Optimizing the Role of the Service Industry in the Regions in Supporting National Economic Growth

Saturday, March 11 2017, UNAIR Faculty of Economics and Business held a dialogue with the theme of optimizing the role of the service industry in the regions in supporting national economic growth. The agenda is a collaboration between FEB UNAIR and Indonesian Services Dialogue (ISD), an NGO that focuses on conducting studies, research and providing policy recommendations related to the service industry.

As the main speaker in the dialogue, the Mayor of Surabaya, Ir. Tri Rismaharini, Prof. Dr, Mari Elka Pangestu, who was the Indonesian Minister of Trade for the Period 2004-2011 and the Minister of Tourism and Creative Economy 2011-2014, and Ir. Herliza, MSc as Director of Trade in the Services Sector of the Ministry of Trade of the Republic of Indonesia.

Mrs. Risma started as the first speaker by delivering her presentation about the very rapid development of the service sector in the city of Surabaya, this can be seen from the many new SMEs engaged in the printing, design, and internet marketing service sectors. Furthermore, Mrs. Risma conveyed that one of the flagship programs of the city of Surabaya is called “Economic Fighters”, namely assistance and appreciation for Surabaya residents who successfully run a business in any form and are then able to empower the community through their efforts.

Prof. Dr. Mari Elka became the second speaker to convey about the potential of the service industry both nationally and locally in Surabaya, from the data he cites, it is known that the contribution of the service sector nationally is 55% of GDP in 2014, and 77% of GDP in Surabaya. A very large number considering the situation in the manufacturing industry which is currently experiencing negative growth.

This enormous potential needs to be optimized, several steps that he proposed for the optimization, the first is strengthening infrastructure conditions, implementing regulations that increase market access and encourage innovation, intensify the digitization of economic activities, and the last but somewhat debatable is zero VAT (0% additional tax) for service exports.

As the last keynote speaker, Mrs. Ir. Herliza, who on that occasion highlighted the role of international trade negotiations in the success of Indonesia's target to gain benefits from the trend of international trade liberalization, especially in the service sector. (MKM)