Krakatau Steel Pushes to Strengthen State Policy for the Sovereignty of the National Steel Industry

The global steel industry is in the world’s spotlight. The debate about the nationalization of ArcelorMittal that has emerged in France is a strong signal that the world steel industry is now at a crucial point. France’s move to consider nationalizing its largest steel producer is not a local issue, but a reflection of global turmoil caused by a flood of low-priced imports, especially from China, and an imbalance in the world market structure.

Analysis from Steel & Mining Insights written by Steel and Mining Industry Observer, Widodo Setiadharmaji, emphasizes that this problem is not just a local problem in France, but is part of a global distortion that has hit many countries.

“The pressure faced by France cannot be separated from the global market structure which is increasingly distorted by differences in costs and policies between countries,” wrote steel and mining industry observer, Widodo Setiadharmaji, on his official website.

This condition shows that the modern steel industry cannot stand alone without state support. Even France, which is a developed and high-tech country, is encouraged to consider nationalization to maintain the sustainability of its industry.

Global Pressure Strengthens

On his official website, Widodo Setiadharmaji pointed out that France is now entering the nationalization debate because its steel factories are unable to compete with China’s abundance of cheap exports which produce more than one billion tonnes of steel per year, or more than half of global production.

The condition of Europe, which is facing falling demand, high energy costs, and carbon tax obligations that do not apply in Asia, is worsening the competitiveness of local producers. In this situation, ArcelorMittal emphasized that nationalization will not solve structural problems without strong trade policy intervention at European level.

This phenomenon illustrates that global imbalance is not just a corporate issue, but a state issue.

“If the national steel industry is left to face global distortions alone, the sustainability of domestic steel factories will become increasingly fragile and vulnerable to unbalanced market pressures,” added Widodo Setiadharmaji.

French Learning Relevant for Indonesia

As a strategic BUMN that is the guardian of national industrial resilience, PT Krakatau Steel (Persero) Tbk / Krakatau Steel Group (IDX: KRAS) assesses that the dynamics occurring in Europe are important as a lesson for Indonesia. Global pressures that trigger deindustrialization in developed countries could be repeated in Indonesia if the state is not present through policies that are strong, adaptive and pro-domestic industry.

The President Director of PT Krakatau Steel (Persero) Tbk, Akbar Djohan, emphasized that what happened in France was a reflection of the challenges also faced by Indonesia.

“We continue to encourage the presence of the state in building a fair, competitive and sustainable industrial ecosystem in order to maintain the resilience of the national industry, because we believe that the sustainability of the national steel industry is not only determined by the company’s efficiency, but also by the state’s policy architecture,” explained Akbar Djohan who also serves as Chairman of the Indonesia Iron & Steel Industry Association (IISIA) and Chairman of the Indonesian Logistics & Forwarders Association (ALFI/ILFA).

A flood of low-priced imports also occurs in Indonesia and has a direct impact on factory utilization, expansion capabilities and the sustainability of national steel companies. Thus, the Company considers that collaboration between the Government, BUMN and industry is the key to avoiding the pressures of deindustrialization as experienced by European countries.

Realizing National Industrial Independence

To achieve the Asta Cita proclaimed by the President of the Republic of Indonesia, Prabowo Subianto, industrial independence is the main foundation for Indonesia to ensure long-term economic resilience. This independence does not only mean being able to produce strategic needs domestically, but also ensuring that the national supply chain is not dependent on global market fluctuations or the domination of other countries.

By building a strong, efficient and competitive national steel industry, including by strengthening the role of Krakatau Steel as a strategic BUMN, Indonesia can control its own production capacity for vital sectors such as infrastructure, energy, defense and manufacturing.

Industrial independence is a symbol that this nation is not only able to meet its own needs, but is also ready to face increasingly uncertain geopolitical and global economic dynamics. Through consistent policy support, strengthening the industrial ecosystem, and commitment to the use of domestic products, Indonesia can realize its dream of standing on its own feet and being independent in the field of industrialization.

About Krakatau Steel Tbk

A glance at PT Krakatau Steel (Persero) Tbk PT Krakatau Steel (Persero) Tbk is an integrated steel manufacturing company which was founded on 31 August 1970. Apart from operating in the steel industry sector, Krakatau Steel and the Group develop integrated industrial area businesses, ports, logistics, industrial water supply, energy supply through power plants, as well as several joint ventures with Korean and Japanese companies. Krakatau Steel is currently strongly committed to carrying out transformation through the spirit of “Revolutionary Movements: Committed to Transform” which aims to improve company performance, build trust and transparency with stakeholders, and attract investors. This transformation covers various aspects, including improving Human Capital, developing downstream business, and strengthening infrastructure business.