Indonesia Political Risk Analyst

Kevin O’Rourke

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

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On the preparation for an ambitious reform project, the Job Creation Omnibus Bill, anticipated union protests proved anemic on 20 Jan and parliamentarians appear ready to act on the measure -- but the government still has yet to submit the text to the legislature.  In the Jiwasraya scandal, the president apparently dissuaded parliament from conducting a Special Commission (pansus) probe, opting instead for lower-level working commissions (panjas).  This suggests that full accountability may remain lacking.  Incarceration of a US journalist for a visa infraction exacerbates Indonesia's relatively poor record on press freedom.Politics: Labor-union turnout to protest President Widodo’s planned omnibus reform bills proved anemic.  This may enable the government to skirt a hurdle to the passage of the bills – at least for now.  But policymakers have yet to submit drafts of the bills to parliament, highlighting the technical complexities and, especially, the conflicting vested interests at play (Page 2).  A meeting with the president persuaded parliamentary leaders to probe the Jiwasraya scandal with low‑level working committees (panjas), rather than an investigative special committee (pansus).  An opposition parliamentarian denounced the decision, citing signs that perpetrators include figures “close to the center of power” (p. 4).   In yet another instance during the Widodo era, authorities placed a foreign journalist in custody for a visa infraction.  The episode exacerbates Indonesia’s already‑problematic credentials on press freedom (p. 5).Electoral System: Controversy about an unauthenticated draft of the Job‑Creation Omnibus Bill, regarding a stipulation empowering the president to sack governors, prompted Home Affairs Minister Tito Karnavian to point out that such power already exists, in the overlooked 2014 Regional Governance Law.  His stance elevates anticipation that the administration harbors plans to impose controls over regional heads (p. 6). Justice: Law Minister Yasonna Laoly is adamant that a suspect in the General Election Commission (KPU) bribery case, his party colleague Harun Masiku, was a fugitive abroad – until investigative reporting compelled authorities to admit that he is in fact in Indonesia.  Opposition figures are calling for Laoly’s dismissal and his prosecution for obstructing justice (p. 8).  Investigators in the Jiwasraya case interrogated additional witnesses from capital-markets firms, but without naming new suspects (p. 9).Policy News: Parliamentarians agreed to include three omnibus bills in the 2020 legislative docket – even though the government has yet to deliver the items to the legislature.  The circumstance suggests that the pro‑Widodo parliament may be amenable to passing the measures with relative ease, when they finally arrive (p. 9).Infrastructure: For the second time in six months, the president reviewed efforts to transform Labuan Bajo, Flores into a premier tourism zone and G-20 summit site (p. 10).Health: No coronavirus cases exist in Indonesia, yet (p. 10).Jakarta: The governor faces a deluge of criticism for paving over a wooded section of the National Monument (Monas) to make more room for mass gatherings (p. 11).

On the preparation for an ambitious reform project, the Job Creation Omnibus Bill, anticipated union protests proved anemic on 20 Jan and parliamentarians appear ready to act on the measure -- but the government still has yet to submit the text to the legislature.  In the Jiwasraya scandal, the president apparently dissuaded parliament from conducting a Special Commission (pansus) probe, opting instead for lower-level working commissions (panjas).  This suggests that full accountability may remain lacking.  Incarceration of a US journalist for a visa infraction exacerbates Indonesia's relatively poor record on press freedom.Politics: Labor-union turnout to protest President Widodo’s planned omnibus reform bills proved anemic.  This may enable the government to skirt a hurdle to the passage of the bills – at least for now.  But policymakers have yet to submit drafts of the bills to parliament, highlighting the technical complexities and, especially, the conflicting vested interests at play (Page 2).  A meeting with the president persuaded parliamentary leaders to probe the Jiwasraya scandal with low‑level working committees (panjas), rather than an investigative special committee (pansus).  An opposition parliamentarian denounced the decision, citing signs that perpetrators include figures “close to the center of power” (p. 4).   In yet another instance during the Widodo era, authorities placed a foreign journalist in custody for a visa infraction.  The episode exacerbates Indonesia’s already‑problematic credentials on press freedom (p. 5).Electoral System: Controversy about an unauthenticated draft of the Job‑Creation Omnibus Bill, regarding a stipulation empowering the president to sack governors, prompted Home Affairs Minister Tito Karnavian to point out that such power already exists, in the overlooked 2014 Regional Governance Law.  His stance elevates anticipation that the administration harbors plans to impose controls over regional heads (p. 6). Justice: Law Minister Yasonna Laoly is adamant that a suspect in the General Election Commission (KPU) bribery case, his party colleague Harun Masiku, was a fugitive abroad – until investigative reporting compelled authorities to admit that he is in fact in Indonesia.  Opposition figures are calling for Laoly’s dismissal and his prosecution for obstructing justice (p. 8).  Investigators in the Jiwasraya case interrogated additional witnesses from capital-markets firms, but without naming new suspects (p. 9).Policy News: Parliamentarians agreed to include three omnibus bills in the 2020 legislative docket – even though the government has yet to deliver the items to the legislature.  The circumstance suggests that the pro‑Widodo parliament may be amenable to passing the measures with relative ease, when they finally arrive (p. 9).Infrastructure: For the second time in six months, the president reviewed efforts to transform Labuan Bajo, Flores into a premier tourism zone and G-20 summit site (p. 10).Health: No coronavirus cases exist in Indonesia, yet (p. 10).Jakarta: The governor faces a deluge of criticism for paving over a wooded section of the National Monument (Monas) to make more room for mass gatherings (p. 11).

Open Omnibus Path, but for Bills / DPR Dissuaded from Jiwasraya Probe / US Journalist Detained