Indonesian Economic Development towards Global Value Chains

Global Value Chains shows a country's economic integration in global trade. The activity of increasing value added in the GVC scheme can describe competitiveness, industrial progress and economic development. This study aims to analyze the competitiveness of global value chains in Indonesia's economic development. This research was descriptive qualitative along with library research methods. The analysis was conducted by relying on GVC analysis tools submitted by Raphael Kaplinsky and Mike Morris 2000 , in the form of rents, governance and upgrading. From the analysis conducted, it was concluded that the aspects of rents that were based on the competitiveness of Indonesian companies were still low. The specialization is still around raw materials and limited manufacturing products, which are mostly upstream with low high tech. In the governance aspect, the environment to support competitiveness and low production power is due to high logistical costs and price and regulatory distortion. In the upgrading aspect, Indonesia is only able to go up one level at the limited manufacturing stage due to its low RandD costs. Hasna Wijayati | Andika Drajat Murdani "Indonesian Economic Development towards Global Value Chains" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-2 , February 2021, URL: https://www.ijtsrd.com/papers/ijtsrd38417.pdf Paper Url: https://www.ijtsrd.com/economics/other/38417/indonesian-economic-development-towards-global-value-chains/hasna-wijayati