Indonesian Education at Crossroads: Bringing Opportunities to Outside Providers

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Indonesia is at a cross roads. The East Asian country of some 255 million people is rapidly developing itself into a leading global economy. It is already in the top 20 national economies and is aspiring to reach the top 10 by 2030. As a result the county is quickly expanding with rapid urbanization and social development on the backs of a rapidly expanding middle class. Meanwhile South East Asia poised to form a major federation of regional countries like the EU under the banner of ASEAN. Indonesia is expected to take a major place in the new organization.

However, Indonesia’s ambitions are hobbled by a long standing underinvestment in education. Ranked 69th out of 124 countries in a World Economic Forum Report on the Human Capital Index (a report examining how well countries made use of their human resources), it is notably behind many of the other countries in the region whom it will soon be partnering with. For example, Singapore was ranked 24th, the Philippines 46th, and Thailand in positon 57.

If this position is permitted to continue long term, it will have ongoing consequences for the country’s development effort. It will become reliant on other countries within the ASEAN group for expertise and innovations will come only from abroad, not from home grown Indonesian companies and entrepreneurs. This will have serious problems for employment, already endemic among young Indonesians with as many as 1 in 5 under 25’s not in work or further education.


Government Influence

EngineerOne problem currently faced by the country is that its higher education sectors are not producing graduates suitable to the needs of business and industry. For example, to build the infrastructure Indonesia needs an estimated 50,000 new engineers are needed every year. Currently however, Indonesia produces only 30,000. Businesses also struggle to source managers and professionals which will hurt competitiveness further as the country becomes a part of ASEAN.

Much of this stems from the huge desirability of teaching jobs in the country in recent years. Following the passing of the Teacher Act in 2005, Indonesian graduates who train, qualify and go on to work as teachers are entitled to an allowance of up to 100% of the salary of a newly qualified teacher. As a consequence, the majority of Indonesians University students are enrolled in some form of teach training alongside their studies and 1 in 5 is enrolled in a subjects deemed advantageous to a job as a teacher such as law, social science or economics.

Though this has caused a disparity for the time being, creating a new army of teachers is seen as the essential first step to building a modern educational system throughout Indonesia. This has been backed up by a huge increase in the amount of funds allocated to education to US $2.67 Billion dollars.

Further expansion plans are equally as ambitious. The government wants to have a community college in every district in the country, to triple the number of students in technical programmes, increase the number of doctoral students five-fold by 2025 and to drastically increase the pool of students suitable and ready for higher education.

Topping all of this is the Indonesian Governments plan to create a new national body, the Ministry of Research, Technology and Higher Education.  With an approximate budget of US$ 3.2 Billion dollars and a presidential mandate, this new ministry is intended to be the main thrust of Indonesia’s efforts to boost its education achievement.

The new Ministry is founded from a merger between the two prior ministries that of Education and Culture and the other of Research and Technology. By bringing these together into one singly body the aim is to create a focal point that leads the way for future investment and policy development.  One example of this is the creation of a new higher education body to oversee both public and private sector higher education institutions. Previously there was a separate body overseeing the 3000 private sector institutions but now they will all be held to the same standards under one body.


New Opportunities

All of this provides significant opportunities for educational providers from outside the country who are able and willing to align themselves with the Indonesian national ambition for improving education in the country.


Outside bodies can find significant opportunity in providing training and skills in sectors that the Indonesian system does not yet have sufficient capacity for. Furthermore new and existing colleges and universities throughout the country will be eagerly looking for international partners for student exchanges, study programmes and more.

With the entire region poised for an economic renaissance on the back of the ASEAN foundations, it’s a great time for educators looking to expand to consider the region and separate countries like Indonesia especially.

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