ISSN : 2302 - 1590 E-ISSN: 2460 – 190X ECONOMICA Jurnal Program Studi Pendidikan Ekonomi STKIP PGRI Sumatera Barat Vol.9 No.2 (182 – 197)

LEADING SECTOR ANALYSIS IN IMPROVING ECONOMIC GROWTH

By Prince Charles Heston Runtunuwu1), Amran Husen2) 1) Faculty of Economics and Business, Khairun University, Email : [email protected] 2) Faculty of Economics and Business, Khairun University, Indonesia Email : [email protected] Submitted: 2020.12.05 Reviewed: 2021.04.08 Accepted: 2021.04.30 https://doi.org/10.22202/economica.2021.v9.i2.4547

Abstract Leading Sectors in Order to Increase Economic Growth in South Regency. The aim of this research is to identify the leading sectors in order to increase the economic growth of . The analysis was carried out using the Location Quotient and Klassen Typology methods. The results shows, the location quotient analysis, there are 13 leading sectors, namely agriculture, forestry and fisheries, mining and quarrying, processing industry, electricity and gas procurement, water supply, waste management, waste and recycling, construction sector. , the wholesale and retail trade sector; car and motorcycle repair, the transportation and warehousing sector, the financial services sector and insurance, the real estate sector, the education services sector, and the health services and social activities sector, and the last sector, namely the other service sector. and analysis of typology classifications, there are three categories, namely the electricity and gas procurement sector, the water supply sector, waste management, waste and recycling, the accommodation and food and beverage provision sector, the real estate sector, the corporate services sector and the other services sector. is a sector that is classified as a developed and rapidly growing sector, while the information and communication sector, the financial services and insurance sector, the health services sector and social activities, the construction sector, and the education services sector are in the category of potential or can still develop. and the government administration, defense and compulsory social security sector, the wholesale and retail trade sector; car and motorcycle repair, the manufacturing sector, and the agriculture, forestry and fisheries sectors of these four sectors are in the relatively underdeveloped sector category.

Jel Clasification: R53; F43 Keywords: Location Quotient, Klassen Typology, Economic Growth

©2021 Prodi Pendidikan Ekonomi STKIP PGRI, Padang

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INTRODUCTION success of economic development. Theory is Economic development cannot be built on empirical experience, so that theory separated from economic growth, economic can be used as a basis for predicting and development encourages economic growth making a policy. and conversely economic growth facilitates Development is an activity process that the process of regional development. The is considered important and mandatory for all existence of economic development that is countries, because globalization, not well planned will result in environmental accompanied by technological advances and damage. Therefore, through economic scientific developments, has an impact on development it is possible to change the change and renewal in all aspects of human economic structure from an agrarian life (Pereira, 2015). Regional economic economic structure to an industrial economic development is a process in which local structure so that the economic activities governments and communities manage carried out by the state will be more diverse existing resources and then form a and dynamic. Development in developing partnership pattern between local countries is more focused on economic governments and the private sector to create development, this is due to economic new jobs and stimulate the development of backwardness. Development in the economic economic growth in the region. sector can support the achievement of goals According to Schwarz (2014) The or encourage changes or reforms in other economic development of a region can be areas of life (Mangilaleng, 2015). measured through economic growth that at Furthermore, according to Saputri the same time the indicator gives an idea of (2018)Economic development is aimed at the extent of activisme local economic as a creating high economic growth and being certain period has generated revenue for the able to eliminate or reduce poverty and community as indicated by the increase in income inequality. These two goals, not all income per capita. Regional economic countries, especially developing countries, growth is basically influenced by the are able to achieve these goals excellence comparatif an area, area of simultaneously. The problem that a specialization, as well as the economic developing country will face is to achieve the potential of the area owned. Therefore, the highest possible growth by reducing equity utilization and development of all economic or prioritizing equity with growth that is not potential is a top priority that must be too high. However, the fact shows that most explored and developed in implementing developing countries prefer the first goal sustainable regional economic development. ofachieving growth by delaying equity. This Furthermore, according to Basori is because the higher the economic growth, (2017) in regional economic development, the easier it is to achieve the objective of the role of local government is very equal distribution, even the equitable important for regional economic distribution of economic growth by itself is a development. When local governments carry trickle down effect. out economic development planning in the According toSukirno (2000)Economic regions, local governments are required to be growth is the development of activities in the able to manage all potential resources in their economy that causes goods and services regions, both from natural and human produced in society to increase and the resources properly and in accordance with welfare of society to increase. So that Law No. 32 of 2004 concerning the authority economic growth can also be interpreted as a of local governments. to build the area. With process of increasing the production capacity the enactment of this law, it is hoped that the of an economy which is manifested in the implementation of regional economic form of an increase in national income. Their development can run well and according to economic growth is an indication of the plan.

