'RI faces complex problems in economy'

JAKARTA (JP): Minister of Industry and Trade Tunky Ariwibowo acknowledged yesterday that Indonesia faces a complex and interrelated range of problems as the nation seeks to move forward with its development plan.

Tunky said that some of the problems such as the inadequate industrial base, a narrow-export base, and under-development of regions outside Java, Bali and Sumatra, were inherited from previous development periods.

"Others represent new challenges already at hand, or those which are expected to emerge in the years ahead," he said in his written speech at a trade and investment seminar held here by the Asian Region International Association of Cooperating Organization.

The minister's speech was read by his expert advisor Bakir Hasan.

These problems are addressed in the country's second long-term (25-year) development plan, which began in 1994, he said.

Indonesia fully understands that the world in the coming century will be full of rapid changes as a result of the globalization of the economy, technological progress, and the increasingly rapid flow of information, he said.

"Whether we are ready or not, we enter the new information era. We must prepare for the new era. Otherwise, we will be left behind in the development process," he said.

Indonesia has prepared to face the changing world by becoming more sensitive and proactive to developments nationally, regionally and globally, said Tunky.

The second 25-year development plan builds on previous gains and calls for further progress on a wide spectrum of economic, industrial and social endeavors.

"Priority is given to the development of human resources and mastering of technology," he said, adding that key economic targets include expanding economic growth initially from over 6 percent to at least 8 percent annually.

To enter the trade globalization era in the 21st century, Indonesian industry must have the capacity to produce goods and services that compete with world price and quality.

Indonesia must continue with economic reforms to encourage industrial enterprises to restructure, modernize and achieve higher productivity, he said.

Indonesia's industrial base must be strengthened and industrial linkages must be widened, he added.

"This is very important. Unless the supporting industries are developed, downstream industries will continue to depend on imported materials and components," he said.

Industrial enterprises must make much greater efforts to access global technologies in order to enhance the country's technological capability.

Labor and natural resources alone will not assure trade advantage and industries must have technology, "not just the technology that uses the hands but the technology that challenges the mind," he said.

The minister said workplaces, from factories to offices, must be restructured to make full use of information tools in their operations. (hen)