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World Bank Supports Move to Accelerate Indonesia’s Economic Growth through Science, Technology, and Innovation

March 29, 2013

New World Bank project aims to build a knowledge-based economy by supporting endeavors in science, technology, and innovation to strengthen national R&D capacity

WASHINGTON, March 29, 2013 - The World Bank is supporting Indonesian efforts to evolve into a knowledge-based economy through a new project designed to strengthen Indonesia’s research and innovation capacity. The Research and Innovation in Science and Technology Project (RISET), approved today by the World Bank’s Board of Directors, supports Indonesia’s endeavors in science, technology, and innovation.

Improving human resources and national capabilities in science and technology is a key pillar in Indonesia’s masterplan to accelerate and expand its economy. Shifting from a resource-based economy to a knowledge-based economy will bring Indonesia up the value chain in a wide range of sectors, with the help of homegrown innovation and a vast pool of human resources,” said Stefan G. Koeberle, World Bank Country Director for Indonesia. “As a knowledge bank, the World Bank will support Indonesia in making this transition by sharing extensive global knowledge in strengthening public science and technology institutes, as well as training and managing advanced human resources.”

Over the medium-term, the Indonesia government hopes to improve people’s welfare and bring the country up the value chain by improving the national science and technology system. In line with this goal, RISET will focus on supporting reforms in seven state institutes in science and technology, namely: the Indonesian Institute of Sciences (LIPI); the Agency for the Assessment and Application of Technology (BPPT); the National Nuclear Energy Agency (BATAN); the National Institute for Aeronautics and Space (LAPAN); the National Geospatial Information Agency (BIG); the National Standardization Agency (BSN); and the Nuclear Energy Regulatory Agency (BAPETEN).

RISET will also support provincial research and development (R & D) agencies in the six economic corridors identified under Indonesia’s masterplan: Sumatra; Java; Kalimantan; Sulawesi; Bali-Nusa Tenggara; and Papua-Maluku Islands. RISET – which will be financed by a $ 95 million loan – will also help strengthen the bridge between research and development (R&D) and national priority areas.

Less than 5 percent of all researchers in Indonesia’s state science and technology institutes hold PhDs. Less than 15 percent hold masters degrees, while the majority hold bachelor’s degrees or lower.  A large part of RISET will involve providing fellowships to raise the academic credentials of hundreds of Indonesian researchers, especially those in science and engineering disciplines,” says Dandan Chen, World Bank Senior Economist for East Asia and the Pacific Region and project team leader.

Around 400 researchers will benefit from upgraded knowledge and skills acquired through degree or non-degree training, and thousands from strengthened industrial and global knowledge exchange. In terms of institutional strengthening, RISET will help research centers define their strategic priorities and upgrade their human resources to match these priorities. Moving forward, it is hoped that a more enabling policy environment for R&D and stronger research institutes would lead to greater investment in R&D. At present, Indonesia’s R&D investment stands at just 0.08 percent of GDP – far below its regional neighbors: China (1.47 percent), Malaysia (0.6 percent) and Thailand (0.26%).


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