Ministry Of Finance Staff: Utilization Of Demographic Bonuses Is The Way For Indonesia To Achieve The 5th Largest GDP Ranking Target In The World

Special Staff to the Minister of Finance for Strategic Communication at the Ministry of Finance Yustinus Prastowo. (Photo: Doc. Antara)

JAKARTA - Special Staff to the Minister of Finance for Strategic Communication at the Ministry of Finance Yustinus Prastowo said that the effective use of demographic bonuses is a way for Indonesia to be able to achieve the 5th largest target of Gross Domestic Product (GDP) in the world in 2045.

"It can be realized if the prerequisites are met, if the demographic bonus can be converted into a demographic investment that produces dividends in 2045, it will not turn into a demographic curse," Yustinus said at the Money Kita Talks seminar at Hasanudin University, quoted from Antara, Friday, October 6.

As of 2022, Indonesia is still ranked 16th in GDP in the world based on the US dollar reference. Yustinus assessed that the demographic bonus that Indonesia was experiencing should really be effectively utilized.

About 70 percent of Indonesian citizens are currently in productive age, so the dependence on economic ratio is getting lower.

The demographic bonus is a phenomenon where a country has a population of productive age in the age range of 15 to 64 years which is more than an unproductive population.

Furthermore, Yustinus also predicts that the contribution of the manufacturing industry to GDP will also increase from the previous 20.5 percent to 26 percent in 2045.

According to Yustinus, this is currently a momentum for Indonesia to play its role in the international economic arena, especially in the Asian region. He gave an example of China, which is experiencing contraction in its economy.

China's economy is predicted to decline significantly in the long term, and this will have an impact on the economies of countries partnering with China, including Indonesia. Likewise, what is happening in the United States (US) is currently experiencing an economic slowdown.

This momentum needs to be used by Indonesia to expand its economic reach in the region.

"What does that mean? There will be a tougher market struggle in Asia and Southeast Asia, then where do we want Indonesia, then we can be more strategic in optimizing our resources to be able to partner, partner with more and more countries," said Yustinus.

On another occasion, Coordinating Minister for Economic Affairs Airlangga Hartarto also targeted Indonesia's nominal GDP to reach 9.8 trillion US dollars by 2024, with Gross National Product (PNB) per capita of 30,300 US dollars.

He targeted the population of the middle income category by 80 percent, with the contribution of the manufacturing industry to GDP reaching 28 percent and absorption of 25.2 percent of the workforce.

Therefore, according to him, development approaches need to be changed from reformative to transformative, which at least includes infrastructure development both soft and hard, human resources, research, innovation, regulatory reform, data governance and security as well as increased investment and financing sources.