Emil Salim: “How to get out from middle income trap in 2043?”

“In between 2020-2045, most of the citizens of Indonesia will be in age between 15-65 years old and those age are very productive age. The question is ‘Will Indonesia’s people have the productivity and capability to maximize its potential and get out from middle income trap in 2043?’, “asked Professor Emil Salim during his guest lecturing for Energy Management MBA class in Jakarta (21/9/2019).

The former Minister of State for Population and the Environment stated there were at least five big issues faced today. “To improve the quality of HR demographic bonus for 2020-2040, to focus on how to get out of middle income trap in 2043, to develop Eastern Indonesia, to respond the environmental challenges of climate change, sea level rise and others, which have a major impact on the 147 million inhabitants of Java, and to build Indonesia as a Maritime Center to bridge the Indian Ocean and Pacific Ocean, “as he told the class.

How to make sure Indonesia get out from the trap? Emil Salim said, “Create world-class human capital. Importing capital from job creators, not spectators. Also, Indonesia should seriously manage natural assets and become world leader of geothermal energy and other renewable energy.”

He continued to explain that creating world class human capital could be done through improving the quality of basic education, partnering with private sectors to teach new skills for workers, and investing better in health sector. Low export revenues, weak Foreign Direct Investment (FDI) flows and a small financial sector, he added, had led to an over-reliance on ‘hot money’ from investors, which contributed to high interest rates and currency vulnerability. “This must be stopped. One of the ways is by importing capital from job creators, not spectators,” urged him.

“Never sell your soul which means that intellectual must have courage to say right or wrong therefore this country will never make wrong decision for future,” the 89-year-old Indonesian economist closed the session.

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