A key lesson Indonesia should learn from Turkey

Jakarta has various models to follow in its effort to grow the economy. Turkey offers a cautionary example.

- Daniel Moss

The replacement of Indonesia's high-profile finance minister is starting to look a bit like regime change. President Prabowo Subianto has made no secret of his belief that much needs to change for economic growth to have a prayer of reaching the rapid clip he desires. Great care should be taken on the road there.

The central bank, for one, has bought into Mr Prabowo's agenda - to the point where the shock may become the norm. Last week's interest-rate cut was anticipated by just two of 38 economists polled by Bloomberg. Fiscal policy, too, may slip guard rails that have served the archipelago well: The Parliament, where the President's allies enjoy a big majority, will review a law that sets strict limits on the budget deficit and debt. One golden rule of politics, around the world, is don't have a review unless you know the result you want.

Governance in Indonesia is clearly on the cusp of a transformation. But in whose image?

Mr Prabowo has expressed admiration for Deng Xiaoping, who as China's top leader, reshaped his Communist nation and laid the ground for an epic expansion. He has also spoken of Singapore in glowing terms, and wants to copy certain policies.

Learning from examples is fine. But one country Indonesia should refrain from emulating is Turkey.

On a superficial level, Turkey's rate of growth is impressive. Gross domestic product has increased at around 5 per cent a year for about two decades, a pace that's similar to Indonesia's.