The Relative importance of agricultural and manufacturing exports for economic development in Indonesia

WIJAYANTO, Dwi Nur, Prof. Yonosuke Hara, Ph.D

2008 | Tesis | S2 MPKD

This thesis observes the relative importance between agricultural and manufacturing exports for economic development in Indonesia through comparing the performance of each commodity by focusing on some numerical measures. Results show that Indonesian export structure has experienced evolution from agricultural to manufacturing sector with a clear pattern of upgrading from primary commodities to more advanced good which require higher level of skill and technology. Despite the trend of the growth rate and the share declined, agricultural export still plays important role to gain foreign exchange earnings and has some un-developed potential to encourage economic growth because most of agricultural export based on domestic inputs. Meanwhile, even though the growth rate and the share of manufacturing export increased and can get more foreign exchange earnings, it might present some structural problems rather than merely showing an evolution of the export structure because most of the manufacturing export needs the huge imported goods as inputs source. It can be identified through the increase of imported raw material continuously compared with other imported goods. Regarding with this problem, this thesis proposes some policies recommendation. First, Indonesian government should reform and revitalize various policies pertinent to export, so that the competitiveness of both agricultural and manufacturing commodities in international market increases. Second,Indonesian government should keep rupiah exchange rate at reasonable level for sustaining the export performance. Third, Indonesian government should develop some industries which is based on domestic inputs or agricultural commodities and can absorb mass labor to stimulate more domestic economy.

Kata Kunci : Relative,Pertanian export manufaktur,ekonomi pengembangan