Iron Steel Export Value Successfully Reached US$ 21 Billion

Iron Steel Production

Indonesia has significantly benefited after the export value of iron steel to foreign countries reached US$ 21 billion or around Rp 325.7 trillion. This was confirmed by the Coordinating Ministry for Maritime Affairs and Investment (Kemenko Marves).

Coordinating Minister for Maritime Affairs and Fisheries, Luhut Binsar Pandjaitan, stated that exports increased up to 10 times compared to export activities in 2013 – 2014 which only reached US$ 1.3 billion or Rp. 20.2 trillion.

The growing value of iron steel exports to foreign countries is because currently, Indonesia continues to increase the value of raw goods into value-added goods downstream.

“So this is what makes me thank China, no need to be ashamed, they really helped us and now 70% of our export increase is contributed from iron and steel production to US$ 21 billion,” said Luhut in the Launching of the Corporate CSR Activity Report. The Chinese company in Indonesia, Raffles Hotel, Jakarta, Friday (10/28/2022).

Luhut targets to increase the export value this year to reach around US$ 28 billion to US$ 29 billion.

In addition to discussing the export issue, Luhut stated that Chinese companies in Indonesia have been downstream using the best technology. In fact, Chinese companies said Luhut, also claimed to continue to transfer technology.

“Indeed, in the first 5 years, many employees of Chinese experts were criticized. But now in these 3 years, there are more and more Indonesian children who used to be nobody but now become operators there. Unbeknownst to us, education in Indonesia is developing well because of them. must improve the quality,” said Luhut.

Luhut never imagined that China has good technology and has high efficiency and an extraordinary spirit.

The most important thing, said Luhut, is that Chinese companies want to share technology and educate Indonesian children to know their technology.

On the other hand, Indonesia’s increasing exports should leave a trail of large foreign exchange reserves in the form of dollars.

In fact, the liquidity of the currency of Uncle Sam’s country is actually running low amid the ‘strong dollar’ phenomenon.

This is reflected in the rapid growth of foreign currency credit, but not accompanied by the collection of foreign currency third-party funds (DPK).
Bank Indonesia (BI) noted, in September 2022, credit growth grew in double digits or by 18.1%, while growth in foreign currency deposits only reached 8.4%.

In line with that, BI also estimates that foreign funds out of Indonesia or net outflows in the third quarter of 2022 are estimated to reach US$ 2.1 billion or equivalent to Rp. 32.55 trillion (exchange rate of Rp. 15,500/US$).

The limited supply of foreign currency was also acknowledged by the Senior Deputy Governor of Bank Indonesia (BI) Destry Damayanti during a BI press conference some time ago.

“Forex liquidity is limited, even though the trade balance is large. One thing is indeed somewhat different from previous periods,” said Destry.