Utilizing Domestic Products in the Procurement of Goods and Services

The President has issued Presidential Instruction No. 2 of 2009 with a view to providing optimal returns on government expenditure in the procurement of goods and services. Simultaneously, it is expected that the Instruction will also generate growth and develop domestic industries through the requirement to purchase domestically produced goods and services.

This Instruction was expected, as is a Minister of Industry Regulation that will set out the specifics in the form of guidelines.

The basic premise of the Instruction is to provide a mandate to all relevant authorities to maximize the sourcing and procuring domestic goods and services. To ensure that this happens, the Minister of Trade is to coordinate a “use Indonesian goods and services” campaign.

The Instruction establishes a National Team to facilitate the implementation of the provisions of the Instruction. The National Team includes, among others, the Ministers of: Industry, Home Affairs, Finance, and Trade. The National Team also includes the State Ministers of: Administrative Reforms, Cooperatives and Small and Medium Enterprises, and State-Owned Enterprises.

The basic duties and functions of the National Team are to compile and prepare policy, strategy, and programs to ensure optimal utilization of domestic goods and services. The National Team may engage the expert services of consultants, experts, academics, and others as required.

All financial needs of the National Team are to be facilitated through the State budget.

The Instruction was issued on 9 February 2009 and has been in force since that date.