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BI calls for smart cities development to boost economy
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The Jakarta administration applies a smart city concept that enables residents to report and find information on public facilities in the capital. (Photo taken from smartcity.jakarta.go.id/-)
B
ank Indonesia has called for the development of smart cities throughout the country in a bid to boost the economy amid a fast-growing population and low quality urbanization.
According to the United Nations World Urbanization Prospects (2014), the Indonesian population grew at a faster rate than the global population. While the global population recorded annual growth of 1.27 percent, Indonesia’s population grew 1.35 percent per year.
Likewise, the country's urban population grew 3.51 percent annually, higher than the global urban population, which increased 2.24 percent per year. Unfortunately, in Indonesia high urban growth has not led to stronger economic growth.
BI director of economic and monetary policy Arief Hartawan said the amount of infrastructure in a city should make individuals and companies increase productivity, innovation, business and economic growth.
"It means we need to improve the quality of urbanization in the future, since we are no better than the Philippines […] One thing that we must push is electronic-based urban development," Arief said in Jakarta on Thursday.
In Indonesia, 1 percent of urbanization accounts for only 2 percent of gross domestic product (GDP) per capita, according to a 2012 World Bank report. In Thailand, Vietnam and India it contributes 10 percent, 8 percent and 6 percent GDP per capita, respectively.
Most people who migrate to the cities in Indonesia, Arief further said, are unskilled workers whereas skilled worker preferred to live in other areas or countries.
As part of efforts to accelerate development in urban areas and their surroundings, as well as to develop smart cities and a stronger e-commerce industry, BI will hold a coordination meeting with the central government and local administrations on June 2.
BI head of the Jakarta region Doni P Joewono added that the central bank and the Jakarta administrative would also hold a "smart money, smart city festival" to make Jakartans more familiar with non-cash transactions.
"We will launch a multi-function card, Jakarta One, as Jakarta smart city card tomorrow,” he said.
BI director Pungky Purnomo Wibowo said the card could be used to access public services in Jakarta, as well as to support Jakarta administration programs. "The Jakarta One card is designed as a media identity, electronic money and as a savings account," he said. (ags)
