Indonesia’s position is strategically
important because of its involvement in ASEAN.
Why I said it’s strategic? Because Indonesia is one of the founders of
the ASEAN. In fact Indonesia have the
biggest population in ASEAN, approximately 240 million people lives here or almost
50% from ASEAN’s population (500 million people) this country have many
potential market. We have many natural
resources here like Petroleum, Gold, Silver, Iron, Coal, etc. and the agricultural sector develop here, so
we don’t need import so many food here, it’s different from Arab –for example-
they have biggest Petroleum resources but they import so many food. Don’t forget we also have the marine and
fishery sector, it’s not the main sector, but we still have many room to
maximize it. For sure Indonesia began to show stability in economic
growth. This can be seen from Indonesia’s ability to survive the economic
crisis greater in 2008. If the 1997 economic crisis only affects the countries
of Asia, the economic crisis in 2008 hit almost every country in the world.
Those many potential thing can bring us to be
the largest economy –US $ 845.680billion (GDP Nominal IMF 2011)– in ASEAN.
The positive
and negative impact
With
our more contribution in ASEAN’s economy, we can increase our economy growth
percentage. Increasing the investment,
decreasing the unemployment number, etc.
It’s a huge market here, 240 million people and everybody wants to be what we called ‘population theme
investments’, you see 240 million Indonesian, 7 million people each year
graduated from lower income to middle income for the last seven years, that’s
50 million people, and if you talk about 7 million people a years that’s twice
of the population of Singapore, these people suddenly require more
consumptions, better education, they consume more, they buying more handset,
more recycle, next thing they want to do is they want a homes. The market is
big, I don’t think it’s saturated, everybody wants to get a piece of that, but
we need to be careful finding the right investment platform for because it’s a
growing market and still dominated by the key strategic investors but for
private equity players there is niche for us to participate.
It’s a large economy, the largest
in South East Asia, 4th most populous country, the third
largest democracy, it’s definitely need more private equity player in
Indonesia, we see more and more Pan-Asian Fund coming into Indonesia, we never
get to see them before, like five years ago, nobody would even want to make a
trip to Jakarta. Now, we see a couple Pan-Asian Fund set up office in Jakarta,
so competition will be higher and would be greater, I think there would be
valuation issues for top tier transactions and investment opportunities, but
for this large, which is about 60 percent of Indonesian economy is
populated by Small Medium Enterprises, and this is I think attractions
and potentials for homegrown private equity, independent private equity
operator like us in terms of funding of investment opportunities.
I think the big negative
impact is we can’t compete to the another member if we don’t have a strong
fundamental. Globalization make us to be
the International society, so the competition between others will be more difficult.
We
still have many weakness also such as that will be influence our contribution
to ASEAN’s economy such as The poor, unemployment, infrastructure, education,
corruption etc. The poor is always be
the problem not only for Indonesia but also other countries. The poor is always linked with unemployment
and education which mean that the poorness will be decrease if we are an
employment and well educated person.
With good human resources, we can contribute more to the Indonesia and
ASEAN’s economy.
Infrastructure
is also influence Indonesia’s contribution in ASEAN’s economy, because
Indonesia’s infrastructure is still worse, let’s take a look that apple fruit
from China is cheaper than apple from Malang –for example- It’s impossible but
that’s the fact.
What should we
do? In our Contribution to
ASEAN’s economy
The
success of ASEAN signed a charter with a strong foundation for the
establishment of an ASEAN community and strengthen ASEAN’s role in dealing with
a variety of architectural changes in the global cooperation.
How
can Indonesia improve its role and coordinate its position in ASEAN?Although we
have the biggest economy in ASEAN the other members will always compete us –for
example- Thailand, Malaysia, and Singapore.
We have three main key to develop our economy and directly will affect
and give contribution to ASEAN’s economy.
The first one is Domestic Consumption, The second is Infrastructure and
the last is Investment. Let us discuss
the contribution of each main key in ASEAN’s economy.
Domestic
consumption play important contribution.
Not only for the Indonesia but also the ASEAN’s economy. We are the populous country in ASEAN,
automatically our basic need such as Food, clothing, electronic equipments,
etc. also be the biggest in ASEAN. Indonesia
don’t have enough supply from itself, so we must import it from other country
included the ASEAN’s member. I think
import it’s not always be the bad things.
Why I said that?Indirectly we can ‘increasing’ the others economy member
and decreasing the unemployed numbers because the factory will look more people
to increase the production to fulfill the quantity of demand. Although we must be independent to fulfill
our quantity of demand. But we can’t be
a free import country. Shortly, we
‘help’ other ASEAN member’s economy.
Second
one is infrastructure. Many people
things that infrastructure it’s only give contribution to Indonesia. But take a look deeply, if we have a good and
strong infrastructure. It will affect
the other member’s economy directly or indirectly. With good infrastructure in Indonesia, the
poor group will be decreasing fastly, the production will be more efficient and
let’s go back to the first main key –Domestic consumption- will be increasing and it will not only bring the
positive effect for Indonesia but also the others.
The
Last is investment. Our BUMN (Badan
Usaha Milik Negara) is starting the expansion to others member of ASEAN. Directly it will decreasing the unemployment
and increasing the member’s economy. I
think it’s not only BUMN but also BUMS (Badan Usaha Milik Swasta) such
Indofood, Semen Gresik, Lion Air, etc.
They have expand the business in the others ASEAN country. Others ASEAN company is also expand to our
country such as Air Asia, Axiata, etc.
So there is a symbiotic mutualism between Indonesia and the others.
Those contribution in ASEAN’s economy
make us to be always the best country in ASEAN.
As
one of the founders of ASEAN, ASEAN alteration in a challenge for Indonesia to
better show the new ASEAN leadership in order to welcome the establishment of
the ASEAN community in 2015.
There
is no ivory that was cracked, so did the role and leadership of Indonesia in
ASEAN. Therefore, continued to improve leadership in Indonesia and ASEAN in the
interests of our common duty of all to increase the bargaining power of
Indonesia.
Written by Bob Aldi - Accounting students at Padjadjaran University
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