Friday, 10 December 2010

Indonesia Inc.

I was interviewing Dr Ian Bremmer recently, an American political scientist and author of the book ‘The End of the Free Market: Who Wins the War between States and Corporations’, on how he thinks Indonesia is doing at the moment. It’s true that the country has been getting a lot of favourable attention lately, but I wondered whether this is due to Indonesia’s sterling performance or by default, because everybody else in the world is not doing well.

The answer was both. As most of the developed countries are still reeling from the assault of the financial crises, while her developing neighbours also sway from political instability, it is only logical that Indonesia, a relatively stable democracy with a positive growth economy, now seems quite an attractive option for investors looking to place their money. The unassuming wallflower is suddenly the belle of the ball because all the pretty girls have either left the room or collapsed on the floor.

As a matter of fact, Indonesia should be ready to join the rank of the other emerging markets that are currently the darling of investors, with additional benefits. Brazil for instance, would soon have a change of leadership that might not be on the same par as or as charismatic as Lula. India is big but so are her problems and lack of infrastructure. Russia doesn’t really have much to offer investors other than stuff they could dig out from the ground. China is even bigger, but she is not a nice player and likes to make up her own rules that make her a difficult partner.

Indonesia however, has something else to offer. She has a democracy with political stability – a rare thing in this part of the world - a big population and good demographics, not ageing but entering their productive years, plus a menu of investment opportunities ready for the picking. Moreover, she is a member of the G20 and could be the much-needed bridge between the Group’s increasingly rancorous members.

Indeed, Indonesia could emerge as the sobering factor amongst the members itching for currency war and protectionist retaliations. She could come up with a solution based on an economic model of government-led market system that would not be anathema say, for free market economies nor unpalatable to state-controlled China. A model where multinational corporations would be welcome, the private sector thrive and where state-owned enterprises would focus on what they do best, which is serving the needs of the people.

In the midst of the current global financial uncertainty, Indonesia’s stock market has been bullish, the rupiah strong while the central bank remains cautious about the risk of volatility that comes with a surge of capital inflow. And there are certainly plenty of things for foreign investors to get their hands on, from metals, commodities to property, retail and consumer goods.

All we need to do is fix our infrastructure, improve the business climate, tackle corruption and cut down on the red tape and we’re well on our way to creating Indonesia Inc. Now is the window of opportunity, the golden moment to transform ourselves and to finally shine on the world stage.

So, what is stopping Indonesia from rising to the occasion? Most likely it’s stage fright. The fear of being in the limelight because she hasn’t rehearsed her lines properly and secretly feels foolish. The knowledge that she is an understudy being offered the part because the lead actors have got the flu while she herself is far from ready.

Since the political reforms of over ten years ago in effect we have had a whole decade in which to transform ourselves: Almost an entire generation of shaping ‘reformasi’ from ideas into reality. Consider what could be achieved in those years in terms of building infrastructure (roads, public transportations, power, ports etc.), cleaning up the bureaucracy and setting up a strong, transparent and accountable government. If only we had used our time well.

Instead, what we have at the moment is the result of a decade of inability to implement anything beyond churning out a myriad of useless political parties, creating decentralisation that does more harm than good to the integrity and plurality of the nation and a parliament that is more of a hindrance to common sense than a solution.

Our democracy has only succeeded in voting in a bunch of representatives who represent their own interests first above all else, democratising corruption from the top level to the lowest level of government, and above all, electing a president who, even after six years on the job, still doesn’t get that the country’s problems are a lot more important than his own personal grievances. That how the public perceives him should infinitely cause him less concern than the hurts felt by his people.

Ten years on and our basic education system is still in shambles, half of the population unskilled, ignorant and unenlightened; the majority poor in body, in mind and in spirit. Meanwhile, those running the country, the legislative, the law enforcers, the executive, run around in circles as they bicker over power and benefits, waste tax payers money on useless spending and come up with laws more suitable for the Dark Ages than the 21st Century.

A decade of democracy, the ghosts of the past still move amongst us, eating away at the faded dreams of Reform and spreading the veil of forgetfulness over our struggles. I fear that instead of looking at the future and its possibilities, we look behind us and cling to the only certainty we knew.

And before we know it, the man whom the nation once forced down in disgrace and swore to put on trial for his crimes and atrocities, would be dug out, polished, resurrected and be declared a National Hero.

(Desi Anwar: First published in The Jakarta Globe)

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