Industrializations in Indonesia

Based on industrialization concept, industrialization not only to building industry but

industrialization concept is social economic change, where the people was transformed from the

stage of pre-industry where the per capita income is lowly accumulated, to industrialization

stage. So, the industrialization is not only economic transformation but also social

transformation. Industrialization growth of one country is defined by how much industry can

contribute to development country.

According to Indonesia economics, industrial sector contributes to GDP significantly and

shows improvement in the last 27 years. It explains that there is change in economic structure,

which is the increasing industrial sector and decreasing agricultural sector contribution. From

that aspect only we can conclude that Indonesia is industrialized. But this data not enough, we

should have to see other sector especially in agricultural sector, agricultural sector also given

contribute to GDP Indonesia.

Industrialization in Indonesia starts from the first to fifth Five Year Development

Planning (Repelita I-V). Indonesian economy is planned and built through industrialization.

Until 1990s, the industrialization is recognized by the world. Industrialization in Indonesia is

designed by setting the ideology that the government is the driver of community groups and

traditional cooperativeness (gotong royong) , but according to researcher from Berkeley

University, traditional cooperativeness in Indonesia cannot drive industrialization growth, but

individualism more dominant to drive industrialization than traditional cooperativeness.

Successful industrialization also requires significant increase of agricultural productivity,

but its not happen in Indonesia. Its A big mistake of Indonesian industrialization is that we
leave the agricultural sector behind so the agricultural productivity is low. Conceptually it is said

that industrial development is supported by agricultural development. Although we have once

rice self-sufficient, but the policy to self- suffices the rice has excess to sacrifice many things.

Agricultural sector grows unfirmly and agricultural production is not enough to supply the food

necessities.

This process makes industrialization in Indonesia has deteriorated, and becomes to de-

industrializations. Indicator, the percentage of the utility industry continues to decline from year

to year, if in the year of 1996 was 82.10 per cent, then in 2002 had reached 63.33 percent, since

2005, the manufacturing added-value to GDP are declining, Non oil and gas export composition

in 2003-2007 also shows setback in industrial sector. Processing industry export-oriented result

is smaller.

To overcome this de-industrialization, currently in Indonesia began to apply a dual

system of industrialization scheme. The reliability of industrialization dual scheme is the ability

to combine two aspects involved in the industrial growth in Indonesia, the one hand, priority is

given to main priority to industries that absorbing unemployment, the industry that makes

employment opportunities, with university technology-laden, that export-oriented.but in the

other hand attention also given to big industry, that focused on steps toward synergy.