JAKARTA. Trade Ministerial Regulation No. 22/2018 which paved the way for steel imports resulted in the abundance of imported steel in Indonesia, which has caused difficulties for local steel producers.
"It's not because our products are worse, but a a lot of importers don't play fair. For example, they pass carbon steel on as alloy steel to avoid import duties," said PT Krakatau Steel (Persero) Tbk (KRAS) CEO Silmy Karim as quoted by Kontan.co.id, Sunday (14/4).
Mr Karim, who is also Chairman of the Indonesian Iron and Steel Association (IISIA), said the pressure also affected the iron and steel industry. As of the first quarter of 2019, steel imports caused the utilisation of local steel plants to only reach 30% to 40%.
Mr Karim said he appreciated the government's issuance of Trade Ministerial Regulation No. 110/2018, which is expected to reduce the risk of fraud in steel imports. In the new regulation, inspection on imported steels will be returned from post border to the customs.
The regulation has been in effect since January 20, 2019, but import permits still give pressure on the national steel industry.
To resolve the problem, Mr Karim said he would continue to approach the government so the government would help KRAS and the national steel industry through proper regulations. (AM/MS)