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nhancing the information, communications and technology (ICT) sector will improve the chances of Indonesia, becoming a global economic powerhouse, as the sector can foster both economic growth and social development in the country, major consulting firm, McKinsey & Company, says.

McKinsey has found that for every 10 percent increase in broadband penetration, the positive impact on GDP growth is 1.21 to 1.38 percent.

'€œA better ICT ecosystem will increase the chances of Indonesia becoming one of the world'€™s top-10 economies,'€ McKinsey & Company Indonesia president director Phillia Wibowo said on Monday.

McKinsey'€™s previous report found that Indonesia needed to boost its productivity by 60 percent, something that could be achieved by boosting its ICT sector '€” among other things, she told The Jakarta Post.

In an earlier report titled The Archipelago Economy: Unleashing Indonesia'€™s Potential, McKinsey stated that Indonesia had the potential to become the world'€™s seventh-largest economy by 2030 surpassing Germany and the UK, if its economic growth hit around 7 percent each year.

The report said the country must boost its labor productivity by 60 percent over the level recorded between 2000 and 2010 to meet the 7 percent annual economic growth target.

'€œWe see the ICT sector as one of the important factors in boosting productivity, as every ICT job creates about three jobs in other sectors,'€ said Phillia.

Michael Gryseels, McKinsey & Company senior partner, said that what the country needed to boost its ICT sector was to develop a vibrant ICT ecosystem, use ICT to foster economic growth and use ICT to enable sustainable development.

'€œOne of the ways to create a vibrant ICT ecosystem is by resolving major infrastructure bottlenecks and improving reach, cost and bandwidth,'€ he said.

The government is currently on its way to carrying out a US$22 billion-broadband project in an effort to increase broadband access in both urban and rural areas.

The project, which will be carried out until 2019, will increase the country'€™s Internet penetration as broadband access will be available at affordable prices.

Gryseels said the country also needed to stimulate the adoption of ICT by small-medium enterprises to boost economic growth.

The number of small-medium enterprises amounted to over 55 million in 2012, providing jobs for about 108 million people and contributing roughly 60 percent of the country'€™s total GDP, according to McKinsey & Company.

'€œIdeally, small companies need to invest between 3 and 4 percent of their revenue in ICT spending [to boost performance],'€ Gryseels added.

Previously, Nick Taylor, ASEAN'€™s technology lead at consulting firm Accenture, said companies had to embrace technology-change to protect their businesses from non-traditional competitors, such as between global telecommunications operator Vodafone and webchat application Skype in providing communications services.

Companies could either cut costs to provide special funding or build partnerships with other companies for their ICT development, he told the Post.