Indonesian President Targets Raising Biodiesel Production to Save Foreign Exchange

President Joko Widodo has said domestic biodiesel production will reduce diesel imports to save up to Rp56 trillion (almost US$4 billion) of foreign exchange in 2021, the Antara news reported on October 21.  The president noted that the country saved Rp38 trillion (almost US$2.7 billion) in foreign exchange in 2020 with reduced diesel imports

Indonesia produces bountiful quantity of crude palm oil that can be used to make biodiesel.  According to the president, the potential for crude palm oil production in Indonesia reaches 52 million tons per year. He expected that the immense resource could be processed into other products, including biodiesel. Thus, Indonesia can lower fuel imports and help to boost energy security. Suppliers and other industries will also be required in the process of transforming crude palm oil into biodiesel, thereby increasing the possibility to create several new jobs. The president emphasized that job creation in the down streaming of natural resources was an important goal to offer economic benefits to the community.

The production of domestic biodiesel is also expected to maintain and regulate stability in the price of crude palm oil in the global market. This is since crude palm oil products from Indonesia are not immediately exported. Indonesia has several options to optimize the contribution of crude palm oil for national economic interests