INDONESIA AKHMAD JAYADI Center for Indonesian Regional and Urban Studies (CIRUS)

LOCATION World’s largest archipelago. Est 17,508 islands. Extending 5,120 km (3,181 mi) from E to W, and 1,760 km (1,094 mi) from N to S. World’s 15 th largest country by area.

PEOPLE POPULATION : 230,472,833 OFC LANGUAGE : BAHASA INDONESIA LIFE EXPECTANCY : ETHNIC GROUP : Java, Sunda, Malay, Tionghoa, Madura, Batak, etc. RELIGION : Islam, Protestant, Chatolic, Hinduism, Buddhism.

ECONOMY GDP : USD Billion GDP Per Capita : USD 3,495 CURRENCY : Indonesia Rupiah (IDR) EXCHANGE RATE : USD 1 = IDR 9,000 UNEMPLOYMENT RATE : 7.5 M (6.3%) POVERTY : 30 M (24 %)

ECONOMY 3 MAJOR SECTORS : Manufacturing, Agriculture, Trade. EXPORT : USD 2,224 M (rubber, thermal coal, palm oil, etc. IMPORT : USD 175 M (machinery and mechanical, machinery and electrical, iron and steel, etc.)

ECONOMY EXPORT : Japan (USD 33 M), China (USD 22 M), Singapore (USD 18 M), USA (USD 16 M) IMPORT : Singapore (USD 19 M), China (USD 19 M), Japan (USD 13 M), Korea (USD 9 M) INFLATION : 4.5 % GROWTH : 6.5 % FOREX RESERVES : USD 110 B

ECON. D & P MILESTONE Old Order ( ) by Pres. SOEKARNO: Nationalization of Dutch assets, unification of local entrepreneurs, open to world (trade, debt and grant). New Order ( ) by Pres SOEHARTO: Development Trilogy (national stabilization, development equality, and growth acceleration), top down/centralized, open economy.

ECON. D & P MILESTONE 1997 – 1998 Financial and Monetary Crisis Transition Era (1998 – 1999) by Pres. HABIBIE: Central Bank independency, currency stabilization, bottom-up/decentralization, social safety net (JPS). Reform Era (1999 – 2001) by Pres. WAHID: regional autonomy (on budget), soft loan for SME’s, bureaucratic reform.

ECON. D & P MILESTONE Collaboration Era (2001 – 2004) by Pres MEGAWATI: divestment/privatization of SOE, stabilization of the currency, more open to PRC and Russia. United Indonesia Era I (2004 – 2009) by Pres YUDHOYONO: boost infrastructure, social health insurance, direct cash transfer, 20% allocation of national budget for education.

ECON. D & P MILESTONE United Indonesia Era II (2009 – 2014) by Pres YUDHOYONO: ACFTA, bureaucratic reform, national program for community empowerment, fuel subsidies cutting, MP3EI.

ADVANTAGES Economic planning and development in Indonesia is under control of Ministry of National Planning and Development (PPN) and under coordination of National Planning and Development Agency (BAPPPENAS). Some ministries and department are related, e.g.: ministry of trade, ministry of industry, ministry for accelerated development for disadvantaged region, etc.

ADVANTAGES Over past 8 years of the United Indonesia Era, some goals are achieved, e.g.: Indicators Poverty36 M (32%)30 M (24%) Growth5.3 %6.5 % GDPUSD BUSD B GDP Per CapitaUSD 1,178USD 3,495

CHALLENGES Some main problems of Indonesia’s development are: Inequality development between: urban-rural, central-region, rich-poor. Environmental damages, air/soil/water/noise pollution. Social capital lost among rural people Unsustainable development. lack of infrastructure (telecom, transport, IT).

DENSITY

CHALLENGES One of the development program is MP3EI (Master Plan for Planning and Development of Indonesian Economy). Its role is creating 6 new economic corridors to make interconnectivity among region. MP3EI not only connecting region by air, sea and land way, but also specialize each corridor with specific products (1: food security & energy, 2: services industry, 3: mining & energy, 4: tourism & food security, 5: agriculture, fisheries, oil & gas 6: energy, food security & mining).

1 KE Sumatera 2 KE Jawa 5 KE Bali – Nusa Tenggara 6 KE Papua - Maluku 3 KE Kalimantan 4 KE Sulawesi – Maluku Utara Jakarta Medan Pekanbaru Jambi Palembang Lampung Semarang Banjarmasin Palangkaraya Pontianak Makassar Manado Kendari Gorontalo Manokwari Jayapura Serang Mamuju BIMP-EAGA ECONOMIC CENTERMEGA ECONOMIC CENTER SEZ FTZ Merauke Kupang Samarinda Ternate Wamena Sorong Ambon SIX PRIORITY ECONOMIC CORRIDORS OF MP3EI Future Global Hub K. Tanjung Future Global Hub BITUNG Denpasar Mataram Surabaya International Port PANJANG International Port TELUK LEMBAR 53

FURTHER PLAN In order to solve the distribution problem, we suggest government to the follows policy: Move the capital to Kalimantan Island Create more SEZ, EPZ, HTZ etc. in some strategic small island. Attract more investor by reducing the tax, lowering the land rent, and competitive worker wage and simplify the investment procedure Sign more economic and trade and agreement

TERIMA KASIH XIE XIE THANK YOU GRACIAS MUCAS MERCI OBRIGADO SYUKRON DÍKY DZIĘKI KÖSZÖNÖM VĎAKA MÈSI