News

KIHI Targeted to be Finished in Four Years

Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan targets the construction of the Indonesia Green Industrial Park (KIHI) Tanah Kuning-Mangkupadi in North Kalimantan to be finished in four years.

"From the meeting with the NDRC (National Development and Reform Commission) we hope that in the next month the groundbreaking can be done, construction will begin. I think it will be finished in four years," Luhut said while in Shanghai, China recently.

During his working visit to China some time ago, Luhut visited a number of cities and regions such as Beijing, Jilin, and Shanghai. There he met with Chinese Foreign Minister Wang Yi, Head of China's National Development and Reform Commission (NDRC) Zheng Shanjie, officials from Tsinghua University, and businesspeople from China.

Luhut also specifically requested that the NDRC support the implementation of the KIHI. When meeting with the Head of NDRC Zheng Shanjie, Luhut even said that one of the factories in the industrial area would become the largest petrochemical factory in Asia with an annual capacity of 64 million tons per year.

Previously, the industrial area in North Kalimantan was also discussed at a bilateral meeting between President Joko "Jokowi" Widodo and Chinese President Xi Jinping on July 27, 2023. They discussed the joint call for companies in the petrochemical and hydropower sector in North Kalimantan.

The KIHI, which spans an area of ​​around 30 hectares (ha) in Bulungan Regency, North Kalimantan is estimated to have an investment value of up to US$132 billion (around Rp2.17 quadrillion). The location of the area is also only 185 km from the Nusantara, Indonesia's future capital.

On top of being set to host the largest petrochemical factory in the country, there are also plans to build an aluminium processing and refining smelter with a capacity of three million tons in the industrial area. There are plans to establish an iron and steel factory with a capacity of five million tons per year.

There are also plans to build an electric vehicle battery factory and a new renewable energy-based generator with a capacity of 265 Giga Watt hour (GWh). Finally, there are plans to build a polycrystalline silicon factory with a capacity of 1.4 million tons.

North Kalimantan Governor Zainal A. Paliwang said that North Kalimantan needs investment to boost regional income.

"Blue economy and green economy in the green energy concept are being intensively implemented," he explained.

"Many investors are pursuing geothermal, solar panels, power plants, hydropower, these are very promising future investments," Zainal added.

The large influx of investment to the province is expected to able to create many job opportunities, increase people's income and purchasing power, as well as provide for more even distribution of economic growth.

Zainal also revealed several potential investments in North Kalimantan that could attract investors, such as the construction of Bebatu Port in Tana Tidung Regency, hotels & restaurants as part of meeting, incentive, convention, and exhibition industry-oriented development in the regencies of Tana Tidung and Malinau, as well as seaweed downstream industry in Nunukan Regency and Tarakan City.

"The strategy to increase investment realization in North Kalimantan is to prepare and implement good corporate governance through Integrity Zones (ZI), Corruption Free Areas (WBI), Integrity Facts (FI), and online-based licensing service facilities," he explained.

Related Articles