Media Wahyu Askar
This article critically examines the effectiveness of foreign aid in fostering economic development in Indonesia. Askar contends that while foreign aid can provide short-term relief and infrastructure investment, it often leads to long-term debt dependency and undermines domestic fiscal discipline. The paper argues that Indonesia’s development challenges stem not from capital scarcity but from governance failures, corruption, and inefficiency in public policy formulation.
Drawing on the debt-overhang hypothesis, the author advocates for debt relief as a means to restore economic efficiency and fiscal sustainability. The study concludes that aid effectiveness depends heavily on the quality of institutions and the accountability of government spending. Improving governance and reducing reliance on external borrowing are essential steps toward achieving sustainable development in Indonesia.
Reference:
Askar, M. W. (2015). Foreign aid and economic development in Indonesia. Jurnal Ilmiah Administrasi Publik (JIAP, 1(2), 14–18.
Link:
https://www.neliti.com/publications/81015/foreign-aid-and-economic-development-in-indonesia