CRITICAL OUTLOOK AT SPECIAL ECONOMIC ZONE IN ASIA: A COMPARISON BETWEEN INDONESIA, MALAYSIA, THAILAND AND CHINA

Abstract

Special Economic Zones (SEZ) have been proven to help countries in fostering economic
growth. The aim of this research is to try to help the government to improve SEZ policies in
Indonesia by providing a benchmark with other SEZ countries in China, Malaysia, and
Thailand. While China has the most established SEZ program, Malaysia and Thailand also
have highly-regarded SEZs and investment incentives. These neighboring countries have
developed SEZs in significant quantities but the greatest returns have come from a subsection of
large-scale zones with favorable locations, good planning and access to resources. Thailand
has a smaller number of zones, but a higher rate of successful zones, such as the automobile
cluster which became the anchor of automotive production in Asia. How Indonesia’s position
compares to these three Asian countries is the main question of this study.
Keywords: special economic zone, foreign investment, benchmarking, competitiveness, China,
Malaysia, Thailand