Indonesian Fundamentals Are Strong, Airlangga Reveals Three Economic Driven Machines

Coordinating Minister for the Economy Airlangga Hartarto (Photo: Antara)

Coordinating Minister for Economic Affairs Airlangga Hartarto said the Indonesian economy has strong fundamentals to achieve a sovereign, advanced and prosperous country in 100 years of independence, namely Indonesia Emas 2045.

As for the second quarter of 2024, Indonesia's economy grew strongly at 5.05 percent, ahead of China by 4.70 percent, Singapore by 2.9 percent, South Korea by 2.30 percent and Mexico by 2.24 percent.

Airlangga said the growth was also supported by controlled inflation, in July 2024 it was at 2.13 percent, maintained in the target range.

Our global competitiveness index also increased by 7 points a year. The rating agency provides good comments on our infrastructure, business efficiency, government efficiency, and economic performance. So I think our reform has been implemented and appreciated by actors and stakeholders," he said in his statement, quoted Wednesday, August 7.

According to Airlangga, increasing sustainable infrastructure investment for a resilient future has an important role. Therefore, the government will prepare several policy strategies in achieving the vision of Indonesia Gold 2045 through three economic machines to accelerate growth, namely revitalizing conventional economic machines to increase capacity and productivity.

Airlangga said the government would develop new economic machines, including digital technology, green economy initiatives, and modern biotechnology, as well as increasing focus on resilience and social empowerment to ensure socio-economic sustainability.

In addition, Airlangga is optimistic that Indonesia's participation in various international cooperation forums such as ASEAN, G20, RCEP, IPEF, EURASIA, CP-TPP, Indonesia's relations with EU, and including accession to become an OECD member will contribute to increasing domestic investment, world trust in Indonesia, as well as opening wider export markets.

Airlangga added that the government also encourages the downstream industry policy to increase the value of the national economy and support the technology and manufacturing sector, including the components of electric vehicles (EVs).

In addition, Airlangga said that Indonesia is accelerating the development of the semiconductor industrial ecosystem as a new economic engine, including the integration of important assets such as minerals, skilled technicians, and renewable energy, into the global chip industry, including the development of Batam and Bintan as special economic zones for semiconductors, which are supported by targeted policies, fiscal incentives, clean energy, and mineral smelting.

We have several start-ups. Some young people open a business like engineering or consultants in Bandung. And they are also NVIDIA vendors, TSMC. They also get funding from New York. So I think we need to multiply this talent for the semiconductor industry, "concluded Airlangga.