the six economic corridors
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7/29/2019 The Six Economic Corridors
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The Six Economic Corridors
Sulawesi
Lying in the center of Indonesia, the Sulawesi Economic Corridor is poised to be the center of
agricultural production, fisheries, oil and gas, and mining.
The agricultural sector, the largest contributor to the region, is hindered by a lack of adequate
economic and social infrastructure. The Master Plan targets optimization of land use, the
creation of new rice paddy fields, and the rehabilitation and conservation of agricultural land.
Sulawesi is the biggest fishery products producer nationally. In response to the challenges of
overfishing, the Master Plan aims to develop aquaculture and increase added-value products and
activities.
Nickel production is the most advanced in Indonesia. However more growth is sought in
downstream industries such as nickel product refining. Oil and gas reserves are considered to be
low, these need to be properly identified and explored.
Bali
The Bali-Nusa Tenggara Economic Corridors obvious strength is tourism, together with
agriculture which is linked to a strategy to maintain a green, all-organic economy.
The corridor accounts for 15% of national hotel capacity Bali alone accounted for 40% of
tourist in 2010 however overall average tourist spending per day, and length of stays, is low
compared Thailand and the Maldives. The Master Plan therefore plans to realize untapped
potential in these areas through improved security, better marketing and development of new
tourist destinations.
The potential for MICE (meetings incentives, conventions and exhibitions) has also identified,
with two provinces the focal point for marketing efforts. Investment in infrastructure such as
airports, road and rail networks has also been highlighted in the Master Plan.
Java
Home to the nations capital and over half the countrys population, Java will develop into a
service-based economy, the main focus being on the food and beverage industry, textiles,
transportation equipment, shipping, ICT and defense equipment.
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The food and beverage sector is the biggest employer. As import duties on raw materials come
down, and tariffs on end products rise, the sector will receive an added boost. In textiles, a
domestic cotton industry could help develop an emerging garment design industry in Jakarta.
Java accounts for 80% of Indonesias equipment and machinery sector. The Master Plan aims to
boost car sales at home and abroad and harmonize automotive industry standards to enable
competition on a global level. Shipping and defense are both key industries and mandated for
further development.
ICT development is essential to improve competitiveness and create a knowledge-based
economy. Expanding broadband access and harmonizing policies and government programs will
help expand the use of ICT in economic activity and build digital content industries.
SumatraHeralded as the center for production and processing of natural resources and the nations
energy reserves, the Sumatra Economic Corridors strategic location also positions it as
economic gateway to the European, African, South Asian, East Asian and Australian markets.
To boost its core strengths of palm oil, rubber, coal, steel and shipping, Sumatra needs to
significantly upgrade its infrastructure, finance and human resource development. Palm oil and
rubber production are hampered by low productivity due to low seed quality and non-optimal
land utilization, among other things. Investment in research, training, financial assistance,
education and infrastructure will help develop the sector.
Coal, shipbuilding and steel are also expected to benefit from updated and expanded
infrastructure such as the Sunde Straits Bridge connecting the island with Java.
Kalimantan
Kalimantan has abundant resources, with oil and gas and mining contributing around half of thetotal GRDP. However production has declined so there is increasing pressure on other sectors,
namely coal, palm oil, steel, bauxite and timber.
As Indonesias demand for oil grows, the Master Plan proposes promoting exploration of new oil
and gas fields, as the Kalimantan Economic Corridor is known to have large reserves. It also
contributes 37% to the countrys total production of liquefied natural gas.
Investment in the powerful coal sector is expected to raise production more then sixfold. Oil
palm plantations occupy 53% of the total plantation area in the region, and the focus will be on
increasing production as further expansion is limited.
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In the mining sector, the focus will be on creating a self-sufficient steel industry and downstream
production capabilities. The home of vast forested areas, the potential for the timber sector is
huge, as we as the opportunity to develop non-timber products such as fruits, silk and bamboo.
PapuaThe Papua-Kepulauan Maluku Economic Corridor will focus on five economic activities: food
agriculture, copper, nickel, oil and gas, and fisheries.
Its flat, fertile terrain is ideal for food production. The MIFEE (Merauke Integrated Food and
Energy Estate) program consists of large-scale cultivation of crops by adopting the concept of
agriculture as an industrial system based on science and technology, capital, and modern
organization and management. Activities range from food crops, horticulture, and animal
husbandry to plantation and aquaculture. The Master Plan will nurture and develop MIFEE with
investment in infrastructure, research and education.
In mining, Indonesias third copper smelter will send production into surplus, and focus on
added value activities for nickel will attract more investments in nickel mining and exploration.
Oil and gas production will be optimized by balancing capacity of exports and imports and fine
tuning legislation and licensing.
In fisheries, tremendous opportunities in developing aquaculture, and investment in ports,
marketing and power generation should help boost the industry.
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