Indonesia, meet your new president. Image source: Metal Injection

Indonesia, meet your new president.
Image source: Metal Injection

Napoleon (supposedly) once said of China, “It is a sleeping giant. Let it sleep, for when it wakes, it will shake the world.” If he ever said that, he was right, and China has awoken and is reshaping the world to its whims. Meanwhile, some foreign policy observers look at India and wonder if it will join China as an upstart power destined to reshape the world. Its ambitions are on a decidedly smaller scale, and its economy and society have a lot of catching up to do (with China, not just the rich world), but in many respects they have a point. Yet there’s another Asian power with a great reservoir of untapped potential that’s escaped the gaze of most international observers. Its ambitions are pretty modest and it doesn’t have the swagger and bravado of its bigger neighbors, but keep an eye on it, for it too has the potential to shake up East Asia and affect the international balance of power.

That country is Indonesia, a vast island country sprawled across the sea beneath East Asia like a family lounging on the steps of a great mansion, lethargic in the tropical heat. It is by far the largest country in Southeast Asia and one of the largest in the world. It’s also one of the largest by population; with 250 million people, it’s the fourth-largest, behind America but well ahead of Brazil. In terms of its economy, it has the 16th-largest in the world (ranked by nominal GDP).

Yet for a country with so much to boast of, it remains one of the most underappreciated and overlooked of the world’s major countries. Vikram Nehru of the Carnegie Endowment for International Peace refers to it as “one of the world’s best-kept secrets.” References to Indonesia seldom appear in mainstream media or culture outside of Malaysia, Singapore and the Netherlands (its former colonial master); even foreign policy experts tend to brush it off, unless they’re East Asian specialists. There’s no Indonesian diaspora community, again except the Netherlands. Resources for learning Indonesian are tough to come by. Its history is rarely mentioned in world history books (although, to be fair, the rest of Southeast Asia is also skipped). Aside from the hordes of vacationers overwhelming Bali (one of its islands, albeit one many foreigners don’t necessarily associate with Indonesia) and the odd trip west to Java to see the impressive ancient monuments of Yogyakarta, tourists don’t go. Elizabeth Pisani, in her new book on the archipelago Indonesia Etc.: Exploring the Improbable Nation, expresses her frustration with overseas ignorance of her “Bad Boyfriend”: “I had become used to seeing a mildly panicked look in people’s eyes when I mentioned Indonesia at a drinks party in London or New York. I can see them thinking: ‘Oh God, Indonesia… is that the new name for Cambodia, Vietnam, those places near Thailand…?’”

(To be fair, Australia, which is much closer to Indonesia than any other Western country, has a more intimate relationship with it, and its new prime minister, Tony Abbott, is making relations with Indonesia a high priority. Australians are also a big part of the crowds in Bali. I’ll give Australia a pass.)

On the international stage, Indonesia keeps a low profile. Even within the Association of Southeast Asian Nations (ASEAN), Southeast Asia’s version of the EU, Indonesia doesn’t stand out much from the other member states – even though it makes up 40% of Southeast Asia and is more than double the population of the Philippines.

So why is it that this huge, important country, in a part of the world under increasing attention these years, has been so overlooked?

Part of it is just a symptom of its location. Southeast Asia in general is quite overlooked. When people refer to “East Asia,” they tend to really mean “Northeast Asia” (and increasingly, basically China). The whole area is poorer and more tropical than the north. It’s defined by colonialism: the whole area was colonized by European powers and America, which ultimately held it back compared to its northern neighbors. Then again, this isn’t a terribly convincing explanation, since colonialism by definition means there were more foreigners there, and therefore more exposure to the region. And Indonesia, given its size (it makes up about 40% of Southeast Asia) seems disproportionately ignored.

But Indonesia hasn’t done a very good job of utilizing the opportunities bestowed to it upon independence in 1945. To summarize Indonesian history briefly: Its founding father, Sukarno, became a dictator. He envisioned a socialist future for his country, similar to what Jawaharlal Nehru was doing in India, and created an economy dominated by the state. It worked out even worse than in India, and by the ‘60s Indonesia’s economy had collapsed. To distract his people from the mess, he picked pointless fights with Malaysia, the Netherlands (who still hadn’t left New Guinea, Indonesia’s easternmost island), and America. He got (the western half of) New Guinea, but the other fights went nowhere. Instead, as a backlash against rising Communist influence, the military launched a coup, which resulted in a new dictatorship – and a massive purge of suspected Commies (which is probably a topic for another post).

The new dictator, Suharto, helped fix some of the problems Sukarno had caused. He reoriented Indonesia’s economy, making it more business-friendly, and welcomed foreign investors. He listened closely to foreign economic advice and made Indonesia into a major commodity exporter. Indonesia has tons of minerals, wood, fish, palm oil, and regular oil, which is part of the reason colonial powers had descended upon it in the first place. (I guess I should also mention it has spices, although those are a lot less valuable now than they were in the 1500s!) Suharto managed to revive the Indonesian economy by developing these sectors as well as some basic manufacturing. But of course all this money was concentrated in the hands of a few – his family members and those closely connected to him. Java, Indonesia’s main island with over half of its population, hosted most of the industry and wealth. Like all dictators, Suharto clamped down on dissent.

