Ministry of Industry Received Japanese Investment Commitment Up to IDR 40 Trillion and Pull Automotive Investment

The Ministry of Industry stated that a number of large scale industry players in Japan will bring their money into Indonesia to a total of Rp40 trillion by 2023. This investment commitment is good news which is expected to be realized quickly so as to be able to increase production capacity and strengthen the manufacturing structure in the country.

“We convey that in general the results of meetings with industry players in Japan are very productive. There are already several commitments for new investment and development (expansion), “said Industry Minister Agus Gumiwang Kartasasmita according to his statement received in Jakarta, Tuesday (11/19).

Minister of Industry held a one-on-one meeting in a marathon with eight corporations from the State of Sakura in Tokyo, Japan. These investors include Nippon Steel, Nippon Shokubai, AGC Inc. and Toyota Group directors.

Nippon Shokubai was ready to make a new investment of USD200 million for an acrylic acid plant with a capacity of 100,000 metric tons. At present, the production capacity of the Nippon Shokubai plant is 140,000 metric tons so that in November 2021 it will be 240,000 metric tons.

In addition, PT Asahimas Chemical, a subsidiary of AGC Inc. Japan, will also disburse funds worth Rp1.3 trillion for the expansion of the 7th phase factory in Cilegon, Banten. The investment is for the expansion of the 7th phase of the Polyvinyl Chloride (PVC) plant with a capacity of 200,000 metric tons per year. The plant is targeted for completion and commercialization in the first half of 2021.

Pull automotive investment

On the same occasion, Minister of Industry also held a meeting with a number of well-known Japanese automotive companies. This is in line with the implementation of the Making Indonesia 4.0 road map, which prioritizes the development of the domestic automotive industry in order to be more competitive globally.

“We have a report about the planned expansion of Toyota Group of Rp28.3 trillion. This includes the development of Toyota, Daihatsu and Hino, “he said. This investment will be realized in a period of five years, namely 2019-2023 to develop business in Indonesia.

In addition, Honda said it would realize an investment of Rp 5.1 trillion in the 2019-2023 periods in Indonesia. “The investment is for new models and industry deepening, localization and so on. Because indeed one of the positive values ​​of Honda is to place its research and development center in Indonesia, “said the Minister of Industry.

He explained that his party invited the investors to bring or build their R&D center in Indonesia. “We explain that there is PP regulation No 45/2019, which provides a super deduction tax facility. So, industries that build R&D will get a super deduction tax of 300%, “he said.

The Minister of Industry also expects Krakatau Nippon Steel Sumikin (Nippon Steel Group) to continue to increase the portion of local cold rolled steel, so that the domestic component level (TKDN) of the automotive sector increases while at the same time it can reduce imports.

“Our mission is to meet with Nippon Steel so that Krakatau Nippon Steel Sumikin (KNSS) can increase the portion of cold rolled steel or CRC (cold rolled coil ),” he said. This is in line with the Ministry of Industry’s policy to seek substitutions for similar goods imported from Japan as raw materials for the automotive sector.

Separately, President Director of PT Toyota Motor Manufacturing Indonesia (TMMIN) Warih Andang Tjahjono revealed in a meeting with Minister of Industry, Toyota Group gave an export update that reached 200,000 units in 2018. “We also convey to the Minister about the Toyota Group’s commitment of Rp28, 3 trillion, “he said.

At the one-on-one meeting in Tokyo, Minister of Industry had met a number of automotive industries from the State of Sakura, including directors of Mitsubishi Motors Corporation (MMC), Toyota Group, Daihatsu Motor Corporation, Hino Motor, Suzuki Motor Corporation, Isuzu Japan, and Honda Motorcycle.


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