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According to Amalia (2012) used to determine the success of the Development planning can be said to be development that has been achieved, it can synonymous with development economics. also be used to determine the direction of If the room for the development economy future development. tries to find a development strategy, The leading sector is a sector, one of development planning is a powerful tool for which is influenced by the existence of the translating this development strategy into award endowment factors. Furthermore, this various coordinated program activities. This factor develops further through investment coordination needs to be done so that the activities and becomes the basis of economic targets, both economic and social, which activity. The criteria for leading sectors will have been previously set, can be achieved vary widely. Sambodo in Usya (2006) more efficiently. In this way, it will be emphasizes that this is based on how big the possible to avoid excessive spending in the role of the sector is in the regional economy, implementation of development. Regional including: first, the leading sector has a high development must be in accordance with the growth rate; second, the sector has a potential conditions and aspirations of the relatively large labor absorption rate; third, growing and developing community. If the has high inter sectoral linkages both forward implementation of regional development and backward; fourth, it can also be priorities is not in accordance with the interpreted as a sector capable of creating potential of each region, the utilization of high added value. existing resources will be less than optimal. According toSudarti (2009)efforts in This situation may result in a slow process of regional development, aspects that have economic growth in the region concerned. economic potential will be taken to be Yulianita (2010) emphasized that one developed. Literally, economic potential in of the objectives of development is to the framework of regional development can increase economic growth, with high be interpreted as the ability of strength and economic growth the benefits of the wider ability in the economic field possessed by a community will be felt. An important region to develop its respective regions. The indicator to determine the economic economic potential can be in the form of condition of a region or region in a certain natural resources, human resources, period is shown by Gross Regional Domestic geographical location of the area which is Product (GRDP) data. And to see the growth close to facilities and infrastructure as well as seen from the Gross Regional Domestic other supports. Product (GRDP) at the constant price of the Furthermore, according to BPS (2019) region or region. Economic growth is an South Halmahera Regency is a City District important indicator in analyzing the of North Province which in 2016 had economic development that occurs in a economic growth reaching 5.69%, while the country. Economic growth shows the extent national economic growth reached 5.02%.in to which economic activity will generate 2016. The data from BPS shows that the additional public income in a certain period. growth of South Halmahera Regency is In addition, economic growth analysis can be higher than the national economic growth.

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Table 1. GRDP of Province at Constant Prices 2010 According to City Regencies 2013-2017 in Units (Billion Rupiah) No Name of Regency / Year City 2013 2014 2015 2016 2017 1 City Ternate4,5 4,956 5,357 5,785 6,224 57 2 North Halmahera 2,833 3,027 3 , 22 3.35 3,574 3 South Halmahera 2,728 2,909 3,064 3,239 3,762 4 East Halmahera 1,862 1,682 1,785 1,883 2,022 5 Islands 1,423 1,511 1,603 1,687 1.79 6 Sula Islands 1,182 1,254 1,328 1,396 1,465 7 West Halmahera 1,12 1,18 1,246 1.31 1,377 8 Central Halmahera 1,108 1,087 1,134 1,262 1,337 9 Morotai 729 774 821 873 929 10 Taliabu Islands 650 688 727 768 811 Source: BPS, 2020

