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5G to contribute 9.3% to Indonesia’s 2030 GDP: Study
The benefits can only be realized once the government releases spectrum for 5G from 2021 to 2023.
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Illustration of a 5G-connected city. (Shutterstock/jamesteohart)
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ifth-generation communication technology, also known as 5G, will add Rp 2.8 quadrillion (US$188 billion) to Indonesia’s economy by 2030, making up 9.3 percent of gross domestic product (GDP), a recent study projects.
The study, conducted by the Bandung Institute of Technology's Industrial and Research Affiliation Institution (LAPI-ITB) and commissioned by telecommunications company Axiata Group and Qualcomm International, also noted that 5G could create 4.4 million jobs, and increase productivity to Rp 9.4 million GDP per capita in the next decade.
However, the benefits can only be realized once the government releases spectrum for 5G from 2021 to 2023. LAPI-ITB researcher Ivan Samuels said 5G could actually contribute up to 9.5 percent to the nation’s 2030 GDP if the government rolled out an “aggressive scenario” and made 5G available by 2021.
“If Indonesia fails to meet the 2023 deadline for 5G implementation, then we can lose all of that potential,” Ivan Samuels told an online discussion on Thursday. “The key takeaway for 5G implementation is the faster, the better. By accelerating spectrum availability in the early years, Indonesia can harness greater economic benefits.”
Indonesia has been struggling with freeing up spectrum for 5G as many of its bands are occupied and some bands are bound to agreements enabling the incumbent to use the spectrum until 2024.
The Communications and Information Ministry has planned to free up 1,880 megahertz (MHz) of spectrum to enable 5G network, especially in the middle band ranging from 2.3 gigahertz (GHz) to 3.5 GHz, which can cover a broader area and a provide faster connection.
The head of Indonesia’s 5G taskforce, Denny Setiawan, said during the webinar that the government had included 5G spectrum availability in Indonesia's 2020-2024 National Medium-Term Development Plan (RPJMN). The government is planning to auction off the 2.3 GHz spectrum this year.
