Consumer confidence shows Indonesia’s prayers may be answered

An Indonesian woman buys her daily needs at a market in Bogor, West Java, Indonesia. (Photo: AAP).

Author: Nigel West, UK.

Despite many economists claiming a rocky outlook is ahead, both investor and consumer confidence in Indonesia is very high. The ANZ-Roy Morgan Indonesian Consumer Confidence survey published in February 2014 revealed that nine out of ten Indonesians believe that the situation over the next five years will be positive, and almost eight out of ten believe that the upcoming year will be one of good fortune. Read more…

How Indonesian local governments spend too much on themselves

Aceh citizens wait in line to vote at a polling station in Banda Aceh in 2012 to elect a governor and mayor. (Photo: AAP).

 Authors: Günther Schulze and Bambang Suharnoko Sjahrir

Indonesian districts spend excessively on their own administration — money that could be spent on delivering public services for the people. The key problem is that democratic accountability is not (yet) sufficiently effective. After the 2001 decentralisation the districts, the third tier of government after center and provinces, are responsible for the provision of basic services such as health, education, and infrastructure and spend around a third of the consolidated government budget. Read more…

Indonesia’s poll and presidency on a coalition course…and the Thais that bind

Popular presidential candidate of major opposition party PDI-P and Jakarta Governor Joko Widodo walks with his supporters in Jakarta following the 9 April 2014 legislative election. He came out ahead in the polls but a worse-than-expected election performance by the party means that Indonesia is staring at a coalition government. (Photo: AAP).

Author: Peter Drysdale, Editor, East Asia Forum

The election for Indonesia’s legislature last Wednesday represents another remarkable achievement in the country’s democratic transition. Indonesians proudly went to the polls and delivered a result that was without major incident and has not yet been disputed (though that may change when the official results are declared in a few weeks). Read more…

What Indonesia’s legislative polls do and don’t mean

Jakarta Governor and Indonesian Presidential favourite Joko Widodo and his wife Iriana Widodo, after voting in Jakarta on Wednesday April 9, 2014. (Photo: AAP).

Author: Liam Gammon, ANU

Indonesia’s PDI-P party, the home of Soekarno-ist nationalism, was expecting Wednesday’s legislative elections to carry it to a stunning comeback after a decade out of government during the Yudhoyono years.

It had the good fortune of being associated with Joko Widodo (normally known as Jokowi), the Jakarta governor whose mass popularity had convinced PDI-P’s old guard to give him the party’s 2014 presidential nomination. Read more…

Does size matter in Indonesia’s party system?

Indonesian President Susilo Bambang Yudhoyono, chairman of the ruling Party Democrat, sings a song  during an election campaign rally in Jakarta, on 3 April, 2014. (Photo: AAP).

Author: Jonathan Chen, NUS & RSIS

Although minor parties in Indonesia may appear handicapped by their relative size, they more than make up for this with their versatility at coalitional manoeuvrings. They are predisposed towards alliances and collective leverage over mutual competition and independent action. They are the unique products of Indonesia’s own brand of proportional representation system in parliament. Read more…

Papua’s uncertain future under the next Indonesian government

Papuan activists in traditional costumes and shirts painted with the colors of the Papuan separatist flag take part in a rally marking the 50th anniversary of failed efforts by Papuan tribal chiefs to declare independence from Dutch colonial rule in 1961, in Jakarta, Indonesia.

Author: Hipolitus Yolisandry Ringgi Wangge, Northwestern University

Papua is a problem that Indonesia’s new president will have to face. Joko ‘Jokowi’ Widodo of the Indonesian Democratic Party of Struggle (PDIP) and Prabowo Subianto of the Great Indonesian Movement Party (Gerindra) are the two frontrunners in Indonesia’s upcoming election. Yet there is limited knowledge on both candidates’ views regarding Papua. Papua, Indonesia’s eastern-most province, will be a crucial challenge Read more…

Is high handed regional diplomacy really in Australia’s interest?

Members of Pemuda Pancasila burn pictures of Australian Prime Minister Tony Abbott during a protest against Australian spying outside the Australian embassy in Jakarta on 26 November 2013. (Photo: AAP).

Author: Donald K. Anton, ANU

In recent times reports in the popular press recount too often international actions taken by Australia that appear decidedly undiplomatic — at least undiplomatic in the sense that they belie an effective management of international relations. These actions have been perceived as provocative (or worse) by a number of neighbours in the region. Read more…

Resource depletion threatens Indonesia’s future

Protesters at an anti-fuel price hike rally in Jakarta on June 19, 2013. (Photo: AAP).

