2: Country/Economy Profiles

Indonesia
Key indicators, 2014

GDP (PPP) per capita (intl $), 19902014

Population (millions) ...................................... 251.5

GDP (US$ billions) ........................................ 888.6
GDP per capita (US$) ................................... 3,534
GDP (PPP) as share (%) of world total ............ 2.48

Indonesia

12,000

Emerging and Developing Asia

10,000
8,000
6,000
4,000
2,000
0

Global Competitiveness Index

Rank
(out of 140)

Score
(17)

Institutions
7

Innovation

GCI 20152016 ...................................................... 37 ..... 4.5

GCI 20142015 (out of 144) ..................................... 34 ......4.6
GCI 20132014 (out of 148) ..................................... 38 ......4.5
GCI 20122013 (out of 144) ..................................... 50 ......4.4

Infrastructure

6
5

Business
sophistication

Macroeconomic
environment

4
3
2

Basic requirements (40.0%) .......................................49 ......4.8

Market size

1st pillar: Institutions ................................................. 55 ......4.1

2nd pillar: Infrastructure ............................................ 62 ......4.2
3rd pillar: Macroeconomic environment .................... 33 ......5.5
4th pillar: Health and primary education ................... 80 ......5.6

Health and
primary
education

Higher education
and training

Technological
readiness
Financial market
development

Efficiency enhancers (50.0%) .....................................46 ......4.3

Goods market
efficiency
Labor market efficiency

5th pillar: Higher education and training ................... 65 ......4.5

6th pillar: Goods market efficiency ............................ 55 ......4.4
7th pillar: Labor market efficiency ........................... 115 ......3.7
8th pillar: Financial market development ................... 49 ......4.2
9th pillar: Technological readiness ............................ 85 ......3.5
10th pillar: Market size.............................................. 10 ......5.7

Indonesia

Emerging and Developing Asia

Stage of development

Innovation and sophistication factors (10.0%) ...........33 ......4.1

11th pillar: Business sophistication .......................... 36 ......4.3
12th pillar: Innovation ............................................... 30 ......3.9

Transition
12

Factor
driven

Transition
23

Efficiency
driven

Innovation
driven

The most problematic factors for doing business

Score*

Corruption .........................................................................11.7
Inefficient government bureaucracy ...................................10.6
Inadequate supply of infrastructure ......................................9.6
Policy instability ...................................................................8.7
Access to financing .............................................................8.4
Tax rates..............................................................................8.0
Inflation ................................................................................7.1
Complexity of tax regulations...............................................6.5
Poor work ethic in labor force..............................................6.2
Foreign currency regulations ................................................5.0
Government instability/coups ..............................................4.9
Crime and theft ...................................................................4.6
Inadequately educated workforce ........................................2.7
Insufficient capacity to innovate ...........................................2.5
Restrictive labor regulations .................................................2.0
Poor public health ...............................................................1.3
0
*

10

15

20

25

From the list of factors, respondents were asked to select the five most problematic for doing business in their country and to rank them between 1 (most problematic) and 5. The score
corresponds to the responses weighted according to their rankings.

202 | The Global Competitiveness Report 20152016

2015 World Economic Forum

30

2: Country/Economy Profiles

Indonesia
The Global Competitiveness Index in detail
INDICATOR

VALUE RANK/140

INDICATOR

1st pillar: Institutions

VALUE RANK/140

6th pillar: Goods market efficiency (contd.)

