JAKARTA—Indonesian president Susilo Bambang
Yudhoyono still has a long "to do" list for his remaining two years
in office.
During
Mr. Yudhoyono's more than seven years as president, Indonesia has proven it has
a stable democracy and can record some of the highest economic growth in the
world. Mr. Yudhoyono hopes he has set the stage for more stability, growth and
democracy at home and in the region.
"By
the time I leave my office, I wish that democracy, which has taken root in
Indonesia, will continue to strengthen and improve," the two-term
president said in a written response to some questions from the Wall Street
Journal.
Mr.
Yudhoyono's answers outlined the direction and tone he wants to take as he
leads Southeast Asia's largest economy until elections scheduled for 2014.
Among
the other areas in which Mr. Yudhoyono expects progress are: boosting average
incomes, limiting corruption, improving governance and building infrastructure,
all of which are expected to become key issues during the election.
Whether
Mr. Yudhoyono and his Democratic Party can help the country evolve and grow
over the next two years will help decide whether Indonesia becomes the next big
Asian economic miracle or its next failure that overheats and flops.
Despite
the global slowdown and troubles in Europe today, Indonesia, whose growth has
outpaced India the last two quarters, is expected to expand more than 6% this
year.
"As
Indonesia aims to lift its per capita income from around $3,000 (per year)
today to more than $14,000 in 2025, I hope that I will have built a strong
enough foundation for accomplishing this objective," he said.
Below
is the full text of the questions and answers:
The Wall Street Journal: As President
Yudhoyono wraps up his second and final term in office, what legacy does he
want to leave for the Republic of Indonesia?
Susilo Bambang Yudhoyono: By the time I leave
my office, I wish that democracy, which has taken root in Indonesia, will
continue to strengthen and improve. Hopefully, this will also be accompanied
with the further strengthening of governance, upholding of the rule of law, and
eradication of corruption.
On the
economic and development side, I hope that the pro-growth, pro-poor, pro-job,
and pro-environment strategy will create more tangible results. I also hope
that Indonesia makes more progress in achieving the Millennium Development
Goals.
As
Indonesia aims to lift its per capita income from around $3,000 today to more
than $14,000 in 2025, I hope that I will have built a strong enough foundation
for accomplishing this objective. With this level of income, and having more
than a quarter billion of population, Indonesia will need more products and
services, including from other countries.
I would
like to see that all these would contribute to the maintenance of peace and
stability in Indonesia, and to greater prosperity of its people.
Of
course, I have strong hope that as I complete my term, Indonesia's contribution
to the realization of ASEAN Community will become more evident. We did a lot of
things to ensure progress in achieving the ASEAN Community during our
chairmanship in ASEAN in 2011.
WSJ: As Indonesia continues to raise its global
profile, how does it want to be understood and what does it have to contribute
to global geopolitical discussions?
Mr. Yudhoyono: Indonesia wants the
global community to understand that we are a net contributor to the global
peace and security. Indonesia is one of the largest troop contributing
countries to the U.N. peace missions. Now we are aiming for 4,000 personnel
target within those missions. Through global forums such as the U.N. and NAM
[Non-Aligned Movement], we have been active to promote disarmament and
non-proliferation.
We
would also like the global community to understand that we are in the
mainstream of the efforts to promote strong, balance, inclusive, and
sustainable global growth. Through forums such as G20 and APEC, Indonesia has
advocating this objective. And as a developing country, Indonesia seeks to
raise issues on development and financial inclusion in the G20 forum. I believe
that it is in the interest of all developing countries to have a strong,
sustainable, balanced, and inclusive economic growth.
Coming
from a disaster-prone country, I have been championing disaster awareness in
international forums. Also, having the fifth-largest population in the world,
with over 230 million inhabitants, Indonesia seeks to raise global awareness of
the importance of food and energy security. The issue of food and energy
security affects everyone in this world, as we face the pressing challenge of
balancing the rapid growth of population and the soaring need for food and
energy. It is the common, but differentiated responsibility of all nations to
address this issue and others related to it, such as climate change and
environmental protection.
WSJ: How is the recent rush of international
trade and investing changing the country?
Mr. Yudhoyono: I must say that
both international trade and investment have changed the dynamic of Indonesia's
economy positively. For this reason, in various meetings that I have had with
world and business leaders, I always encourage closer cooperation in these
areas.
Although
international trade is not necessarily the main drive of our growing economy,
it remains as one of the main contributors. I am pleased to share with you that
our total trade value with the world continues to increase. To give some
numbers, from 2010-2011, our export value has increased by 30% from $157.8
billion to $203.5 billion. Following such a trend, our import has increased by
31% during the same period, from $135.66 billion to $177.43 billion.
