For President Joko “Jokowi” Widodo, 2015 served as a whirlwind introduction to the national political stage and all of its intricacies. In his first six months the former Jakarta governor often looked reactive, unsure of himself and uncomfortable in the spotlight. But by mid-year he started to find his footing and by year-end had not only started to show results but showed flashes of becoming the transformational leader he had hinted at in his campaign speeches the year before.
It is still early days for the Jokowi administration and the President’s ambitions far outstrip his accomplishments to date. He faces a challenging external economic environment, an entrenched set of vested interests eager to see him fail, and myriad economic handicaps from a decade of missed opportunities in infrastructure development and land reform.
But in the new year the mood in Indonesia is one of cautious optimism. There is a palpable sense of energy in Jokowi’s government that was keenly absent in former president Susilo Bambang Yudhoyono’s stagnant second term. At the heart of this resurgence is Jokowi himself. As Indonesia’s first president not to come from the political or military elite, Jokowi remains something of an enigma, with a vision of national development and a leadership style markedly different from the four post-Soeharto presidents who preceded him.
Jokowi has shown a distinct lack of interest in long-winded national day speeches or high-profile appearances at gatherings of international leaders. Davos Man he is not. This is a president little enamoured with the pomp and circumstance of his office, preferring to lead from behind rather than to grab the spotlight. This has often been misunderstood as passivity or inexperience, but as he begins to settle into his presidency what we are seeing from Jokowi is actually a new type of leadership that Indonesia has been keenly waiting for: empowering, results-oriented and realistic.
The Cabinet Reshuffle Turned Things Around
A Cabinet reshuffle in August stands out as a turning point in Jokowi’s thinking on the economy. Until that point, his top areas of focus were on infrastructure development and re-positioning Indonesia as a global maritime axis. While important, these goals have been eclipsed by the urgent need to hack away at the miasma of regulatory and protectionist measures put in place in former president Yudhoyono’s second term. Nine months into his term, Jokowi recognized that the Yudhoyono government’s regulatory overreach had rendered many Indonesian exports uncompetitive, distanced industry from global supply chains and constituted a massive obstacle to attracting the sorely needed foreign investment Jokowi needs to rebuild Indonesia’s dilapidated infrastructure.
True to form, this change in approach was not announced by Jokowi in a prominent speech. It was a subtle retune, in which a handful of ministers quietly were given new marching orders and a seasoned technocrat in Coordinating Minister for Economic Affairs Darmin Nasution was brought in to provide stability. Three months later, we are beginning to see the outlines of a new course for Jokowi, accompanied by a generational shift in which the Cabinet’s younger, technocratic ministers are enjoying the greatest trust from the President and are playing the biggest role in driving reform.
Former governor Jokowi has also become savvier in managing the interests of the political elite as he pushes forward with his own priorities At the outset of his presidency Jokowi’s lack of experience in managing the complex dynamics of national politics and its many powerful players seemed to be a critical weakness in his leadership. A year on, partly by relying heavily on his more capable ministers, Jokowi seems to have found a way to better manoeuvre around opposition to reform efforts, and to act more independently from vested interests, including in his own coalition.
Setting the Tone on Corruption
A recent example was the high-profile scandal that erupted in November when Energy and Mineral Resources Minister Sudirman Said released a recording of House of Representatives (DPR) Speaker Setya Novanto demanding a 20 percent stake in the mining giant Freeport Indonesia, in exchange for securing the company an extension of its mining contract. Novanto was subsequently investigated by the DPR’s Ethics Council (MKD).
President Jokowi’s role in this case was remarkably well-managed – he allowed Sudirman to serve as the figurehead for the crusade, but was not a silent observer either. Jokowi publicly criticised Setya for using the President’s name in the attempted shake-down, and called for law enforcement to pursue the case. In a landmark moment for Indonesian politics, Setya resigned from as Speaker after it became clear that most MKD members favoured his removal. This represents a clear break with the past where political leaders have shied away from taking on the powerful and deeply entrenched political and economic interests in Indonesia’s energy and resource sector, out of concern it would trigger an expanding circle of embarrassing revelations.
Jokowi’s distinct leadership style can also be seen in the evolving economic policy agenda. Since September his administration has launched a series of economic reforms to stimulate growth and further improve the business environment. Once again, Jokowi’s public role in this initiative has been minimal. The President announced the first policy package but has since said little on why his administration is putting so much effort into a deregulation campaign, or how this campaign fits into his broader economic agenda. Investors have reacted positively to the deregulation initiatives, though doubts remain over Jokowi’s commitment to the process.
Perhaps Jokowi’s sharpest departure to date from Yudhoyono’s second-term shift to economic nationalism was his late October announcement in Washington, DC that Indonesia intended to join the Trans-Pacific Partnership (TPP). While actual TPP membership is at best years into the future, the announcement itself has helped bolster the impetus at home for further deregulation and market liberalisation.
Most importantly, joining the TPP signals a change of mind-set – or, in Jokowi terminology, a revolusi mental – from an inward-looking, protectionist policy stance to a more open and outwardlooking Indonesia, confident about its place in the world. It reflects Jokowi’s recognition that Indonesia’s long-term growth can only be secured by boosting competitiveness and productivity, combined with more, not less integration with the international economy.
As he has done with Minister Said in the energy arena, Jokowi has relied heavily on his recently appointed Trade Minister Thomas Lembong to explain his thinking. Thomas has risen to the task, unapologetically using language to communicate a free trade stance that is almost impossible to imagine being uttered by any of his recent predecessors. Similar path-breaking reforms are being pursued by Marine Affairs and Fisheries Minister Susi Pudjiastuti and Communications and Information Minister Rudiantara, both of whom enjoy strong support from Jokowi.
Below the radar in 2015 to On the Radar in 2016?
But while Jokowi’s leadership by proxy style is beginning to shape a promising policy agenda, it is not without risks. Looking ahead for this year 2016, President Jokowi will have to carefully balance his below-the-radar instincts with ensuring that the voter knows where he stands and that his ministers are doing his bidding, not the other way around.
His administration will also need to invest more in communicating its policies and accomplishments. The Jokowi administration has consistently seen reforms fail to resonate with wider audiences due to a lack of clear communication with both domestic and international audiences. Partly this is due to an inexperienced band of advisors in senior roles in the Presidential Office, and partly it reflects Jokowi’s unstructured, ad hoc style. Either way, the administration’s poor communications represents a political missed opportunity that Jokowi can ill afford.
Jokowi himself will have to play a central role in this effort. He will need to more clearly own and communicate his agenda if he is to convince skeptical constituencies that he is committed to delivering and not just talking about reform. The public, and in particular the business community, is all too familiar with Indonesian presidents who begin their terms with reformist energy only to be stymied and slowed by vested interests.
Finally, and perhaps most importantly, Jokowi will need to avoid the political deal-making temptations which have neutered the reformist energy of several of his predecessors. Trading key cabinet seats to political party representatives with little if any relevant experience and little or no loyalty to the president has proven in the past to be at best a short-term palliative, but in the long-term fatal to producing a coherent and effective policy agenda. Jokowi will need to trust his famed people instincts to avoid the same fate befalling him.
This article was written by Adam Schwarz, CEO of Asia Group Advisors, a Singapore-based advisory firm, and reproduced here with their kind permission. An earlier version of the article was published on The Jakarta Post.