Jalu Dibyo Sanwasi | Staff Divisi Kajian Kanopi FEUI 2012 | Ilmu Ekonomi 2011
Pessimism has not been an uncommon phenomenon within the Indonesian society. One can often hear remarks that belittle many aspect of Indonesia, especially Indonesia’s economy, in everyday conversations. Unjust comparisons between the Indonesia’s developing economy and the glamour of advanced economies usually lead to the burial of Indonesia’s economic prospects. Furthermore, terms like “Indonesian economic sector is doomed because neo-liberals have infiltrated our borders” have also contributed to this collection of negativity. However, are all of these negativities true?
Lets look at what has happened to Indonesia within the last couple of years. Indonesia’s GDP has grown by an average more than 5.5% since 2005, and most recently by 6.5%. Among many, investments have had considerable contributions to the growth as seen in the increase of rate from around 22% GDP in 2000 to around 33% GDP in 2010. This growth has brought great things for Indonesia, including prosperity.
Over the years, Indonesia has also seen a growth in prosperity. Indonesia’s middle class is steadily rising. In 1999, the middle class only makes up for fewer than 20% of the population and this number has increased to almost 40% by 2009. Indonesia’s wealth equality has also improved, indicated by the decrease of the Gini coefficient from around 0.4 in 2005 to around 0.37 in 2009. In accordance to the words and numbers above, Indonesia’s current economic situation is far from grim. However, how does the future look for Indonesia?
Several years ago, 2005 to be exact, Goldman Sachs made a prediction on several global economies that is called Next Eleven. According to the prediction, Indonesia will be one of 11 countries, which also includes Mexico and Turkey, which will have potential global impacts similar to BRICS in rivaling the G-7. The forecast, unsurprisingly, included several delightful prospects for Indonesia.
Among them, Indonesia’s GDP is expected to grow on total average of more than 4% until the year 2050 when Indonesia will be the 7th largest economy in the world in terms of GDP. In competing with the G-7, Indonesia is projected to rival all but the largest of the G-7. Furthermore, prosperity in Indonesia is expected to increase, indicated by a GDP per capita of $23,090. All in all, according to this report, Indonesia’s future is not all that bleak.
As one can see, although Indonesia has faults, not all of the pessimisms are true. Of course Indonesia falls behind in many things if one compares it to developed nations. Indonesia is, after all, still in the process of development. On the other hand, Indonesia’s economic sector has shown great signs of development that is projected to persist into the future. Clearly, Indonesia’s economy is far from doomed.