Rising inequality hampers poverty alleviation in Indonesia

Indonesian children sort oysters at a slum area in North Jakarta. (Photo: AAP).

Authors: Riyana Miranti, University of Canberra, Alan Duncan and Rebecca Cassells, Curtin University.

How effective was Indonesia in addressing poverty and inequality in the decentralisation period?

In the first decade of the decentralisation period, from 2001–10, Indonesia’s GDP grew at an average annual rate of only 5.4 per cent. Read more…

Indonesia’s bold 2015 budget strategy

An Indonesian employee fills a car with subsidised fuel at a petrol station in Jakarta, Indonesia, 24 November 2015. The Indonesian Government’s recent elimination of fuel subsidies has relieved pressure on the budget and deficit. (Photo: AAP).

Author: David Nellor, NUS

No more ‘business-as-usual’ is the Jokowi government’s message in the 2015 budget. Fuel subsidies have been cut, infrastructure spending is to be ramped up, and revenues are projected to rise dramatically. These three steps deliver a 1.9 per cent fiscal deficit, down from 2.2 per cent in 2014. Read more…

Banking on oil offers Indonesia prospects of a new bonanza

A worker at Pertamina cycles through barrels of oil. (Photo: AAP).

Author: A. Tony Prasetiantono, Universitas Gadjah Mada

Indonesia’s ‘oil bonanza’ is now over. It ceased to be a net oil exporter and became a net importer in 2004. Indonesia currently produces only slightly above 800,000 barrels per day while the consumption level is about 1.4 million barrels per day. This leaves about 600,000 barrels for net import. In the golden era of oil in the 1980s and 1990s, Indonesia produced 1.6 billion barrels per day while total consumption was about 800,000 barrels per day. Read more…

The hole in the Asian doughnut

One of two foreign fishing boats suspected of conducting illegal fishing activities is blown up by the Indonesian navy in Ambon bay, Indonesia, 21 December 2014. (Photo: AAP).

Author: Peter Drysdale, East Asia Forum

The mutuality of Asia’s economic interests centring on deepening economic integration is a potential foundation for building an Asian economic community that encompasses the ASEAN 10 plus their six neighbours, Japan, South Korea, China, India, Australia and New Zealand. Read more…

Hopes on the economic upside in Indonesia

Indonesian workers on a construction site next to a busy road in Jakarta, Indonesia, 3 December 2014. (Photo: AAP).

Author: Peter Drysdale, East Asia Forum

We begin the 2014 ‘year in review’ series, looking at developments in Asia over the year past and the prospects for the year ahead, with a look at how Indonesia is travelling and the prospects for its economy. Read more…

Optimism on the rise in Indonesia

Indonesian President Joko Widodo (Jokowi) in control. President Jokowi inspecting a military helicopter during the Army's exhibition at the National Monument in Jakarta, Indonesia, 17 December 2014. (Photo: AAP).

Author: David Nellor, Jakarta

A greater sense of optimism prevails in Indonesia about the economy in 2015 than a year ago, even though the reality is now more challenging. Growth is slowing, business costs are on the rise, and key economic vulnerabilities persist. In simple terms, the new government of President Joko Widodo (Jokowi) has been dealt a difficult hand of cards. Read more…

Time to rethink economic policies in Indonesia

An Indonesian employee fills a car with subsidised fuel at a petrol station in Jakarta, Indonesia, 24 November 2014. Incoming President Joko Widodo has lowered fuel subsidies but, like Susilo Bambang Yudhoyono, has not removed them altogether or linked to global prices. (Photo: AAP).

Author: Ross McLeod, ANU

Economic performance in post-Suharto Indonesia has been inferior to that achieved during the previous three decades, with economic growth slower and income inequality increasing. With the recent election of a new president, now is a good time to focus on improving the quality of economic policymaking.

To begin, how should Indonesia make use of its rich natural resources? Read more…