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Presented by Budi Rahardjo PPAU MIKROELEKTRONIKA ITB Presented @ BITE 2000

Presented by Budi Rahardjo PPAU MIKROELEKTRONIKA ITB Presented @ BITE 2000. BACKGROUND. Indonesia’s economy is not in a good shape We must find ways to strengthen Indonesia’s economy New economy provides opportunity we cannot miss Opportunities in the Global New Economy

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Presented by Budi Rahardjo PPAU MIKROELEKTRONIKA ITB Presented @ BITE 2000

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  1. Presented by Budi RahardjoPPAU MIKROELEKTRONIKA ITBPresented @ BITE 2000

  2. BACKGROUND • Indonesia’s economy is not in a good shape • We must find ways to strengthen Indonesia’s economy • New economy provides opportunity we cannot miss • Opportunities in the Global New Economy • Various statistics have shown growth in Information Technology (IT) and Electronics • Indonesia is not far behind in this field

  3. ECONOMICAL BACKGROUND • Export is a viable means to support Indonesia’s economy • Indonesian export: • Oil & Gas (2020 & 2040 will be gone) • Wood (destroying our jungle) • Textile (competition from China) • Electronics (including IT)

  4. ELECTRONICS • Defintion of “Electronics” according to DEPRINDAG includes • Information Technology • Modules and components • Semiconductor • Consumer Electronics • Telecommunications • Home Appliances • Misc.

  5. INDONESIA ELECTRONICS EXPORT target US$ 30 billion In billion US$source: Dept of Commerce, Indonesia 30 Target24% p.a. 13 6 3.9 1996 1997 1988 1999 2000 2003 2006 2010 Rescue Recovery Growth

  6. DEPRINDAG • 1996 • Electronic Super Sites (ESS) • Super Highway / 3 Jalur Kemudahan (Koridor Cilegon-Jakarta-Cikampek-Purwakarta-Padalarang-Bandung) • Incentive, Taxtion, Training • Domestic market – distribution • Bandung High Tech Valley (BHTV) • Technology Transfer Agency • Software dan Engineering Support Development • 1997 Crisis!

  7. Source: DEPARTEMEN PERINDUSTRIAN DAN PERDAGANGAN Central Government Pamanukan Jakarta Cilegon Koridor JKT-CLG Koridor JKT-CKP Cikande Cikampek Serpong Rangkasbitung Bogor Purwakarta Rencana Koridor CIPULARANG Electricity &Hydro Padalarang BHTV R&D Centers Bandung

  8. WHY BANDUNG • Bandung’s “goldmine” • Science & TechnologyTop universities, research centers, tech-related corporations (crown corp./BUMN & private) • Talented and intelligent human resourcesTop students study in Bandung. Universities in Bandung are attended by top Indonesian students • Nice place to work and live (ecosystem)

  9. Bandung SciTech community source: Direktorat Industri Elektronika, Dirjen ILMEA, Deprindag PINDAD POS PJKA Universities: UNPAD ParahiyanganIKIP, UNISBA Etc. TELKOM ITB SoftwareHardwareHouses BHTV ResearchCenters: PPAURISTILIPI MIDC B4T Etc. Technology Infrastructure LEN INTI CMI TELNIC IPTN: aircraft industry

  10. ECONOMIC VALUE • High tech creates economic value • If there are 500,000 hi-tech workers in Bandung and their salary is Rp1,000,000/month (paid by private companies, not by government), calculate the amount of money flowing • Money will be spent in Bandung’s area • Generate new economy • Note: • High-tech worker’s salary is more than Rp 1,000,000 • Companies provide work

  11. LESSONS FROM OTHER COUNTRIES • Silicon Valley, USA (July 2000) • The definite model • 50 mil long • 3.2 million people • More than 7000 IT companies • 11 companies started every week • 1 company goes public every 5 days • 20% of top IT companies in the world • Market capitalization: US$ 450 billions • 62 new millionaires/day

  12. LESSONS FROM OTHER COUNTRIES • India • The success of India in software industry proves that everybody can participate in the new economy • In less than (5) years, India’s software export multiplied and became US$ 4 billion in 2000. Estimated US$50 billion in year 2008 • NOT DOMESTIC MARKET! • Political situation in India is not stable (Kashmir, change in government, etc.), yet business progresses • English (language) is not a barrier • Government commitment

  13. LESSONS FROM OTHER COUNTRIES • China • Progressing very rapidly! • Techno parks are being created everywhere (near Beijing) • Internet users grow exponentially • Yet not a rich country • Piracy is high, but Microsoft (and other high tech industries) open research centers in China! • English is still a barrier • Government commitment

  14. LESSONS FROM OTHER COUNTRIES • Malaysia • Multimedia Super Coridor (MSC), Cyberjaya, Putrajaya • Provides incentives for high tech companies! • Still struggling (but moving forward) • Government commitment, Top down approach

  15. CHALLENGES • Human Resources Crisis!The demand is greater than the supply • India can generate 70,000 IT new professional/year. How about Indonesia? • Various initiatives have been started in Indonesia • “Sekolah 2000” [school 2000 program] • SMK-TI [Sekolah Menengah Kejuruan bidang Teknologi Informasi] • IT training centers, certification, non-degree & competency learning centers • private initiatives (Bali Camp, Cybercity)

  16. CHALLENGES • Indonesian Human Resources Quality • Lack/poor of English capability • Not known as high-tech workers • Not efficient (slow workers) • Low on working ethics

  17. CHALLENGES • Government policy • Unclear • Too many hidden agendas from many groups • Lack of incentives to private sectors • Infrastructure • Poor to lack telecommunication infrastructure (difficult to get telephone lines) • Monopoly & duopoly problems • Small PC penetration (400,000 market share) • But big in wireless (4 million cellphones)

  18. CHALLENGES • Bandung’s problem • No international airport • Telecommunication infrastructure problem (problem between PT Telkom and Aria West) • Poor (lack of) city development • Lack of luxury homes (eg with swimming pool)

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