Indonesia Political Risk Analyst

Kevin O’Rourke

Reformasi

Thematic (Sector/Industry)

Politics: By making Islamic Clerics Council (MUI) Chair Ma’ruf Amin as his running mate, President Joko Widodo has blundered, making the worst possible choice among the alternatives considered.  Amin holds a top post in Nahdlatul Ulama (NU), an organization that generally upholds tolerance – but the career politician is a staunch conserva­tive.  Last year he was the chief blasphemy accuser of the Jakarta governor at the time, Basuki Purnama (‘Ahok’).  Widodo’s choice will almost certainly make the election closer than it would have been otherwise: Amin’s record will likely alienate many minorities and dampen enthusiasm for the ticket among some moderates.  Widodo aims to appease Islamist elements, but placing Amin in high office will only strain tensions, while elevating the country‑risk profile and significantly exacerbating concern about elite‑led ‘Islamicization’.  Policymaking in a second Widodo administration will likely deteriorate further, as may international engagement.  Justifying commitments to invest will be more difficult, which is bearish for the currency.  To be sure, the office of vice president (VP) lacks hard power – but it entails ‘soft power’, which Amin manipulates adroitly.  At age 75, and devoid of popularity, he lacks presidential prospects in 2024, but as VP he can bolster Islamic groups and perhaps give some other religious conservative a chance to succeed Widodo (Page 2).  Against expectations, Prabowo rejected Agus Harimurti Yudhoyono (AHY) for his running mate and engaged a youthful tycoon, Vice Jakarta Governor Sandiaga Uno, who faces claims that he paid his nominators.  Uno may marginally boost the appeal of a Prabowo‑led ticket, especially as his demeanor contrasts with the septuagenarian cleric on Widodo’s ticket.  Uno resigned as vice governor and his Gerindra replacement may be Muhammad Taufik, a former corruption convict and vehement Purnama foe (p. 6). <table class="table table-striped"><tbody><tr><td>
Reformasi Weekly Review provides timely, relevant and independent analysis on Indonesian political and policy news. 
Delivered electronically every Friday, Reformasi Weekly is written by Kevin O’Rourke, author of the book Reformasi.
For subscription information please contact &lt;kevin.orourke@reformasi.info&gt;.
Reformasi Weekly is a product of PT Reformasi Info Sastra.
</td></tr></tbody></table>Justice: The Sukamiskin prison warden, a corruption suspect, admitted to graft (p. 9).Policy News: A long‑awaited regulation promises tax clarity for mining (p. 9).  The government intends to expand the use of subsidized biodiesel, but the intended benefits for the current account are questionable (p. 9).International: Indonesia faces a US$350 million annual fine from the World Trade Organization (WTO) for its non‑tariff barriers on agricultural imports (p. 10). Disasters: More than four days after a 7‑magnitude quake in Lombok, 21 communi­ties still lacked aid due to a slow logistics response from the central government (p. 11).

Politics: By making Islamic Clerics Council (MUI) Chair Ma’ruf Amin as his running mate, President Joko Widodo has blundered, making the worst possible choice among the alternatives considered.  Amin holds a top post in Nahdlatul Ulama (NU), an organization that generally upholds tolerance – but the career politician is a staunch conserva­tive.  Last year he was the chief blasphemy accuser of the Jakarta governor at the time, Basuki Purnama (‘Ahok’).  Widodo’s choice will almost certainly make the election closer than it would have been otherwise: Amin’s record will likely alienate many minorities and dampen enthusiasm for the ticket among some moderates.  Widodo aims to appease Islamist elements, but placing Amin in high office will only strain tensions, while elevating the country‑risk profile and significantly exacerbating concern about elite‑led ‘Islamicization’.  Policymaking in a second Widodo administration will likely deteriorate further, as may international engagement.  Justifying commitments to invest will be more difficult, which is bearish for the currency.  To be sure, the office of vice president (VP) lacks hard power – but it entails ‘soft power’, which Amin manipulates adroitly.  At age 75, and devoid of popularity, he lacks presidential prospects in 2024, but as VP he can bolster Islamic groups and perhaps give some other religious conservative a chance to succeed Widodo (Page 2).  Against expectations, Prabowo rejected Agus Harimurti Yudhoyono (AHY) for his running mate and engaged a youthful tycoon, Vice Jakarta Governor Sandiaga Uno, who faces claims that he paid his nominators.  Uno may marginally boost the appeal of a Prabowo‑led ticket, especially as his demeanor contrasts with the septuagenarian cleric on Widodo’s ticket.  Uno resigned as vice governor and his Gerindra replacement may be Muhammad Taufik, a former corruption convict and vehement Purnama foe (p. 6). 
Reformasi Weekly Review provides timely, relevant and independent analysis on Indonesian political and policy news. 
Delivered electronically every Friday, Reformasi Weekly is written by Kevin O’Rourke, author of the book Reformasi.
For subscription information please contact &lt;kevin.orourke@reformasi.info&gt;.
Reformasi Weekly is a product of PT Reformasi Info Sastra.
Justice: The Sukamiskin prison warden, a corruption suspect, admitted to graft (p. 9).Policy News: A long‑awaited regulation promises tax clarity for mining (p. 9).  The government intends to expand the use of subsidized biodiesel, but the intended benefits for the current account are questionable (p. 9).International: Indonesia faces a US$350 million annual fine from the World Trade Organization (WTO) for its non‑tariff barriers on agricultural imports (p. 10). Disasters: More than four days after a 7‑magnitude quake in Lombok, 21 communi­ties still lacked aid due to a slow logistics response from the central government (p. 11).   

Indonesia Politics: VP Choice Clouds Outlook, Tightens Race, Bearish for IDR