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IMPOSSIBLE IS IMPOSSIBLE IS POSSIBLE:POSSIBLE:

R. HARTARTO SASTROSOENARTO R. HARTARTO SASTROSOENARTO AND INDUSTRIALIZATION IN AND INDUSTRIALIZATION IN

INDONESIA *)INDONESIA *)

Dr. Yuda B. TangkilisanDr. Yuda B. TangkilisanFaculty of HumanitiesFaculty of Humanities

University of IndonesiaUniversity of Indonesia----------------------------------------------------------------------------*) *) Delivered at Delivered at The International The International

Graduate Student Conference Graduate Student Conference on Indonesiaon Indonesia (IGSC), Yogyakarta December (IGSC), Yogyakarta December

20092009

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BACKGROUNDSBACKGROUNDS Prior to 1970, Indonesia was characterized as a Prior to 1970, Indonesia was characterized as a

“chronic economic dropout” and as a one of the “chronic economic dropout” and as a one of the poorest countries in the world (Higgins 1968: poorest countries in the world (Higgins 1968: 678)678)

No one would believe that Indonesia would be No one would believe that Indonesia would be grouped as a member of the most exclusive club grouped as a member of the most exclusive club of “East Asian Miracle Economies” and with the of “East Asian Miracle Economies” and with the highest economic group in the world in just 20 highest economic group in the world in just 20 years (Wulan Sari 2004: 3)years (Wulan Sari 2004: 3)

Few chances for Indonesia to have a rapid Few chances for Indonesia to have a rapid economic growth (Myrdal 1969)economic growth (Myrdal 1969)

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BACKGROUNDS (2)BACKGROUNDS (2) Industrialization and economic growthIndustrialization and economic growth

New Industrial Country (NIC) in the 1980s as New Industrial Country (NIC) in the 1980s as Asia’s ‘dragon’ economiesAsia’s ‘dragon’ economies

Industrial sectors (Industrial sectors (non migas) non migas) contribution contribution to GDP (Gross Domestic Products) to GDP (Gross Domestic Products) outnumbered Agricultural sectorsoutnumbered Agricultural sectors SectorsSectors 19831983 19931993 ---------------------------------------------------------------------------------------------------- AgricultureAgriculture 24.3 %24.3 % 11.4 %11.4 % IndustryIndustry 17.8 %17.8 % 22.3 %22.3 %

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IMPOSSIBLEIMPOSSIBLE IS POSSIBLEIS POSSIBLE

• A BELIEF OF R. HARTARTO A BELIEF OF R. HARTARTO SASTROSOENARTO SASTROSOENARTO

• THOUGHTSTHOUGHTS• STRATEGYSTRATEGY• SELF ESTEEMEDSELF ESTEEMED• OPTIMISMOPTIMISM• TEAM WORKTEAM WORK

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PURPOSESPURPOSES To show industrial progress To show industrial progress

during 1983—1993during 1983—1993 Sumitro Djojohadikusumo Sumitro Djojohadikusumo

(1991) was impressed by the (1991) was impressed by the progressprogress

Anne Booth (2001) has similar Anne Booth (2001) has similar impressionsimpressions

To explain how the progress To explain how the progress was achievedwas achieved

To explore the good side To explore the good side (legacy) of New Order from (legacy) of New Order from economic development angle as economic development angle as lessons for todaylessons for today

Cultivating the role and Cultivating the role and contribution of R. Hartarto contribution of R. Hartarto Sastrosoenarto in indonesian Sastrosoenarto in indonesian industrial development industrial development

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METHODOLOGYMETHODOLOGY Gathering dataGathering data

• Documentary & Documentary & Literature StudyLiterature Study

• Oral history (Interview)Oral history (Interview) Key personsKey persons Other informantsOther informants

Structurism/ Structurism/ Structuration (Lloyd/ Structuration (Lloyd/ Giddens)Giddens)• Structure and ChangesStructure and Changes• AgencyAgency• Reproduction (Failed)Reproduction (Failed)• Transformation (When Transformation (When

Succeeded)Succeeded)

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Biographical BackgroundsBiographical Backgrounds 1983 to 1993 was the terms of Hartarto 1983 to 1993 was the terms of Hartarto

Sastrosunarto as Minister of IndustrySastrosunarto as Minister of Industry Chemical engineers graduated from AustraliaChemical engineers graduated from Australia Began his career from the bottom at Department Began his career from the bottom at Department

of Industryof Industry Visions for Indonesia in the future as a world Visions for Indonesia in the future as a world

playerplayer Still concerns with industrialization of IndonesiaStill concerns with industrialization of Indonesia

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Thoughts and PerformanceThoughts and Performance Industrialization needs a Industrialization needs a

legal groundlegal ground Acts of Industry no. 5, 1984Acts of Industry no. 5, 1984

Priority of Industries Priority of Industries (middle technology)(middle technology) A links to agrarian sectors A links to agrarian sectors

(fertilizers)(fertilizers) Constructions (cements)Constructions (cements) Social needs (pulps)Social needs (pulps) Production (machines)Production (machines)

6 Main Policies6 Main Policies 4 Supporting policies4 Supporting policies

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6 Main Policies:1) Developing industrial structure, 2) Developing machinery and electronics industries, 3) Developing small industries, 4) To export industrial wares, 5) Developing research and technology, 6) To develop entrepreneurship and professionalism.

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4 Supporting Policies4 Supporting Policies 1) legal basics, 1) legal basics, 2) clustering 2) clustering

national national industries, industries,

3) inter-linkage 3) inter-linkage programs and programs and

4) widening 4) widening domestic and domestic and international international markets markets

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Ability & LeadershipAbility & Leadership Expert in matters by Expert in matters by

training and training and experiencesexperiences

Firm personality—not Firm personality—not hesitate to take a hesitate to take a decisiondecision

To organize the To organize the departmentdepartment

Making a new branchesMaking a new branches Merit system (right men Merit system (right men

in the right place)in the right place) Corporate CultureCorporate Culture

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RESULTSRESULTS Hartarto played an Hartarto played an

important role in important role in industrialization during the industrialization during the New OrderNew Order

Industrialization endured Industrialization endured along the law and policiesalong the law and policies

Industrial sectors Industrial sectors (manufacturing) grew (manufacturing) grew outnumbering agrarian outnumbering agrarian sectors to GDPsectors to GDP

From the UNIDO (United From the UNIDO (United Nation Industrial Nation Industrial Development Organization) Development Organization) criteria, Indonesia has criteria, Indonesia has entered a phase of New entered a phase of New Industrial Countries (NIC) Industrial Countries (NIC)

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CONCLUDARY REMARKSCONCLUDARY REMARKS Industrialization is not Industrialization is not

only building factories only building factories but also more important but also more important industrial societyindustrial society

Industrialization implied Industrialization implied a team work, not one a team work, not one man showman show

Government has Government has important roles in important roles in industrialization as a industrialization as a regulator and prime regulator and prime mover but not as a main mover but not as a main playerplayer

Impossible is Possible Impossible is Possible

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THANK YOUTHANK YOU