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Indonesia is distinguished for its natural resources and infrastructures. The ability to develop its own self, this country is really dependant by the technology of heavy equipments. Even its often overshadowed and undermined by poverty and corruption still heavy equipments in Indonesia takes major part in many aspects. Globalization really makes many countries would rely their welfare on Indonesias resources and infrastructure. But on the other side Indonesia seems loyal to its predicate as the heavy equipment consumer, its shown on the highly dependent of our country to their technology. As long as we get our ground scratched down for decades, the awareness of our independence on the technology is also fade away. This study recovers some of the heavy equipments that were discovered through internship in most coal mines in Kalimantan and through internet information. An analysis of this internship yields that Indonesia hasnt get the full endorsement from the government to unfold the technology. The discovery add nuance to our understanding of what is the real matter that interfere our technology independence. This study is part of a growing body of research on non Indonesian perspective of the technology. By using a largely source of field experience, internet information and oral information; this project will contribute to future observation on similar topics.


Abstract . Table Of Content . List of Figure . List of Table .. Preface .. 1. Chapter I : Introduction

i ii iii iv v

I.1 Background 4 I.2 Conclusion..... 4 I.3 I.4 I.5 2. Chapter II : Purpose of Observation.. 4 Problem Identification. Scope of Problem Theory 5 5

II.1. Theory 6 3. Chapter III : Methodology III.1: Methodology. 11 4. Chapter IV : The Result of Observation Result : . 5. Chapter V : Conclusion 11

Conclusion 13 References 13

CHAPTER I Introduction

I.1 Background

The technology of heavy equipments took major part in most mining, agriculture, and infrastructure sectors. Indonesia as one of the developing country rely its natural resources in this technology. For almost half of century Indonesia was seen unlikely to develop its own technology and being attached by the foreign technology although the country was known for its natural wealth. The main obstacle is the lack of support from the government for its knowledge, as a result each day our dependency for their ingenuity gets higher every time, the awakening is still below the ground and yet never discussed by the government.

I.2 Conclusion

Heavy equipments in our era are extremely required as they must be to develop, technological, economical developments. With respect to science, the detachment from the non local technology is the key factor. For example, Indonesia used its mining resources to trade with the foreign technology, because we need their technology for development and they need the resources for their country, but it never comes to mind to evolve our very own technology so that we can be independent cultivating our natural affluence. Even though it seems that our resources is endless but still autonomy becomes priority to develop our own land without dependency.

I.3 Purpose of Observation

The purpose of this observation is to know about the real problems about the reason why Indonesia still kept its dependency to non local heavy equipments technology.

Readers are expected not only to be aware of it but also can change our countrys outlook for the better future.

I.4 Problem identification

There is always a problem in a country that must be resolved. There are many factors that influence a nation for becoming independent. This paper will examine some of the problems that lead to the main issue with examples from the reality. This includes the development of heavy equipments in Indonesia for the last five years as well as comparing and contrasting them with each other. This problem will also describe the need of Indonesia to build its own technology in the future. The progress from the last five years was tremendous. It can be seen in the rising number of the investment on each year despite the downturn in 2009 after the global crisis, still a year after that, the number was back on track and having an enhancement. Many sectors in this country that rely on heavy equipment industry such as mining; timber, agriculture and infrastructure. As a matter of fact these sectors are not fully explored yet only in a few large islands of Indonesia. By examining all the aspects from each year and taking into discussion what is needed, it comes into a few questions why Indonesia hasnt get their own technology?, when Indonesia going to be independent?

I.5 Scope of problem

In this paper writer only discuss the development of heavy equipment needs in the last five years, the prospect of heavy equipments in Indonesia and the obstacle for being an independent country.

CHAPTER II THEORY II.1 Theory Heavy equipment industry in 2010 was able to rise again after the last collapsed in 2009 as the impact of the world financial crisis as a result not only many construction projects and properties are suspended but also the difficulty to acquire financing for the purchase of heavy equipment because of the financial sector when it was hit by the world financial crisis causing disbursement of loans from financial institutions is difficult to obtain. Heavy equipment industry had suffered from the global financial crisis in 2009. Production of heavy equipment nationwide decreased from 5914 units in 2008 to only 1814 units in 2009. A major manufacturer of heavy equipment in Indonesia, like Komatsu, Caterpillar and Hitachi had experienced sales derivation While in the year 2008 heavy equipment industry encountered a rapid growth through the great tremendous of mining coal and expansion of gardens oil palm. Similarly, construction and property sector grew rapidly as a result the demand for a variety of heavy equipment was very high. In that time many purchase orders of heavy equipment must wait for more than six months because of the heavy equipment manufacturing was not capable to fulfill the orders which has been exceeds the ability of its production capacity. When the global financial crisis happened in the mid of 2008, the impact on the heavy equipment industry was felt in 2009, because until the end of 2008, the sale of heavy equipment is generally only to fulfill the orders that have been made earlier. The fluctuation of the financial crisis was felt in 2009 because of the adjournment on the projects and so does it affect the heavy equipments purchase plan, such as property and construction projects. Generally, the barriers that occur was on the trouble for financing the project, for some project that was still on its way like coal mining and oil palm plantations, procurement of heavy equipments was becoming difficult because the financing was tough. Entering the year of 2010, the heavy equipment industry can bounce back, because the global financial crisis did not have much impact on the economy of Indonesia. Coal mining makes another purchase of heavy equipment and so does the oil palm plantation project. Meanwhile, property projects have started to rise in line with the recovery of the financial sector in Indonesia that did not have much negative impact from the global