From the PDRB data of North Maluku South Halmahera Regency has natural province based on constant 2010 prices wealth and natural resources that have great according to city districts (billion rupiah) in potential to be developed. Moreover, the 2013-2017, it shows that South Halmahera richness ofthe sea is so abundant and the Regency is in the 3rd position experiencing beauty of the underwater there is still increased economic growth throughout maintained, with the characteristics of such North Maluku Province in 2013-2016 waters. The potential for developing natural meanwhile in 2017, South Halmahera resources can be increased for the welfare of Regency increased considerably to rank the people of South Halmahera Regency. All second in North Maluku Province and efforts made by the Government to maximize City in first place. In addition, South all the potential of the region have gone well. Halmahera Regency in 2013-2017 its The government seeks to optimize the use of economic growth always increased and did inputs and improve economic processes. not experience a decline.

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Source : BPS, 2020

Figure 1. Graph of Growth Rate of South Halmahera Regency at Constant Prices for 2010, 2013-2018 in Figures (%)

From the graph shows that South determine the same leading sectors based on Halmahera Regency in 2013-2018 themethod Klassen Typology, Location experienced economic fluctuations and in Quotient, Shift-Share,Ratio Model 2016-2017 economic growth jumped far Growthand Overlay, which show that the from 5.69% to 12.17% while in 2017-2018 it same leading sectors based on these 5 experienced a decline from 16, 17% down to methods in Blitar City are 1) Wholesaler and 15.38%. From national data to regional data. Retailer; Car and Motorcycle Repair, 2) This leads researchers to further find out Information and Communication, and 3) which sectors have contributed greatly to Financial and Insurance Services. This study economic growth in South Halmahera is the basis for conducting further research on Regency. how the potential of leading sectors to The government's efforts in optimizing economic growth. the use of inputs and improving economic Based on the background above, a processes are proof that the South Halmahera focus problem can be formulated, namely Regency Government is able to manage its what sectors are the leading and non-superior own territorial wealth and strive to create sectors in the economy, as well as what better economic growth. Various ways from sectors provide the rate of economic growth all social elements of the community and in South Halmahera Regency. For this local government, it is hoped that reason, this study aims to identify and development, regional especially South identify the leading and non-superior sectors Halmahera Regency, can be better. In order in the economy of South Halmahera to develop regional potential, namely by Regency, and to find out which sectors analyzing the leading sectors in order to contribute to the growth rate of South increase the growth economic of South Halmahera Regency. Halmahera Regency. Satrianto and Sasongko study (2019), RESEARCH METHODS regarding the determination of the same This research was conducted in South leading sectors in Blitar City, which aims to Halmahera Regency, in May-June 2020.

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N Types and sources of research data are P I: PDRB of North Maluku Province important factors that become considerations Sector i that determine the secondary data collection If LQ> 1 then it can be interpreted method that is time series in annual form that sector i which is South Halmahera from 2013-2019 on regional domestic regency is a leading sector capable of products. gross based on constant prices in exporting to other regions or supplying to 2010. As for obtained from the agency in other regions. If LQ <1, it means that sector i question is the Central Statistics Agency in South Halmahera Regency is not a (BPS) of North Maluku Province and the superior or basic sector. If LQ = 1 then the regional library agency of South Halmahera sector only fills the region itself. Regency. Analysis Typology Klassen The method of collecting data and Based on the Matrix, an economic information in this study uses the method of sector can be classified into advanced, collecting data and information by reading, advanced but depressed, developing, and understanding and studying books published relatively under developed sectors. This by the South Halmahera Regency analysis bases the grouping of a sector on the Government, BPS agencies, articles, growth and contribution of the sector to total journals, and books that have relevance to the regional GRDP (Widianingsih 2015). issues raised. in this research, which is 1. Classification I: Fast Forward and Fast- obtained through libraries and the internet. Growing Sector. To find out information on what 2. Classification II: Forward But sectors are included in the leading sectors, Depressed sector. the analysis method used is sector 3. Classification III: Fast Developing contribution analysis, growth rate analysis, sector. Location Quotient analysis and analysis 4. Classification IV: Relatively Klassen Typology. Underdeveloped Sector. This study uses themodel location Location Quotient (LQ) Analysis Techniques quotient and classification typology as an According toArsyad (1999) LQ technique analytical tool in which the LQ analysis can divide the economic activities of a region measures sectors that fall into the and non- into two groups, namely: categories, while theanalysis basic typology 1. Industrial activities that serve the market classen measures the classification of sectors in the area itself and outside the region that fall into four categories. concerned, industries like this are called This frame work research aims to base industries. identify the leading and non-superior sectors 2. Economic activities or industries that and the sectors that provide the greatest serve the market in the area, this type is competitiveness for the economy of South called non-base industries or local Halmahera Regency. The framework in this industries. To calculate LQ, a formula is study is the PDRB approach of South used. Halmahera Regency for the period 2005- 푃푅푖 / 푃푅 2019 by adding up all the total number of 퐿 푃푁푖/ 푃푁 employment and economic sectors so that it can be identified the contribution of each Where: sector to GRDP. P R: Total GRDP of South Halmahera Regency RESULTS AND DISCUSSION R P i: PDRB of South Halmahera Regency This study analyzes the influence of Sector i leading and non-leading sectors and sectors P N: Total GRDP of North Maluku Province that provide growth rates on economic growth in South Halmahera Regency. The

