Employment and Re-Industrialisation in Post Soeharto Indonesia
REGIONAL ECONOMIC STUDIES PROGRAMME SEMINAR
About the Lecture
This seminar is based on the author’s recent book, with Mohammad Zulfan Tadjoeddin, which studies the challenges for Indonesia, once a miracle economy, as it faces premature deindustrialisation, rising inequality, and domestic and external impediments impacting its export-oriented industrialisation. Since the fall of Soeharto, Indonesia has undergone a far-reaching systemic transition from centralised and autocratic governance to a highly decentralised and democratic system. Complicated by regional variations, the country is now being called upon to respect labour rights and, amidst slow global economic recovery, is facing increased competition from other low-labour-cost countries, especially within the ASEAN Economic Community. Indonesia cannot recreate its past miracle based on cheap labour and suppression of labour rights. It will need to move quickly, to generate high value-added activities driven by productivity growth, and to develop its domestic market.
Four key policy messages emerge. First, the policy framework to achieve “decent life for humanity”, as mandated by the 1945 Constitution, should emphasise improving employment quality instead of quantity. Second, minimum wage policies can play a useful role in addressing the rising inequality trend by reversing the widening gap between productivity and wages, found across the major economic sectors and provinces during the post-Soeharto period. Third, the dynamic and modern manufacturing sector, represented by the large and medium establishments, has the best potential for enhancing formal employment and re-aligning productivity and wages. Fourth, the diversity of Indonesia’s regions in terms of stages of socio-economic development and resource endowments is an asset as they should complement each other in creating internal dynamism to expand domestic market and flexibility to compete internationally, especially within the ASEAN economic community (AEC).
About the Speaker
Anis (Anisuzzaman) Chowdhury holds concurrent Adjunct Professorial positions at the Western Sydney University and the University of New South Wales (Australia). Anis retired from the United Nations Secretariat in January 2016 after completing an eight-year career in the Department of Economic and Social Affairs (UN-DESA) in New York and the United Nations Economic and Social Commission for Asia and the Pacific (UN-ESCAP) in Bangkok. Previously, he was Professor of Economics at the University of Western Sydney and taught also at the National University of Singapore, University of New England (Australia) and University of Manitoba (Canada). Anis was a visiting fellow at the ISEAS-Yusof Ishak Institute in 2001 and served on the editorial board of the ASEAN Economic Bulletin. He was a founding managing editor of the Journal of the Asia Pacific Economy (1995-2008), where he remains a co-editor. He is also on the editorial board of the Economic and Labour Relations Review (Sage).