AI and Semiconductors: Indonesia’s Vision for Economic Growth

Jakarta, INTI - Indonesia’s digital economy is rapidly evolving, and the government is spearheading initiatives to support technological innovation in all sectors. One of the key pillars of this initiative is the National Digital Economy Framework, launched in 2023, which emphasizes artificial intelligence (AI) and semiconductors as central to Indonesia’s economic strategy today and in the future.

“We should be thankful for Indonesia’s demographic bonus, but this bonus must lead to increased productivity. To achieve that, the government is providing special education, re-skilling, up-skilling, and world-class education programs. Among them, the Tsinghua University presence in the Kura-Kura Bali Special Economic Zone (KEK) should be expanded and deepened,” said Coordinating Minister for Economic Affairs, Airlangga Hartarto, at the "Shaping The Future Economy: AI & Semiconductor" Knowledge Sharing and Networking event at the Unity in Diversity (UID) Campus in the Kura-Kura Bali KEK, on Sunday (29/09).

The event was organized in partnership with the KEK National Council, the Kura-Kura Bali KEK, Tsinghua Southeast Asia, and the Indonesian Engineers Association (PII). Minister Airlangga highlighted the importance of gathering all stakeholders from the government, academia, and industry for collaboration.

“This meeting marks Indonesia’s initial steps toward building its AI and semiconductor ecosystem,” Airlangga said.

The UID Bali Campus serves as a hub for leadership programs and continuous education partnerships between UID and Tsinghua Southeast Asia (TSEA). Minister Airlangga also encouraged the development of an economic campus within the Kura-Kura Bali KEK, which would become the intellectual and economic hub of the region.

“This campus can play a vital role in human resource development, particularly in Indonesia’s eastern and central regions. If we expand the Tsinghua campus in Indonesia, catering not only to Java but also to the central and eastern regions, it will act as a catalyst for technological and innovation growth in Indonesia,” said Airlangga.

He further noted that technological transformation is essential for unlocking Indonesia’s economic potential by accelerating the conventional economy, driving new engines of growth, and strengthening the Pancasila economy.

As part of the Making Indonesia 4.0 initiative, the government is committed to transforming Indonesia’s manufacturing sector through the application of advanced technology. During Indonesia’s ASEAN Chairmanship in 2023, Minister Airlangga also launched the Digital Economic Framework Agreement (DEFA) to drive economic growth in the ASEAN region.

To support this, the government has created a semiconductor task force to advance the semiconductor ecosystem. The country is set to increase local Assembly, Testing, and Packaging (ATP) capacity and foster the development of highly skilled talent.

“Developing AI and semiconductors involves many skilled workers. This initiative will actually create more jobs with diverse skill sets,” Airlangga concluded.