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Prince Charles Heston Runtunuwu data used in this study is secondary data views 9 to classify developmental sectors in using data time series or time ranges from general as a result of research on economic 2013-2019. The data analysis tool used growth in South Halmahera Regency. Microsoft Excel and application software E-

Table 2. Regional Gross Domestic Product Growth Rate of Regency / City of North Maluku Province ADHK 2010, 2013-2019 in figures (%) Region ADHK Regency / City Gross Regional Domestic Product Growth Rate 2010 (Percent) 2013 2014 2015 2016 2017 2018 2019 West 0, 0.23611111 0.25 0.21736111 5 0.223611 0.264583 Halmahera 26388889 Central 0.22847222 -1.90 0.19027778 0.475 0.26388889 0.31875 0.292361 Halmahera Sula Islands 0.25347222 0.25902778 0.26944444 0, 0.22430556 0.252083 0.272917 21597222 South 0.28125 0.29305556 0.23263889 0.25625 0.67083333 0.655556 0.501389 Halmahera North 0.21111111 0.30833333 0.27847222 0.16875 0.29305556 0.113889 0.127778 Halmahera East 0.26597222 -9.66 0.25763889 0.24305556 0.30347222 8 0.25 Halmahera Morotai 0.25347222 0.26319444 0.25902778 0.27013889 0.26458333 0.297917 0.206944 Island Island 0.84166667 0.06319444 0.79236111 0.25625 0.22916667 0.504167 0.405556 Taliabu Ternate 0.33819444 0.38611111 0.33958333 0.36041667 0.32986111 0.35 0.350694 Tidore Island 0.26597222 0.26111111 0.25694444 0.22430556 6 0.254167 0.279861 North 0.275 0.24236111 0.25694444 0.26180556 0.33819444 0.355556 0.259028 Maluku Source: BPS, 2020

From table 2 The Growth Rate of Gross economy was unstable for a period of 7 years Regional Domestic Product of Regency / from 2013 until 2019. City of North Maluku Province at Constant South Halmahera Regency has 17 Prices 2010, in percentage figures for 2013- sectors that play a role in increasing regional 2019 shows that South Halmahera Regency economic growth, and from the table above it from 2013 to 2014 has increased by can be seen that the Gross Regional Domestic 0.28125% to 0.29305556% but in Product for the period 2013 to 2019 has experienced a decrease of 0.23263889% and increased well each year, but in 2019 the increased again in 2016 to 2017 which was GRDP of South Halmahera Regency has quite significant, then decreased again in decreased which is significant around 2018 to 2019. This shows that the economic 1.301% shows the instability in the growth rate of South Halmahera Regency production of each sector. experienced economic fluctuations, the

