During the 1950s, Sumitro Djojohadikusumo contributed in a significant manner to the construction of the economy of Indonesia, along with other figures, namely Mohammad Hatta, Sjafruddin Prawiranegara, and Djuanda Kartawidjaja. During this period, Sumitro promoted policies to drive industrialization in Indonesia and self-reliance to transform Indonesia from a colonial economy into a developing nation. Soemitro Djojohadikusumo’s economic policies were pivotal in shaping Indonesia’s post-colonial economy; focusing on production and industrial sovereignty, he emphasized reducing dependency on imports by fostering domestic industries, especially strategic sectors like heavy industry and natural resource processing, which he saw as crucial to national sovereignty. Soemitro also promoted stimulating economic activities through both public investment and private sector engagement, aiming to diversify the economy and drive sustained growth. Many of the challenges Soemitro addressed, such as infrastructural gaps and weak technological readiness, which remain relevant today. This research analyzes to what extent the economic policy shaped by Sumitro impacts Indonesia’s development. This analysis has significance in understanding Indonesia’s contemporary economic planning and trends, particularly in terms of economic policy shaped by the newly elected President of Indonesia, Prabowo Subianto. Analysis of Sumitro’s policy is conducted through the lenses of the industrial maturity concept, which is relevant to growth theory, resource-based view, and development economics. Indonesia’s pursuit of industrial maturity is crucial for transforming its raw resource-based economy into one that competes globally by adding value to domestic production. The need to revitalize manufacturing and strengthen downstream industries is critical for boosting competitiveness and integrating circular economic principles that emphasize sustainability. Soemitro’s vision of empowering society aligns with modern approaches to creating a more inclusive economy. However, infrastructure bottlenecks, a lagging education system, and regulatory complexities continue to slow the progress. Addressing supply chain challenges through regional industrial clustering and focusing on efficiency will be vital for overcoming these barriers. Further empirical research is needed to explore how infrastructure, education reform, and regulatory simplification can enhance Indonesia’s industrial maturity and sustainable economic development.
Tag: industrial maturity
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Waqf Business Model (WBM): Towards A Sustainable Social Business Model on The Mainstream Economics
The Waqf Business Model (WBM) represents an innovative and transformative approach to establishing a sustainable social business model within mainstream economics, rooted in Islamic economic principles. This paper explores the current state of waqf as an alternative model for social business, emphasizing its ability to combine social impact with long-term economic sustainability by preserving assets and generating ongoing revenue. It also advocates for integrating WBM into the mainstream economy to serve as a powerful mechanism for addressing the Sustainable Development Goals (SDGs). The paper highlights the challenges faced by traditional Islamic economic institutions, particularly waqf, which have struggled due to outdated management practices and a conceptual crisis regarding the role of waqf in modern economies. Revitalizing waqf institutions requires enhancing their capabilities and aligning them with contemporary business strategies. Additionally, this paper encourages future research to explore how WBM can be fully integrated into the existing economic ecosystem. In theory, WBM provides a framework for ethical and inclusive economies, while in practice, it has the potential to create self-sustaining institutions that reduce reliance on external aid, offering an innovative solution to global socio-economic challenges by blending sustainable innovation.
