Indonesia : Avoiding the Trap

Within the next two decades Indonesia aspires to generate prosperity, avoid a middle-income trap and leave no one behind as it tries to catch up with high-income economies. These are ambitious goals. Realizing them requires sustained high growth an...

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Main Author:	World Bank
Format:	Development Policy Review (DPR)
Language:	English en_US
Published:	Jakarta 2014
Subjects:	ACCOUNTABILITY ACCOUNTING ACTUAL COSTS AGRICULTURE AMORTIZATIONS ASSET QUALITY ASSETS AUTONOMY AVERAGE PRODUCTIVITY BALANCE SHEETS BANK CREDIT BANK FINANCING BANK RECAPITALIZATION BANKS BASIC EDUCATION BOND YIELDS BONDS BROKER BROKERAGE BUDGETING CAPITAL ACCOUNT CAPITAL FORMATION CAPITAL MARKET CAPITAL MARKETS CAPITAL STOCK CASH FLOW CASH FLOWS CENTRAL BANK CENTRAL BANK INDEPENDENCE COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPETITIVENESS CONSUMER DURABLES CORPORATE BOND CORPORATE BOND MARKET CORPORATE BONDS CORPORATE GOVERNANCE COST OF LIVING CREDIT CONSTRAINT CREDITORS CURRENCY CURRENCY APPRECIATION CURRENT ACCOUNT DEFICIT DEBT DEBT LEVEL DEBT SERVICE DEBT STOCK DECENTRALIZATION DEFICIT SPENDING DEPOSIT DEVALUATION DEVELOPMENT POLICY DOMESTIC BOND DOMESTIC DEBT DOMESTIC DEBT SECURITIES DRIVERS ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC SECTORS ELECTRICITY EMERGING ECONOMIES ENFORCEMENT MECHANISMS ENFORCEMENT OF CONTRACTS EQUIPMENT ESCROW EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTS EXTERNAL DEBT EXTREME POVERTY FINANCIAL CRISIS FINANCIAL INTEGRATION FINANCIAL MARKET FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SERVICES FINANCING REQUIREMENT FISCAL BALANCE FISCAL DEFICIT FISCAL DEFICITS FISCAL POLICY FISCAL REFORMS FLOATING RATE FOREIGN INVESTORS GDP GDP PER CAPITA GLOBAL ECONOMY GLOBALIZATION GOVERNMENT BUDGET GOVERNMENT DEBT GOVERNMENT DEFICIT GOVERNMENT EXPENDITURE GOVERNMENT FINANCING GOVERNMENT REVENUES GOVERNMENT SPENDING GRANT ALLOCATION GROWTH POTENTIAL GROWTH RATE GROWTH THEORY HEALTH SPENDING HOUSEHOLD INCOMES HOUSING HUMAN CAPITAL HUMAN RESOURCES INCOME INCOME INEQUALITY INCOME LEVEL INFLATION INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE INVESTMENT INSTITUTIONAL DEVELOPMENT INSURANCE INTEREST PAYMENTS INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERGOVERNMENTAL FINANCE INVENTORY INVESTMENT DECISIONS INVESTMENT FUNDS INVESTMENT REQUIREMENTS INVESTOR PROTECTION ISSUANCE JOB CREATION LABOR COSTS LABOR FORCE LABOR MARKET LABOR MARKET ISSUES LABOR MARKET RIGIDITIES LABOR PRODUCTIVITY LABOR UNIONS LAND REFORMS LANDOWNERS LAWS LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LEGISLATION LICENSES LIQUIDITY LIVING STANDARDS LOCAL CURRENCY LOCAL GOVERNMENTS LOCAL INFRASTRUCTURE MACROECONOMIC STABILITY MANDATES MATURITY MATURITY MISMATCHES MATURITY SPECTRUM METROPOLITAN AREAS MULTIPLIER EFFECTS MUNICIPAL BONDS MUNICIPALITIES NATIONAL GOVERNMENTS NATURAL DISASTER NATURAL DISASTERS NOMINAL WAGES OIL PRICE PENSION PENSION FUND PENSION FUND ASSETS PHYSICAL ASSETS PHYSICAL SECURITY POLICY RESPONSE PRICE INCREASES PRICE RISKS PRIVATE BORROWING PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR PRIVATE SECTOR INVESTMENT