Ministry Endorses Petrochemical Sector as a National Strategic Project
The Indonesian Ministry has designated the petrochemical sector as a national strategic project to boost industrial growth and self-sufficiency. Key developments include the inauguration of Southeast Asia's largest petrochemical plant by LOTTE Chemical, a $3.9 billion investment aimed at increasing domestic production capacity and reducing import dependency. The project supports economic growth, job creation, and Indonesia’s expanding role in regional markets.
The Indonesian government, through its Ministry, is prioritizing the petrochemical sector as a strategic national project to enhance economic development and industrial competitiveness. A centerpiece of this initiative is the inauguration of Southeast Asia’s largest petrochemical plant in Cilegon, Banten Province, completed by LOTTE Chemical with an investment of approximately $3.9 billion. This complex, operational since May 2025, produces major petrochemical outputs including ethylene (1 million tons), propylene (520,000 tons), polypropylene (350,000 tons), butadiene (140,000 tons), and BTX (400,000 tons) annually. The project is poised to increase Indonesia’s ethylene self-sufficiency from 44% to 90%, significantly reducing reliance on imports and improving the trade balance. Beyond production, the plant incorporates advanced technology for energy efficiency and carbon reduction and integrates with existing facilities to lower logistics costs. The Ministry’s support, including tax incentives and policy measures, aligns with Indonesia’s broader industrial roadmap targeting sustained growth above 5%. This strategic focus on petrochemicals is expected to generate significant economic value, create jobs, and position Indonesia as a regional hub for Southeast Asia’s petrochemical market expansion. Additionally, these efforts underpin larger goals of enhancing downstream industries, fostering global competitiveness, and securing future industrial resilience.
