Jokowi: Hope move to slash industrial gas prices helps economy

Jokowi: Hope move to slash industrial gas prices helps economy

President Joko Widodo.  (ANTARA FOTO/Akbar Nugroho Gumay/hp)

Jakarta (ANTARA) - President Joko Widodo (Jokowi) on Wednesday said he hoped the plan to reduce gas prices for industries would prove beneficial for the national economy.

"I also need to remind here that industries that get the incentive of reduced gas prices will need to be verified and evaluated, so that the incentive can later on provide added value and have a significant impact on our economy," Jokowi said at the Merdeka Palace in Jakarta on Wednesday.

He made the remarks during a limited meeting with Vice President Ma'ruf Amin and the cabinet ministers on 'Adjustment of Gas Prices for Industries and Non-Subsidized Fuel Oil’, which was carried out via video conference.

“We have discussed the price of gas for industries on January 6, and I have given three options that need to be weighed," the President said.

The first option would be to reduce, or even, eliminate the government quota; the second would involve the implementation of domestic market obligation (DMO), or domestic supply obligation; and, the third would entail freeing up gas imports for industry.

Industries that avail the incentive must be able to increase production capacity, the President said.


"Those industries should increase new investment, create more jobs, and also increase production efficiency, so that their products become more competitive," Jokowi stated.

The President also called for periodic evaluation and monitoring of industries that are granted the incentive.

Under Presidential Regulation No.40/2016, the price of gas for industrial needs will be set at US$6 per Million British Thermal Unit (MMBTU) from April 1, 2020.

Seven industrial sectors would be able to avail the incentive — fertilizer producers, petrochemical industries, oleochemical industries, steel industries, as well as ceramic, glass, and rubber gloves producers. (INE)

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