The Ministry of Industry (Kemenperin) is committed to encouraging the rubber processing industry sector to be more productive and competitive and diversify products by spur the rubber product downstream program. This is supported by Indonesia’s potential to become the second-largest natural rubber producer in the world.
Head of the Industrial Research and Development Agency (BPPI) of the Ministry of Industry, Doddy Rahadi, said the national rubber processing industry sector’s contribution to foreign exchange earnings reached US $ 3.422 billion in 2019. Currently, there are 163 natural rubber industries with direct employment of 60,000 people.
Doddy said natural rubber production in 2019 reached 3.3 million tons, including SIR (crumb rubber), concentrated latex, and RSS (ribbed smoked sheet). Domestic processing still needs to be optimized, which currently includes downstream products such as tires, retread rubber, footwear, rubber articles, and manufacture rubber goods (MRG).
The government also continues to strive to increase the price of natural rubber. This step is to boost the welfare of rubber farmers, rubber company income, and export value. “Increasing the absorption of raw materials by the domestic industry through the TKDN program and diversifying rubber derivative products could be an alternative effort that can be done,” said Doddy.
Other efforts that need to be taken, Doddy explained, for example, through international diplomacy with natural rubber producer and consumer countries in the International Tripartite Rubber Council (ITRC) and The Association of Natural Rubber Producing Countries (ANRPC).
According to Doddy, in 2019, three countries, namely Thailand, Indonesia, and Malaysia, which are members of the ITRC, agreed to implement the Agreed Export Tonnage Scheme (AETS) instrument to reduce natural rubber exports in order to increase the price of this commodity on the world market.
Furthermore, Doddy added, his party, through the Palembang Industrial Research and Standardization (Baristand Industri), is ready to support the downstream of natural rubber through research programs, innovation development, consulting, product quality assurance, and training on industrial technology transfer, especially Jambi and other rubber producing provinces.
Meanwhile, the Head of Baristand in Palembang, Syamdian added, that collaboration among stakeholders plays an important role in forming the natural rubber industry ecosystem. It can also support the formulation of strategic steps for downstream the rubber finished goods industry and provide proposals for synergy action plans to develop commodities and other potentials.
In fact, Bank Indonesia (BI) for Jambi Province welcomed the Jambi regional government’s plan and stated its commitment to help facilitate funding. BI will help facilitate funding through a regional commodity superior product assistance scheme. ***