Indonesia invests in $800 million chemical plant to boost local industry

Indonesia is set to enhance its chemical manufacturing capabilities with an $800 million investment in a new chemical plant project spearheaded by Chandra Asri Pacific. The project, supported by the sovereign wealth funds Danantara Indonesia and Indonesia Investment Authority, is located in Cilegon, approximately 100 kilometers from Jakarta. Once completed in 2027, the plant will be capable of producing 400,000 tons of caustic soda and 500,000 tons of ethylene dichloride each year. This initiative highlights an important shift towards self-sufficiency in the production of essential chemicals, previously reliant on imports. Chandra Asri, a major player in Indonesia's petrochemical sector and controlled by billionaire Prajogo Pangestu, aims to significantly reduce the nation's dependency on imported chemicals through this facility. The production of caustic soda, a vital component for manufacturing electric vehicle batteries, and ethylene dichloride, essential for producing PVC pipes, is poised to stimulate local industry and create economic opportunities. The project is expected to generate substantial savings for Indonesia, allowing the country to reduce its chemical import expenditures. In addition to its economic impact, the new facility represents a strategic move to foster growth within Indonesia's chemical industry. By collaborating with prominent investors, Chandra Asri seeks to build a resilient industrial ecosystem in the rapidly evolving Asian economy. The company has already established itself across Southeast Asia, including recent acquisitions of Shell's assets in Singapore. This new initiative is anticipated to catalyze further investments and partnerships in the region. As the plant approaches its completion date, it promises to enhance Indonesia's industrial landscape, bolster exports, and contribute to national economic growth. Stakeholders express optimism regarding the collaboration's potential, foreseeing improvements in the country's chemical sector and its significance in the broader global marketplace.