• Restricion of the export of energy commodiies followed by further processing aciviies within the country in order to increase value added exports;
• Implementaion of good mining pracices to minimize environmental damage.
Social Security and Poverty Reducion
The government will assume more responsibility towards implemening a social safeguard system to ensure the beneits of economic development widely shared among the people, therefore the government will
provide: • Social safeguard in the form of targeted economic assistance for the poor, and in the form of universal
social insurance for the public; • Economic assistance can be executed in the form of subsidies and cash transfers targeted to the poor;
• Universal social insurance is implemented through the combinaion of private and community funding. The strategies for poverty alleviaion are based on a broad framework of creaing new employment
opportuniies. In line with this, the following eforts are required: • Improving the availability and access to educaion and skills training to increase naional producivity;
• Creaion of formal employment opportuniies that protect naional workers, and implemented based on
industrial relaions that support fairness between workers and employers; • Protecion of Indonesian workers, as part of social safeguard framework, is given to both formal and
informal sectors; • Improve employment and industrial relaion regulaions to be supporive of both employers and
employees. Poverty alleviaion is a coordinated efort between the government and the society, in which each plays
speciic roles: • The role of society and businesses should be directed toward partnerships with local governments to
solve the real problems of poverty speciic to a certain region; • Businesses can help to reduce poverty by focusing on speciic areas through the implementaion of
corporate social responsibility CSR programs; • The central government further coordinates the activities of government, communities and regions.
B. Improving Regional Economic Potenial through The Development of Six Economic Corridors
Acceleration and expansion of Indonesia’s economic development are based on the development of existing and creating new growth centers. This development strategy is essentially an integration of the
sectoral and regional development approaches. The purpose of developing new growth centers is to optimize agglomeration advantages, to explore regional strengths, and to reduce spatial imbalance of
economic development throughout the country. As part of this strategy, each region will develop their own specific local products.
The development of economic growth centers will be managed through the development of industrial clusters and special economic zones SEZ. This will be accompanied with increased and improved
connectivity between the centers of economic growth major cities and main industrial clusters supported by improved infrastructures including roads, seaports, airports, power, water, and other
related infrastructures. In all, growth centers and connectivity are the building blocks of Indonesia Economic Corridors. Increasing the economic potential of the region through the economic corridors has
become one of the three main pillars of MP3EI.
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Economic Growth Center:
Commercial centers of trading hubs
Supporing Connecivity:
Linking main economic aciviies with supporing infrastructure
Main Connecivity: Linking Economic Centers
Indonesia’s Economic Corridor Development: The development of main economic activities in the centers of economic growth accompanied by strengthening the connectivity between economic centers, the location of the main economic
activities and supporting facilities
Main Economic aciviies:
Economic aciviies prioriized in the economic corridor
Suggested SEZ Connectors Supporing
Infrastructure: Sea Ports, Airports,
Power Supply
Economic Center Industrial Cluster
Main Connecivity Supporing Connecivity
Electricity, Water, and Fiber Opic Development
Sea Port and Airport Electricity, Water, and
Fiber Opic Special Economic Zone
In order to accelerate and expand economic development, it is necessary to create new economic regions outside of the existing economic growth centers. The government will provide special incentives
to support the development of these centers, especially those located outside of Java, and particularly to businesses that are willing to finance the construction of supporting facilities and infrastructures.
The aim of providing such incentives is to encourage businesses to build long term perspectives in the development of the new economic growth centers.
These Incentives shall include: favourable taxation and customs policies, labor regulations, and licensing developed in consultation with the private sector. In order to avoid enclaves in these growth centers,
the central and local governments will encourage strong linkages between growth centers and its surrounding industrial areas. The new economic growth centers may be in the form of large scale Special
Economic Zones SEZs expected to be developed in each economic corridor conforming to the local potentials and specializations of each region.
Development of economic corridors is similar to regional development aimed at creating an integrated and sustainable economic base. However, the development of the six economic corridors give greater
emphasis to economic development as follows: 1.
Indonesia Economic Corridor will emphasize the increase of productivity and value-adding on natural resource management through the expansion and creation of a sustainable upstream and
downstream activity chain;
2. Indonesia Economic Corridor will focus on diverse and inclusive economic development, which connects corridors with other regions to develop opportunities based on local potential and
specialization; 3.
Indonesia Economic Corridor emphasize sectoral and regional development synergies to enhance national, regional and global comparative and competitive advantages;
4. Indonesia Economic Corridor emphasizes integrated economic development between transportation
and logistics, as well as communications and information systems to open regional access; 5.
