By Clint Richards
Indonesia needs an investment and security partner to assert itself in Southeast Asia.
Despite the fact that he still faces a stiff challenge to his victory from rival candidate Prabowo Subianto, Indonesian president-elect Joko Widodo has begun to make sweeping foreign policy statements, suggesting the direction his government is likely to take in seeking investments and alliances. Two interviews he gave with Japanese news outlets this week show an eagerness to partner with Japan in investment, but also shows Indonesia’s neighbors in Southeast Asia which direction Joko could take on territorial issues and regional security in general. He was careful to portray Indonesia as an international arbiter, and thus seemingly above the fray of regional disputes. Should Joko become president in October, following such a narrow diplomatic path in the South China Sea will be difficult. However, choosing a significant ally from outside the region to help balance against China would help to give Indonesia’s position additional weight.
A large portion of the interviews Joko gave to the Asahi Shimbun and Kyodo News were focused on his interest in attracting new Japanese investment to Indonesia. Speaking in Jakarta, he told Kyodo News that Japan was his country’s oldest partner, with bilateral trade reaching $46 billion. Joko spoke with Japanese Prime Minister Shinzo Abe shortly after Indonesia’s presidential election results were announced, saying he intended to visit Japan soon and that “Indonesia needs investments in the fields of infrastructure, energy and industrialization.” In his interview with the Asahi Shimbun, Joko also said “Japan has been an important partner for more than 50 years. I hope that the (bilateral) relations will become closer.”
Infrastructure is a main target for future investment according to Joko, who despite anti-foreign investment statements during his campaign has said that country’s investment climate now should be “more conducive for the private sector to channel more investment into infrastructure.” Specifically, he is looking for maritime investment to improve island connectivity and deep sea ports, as well as double-track railways. Partnering with Japan is in line with Indonesia’s investment strategy of moving away from extractive industries into sectors higher up the production chain, as Japan’s consumer-based companies have already begun shifting large portions of their production overseas to Southeast Asia. Likewise, Japan has a significant maritime and port facility industry, and its construction companies have a reputation for building resilient infrastructure projects able to withstand substantial earthquakes, which both countries are prone to.
Joko did not mention seeking any larger security or strategic alliance with Japan. When asked, he said “It is important to make bilateral cooperation to build peace and prosperity,” and that “from now on, we will examine concrete measures for cooperation.” When asked about the Japanese Cabinet’s new interpretation of collective self-defense, he responded by saying “I don’t know, but for me soft diplomacy is more important.”
Read the full story at The Diplomat