Can Indonesia Become a Powerhouse?



    When thinking of large countries, Indonesia typically does not come to mind. On the map, it appears as a medium-sized archipelago between Australia and Asia. But in reality, Indonesia is gigantic. Indonesia spans a distance equivalent to the distance between Switzerland and Afghanistan, and when placed on top of the United States, it is revealed that Indonesia spans an east-west distance which is bigger than that of the American mainland. Indonesia is slightly smaller than Mexico in terms of land area, making it 14th in the world - but by population, Indonesia is 4th. These two factors - a moderately large archipelago separated by substantial amounts of ocean, and a huge population of 261 million, are both a blessing and a curse for Indonesia.
      Indonesia's history has been dominated by two things - trade and war. Indonesia's geography put it in an extremely advantage position in terms of trade. Historically, the global economy (up until around 1700-1800) was dominated by India and China. With no real viable land route between India and China, traders between these two civilizational colossuses were essentially forced to pass through Indonesia. Arabic traders carrying goods from Africa or the Middle East would also need to pass through Indonesia in order to get to China. Over time, these various elements mixed, making Indonesia one of the most diverse countries on Earth. Indonesia contains multiple different ethnic groups with multiple different languages, and although Indonesia's main religion is Islam, there are also sizable Hindu and Christian minorities.
      However, Indonesia's geographical location has also made it the subject of many invasions. During the 13th through 15th centuries, Indonesia was ruled by the powerful Majapahit, a Hindu empire whose sphere of influence spanned much of southeast Asia. But, after a bloody civil war over a hereditary dispute, the rise of Islam in the region eventually ended the Majapahit. In 1511, the Portuguese came, and in their attempt to dominate the spice trade, fought several wars with local kingdoms. Eventually, as the Portuguese were distracted with other parts of their overly-expanded empire, the Dutch managed to bring the region under their control, unifying it into the "Dutch East Indies". In 1942, the Japanese conquered the Dutch East Indies, and imposed a brutal occupation on their subjects. Indonesia's independence in 1949 was the result of a sporadic, four year long conflict, and the country's history throughout the 1950s and 1960s saw bloody conflict involving communists, Islamists, and nationalists. Muhammad Suharto, who took power in 1967 following an anti-communist purge, was arguably the most corrupt leader in history, embezzling anywhere from 15-35 billion dollars during his 31 year rule.
     Despite its recent history, Indonesia's economy is still reasonably strong. Indonesia's GDP is around a trillion dollars, and its GDP per capita is roughly $4000 - and when adjusted for purchasing power (PPP) both of these numbers triple. Furthermore, Indonesia's economy is quite well balanced - agriculture, mining, industry, and services all make up around 15-20% of the Indonesian economy. Indonesia's most visible obstacle, like that of many other developing nations, is the snake of corruption. Corruption is systematic and widespread in Indonesia - something which must change if Indonesia wants to truly emerge as a dominant force in Asia. But Indonesia's second problem is caused by its size. Much of Indonesia's political and economic power is concentrated in the capital city of Jakarta, a giant, densely packed metropolis with a population of over 10 million. Jakarta is on the far western tip of Java - Indonesia's largest island in terms of population, with over 140 million people. This means that 120 million (roughly half) of Indonesia's population require a plane or boat to reach the capital. This lack of connectivity not only makes Indonesia difficult to govern, but also makes it hard for a national economic system to grow. The lifeblood of the Indonesian economy is shipping - all of Indonesia's major islands have large amounts of maritime infrastructure, allowing for bulk goods to be shipped between islands. However, this dependence on maritime shipping makes Indonesia's waters highly vulnerable to piracy, a problem which is amplified by Indonesia's mediocre and outdated navy. Shipping is also much slower when compared to road or rail.
    A potential solution to these problems is the Sundra Strait Bridge proposal, an ambitious proposal to build a gigantic bridge between Java and Sumatra. This would promote tourism and industrial development in Sumatra, and provide a strong link between two of Indonesia's most important economic centers. However, numerous technical problems (such as the potential for earthquakes) along with the initial investment required, have resulted in the project being temporarily shelved. If these problems can be solved, and Indonesia can rid itself of corruption, then the construction of the Sundra Strait Bridge would be a boon for Indonesia.  But these two requirements, and the second one in particular, will be immensely difficult to solve. If widespread corruption is still present during construction, the cost will balloon, and the bridge will suffer from delays and setbacks.
     Politically, along with the aforementioned corruption problem, Indonesia also faces a growing Islamist problem. As a multi-ethnic, extremely diverse country, Indonesia has always used its diversity as a bulwark against divisive, hard-line nationalism - but this may be beginning to change. In November of 2016, the FPI - a group of hardliner Islamists who wish to bring Sharia law to Indonesia -  held a massive protest in Jakarta, with around 100,000 people participating. It is unlikely that the current Indonesian democracy crumbles (the current president, Joko Widodo, is extremely popular) - but if it does, and Islamists end up taking power, Indonesia's economic development will be stunted. Islamism is fundamentally opposed to materialism, as it rejects the decadence and indulgence of the modern world - and thus, Islamism poses the greatest threat to Indonesia's future economic development. There is also the fact that an Islamist dictatorship would be horrendous for Indonesia's non-Muslim minorities, and would end any semblance of secularism or democracy in Indonesia.
    Indonesia is a nation which is ripe with potential, but has numerous obstacles standing in the way between it and success. Just like Nigeria and Brazil, Indonesia's main obstacles are corruption and a lack of infrastructure. Only time will tell if Indonesia can truly overcome these barriers - but if they can, the potential of Indonesia's huge population will quickly be converted into productivity. 

Comments

Popular Posts