Indonesia has one of the world’s youngest populations, which is expected to boost the country’s labour productivity in the next few years. But they lack skilled workers in areas such as information systems and technology; and artificial intelligence and robotics, among others.
The youth of Indonesia will greatly benefit from the US$ 200 million loan that the Asian Development Bank (ADB) has approved.
According to a recent report, the bank has approved the loan to upgrade four higher education institutions in Indonesia.
The loan will also be used to improve the technical and vocational training programs that will help the youth obtain the job skills needed in the evolving global economy.
The Advanced Knowledge and Skills for Sustainable Growth Project will improve the quality of education and research in three universities in Sumatra—Jambi, Riau, and Malikussaleh in Aceh—and the Indonesia University of Education in Bandung, West Java.
The project will strengthen their collaboration with industry, as well as with international and domestic universities.
Moreover, it will finance the construction of new lecture halls, laboratories, and other infrastructure equipped with climate-proofing design features.
Research centres for sustainable agriculture and natural resources, and also for marine and aquatic science will be established in the three universities in Sumatra.
These research centres will provide support for local economic development.
Improvement on the quality of teaching and vocational education areas such as information systems and technology; artificial intelligence (AI) and robotics; industrial instrumentation engineering; and renewable energy engineering will be the focus of the Indonesia University of Education.
According to ADB Senior Social Sector Specialist Mr Rudi van Dael, Indonesia has one of the world’s youngest populations, which is expected to boost the country’s labour productivity in the next few years.
It is significant that this young working population has the skills that the labour market demands.
With the assistance from the Bank, student access to higher education will increase. Furthermore, it will support the advancement of skills and knowledge among Indonesia’s youth.
An increase in higher education enrolment has been observed in Indonesia. From the 4 million in 2004, it became 7.5 million in 2018.
Despite the increase, the country still faces a shortage of skilled workers as its economy shifts to more technology-intensive and services industries.
These industries require higher levels of technical proficiencies in areas such as data mining and robotics.
The demand for students majoring in engineering and technology is high. With 20% of the students enrolled in these fields, there is room for growth.
Students can benefit if their skills meet the demands of the job market and if teachers have the qualifications to teach.
The total cost of the project amounts to US$ 266.5 million, with the Government of Indonesia contributing US$ 66.5 million.
It is expected to be finished by the end of 2023.
The Bank is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 67 members—48 from the region. In 2017, ADB operations totaled $32.2 billion, including $11.9 billion in co-financing.
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