Indonesian President Prabowo Subianto announced that the government will focus on the country's main commodity exports as a step to increase national income and strengthen control over the country's strategic natural resources.
In a speech in parliament on Wednesday, Prabowo claimed that Indonesia has lost around $908 billion in revenue over the past 34 years because the country's commodities are sold at too low prices on the global market.
He explained that major exports such as palm oil, coal and ferroalloys will henceforth be handled through companies or enterprises selected by the central government as sole exporters.
Indonesia is indeed a world commodity power with its status as the largest exporter of palm oil and thermal coal globally, making the move potentially have a major impact on the international market.
According to Prabowo, the government will introduce new regulations regarding the management of commodity exports as part of a strategy to strengthen the country's control over natural resource revenues.
The move is also seen as an effort to address the issue of lack of export invoices and transfer pricing practices that are feared to be causing leakage of national revenue.
The Indonesian government believes that the country's natural resources are sufficient to bring prosperity to the people if managed in a more structured manner and in line with the country's constitution.
The new policy also signals a more aggressive approach by the Prabowo administration in ensuring that profits from the country's natural resources can be maximized for the benefit of the domestic economy and the Indonesian people.