financial crisis. In 2010 the production of heavy equipment in Indonesia has reached 2495 units that was dramatically increased compared to 2009 due to overall production in 2009 was only up to 1814 units. The sales of heavy equipment until the end of this year rose 15.13 percent with an estimated sales figure reached 23 thousand units compared to 2011 as many as 19 977 unit sales. Deputy of Sales & Marketing of Kobexindo, Almuqri Sagitri Putra said the increase was triggered from the surge of mining activities. "Rising demand for heavy equipment and industry, along with the increase in coal prices," said Almuqri cited in his written statement. In addition to mining, the bright prospect of heavy equipment in Indonesia could not be separated from government policy in the energy sector, infrastructure and plantations. This is supported by strong economic climate with a steady economic growth assumption. "It's encouraging the surge of demand for heavy equipment in the country," he said. He added that the rise in world crude oil prices could reach U.S. $ 110 was hoist the price of coal. As an impact, supporting industries in the sector, including heavy equipment is also increasing. "It certainly affects the enhancement of mining activities and so our focus," he said. Heavy equipment industry outlook is quite bright in the last five years. This can be seen from the data equipment sales nationwide. Throughout recorded 2007 sales of just 7038 units and grew rapidly in 2008 reaching 9684 units. Had declined in 2009 amounted to 6777 units, but sales of heavy equipment again increased to 12 460 units. Coal Mining Association data said, in 2011, from the coal production of 327 million tons of export demand served by 255 million tons, and the remaining 72 million tons to fulfill the domestic demand. In 2012, coal production is targeted to be 347 million tons. Of the total amount, exports estimated at 266 million tons, while domestic about 81 million tons. The mining future Indonesia is endowed with a wide range of key minerals. It is the world's second largest producer of tin and nickel and the fourth largest copper producer. The country also produces significant quantities of gold, bauxite, phosphates and iron sand, and has the potential for alluvial diamond production. The mining industry accounted for 10.8% of Indonesia's GDP in 2009, with minerals and related products contributing one-fifth of the country's total exports. Indonesia's mining industry looks set to post strong average annual double-digit growth of 11.2% in real terms over the forecast period to reach US$149.8bn in 2015, as weak growth in tin and nickel output should be offset by robust growth in copper, coal and gold production. Going into 2011, we expect to see two

pertinent themes: the continued influx of foreign investment and the depletion of onshore reserves. Geologically, Indonesia is blessed with mineral resources. However, even a country with vast reserves will not have a robust and healthy mining industry if government doesnt support it properly. Therefore, efforts to attract foreign investors in the mining sector must be supported by good governance, a stable economic system, and political and legal certainty. Multiplier effects of the mining industry include the development of basic infrastructure, increase in regional revenue, job opportunities, and improvement of employment skills, development of supporting activities, and community development in cooperation with the regional government. The value of the mining industry is projected to grow at a steady pace of10-11% y-o-y in real terms between 2010-2014 to reach an estimated US$123 billion at the end of the forecast period. The export of ores and minerals increased from US$3.2 billion in 2000 to US$7.2 billion in 2005an annual increase of 18 percent. In 2005, the amount of exports was still slightly higher than Indias, despite Indias annual export growth of about 41 percent during the same period. The copper project developed during the nineties has doubled Indonesian copper production in 5 years. As a result, these projects have propelled Indonesia from 5th to the 3rd largest world copper mine producer. Coal production growth in Indonesian is forecasted to continue through the year 2010. Slowing demand from the international market may be offset by the increasing demand from the domestic market. Within the global context, Indonesia is one of the major mineral producers and exports numerous commodities around the world. Mining production growth is relatively high. At the last ten years the average growth production are coal 15%, copper15%, gold 15%, nickel 9% and tin 7.5%. Export demand relatively higher than domestic demand. For instance, export demand to total production are coal 75%, tin 87.5%, gold 87.5%, silver 80%, tin 96.5% and nickel 100%.Within the year 2007-2015 domestic coal demand will increase significantly, mainly due to the crash program of coal power plant development. Foreign mining companies have become valuable strategic partners for Indonesias mining industry. In addition to equity, financing and investment, foreign miners bring a combination of new technology, global marketing advantages and experience from other significant mining regions around the world. Over the five year period, foreign shareholders have contributed a significant portion of the financing requirements for Indonesian mining projects, and represent a large proportion of new investment and

