Indonesia as a developed country and Indonesia’s vision 2045
Is Indonesia a developed country? The answer to this question is fascinating. Because according to the United States, as of February 2020, along with 127 other countries, Indonesia is no longer a developing country. There is a lot of political spice behind Uncle Sam’s statement. Of course, this is different from the statements of The International Monetary Fund (IMF) and the World Trade Organization (WTO). According to the IMF, Indonesia is a developing country with a per capita income of $3,869 in 2020. At least a per capita income of $13,000 per year is required to exceed one criterion to become a developed country. This does not mean that Indonesia does not have potential because, according to oxford economics, Indonesia is included in the category of 10 emerging market countries or markets that are developing rapidly for the global economy in 2028. Emerging market countries also have low to medium-level economies in per capita income. The country is 80% of the global population and represents about 20% of the world economy.
Aware of the enormous potential, the Indonesian government has moved quickly and launched the Vision Indonesia 2045 program. The government formed this vision to provide an overview of Indonesia’s shape in 2045 and a road map that is capable and needs to be achieved in 2045. The achievement of Indonesia’s Vision is built by 4 pillars of development: Human Development and Mastery of Science and Technology, Sustainable Economic Development, Equitable Development, and Consolidating National Resilience and Governance. Each pillar contains areas of development, from education to foreign policy, which must be developed and accelerated until 2045 to realize Indonesia’s Vision 2045.
What’s so special about 2045? Of course, it’s not just the 100th anniversary of Indonesia’s independence. However, data shows that Indonesia will experience a demographic dividend in 2030–2040. The demographic dividend itself has a meaning which means a phenomenon when the population of productive age (15–64 years) has a higher number than the population of non-productive age. Based on the demographic dividend, the Organization for Economic Co-operation and Development (OECD) estimates that Indonesia will become the 4th largest economy in the world with a wealth of up to US$ 8.89 trillion. Not only that, also the Indonesian Minister of Finance Sri Mulyani also predicts that by 2045 Indonesia’s per capita income will be able to touch US$ 29,300 per year.
What happened that this demographic dividend could have so much impact on Indonesia’s growth? The main advantage is the economic benefit caused by the decline in the fertility ratio of the population as a result of extended growth. The number of people with productive age controls >70% of a country’s population. All nations will essentially experience a demographic dividend condition at least once in their history.
One of the advantages of this demographic dividend is the availability of abundant and competent human resources. Increasing the quantity at the same time will also improve the quality of the workforce. Easy access to labour will also indirectly reduce the cost of producing services or goods. Of course, this is very interesting to invite more investment into the country. And of course, these investments can spur economic growth very significantly. Coupled with a large population, the demand for goods and services will also increase, which will trigger economies of scale and the circulation of money will continue to grow.
Like a double-edged sword, of course this demographic dividend comes with some challenges. The increasing number of human resources also requires sufficient and qualified employment. Increasing these levels will be a scourge in itself with competition in the world of work. In addition, the aging population is another challenge that must be faced. If not accompanied by a reasonable birth rate, this productive generation will age together in a comparable period. This event, of course will reduce the level of productivity of the country and become a problem in itself.
So what should be prepared? The government must focus on education in welcoming Indonesia’s 2045 vision. Increasing the quantity of the productive age population must also be simultaneously improved in quality to significantly impact the country’s development. Of course improving the quality of education will be very difficult without an increase in supporting infrastructure. Remember that this infrastructure improvement should not only be centered in big cities. However, it must be done equitably to ensure that quality education can be well distributed to the entire community without being hindered by geographical barriers. Next Health should be something more attention. Not only health infrastructure but also health information and education. Of course, life expectancy is something that must continue to be monitored to achieve the demographic dividend. And also, the birth rate should be a focus before, during, and after the demographic dividend period. Before ensuring we can reach the demographic dividend period. During the demographic dividend period, we can prevent the aging population from occurring, and after that, population growth can be maintained.
Indonesia’s 2045 vision is undoubtedly a form of growth, optimism, and hope drawn up by the nation’s youth generation. Indonesia is not in a position of lack potential to become one of the world’s economic centres. Of course, achieving it is not easy and requires struggle. As the younger generation, it is our duty to realize Indonesia’s 2045 Vision. Then, the last question that will arise is, Are we ready to realize Indonesia’s 2045 vision and welcome the demographic dividend period brilliantly?