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 Dynamics of Regional Development in  Indonesia

Regional development in Indonesia and its dynamics is an interesting topic to discuss. Indonesia consists of regions with different characteristics. These conditions potentially cause complexity in inter-regional development that would lead to uneven development in each region. The government as one of the drivers of development has an important role in the development process. Therefore, regional development needs synergy among development actors that are consist of public, private sector, and the government, both central and local governments.

In general, the development in Indonesia is divided into two parts, i.e. the New Order and the Reformation era. Development in the New Order era tends to be centralized, while in the reformation era tends to be decentralized.

Centralized system emphasizes on the role of the central government in the determining the direction and development in all aspects. Centralized systems had been significantly contributed in the early Indonesian development process. Various development indicators such as economic growth, the rate of growth of per capita income, exports, and infrastructure development showed good performances. The average of economic growth has reached 7.7 percent per year in the period 1971 to 1981 (Hill, 1996). This performance had made ​​Indonesia as one of emerging markets in Asia.

However, the economic crisis in 1997 showed the shortcomings of the centralized system as the drivers of Indonesian development. Various studies show that the Indonesian development is not as it showed in the statistics. There was a disparity of development between Java and non-Java. Infrastructure development which became a catalyst for development, took place only in Java, therefore, development was centralized in Java. The Indonesian government system was then switches from a centralized system into a more decentralized system (Big Bang process).

Decentralized system emphasizes on the role of local government in the development process. The decentralized system put the local government as important actors to accelerate the Indonesian development. This system also make the local governments have greater responsibility in driving the regional development. In line with greater responsibility, local governments are also given greater rights and authority in managing the region (including managing natural resources and local finances). The obligation, right, and authority to manage local area independently called as regional autonomy.

There are various reasons on why regional development is as important and interesting topic to discuss. First, the main point of Indonesian development is in the regional level (especially in the district level). Second, regional autonomy demands an improvement in the quality of development. Third, each region in Indonesia has different characteristics, thus that regional development will also have a different characteristics. The book on "The Dynamics of Regional Development in Indonesia" will discuss and evaluate the regional development in Indonesia in both centralized and decentralized systems. Strategic issues, such as lessons learned from the implementation of government programs, and successful development strategies, will also thoroughly discuss in this book.

This book is intended for stakeholders, related and interested parties in regional development, such as local governments, academics, students, and general public. The book is expected to be one of the references in the discussion of regional development in Indonesia as well as basic information for decision makers in determining the direction of development policy in the region. In addition, this book is expected to provide the latest information on government strategies to improve the regional development.

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