The findings matter because North Lombok continues to face persistent structural challenges, including high poverty rates, limited infrastructure, and low human capital. By pinpointing sectors with measurable economic strength and growth potential, the research offers a practical pathway for reducing regional inequality and improving living standards.
A Region Facing Complex Development Pressures
North Lombok’s classification as a disadvantaged region is not without reason. The area has struggled with multiple overlapping issues, from economic vulnerability to environmental risks. Poverty levels remain higher than the provincial average, and access to education and healthcare services is still limited.
At the same time, the region’s dependence on central government funding highlights weak local revenue generation. These conditions make it essential to identify sectors that can independently stimulate economic activity and create sustainable income sources for local communities.
Simple but Comprehensive Data Analysis
To uncover the most promising sectors, Amilatus Nafisah and Mohammad Wahed analyzed regional economic data from Indonesia’s Central Statistics Agency (BPS) spanning 2018 to 2023.
The researchers combined several analytical tools to ensure a well-rounded evaluation:
- Comparative analysis to identify dominant sectors
- Growth trend analysis to measure future potential
- Competitiveness assessment to evaluate sector performance
- Economic impact analysis to understand broader contributions
This layered approach provides a clearer picture of which sectors are not only strong today but also capable of sustaining long-term growth.
Three Sectors Lead the Way
The study highlights three sectors that stand out as the most influential in driving economic development:
- Electricity and gas supply, which supports productivity across industries
- Water supply and waste management, which ensures environmental sustainability and public health
- Other services, including tourism and community-based economic activities
These sectors were consistently identified as leading across multiple analytical frameworks, indicating both strength and strategic importance.
Data presented in the study—particularly in the sectoral comparison tables—also show that while agriculture and trade remain important, their long-term competitiveness is less consistent compared to the three leading sectors .
Tourism and Services Create Direct Economic Impact
Among the three sectors, the service sector emerges as the most impactful for local communities. This category includes tourism, small businesses, and personal services, all of which directly generate income and employment.
The growth of tourism in areas such as the Gili Islands has significantly boosted local economic activity. Increased visitor numbers have created demand for accommodation, food services, transportation, and local products.
As noted by Amilatus Nafisah, the service sector is particularly valuable because it connects directly with the community, allowing economic benefits to spread quickly at the grassroots level. This makes it a key driver of inclusive development.
Infrastructure Sectors Provide the Foundation
While the service sector generates immediate economic benefits, infrastructure-related sectors such as electricity, gas, and water play a critical supporting role.
These sectors:
- Enable businesses to operate efficiently
- Improve quality of life through better public services
- Attract investment by creating a stable economic environment
The research shows that these sectors are classified as “leading” in terms of development potential, even though their direct economic impact may appear smaller.
Growth Without Strong Spillover Effects
One of the study’s most important insights is that strong sectors do not always produce widespread economic benefits. The analysis of multiplier effects reveals that most sectors in North Lombok have relatively low spillover impact.
Multiplier values range from 1.00 to 1.55, indicating that increases in sectoral output often result in limited additional economic activity. For example, the electricity and water sectors show minimal indirect impact on other industries .
This suggests that economic growth in North Lombok is still fragmented, with weak connections between sectors.
Policy Directions for Stronger Economic Integration
The study emphasizes that identifying leading sectors is only the first step. To maximize their impact, policymakers need to strengthen connections between sectors and ensure that economic benefits circulate within the region.
Key recommendations include:
- Developing stronger supply chains between local industries
- Encouraging local content and reducing dependence on external inputs
- Expanding tourism-based economic programs
- Improving infrastructure to support business growth
Mohammad Wahed highlights that without stronger integration, even high-performing sectors may fail to deliver long-term, sustainable benefits.
A Strategic Path Toward Inclusive Growth
The research underscores a critical point: economic development in underdeveloped regions requires both strong sectors and effective policy coordination. In North Lombok, the combination of service-based industries and infrastructure development creates a foundation for future growth.
However, the success of this strategy depends on how well these sectors are connected and how effectively local resources are utilized.
As the authors from Universitas Pembangunan Nasional “Veteran” Jawa Timur suggest, a balanced approach—combining community-driven services with infrastructure investment—offers the most realistic path toward reducing inequality and achieving sustainable development.
Author Profile
Amilatus Nafisah is a researcher specializing in regional and development economics at Universitas Pembangunan Nasional “Veteran” Jawa Timur. Her work focuses on economic strategies for disadvantaged regions.
Mohammad Wahed is a lecturer and researcher in regional economics and public policy, with expertise in economic development and sectoral analysis.
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