{
    "success": true,
    "data": {
        "id": 1718649,
        "msgid": "up-to-1-020-jobs-at-risk-as-oil-crunch-disrupts-plastic-industry-1777964070",
        "date": "2026-05-05 02:27:49",
        "title": "Up to 1,020 Jobs at Risk as Oil Crunch Disrupts Plastic Industry",
        "author": " ",
        "source": "GALERT",
        "tags": "",
        "topic": "Economy",
        "summary": "Indonesia\u2019s plastic industry faces significant disruptions from a global oil supply crunch, exacerbated by the closure of the Strait of Hormuz, potentially leading to job losses of up to 1,020 workers and GDP impacts ranging from Rp 960 billion to Rp 1.4 trillion across various scenarios of supply decline. The sector's heavy reliance on imported raw materials, accounting for 41% of domestic demand, heightens vulnerability to international price fluctuations and supply shortages affecting downstream industries like food, pharmaceuticals, and logistics. Policy shortcomings, including fragmented regulations and limited incentives for domestic production and recycling, further compound the risks, underscoring the need for aligned strategies to mitigate long-term import dependency.",
        "content": "<p>Up to 1,020 Jobs at Risk as Oil Crunch Disrupts Plastic Industry<\/p>\n<p>Jakarta. Indonesia\u2019s plastic industry is bracing for job losses and\noutput shocks as a global oil and gas supply crunch disrupts raw\nmaterial flows, with up to 1,020 formal workers at risk, a study by the\nInstitute for Economic and Social Research of Faculty of Economics and\nBusiness University of Indonesia (LPEM FEB UI) shows.<\/p>\n<p>In its report National Plastic Crisis Amid Global Shock, LPEM said\nthe closure of the Strait of Hormuz has cut Middle Eastern crude supply\nby 20%\u201330%, triggering shortages of primary feedstock and disrupting\ndomestic plastic processing and recycling activities.<\/p>\n<p>\u201cThe plastic raw material industry is projected to face a larger hit\nfrom the demand side. Meanwhile, plastic application industries are\nunder both demand and supply pressures. The plastic recycling industry\nis expected to face disruptions in recycled material inputs,\u201d LPEM FEB\nUI wrote.<\/p>\n<p>The study estimates direct losses to Indonesia\u2019s plastic industry GDP\nat between Rp 960 billion and Rp 1.4 trillion ($80.6 million), with\nbroader spillovers likely across downstream sectors such as food and\nbeverages, pharmaceuticals, retail, logistics, and e-commerce that rely\nheavily on plastic packaging.<\/p>\n<p>LPEM FEB UI outlined three supply shock scenarios:<\/p>\n<ul>\n<li><p>20% supply decline: GDP loss of Rp 960 billion; 680 jobs\naffected<\/p><\/li>\n<li><p>25% supply decline: GDP loss of Rp 1.2 trillion; 850 jobs\naffected<\/p><\/li>\n<li><p>30% supply decline: GDP loss of Rp 1.4 trillion; 1,020 jobs\naffected<\/p><\/li>\n<\/ul>\n<p>The risks are amplified by Indonesia\u2019s structural dependence on\nimports. The country remains a net importer of primary plastics,\nfinished plastic products, and recycled materials. In 2025, net plastic\nimports reached $7.7 billion, equivalent to around Rp 127 trillion\n(assuming Rp 16,500 per dollar).<\/p>\n<p>High reliance on imported upstream petrochemical products further\nunderscores the vulnerability. As of 2019, about 41% of domestic plastic\nraw material demand was met through imports, reflecting the sector\u2019s\ncapital-intensive and technology-heavy nature, as well as dependence on\nnaphtha feedstock largely sourced from abroad.<\/p>\n<p>\u201cThis import dependency makes domestic prices highly sensitive to\nglobal commodity price fluctuations,\u201d LPEM FEB UI added.<\/p>\n<p>Beyond supply risks, the report flagged policy gaps that continue to\nweigh on the industry. First, Indonesia\u2019s plastic regulations are broad\nbut fragmented. Second, import and tariff policies are more effective at\nsecuring short-term supply, while incentives for upstream investment,\nimport substitution, and recycling remain limited. Third, policy\nobjectives often lack alignment between ensuring affordable imported\nfeedstock and promoting domestic petrochemical development.<\/p>\n<p>\u201cAs a result, businesses face uncertainty over whether the government\naims to ease resin imports or build long-term import substitution,\u201d LPEM\nFEB UI said.<\/p>\n<p>Tags: Keywords:<\/p>",
        "url": "https:\/\/jawawa.id\/newsitem\/up-to-1-020-jobs-at-risk-as-oil-crunch-disrupts-plastic-industry-1777964070",
        "image": ""
    },
    "sponsor": "Okusi Associates",
    "sponsor_url": "https:\/\/okusiassociates.com"
}