A tale of two Indonesias emerges amid miracle growth story

‘Jokonomics’ has created an economy that offers investors great potential for growth, but reality suggests President-elect Prabowo Subianto will have much to do for the country to truly take off.

- Lin Suling

In the early 2000s, geoeconomics in Asia revolved around enabling China's rise.

From supporting the country's entry into the World Trade Organisation to the creation of trade pacts like the Regional Comprehensive Economic Partnership to guide economic collaboration, countries in the region have acted in concert not only to enable but also to find opportunities in China's ascendancy.

For South-east Asia, a similar story is playing out today, where the priority for the next 20 years may be to facilitate and hitch national sails to Indonesia's rise.

THE RISE AND RISE OF INDONESIA

In 2024 alone, Indonesia moved up the IMD World Competitiveness Rankings, beating Japan and Britain, went up on the World Intellectual Property Organisation's Global Innovation Index, and jumped 13 places on the UN's E-Government Development Index. The country has also begun talks to join the Organisation for Economic Cooperation and Development (OECD).

Indonesia's longer-term potential is evident in its demographic trajectory, an abundance of natural resources and an increasingly business-friendly regulatory environment.

Its growth may yet be turbocharged by political ambitions. The World Bank projects a growth rate of 5 per cent over the next three years. But President-elect Prabowo Subianto has an eye on an 8 per cent target in his first term.

"Indonesia has undeniably seen an impressive transformation over the last 10 years," Mr Charles Ormiston, founding partner of Bain and Company's South-east Asian business and member of non-profit Angsana Council, tells me.