New industrial policy centers on technology
New industrial policy centers on technology
JAKARTA (JP): The government announced on Friday it was
adopting a new industrial policy that would boost the use of
technology as a means to improve the nation's competitiveness.
Minister of Industry and Trade Luhut Pandjaitan said the new
policy would become the government's guideline in designing
future trade and industrial policies.
"It'll be a smart book that contains our grand strategy for
our national industries," he told reporters at a media briefing.
Based on the policy's draft, the nation's economy would grow
from an agricultural-based economy to an industrial and finally a
technology-based economy.
Luhut said that with the new policy the government would have
a clear direction of where the economy was heading.
To achieve this aim, he said, the government would adopt what
was called the "industrial cluster concept".
The concept groups industries based on one core industry, such
as the cigarette industry, which has several supporting
industries like the packaging and marketing industries, that
depend on the growth of the cigarette industry.
"This way, we can identify each industry down to its
descendants," Luhut said.
The draft identified five categories under which potential
industrial clusters could be developed: natural-resource based
industries, labor intensive industries, capital intensive
industries, technology intensive-based industries and policy
driven-based industries.
The draft said that global competition required Indonesia to
improve the competitiveness of its industries on an international
level.
But Indonesia's competitiveness out of 47 countries dropped to
46 in 1999, from 40 in 1998, according to the Institute for
Institutional Management Development (IIMD).
To lift its ranking, the draft said, Indonesia must improve
the technology content of its export products.
According to the draft policy, most export-oriented
manufacturing companies were not using modern technology in their
production activities.
Based on a survey by the Organization for Economic Cooperation
and Development, only 3.56 percent of Indonesia's total export
volume in 1998 was based on medium and high technology.
Whereas, the World Economic Forum ranked Indonesia at number
48 out of 53 countries in applying research and development
technology.
"Thereby, Indonesia can only be regarded as a follower rather
than a technology leader," the draft said.
The draft further proposed the establishment of a national
council of international competitiveness that would design
policies related to increasing the country's competitiveness.
It also suggested a cluster working group, whose job would be
to develop industrial clusters.
Luhut said that new government regulations would follow to
support the policy once it was completed.
He said the government was about to finalize the policy and
only needed to publicize the draft for more input.
"We just need to report to the President on the progress we've
made," he said, adding that the draft only awaited the
President's approval.
However, he said he would also invite associations from
various industries and several universities to discuss the new
national policy. (bkm)