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From Hong Kong to Singapore, South Korea to Taiwan, the Asian Tigers have been one of the greatest economic success stories in recent history. These countries have all experienced rapid growth in their economies, and have witnessed the rising standards of living that comes with it.
But there’s another potential Asian Tiger that has yet to find its roar; Indonesia. Indonesia has many qualities in common with the existing Asian Tigers, and yet it so far hasn’t reached the highest heights of its full potential. Let’s look into why this is, and how Indonesia could join the rest of the Asian Tigers as one of the innovation powerhouses of the world.
Indonesia has not been part of Asia’s economic revolution.
After undertaking a range of studies, the Indonesian government and OECD believe there’s one key reason why. Because, while the Asian Tigers focused on the development of high-tech industries, Indonesia remained reliant on exporting natural resources. Poverty is rife throughout the country, and the per-capita GDP is fairly low. Indonesia has failed to attract much in the way of overseas investment, and has fallen behind in the development of the structure needed to support tech-intensive industries. For Indonesia, tech product imports are far higher than exports. All of which poses a problem.
While it seems obvious that Indonesia needs to shift its focus towards the tech world, this shift hasn’t yet happened. Right now, Indonesia still comes in under the ASEAN average for factors such as innovation, R&D spend, applications for patents, and publication in scientific journals.
In spite of all this, Indonesia is made for innovation.
With a youthful population, fast-improving education system, and ever-growing middle class, Indonesia is fertile ground for innovation. The country is continuing to grow its number of STEM graduates (that is, those in the fields of Science, Technology, Engineering and Maths). So much so, the G20 predicts that by 2030, Indonesia will be the fourth biggest producer of graduates in STEM fields.
It’s not just us or the G20 who say so. Indonesia’s own government also believes the country has the potential to achieve high levels of innovation. Recently, the Indonesian government has begun working to build up the country’s innovation system. As part of this work, they’ve introduced an initiative called ‘Making Indonesia 4.0’.
What is ‘Making Indonesia 4.0’?
It’s Indonesia’s very own government-backed ecosystem just for digital start-ups. Under this initiative, the country’s start-up ecosystem is growing slowly but surely. ‘Making Indonesia 4.0’ is all about the important role technology will play in the country’s future. Providing mentorship, much-needed resources, and infrastructure, the initiative is designed to encourage entrepreneurs to start up new companies, and bring new ideas to life.
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According to the headlines, ‘Making Indonesia 4.0’ is working. The initiative has led to the creation of three start-ups valued at over $1billion (known as ‘unicorns’) and one with a staggering valuation of over $10billion (known as a ‘decacorn’).
That said, there are still a number of challenges holding back Indonesia’s entrepreneurs from success. And perhaps the biggest is access to adequate start-up funding.
R&D funding in Indonesia today largely relies on the central government
In Indonesia, R&D is largely undertaken by universities and established centers for research. There’s a system in place which sees the Indonesian government distribute R&D funding, which mostly goes towards these government-led organizations. This leaves behind a big funding gap for entrepreneurs and non-government businesses. And this means that the tech start-ups needed to turn Indonesia into a new Asian Tiger are going without the funding that’s critical to their survival.
Indonesia needs to take a big leap in the competitiveness rankings
It’s true that Indonesia has seen a big recent rise in competitiveness – jumping from 43rd out of 63 economies in IMD’s 2018 World Competitiveness rankings, to 32nd just a year later. But still, this improvement is counteracted by a lack of R&D investment compared to the country’s key competitors. For example, the World Bank’s 2018 ‘Doing Business’ index saw Indonesia ranked 134th out of 190 countries – with a score of 81.2/100 in ‘starting a business’. And when it comes to patent applications, Indonesia made only 37 in the entire year of 2017. That put it at a disappointing 83rd out of 100 in a ranking of the number of patent applications per million citizens.
Technology will drive Indonesia’s transformation
The Asian Tigers became Asian Tigers because of tech innovation – and the same will be key to ensuring Indonesia joins their ranks. If Indonesia is to grow its productivity and competitiveness levels, the country’s companies will need to jump on board the tech train. This is the only way to unlock the latent ambition of Indonesia’s entrepreneurs, and see their ideas become realities.
The existing Asian tigers took a 3-step approach:
- They built their capabilities within key tech industries
- They changed their focus from importing to exporting
- They worked to encourage local competition
None of the above three steps would have been possible without funding for the Asian Tigers’ highly driven entrepreneurs. And while Indonesia has similar levels of entrepreneurial ability, there’s one thing the country is lacking; the required funding, at the required scale.
The Dacxi Chain is designed to close the funding gap
Billed as the ‘world’s first global tokenized equity crowdfunding system’, the Dacxi Chain aims to unlock a whole new level of funding for innovative entrepreneurs and businesses. Using blockchain technology, the Dacxi Chain creates digital versions of company shares. These shares can then be bought and sold by anyone, anywhere in the world – with none of the traditional barriers of geography, culture, language, or financial systems.
Innovation has no race or religion. It has no culture or gender. What it has is brilliant ideas and talented entrepreneurs, who are ready to change the world. And Indonesia is filled with them. If they had access to the funding they need, when they need it, Indonesia’s entrepreneurs would have the ability to transform the country into the Asian Tiger it could be. All it needs is the right system to make it happen.
This is what the Dacxi Chain provides. Reaching past the scope of the Indonesian government’s R&D funding system, the Dacxi Chain will offer a critical new way to access funding. It will connect entrepreneurs with funding opportunities all over the world, and will connect investors with financial opportunities they could previously only dream of. All within a simple, easy, and highly-regulated platform.
The importance of building local business ecosystems.
Around the world, there have been numerous examples showing how just one successful business can change an entire country’s business ecosystem. This is because other businesses crop up to service the original business. The economic benefits multiply, and the whole community’s quality of life improves.
Nokia is a great example of this in action. The Finnish telco giant, Nokia, was once a rubber boot manufacturer. When it evolved into a technological world-leader, it earned its shareholders a fortune – and saw the birth of thousands of small tech businesses. Together, these smaller companies turned Finland into the thriving tech country we know it to be today.
According to Dacxi, the Nokia effect could easily take place in Indonesia. With an effective and efficient global tokenized crowdfunding system in place, Indonesia’s entrepreneurs can make their biggest business dreams come true. And the Dacxi Chain can help them do it. It can provide the platform needed to create a whole new tech economy – and turn Indonesia into the Asian Tiger it should be.
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For the latest information on Dacxi Coin and the Dacxi Chain, visit dacxicoin.io. You can download the Lightpaper, and join the Dacxi Coin telegram community. For media enquiries please contact pr@dacxi.com
This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.
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