development. It is expected that Indonesian mine production will continue to increase, as existing mines maximize their operations. The current situations of Indonesian mining resources are: Coal resources estimated around 61.3 billion tons with mine able reserve approximately 6.9 billion tons (15th rank of world coal reserve) Gold resources estimated around 6,369 tons with mine able reserve approximately 3,254 tons (7th rank of world gold reserve) Copper resources estimated around 68.11 million tons with mine able reserve approximately 31.85 million tons (7th rank of world copper reserve) Tin resources estimated around 0.622 million tons with mine able reserve approximately 0.462 million tons (5th rank of world tin reserve) Nickel ore resources estimated around 1,412 million tons with mine able reserve approximately 485.33 million tons (8th rank of world nickel reserve) Compared with other countries of Asia from Kazakhstan to Philippines, Indonesia is still a leader in copper, gold, silver, nickel and coal resources and production Whilst satisfying the demand to increase the role of the energy and mineral sectors to support the national economy, the government will also remain committed to protecting the environment through the passing and implementation of appropriate laws and regulations. A number of environmental issues need to be seriously managed, and these include good mining practices, post mine land use, and regional and community developments. The community development program in particular, should be clearly defined by each operating company in cooperation with central and local governments and local community. It will play an important role in supporting the poverty alleviation program which currently is part of the governments national strategic agenda.

The infrastructure needs There is also a substantial need in the infrastructure sector, considering the predicate of Indonesia as one of the developing country. As stated by the ministry of public works, the concentration of heavy equipment to support the infrastructure still dominated in the western part of Indonesia with two hundred and ten thousand heavy equipments off all types. Therefore the second trade show of heavy equipments and mining was held on

the second until the fifth of May this year. The purpose of this trade show is to promote the potential market of heavy equipment industries not only for the local but also international, in order to establish an investment especially in the eastern part of Indonesia quickly and accurately. The acceleration of infrastructure growth of Indonesia in the couple of years in the future is not a secret anymore. Through the MP3EI (Acceleration and Expansion of Indonesia Economic Development), the need of the development funds reach 1.923 trillion until 2004. The large amount of the need is to increase the growth of the economy from 5.5 percent to 5.6 percent in the year of 2010 becoming 7.0 percent to 7.7 percent in the year of 2014. Similar with the program, the budgeting for the ministry of public works is also increased dramatically from year to year. Its proved by the year of 2012 on the APBN, the budget changes of the ministry becoming 75.146 trillion or increasing 29.65 percent compared with the previous budget of 57.96 trillion on the year of 2011. The rise of the calculation also needs an endorsement from the construction resources as well as the availability of material and heavy equipments. But yet the increasing numbers is still not being evaluated. In this regard, on the fourth of May a seminar about material market opportunities and construction equipment was held to support the implementation of national infrastructure. The national infrastructure was divided into three major lines which are : the Sunda strait bridge, Jakarta mass rapid transportation and the green high rise building construction. Moreover, the seminar was also launched the information system of the investment resources (SISDI) concerning the market construction which was financed by APBN, APBD, BUMN, private corporation and the foreign construction market. This information has the potential to be accessed by the service provider in Indonesia as well as the information source of the construction equipment material resources. Meanwhile, the Messe Munchen International (MMI) managing director CEO for the Asia Pacific, Ronald Unterburger said this trade show is a part of the infrastructure initiative of MMI, because they convinced that this international exhibition give a great advantage for the infrastructure growth in many developing countries This exhibition was using an area more than 15 acres of the Jakarta International Expo, Kemayoran with the participation from Australia, China, German, Korea and Singapore.


In this observation writer was using the internet information and also the oral information from a few people that experienced in the mining field industry and heavy equipment industry. Also from the internship the writer did for six months.

THE RESULT IV.1 The Result

As we seen from the data above Indonesia still kept its best resources for the future, many of our islands that havent get the attention to be explored. The development of the resources still hasnt reached its peak yet and heavy equipment still has the important role in this situation. In addition to that the heavy equipment industry also needed for the development of construction, the infrastructure is still much needed for many years in the future. In this time the construction development is still dominated in the western part of Indonesia. The decision to develop the technology is still a question.

CONCLUSION V.1 Conclusion

Indonesia as one of the many developing countries still depend it selves to the foreign technology, the main problem is we really never wanted to learn the knowledge to develop our own technology, through these many years since the international world lay down their heavy equipments in our land we never have the passion of learning it. We never utilize the prospect heavy equipment in Indonesia. In the material sector our

country still has a large stock of metal resource thats needed to produce heavy equipment such as iron and cooper. To anticipate this situation, the government should make a policy to develop the need of the local technology. If we can use the local technology and material resources, we can be really dependant and also decreasing the cost of manufacturing and this is the breakthrough to our economical and finance problem, the profit can be used to fight the poverty and unemployment that have been an unresolved matter for decades.



The paper is written to fulfill the partial requirement to obtain final score of Bahasa Inggris II