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Table 3. Gross Regional Domestic Product Based on Constant Prices in 2010 South Halmahera Regency 2013-2019 in units (million IDR) GRDP Sector Regional Domestic Product at 2010 Constant Prices (Million Rupiah) 2013 2014 2015 2016 2017 2018 2019 Agriculture, 1035528 100461 1050778 102969 108704 106789 1112090 Forestry, and 9 0 3 3 fishery Mining and 259134 277159 267756 262658 482158 306144 709 521 Quarrying Manufacturing 273702 252424 293480 321538 712493 981004 1135865 Procurement of 50 1474 77 97 103 2662 113 Electricity and Gas Water Supply, 164 4402 195 206 214 5428 238 Waste Management, Waste and Recycling Construction 128517 148853 175533 191680 206 126190 222229219 Wholesale and 518213 456081 624701 580986 718008 665034 772 901 Retail Trade; Repair Cars and Motorcycles Transportation 74836 70014 90710 61144 and Warehousing 80940 877709483 9 Provision of 6834 308 329 8424 9145 401 411 Accommodation and Eat Drink Information and 64383 59448 Communication 71213 76305 80998 83529 87577 Financial Services 46 613 50 815 53024 59364 62527 65649 67719 and Insurance Real Estate 91 98 105 2768 2990 132 3313 Corporate Services 117 2992 3227 145 154 163 4037 Government 279076 310344 339900 360732 357142 381146 408197 Administration, Defense and Compulsory Social Security Education Services 78420 84583 91927 97673 102938 107315 113250 Health and Social 64066 57831 73188 70420 83084 77233 88 593 activities other services 13746 10295 11029 11965 12648 402 14770 GRDP 2908534 2727948 3074854 3238569

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3762391 4340354 4860181 Source : BPS, 2020

Analysis of Location Quotient (LQ)

Source : Processed Data, 2020 Figure 2. The results of the Location Qoutient analysis basic, the sector of South Halmahera Regency for the period 2013-2019

1. Base Sector car and motorcycle repair with an LQ Base sector according to index of 449,9551, the transportation Richardson is a sector that is the main and warehousing sector with an LQ determinant of a region's economic value of 1.012008, the financial growth which is directly related to the services and insurance sector with an demand for goods and services LQ value of 3,61235, the real estate outside the region. The base sector sector with an LQ value of 1.447481, has a competitive advantage which the education services sector with an forms the backbone of the regional LQ index of 4.493681, and the health economy because it can meet the services and social activities sector economic needs of its own region and with an LQ index of 3.171618, and is able to export goods outside the the last sector is the other service region. sector with an LQ value of 2.423083. In graph 2. The above shows The wholesale and retail trade, auto that South Halmahera District has 13 and motorcycle repair sectors are the basic sectors, namely the agriculture, sectors that have the largest LQ index forestry and fisheries sector with an of 13 other base sectors. average LQ index of 5.390679, the The situation above shows that mining and quarrying sector with an 13 sectors are the sectors illustrates LQ index of 4.570197, the that the sector has the economic manufacturing sector with an LQ strength is quite good and very index of 6.069635, the electricity influential on economic growth South procurement sector and gas with an Halmahera in the future as well as 13 LQ index of 17.28302, the water bases sector is able to meet the needs supply, waste management, waste of the region and even potentially and recycling sector with an LQ export out of the region. This means index of 2.290484, the construction that 13 of the basic sector is the sector sector with an LQ value of 2.078365, where the potential of this sector can the wholesale and retail trade sector; in .

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2. Non Base Sector industries less potential but serves as Non base sector are other a support. sectors that serve as supporting

Source : Processed Data, 2020 Figure 3. Graph Results of the location quotient for the non-base sector of South Halmahera Regency for the period 2013-2019

