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Indonesia

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Indonesia can claim many economic and political achievements over the last 15 years: the country posted consistently high economic growth rates, joined the G20, stabilised its young democracy, and devolved budgetary power and decision making. Extending this track record further depends on Indonesia’s ability to deliver sustainable and sufficient energy supply to markets and ultimately to consumers. Even though it remains a net energy exporter due to the expansion of its coal and liquid biofuel production, the country is consuming more energy as a result of rising living standards, population growth and rapid urbanisation. Indonesia is already highly dependent on oil imports. Meeting demand growth and ensuring the environmental sustainability of energy supplies must remain key pillars of its economic and investment policies and strategies. Indonesia has implemented important changes since the IEA published its first review of the country’s energy polices in 2008. Key milestones include the 2007 Law on Energy, the 2008 National Energy Policy, the 2009 Law on Electricity, and the 2009 Law on Mineral and Coal Mining. However, the government needs to continue this reform process vigorously and implement further improvements to Indonesia’s institutional set-up, alongside stronger policy planning and implementation, more investment in critical energy infrastructure, and continued movement towards regulated energy markets and cost-reflective pricing. This review analyses the energy policy challenges facing Indonesia and provides critiques and recommendations for further policy improvements. It is intended to help guide the country towards a more secure and sustainable energy future.

Energy --- Indonesia

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Indonesia has a very good record of poverty reduction, having halved its incidence over the past two decades. Nevertheless, almost 30 million people still live below the national poverty line, mostly in rural areas and in certain provinces. In order to make further progress in lifting these people out of poverty and economic vulnerability, policy needs to focus on generating strong, inclusive and sustainable growth. Pro-poor growth can assist in the process of economic convergence by facilitating the migration of workers out of the low-productivity agricultural sector into the industry and services sectors. By putting in place the right fundamentals, such as a well-designed and inclusive education system, efficient infrastructure and a stable macroeconomic environment, Indonesia will have decades of strong growth ahead by virtue of economic convergence with frontier countries. This has the potential to lift millions more out of poverty without exacerbating income inequality. Moreover, it will set Indonesia up for the next phase of innovation-driven growth that will propel it into the ranks of high income countries. While existing poverty reduction programmes have become increasingly effective, more resources are required, and efficiency could be further enhanced, especially through better targeting. The distribution of income has become markedly more unequal over the past decade and needs to be kept in mind when formulating growth policies. This Working Paper relates to the 2015 OECD Economic Survey of Indonesia (www.oecd.org/eco/surveys/economic-survey-indonesia.htm)

Economics --- Indonesia

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Indonesia abounds with natural resources. But the unique nature of its geography, coupled with the lack of transport infrastructure, makes their exploitation challenging. Moreover, a lack of investment, protectionism and an unwieldy regulatory environment are all inhibiting the sector from reaching its full potential. Agriculture has been held back by low productivity, under-investment, unclear property rights on land, ill-advised trade regulations, misplaced support for staples and restrictions on foreign ownership. By pursuing crop diversification, encouraging co-operation between smallholders and large estates and easing constraints on foreign investment, Indonesia could raise its farmers’ productivity. Fossil fuels have become central to Indonesia’s energy policy and its main source of export revenues. Growing environmental concerns, both domestically and internationally, combined with subsiding coal prices and the on-going shale gas revolution, call into question the sustainability of such a strategy. Indonesia should increase its energy efficiency and further develop gas to plug the gap until sufficient renewable energy, especially geothermal, comes on line. Government control over the oil industry via state-owned Pertamina should be gradually reduced. Clarifying, streamlining and publicising simple regulations in energy and minerals, especially regarding land rights and on-shore processing, and removing foreign-ownership restrictions will help bring much needed investment. The pressure on the environment that natural resource exploitation is creating should be addressed by increasing the share of gas and renewables in the energy mix, properly defining property rights and regulations regarding forest land, and implementing a positive implicit carbon price. More resources should be devoted to combating widespread illegal mining and deforestation. This Working Paper relates to the 2015 OECD Economic Survey of Indonesia (www.oecd.org/eco/surveys/economic-survey-indonesia.htm)

Economics --- Indonesia

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"This third edition of Historical Dictionary of Indonesia contains a chronology, an introduction, appendixes, and an extensive bibliography. The dictionary section has more than 900 cross-referenced entries on important personalities, politics, economy, foreign relations, religion, and culture"--

Indonesia --- History