Analysis of Indonesia’s Attractiveness as an Offshoring Destination Compared to China, India, and ASEAN Countries

Lim Sanny* and Jonathan Okto Kurnia
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Lim Sanny*: Management Department, BINUS Business School Undergraduate Program, Bina Nusantara University, Jakarta, Indonesia 11480
Jonathan Okto Kurnia: Management Department, BINUS Business School Undergraduate Program, Bina Nusantara University, Jakarta, Indonesia 11480

The Journal of Social Sciences Research, 2019, vol. 5, issue 5, 985-994

Abstract: The research study addressed the problem of Indonesia’s potential economic growth and the country’s attractiveness as an offshoring destination. As a developing country and the fourth most populous country in the world, the future of Indonesia’s economy is bright. However, Indonesia is still not as famous as India nor China as an offshoring destination. First, the researcher wanted to understand the situation of Indonesia’s economy and what can be improved to be an attractive offshoring destination. Then, this research was using A.T. Kearney location criteria index and Farrell framework that were adopted in previous studies about the topic. The data gathered from secondary and primary sources were analyzed with the content analysis method. Result shows that Indonesia needs to ensure attractiveness and an increase in wage demand needs to be supported with the increase in the availability of more educated and government’s effort in accelerating the infrastructure development, although corruption, unstable politics, and diminishing purchasing power still produce doubts to do business in Indonesia.

Keywords: Indonesia; Offshoring; Developing countries; Outsourcing; Unemployment rate; India; China; ASEAN. (search for similar items in EconPapers)
Date: 2019
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