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Cautious Optimism on Indonesia Political and Economic Landscape

Cautious Optimism on Indonesia Political and Economic Landscape

The Eid al Fitri break, scheduled as a national holiday lasting at least until the 10th of June; after worries that the 21 and 22 May riot would proliferate turned out to be unfounded, the Eid holiday break has proved to be a sort of ‘national decompressing’ period, which is necessary after such a socially tense election season. The ideological break between the two camps has mirrored similar tensions in the United States between ideologues of the two parties, as well as in the United Kingdoms surrounding the Brexit issue. The results of the legislative elections will map out the playing field for the immediate future, and will have significant legal and economic implications.

In addition to this risk of legislative blind spots, security and anti-terrorism will likely continue to be a concern, even as Indonesian society are becoming more split ideologically, with several terror attacks foiled within the last month or so. With the final result of the legislative elections, subject to the MK’s decision on some disputes, the final figure of which will not likely change substantially, and the recent movement of Partai Demokrat (SBY’s party) and PAN to get closer to Joko Widodo, it’s interesting to note that the new government is poised to enjoy more support from the Parliament in legislative and budgetary issues, potentially guaranteeing a smoother implementation of Joko Widodo’s mega-infrastructure and innovative populist programs.

Despite the worries surrounding the energy trade deficit, our Finance Minister has reportedly voiced cautious optimism in general merely due to the relative size of our domestic market, and how underused it still is, marking a potential for growth that has shown signs for optimal utilization judging by how easily the Indonesian market co-opts Industry 4.0 innovations. With proper regulation to ensure the economy does not grow too unequal, as well as to minimize the risks of cyber-crime, and with proper guidance by lawyers of integrity, it is not delusional to hope that Indonesia could become a robust economic powerhouse.

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