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Jakarta Post

Indonesia’s best bet for growth is services: Government

  • Norman Harsono

    The Jakarta Post

PREMIUM
Jakarta   /   Tue, August 27, 2019   /  07:30 am
The Jakarta Post Image
A barista participates in a Creative Economy Agency (Bekraf) certification event in West Jakarta on Aug. 7. The service sector contributed 54 percent to the economy last year, absorbed 55.1 percent of the workforce in 2017 and growing an average of 7.1 percent annually between 2010 and 2017.(JP/Donny Fernando)

An overlooked reason as to why the country’s economic growth has hovered at about 5 percent since 2013 may be because calculations have never thoroughly taken into account all service sector activity. Such a thought-provoking but simple notion has been in the back of the mind of the government for a couple of years and efforts are being made to better capture the local service sector, which has high export potential amid the sluggish global economic growth that has dampened demand for Indonesian products. The Office of the Coordinating Economic Minister and Jakarta-based think-tank Indonesia Services Dialogue (ISD) have been quietly pushing 27 ministries and state institutions to more exhaustively capture service sector data, including on service exports, which is necessary to ease current account deficit pressure as well as formulate more accurate policies and trade deals. ...