Indonesia's Economic Transformation Towards a Developed Country by 2045

Jakarta, INTI - Supported by the resilience of the national economy, which can grow steadily at around 5% and strengthened by the ability to maintain inflation within the target range, Indonesia is increasingly optimistic about driving the pace of national economic transformation towards becoming a developed country by 2045. At that time, Indonesia is expected to have around 320 million people with a per capita income of around USD 26,000, making Indonesia's economy estimated to reach around USD 9 trillion.

To realize this vision, the government continues to encourage the renewal and improvement of the performance of various economic growth engines, especially in the current era of digitalization. In 2018, the government pushed for the enhancement of the national industry's capabilities to be globally competitive by launching the "Making Indonesia 4.0" Roadmap. In the future, the digitalization of various industries will continue to be accelerated so that investments in Indonesia will be more capital-intensive and require new skills from the community.

“We have a second engine that is currently under discussion, namely the digital economy. Our digital economy is currently around USD 80 billion, and we hope that by 2025 it can increase to USD 125 billion, and by 2030 we hope it will be around USD 400 billion," said Coordinating Minister for Economic Affairs Airlangga Hartarto at The Big Idea Forum CNN with Desi Anwar themed Quo Vadis Digital Transformation Indonesia, Friday (5/07).

Government Efforts to Prepare Competitive Human Resources

The government is also taking various measures to prepare competitive human resources. Through the Pre-Employment Program, the government provides policies that are government-to-people aimed at re-skilling, up-skilling, and empowering the community through various training programs in line with the labor market needs. Since its inception, the Pre-Employment Program has reached up to 18 million beneficiaries.

As an archipelagic country, Indonesia faces unique challenges in promoting connectivity equity and accelerating the development of adequate digital infrastructure. Some of the efforts include building the Palapa Ring fiber optic network, utilizing the Multifunction Satellite Satria for underdeveloped, frontier, and outermost regions, and the latest being the adoption of Low Earth Orbit Satellite technology.

Indonesia as a Hub for Unicorns and Decacorns

On this occasion, Coordinating Minister Airlangga also conveyed that Indonesia has become the country with the largest number of unicorns and decacorns among other countries. This is partly driven by the government's efforts to integrate with ASEAN countries, making it easier to develop and expand market reach.

Indonesia's initiative in the form of the Digital Economic Agreement Framework (DEFA) during the ASEAN 2023 Chairmanship, according to Coordinating Minister Airlangga, has opened a new chapter in regional digital economic integration and is expected to attract investment and innovation, increase productivity, create jobs, and empower MSME sectors. With the utilization of DEFA, ASEAN's digital economy, which was initially valued at USD 1 trillion by 2030, is estimated to increase to USD 2 trillion.

Indonesia, along with other ASEAN countries, has also integrated payments with the Local Currency Settlement policy through the use of QRIS, facilitating efforts to drive digitalization in the economic sector. Furthermore, Coordinating Minister Airlangga mentioned that amid various digitalization efforts, data security also becomes a significant challenge and an essential aspect that needs to be continuously accelerated.

Global Commitment to Economic Transformation

“Indonesia needs to be everywhere. So we work with Europe on the EU-CEPA, so we can be Europe's partner. We are in ASEAN, partnering with China, with ASEC, RCEP. We are also with India and the US in the Indo-Pacific signed two weeks ago. And of course, the last thing we did, we want to be part of the 37 OECD countries. This will be a three-year journey. So in terms of economics, we are friends with everyone,” stressed Coordinating Minister Airlangga.

Present at the event were Director of ASEAN Integration Monitoring Directorate Ahmad Zafarullah Abdul Jalil, Spokesperson for the Coordinating Ministry for Economic Affairs Haryo Limanseto, Representative of UNIDO for Indonesia, Timor Leste, & ASEAN Marco Kamiya, President Director of PT A.T Kearney Indonesia Shirley Santoso, and Director of Government Affairs & Public Policy Google Indonesia Putri Alam.