Impact of ICT on Export Indonesia’s Specialization Products: Gravity Model Approach

This study aims to investigate the impact of Information and Communication Technology (ICT) on the export growth of Indonesia's leading specialized products. A sample of this study was selected by identifying every commodity that holds more than a 25% share in the international market. The five specialized products also represent Indonesia's leading sectors, which include the manufacturing industry (palm oil, HS Code: 151190, and coconut oil, HS Code: 151319), agricultural products (rubber, HS Code: 400122), and natural resources (coal, HS Code: 270119, and tin, HS Code: 800110). The analytical model was tested on Indonesia's leading products in 15 importing countries during the 2010-2020 period and estimated using PPML and GMM as a robustness test. The ICT variable was proxied by bandwidth capacity, which represents the quality of internet access, both in Indonesia as an exporting country and in importing countries for Indonesia's leading products. The results of the analysis indicate that the quality of internet access has a positive impact on export growth. Additionally, other control variables, such as GDP, population, RTA, language, and importers from Asia, also have a positive impact on the export growth of Indonesia's leading commodities. It can be concluded that Indonesia’s export pattern remains concentrated in Asia's partner countries, driven by economies of scale and hindered by geographical distance. This study suggests that the development of ICT is typically a long-term process, so it takes some time to experience the significant impact of ICT, especially on exports.