Author: Fitrian Ardiansyah, ANU

The 2014 general election in Indonesia brings an opportunity for the Indonesian public to demand better natural resource management and environmental protection. Resource depletion may shake the very foundation of Indonesia’s exports and eventually its economy. With global demand for commodities likely to increase — especially in fast-growing emerging markets — export growth from Indonesia can only remain buoyant if the country manages its resources wisely. Read more…

Steady as she goes for Indonesian foreign policy, even with a new president

Indonesian President Susilo Bambang Yudhoyono (Photo: AAP).

Author: Awidya Santikajaya, ANU

During his two terms in office, Indonesia’s President Susilo Bambang Yudhoyono has been lauded for reviving activism in Indonesia’s foreign policy after years of difficulty following the 1997–98 Asian financial crisis and the fall of President Suharto. But will the upcoming leadership transition result in a drastic change in Indonesia’s foreign policy? Read more…

Decentralised government: greater demand needed to raise service quality in Indonesia

Students of Islamic school Madrasah Manarul Huda in  South Jakarta, Indonesia. (Photo: AAP).

Author: Blane D. Lewis, Jakarta

The devolution of public service delivery and financing to local governments in Indonesia was legislated in 1999 and implementation began in earnest in 2001. The roll-out of decentralisation is often characterised as a ‘big bang’ because of the speed with which it occurred and the striking extent of reforms. It is not an exaggeration to say that Indonesia went from being one of the most centralised countries in the world to one of the most decentralised in a period of just less than two years. Read more…

Trade policy in swing: Indonesia’s attitude to liberalisation and the TPP

Indonesian dock workers unload  sugar imported from Mexico at Tanjung Priok port in Jakarta. (Photo: AAP)

Author: Yose Rizal Damuri, CSIS

When Indonesian officials are asked about the Trans Pacific Partnership (TPP) and Indonesia’s involvement in the proposed trade agreement, they normally answer that the country is paying attention to the process and the possible results of the negotiation, but has no interest in joining agreement at this time.

Doubt over Indonesia’s capacity to carry out proposed commitments in the trade deal as well as uncertainty regarding the potential for any significant benefits to the economy are cited as the main reasons for this position. Read more…

Volcanos test Indonesia’s disaster management

Residents run away to escape from hot volcanic ash clouds engulfing villages in Karo district during the eruption of Mount Sinabung volcano. (Photo: AAP).

Author: Jonatan A. Lassa, RSIS

After about 400 years of silence, the Sinabung volcano in North Sumatra, Indonesia, has erupted twice in the last five years. The first time was on 27 August 2010. The eruptions lasted for two days, and resulted in no casualties. The second, ongoing eruption period began on 15 September 2013. Since then, eruptions have caused the deaths of at least 45 people, 31 of whom were staying in poorly managed temporary shelters. Read more…

Capital flows in Indonesia: managing the benefits and risks

A stallholder counts out her rupiah at the end of the business day in Jakarta, 16 May 2006. (Photo: AAP)

Author: Hartadi A. Sarwono, Indonesian Banking Development Institute

The resurgence of capital flows to emerging economies took on renewed importance with the growing attractiveness of investment in Asia and elsewhere compared to investment in industrial economies.

The success in managing capital flows generates a great deal of benefit in development, but failure can jeopardise both internal and external stability. Read more…

Policy changes needed to unlock Indonesia’s energy options

An Indonesian fuel vendor puts petrol into plastic bottles as she sells them on a street in central Jakarta, Indonesia. (Photo: AAP)

Author: Raymond Atje, CSIS

Indonesia is richly endowed with energy resources of various kinds: renewable, non-renewable, as well new-energy capacity.

Hypothetically, the government has a reasonably rich list of energy options from which it can choose the most viable resources to exploit. In reality, however, things are not so simple. Read more…

Building a more equitable and productive Indonesia

An Indonesian woman dries her washing in a poor area in Jakarta. In 2010, 18 per cent of people used rivers, lakes or unprotected wells and springs for drinking water. (Photo: AAP).

Author: Arianto Patunru, ANU

At the beginning of 2013 Indonesia’s economy looked to be in good shape. Growth was still over 6 per cent; inflation was manageable at below 5 per cent. Then on 22 May 2013 came a signal from the US Federal Reserve that it would begin to scale back its quantitative-easing program. In Indonesia, in an attempt to reduce budgetary burdens, the government reduced the subsidy (thereby increasing the fuel price) on 22 June. Read more…