Manufacturing, Service Sectors Need Expanding, World Banks Says
21 June 2016 12:52 WIB
TEMPO.CO, Jakarta-The World Bank urges Indonesia to expand the national manufacturing and service sectors. Indonesia's role in the manufacturing sector has been relatively stagnant in the last 15 years with an average in growth rate of just 0.6 percent.
The World Bank says Indonesia has been too dependent on the now sluggish commodity sector, and ignores the manufacturing and services sectors that actually can "provide jobs that require skill and offer high salaries," World Bank Country Director for Indonesia Rodrigo Chaves said here on Monday, June 20.
In the 1990s, Indonesia enjoyed the support of the manufacturing industry, allowing the economy to grow with a rate of 11 percent per year.
"In recent years, the growth has been just around four percent per year," he said.
Chaves said compared to other ASEAN countries, Indonesia's manufacturing development is way behind. Moreover, the national manufacturing exports are dominated by low-tech products, smelting material, and assembly. As a result, the country is vulnerable to risks if multinational companies decide to move from Indonesia.
BAGUS PRASETIYO | GHOIDA RAHMAH