allocating IDR 100 Billion for Industrial Machinery/Equipment Restructuring in 2015.
The Ministry of Industry continues to develop the potential of the textile and textile product (TPT) industry, footwear, and leather tanning industries nationwide. One of the strategic efforts that have been made are implementing revitalization program and industrial growth through machinery/equipment restructuring. So it is expected to achieve increase in capacity, quality, efficiency, productivity, and competitiveness of the priority industry. This was conveyed by Minister of Industry Saleh Husin at the launching of Industrial Revitalization and Growth Program Through Restructuring of Machinery/Equipment of Textile and Textile Product Industry and Footwear Industry for Fiscal Year 2015 at the Ministry of Industry recently.
“Machinery/Equipment Restructuring Program has been implemented by the Ministry of Industry since 2007 for TPT industry, and in 2009 for the footwear and tannery industries. This industry and footwear industry, “said the Minister of Industry. In 2007 – 2014, budget that has been absorbed through this program reached IDR 1.18 trillion and has stimulated machinery/equipment investment activity carried out by the business community at IDR 14.48 trillion with productivity increase from 6 to 10%, energy efficiency from 5 to 9%, and absorption of 241,835 workers.
From the results of evaluation of TPT industry, footwear and leather tanning industries, the Ministry of Industry has proposed a budget for 2015 at IDR100 billion, with targets of achievement of value of investment made by TPT industry, footwear, and leather tanning industries at IDR 1 trillion or USD 80 million; creation of employment opportunities for 10,000 people for TPT industry, footwear, and leather tanning industries; as well as increased efficiency of energy use and production costs and producing higher quality and competitive products.
Meanwhile, taking into account the input of the Supreme Audit Agency (BPK) and the Development Finance Comptroller (BPKP), the Ministry of Industry has perfected the technical guidelines of the program for fiscal year 2015 as follows: prioritizing industry that never received funding program, so that the available budget can be used widely and evenly by all TPT and footwear industry; and to encourage the rejuvenation of machinery/equipment for the industry whose percentage of more than 20-year-old machinery/equipment reached 70%, so that the 2015 budget year is prioritized for industries who make investment in fabrics manufacturing (weaving and knitting machine).
TPT industry, footwear, and leather tanning industry is one of the strategic industry, given that its role in the contribution to foreign exchange earnings from non oil & gas exports and labor absorption reached 15.51% of the total manufacturing industry workforce as well as contributing to the national GDP at 1.89%. The export value of TPT industry in 2014 reached USD 9.13 billion or is still surplus compared to imports worth USD 5.8 billion. While, the footwear, leather tanning industry and finished leather goods industry also recorded a surplus with export value reaching USD 2.9 compared to imports valued at USD 0.9 billion. Besides its large contribution to foreign exchange earnings from exports, the priority industries also provide employment to 2.2 million people. (E)
Business New - May 15, 2015