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Learning the Downstreaming from Different Perspectives

The downstreaming (hilirisasi) is becoming popular among Indonesian citizens. The popularity started with President Joko Widodo’s (Jokowi) statement at an investment forum in Jakarta recently. He stated that downstreaming consistency is the key to a successful shift towards a developed country.


Jokowi further claimed that downstreaming adds excellent value to the Gross Domestic Product (PDB). Based on the existing data, the downstream of non-metallic minerals and gas is projected to increase the Gross Domestic Product (PDB) and employment opportunities up to 8.8 million.


What Is Downstreaming?

According to the official dictionary of the Indonesian language (KBBI), downstreaming is processing raw materials into finished products to increase the value added to the country’s commodities.


Simply put, the downstreaming is a strategy to enhance the export value of certain commodities.


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The Institute for Development of Economics and Finance’s (INDEF) economic expert Esther Sri Astuti stated that the industrial downstream would add higher value to the processed natural resources. Thus, the policy is expected to support Indonesia’s economic growth.


“Note that we should prioritize the most suitable industry for the downstreaming. Meaning it should be appropriately targeted to our prioritized commodities. This strategy will result in the downstreaming’s successful implementation as expected,” Esther said.


Esther further explained that the whole industrial ecosystem and its commodities must be well-developed, from processing raw materials to developing finished or semi-finished products.


“It is expected to increase the value added to a commodity,” she said.


Supply Chain’s Essential Roles in Downstreaming

Regarding downstreaming implementation, Esther also stated that the smooth-running supply chain in the downstreaming is equally important.


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This goes beyond the number of commodities being processed. The shipping of all materials should also be considered.


“Similar to a missing piece in a puzzle, we often find such errors during the production stage of a supply chain. This can’t happen in downstreaming because it will greatly impact our production cost, which will be higher than in any other country. Furthermore, it can disrupt and even fail the ongoing downstreaming,” she continued.


Logistics Industry to Support the Success of Downstreaming

Given those circumstances, you should choose a professional, experienced, and reputable logistics service. A good logistics service ensures on-time delivery of raw materials to support the effectiveness of the downstream program.


SELOG is a reputable logistics company and a business line of PT Serasi Autoraya or SERA. It is also part of PT Astra International Tbk, which has been known in the industry for many years.


Initially established to provide vehicle rental solutions, SERA has become the largest, industry-leading transportation provider.


See also: Tips for Choosing the Right Logistics Company


With over 32 years of experience, SERA continues innovating, providing effective, efficient, and high-quality logistics services through SERA Logistic (SELOG).


SELOG serves the customers’ needs in end-to-end logistics through a series of diverse services. They range from Contract Logistics, Shipping Services, Shipping Agencies, Forwarding Agencies, Warehouse and Yard Management to Courier Services.


Driven by the latest digital technologies, SELOG’s services bring greater convenience, effectiveness, and efficiency to your business.


Through Astra Fleet Management Solution (FMS), SELOG provides businesses in Indonesia with comprehensive IT-based solutions for vehicle management.


To learn more about SERA’s profile and its services, including SELOG, visit its official website at https://www.sera.astra.co.id/.


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