Sampai jumpa, Indonesia

After three years and a lot of fried tofu, I am this weekend leaving Jakarta to return to Australia. It's been a fantastic time here, full of new friends and new experiences. But the time is right to pulang kampung for a new challenge.

Before I head down the tollroad to Soekarno-Hatta one last time, I offer up a collection of observations about Indonesia - where it is, and where it's going.

- The facade of democracy is in place, but it still lacks form. At first glance, Indonesia has all the institutions of democracy - a phalanx of political parties, regular free elections, a free press and an active civil society. Most importantly, just about everyone recognises that it's the only game in town when it comes to accessing political power. But on closer inspection it becomes evident that these institutions sometimes fail in practice to fulfill their purpose - political parties are personality-driven rather than policy-driven, bribes are used to woo voters, major media outlets are owned by key political figures and the availability of protesters-for-hire devalues public shows of discontent. Consolidating democracy in Indonesia involves giving substance to the signifiers.


 - Cultural battle lines are being drawn. With a large number of people having reached adulthood during the Reformasi period that began with the downfall of Suharto in 1998, there is a critical mass of people keen on values of cosmopolitanism - democracy, religious tolerance, cultural creativity and right rather than might determining which ideas prevail. But advocates of those values are facing a struggle against conservatives keen to return to some of the institutions of Suharto's New Order, such as a strong military and nationalist cultural agenda, while also seeking to promote Islamist ideas. This tension can be seen in issues like the Jakarta concert planned by Lady Gaga in 2012, when a hard-line Muslim group sought to assert its authority over younger, more permissive youth in determining whether the event could go ahead, and found willing supporters among the police and some political elite. The broader battle is for the heart and soul of the nation, and neither side is likely to yield easily.

- Demographics are a great opportunity, but also a great threat. Indonesia has a high and growing share of its population of working age, giving it great potential to establish itself as the powerhouse economy of Southeast Asia with booming manufacturing and resources industries. Handled well, this will fuel the growth in the middle-class, which is already sizable. But if it fails to generate enough job opportunities for the half the population now aged under 29, Indonesia risks having this youthful population turn angry and vent its fury on the state. The large number of young, idle men that were a decisive factor in the emergence of the Arab Spring could yet cause similar issues in Indonesia. The country would be wise to unleash the creative potential of its people.



- Economic prospects are bright, but beware of complacency. There's no mistaking the potential for Indonesia's economy, where favourable demographics, abundance of natural resources and closeness to the major consumer markets of Asia leave local and foreign investors alike giddy with excitement. But if the country's policy-makers assume that rapid growth is its assured destiny, they could be in for a shock. The country needs to put in place the right policy settings to grow the economy and encourage investment, both from home and abroad. It needs to balance the national budget with hard-but-necessary actions like cutting fuel subsidies, turn the bold plans for improved infrastructure into reality and improve the quality of education so that graduates are creative and analytical thinkers rather than rote learners. Without that, Indonesia will lose out to its more-nimble neighbours.

- Greater Jakarta is packing too many people into too small a space. Depending on where you place the boundary, Jakarta is home to between 8 million and 20 million people, and the number grows steadily each year. Few countries in the world have such a high concentration of economic, political and cultural activity in a single city. The infrastructure and job opportunities, however, have failed to keep pace. This has left the capital as a tough urban jungle, with notorious traffic jams, poverty and crime that make it tough to lead a good life. The solution often touted is to improve the supply of infrastructure, through projects like an urban train network, floodwater canals and high-rise public housing. But the problem is already too entrenched for those things to make much difference. Instead, a demand-side approach is needed - cut the number of people living in the capital. Partly this can be achieved by boosting job opportunities in other cities and villages so that ambitious young people don't feel that they have to move to Jakarta. It might also involve the previously touted relocation of the capital to somewhere outside Java, so that the share of the population whose work involves the national government move with it.

- Religious pluralism remains perilous. President Yudhoyono may have last year received an international award for his efforts to promote religious tolerance in the country, but the reality is that the country is occasionally hostile to some faiths. While there are six religions formally recognised in Indonesia, nearly 90 percent of the population are Muslim and a significant minority within that group adopts a fairly doctrinaire approach to their faith that sits uncomfortably in a multi-religious environment. Many cases are emerging in which religious minorities are targeted by hardline Islamic forces - look at the blockading of the GKI Yasmin church in Bogor and the arrest of an atheist in Sumatra. But many conflicts are between different strands of Islamic thought - like the brutal thuggery against the Ahmadiyah in West Java and the anti-Shiite tensions that led to dozens fleeing Madura island. Some enlightened Islamic leaders are preaching tolerance, but there are still others who have dreams of a Shariah state.



- Remarkable sense of unity across the country. Indonesia is far from a natural political grouping, with a wide diversity of cultures spread across 17,000 islands, and it was only during the Dutch colonial period that it came to be recognised as a single political entity. Many people feared when Suharto fell and East Timor broke away that the country would Balkanise, with forces seeking independence in Papua, Aceh and other places asserting their claim. But most of that restiveness has settled, and few see a better future for themselves outside Indonesia than within it. Despite the cultural and geographic differences between many parts of the country, cities and villages are actually incredibly similar. Pick any town in Indonesia and you're sure to find an alun-alun (central square) at the heart of it, warungs (street stalls) and kaki limas (wandering vendors) selling bakso (meatball soup) and gorengan (fried things) and teens in black jackets offering lifts on a motorcycle. Even the streets that radiate from the centre will carry the same names, honouring heroes like Diponegoro, Yani and Sudirman. Such similarities suggest that Jakarta has been very effective in instilling a sense of nationhood that transcends regional identity.

I've been very fortunate to watch Indonesia up close over the past three years, moving through periods of despair about some of its intractable problems to admiration for the thriving democracy and economy that has emerged. At the end of the New Order period 16 years ago this future was far from assured, but the hard work of its people has left it largely peaceful and unified. There's even data to suggest that it's the happiest place in the world.

Indonesia's a fascinating place to watch, and the rest of the world would be wise to keep a close eye on it. I look forward to seeing what the years ahead hold. Over and out.

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