Despite being a country that has good atmosphere for investment, Indonesia’s economic growth is relatively slow because there are problems such as huge social gap and infrastructure quality. According to Peter Sondakh, owner of Rajawali Citra Televisi Indonesia and several mining companies and international hotels, bad infrastructure and the lack of job opportunities are the main causes of why Indonesia economic growth is slow. He proposed the new building of infrastructures as well as the opening of formal job opportunities as ways to improve Indonesia economy.
Better Infrastructure as Key to Economic Growth
According to Peter Sondakh, whose businesses spread from Jakarta to Papua, infrastructure is one of the most important things that support Indonesia economy. He gave example of people who chose to buy cheap imported products instead of local products, since poor access has rendered these local products rare and more expensive than imported goods. For example, bad roads make many local craftsmen unable to sell their products with cheaper price to people in the cities.
As an owner of palm oil business, Peter Sondakh also gave example of many local oil palm farmers that are unable to sell their products well because of bad infrastructures such as roads and bridges. Therefore, they depend on loan sharks or must lower their prices drastically so people will buy their products. In this case, better infrastructures that give them access to market will be beneficial for farmers and local customers as well as industries. This also applies to other fields of businesses and industries, especially for those in remote areas.
More Job Opportunities
Another benefit of building new infrastructures, according to Peter, is the increase of job opportunities people can get. Also, with new infrastructures being built, the development acceleration will be faster and this will improve economic growth and dynamic. However, the job opportunities should be from formal sectors, and something that require at least short training to improve the values of local workers. Therefore, there will be more local people with skills and knowledge that can gain opportunities to work, and industries can reduce outsourcing.
Also, government has responsibilities to provide education and training centers that will provide more people with opportunities to improve their skills and knowledge in various industry fields. With combination and synergy between good infrastructure, more job opportunities and more education as well as training, Peter believes that Indonesia’s economy can rise to double digits.