Thursday, July 31, 2014
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Indonesia Economic Masterplan 2011-2025

The Masterplan or MP3EI is a preliminary step for Indonesia to accelerate and expand economic development in order to support its transformation to a developed country by 2025. This will be done through "inclusive, just and simultaneous economic prominent growth". To achieve that goal, the economic growth should be 7-8% annually. The private sector will have an important role in implementing the Masterplan, in investment, production and distribution, together with the Government who will act as the regulator and also as a facilitator, and with strengthened coordination among related ministries and regional government.

The Masterplan includes three main elements:

(a)      developing six Indonesia economic corridors, by establishing centres of development within every corridor and developing industry clusters and special economic zone based on advanced commodities resources;

(b)      strengthening national connectivity, which includes intra and inter connectivity of centres development, intra-islands (corridors), and international trade;

(c)      national science and technology acceleration to support the development of the main program.

In implementing the Economic Corridors, economic development will focus on the synergy of sectoral and regional development to increase benefits nationally. The Economic Corridors also focus on the infrastructure development which will emphasize the cooperation between the Government and private sectors. The implementation of the Economic Corridors is expected to result in acceleration and expansion of economic growth, with needs in infrastructure development for phase one (2011-2014) being estimated at USD 150 billion. As the facilitator, the Government will give fiscal and financial incentives, project guarantee, prepare related agencies, strengthening the applicable law and regulations framework, and public service as well as Project Development Facility (PDF) preparation.

What is the Relevance?

With the Masterplan the Government clearly states that it will take a strong position not only as the regulator, but also as the facilitator and function as "a catalyst for growth". With this fresh approach from the Government, the time is ripe for the private sector to engage in a deeper dialogue than previously seen, in order to jointly work towards the goals outlined. One of the key opportunities with the Masterplan is that the Government will amend or remove regulations that inhibit the implementation of investments, and potentially also those that hamper increased trade and smoother flow of goods. This "debottlenecking" process is a key factor, as the Government will require and request the input from private sector to primarily identify but also to find solutions to the problems at hand. The working team of the Masterplan consist of Echelon 1 officials, in key Ministries such as Coordinating Ministry of Economic Affairs (MENKO Perekonomian), EuroCham will deepen the cooperation/dialogue with MENKO Perekonomian for the implementation of the Master plan, especially with regards to "debottlenecking" of regulations to facilitate increased investments and smoother flow of goods.

More comprehensive information about the Master plan, its Economic Corridors and related subjects are available from the EuroCham office upon request.

The Master plan document can be downloaded from the website of the Coordinating Ministry of Economic Affairs:

http://www.ekon.go.id/media/filemanager/2011/07/06/c/o/compressed-mp3ei-bahasa_final.pdf  - Bahasa Indonesia version

http://www.ekon.go.id/media/filemanager/2011/07/06/m/p/mp3ei-english_final.pdf  - English version

 

 

EuroCham

European Business Chamber of Commerce in Indonesia (Eurocham)

Wisma Metropolitan 1, 13th Floor Jl. Jend Sudirman Kav. 29-31 Jakarta 12920 Indonesia

Phone: (62 21) 571 0085

Fax: (62 21) 571 2508

Email: info@eurocham.or.id 

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