Identification of Economic Potential in Berau Regency, East Kalimantan-Indonesia

Abstract

The primary objective of this study is to investigate the economic prospects of Berau Regency in East Kalimantan. This study aims to identify potential areas for further economic development in Berau Regency, to increase the wealth of its citizens. Additionally, it will highlight areas that need to be strengthened to achieve this objective. This study utilized shift share, the location quotient (LQ), and the growth ratio model (GRM) as analytical methods. The main data utilized in this study consisted of the Gross Regional Domestic Product (GRDP) statistics for East Kalimantan Province and Berau Regency from 2018 to 2022. The GRM study indicated that the transportation and warehousing sector experienced significant development, along with education services, health services, social activities, and other services. On the other hand, the Shift-Share analysis demonstrated positive growth in nearly all sectors within Berau Regency. Based on Location Quotients (LQ) analysis, the most competitive industries in the region include mining and quarrying, agriculture, forestry, and fisheries; wholesale and retail trade; car and motorcycle repair; transportation and warehousing; accommodation, food, and beverage provision; educational services; health services and social activities; and other services. This study emphasizes the ability of Berau Regency to effectively utilize its natural resources, particularly in the growing agricultural and tourism sectors. Hence, to advance and stimulate the tourism sector, the Berau Regency administration should contemplate allocating funds for agricultural and tourism development in its regional budget and executing infrastructure improvements. This approach is anticipated to bolster the economic development of Berau Regency while enhancing its residents’ overall quality of life.