Indonesian president Prabowo Subianto recently signed a government regulation on the governance of natural resource exports, establishing a natural resources (SDA) export agency. The agency will consist of a state-owned enterprise entity that will act as the sole exporter for designated natural resources.
Announcing the move while presenting the macroeconomic framework and fiscal policy principles for the 2027 state budget draft at the Jakarta parliament building, Prabowo said the measure aims to strengthen state control over natural resource exports. Under article 33 of the 1945 constitution -- which explicitly states that the state controls the land, water, and all natural resources -- the newly established export agency will require that all exports of relevant natural resources be channeled through designated state-owned enterprises.
The regulation will be implemented in phases. The first phase is a transition period from June 1 to August 31, 2026, during which export transactions will be gradually transferred from existing companies to state-owned enterprises. The second phase begins on September 1, 2026, when all import-export transactions between foreign buyers and Indonesian sellers will be fully conducted through designated state-owned enterprises.
Commodities covered in the first batch managed by the export agency include palm oil, coal, and ferroalloys. Prabowo explained that the designated state-owned enterprises will remit proceeds from each export sale to the businesses actually operating in the sector. He also emphasized that over the 34-year period from 1991 to 2024, potential state revenue losses due to unrecorded exports (i.e., under-invoicing) reached as high as $908 billion, or approximately 15,400 trillion Indonesian rupiah.
Written by Cora Ji, jiruyan@mysteel.com
