High Cocoa Imports Call for Economic Reform

Rendy Andriyanto
Rendy Andriyanto
Gotrade Team
Reviewed by Gotrade Internal Analyst
High Cocoa Imports Call for Economic Reform

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Gotrade News - President Prabowo Subianto has raised concerns about Indonesia's high cocoa imports despite the country being a major producer. The import value has reached IDR 18.7 trillion. This situation arises from a suboptimal supply chain, leading domestic industries to prefer imports. It's paradoxical since the national cocoa processing capacity is sufficient, yet its utilization is only around 50%.

There is significant potential if the supply chain is improved. According to the Founder of Supply Chain Indonesia, improvements could reduce imports by up to 50%, saving USD 550 million in foreign exchange. The implications are crucial, as cutting down imports would reinforce the domestic economy.

In another sector, Prabowo targets the construction of 1,100 Fishing Villages by 2026 as part of an effort to enhance fishermen's welfare. This project is expected to boost fishermen's income by up to 80% and spur economic growth of over 8%.

Alongside increasing production, enhancing industrial capacity is also a key focus. Building processing industries near raw material sources can reduce import dependency. Post-harvest standardization and logistical support are essential.

However, challenges remain, notably the high domestic distribution costs. More expensive than imports, local raw materials become less competitive. Prabowo supports downstream processing to optimize local raw material use in domestic industries.

Physical development and integrated industrial growth are expected to fuel further expansion. With investment incentives and licensing ease, Indonesia can enhance its global industrial competitiveness.

Prabowo believes that with concrete steps and accelerated program implementation, the target of over 8% economic growth can be achieved. These reform efforts are critical to creating a sustainable economy.

In conclusion, despite various challenges, there is optimism and a strong resolve from Prabowo and the government to address these issues with multi-sectoral solutions.


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