The Impact of Dependency on Primary Commodity on Indonesia Economic Growth

This paper analyze on Indonesia economic growth as one of commodity dependence countries to see to what extent does Indonesia dependence on commodity production and what is the significant of the dependency. The research uses exploratory data analysis method to analyze the data and extract important information regarding Indonesia dependency on commodity. In this paper the writer found that the dependency on commodity doesn’t have strong evidence of resource curse adverse impact presence on Indonesia economic growth. Dutch disease and terms of trade deterioration does have correlation on its dependency but it is not causal relationships which hamper its growth. Indonesia in the early stage of development in 1970s rely heavily on commodity exports revenue but Indonesia dependency tend to decline as they have move forward to industry oriented development by using its commodity windfall revenue.