INDUSTRY :

economic activity concerned with the processing of raw materials and manufacture of goods in
factories.

It is any work that is undertaken for economic gain and that promotes employment. The word
may be applied to a wide range of activities, from farming to manufacturing to tourism, and
refers to the production of an economic good or service within an economy.

Classfication of Industry -

Primary Industries

Secondary Industries

Tertiary Industries

Quaternary Industries

Primary Industry

They are where people collect or gather raw materials. It is where the resources are found.
This involves the extraction of resources directly from the Earth, this includes farming, mining
and logging. They do not process the products at all. They send it off to factories to make a
profit.

Secondary Industries

They are those that process or convert the raw materials into finished products.

This group is involved in the processing of products from primary industries. This includes all
factories – those that refine metals, produce furniture, or pack farm products such as meat.

Tertiary Industries

They are the service industries. These include retailing, wholesaling, transport, public
administration, and the professions, such as law, medicine, etc.

This group is involved in the provision of services. They include teachers, managers and other
service providers.

4. Quaternary Industries

These comprises activities that provide expertise and information. Consultancy services and
research organizations belong to this category. This group is involved in the research of science
and technology. They include scientists.

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Some major industries in Indonesia :

Petroleum and natural gas, Textile, Apparel, Footwear, Mining, Cement, Chemical
Fertilizers, Plywood, Rubber, Food, Tourism

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Indonesia has the largest economy in Southeast Asia and is one of the emerging market
economies of the world. The country is also a member of G-20 major economies and
classified as a newly industrialized country.

In the past, Indonesia may have been seen as an authoritarian state, but now it is
recognized as the third-largest democracy in the world.

Indonesia is a globally leading exporter of tin and thermal coal. It has generous natural
resources including:

a) crude oil d) copper

b) natural gas e) gold

c) tin

Major exports include:

a) oil and gas f) rubber

b) electrical appliances g) textiles

c) plywood h) furniture

d) paper products i) electronics

e) automobiles j) footwears

The industrial sector is the sector that currently contributes most to Indonesia's annual
GDP growth. The two most important sub-sectors of industry are:

a) mining

b) manufacturing

The mining industry provides substantial export earnings, employment opportunities

and other economic activities. In 2011 the mining sector contributed around 12 percent
to Indonesia's GDP.

Indonesia recently became the 10th-largest manufacturing nation in the world. It’s large
manufacturing sector accounts for almost a quarter of the nation’s total GDP and
employs over a fifth of Indonesia’s working age population (around 25 million workers).

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Indonesia can diversify the range of products that are

manufactured at home.

It can raise the focus on

further development of the existing manufacturing industries in Indonesia.

Seven Basic Bottlenecks That Obstruct Higher Economic Growth in Indonesia.

improving export performance not accompied by industrial development

Indonesia is too dependent on imports of raw materials and capital goods. This indicates that the
Indonesian economy is not independent.
Lack of incentives and weak market protection obstructs industrial development.

Business and consumer optimism was miserable in the fourth quarter of 2017.

Although improving, Indonesia's investment climate still fails to attract significant investment.
Government spending is not optimal. (means not finest)

The village funds that are transferred from the central state

budget to the regions are not handled optimally, hence public

investment in the regions is not as good as it should be.

Indonesia’s Creative Economy Agency (BEKRAF) forecasts that Indonesia’s creative industry’s growth will
reach new heights in 2018. This prediction is in-line with the rapid progress of the country’s e-commerce
industry that has taken place in the last 5 years.

Indonesia's rich cultural heritage reflects in its long history of crafts, arts and entertainment and provides
a valuable foundation for the creative industries. The country's creative economy features a particularly
large number of small businesses, despite the presence, for instance, of large media conglomerates.
Indonesia has a window of opportunity to establish itself as the regional production hub for the
manufacture of electronics.

Indonesia has an established reputation within the furniture and handicrafts sector within the regional
and global market due to the country’s strong historical traditions in woodwork and artistic crafts such as
batik.

Indonesia’s cosmetics sector performed strongly throughout 2017 in line with the country's growing
middle class and increasingly affluent consumers.

The implementation of halal regulations for cosmetics in Indonesia has proven to be a game changer
with halal cosmetics now starting to dominate cosmetic sales in the country.

Wardah, the country's first halal cosmetic manufacturer, has successfully capitalized on the new trend
and has become a leading cosmetics brand in Indonesia.

Indonesia’s cosmetics and toiletries industry recorded a remarkable growth of 11.99% in 2017 with a
total sales value of 19 trillion IDR.