The Asian financial crisis of 1997 put an end to this. Indonesia’s currency, the rupiah, proved vulnerable to the havoc that the crisis wrought on Asian economies. Prices soared, tempers flared, and after some nasty riots and ethnic pogroms, Suharto was out. To make matters worse, East Timor voted to secede (which is another story), prompting a short war. Combined with rumblings in the northern part of Sumatra (Indonesia’s second-biggest island), New Guinea again, and cannibalistic tribal warfare in Borneo (Indonesia’s biggest island), it seemed like the country was falling apart, or even descending into chaos and barbarism.

This messy era, immortalized in Richard Lloyd Parry’s In the Time of Madness: Indonesia on the Edge of Chaos, made a lot of foreigners just write off Indonesia altogether. A troubled economy? Violent separatist movements? Islamic extremism? Forget about it! Better to bank on Thailand, Southeast Asia’s rising star and a perennial favorite among outsiders. Remember, there’s a paucity of works of any kind on Indonesia. The Sukarno-to-Suharto transition period is immortalized in the movie The Year of Living Dangerously. When Indonesia has appeared in the news recently, it’s usually been in troubling contexts like a nightclub bombing in Bali in 2002, or the Jemaah Islamiyah terrorist group.

Yet those who wrote off Indonesia were mistaken. It’s made a lot of progress since the Time of Madness. Its economy has rebounded from the depths of the financial crisis and was barely affected by the global crash a decade later. With the cost of labor in China rising, Indonesia has become a new destination for low-wage manufacturing. Living standards are slowly increasing; Jakarta, the megacity, and to a lesser extent Surabaya, the second city, have swank, vast malls and posh nightclubs. According to a 2013 Boston Consulting Group report, the economy is growing at 6.4% a year and the middle class will double to 141 million people by 2020.

Economics are nice, but arguably the political situation in Indonesia is even more impressive. As a reaction to Suharto’s heavy-handed regime, Indonesia rapidly decentralized around the turn of the millennium. Regencies (the division below provinces) now have a great deal of power. While this has led to an explosion of corruption and political shenanigans, as illuminated by Elizabeth Pisani in a recent essay in Foreign Affairs, it has also given more power to the people, and helps preserve Indonesia’s unity by giving regions more latitude to determine how to govern all those islands. Despite much foreign misgivings, Indonesia now seems firmly entrenched in the League of Democracies; not only has it successfully and peacefully handed off power from its elected leader, the gloriously named Susilo Bambang Yudhoyono, it’s elected a guy who got his start as a furniture salesman in a medium-sized city called Joko Widodo (or “Jokowi” for short). While it’s too soon to say how he will govern, his rise to power was grounded on his grass-roots popularity and effective governance in his hometown and Jakarta.

I feel that another important reason why Indonesia lacks international stature is simply that Indonesians don’t promote their country enough. There’s no ready-made image that pops to the mind when you hear “Indonesia,” unlike India, China or Japan. Indonesia lacks a sense of national identity or unity. It has a history of colonialism and a shared language – although that language, Indonesian, was constructed from Malay, and most people speak different languages natively. Its dominant religion is Islam – although there are Christian and sort-of-Hindu minorities, and the Islam practiced in Indonesia is usually a heckuva lot more lax than in Saudi Arabia. There are oodles of ethnic groups – even on Java, the main island, Sundanese, Madurese and Chinese break up the mostly Javanese tableau. Sukarno concocted a unifying ideology, “Pancasila,” but it’s transparently artificial, and the real reason Indonesia exists is the Dutch – its borders conform exactly to the old Netherlands East Indies.

But I’m optimistic about Indonesia’s prospects. East Asia in general is going through a prolonged boom, and people everywhere have more opportunities to be successful and happy than ever before. Its expanding population of young, working-age people and wealth of natural resources suggest a bright future. Decentralization seems like a natural fit for such a diverse, sprawling nation. And in my time there, I found Indonesia’s people to be welcoming, good-natured and relaxed; it wasn’t the sort of dreary, hostile place some foreigners might expect.

That’s not to say Indonesia doesn’t have problems. It could very well mess this all up. Corruption and political abuses drag everything down (but find me a developing country where this isn’t the case). Fanatical Islam persists and occasionally bursts out into the open, worrying non-Muslim foreigners. Staking everything on commodities is a risky proposition, and Indonesia won’t get far until it diversifies its economy; it’s also a great way to devastate the environment.

But given the welcome result of the presidential election, and the cheery, laid-back personality of Jokowi, it’s easy to be optimistic. Indonesia will never be a China, or even an India, but it can aim to be a Middle Power – it has the population, economy and geographical reach to dominate Southeast Asia. Given its neutrality in the brewing cold war between America and China in East Asia, it can help mediate the conflict. It can chortle at Thailand, which is sinking under the weight of prolonged political stability and military dictatorship, and delight in being the biggest Muslim country and a democracy at the same time. And whatever the outcome of his presidency, Jokowi’s story, like that of that honorary Indonesian, Barack Obama, is a hopeful one to inspire the beleaguered masses all over the globe. “Now, it’s quite similar to America, yeah?” Jokowi said after winning the election. “There is the American Dream, and here we have the Indonesian Dream.”

Indonesians can come off as overly relaxed and insular, perhaps because it’s a tropical island country. They should be more ambitious and seize their opportunity!


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