Social Innovation and its Impact in Indonesia

Throughout our history, social innovations have played a central role in our technological transformation. This change is especially evident in the 4th most populous nation in the world, Indonesia.

With a population of 250 million, Indonesia is rated as an emerging middle-income country. The Indonesian economy is the 10th largest in the world and the poverty rate has been slashed by more than half to 10.9% in 2016. Despite its achievements, Indonesia still faces a barrage of social challenges. One of it lies in its cities, where urban population growth is threatening to derail its progress.

Social innovations are playing a transformational role in Indonesia by creating smart cities, resolving future energy concerns and bringing access to financial services for its residents. By working together with the Indonesian policymakers, Hitachi looks to co-create a brighter future for Indonesia.

Indonesia is home to

261

million people

Indonesia’s economy is

10 _TH

Largest in the world

Indonesia’s GDP per capita is

US$13,120

In terms of PPP

How Hitachi Co-Creates a Brighter Future for Indonesia

Hitachi has developed an Intelligent Video Analysis System using image-analysis technology with AI to focus on improving public safety in Jakarta growing concerns of complex security threats Read More

In 2016, in partnership with Sky Energy, we became the largest solar panel producer in Indonesia, with a production capcacity of 100 MW for the foreseeable future on Indonesia’s energy demands
Read More

Since 2011, Hitachi has helped with financial inclusion by supplying ATMs to the leading commercial bank and assisting with the nation’s first cash recycling operations
Read More

Accommodating for Rapid Urbanisation in the Cities

The rapid growth of the urban population in Indonesia’s cities in recent years is threatening to derail the nation’s economic progress

JAKARTA

Jakarta was meant to house 800 K people when it was founded

Jakarta is now home to about 12 M people during a typical work week

68_%

of Indonesia’s population will live in urban cities in the next 10 years

Jakarta is adopting smart technologies to improve public security as a counter to threats such as terrorist attacks

To overcome this, Hitachi has created an Intelligent Video Analysis System using image-analysis technology with AI. It enables real-time people-detection and tracking using a combination of over 100 features of the person of interest.

In addition, Hitachi is augmenting elevator and escalator solutions with security and AI enhancements. These systems are instrumental to urban areas and help to facilitate human traffic flow in heavily populated cities.

Find out more about Hitachi's development of image-analysis technology with AI

Developing the Renewables Energy Sector

High rates of urbanisation growth also place a heavy toll on Indonesia’s energy demands. The Indonesian government is turning to renewable sources for energy consumption for the foreseeable future

Energy consumption has spiked by 4.2_% over the last 15 years

Indonesia is facing an energy crisis by 2020 – 2030 as it runs out of fossil fuels to meet its electricity demands

In 2015, President Widodo vowed to reach a target of 23_% renewable energy by 2025

The government aims to build solar power generations capable of producing 5,000 MW by 2019

Established in 2008, initially as a solar panel distributor, Sky Energy teamed up with Hitachi High-Technologies Indonesia in 2009 to build manufacturing facilities and started producing solar panels in 2012.

In 2016, it claimed to be the biggest solar panel producer in the country with a production capacity of 100 MW, as well as having 50 MW production capacity for solar cells.

On top of that, Hitachi is collaborating with Prasetiya Mulya University for education and research activities in engineering and energy sciences. This is a continuation of Hitachi’s efforts in supporting the Indonesian energy sector since 1995, beginning our early investments in High Voltage Switchgear Fabrication in Cikarang.

Reaching Out to the Underbanked Population

Outside of the major cities in Indonesia lies a large population of Indonesians who are excluded from the financial services system. To them, cash is the preferred transaction mode and they rely heavily on informal and non-full service institutions. Adults, especially those living below the poverty line and in rural areas, save in small amounts at home and typically access loans in cash from friends and relatives.

In 2014, only 36% of Indonesian adults owned a bank account

33% of the unbanked population cited distance as a key reason for not owning a bank account

ATM deployment proved vital in Indonesia, with more than 100,000 machines in the country in 2016

A 2018 report reveals that around half of the adults in Indonesia now own a bank account

To help, Hitachi has supplied ATMs and related services in Indonesia through its collaboration with local distributors since 2003. It shipped a large volume of cash recycling ATMs to the leading commercial bank in 2011 and assisted with the nation’s first cash recycling operations in 2013.

A 2018 report reveals that around half of the adults in Indonesia now own a bank account, reflecting a turning point in the country’s journey to boost financial inclusion. Bank Indonesia and the central government of Indonesia target to raise the financial inclusion figure to 75% by 2019.

Date of Release: October 2018