In figure 3 Above shows that the sector require imports from other regions. . As for which is a non-basic sector in South the non-based sectors of South Halmahera Halmahera Regency consists of 4 sectors, Regency, there are 4 economic sectors that namely the sector of providing require more attention, so that these sectors accommodation and food and drink, can export out of the region so as to increase transportation and warehousing, the regional income to support sustainable information and communication sector, the development. corporate services sector, and the government administration, defense and Analysis of Klassen Typology compulsory social security sector. The four South Halmahera Regency has 17 sectors in production are still unable to meet sectors, each of which has advantages and the needs in South Halmahera Regency. non-superior. As a region that has abundant Even importing out of the region. Even natural resource wealth, it cannot be denied though the base sector is the most potential that each region always wants to improve sector to be developed and to spur economic their economic sector. However, the growth in South Halmahera Regency, the advantages of certain economic sectors can non-base sector cannot be ignored because of still be analyzed using Klassen's typology so the existence of this base sector, so the non- that the direction or orientation of policies basic sector can be helped to be developed that can be carried out is in accordance with into a new base sector. the expected achievement of economic Broadly speaking, the results of the improvement. analysis Location Quotient show that South This analysis is used to classify the Halmahera Regency is a region that has so economic sectors in South Halmahera many base sectors with 13 basic economic Regency in the period 2013-2019. There are sectors, thus the base sector can fulfill its own four quadrants, using indicators of the rate of regional consumption and can export economic growth and the contribution of products outside the region so that it does not

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Prince Charles Heston Runtunuwu each sector in South Halmahera and North the Regency greater than the value of the Maluku Provinces. GDP of the Regency and the contribution of Quadrant I is an advanced and fast- certain sectors in the Regency is less than the growing sector that has a certain economic value of the contribution of certain sectors in sector growth rate in the Regency that is the Province. And Quadrant IV is a relatively greater than the value of the Regency's underdeveloped sector which has a value of GRDP economic growth rate and the the growth rate of certain economic sectors in contribution value of certain sectors in the the Regency which is smaller than the value Regency is greater than the value of the of the economic growth rate of PDRB in the contribution of certain sectors in the Regency and the contribution value of certain Province. Quadrant II is an advanced but sectors in the Regency is smaller than the depressed sector which has a value of the value of the contribution of certain sectors in growth rate of certain economic sectors in the the Province. Regency which is smaller than the value of Based on the classification of the GRDP economic growth rate of the economic sectors in South Halmahera Regency and the contribution value of certain Regency during the 2013-2019 observation sectors in the Regency is greater than the period, it shows that there are classifications value of the contribution of certain sectors in into three categories, namely advanced and the Province. Quadrant III is a potential fast-growing sectors, potential or developing sector that can still develop, which has a sectors, and relatively lagging sectors. growth rate of a certain economic sector in

Table 4. Results of analysis Klassen Typology, GRDP based on constant prices in 2010, South Halmahera Regency 2013-2019 (million rupiah) No Typology Calculation Results Klassen Quadrant

1 Agriculture, Forestry and Fisheries IV 2 Processing Industry IV 3 Electricity and Gas I 4 Procurement Procurement Water, Waste Management, Waste and I Recycling 5 Construction II 6 Wholesale and Retail Trade; Car and Motorcycle Repair IV 7 Provision of Accommodation and Food and Drink I 8 Information and Communication II 9 Financial Services and Insurance II 10 Real Estate I 11 Government Administration, Defense and Compulsory Social Security IV 12 Education Services II 13 Health Services and Social Activities II 14 Company Services I 15 Other Services I Source : Processed Data, 2020 From table 4. above shows that there accommodation and food and beverage are six sectors that are categorized as provision sector, the real estate sector, the advanced and rapidly growing sectors, corporate services sector and as well as other namely the electricity and gas procurement service sector. And in the category of sector, the water supply sector, waste potential or developing sectors, there are five management, waste and recycling, the sectors, namely the construction sector, the

