Impressive achievements by Indonesia this year were shown with the economic growth supported by increased domestic demand, state income, and export performance that led Indonesia to become one of the countries included in the Seven Economic Wonders of Worried World released by Financial Times magazine. It cannot be separated from the role of the agricultural sector which is the lever of national economic performance with a contribution to GDP of 12.98%. One of the crucial roles of the agricultural sector is supported by the performance of the plantation sub-sector as the main contributor with a share of agricultural GDP up to 27%. Therefore, the government seeks to optimize the plantation sub-sector through various steps to encourage agricultural performance that has an impact on the national economy. One of the steps taken by the government is downstream which aims to increase the added value and competitiveness of commodities.
Downstream carried out by the government was able to increase the export value of several commodities, such as palm oil grew by USD 28.52 billion in 2021, and iron and steel grew by USD 21.47 billion in 2021. “Downstream can create jobs, create added value, increase foreign exchange, and create a positive trade balance. If we do not move downstream, the value will not increase. Therefore, the downstream of various commodities must be encouraged,” said Coordinating Minister of Economic Affairs Airlangga Hartarto during his keynote speech at the National Seminar on the Role of Standardization and Productivity of Plantation Commodity Products in the Framework of Increasing National Export Value, Thursday (29/9/2022). Airlangga said the government had prepared financing assistance through the People’s Business Credit (KUR) which has a ceiling of IDR 373.17 trillion in 2022. The government will increase the KUR ceiling to IDR 470 trillion in 2023. He explained that the use of KUR can be a long-term investment option for agricultural sector actors, particularly for palm oil commodities. “In the agricultural sector, KUR has been given IDR 70 trillion and it could increase. Because there is no limit for the agricultural sector. The government is also trying to encourage KUR for groups whose implementation has not been optimal,” said Airlangga. He added that the availability of rice is at a safe level to meet domestic needs with production achievements of up to 31 million tons in the last three years. Because of that, Indonesia was successful in obtaining an award from the International Rice Research Institute (IRR) during a pandemic situation and food crisis that occurred in various countries.
Airlangga invited various parties (both corporations and local governments) to be able to encourage the progress of various other commodities. The trick is to aggressively promote and market the products produced. Thus, it can encourage the welfare of farmers. n addition to Deputy II of the Coordinating Ministry for the Economy, the event was attended by the Chairman of the Standing Committee for Standardization and Productivity of the Indonesian Chamber of Commerce and Industry, who also serves as Chair of the Plantation Commodity Council Communication Forum (FKDKP). Also Deputy Chairperson of the Indonesian Chamber of Commerce and Industry for Industry, Deputy General Chairperson of the Indonesian Coffee Exporters Association, and the President Director of the Indonesian Classification Bureau (Persero).
