Study on Comparative Advantage of Mining Sector in South Sulawesi Province, Indonesia

Abstract

Mining sector is an important sector that contributes to regional development therefore, it has to be managed sustainably. This became basis of this study. Problem examined was comparative advantage of  mining toward South Sulawesi. This study used multidimensional scaling and input-output analysis. Those analyses used input-output table data of 2010 in classification of 11 economic sectors and GDRP of 24 districts/cities of South Sulawesi in 2012-2016 which was obtained from BPS (Central Bureau of Statistics) South Sulawesi. Results showed that final value of the mining sector in South Sulawesi was Rp9,007,814,000,000, describing role of mining sector as relatively small compared to other sectors. Shift share described economic growth of mining sector in Luwu Timur was faster than other districts. Export base (LQ) and shift share ere indicators that showed that Luwu Timur was superior to other districts. LQ value from Luwu Timur was 9.39 indicating that mining sector was self-sufficient and able to fulfill its need from its own production. Multidimensional scaling analysis in perceptual map showed that the mining sector in East Luwu had comparative advantage based on LQ and shift share. Perceptual Map showed that Luwu Timur was the district that held the largest role in mining sector in economy of South Sulawesi when compared to other. This role was due to existence of the operated largest nickel laterite mining company in Indonesia.