Mapping Industrial Corridors

Abstract

Industrial development plays a significant role in increasing a country's economic growth and competitiveness. Some countries expand their industrial development using corridors or special economic zone. However, limited publication is found regarding how a nation dealing with their industrial corridor and its impact to economic growth. This research is aimed to evaluate the focus of industrial development of Indonesia by taking into account Sulawesi corridor, Bali-Nusa Tenggara corridor, and Maluku-Papua corridor located on eastern part of the country. These corridors are expected to improve economic activities in the region and increase the national competitiveness in general. Data were obtained through pairwise comparison and analyzed using a location quotient (LQ), which aims to rank overall potential industries in a particular region. While pairwise comparison was used to process the result from LQ analysis to determine the industry with the highest potential by taking into account variables related to regional development extracted from public records. The research found two alternative scenarios for the decision-making process based on development cost, government capacity, and completion time. The first scenario considered government ability to fund all required projects to support the country's economic expansion in the future. While the second scenario evaluated a limited budget from the government allocation to accelerate infrastructure development. Both scenarios are used to make opposing decisions that need to be considered in the nearest future. The result is used as an academic exercise for those interested in regional development, government officials dealing with the economic masterplan, and other stakeholders in both national and international.