Economic growth is an increase of the amount of goods and
services the whole economy produce over and above what is produced last year.
It also means an increase in output, demand, and income in a country. Every positive
increase that the country produces can be concluded as economic growth.
Economic growth can be measured in multiple ways, the most important being GDP
per capita. GDP per capita measures the income earned per person in a country
and an increase in GDP per capita means that more people have more income to
spend on. There’s also the level of education a country has, by measuring the
number of schools and number of graduates in a country, and also literacy rate.
Last but not least, the living standards of a country. And this report is made
to explain about the importance of Morin company in the economic growth of
Indonesia.
I’ll start with an introduction first. Morin is an
Indonesian jam company located in Cikarang under PT. Astaguna Wisesa. It is the
biggest jam company in Indonesia, and is currently the leader of the market, with
them holding around 50% of market shares. And even though they have many
competitors, when we compare the overall results, they still managed to be the
best and even trying to go international and make Indonesian jam to be known.
And as one of the biggest jam company producer, they help economic growth in
many ways.
First, they create job for many people. In developed countries, factories use
machinaries to do everything from the producing to packing, but Indonesia is a
large country with high population growth and big population. We have to use
resources to their fullest, so we need to hire employees. Employees in
Indonesia aren’t as costly as it is in other countries. According to recent
news, the minimum wage in Indonesia is 1 million IDR up to 2 million IDR a
month, while the average wage per hour for employees outside the country costs
$10-$20 an hour. And since the country has high unemployment level, Morin
chooses to be one of the companies that uses labour-intensive method, judging
by how they’re still employing many people for small tasks such as packing,
when it can be done by advanced technology these days such as Teh Pucuk Harum
who chooses to be more capital-intensive by using machines for every process.
Even though it is not efficient enough and more mistakes will be made, it decreases
unemployment and brings economic growth.
Morin is a financial-reward company that seeks for profit and getting more
investments. They produce products to sell for families to eat in the morning
and provide jams for flavoring of foods such as bread and ice cream. It
generates profit everyday, but this does not mean all their needs are fulfilled.
And as the company wants more income, they will advertise more and expand their
market. Investors from other countries see this opportunity to invest seeing
them being profitable, and if they’re set on investing, they will make
investments in the company, bringing economic growth. However they might become
too monopolizing, making the market for themselves with the help from overseas
investors.
Morin made its international debut not a long time ago. The brand recognition
outside the country is still poor, and as jams are produced originally from
Europe, most people know Indonesia only for our spices. When it comes to jam,
they will prefer European made ones and would wager over Morin’s. This is one
of the barriers holding the product, however lately Morin has been promoting a
lot and selling it over countries in Asia. More countries are now aware of
Morin’s existence and their jam. This brings more recognition for Indonesia and
connections between countries shall increase, expanding their imports exports
field, in other word, increases international trade.
They also produce Carrefour’s original jam and some other jams, the difference
is in the composition of the product and the label but produced in their
factory. This means there are more competitors, which is a threat to them, but
then it means that the market expands with more companies, and this can create
a bigger rivalry between every company to make their brand the best, which
means in bigger productivity. But this causes resources being used up so they
have to use it efficiently.
By seeing all the things from above, we can conclude that they help the
economic growth by factors such as reducing unemployment, helping economic
growth, balance of payments, and increase in international trade. They do bring
inflation problems, scarce of resources, and monopoly in the market, but
problems can be covered if there’s a good control in economy that will keep the
economic growth for the country kept controlled.
