JAKARTA (Reuters) – Indonesia must use the pandemic to reboot Southeast Asia’s biggest economy, including by improving food and energy security, as well as processing more natural resources at home, President Joko Widodo said on Friday.
Widodo made the remarks in his annual state of the union speech to parliament. Due to coronavirus precautions, less than half of the lawmakers were present for his address, with the rest watching online.
Likening the current economic situation to “a computer crash” causing stagnation, he said Indonesia, along with other countries, must “shutdown, restart and reboot”.
“We must not let the crisis bring about setbacks. In fact, we must capitalize on the crisis as a momentum to make a big leap,” said Widodo, who was wearing a traditional outfit from the Sabu people in the eastern part of the archipelago.
The government expects the economy to post near flat growth this year due to the pandemic, which has infected over 132,000 people and caused nearly 6,000 deaths, the highest death toll in Southeast Asia. Last year, the economy grew 5%.
Widodo said accelerating reform of the health sector was a top priority, along with strengthening food supply chains, including with a newly planned food estate on Borneo island.
Under energy reforms, Widodo highlighted plans to slash expensive oil imports by using fuel made from palm oil.
Indonesia’s Pertamina produced a first batch of biodiesel made fully from palm oil last month and is set to produce 1,000 barrels of the fuel at its Dumai refinery.
The so-called D100 would absorb a minimum of one million tonnes of farmer-produced palm for 20,000 barrels of production capacity per day, Widodo said, without giving a timeline.
Indonesia currently has a mandatory use of biodiesel with 30% palm oil content.
The president also stressed a need to push forward the downstream processing of raw materials including converting coal into gas and nickel ore into ferro nickel and stainless steel, as part of government efforts to create jobs.
(Reporting by Gayatri Suroyo, Fransiska Nangoy and Maikel Jefriando; Editing by Ed Davies)