The Indonesian Government has downsized its coal production target to 400 million tonnes in 2014 – a significant 21 million tonnes lower than production in 2013, according to Mr Syukhtar, general director for mineral and coal affairs at the Ministry of Energy and Mineral Resources.

The official said the plan has been proposed on the basis of the government’s sector development policy, which aims to increase revenue from raising the value of products rather than the quantity of production.

To this end, the ministry is also planning to enhance its supervision over mining and distribution in the coal and mineral sector and encourage the development of more relevant products for the industry.

Indonesia ’s domestic coal consumption reached 72 million tonnes during 2013, and the figure was expected to hit 95.5 million tonnes in 2014.

Also in 2013 the non-tax revenues from coal and mineral sector stood at 33.1 trillion Rp, up 38 percent from that in 2012.

Syukhtar has also said that the implementation of the new law on mineral and coal mining which bans the export of raw materials effective from January 2014, is bound to affect the trade and employment.

Trade Minister Gita Wiryawan also warned last month that the Indonesia exports would drop in 2014 since about 62 percent of Indonesia ’s exports are chiefly raw minerals.

He reminded that, in essence, the implementation of the law will provide added value to Indonesia ’s natural resources.

In the short- term, the law would have adverse effect on employment sector. But in the long- term, more workers will get employment if there is development and increase in the number of industries using mineral resources as raw material, the trade minister said.

Meanwhile, Minister of Finance Chatib Basri noted that the decline in unprocessed mineral exports can also affect the country’s trade balance. However, the deficit might not grow too wide because the government is also reducing its oil and gas imports as a result of the new biodiesel policy, he said.
According to the Indonesian Finance Minister Chatib Basri, Indonesia is expected to save 200 million USD in foreign exchange in 2013 after implementation of the biodiesel policy, and hopes its savings increase to 4 billion USD if the policy is fully implemented this year.-VNA