Rapid development of information and technology in this globalization era has driven thetransition of world economy, from previously labor and market economy to knowledgeeconomy. Nation-states’ global competitiveness is measured partly by the number of highlyeducated people within its society. By becoming “world-class”, universities are believed to playan important role to boost a country’s competitiveness level. This paper will discuss theinternationalization of higher education as one of important instruments in achieving the goal tocreate knowledge-based economy. This study will identify the internationalization initiatives ofthe Indonesian and South Korean governments from national level, and universities frominstitutional level. The objective of taking South Korea as comparison to Indonesia is becauseSouth Korea is also a non-English speaking Asian countries, which started theirinternationalization in early 2000s with the same aspirations: higher education reform towardsknowledge economy. The methodology used in this research is a descriptive-comparativequalitative approach. In addition, this paper will further focus on Indonesian case ofinternationalization, by discussing its’ future challenges and opportunities.

Keywords: internationalization, higher education, knowledge economy, Indonesia, South Korea