For our
domestic industry, this trend of international trade has opened up new markets
and export destinations for Indonesian abroad. Nevertheless, at the same time,
it also opens up Indonesia for foreign products. This challenges our domestic
industry to remain competitive by being innovative, creative, and efficient.
They have to uplift their capabilities to be on par with other global players.
For
Indonesian consumers, the international trade gives them more choices in terms
of products, be it in terms of quality or price. Surely this benefits the
consumers. To ensure consumer safety, the government has the obligation to
monitor and supervise the products circulating within the country.
With
regards to investment, the total inflow of foreign direct investment into
Indonesia has increased quite significantly by 20% from 2010 to 2011, from
US$16.21 billion to US$19.47 billion. It is contributing to our economic
development and produces spill-over benefits, such as providing more employment
opportunities, and allowing transfer of technology.
To
ensure more organized and evenly distributed FDI, I have also initiated the
Master Plan for Acceleration and Expansion of Indonesian Economy
("MP3EI") in 2011. With it, Indonesia seeks to elevate its global
economic performance by 2025. Through the master plan, we can better inform
both foreign as well as domestic investors about investment opportunities in
various sectors.
Many
economic observers have identified infrastructure as a challenge to the growth
of our economy. Thus, infrastructure projects have been included as one of the
main prioritized sectors in MP3EI. We have lots of infrastructure projects, and
I invite investors to play a role in them. This way, investment can better
contribute to our economy, and investors will also be mutually benefited.
Indonesia
also endeavors to "make life easier for investors": I have told my
officials that we can no longer do business as usual. We seek to create a more
conducive investment climate and address the inefficiency. For that, Indonesia
has taken some measures to conduct serious bureaucratic reforms and streamline
the process to start business in the country.
WSJ: What has Indonesia's evolution over the
last decade taught the world about the process of becoming a democracy?
Mr. Yudhoyono: First lesson from
our experiences in democratic transition is that democratization should be
inclusive. It respects different perspectives and interests and involves
various stakeholders.
Second,
democratization needs patience and sustained commitment. Government and also
the people of Indonesia have to adapt to a system that is based on democratic
values. We all must embrace the diversity in expression as they are allowed
under the principles of freedom of speech and freedom of association.
I
personally have a strong commitment to democracy. I believe in it, and I
believe that there must be a limit in power and duration for whomever holds a
position of power. Power tends to corrupt; absolute power corrupts absolutely.
So, like our experience after the crisis, we changed our constitution to limit
the terms of presidency by two terms only.
Third,
in the case of Indonesia, Islam and democracy can go hand-in-hand. Indonesia is
the largest Muslim population in the world, but we are not an Islamic state. We
have shown that Islam, democracy, and modernity can live together in harmony.
Lastly,
there is no single model for democracy. Democracy must be home-grown and
tailored to the needs of the respective countries. Indonesia's experience in
democratization is its own, safe the best practices that we can share with the
world, and vice versa.
WSJ: What is being done to address concerns that
confusing regulations and corruption continue to make it difficult for both
local and international companies to invest more in Indonesia?
Mr. Yudhoyono: First of all, I
believe that the battle against corruption cannot be done as easily as turning
your hand. And this is not an issue unique to Indonesia, but also evident in
many other countries.
My
government is determined and committed to eradicate corruption in this country.
Therefore, I fully support the work of the Corruption Eradication Commission.
Previously, we have seen increasing number of cases being handled by the
commission, more people brought to justice, and also more people being charged
for their wrong doings. This is simply unprecedented. It is also noteworthy
that in respecting the principle of equality before the law, even high-ranking
government officials have been charged as they were proven guilty. Recently,
the commission has even detained a foreigner accused of bribery. I believe
strict legal enforcement in this area is crucial to ensure complete eradication
of corruption.
Additionally,
for companies, I encourage them not to get involved in bribery or corruption.
There is a proper legal procedure for conducting business, and if they
encounter bribery or corruption, we also have a whistleblower system to report
to the authorities.
With
regards to regulations in Indonesia, government officials are obliged to
disseminate the regulations to the public and also provide information when
being requested by the public. If there is any confusing regulation, companies
should not hesitate to consult with the relevant government officials. The
dynamic development in the country also requires us to reformulate some
regulations, also in the spirit of de-bottlenecking and streamlining. This
could get confusing especially for older investors. Therefore, please bear with
us because we are working towards the direction of ensuring clear and
unambiguous regulations for companies. It is all done in the interest of the
welfare and prosperity of the people of Indonesia.
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