What will Indonesia look like after Jokowi leaves?

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(Graphic: The Economist)

At home, his soft-spoken, folksy style has made Jokowi, as he is known, one of the world’s most beloved leaders. His approval rating hovers around 80% (see chart). Only Narendra Modi, the Prime Minister of India, comes close to the leaders of major countries. But even as Jokowi basks in his popularity, there is speculation about what his legacy will be and who will succeed him after he steps down next year.

When Jokowi became president in 2014, he was like no leader the country had ever seen: a furniture maker who grew up in a hut by the river, he had no ties to the military or a prominent family. He is most comfortable inquiring about the price of onions at a market or handing out T-shirts to the crowds that throng to catch a glimpse of him wherever he goes. He has revolutionized Indonesian politics by coupling a clever social media operation with a ruthless focus on economic growth. Yet three major uncertainties hang over his legacy: whether the Indonesian economy will continue to grow; whether his successor will maintain his policy; and whether the country can sustain a balancing act in a divided world.

Jokowi’s track record of economic growth is decent. Indonesia has been the fifth fastest growing economy of the world’s 30 largest economies since he came to power in 2014. GDP has since grown by a total of 43%. According to IMF projections, this pace could continue. The fund expects the country to be the group’s second-fastest growing economy over the next five years, making it the world’s thirteenth-largest economy by 2028, up from eighteenth in 2014.

Much of this is due to a huge boost to infrastructure. The fourth most populous country in the world consists of more than 13,000 islands, many of which lack basic services. Often depicted wearing a helmet, Jokowi built airports, ports, power plants and dams and built thousands of kilometers of roads and railways. He has used his popularity to win over the country’s political parties, state-owned companies and powerful tycoons.

His signature project, the construction of an entirely new capital in the jungles of Borneo, exemplifies this strategy – and highlights the uncertainty surrounding its continued success. Jokowi argues that this city, known as Nusantara, is essential because a quarter of Jakarta, the current capital, could be underwater by 2050. Critics say the $34 billion project, due to be completed by 2045, is unrealistic. The government says it will cover 20% of the expected costs, with the rest financed by domestic and foreign investors. But more than four years after the project was announced, no foreign lender has signed a binding contract to finance the city.

Jokowi has had better luck getting foreigners to back other projects. Foreign direct investment rose to $45 billion in 2022, an increase of 44% from the previous year. Much of this investment comes from China and flows into nickel mining and processing. Indonesia has the world’s largest metal reserves, which are essential for the production of batteries for electric vehicles. In 2014, Indonesia banned the export of unprocessed nickel. With little choice to go elsewhere, foreign mining companies, many of them Chinese, built large processing facilities in Indonesia. This stimulated growth and new jobs, albeit at the expense of the environment. Indonesia exported more than $30 billion worth of nickel products last year, 10% of total exports and ten times more than in 2013.

The future of this strategy is uncertain. The government wants to encourage an expansion from onshore nickel processing to the production of battery precursors and even electric vehicles, a much more difficult and complex task that will fall on the shoulders of Jokowi’s successor should he choose to pursue it. It doesn’t help that Jokowi’s government has moved toward “a more interventionist and less market-oriented style,” says Tom Lembong, Minister of Trade and Investment in the early years of Jokowi’s government.

Jokowi’s focus on infrastructure has also complicated Indonesia’s geopolitical position. It has brought the country, which traditionally pursued a non-aligned foreign policy, closer to China. According to the Indonesian Investment Coordinating Board, Chinese investments amounted to more than $8 billion in 2022, four times more than America’s. The share of the country’s exports going to China and Hong Kong has risen from 12% in 2014 to 22% in 2022. Jokowi has copied China’s reliance on infrastructure, debt financing and state-owned enterprises, Lembong says.

Economic dependence on China has limited Indonesia’s geopolitical room for maneuver. Despite being the world’s largest Muslim-majority country, Indonesia has remained silent on the persecution of the Uighurs, a predominantly Muslim ethnic group originating from China’s Xinjiang region, for fear of economic fallout.

