Jakarta (ANTARA) - Minister of Investment and Head of the Indonesian Investment Coordinating Board (BKPM) Bahlil Lahadalia has asked the International Monetary Fund (IMF) to not interfere with Indonesia’s policies on downstreaming and banning commodity exports.

The Indonesian Government appreciates the IMF sharing its views and recommendations regarding macroeconomic growth in the country, Lahadalia said at a press conference in Jakarta on Friday.

However, the IMF can be said to be applying a double standard, since, on the one hand, it is supporting downstreaming goals, but on the other, it is opposing the export ban, he added.

"This is a double standard in my opinion; in my opinion, what the government is doing is on the right track, and we respect them, their views, but we should not be influenced by their views when it is not objective in the direction of the country's goals. Those who know the country's goals are our own country, the government of the Republic of Indonesia, and the people, nothing else," Lahadalia affirmed.

The IMF's assessment of the loss that the Indonesian Government will incur if it implements the export ban policy is not correct, he said. According to him, downstreaming would generate high added value for Indonesia.

He gave the example of nickel exports, which, in 2017–2018, were valued at just US$3.3 million. However, in 2022, after nickel exports were halted and downstreaming operations carried out, the export value touched nearly US$30 billion.

Furthermore, downstreaming has led to Indonesia recording a trade balance surplus for 25 consecutive months. In addition, in the past four years—ever since the implementation of the downstreaming policy—the annual growth of the workforce in the downstream sector has reached 26.9 percent.

"So, if anyone tries to say that downstreaming is an act that is detrimental to the state, we will ask what the thinking is behind it," said Lahadalia.

He emphasized that downstreaming and the commodity export ban will still be carried out by Indonesia. According to him, downstreaming is not just a matter of adding value, but is also related to maintaining the sovereignty of the Republic of Indonesia.

"Downstreaming concerns sovereignty, our country should not be regulated by other countries, other institutions may not judge us as good and there should not be double standards in the context of a country's policies," the minister said.

The IMF's views regarding the export ban policy have been outlined in a report entitled IMF Executive Board Concludes 2023 Article IV Consultation with Indonesia, which was published on Monday (June 26, 2023).

The Investment Ministry/BKPM highlighted three points from the report: that the IMF recognizes economic growth of above 5 percent in Indonesia, it acknowledges that Indonesia’s foreign domestic investment (FDI) will continue to increase and grow by around 19 percent, and it supports Indonesia's downstreaming goals to encourage structural transformation and create added value, but is opposed to the export ban policy.

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Translator: Maria Cicilia Galuh, Cindy Frishanti Octavia
Editor: Rahmad Nasution
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