Indonesia President Prabowo Subianto. — Reuters
JAKARTA: The government will pursue an average growth of 10% in investment annually over the next five years, including building up the chipmaking industry, in a move deemed key to achieving President Prabowo Subianto’s ambitious 8% economic growth target.
To meet the gross domestic product growth target, Prabowo’s administration will also pursue around 9% growth in exports, while maintaining household consumption between 5% and 6% over the next five years.
During a national coordination meeting on Wednesday, Coordinating Economic Minister Airlangga Hartarto said the government would also develop downstream industries, the digital economy and the semiconductor industry as additional key drivers of growth.
This marks a shift, as Indonesia’s last 8% growth occurred in 1995, when it relied on crude palm oil, textiles, and oil and gas.
One potential downstreaming programme, he said, involved the utilisation of silica sand that can be turned to high quality float glass for the solar panel industry essential for the energy transition, currently being carried out in Kendal, Central Java and Gresik, East Java.
He said the country must push investment in the semiconductor industry, urging an end to the reliance on exporting commodities and raw materials.
However, he noted that the chip manufacturing industry is highly competitive, given that the United States and European countries view China’s dominance in the supply chain as a “wake-up call”.
“We hope to be able to provide facilities, such as in Batang and others, but we need to also build the ecosystem.
“Semiconductors are crucial, because in the future with the digitalisation era, there will be no equipment without semiconductors, whether it’s in appliances or automobiles, even motorcycles,” he explained. — The Jakarta Post/ANN
