The government continues to stress optimizing the use of domestic products, especially in procurement of goods and services by all agencies using state and regional budgets (APBN and APBD). This strategic effort can boost national economic growth and support the competitiveness of domestic industry.
“This policy of buying domestic products is not only in our country. We started in 2022. In 2023, look, the United States is doing the same, announcing priority for buying domestic products in government spending,” President Joko Widodo said in his remarks at the opening of Business Matching Phase V 2023, themed “Competitive Domestic Products for National Self-Reliance”, in Jakarta on Wednesday (15/3).
The President said the key going forward in optimizing local product use is disciplined implementation in realizing the budget. “I remember that previously only 50,000 products were in the e-Catalog. Now 3.4 million domestic products are in the e-Catalog, in a very short time, just over a year,” he said.
The Head of State reminded all state and regional budget users that, since many local products are already in the e-Catalog, they must not be left there but must be bought. “Ministries, agencies, state-owned enterprises, regional enterprises, provincial and regency/city governments, all of you, look at the e-Catalog. Buy,” he said.
The government targets domestic product spending in 2023 at 95 percent, or IDR 1,171 trillion. “So 95 percent of the goods and services budget ceiling must be spent on domestic products,” Jokowi added.
The target must be achieved to support domestic industry, including MSMEs, so they thrive and grow. “No need to look far for investors if this works. Investors are a nice bonus, but by buying domestic products, our economic growth will automatically rise,” he said.
Jokowi said many domestic industries can now produce quality, globally competitive products such as military uniforms, weapons and shoes. “We can already produce weapons and ammunition, let alone shoes. Why buy from abroad?” he said.
The President proposed linking optimized domestic product use to increases in performance allowances (tukin). “Once it is linked to tukin, everyone will be motivated. We will link it to buying domestic products,” he said.
Jokowi also reminded that once linked to tukin, there must also be sanctions. “If anyone still tries to buy imported products with APBN or APBD money, please formulate the sanctions, Coordinating Minister, so we all work with a system of reward and punishment,” he said.
On the same occasion, President Joko Widodo presented P3DN Awards for the best users of domestic products with the largest budgets to four winners: in the ministry/agency category, the Ministry of Public Works and Housing (PUPR), received by PUPR Minister Basuki Hadimuljono; in the Provincial Government category, DKI Jakarta Province (received by Acting Governor Heru Budi Hartono); in the City/Regency Government category, Bekasi City (received by Acting Mayor Tri Adhianto); and in the state-owned enterprise category, PT Semen Indonesia (Persero) Tbk., received by its President Director Donny Arsal.
There is also a producer category, with awards to be presented at the closing of the Business Matching. In the producer category, awards go to large, medium and small domestic industries.
The 2023 Domestic Product Spending Business Matching was held on 15–17 March 2023 at Istora GBK Jakarta. For three days, the Ministry of Industry and the Ministry of Defense are holding business matching to bring together users and industrial companies.
“The target of the 2023 Domestic Product Spending Business Matching is domestic product purchases by State Institutions, Ministries/Agencies, Regional Governments, state- and region-owned enterprises and certain business entities worth at least IDR 250 trillion,” Minister of Industry Agus Gumiwang Kartasasmita reported on the occasion.
Agus said the target can easily be achieved if government goods and services needs are mapped from the start. “Through this Business Matching, we hope to map goods needs for procurement by the Central and Regional Governments, state- and region-owned enterprises in 2023. Domestic producers can take advantage of this,” the Minister said.
Previously, Kemenperin held the 2022 Domestic Product Spending Business Matching in March 2022 in Bali, recording domestic product spending commitments of up to IDR 214 trillion. It continued through a fourth phase in October 2022. Besides national Business Matching, several regional governments and ministries/agencies also regularly hold Business Matching with industrial businesses according to their own needs.
The 2023 Domestic Product Spending Business Matching is packaged as a One Stop Event, meaning it is held in one place with various agendas on the importance of using domestic products.
Over three days, participants—including commitment officers (PPK) of work units, industry associations, upstream–downstream producers and suppliers—take turns at the desks provided for business meetings. There will also be the 2023 P3DN Awards, a Domestic Products Exhibition, a P3DN Team Communication Forum, Procurement Talk Shows and Technical Guidance, and a Consultation Corner for participants who need technical explanations on planning, procurement, supervision, TKDN certification, TKDN-IK certification or other consultations.
Throughout the 2023 Domestic Product Spending Business Matching, participants can also visit the Domestic Products Exhibition at the venue, where 108 association companies fostered by the Ministry of Industry showcase leading domestic products. The entire Business Matching series will be attended by 4,000 participants from ministries, agencies, regional governments, industrial companies, business entities and associations.
“We hope this Business Matching will publicize the rules on using domestic products and promote domestic production capabilities in government procurement of goods and services,” Agus explained.
The Minister also said that over the past 18 months Indonesia's Manufacturing Purchasing Manager’s Index (PMI) has always been in expansion, most recently reaching 51.2 in February 2023. Likewise, the Industrial Confidence Index (IKI) launched by Kemenperin recorded 52.32 in February 2023. “Both show industry's optimism about the national economy. We believe the P3DN program has contributed significantly to building that optimism. This shows the Government's support for the business climate and national industrial performance,” the Minister concluded.
Source: Press Release of the Ministry of Industry of the Republic of Indonesia