PRIVATE SECTOR PARTICIPATION PRODUCT MARKETS PRODUCTIVITY PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROFITABILITY PROPERTY RIGHTS PUBLIC PUBLIC DEBT PUBLIC FINANCE PUBLIC INFRASTRUCTURE PUBLIC INVESTMENT PUBLIC INVESTMENT IN INFRASTRUCTURE PUBLIC POLICY PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICES PUBLIC SPENDING REAL GDP REAL INCOME REGULATORY BARRIERS REGULATORY FRAMEWORK REGULATORY STRUCTURES RETAINED EARNINGS RETURN REVENUE COLLECTION RISK AVERSION RISK MANAGEMENT RISK PROFILE ROADS SAFETY SAFETY NET SAFETY NETS SAVINGS SECURITIES SETTLEMENT SOCIAL SERVICES STOCK EXCHANGE STRUCTURAL CHANGE SUBNATIONAL GOVERNMENTS TAX TAX ADMINISTRATION TAX REFORM TAX REVENUES TOTAL FACTOR PRODUCTIVITY TOTAL OUTPUT TRADE BALANCE TRADE LAWS TRANSPARENCY TRANSPORT UNEMPLOYMENT URBAN DEVELOPMENT URBAN INFRASTRUCTURE URBANIZATION VALUATION WAGES WEALTH WEALTH EFFECTS
Online Access:	http://documents.worldbank.org/curated/en/2014/05/19705081/indonesia-avoiding-trap http://hdl.handle.net/10986/18944

id	okr-10986-18944
recordtype	oai_dc
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	ACCOUNTABILITY ACCOUNTING ACTUAL COSTS AGRICULTURE AMORTIZATIONS ASSET QUALITY ASSETS AUTONOMY AVERAGE PRODUCTIVITY BALANCE SHEETS BANK CREDIT BANK FINANCING BANK RECAPITALIZATION BANKS BASIC EDUCATION BOND YIELDS BONDS BROKER BROKERAGE BUDGETING CAPITAL ACCOUNT CAPITAL FORMATION CAPITAL MARKET CAPITAL MARKETS CAPITAL STOCK CASH FLOW CASH FLOWS CENTRAL BANK CENTRAL BANK INDEPENDENCE COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPETITIVENESS CONSUMER DURABLES CORPORATE BOND CORPORATE BOND MARKET CORPORATE BONDS CORPORATE GOVERNANCE COST OF LIVING CREDIT CONSTRAINT CREDITORS CURRENCY CURRENCY APPRECIATION CURRENT ACCOUNT DEFICIT DEBT DEBT LEVEL DEBT SERVICE DEBT STOCK DECENTRALIZATION DEFICIT SPENDING DEPOSIT DEVALUATION DEVELOPMENT POLICY DOMESTIC BOND DOMESTIC DEBT DOMESTIC DEBT SECURITIES DRIVERS ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC SECTORS ELECTRICITY EMERGING ECONOMIES ENFORCEMENT MECHANISMS ENFORCEMENT OF CONTRACTS EQUIPMENT ESCROW EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTS EXTERNAL DEBT EXTREME POVERTY FINANCIAL CRISIS FINANCIAL INTEGRATION FINANCIAL MARKET FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SERVICES FINANCING REQUIREMENT FISCAL BALANCE FISCAL DEFICIT FISCAL DEFICITS FISCAL POLICY FISCAL REFORMS FLOATING RATE FOREIGN INVESTORS GDP GDP PER CAPITA GLOBAL ECONOMY GLOBALIZATION GOVERNMENT BUDGET GOVERNMENT DEBT GOVERNMENT DEFICIT GOVERNMENT EXPENDITURE GOVERNMENT FINANCING GOVERNMENT REVENUES GOVERNMENT SPENDING GRANT ALLOCATION GROWTH POTENTIAL GROWTH RATE GROWTH THEORY HEALTH SPENDING HOUSEHOLD INCOMES HOUSING HUMAN CAPITAL HUMAN RESOURCES INCOME INCOME INEQUALITY INCOME LEVEL INFLATION INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE INVESTMENT INSTITUTIONAL DEVELOPMENT INSURANCE INTEREST PAYMENTS INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERGOVERNMENTAL FINANCE INVENTORY INVESTMENT DECISIONS INVESTMENT FUNDS INVESTMENT REQUIREMENTS INVESTOR PROTECTION ISSUANCE JOB CREATION LABOR COSTS LABOR FORCE LABOR MARKET LABOR MARKET ISSUES LABOR MARKET RIGIDITIES LABOR PRODUCTIVITY