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Indonesia'S Resources Boom In International Perspective: Policy Dilemmas And Options For Continued Strong Growth

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  • Ross Garnaut

Abstract

In the decade to 2011, developments in the Chinese economy gave the world its biggest ever resources boom and set the scene for a resources deflation. The boom generated high incomes and investment in global resources, especially coal. It boosted Indonesian growth and diverted the policy focus from the productivity-raising reforms that are necessary for broad-based growth. Arbitrary interventions reduced the gains from the boom, especially in commodities other than coal, but also diminished the size of the boom and therefore the economic adjustment challenge that faces Indonesia now. Indonesia handled the Dutch disease and related challenges better than some countries and worse than others. Australia and Indonesia are now the world's largest coal exporters, so this comparison receives attention here. The end of the boom can create opportunities for a return to broad-based development, so long as policy settings are favourable to productivity growth and improved economy-wide competitiveness. The fuel-subsidy reforms are a good start.

Suggested Citation

  • Ross Garnaut, 2015. "Indonesia'S Resources Boom In International Perspective: Policy Dilemmas And Options For Continued Strong Growth," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 51(2), pages 189-212, August.
    • Handle: RePEc:taf:bindes:v:51:y:2015:i:2:p:189-212
    DOI: 10.1080/00074918.2015.1061910
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    References listed on IDEAS

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    1. Armida Alisjahbana, 2009. "Revisiting Indonesia’s Sources of Economic Growth and Its Projection Towards 2030," Working Papers in Economics and Development Studies (WoPEDS) 200905, Department of Economics, Padjadjaran University, revised Jul 2009.
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    Cited by:

    1. Shrestha, Rashesh & Coxhead, Ian, 2018. "Export boom, employment bust? The paradox of Indonesia's displaced workers, 2000-14," CEI Working Paper Series 2018-6, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    2. Kim, Kyunghoon & Sumner, Andy, 2021. "Bringing state-owned entities back into the industrial policy debate: The case of Indonesia," Structural Change and Economic Dynamics, Elsevier, vol. 59(C), pages 496-509.
    3. Edwards, Ryan B., 2016. "Mining away the Preston curve," World Development, Elsevier, vol. 78(C), pages 22-36.
    4. Rashesh Shrestha & Ian Coxhead, 2018. "Can Indonesia Secure a Development Dividend from Its Resource Export Boom?," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 54(1), pages 1-24, January.
    5. Qurrota Ayu NINDIEN & Arivina Ratih Yulihar TAHER & Asih MURWIATI & I Wayan SUPARTA & Neli AIDA, 2024. "Direct And Indirect Effect Of Globalization On Economic Growth In Indonesia," Scientific Bulletin - Economic Sciences, University of Pitesti, vol. 23(1), pages 33-44.
    6. Hal Hill, 2018. "Southeast Asia in the global economy: a selective analytical survey," Departmental Working Papers 2018-12, The Australian National University, Arndt-Corden Department of Economics.
    7. Hal Hill & Donny Pasaribu, 2022. "Some reflections on Indonesia and the resource curse," Departmental Working Papers 2022-06, The Australian National University, Arndt-Corden Department of Economics.
    8. Anuar Sanusi & Faurani Santi Singagerda & Ahmad Zaharuddin Sani, 2021. "World Oil Price Shocks in Macroeconomic ASEAN +3 Countries: Measurement of Risk Management and Decision-making a Linear Dynamic Panel Approach," International Journal of Energy Economics and Policy, Econjournals, vol. 11(4), pages 75-83.
    9. Hal Hill, 2018. "Asia's Third Giant: A Survey of the Indonesian Economy," The Economic Record, The Economic Society of Australia, vol. 94(307), pages 469-499, December.
    10. Maulidia, Martha & Dargusch, Paul & Ashworth, Peta & Ardiansyah, Fitrian, 2019. "Rethinking renewable energy targets and electricity sector reform in Indonesia: A private sector perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 101(C), pages 231-247.

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