Tourism

The commercial organization and operation of vacations and visits to places of interest.

Tourism is the activities of people traveling to and staying in places outside their usual environment for
leisure, business or other purposes for not more than one consecutive year.

The tourism industry has flourished and become a major driver of the economy and a central feature of
the government’s economic growth strategy.

The lack of tourism infrastructure and the funds needed to remedy it will be a major challenge for
Indonesia.

The growing “halal tourism” market holds significant potential for Indonesia. Tourism is said to be the
new star of Indonesia's economy based on the Tourism Ministry's recent three-year performance report
announced in Oct. 2017.

The chosen locations of the

“Ten New Balis” are:

1) Lake Toba (North Sumatra)

2)Tanjung Lesung (Banten)

3) The Thousand Islands (Jakarta)

4) Tanjung Kelayang Beach (Bangka Belitung Islands)

5) Borobudur Temple (Central Java)

6) Mount Bromo (East Java)

7) Mandalika (West Nusa Tenggara)

8) Labuan Bajo (East Nusa Tenggara)

9) Wakatobi (South Sulawesi)

10) Morotai Island (North Maluku).

Entrepreneur is a person who organizes and operates a business or businesses, taking on greater than
normal financial risks in order to do so. An entrepreneur is an owner or manager of a business enterprise
who makes money through risk and initiative. In English, it is a term applied to a person who is willing to
help launch a new venture or enterprise and accept full responsibility for the outcome. The most
obvious form of entrepreneurship is that of starting new businesses referred as Startup Company.

TYPES OF ENTREPRENEURS:

1. Social Entrepreneurs

2. Serial Entrepreneurs
3. Lifestyle Entrepreneurs

A social entrepreneur is motivated by a desire to help, improve and transform social, environmental,
educational and economic conditions. The social entrepreneur is driven by an emotional desire to
address some of the big social and economic conditions in the world, for example, poverty and
educational deprivation, rather than by the desire for profit.

Serial entrepreneurs are more likely to experience repeated entrepreneurial success. They are more
likely to take risks and recover from business failure. A serial entrepreneur is one who continuously
comes up with new ideas and starts new businesses.

A lifestyle entrepreneur places passion before profit when launching a business in order to combine
personal interests and talent with the ability to earn a living. A lifestyle entrepreneur may decide to
become self-employed in order to achieve greater personal freedom, more family time and more time
working on projects or business goals that inspire them. A lifestyle entrepreneur may combine a hobby
with a profession or they may specifically decide not to expand their business in order to remain in
control of their venture.

ASEAN Free Trade Area (AFTA) is a trade bloc agreement by the Association of Southeast Asian Nations
supporting local manufacturing in all ASEAN countries. The AFTA agreement was signed on 28 January
1992 in Singapore. When the AFTA agreement was originally signed, ASEAN had six members,namely:

1) Brunei 4) Philippines

2) Indonesia 5) Singapore

3) Malaysia 6) Thailand

The Primary Goals Of AFTA Seek To:

1) Increase ASEAN's competitive edge as a production base in the world market through the elimination,
within ASEAN, of tariffs and non-tariff barriers

2) Attract more foreign direct investment to ASEAN.

What is Industrialization?

It is the process of social and economic change that transforms a human group from an agrarian
society into an industrial one. The Industrial Revolution was a period from the 18th to the 19th century
were major changes in agriculture, manufacturing, mining, transportation, and technology had a
profound effect on the socioeconomic and cultural conditions of the times. It began in the United
Kingdom, then subsequently spread throughout Europe, North America, and eventually the world.

Industrial Labor - In an industrial society, industry employs a major part of the population. This occurs
typically in the manufacturing sector

A labor union is an organization of workers who have banded together to achieve common goals in key
areas such as wages, hours, and working conditions.

The trade union, through its leadership, bargains with the employer on behalf of union members (rank
and file members) and negotiates labor contracts with employers. This movement first rose among
industrial workers.

1st Industrial Revolution

(18th Century) -

Steam - based Machines

It started in the time of the Dutch East Indies government.

2nd Industrial Revolution

(19th – 20th Century)

Electrical Energy- based Mass Production

It is the time of the automotive general fort for line production in Indonesia.

3rd Industrial Revolution

(Late 20th Century) -

Intelligence and Information

Computer and Internet Based Knowledge

4th Industrial Revolution

(Early 21st Century)

Artificial Intelligence
The current government continues to discuss the fourth generation industry or industry 4. 0. In fact,
President Joko Widodo (Jokowi) has also inaugurated a roadmap or road map called Making Indonesia 4.
0.