LABOR UNIONS LAND REFORMS LANDOWNERS LAWS LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LEGISLATION LICENSES LIQUIDITY LIVING STANDARDS LOCAL CURRENCY LOCAL GOVERNMENTS LOCAL INFRASTRUCTURE MACROECONOMIC STABILITY MANDATES MATURITY MATURITY MISMATCHES MATURITY SPECTRUM METROPOLITAN AREAS MULTIPLIER EFFECTS MUNICIPAL BONDS MUNICIPALITIES NATIONAL GOVERNMENTS NATURAL DISASTER NATURAL DISASTERS NOMINAL WAGES OIL PRICE PENSION PENSION FUND PENSION FUND ASSETS PHYSICAL ASSETS PHYSICAL SECURITY POLICY RESPONSE PRICE INCREASES PRICE RISKS PRIVATE BORROWING PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR PRIVATE SECTOR INVESTMENT PRIVATE SECTOR PARTICIPATION PRODUCT MARKETS PRODUCTIVITY PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROFITABILITY PROPERTY RIGHTS PUBLIC PUBLIC DEBT PUBLIC FINANCE PUBLIC INFRASTRUCTURE PUBLIC INVESTMENT PUBLIC INVESTMENT IN INFRASTRUCTURE PUBLIC POLICY PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICES PUBLIC SPENDING REAL GDP REAL INCOME REGULATORY BARRIERS REGULATORY FRAMEWORK REGULATORY STRUCTURES RETAINED EARNINGS RETURN REVENUE COLLECTION RISK AVERSION RISK MANAGEMENT RISK PROFILE ROADS SAFETY SAFETY NET SAFETY NETS SAVINGS SECURITIES SETTLEMENT SOCIAL SERVICES STOCK EXCHANGE STRUCTURAL CHANGE SUBNATIONAL GOVERNMENTS TAX TAX ADMINISTRATION TAX REFORM TAX REVENUES TOTAL FACTOR PRODUCTIVITY TOTAL OUTPUT TRADE BALANCE TRADE LAWS TRANSPARENCY TRANSPORT UNEMPLOYMENT URBAN DEVELOPMENT URBAN INFRASTRUCTURE URBANIZATION VALUATION WAGES WEALTH WEALTH EFFECTS
spellingShingle	ACCOUNTABILITY ACCOUNTING ACTUAL COSTS AGRICULTURE AMORTIZATIONS ASSET QUALITY ASSETS AUTONOMY AVERAGE PRODUCTIVITY BALANCE SHEETS BANK CREDIT BANK FINANCING BANK RECAPITALIZATION BANKS BASIC EDUCATION BOND YIELDS BONDS BROKER BROKERAGE BUDGETING CAPITAL ACCOUNT CAPITAL FORMATION CAPITAL MARKET CAPITAL MARKETS CAPITAL STOCK CASH FLOW CASH FLOWS CENTRAL BANK CENTRAL BANK INDEPENDENCE COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPETITIVENESS CONSUMER DURABLES CORPORATE BOND CORPORATE BOND MARKET CORPORATE BONDS CORPORATE GOVERNANCE COST OF LIVING CREDIT CONSTRAINT CREDITORS CURRENCY CURRENCY APPRECIATION CURRENT ACCOUNT DEFICIT DEBT DEBT LEVEL DEBT SERVICE DEBT STOCK DECENTRALIZATION DEFICIT SPENDING DEPOSIT DEVALUATION DEVELOPMENT POLICY DOMESTIC BOND DOMESTIC DEBT DOMESTIC DEBT SECURITIES DRIVERS ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC SECTORS ELECTRICITY EMERGING ECONOMIES ENFORCEMENT MECHANISMS ENFORCEMENT OF CONTRACTS EQUIPMENT ESCROW EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTS EXTERNAL DEBT EXTREME POVERTY FINANCIAL CRISIS FINANCIAL INTEGRATION FINANCIAL MARKET FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SERVICES FINANCING REQUIREMENT FISCAL BALANCE FISCAL DEFICIT FISCAL DEFICITS FISCAL POLICY FISCAL REFORMS FLOATING RATE FOREIGN INVESTORS GDP GDP PER CAPITA GLOBAL ECONOMY GLOBALIZATION GOVERNMENT BUDGET GOVERNMENT DEBT GOVERNMENT DEFICIT GOVERNMENT EXPENDITURE GOVERNMENT FINANCING GOVERNMENT REVENUES GOVERNMENT SPENDING GRANT ALLOCATION GROWTH POTENTIAL GROWTH RATE GROWTH THEORY HEALTH SPENDING HOUSEHOLD INCOMES HOUSING HUMAN CAPITAL HUMAN RESOURCES INCOME INCOME