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Economic value creation from nickel downstream processing in Indonesia: Evidence from input–output and empirical value-added estimation Harimurti, Ivan Krishna; Akbar, Ikhsantino; Pratama, Kristian Abillio
Educoretax Vol 6 No 3 (2026)
Publisher : WIM Solusi Prima

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.54957/educoretax.v6i3.2087

Abstract

Indonesia has promoted nickel downstream industrialization to enhance structural transformation and increase domestic value creation. As the world’s largest nickel producer, the country aims to shift from raw ore exports toward processed products to capture greater economic benefits. However, quantitative evidence on the magnitude of value added at both sectoral and product levels remains limited. This study measures the economic value added of nickel downstream processing using a dual approach. First, an input–output analysis evaluates backward linkages, forward linkages, and value-added multipliers across nickel-related sectors. Second, empirical calculations estimate value added from processing nickel ore into Nickel Pig Iron (NPI) and nickel matte. The results show that the non-ferrous basic metal industry functions as a key sector, with linkage indices above unity and the highest value-added multiplier (2.696). At the product level, NPI generates a value added of US$ 794.40 per ton (109% increase over raw ore equivalent), while nickel matte generates US$ 868.36 per ton (11% increase). These findings confirm that downstream processing enhances economic value, although gains vary across products, underscoring the importance of strategic product prioritization.
Analisis Dampak Fasilitas Fiskal pada Kawasan Ekonomi Khusus: Studi Kasus Sei Mangkei Harimurti, Ivan Krishna; Akbar, Ikhsantino
AKADEMIK: Jurnal Mahasiswa Ekonomi & Bisnis Vol. 6 No. 2 (2026): AKADEMIK: Jurnal Mahasiswa Ekonomi & Bisnis
Publisher : Perhimpunan Sarjana Ekonomi dan Bisnis

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.37481/jmeb.v6i2.1985

Abstract

Special Economic Zones (SEZs) are one of the government’s strategic policies to promote economic growth, attract investment, and accelerate regional development through various incentives, including fiscal facilities. This study aims to analyze the impact of fiscal incentives and investment activities on economic development in the Sei Mangkei Special Economic Zone (SEZ) in North Sumatra. The research employs a closed input–output analysis model using the 2016 Domestic Transaction Table of North Sumatra Province at producer prices, which covers 52 economic sectors published by Statistics Indonesia (BPS). The analysis focuses on sectors closely related to the main activities in the Sei Mangkei SEZ, including the chemical industry, plantations, food and beverage manufacturing, electricity, business services, warehousing and transportation, and metal and electronics manufacturing industries. Multiplier analysis and economic impact analysis are applied to examine the intersectoral linkages and the broader economic effects of investment. The economic shock used in the model is based on the value of investment commitments in the Sei Mangkei SEZ obtained from the 2021 SEZ Development Report. The results indicate that investment activities in the Sei Mangkei SEZ generate significant multiplier effects, increasing output not only in directly related sectors but also in other sectors within the regional economy. These findings suggest that the development of the Sei Mangkei SEZ has the potential to strengthen regional economic growth and stimulate broader economic linkages in North Sumatra.