Jokowi has tried to hedge his bets by strengthening security and economic ties with America and its allies. In terms of security, it has avoided Chinese dependence. The largest suppliers of military equipment to Indonesia are South Korea, America and France, according to the Stockholm International Peace Research Institute, thanking them.

Yet building economic ties with America has proven more difficult. Indonesia really wants a trade deal with America that includes metals, so that it becomes cheaper to sell Indonesian nickel in America and be less dependent on China. But the U.S. government is concerned about China’s dominance of Indonesia’s nickel industry, so a deal remains elusive.

Despite these concerns, Jokowi’s focus has proven popular. “The vast majority of Indonesian elites admire China,” says Lembong. “They think Western democracies are decadent, in decline, messy and slow.” Most Indonesians, on the other hand, view their president as a man who gets things done. As mayor, Jokowi became famous for his blusukan, a Javanese word for impromptu neighborhood visits that allowed him to connect with voters and learn firsthand about their problems. He continued these visits after he became president.

A Democrat – to a point

But as he approaches his final year as president, Jokowi’s democratic credentials are eroding. He has rolled back liberal laws and weakened the anti-corruption commission, which is bad news for solving Indonesia’s persistent cronyism. And perhaps he will lay the foundation for his own dynasty, just like some politicians before him. In his autobiography, published in 2019, Jokowi stated that “becoming president does not mean channeling power to my children.” But just after winning re-election in 2019, his eldest son Gibran Rakabuming became mayor of Solo, Jokowi’s former post. son-in-law Bobby Nasution is mayor of Medan, the fifth largest city in Indonesia. Kaesang Pangarep, his youngest son, also wants to enter politics.

Indonesia’s constitutional court (whose chief justice is Jokowi’s brother-in-law) can lower the age of vice-presidential candidates from 40 to 35; Mr. Gibran will be 36 when the nominations are in. With presidential elections scheduled for February, Gibran could be seen as a potential running mate, someone who comes with his father’s approval. However, that is no guarantee for continuity. Defense Minister Prabowo Subianto, an authoritarian military officer, is neck-and-neck in the polls with Ganjar Pranowo, the governor of Central Java and a member of Jokowi’s party.

Mr Prabowo, who has lost to Jokowi twice before, looks like a return to the bad old days. He is accused of allowing human rights violations in East Timor in the 1980s, which he strongly denies. He emphasizes his nationalism, advocates food autarky and has criticized Indonesia’s practice of direct elections. Mr Ganjar has just appointed the head of the Indonesian Chamber of Commerce, a respected businessman, as his campaign chairman, suggesting he may be more serious than Mr Prabowo when it comes to economic reform.

A third possible candidate is Anies Baswedan, the former governor of Jakarta and former education minister in Jokowi’s cabinet, who is far behind Mr Ganjar and Mr Prabowo in the polls. Viewed as an underdog, Mr Anies lost the first round of the Jakarta governor’s race in 2017 before squeaking out a victory in the second round, backed by conservative Muslim voters. He recently won the support of the country’s largest Islamic civil society organization, a key voting bloc, opening the possibility of a three-way race.

Both leaders, eager to curry favor with Jokowi, say they will maintain his policies, including the export ban on raw materials and the build-up of new capital. Yet Indonesia’s elections are more about personalities than policy, argues Ben Bland, Jokowi’s biographer. That means no candidate will win with proposals on how to boost economic growth and provide better services. An endorsement from Jokowi would help any candidate. But it won’t guarantee that the winner will keep his legacy.

Correction (September 11): An earlier version of this article stated that only Narendra Modi, the Prime Minister of India, comes close to Jokowi’s popularity. But there are leaders in smaller countries, like the president of El Salvador, Nayib Bukele, which have consistently achieved higher approval ratings. We have adjusted the text to reflect this.