1.01
1.02
1.03
1.04
1.05
1.06
1.07
1.08
1.09
1.10
1.11
1.12
1.13
1.14
1.15
1.16
1.17
1.18
1.19
1.20
1.21

Property rights ....................................................... 4.3 ............63

Intellectual property protection ............................... 4.3 ............48
Diversion of public funds ........................................ 3.6 ............56
Public trust in politicians ......................................... 3.7 ............41
Irregular payments and bribes ................................ 3.7 ............86
Judicial independence............................................ 4.0 ............63
Favoritism in decisions of government officials ....... 3.8 ............34
Wastefulness of government spending ................... 3.9 ............30
Burden of government regulation ........................... 3.8 ............41
Efficiency of legal framework in settling disputes .... 3.9 ............53
Efficiency of legal framework in challenging regs. ... 3.9 ............46
Transparency of government policymaking............. 4.1 ............66
Business costs of terrorism .................................... 4.3 ..........118
Business costs of crime and violence..................... 3.9 ..........104
Organized crime ..................................................... 4.1 ..........107
Reliability of police services .................................... 4.1 ............66
Ethical behavior of firms ......................................... 4.3 ............42
Strength of auditing and reporting standards ......... 4.3 ............85
Efficacy of corporate boards .................................. 4.8 ............67
Protection of minority shareholders interests ......... 4.3 ............49
Strength of investor protection, 010 (best)* .......... 6.1 ............42

2.01
2.02
2.03
2.04
2.05
2.06
2.07
2.08
2.09

Quality of overall infrastructure ............................... 3.8 ............81

Quality of roads ...................................................... 3.7 ............80
Quality of railroad infrastructure .............................. 3.6 ............43
Quality of port infrastructure ................................... 3.8 ............82
Quality of air transport infrastructure....................... 4.4 ............66
Available airline seat km/week, millions* .......... 2,842.6 ............15
Quality of electricity supply ..................................... 4.1 ............86
Mobile telephone subscriptions/100 pop.* ......... 126.2 ............49
Fixed-telephone lines/100 pop.* ........................... 11.7 ............80

3.01
3.02
3.03
3.04
3.05

Government budget balance, % GDP*................. 2.2 ............53

Gross national savings, % GDP* .......................... 30.9 ............19
Inflation, annual % change* .................................... 6.4 ..........114
General government debt, % GDP* ..................... 25.0 ............23
Country credit rating, 0100 (best)* ...................... 56.5 ............56

4.01
4.02
4.03
4.04
4.05
4.06
4.07
4.08
4.09
4.10

Malaria cases/100,000 pop.* .......................... 2,268.5 ............47

Business impact of malaria .................................... 4.3 ............48
Tuberculosis cases/100,000 pop.* ..................... 183.0 ..........117
Business impact of tuberculosis ............................. 4.1 ..........124
HIV prevalence, % adult pop.* ............................... 0.5 ............86
Business impact of HIV/AIDS ................................. 3.9 ..........127
Infant mortality, deaths/1,000 live births* .............. 24.5 ............94
Life expectancy, years*......................................... 70.8 ............92
Quality of primary education ................................... 4.2 ............57
Primary education enrollment, net %* .................. 92.2 ............80

5.01
5.02
5.03
5.04
5.05
5.06
5.07
5.08

Secondary education enrollment, gross %* .......... 82.5 ............88

Tertiary education enrollment, gross %*................ 31.5 ............75
Quality of the education system ............................. 4.3 ............41
Quality of math and science education .................. 4.4 ............52
Quality of management schools ............................. 4.4 ............49
Internet access in schools ...................................... 4.8 ............43
Availability of specialized training services .............. 4.5 ............47
Extent of staff training ............................................ 4.4 ............33

2nd pillar: Infrastructure

6.06
6.07
6.08
6.09
6.10
6.11
6.12
6.13
6.14
6.15
6.16

No. procedures to start a business* ........................ 10 ..........116

No. days to start a business* ............................... 52.5 ..........129
Agricultural policy costs.......................................... 4.0 ............52
Prevalence of non-tariff barriers .............................. 3.9 ..........113
Trade tariffs, % duty* .............................................. 4.6 ............64
Prevalence of foreign ownership............................. 4.5 ............67
Business impact of rules on FDI ............................. 4.3 ............87
Burden of customs procedures .............................. 3.9 ............72
Imports as a percentage of GDP* ........................ 23.8 ..........129
Degree of customer orientation .............................. 5.0 ............41
Buyer sophistication ............................................... 3.9 ............32

