The Role of Offset in the Enduring Gestation of Indonesia’s Strategic Industries

Curie Maharani and Ron Matthews

Defence and Peace Economics, 2023, vol. 34, issue 7, 981-1002

Abstract: The purpose of this paper is to examine the performance of Indonesia’s informal offset policy over the period 1976-2014. The paper offers four original academic perspectives: firstly, it is framed by reference to what Indonesia’s former Minister of Technology, Dr Habibie, described as the Progressive Manufacturing Plan, a novel approach in which offset was intended to play a critical supportive role in the systematic development of strategic civil-military industries; secondly, the analysis is structured into three distinctive ‘development-survival-revival’ industrialisation stages that impacted on the performance of both offset and the broader defence economy; thirdly, the study is uniquely different in the sense that the offset case studies all occurred in an era absent of a formal offset policy regime; and lastly, the study provides a wealth of rich data in a subject field well-known for its sensitivity, if not secrecy, and thus is characterised by a paucity of empirical evaluation.

Date: 2023
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DOI: 10.1080/10242694.2022.2065423

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