INEQUALITY INCOME LEVEL INFLATION INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE INVESTMENT INSTITUTIONAL DEVELOPMENT INSURANCE INTEREST PAYMENTS INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERGOVERNMENTAL FINANCE INVENTORY INVESTMENT DECISIONS INVESTMENT FUNDS INVESTMENT REQUIREMENTS INVESTOR PROTECTION ISSUANCE JOB CREATION LABOR COSTS LABOR FORCE LABOR MARKET LABOR MARKET ISSUES LABOR MARKET RIGIDITIES LABOR PRODUCTIVITY LABOR UNIONS LAND REFORMS LANDOWNERS LAWS LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LEGISLATION LICENSES LIQUIDITY LIVING STANDARDS LOCAL CURRENCY LOCAL GOVERNMENTS LOCAL INFRASTRUCTURE MACROECONOMIC STABILITY MANDATES MATURITY MATURITY MISMATCHES MATURITY SPECTRUM METROPOLITAN AREAS MULTIPLIER EFFECTS MUNICIPAL BONDS MUNICIPALITIES NATIONAL GOVERNMENTS NATURAL DISASTER NATURAL DISASTERS NOMINAL WAGES OIL PRICE PENSION PENSION FUND PENSION FUND ASSETS PHYSICAL ASSETS PHYSICAL SECURITY POLICY RESPONSE PRICE INCREASES PRICE RISKS PRIVATE BORROWING PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR PRIVATE SECTOR INVESTMENT PRIVATE SECTOR PARTICIPATION PRODUCT MARKETS PRODUCTIVITY PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROFITABILITY PROPERTY RIGHTS PUBLIC PUBLIC DEBT PUBLIC FINANCE PUBLIC INFRASTRUCTURE PUBLIC INVESTMENT PUBLIC INVESTMENT IN INFRASTRUCTURE PUBLIC POLICY PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICES PUBLIC SPENDING REAL GDP REAL INCOME REGULATORY BARRIERS REGULATORY FRAMEWORK REGULATORY STRUCTURES RETAINED EARNINGS RETURN REVENUE COLLECTION RISK AVERSION RISK MANAGEMENT RISK PROFILE ROADS SAFETY SAFETY NET SAFETY NETS SAVINGS SECURITIES SETTLEMENT SOCIAL SERVICES STOCK EXCHANGE STRUCTURAL CHANGE SUBNATIONAL GOVERNMENTS TAX TAX ADMINISTRATION TAX REFORM TAX REVENUES TOTAL FACTOR PRODUCTIVITY TOTAL OUTPUT TRADE BALANCE TRADE LAWS TRANSPARENCY TRANSPORT UNEMPLOYMENT URBAN DEVELOPMENT URBAN INFRASTRUCTURE URBANIZATION VALUATION WAGES WEALTH WEALTH EFFECTS World Bank Indonesia : Avoiding the Trap
geographic_facet	East Asia and Pacific Indonesia
description	Within the next two decades Indonesia aspires to generate prosperity, avoid a middle-income trap and leave no one behind as it tries to catch up with high-income economies. These are ambitious goals. Realizing them requires sustained high growth and job creation, as well as reduced inequality. Can Indonesia achieve them? This report argues that the country has the potential to rise and become more prosperous and equitable. But the risk of 'floating in the middle' is real. Which pathway the economy will take depends on: (i) the adoption of a growth strategy that unleashes the productivity potential of the economy; and (ii) consistent implementation of a few, long-standing, high-priority structural reforms to boost growth and share prosperity more widely. Indonesia is fortunate to have options in financing these reforms without threatening its long-term fiscal outlook. The difficulties lie in getting the reforms implemented in a complex institutional and decentralized framework. But Indonesia cannot afford hard to not try harder. The costs of complacency, and the rewards for action, are too high.
