Indonesia Economic Activities

By | December 23, 2021

Agriculture, as we have already pointed out, has the first place among the activities of Indonesians. About 70% of the active population (40,666,000 units) is dedicated to working in the fields, addressing two very different forms of land use: plantation agriculture, in slight but significant decline, and subsistence agriculture, which is rapidly increasing. The cultivated land is approximately 1,800,000 ha, equal to 9.5% of the territorial surface. The forest area is much larger (121.800.000 ha, equal to 63.9% of the territorial surface), while a considerable part of the territory is still unproductive, especially in Western Irian.

Among the main crops, rice, a fundamental element of the local diet, should be mentioned above all. It is cultivated on 8,560,000 ha and currently has a production of about 200 million q per year, a value almost double compared to that of twenty years ago (110 million q in 1955), which places the Indonesia in third place in the world after China and the Indian Union. Rice is mostly grown by flooding, which very often allows for two harvests per year. Today the largest rice-growing area is the Javanese one, which is also the most irrigated area, thanks to the excellent canalization practiced, where the highest yields per hectare are obtained; but rice is also spreading to the islands of Sumatra, Borneo and Bali. Other food products are corn (2, 5 million ha with production of 25 million q per year), cassava (1,350,000 ha and 101 million q) and sweet potato (350,000 ha and 21.5 million q). Horticulture and the cultivation of oil plants (soybeans, peanuts, oil palm) are among the traditional cultivation practices of the Indonesian population that were once most affected by the spread of colonial plantations: however today they are carried out mainly in small plots around the villages. For Indonesia 2007, please check

Plantation agriculture, despite having undergone a contraction in the area invested in it in recent years, still retains a prominent place in the town’s economy, thanks to both the high unit yields and the still significant extension.

Sugar cane (170,000 ha, almost all in Java) annually produces about 10 million q of refined sugar and 2.8 million q of non-centrifuged sugar, almost all of which are destined for internal consumption.

Even more widespread, especially in the eastern section of the island of Java, is coffee which is grown on a total of 400,000 hectares and produces a production of around 2 million q per year (fifth place in the world). Tea is widespread along the western strip of the island of Java, on extensive plantations (100,000 ha and 670,000 q); the tobacco, of high quality, is grown in Sumatra and to a lesser extent in Java (165,000 ha and 756,000 q). An important role in the economy of the country is played by the coconut palm, present on almost the entire state territory: the production, annually exceeding 5 million t of walnuts and 8 million q of copra, also feeds a fair current of export and comes, for its qualitatively better part, from the cooperatives of Celebes and the southern coasts of Kalimantan and Java. On the other hand, the importance of spices (pepper, etc.) and quinine, which are not in demand today, is reduced, as well as of textile plants (kenaf, cotton, agave sisalana) whose production is modest.

Forests, as we have said, cover almost 70% of the territorial surface; therefore the forestry patrimony represents an immense resource for the country, for the production of both precious woods (Java teak), and construction trees (ebony, sandalwood), dyed, resin and palm trees. Not all the immense forests are fully exploited, also due to the difficulties in transporting timber, whose production today exceeds 130 million m 3 per year.

Among the forest resources, rubber (Java, Sumatra, Kalimantan) deserves a separate mention, which with 870 million tons per year is the main industrial product and ranks Indonesia in second place in the world after Malaysia. Former plantation crop, now nationalized, it is mostly practiced by direct farmers.

Livestock farming (6,250,000 cattle, 2,850,000 buffaloes, 7 million goats, 3 million sheep and 33 million pigs, the latter reared by the non-Muslim populations of Bali) is only a marginal activity, while fishing is of greater importance for the economy of the country, practiced not only along the coasts (1.3 million tonnes of fish landed in 1974 and then pearls and corals) but also inland (carpiculture in Java, carried out with modern practices).

From the mining point of view, the Indonesian subsoil is still to a great extent to be discovered: however, based on the mineral prospecting carried out to date, it can be said that it is very rich in oil (the fields of Sumatra, Kalimantan and Java have given in 1974 67,980,000 t of crude oil to which 5,652 million m 3 are addedof natural gas). There is also no shortage of coal (districts of Bukit Asem and Sawahlunto in Sumatra and of Mahakam and Prapatin in Kalimantan, with production of 156,000 t) and tin (deposits on the island of Riau, Singkep, Bangka, Belitung, with production of 22,800 t of tin, which places Indonesia in third-fourth place in the world, after Malaysia and Bolivia, in competition with Thailand). Other minerals are bauxite from Riau island, Java manganese, Celebes nickel, gold and silver extracted from the mines of Lebong, Tandai and Meulaboh in Sumatra and Citondang in Java, and diamonds and salt.

However, it is above all oil that has a dominant weight due to the impetus given to the country’s industrial development. In fact, Indonesian law provides that the oil produced (since 1971 the exploitation of offshore fields has also begunAlso influenced by the presence of oil are the chemical industries (soda in Waru and fertilizers in Palembang and Cilacap) and the cement plants in Padang and Gresik. But the industry in Indonesia is slow to take off both due to the scarce exploitation of electricity (2932 million kWh in 1973) which makes the energy sector weak, despite the good potential possibilities, and due to the presence of conspicuous foreign capital in some productive branches of vital interest, both due to the poor entrepreneurial capacity of the population.

The most active industrial branches today are the textile sector, in which numerous plants also process mainly imported cotton, and the food sector (sugar refineries, breweries, rice mills, etc.). It therefore follows that while the extractive industries take advantage of the opening to large international markets, the manufacturing ones are still mainly destined for internal consumption and are almost artisanal in character. To these industries we must add the tobacconist (cigar and cigarette factories), the factories for assembling cars and radio equipment and finally the traditional indigenous productions (batik fabrics and bamboo hats).

Indonesia Agriculture