Is Indonesia Built to Last?
President Susilo Bambang Yudhoyono presides over one of the world's fastest-growing economies, but corruption threatens Indonesia’s chance at catching its neighborsBy Ted C. Fishman
A lot of politicians in Indonesia sing the same old songs. Singing is one of the informal prerequisites for an Indonesian public official, the way that, say, owning a dog is in the U.S. Old songs, though, do not suit Indonesia’s current President, Susilo Bambang Yudhoyono. “SBY” writes his own material, and last fall he released his fourth album of original tunes, called Harmoni, a musical plea for the environment. The burly 63-year-old President, who stands nearly six feet tall, hardly fits the boy-band archetype popular in Indonesia, but he plays guitar and has a voice that recalls John Denver. He makes music videos, as do his fans (and satirists) on YouTube (GOOG). SBY’s songs often entreat Indonesians to lift up their country and the world, and they reveal the President’s sentimental side. A devout Muslim, he often beseeches God for peace and guidance. During last year’s nationally televised Independence Day Celebration, a schoolboy and a 128-person choir belted out an SBY composition called From Jakarta to Oslo for Our World. It begins:
Far away from the edge of the world
I come to bring hope
Together, allied, the servants of God
We must unite to save
The purity of our world.
Thoughtfulness and empathy are part of SBY’s persona: He occasionally tears up when speaking about issues his government faces, such as the poverty of farmers. SBY came to office in Indonesia’s first direct Presidential election in 2004. In 2009 he was reelected for a second five-year term, garnering 74 million votes, or 60 percent of ballots cast. In a part of the world that has seen its share of strongmen, the former general has avoided the temptation to play autocrat. The country’s 13-year-old constitution, as interpreted by SBY, gives the President surprisingly little power. (He is term-limited from running again.) He must appeal to the country’s instincts for justice, national cohesion, pluralism, and prosperity. That’s a big job in the world’s largest archipelago (17,500 islands), with one of the biggest, most diverse populations on the planet.
To a large degree, he’s succeeding. Economically, Indonesia is doing better than at any point since democracy took hold. Last year the economy grew 6.5 percent, and it is expected to match that in 2012. The world’s fourth most populous country at 240 million, Indonesia has a middle class that is expanding rapidly and now tops 50 million. Global investors pour record sums into the country. Last month, Moody’s (MCO) returned Indonesia to investment grade for the first time since the 1998 Asian financial crisis, following a Fitch Ratings upgrade in December. At its current rate of progress, Indonesia has the potential to become Asia’s next great engine of economic growth.
For some time, U.S. officials have pointed to Indonesia as a Muslim-majority country that the emerging democracies of the Middle East can learn from. During SBY’s first term, his coalition government succeeded in maintaining social order. Where political parties driven by Islamic agendas once looked poised for power, SBY has wrapped just enough of their agendas into his platform to keep the peace and preserve Indonesia’s reputation for tolerance. And since SBY took office, the inter-religious cycles of violence that plagued several parts of the country have been—mostly—tamped down.
Yet for all of Indonesia’s success, SBY is a leader under siege. His approval ratings have fallen from 70 percent two years ago to 50 percent. His political coalition partners constantly try to outmaneuver him. Political rivals, the most powerful of whom own the country’s top media outlets, complain that SBY is too reflective, too democratic, and too conflict-averse to govern effectively. While democracy and commerce flourish in Indonesia, they point out, so does corruption that drains away a huge chunk of public resources and eats at gross domestic product. If Indonesia squanders this moment, say SBY’s friends and critics alike, the nation will likely never catch its more prosperous Asian neighbors. Reflecting on the country’s ability to compete with China and India, Minister of Trade Gita Wirjawan says: “We have lots of experience with disappointment: disasters, corruption, and bureaucracy. … Corruption [in particular] puts us at a disadvantage. The trajectory is good, but Indonesia can’t be complaisant.”