DO EXPORTS OF OIL AND GAS STILL MATTER FOR REGIONAL ECONOMIC GROWTH OF SUMATRA, INDONESIA?

Saiful Hurri (), Said Muhammad (), Abd. Jamal and M. Shabri Abd. Majid
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Saiful Hurri: Ph.D. Scholar in Economics, Faculty of Economics and Business, Universitas Syiah Kuala and Senior Lecturer, Universitas AlMuslim, Bireuen, Indonesia
Said Muhammad: Professor, Faculty of Economics and Business, Universitas Syiah Kuala, Indonesia

Regional Science Inquiry, 2019, vol. XI, issue 2, 9-18

Abstract: Although Indonesia ranks as the world's 17th oil and 6th gas producing country, but its production level has been slowly declining since the last few decades. Amidst the decline of oil and gas production, thus it is important to explore how this impacts the regional economic growth. Specifically, this study attempts to empirically examine the impact of oil and gas and non-oil and gas exports on the regional economic growth of Sumatra, Indonesia over the period 2008-2017 using the generalized method of moments (GMM) approach. The study found that oil and gas exports were no longer contributed positively to regional economic growth. On the other hand, non-oil and gas exports have positively contributed to regional economic growth. This implies that to further promote the growth of the regional economy the focus should be given on the expansion, value-added creation and diversification of non-oil and gas commodities.

Keywords: Regional economic growth; Oil and gas sector; Non-oil and gas sector; GMM; Sumatra. (search for similar items in EconPapers)
JEL-codes: C32 F43 O11 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hrs:journl:v:xi:y:2019:i:2:p:9-18

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