Transforming Indonesia’s Economy with AI and Semiconductor Innovation

Jakarta, INTI - In response to the rapid advancement of digital technology, the Indonesian government has launched initiatives aimed at promoting the digital economy across various sectors. One such effort is the National Digital Economy Framework, introduced in 2023, which highlights artificial intelligence (AI) and semiconductors as key components in Indonesia’s future economic strategies.

“We should be grateful for the demographic bonus in Indonesia, but it must lead to productivity. The government is working to achieve this through specialized education, re-skilling, and up-skilling, and providing world-class education. One example is the presence of Tsinghua University in the Kura-Kura Bali Special Economic Zone (KEK), which needs to be expanded,” said Coordinating Minister for Economic Affairs Airlangga Hartarto at the "Shaping The Future Economy: AI & Semiconductor" event at the Unity in Diversity (UID) Campus in the Kura-Kura Bali KEK on Sunday (29/09).

The event, organized in collaboration with the KEK National Council, KEK Kura-Kura Bali, Tsinghua Southeast Asia, and the Indonesian Engineers Association (PII), brought together government officials, academics, and industry leaders.

“This is an important first step for Indonesia to become part of the AI and semiconductor ecosystem,” Airlangga noted.

The UID Bali Campus has become a hub for leadership programs and continuous education initiatives between UID and Tsinghua Southeast Asia (TSEA). Minister Airlangga urged the development of an economic campus within the Kura-Kura Bali KEK to serve as a center for intellectual growth and human resource development.

“The campus should serve as the core for developing human resources, especially in Indonesia’s eastern and central regions. If we expand the Tsinghua campus here to accommodate not only students from Java but also the central and eastern regions, it will be a driving force for technological and innovative progress in Indonesia,” said Minister Airlangga.

Minister Airlangga emphasized the importance of technological transformation for unlocking Indonesia’s economic potential. This transformation involves revitalizing traditional economic engines, introducing new engines of growth, and reinforcing the Pancasila economy.

In addition to leading the Making Indonesia 4.0 roadmap, which aims to modernize the country’s manufacturing sector, Minister Airlangga has also launched the Digital Economic Framework Agreement (DEFA) under Indonesia’s ASEAN Chairmanship in 2023 to strengthen the digital economy across the ASEAN region.

The government has also established a semiconductor task force to expedite the development of the semiconductor industry in Indonesia. Plans are in place to increase local Assembly, Testing, and Packaging (ATP) capacity, alongside fostering the development of high-skilled talent.

“The development of AI and semiconductors requires a diverse workforce, and this will ultimately create more jobs with varying skill levels,” Airlangga concluded.