A World Economic Forum (WEF) report says Indonesia is the most competitive nation in the G20 economic grouping, despite challenges.
The WEF’s inaugural Indonesia Competitiveness Report, based on the 2010-2011 Global Competitiveness Index (GCI), was launched on Wednesday ahead of the 20th WEF on East Asia in Jakarta next week.
The report ranked Indonesia 44 of 139 nations covered by the GCI, the highest of all G20 nations and up ten places from its ranking in the previous index.
“These positive developments are, to a large extent, reflected in the country’s competitive performance. Indonesia should not be complacent, though. Many shortcomings persist and robust growth might exacerbate them,” WEF economist and lead author of the report Thierry Geiger said.
The report identified infrastructure as a “glaring” shortcoming in Indonesia. “Ports, roads and railroads are in poor condition. The electricity supply is extremely unreliable and scarce. The uptake of information and communication technology remains limited among businesses, as well as within the population at large.”
The report said widespread corruption also hindered the nation’s competitiveness. “Indonesia must continue strengthening its institutional framework. Corruption remains widespread, while greater transparency and predictability are needed in the policy-making process.”
Indonesia must also address an alarming public situation, a rigid labor market, the poor access and quality of higher education, bureaucracy and trade barriers to increase its competitiveness, according to the report.
“One step to improve Indonesia’s trade competitiveness would be to further integrate ASEAN,” according to a WEF statement.
Indonesia will host the WEF on East Asia for the first time on June 12 to 13 in Jakarta. More than 600 participants are expected, including President Susilo Bambang Yudhoyono and other heads of states, government ministers, leaders of international organizations, business executives, political figures and religious leaders in the region.
The forum will focus on Asia’s leadership agenda, global risks, sustainability and green growth and regional competitiveness in a global economy.
Established in 1971 by several companies in Europe, the WEF is a Swiss non-profit foundation known for hosting the more famous Davos forum.
