JAKARTA – Indonesia is seeking to further strengthen its downstream palm oil industries next year to increase exports, improve the welfare of smallholders, and further develop the renewable energy through the biodiesel 35 percent and biodiesel 40 percent (B35 and B40) production and consumption.

“Downstreaming will become one of our main sources of economic growth next year. Not only in mining , but in palm oil industries as well,” Finance Minister Sri Mulyani Indrawati said during a press conference on the state budget (RAPBN) 2025 in Jakarta on Friday (16/08/2024).

She is optimistic that export value of palm oil products can be maximized from the palm oil export tax and palm oil export levy.

The palm oil exports have shown a trend of positive performance since 2015, rising from US$16.8 billion (Rp264.86 trililion in 2015 to US$23.9 billion (Rp376.79 trillion) in 2023.

Sri Mulyani also stated that the government will continually try to stabilize the price of palm oil at an appropriate level to maintain the welfare of smallholders. “The government will also keep maintaining the availability and affordability of crude palm oil and dervivative products, including biodiesel, for consumers,” she said.

The distribution volume of biodiesel increased from 0.92 million kiloliters in 2015 to 2.24 million kiloliters in 2023. The biodiesel production and consumption had allowed Indonesia to reduce import of diesel fuel and save foreign exchange up to Rp3.7 trillion in 2015, which had been continually increased and reached Rp121.5 trillion last year.

Apparently, the biodiesel mandatory  program had not only saved foreign exchange, but also helped reduce carbon emissions at 2.4 million of carbon dioxide equivalent (CO2e) in 2015 and amounted to 32.7 million CO2e in 2023.

Previously, Minister Sri Mulyani said that the government will use the state budget (APBN) and fiscal policy to support the transformation of Indonesian economy, including its program of downstreaming. “Government support is, among others, in the form of infrastructure development, and various schemes of tax incentives to attract investments,” the minister said.

“The incentives are given in the forms of import tariff , tax allowance and tax holiday, which are particularly expected to push up downstreaming of industries. The downstreaming program will certainly create job opportunities with decent wages,” she said. (*)

Source: sawitku.id