The Ministry of Investment and Downstreaming/Investment Coordinating Board (BKPM) held an Expose of the 2024 Strategic Investment Downstreaming Study in Jakarta, on Monday, December 23, 2024 attended by 150 participants from relevant ministries and institutions, business associations and actors, academics, as well as heads of Investment and One-Stop Integrated Services (DPMPTSP) and heads of Regional Development Planning Agencies (Bappeda).
Secretary of the Ministry of Investment and Downstreaming/Principal Secretary of BKPM, Heldy Satrya Putera, said that the 2024 Strategic Investment Downstreaming Study is a follow-up to the Ministry of Investment and Downstreaming/BKPM which has previously compiled a Strategic Investment Downstreaming Roadmap in 2022 and 2023.
In 2024, the Ministry of Investment and Downstreaming/BKPM compiled three studies, namely the Strategic Investment Downstreaming Acceleration Study, the Strategic Investment Downstreaming Optimization Study, and the Downstreaming Impact Study.
The Acceleration Study captures the development of downstream investment from 28 commodities, one of which is Nickel which has two main downstream targets, namely stainless steel products and electric vehicle batteries.
“From this study, we can see the development of downstreaming, for example nickel downstreaming, which products have arrived. Because we have made nickel downstreaming with the concept of ecosystems, starting from the mine to the final product,” Heldy, who is also Acting Deputy for Strategic Investment Downstream, said as quoted in a statement on Thursday, December 26, 2024.
The second study is the Strategic Investment Downstream Optimization Study consisting of seven commodities, namely bauxite, Buton asphalt, petroleum, natural gas, biofuel, tuna-cakalang-tongkol, and seaweed.
“We also take pictures, record what problems (commodities) exist, so that we can optimize,” Heldy said.
The third study is related to the Downstream Impact Study which examines the economic, social, and environmental aspects of two main commodities, namely nickel and palm oil. This study explains that downstream commodities such as palm oil, which are often considered the main cause of deforestation, actually have a significant positive impact when viewed from various aspects such as fuel.
“So (palm oil) starting from the main, its products to the shell have all been utilized domestically,” he said.
For the economic aspect, the downstream impact of nickel commodities on the National Gross Domestic Product (GDP) is 0.45 percent. Meanwhile, the palm oil commodity contributed 0.23 percent to the national GDP. This figure, when accumulated, becomes 0.6-0.7 percent, which is quite significant from the total economic growth in the range of 5 percent.
Benefits
INDEF Senior Economist Didik J. Rachbini added that the Expose activity, which is a continuation of the Strategic Investment Downstreaming Roadmap, makes the direction of the strategic investment downstreaming policy become clear.
Didik assessed that there are at least five main aspects that can be the moves for the government to encourage the downstreaming of strategic investment including Market Driven, Productivity, Job Creation, Inclusivity and Sustainability.
“These moves are important to be implemented concretely in various ways,” he said.
The Strategic Investment Downstream Roadmap stipulated that investment needs in the downstream sector until 2040 were projected at US$618.1 billion, consisting of US$498.4 billion from the mineral and coal sector, US$68.3 billion from the oil and gas sector, and US$51.4 billion from the plantation, marine, fisheries and forestry sectors.
In addition, it is projected that there will be an increase in exports of US$857.9 billion, an increase in GDP of US$235.9 billion, and employment of approximately three million workers.
Based on data from the Ministry of Investment and Downstreaming/BKPM, the contribution of downstreaming to investment realization for the January-September 2024 period reached Rp272.91 trillion or equivalent to 21.6 percent of the total investment realization.
