Kadin Launches White Paper, Encouraging 4 Pillars To Pursue 8% Economic Growth

Kadin Launches White Paper, Encouraging 4 Pillars To Pursue 8% Economic Growth

Wednesday, 27 Nov 2024

The Indonesian Chamber of Commerce and Industry (Kadin) has launched a White Paper outlining four key pillars that the government should implement to achieve an 8% economic growth target. This White Paper serves as a strategic document providing guidance and policy recommendations regarding the direction of Indonesia's economic development aimed at reaching the specified growth rate.

Arsjad Rasjid, the Chairman of Kadin Indonesia, stated that the document addresses the challenges and primary initiatives necessary to resolve these issues, ensuring its relevance to Indonesia's circumstances over the next five years. He emphasized that this White Paper could serve as a framework for collaboration between the business sector and the government to foster an inclusive and sustainable economy.

Within the White Paper, Kadin Indonesia has articulated four strategic pillars: enhancing resilience, promoting welfare, strengthening inclusivity, and advancing sustainability. These pillars are further detailed through key initiatives designed to facilitate the achievement of the 8% economic growth target. Rasjid noted that these initiatives have the potential to increase the Gross Domestic Product (GDP) by 7-8% annually. Kadin has also projected a cumulative GDP increase of approximately US$450-500 billion from all key initiatives between 2024 and 2029.

The analysis identifies seven primary growth themes that could contribute over 80% of the estimated total GDP impact during the 2024-2029 period. These priorities encompass sectors such as health infrastructure, energy resilience, small and medium enterprises (SMEs), manufacturing, green and sustainable business practices, and food security.

Additionally, Adrian Dimitri from the Boston Consulting Group remarked that the government must unlock the economic potential present in each region to achieve the targeted 8% growth. He pointed out that every region in Indonesia possesses unique characteristics related to demographics, commodities, and energy resources, which can significantly contribute to growth and development. Currently, however, Indonesia's economy remains concentrated in Java.

Adrian anticipates that Indonesia's economic center will shift towards the eastern region, focusing on critical minerals, agriculture, fisheries, oil and gas, and energy. "The development of each region will be crucial. Each of the largest regions and islands in Indonesia will have its own focus," stated Arsjad in Jakarta on Tuesday, November 26, 2024.

For instance, Sumatra has the potential for continued growth, particularly in palm oil plantations, coal, and oil and gas sectors. "In general, Indonesia possesses all these resources; it has a market, energy sources, natural resources, and a labor force. Everything is complete. The challenge lies in how we unlock this potential, which is rarely found in other countries," he remarked.

He further emphasized that as one of the largest economies, Indonesia must prioritize strategic sectors to achieve inclusive and sustainable economic growth. Therefore, he believes that an economic growth target of 8% is not unattainable. "An 8% target is not impossible; we can achieve it, even though in recent years we have been relatively stagnant at 5-6%," Adrian stated. Meanwhile, William Sabandar, Chairperson of 5P Global Movement Indonesia, highlighted the importance of strengthening inclusivity to support sustainable economic growth through various approaches, including social, political, governance, economic, ecological sustainability, cultural and social aspects, as well as security and stability. He also mentioned that an 8% economic growth could be realized alongside ongoing development efforts. (ferry@insightinnews.com)

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