format	Economic & Sector Work :: Development Policy Review (DPR)
author	World Bank
author_facet	World Bank
author_sort	World Bank
title	Indonesia : Avoiding the Trap
title_short	Indonesia : Avoiding the Trap
title_full	Indonesia : Avoiding the Trap
title_fullStr	Indonesia : Avoiding the Trap
title_full_unstemmed	Indonesia : Avoiding the Trap
title_sort	indonesia : avoiding the trap
publisher	Jakarta
publishDate	2014
url	http://documents.worldbank.org/curated/en/2014/05/19705081/indonesia-avoiding-trap http://hdl.handle.net/10986/18944
_version_	1764443413586903040
spelling	okr-10986-189442021-04-23T14:03:51Z Indonesia : Avoiding the Trap World Bank ACCOUNTABILITY ACCOUNTING ACTUAL COSTS AGRICULTURE AMORTIZATIONS ASSET QUALITY ASSETS AUTONOMY AVERAGE PRODUCTIVITY BALANCE SHEETS BANK CREDIT BANK FINANCING BANK RECAPITALIZATION BANKS BASIC EDUCATION BOND YIELDS BONDS BROKER BROKERAGE BUDGETING CAPITAL ACCOUNT CAPITAL FORMATION CAPITAL MARKET CAPITAL MARKETS CAPITAL STOCK CASH FLOW CASH FLOWS CENTRAL BANK CENTRAL BANK INDEPENDENCE COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPETITIVENESS CONSUMER DURABLES CORPORATE BOND CORPORATE BOND MARKET CORPORATE BONDS CORPORATE GOVERNANCE COST OF LIVING CREDIT CONSTRAINT CREDITORS CURRENCY CURRENCY APPRECIATION CURRENT ACCOUNT DEFICIT DEBT DEBT LEVEL DEBT SERVICE DEBT STOCK DECENTRALIZATION DEFICIT SPENDING DEPOSIT DEVALUATION DEVELOPMENT POLICY DOMESTIC BOND DOMESTIC DEBT DOMESTIC DEBT SECURITIES DRIVERS ECONOMIC GROWTH ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC SECTORS ELECTRICITY EMERGING ECONOMIES ENFORCEMENT MECHANISMS ENFORCEMENT OF CONTRACTS EQUIPMENT ESCROW EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTS EXTERNAL DEBT EXTREME POVERTY FINANCIAL CRISIS FINANCIAL INTEGRATION FINANCIAL MARKET FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SERVICES FINANCING REQUIREMENT FISCAL BALANCE FISCAL DEFICIT FISCAL DEFICITS FISCAL POLICY FISCAL REFORMS FLOATING RATE FOREIGN INVESTORS GDP GDP PER CAPITA GLOBAL ECONOMY GLOBALIZATION GOVERNMENT BUDGET GOVERNMENT DEBT GOVERNMENT DEFICIT GOVERNMENT EXPENDITURE GOVERNMENT FINANCING GOVERNMENT REVENUES GOVERNMENT SPENDING GRANT ALLOCATION GROWTH POTENTIAL GROWTH RATE GROWTH THEORY HEALTH SPENDING HOUSEHOLD INCOMES HOUSING HUMAN CAPITAL HUMAN RESOURCES INCOME INCOME INEQUALITY INCOME LEVEL INFLATION INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE INVESTMENT INSTITUTIONAL DEVELOPMENT INSURANCE INTEREST PAYMENTS INTEREST RATE INTEREST RATE RISK INTEREST RATES INTERGOVERNMENTAL FINANCE INVENTORY INVESTMENT DECISIONS INVESTMENT FUNDS INVESTMENT REQUIREMENTS INVESTOR PROTECTION ISSUANCE JOB CREATION LABOR COSTS LABOR FORCE LABOR MARKET LABOR MARKET ISSUES LABOR MARKET RIGIDITIES LABOR PRODUCTIVITY LABOR UNIONS LAND REFORMS LANDOWNERS LAWS LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LEGISLATION LICENSES LIQUIDITY LIVING STANDARDS LOCAL