Indonesia Economic Corridor will be supported with fiscal and non-fiscal incentives, ease of regulation, licensing, and optimum public services from Central and Local Governments.
Figure 2.1. Economic Corridors
SEZ SEZ
SEZ
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C. Strengthening Naional Connecivity
The success of the MP3EI highly depends on the strength of naional and internaional economic connecivity intra and inter region. With this consideraion, the MP3EI has ideniied the strengthening of naional
connecivity as one of three main pillars.
Naional connecivity consist of 4 four naional policy elements i.e. Naional Logisic System Sistem Logisik Nasional
Sislognas, Naional Transportaion System Sistem Transportasi NasionalSistranas, Regional Development RPJMNRTRWN, and Informaion and Communicaion Technology ICT. These policies were
combined in order to create an efecive, eicient, and integrated naional connecivity. Indonesia’s naional connecivity is part of the global connecivity. Therefore, the strengthening of the
naional connecivity has to consider Indonesia connecivity with regional and global economic growth centers in order to enhance naional compeiiveness and opimize advantages of Indonesia’s regional and global
connecivity.
Elements of Mobility Management in the Naional Connecivity
Naional Connecivity includes 5 ive elements as follows: 1. Personnelpassengers, which covers the management of the mass movements of people travelling within,
to and from the region; 2.
Abioic materialsgoods physical and chemical materials which includes the movement of industry and industrial products;
3. Bioic materialelementspecies, which includes the movement of live products, such as catle, biotoxins,
veral, serum, verum, seeds, bio-plasma, biogen, bioweapon; 4. Services and Finance, which covers technology mobility, human resources and capital development for the
region; 5.
Informaion, concerning the mobility of informaion for the beneit of regional development which is strongly associated with the competency of informaion and communicaion technology.
The improvement of mobility management on ive elements above will enhance naional capacity to accelerate and expand development as well as to achieve quality growth as mandated by Law No. 17 Year
2007 on the Naional Long Term Development Plan 2005 - 2025.
Indonesia, a Mariime Naion
The total length of Indonesia coast line is 54,716 kilometers. It stretches along the Indian Ocean, the Strait of Malacca, South China Sea, Java Sea, Celebes Sea, Moluccas Sea, Paciic Ocean, Arafura Sea, Timor
Sea, and in other small regions. Embedded within the Indonesian archipelago, there are several sea lines considered as economically strategic sea lines and global strategic military sea lines. These sea lines are the
Straits of Malacca which is the Sea Lane of Communicaion or SLoC, the Sunda Strait ALKI 1, the Straits of Lombok and Makassar Straits ALKI 2, and the Strait of Ombai Wetar ALKI 3. Most of the world’s major
shipping and cruise liners pass and use these sea lanes as part of their shipping routes.
MP3EI priority is to maximize uilizaion of SLoC and Indonesia Archipelagic Sea Lanes Alur Laut Kepulauan Indonesia
ALKI menioned above. Indonesia could take beneits from these mariime advantages. It can begin by acceleraing growth in various regions in Indonesia especially in eastern Indonesia, improve a mariime
compeiiveness, and enhance naional security and economic sovereignity of Indonesia.
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Indonesia’s Frontline Global Connecivity
In order to strengthen national connectivity that considers regional and global geo-strategic position, global connectivity must utilize SLoC and ALKI to support the implementation of MP3EI. This concept will
form the backbone of national connectivity strategy and also it is expected to facilitate more equitable economic development across Indonesia and create a solid economic independence and economic
competitiveness.
ALKI-I ALKI-II
SLoC MALACA
ALKI-III ALKI-III B
ALKI-III C
Strategic Framework and the Policy of Connecivity Strengthening
The aims and objecives of the Naional Connecivity Strengthening are: 1.
Connecing the centers of major economic growth based on the principles of integraion and not similarity, through “inter-modal supply chain systems”.
2. Expanding economic growth through accessibility improvement from the centers of growth to the
hinterland.
Figure 2.2 Concepts of Gate Port and
Internaional Airport in The Future
Internaional Airports Alternaive Internaional Sea Ports Hub
Main Internaional Sea Ports Sea Lane of Communicaion SLoC and ALKI
Primary Naional Sea Lane Secondary Naional Sea Lane
Primary Land Lane Roads andor Railways Primary Sea Ports
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Kuala Tanjung Bitung
Makassar