7.01
7.02
7.03
7.04
7.05
7.06
7.07
7.08
7.09
7.10

Cooperation in labor-employer relations ................. 4.6 ............49

Flexibility of wage determination ............................. 4.3 ..........112
Hiring and firing practices ....................................... 4.3 ............34
Redundancy costs, weeks of salary* .................... 57.8 ..........135
Effect of taxation on incentives to work .................. 4.0 ............43
Pay and productivity............................................... 4.5 ............33
Reliance on professional management ................... 4.7 ............32
Country capacity to retain talent............................. 4.1 ............33
Country capacity to attract talent ........................... 4.1 ............28
Women in labor force, ratio to men* ..................... 0.62 ..........112

8.01
8.02
8.03
8.04
8.05
8.06
8.07
8.08

Availability of financial services ............................... 4.9 ............45

Affordability of financial services ............................. 4.9 ............40
Financing through local equity market .................... 4.2 ............34
Ease of access to loans ......................................... 3.9 ............15
Venture capital availability ....................................... 3.8 ............17
Soundness of banks .............................................. 4.8 ............74
Regulation of securities exchanges ........................ 4.4 ............61
Legal rights index, 012 (best)* ................................. 4 ............80

9.01
9.02
9.03
9.04
9.05
9.06
9.07

Availability of latest technologies ............................ 4.8 ............68

Firm-level technology absorption ............................ 5.1 ............41
FDI and technology transfer ................................... 4.6 ............54
Individuals using Internet, %* ............................... 17.1 ..........113
Fixed-broadband Internet subscriptions/100 pop.* .. 1.2 ..........106
Intl Internet bandwidth, kb/s per user* .................. 6.2 ..........111
Mobile-broadband subscriptions/100 pop.* ......... 34.7 ............76

10.01
10.02
10.03
10.04

Domestic market size index, 17 (best)*................. 5.7 ..............8

Foreign market size index, 17 (best)* .................... 5.9 ............19
GDP (PPP$ billions)* ....................................... 2,676.1 ..............8
Exports as a percentage of GDP* ........................ 22.4 ..........117

11.01
11.02
11.03
11.04
11.05
11.06
11.07
11.08
11.09

Local supplier quantity ........................................... 4.7 ............39

Local supplier quality.............................................. 4.2 ............74
State of cluster development.................................. 4.4 ............28
Nature of competitive advantage ............................ 3.7 ............51
Value chain breadth................................................ 4.3 ............31
Control of international distribution ......................... 4.2 ............36
Production process sophistication.......................... 4.1 ............48
Extent of marketing ................................................ 4.8 ............35
Willingness to delegate authority ............................ 4.5 ............27

12.01
12.02
12.03
12.04
12.05
12.06
12.07

Capacity for innovation........................................... 4.7 ............30

Quality of scientific research institutions ................. 4.3 ............41
Company spending on R&D................................... 4.2 ............24
University-industry collaboration in R&D ................. 4.5 ............30
Govt procurement of advanced tech products ...... 4.2 ............13
Availability of scientists and engineers .................... 4.6 ............34
PCT patents, applications/million pop.* .................. 0.1 ..........102

7th pillar: Labor market efficiency

8th pillar: Financial market development

3rd pillar: Macroeconomic environment

4th pillar: Health and primary education

5th pillar: Higher education and training

6th pillar: Goods market efficiency

6.01
6.02
6.03
6.04
6.05

Intensity of local competition .................................. 5.1 ............65

Extent of market dominance .................................. 3.8 ............56
Effectiveness of anti-monopoly policy ..................... 4.0 ............49
Effect of taxation on incentives to invest................. 4.1 ............31
Total tax rate, % profits* ....................................... 31.4 ............42

9th pillar: Technological readiness

10th pillar: Market size

11th pillar: Business sophistication

12th pillar: Innovation

Notes: Values are on a 1-to-7 scale unless otherwise annotated with an asterisk (*). For further details and explanation, please refer to the section How to Read
the Country/Economy Profiles on page 89.
2015 World Economic Forum

The Global Competitiveness Report 20152016 | 203