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Prince Charles Heston Runtunuwu information and communication sector, the a. Development of the agricultural sector, financial services and insurance sector, the which is the basis for the economy of education services sector and the health South Halmahera Regency, is pursued in services sector and social activities. While synergy with the transportation and the latter category is relatively warehousing sectors. underdeveloped, there are four sectors, b. The development of the mining and namely the agriculture, forestry and fisheries quarrying sector which is a basic sector sector, the manufacturing industry sector, the with efforts to synergize with the wholesale and retail trade sector; repair of electricity and gas procurement sector cars and motorbikes, and finally the which is a non-base sector, as well as the government administration, defense and accommodation and food and beverage social security sectors are compulsory. provision sector and the information and Meanwhile, the mining and quarrying and communication sector. transportation and warehousing sectors are c. Development of the wholesale and retail not included in the four classification trade sector; car and motorcycle repair is categories of the sector. a basic sector that is expected to Discussion of Leading sector synergize with the financial and Basic sectors Referring to the results of insurance services sector, the corporate the LQ analysis in South Halmahera Regency services sector, and other service 2013-2019,can be developed basic a synergy sectors. policy between the sector and the non-base d. the processing industry sector, the water sector in South Halmahera Regency. With a supply sector, waste management, waste combination of the economic base theory and recycling, the education services approach and empirical experience, it is sector, the health services sector and hoped that there will be integration between social activities, which are the basic the basic sector and the non-base sector as an sectors of the South Halmahera Regency important element in encouraging economic economy, are expected to boost the growth in South Halmahera Regency in the construction sector, the real estate sector future. This is in line with the theory of and the government administration, economic growth according to Widodo defense sector. and compulsory social (2006). Economic growth is an important security which is a non-basic sector. element in regional development. An The development of the potential for increase in the economy in a region indicates the economic sector which is the basis for the that there is development in that region. future needs to be the main target of However, economy is not the only aspect of development priorities, and it is hoped that it development. The economy in a region is cannot be separated from the development of said to be experiencing growth or the non-base sector as well as efforts to development if the number of goods and synergize between the basic and non-basic services physically produced by the economy sectors. So that in the future it will be able to increases in size compared to the previous increase the absorption of a large workforce year, the area referred to here can be in the and be able to encourage optimal economic form of a province, district or city. To see the growth in South Halmahera. This is in line increase in the amount of goods produced, with the sector theory put forward by Widodo the effect of changing prices on the value of (2006), namely the leading sector is a sector regional income in various years must be that is able to encourage growth or eliminated, namely by calculating regional development for other sectors, both sectors income based on constant prices. In this that supply their inputs and sectors that use context, the development of potential policy their output as input in the production synergies between sectors can be carried out process. The sector that is very important in as follows: the economic development of a region does

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Prince Charles Heston Runtunuwu not only refer to geographic location but is a advanced and fast-growing sectors (Quadrant sector that spreads out in various economic I), advanced but depressed sectors (Quadrant channels so as to be able to drive the II), potential sectors (Quadrant III), and economy as a whole. disadvantaged sectors (Quadrant IV) . (2) the Discussion of Classical Typology sectors classified as advanced sectors in The electricity and gas procurement Quadrant I and Quadrant II (totaling 4 sector, the water supply sector, waste sectors) are the basic sectors in Pakpak management, waste and recycling, the Bharat Regency with LQ> 1. (3) there is a accommodation and food and beverage positive and significant influence between provision sector, the real estate sector, the the basic sectors on the GRDP of Pakpak corporate services sector and other service Bharat Regency. In line with the theory of sectors of the six sectors which are classified economic development according to Arsyad as sectors. a sector that is developed and (1999) regional economic development is a growing rapidly, this shows that both in process in which local governments and their terms of competitiveness in terms of communities manage existing resources and contribution and growth, these five sectors form a partnership pattern between local are positive. This is in line with the sector governments and the private sector to create theory Sambodo in Firman (2007) the new jobs and stimulate the development of characteristics of a sector that have economic activity ( economic growth) within advantages are as follows: the region. The process of economic growth a. The sector has a high economic growth is closely related to structural changes rate. (Todaro, 1997). b. This sector has a relatively large Government administration sector, distribution rate. defense and compulsory social security, c. This sector has high inter-sectoral wholesale and retail trade sector; car and linkages either forward or backward. motorcycle repair, the manufacturing sector, d. This sector is able to create high added and the agriculture, forestry and fisheries value. sectors, these four sectors are relatively Meanwhile, the information and underdeveloped, there needs to be action communication sector, the financial and from the government in the form of policies insurance sector, the services health services in their management to develop these three sector and social activities, the construction sectors so that they can become potential sector, and the education service sector, these sectors to be developed in South Halmahera five sectors are in the category of potential or Regency. It is hoped that the potential sector developing sectors. Of the five sectors, the for the region can provide large added value government of South Halmahera Regency so that it has a positive impact on the growth can make a regional development planning of the sector. effort by developing sectors in South Discussion of leading sectors that are Halmahera Regency which in the future will priorities for development. According have a positive impact on the development of toRachbini (2001) there are 4 conditions so the industrial sector itself or other economic that a certain sector becomes a leading / sectors. This is in line with previous journals priority sector, namely: 1. The sector has a researched byHutajulu dan Nasir (2018)with large enough demand 2. Due to technological the title analysis of leading sectors and the developments, the production function is effects of economic growth in West Fakfak shifted to a wider capacity development 3. Regency. The tests used in this study were There must be an increase reinvestment of the Klassen Typology test, Location the products of the priority sector, both Quotient, and Least Square. This study found private and government. 4. The sector must that: (1) the economy of Pakpak Bharat develop, so that it is able to influence other Regency is divided into several quadrants, sectors. From the information above, it is

