Government Realizes Downstreaming as Key to National Economic Equity
By: Mayang Dwi Andaru )*
Downstreaming is now one of the strategic steps relied on to encourage economic equality in Indonesia. Amidst global challenges and inequality that is still felt in various regions, downstreaming is not only about the process of processing natural resources, but also about creating equal opportunities for all levels of society.
Through this policy, the Indonesian government aims to optimize the potential of abundant natural resources, by processing them domestically to produce greater added value. That way, downstreaming is not only focused on industrialization and infrastructure development, but also on creating higher quality jobs, which in turn will contribute to reducing economic disparities between regions.
President Prabowo Subianto said that various major projects will soon begin in order to encourage downstreaming and industrialization on a large scale. In his view, this step is not only important for national progress, but also has the potential to have a significant impact on the global economy.
One of the main driving factors of this plan is the government’s success in making budget savings. Finance Minister Sri Mulyani Indrawati reported that efficiency in various sectors has created sufficient fiscal space to fund priority projects.
As part of its commitment to economic equality, the government is working hard to provide electricity access to all corners of the country. Minister of Energy and Mineral Resources, Bahlil Lahadalia, reported that there are still thousands of hamlets and hundreds of sub-districts that do not have electricity.
In the next five years, the government plans to allocate a budget of around IDR 48 trillion to address this problem. This funding is considered realistic thanks to the budget efficiency measures that have been taken since the beginning of President Prabowo’s administration.
Budget efficiency has been one of the main priorities since October 2024. The Ministry of Finance reported savings of IDR 3.6 trillion from the 2024 state budget, with cuts made in various sectors, including official travel and other operational expenses.
Finance Minister Sri Mulyani even issued a circular directing all ministries and institutions to cut spending by up to 50 percent. With this policy, the government has not only succeeded in creating fiscal space, but has also demonstrated its commitment to better budget management.
On the other hand, downstreaming is also a strategic solution to increase the added value of natural resources through domestic processing. Minister of Investment and Downstreaming, Rosan Roeslani, emphasized the importance of downstreaming in creating quality jobs. At the 2025 World Economic Forum (WEF) held in Davos, Switzerland, Rosan said that Indonesia’s demographic bonus is a great opportunity to drive the economy.
However, in order for this bonus to be utilized optimally, it is necessary to improve the quality of human resources. Without proper management, the demographic bonus could actually be an obstacle in achieving the vision of Golden Indonesia 2045.
Downstreaming is also an important step to strengthen Indonesia’s economic competitiveness in the global market. By processing natural resources domestically, the added value generated can have a major positive impact, both in terms of job creation and strengthening the national industry. In addition, industrialization is a main pillar in a sustainable development strategy, ensuring that economic benefits can be felt by the wider community.
Indonesia’s participation in WEF 2025 is real evidence of the government’s commitment to promoting the country as a sustainable investment destination. The Indonesian Pavilion at the forum was used to showcase investment opportunities to world economic leaders.
Minister Rosan also held meetings with global investors, discussing potential collaborations that could support Indonesia’s economic transformation. The downstream policy and the government’s commitment to sustainable development are the main attractions for investors who share a similar vision.
This effort also shows that the government is serious about attracting foreign investment to support economic growth. With the right investment support, downstreaming can be a major driver in creating economic equality throughout Indonesia. Downstreaming projects not only open up new jobs, but also improve the quality of existing jobs, providing new hope for the community.
