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Realizing the potency of massive market in oil and gas sector, Indonesia implemented local content policies (LCPs) with the intention to require oil and gas companies to utilize host countries’ goods and services.
The LCPs in Indonesia stipulate the regulation in some particular areas in the oil and gas industries, including procurement rule, training and technology transfer, and employment requirement.
A report of SKK Migas year 2015 shows the decreasing trend in ratio of Indonesia-foreign employee from 2006 to 2015. Indicating that LCPs were able to encourage oil and gas companies to utilize Indonesian employees to work for their companies.
However, the whole (goods and services) of local content level from 2006 to 2014 also shows decreasing trend.
Inspired to investigate challenges in implementing LCPs in Indonesia, Yanuar Syapaat, a graduate of The University of Adelaide specialised in Project Systems, completed a study on LCPs in Indonesia.
Yanuar’s research aimed to describe implementation and outcome of LCPs in Indonesia and four selected countries, namely Australia, Norway, Brazil, and Nigeria.
Yanuar used Soft System Methodology to analyse adaptable solution from the best practices of LCPs implementation in four countries to answer the challenges in Indonesian context.
His study discovered that most of the challenges could be possibly solved by adopting the strategic steps of implementation in these four countries, including:
- Monitoring, enforcement and evaluation including fines and sustainable evaluation and feedback system.
- Industrial agglomeration and specialization, also research and development in universities and research centre.
- Decentralization consideration.
- Support and development.
- Anti-dumping policies.
More information could be accessed by contacting Yanuar Syapaat in firstname.lastname@example.org
Yanuar Syapaat completed his Master Degree in Applied Project Management Program, The University of Adelaide, with support of a scholarship from Indonesia Endowment Fund for Education (LPDP).
He was the head of LPDP South Australia (LPDP awardee and alumni community in South Australia) from 2016 to 2017.
Indonesia Research Update is a joint initiative by GoLive Indonesia and LPDP South Australia that aims to promote and disseminate knowledge and information obtained through research completed by Indonesian students outside of Indonesia.
We sincerely thank Kang Yanu and wish the best for his future endeavors in career and life.