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Prince Charles Heston Runtunuwu included in the leading sectors that need to be non-basic sector, namely the sector of developed according to the above providing accommodation and food and information, namely the education services drink, transportation and warehousing, the sector and the health service sector and social information and communication sector, the activities, because the service sector has the corporate services sector, and the potential to be developed considering the government administration, defense and positive value of Location Quotient analysis, social security sectors, which must have an then included in the dominant growth and is LQ <1 this basis means that the 10 sectors a sector that is advanced and growing can only meet the needs of South Halmahera rapidly, and has a considerable contribution Regency and cannot meet the needs of other to the GRDP of South Halmahera Regency. regions. In addition, the 10 sectors are also Then the activities of that sector will also able to increase the economic growth of have a positive effect on other sectors. South Halmahera Regency. The results of Then for several non-basic sectors in Klassens Typology from the three South Halmahera Regency, it is hoped that classifications typology sector that give the there will be efforts to encourage each non- biggest competitiveness against South basic sector in South Halmahera Regency in Halmahera Regency consist of six sectors, its economic activities based on its potential. namely the electricity and gas supply sector, So that later it will be able to become a the water supply sector, waste management, commodity producer that has waste and recycling, the accommodation and competitiveness and selling power which in food and drink provision sector, the real the future will be able to contribute both from estate sector. , the corporate service sector the absorption of its workforce and in and other service sectors. increasing income that can encourage economic growth in South Halmahera REFERENCES Regency. Apart from that, the creation of Amalia, Fitri. 2012. “Penentuan Sektor investment opportunities can also be done by Unggulan Perekonomian Wilayah empowering the potential of the leading Kabupaten Bone Bolango Dengan sectors owned by each sector. Pendekatan Sektor Pembentuk Pdrb.” Etikonomi 11(2). CONCLUSION There are 13 sectors in the basic sector Arsyad, Lincolin. 1999. Ekonomi category, namely the agriculture, forestry Pembangunan Edisi Keempat. STIE and fisheries sector, the mining and YKPN, Yogyakarta. quarrying sector, the processing industry Blakely, Edward. 1994. Planing Local sector, the electricity and gas supply sector, Economic Development Teory and the water supply sector, waste management, Pratice Second Edition,. California waste and recycling, construction sector, USA: sage publications. wholesale and retail trade sector; repair of cars and motorbikes, the transportation and BPS Kabupaten Halmahera Selatan dalam warehousing sector, the financial services angka (2019). Statistik PDRB and insurance sector, the real estate sector, Kabupaten Halmahera Selatan. BPS the education service sector, and the health Kabupaten Halsel, , Kec. Bacan. services and social activities sector, and the ------(2019). Statistik Laju Pertumbuhan latter, namely the other service sector, is the Ekonomi Kabupaten Halmahera base sector that can increase district Selatan. BPS Kabupaten Halsel, economic growth South Halmahera during Labuha, Kec. Bacan the period 2013-2019. The Location Quotient results shows ------Kab. Halmahera Selatan Dalam Angka, there are 4 sectors that are included in the 2020 Laju Pertumbuhan Kabupaten

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