President orders breakthrough to accelerate industry 4.0 roadmap

President Joko Widodo at a limited Cabinet meeting, in September 2019, ordered a breakthrough to encourage the acceleration of the industry 4.0 roadmap, known as Making Indonesia 4.0. "The steps of change should be realized in five priority sectors, namely food and beverages, automotive, textile, electronics, and chemicals," the President said. Several breakthroughs are necessary, such as improving regulations, improving the quality of human resources, building a good ecosystem of innovation, increasing incentives for investment in technology, and redesigning industrial zones to improve the flow of material.

"During this limited meeting, I want to hear the implementation report on the industry 4.0 roadmap. Our steps to face rapid, particularly the fourth industrial revolution, also known as Industry 4.0 should be measurable and clear. We should dare to make various leaps and breakthroughs," President Widodo said at the President's Office in Jakarta, Tuesday.

Source: ANTARA News Office. September 2019

The limited meeting was attended by Minister of Research and Higher Education M Natsir, Minister of Education and Culture Muhadjir Effendy, Minister of State-Owned Enterprises Rini Soemarno, Minister of Communication and Informatics Rudiantara, Minister of Home Affairs Tjahjo Kumolo, Coordinating Minister for Maritime Affairs Luhut Binsar Panjaitan, Coordinating Minister for Economic Affairs Darmin Nasution, Finance Minister Sri Mulyani Indrawati, Industry Minister Airlangga Hartarto, Trade Minister Enggartiasto Lukito, and Head of the Investment Coordinating Board (BPKM) Thomas Lembong.

"I want to remind you again that the industry 4.0 roadmap was launched in April 2018," the President remarked.

Several breakthroughs are necessary, such as improving regulations, improving the quality of human resources, building a good ecosystem of innovation, increasing incentives for investment in technology, and redesigning industrial zones to improve the flow of material.

"The steps of change should be realized in five priority sectors, namely food and beverages, automotive, textile, electronics, and chemicals," the President said.

If the government concentrates on improving the structure of the national industry, it can be even stronger.

"Then we can increase gross domestic product (GDP) significantly, especially exports and investment," he said.

The implementation of the industry roadmap is expected to create more than 10 million jobs.

The launch of Making Indonesia 4.0 as a roadmap for integrating strategies to enter the industrial 4.0 era was held at the Indonesia Industrial Summit 2018 on April 4, 2018.

Making Indonesia 4.0 provides a clear direction for the movement of the national industry with a focus on developing five manufacturing sectors that will be piloted and undertake 10 national initiatives to strengthen Indonesia's industrial structure.

The successful implementation of Making Indonesia 4.0 can then drive the growth of real GDP by one to two percent per year so that per year it will rise from the "baseline" from five to between six and seven percent between 2018 and 2030. The manufacturing industry’s share from this achievement should be between 21 and 26 percent of the GDP in 2030.

In addition to increasing productivity, Making Indonesia 4.0 promises to create 7 to 19 million jobs, both in the manufacturing and non-manufacturing sectors by 2030 as a result of greater export demand.

The five main technologies that support the implementation of Industry 4.0, are the Internet of Things, Artificial Intelligence, Human-Machine Interface, robotics and sensor technology, and 3D Printing technology.

For the initial implementation of Industry 4.0, Indonesia will need to focus on five manufacturing sectors, such as the food and beverage industry, the textile and clothing industry, the automotive industry, the chemical industry, and the electronics industry.

Besides, Making Indonesia 4.0 includes 10 cross- sectoral national initiatives to accelerate the development of the domestic manufacturing industry. These are improving the flow of goods and materials, building a comprehensive and cross-industrial zone road map, accommodating sustainability standards, empowering small and medium industries, and building national digital infrastructure.

Thereafter, one must attract foreign investment, improve the quality of human resources, develop the innovation ecosystems, incentivize technological investment, and harmonize rules and policies.