CURRENCY LOCAL GOVERNMENTS LOCAL INFRASTRUCTURE MACROECONOMIC STABILITY MANDATES MATURITY MATURITY MISMATCHES MATURITY SPECTRUM METROPOLITAN AREAS MULTIPLIER EFFECTS MUNICIPAL BONDS MUNICIPALITIES NATIONAL GOVERNMENTS NATURAL DISASTER NATURAL DISASTERS NOMINAL WAGES OIL PRICE PENSION PENSION FUND PENSION FUND ASSETS PHYSICAL ASSETS PHYSICAL SECURITY POLICY RESPONSE PRICE INCREASES PRICE RISKS PRIVATE BORROWING PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR PRIVATE SECTOR INVESTMENT PRIVATE SECTOR PARTICIPATION PRODUCT MARKETS PRODUCTIVITY PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROFITABILITY PROPERTY RIGHTS PUBLIC PUBLIC DEBT PUBLIC FINANCE PUBLIC INFRASTRUCTURE PUBLIC INVESTMENT PUBLIC INVESTMENT IN INFRASTRUCTURE PUBLIC POLICY PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICES PUBLIC SPENDING REAL GDP REAL INCOME REGULATORY BARRIERS REGULATORY FRAMEWORK REGULATORY STRUCTURES RETAINED EARNINGS RETURN REVENUE COLLECTION RISK AVERSION RISK MANAGEMENT RISK PROFILE ROADS SAFETY SAFETY NET SAFETY NETS SAVINGS SECURITIES SETTLEMENT SOCIAL SERVICES STOCK EXCHANGE STRUCTURAL CHANGE SUBNATIONAL GOVERNMENTS TAX TAX ADMINISTRATION TAX REFORM TAX REVENUES TOTAL FACTOR PRODUCTIVITY TOTAL OUTPUT TRADE BALANCE TRADE LAWS TRANSPARENCY TRANSPORT UNEMPLOYMENT URBAN DEVELOPMENT URBAN INFRASTRUCTURE URBANIZATION VALUATION WAGES WEALTH WEALTH EFFECTS Within the next two decades Indonesia aspires to generate prosperity, avoid a middle-income trap and leave no one behind as it tries to catch up with high-income economies. These are ambitious goals. Realizing them requires sustained high growth and job creation, as well as reduced inequality. Can Indonesia achieve them? This report argues that the country has the potential to rise and become more prosperous and equitable. But the risk of 'floating in the middle' is real. Which pathway the economy will take depends on: (i) the adoption of a growth strategy that unleashes the productivity potential of the economy; and (ii) consistent implementation of a few, long-standing, high-priority structural reforms to boost growth and share prosperity more widely. Indonesia is fortunate to have options in financing these reforms without threatening its long-term fiscal outlook. The difficulties lie in getting the reforms implemented in a complex institutional and decentralized framework. But Indonesia cannot afford hard to not try harder. The costs of complacency, and the rewards for action, are too high. 2014-07-21T17:33:46Z 2014-07-21T17:33:46Z 2014-05 http://documents.worldbank.org/curated/en/2014/05/19705081/indonesia-avoiding-trap http://hdl.handle.net/10986/18944 English en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ Jakarta Economic & Sector Work :: Development Policy Review (DPR) East Asia and Pacific Indonesia

Indonesia : Avoiding the Trap

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