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Indonesia: Country Report
Politics:
Indonesia, also known as the Republic of Indonesia, gained
independence on August 17, 1945. Indonesia consists of thousands of
islands with approximately 246,000,000 residents. An executive authority is
vested in the President, and is advised by the Supreme Advisory Council and
elected by the people. The President is both the Chief of State and the head
of the government. The People’s Consultative Assembly (MPR) has the
highest authority within the government. The MPR consists of the House of
Representatives (DPR) and House of Regional Representatives (DPD). The
MPR has the power to amend the constitution, and inaugurate and impeach
the President. The House of Representatives devise legislation on a national
realm.1
During the Second World War, the Japanese occupied the Dutch East
Indies from 1942 to 1945 after the Dutch army surrendered in March 1942.
In 1945, the Japanese surrendered to the Allied Forces, and the national
leaders proclaimed Indonesia’s independence. However, the independence
did not occur over night. It took another four years for the Netherlands to
transfer sovereignty. Indonesia had numerous political conflicts along with
an economic collapse from 1950 to mid-1960. 2 Sukarno was the first
Indonesian president and presided over Indonesia for approximately 17
years (the years are subjective since some proclaim he governed Indonesia
from 1945-1967 while others say 1949-1967). 3 Although Sukarno was
phenomenal at language and rhetoric, he led the Indonesian economy to a
brink of failure. Today, Joko Widodo is the president and the incumbent of
Indonesia. Indonesia is currently the third largest democracy in the world
after four decades of authoritarian rule.
1
"Indonesia." CIA. Central Intelligence Agency, n.d. Web. 14 June 2012. <https://www.cia.gov/library/publications/the-worldfactbook/geos/id.html>.
2
Ibid.
3
"The Sukarno Era of Indonesian History." The Sukarno Era of Indonesian History. N.p., n.d. Web. 14 June 2012.
<http://www.sjsu.edu/faculty/watkins/indonesia1.htm>.
Economic Indicators:
 The GDP per capita and GDP real growth has grown expeditiously within
the past few years. Former President Yudhoyono established economic
reforms to boost Indonesia’s economy. Yudhoyono introduced reforms in
the financial sector, including tax and custom reforms, the use of
Treasury bills, and capital market development.4
 Indonesia has the strongest economy in Southeast Asia; however, there
are still issues with its unemployment rate, inadequate infrastructures,
piracy, and unequal resource distribution.5
Economic Structure:
 The GDP per capita in
Indonesia as of 2014
is $10,200 (est)
 The economic
structure comprises
of agriculture,
manufacturing and
services sectors for
growth. Agriculture
accounts for 14.9 per
cent of Indonesia’s
overall GDP, while 46
per cent from
industry, and 39.1
per cent from services.
 The unemployment
rate as of 2014 was
5.7%, and has been steadily decreasing over the years.
Social Issues:
 Religion: Indonesia is predominately Muslim—Muslim 86.5%, Protestant
5.7%, Roman Catholic 3%, Hindu 1.8%, other or unspecified 3.4%.6
 Jihadists: Indonesia faced its first suicide bombing in 2001. There have
been several suicide bombings within the country since then. As a result,
Yudhoyono increased its security with intensive surveillance on Islamic
4
"Indonesia." CIA. Central Intelligence Agency, n.d. Web. 14 June 2012. <https://www.cia.gov/library/publications/the-worldfactbook/geos/id.html>.
5
Indonesia Economic Structure." Indonesia Economic Structure. Economy Watch - Follow the Money, 15 Mar. 2010. Web. 14 June 2012.
<http://www.economywatch.com/world_economy/indonesia/structure-of-economy.html>.
6
"Indonesia." CIA. Central Intelligence Agency, n.d. Web. 14 June 2012. <https://www.cia.gov/library/publications/the-worldfactbook/geos/id.html>.
activists. The fundamentalist jihadist groups have implemented violent
acts among Christians and other Islamic sects.7
 Devastations and Employment: According to Economic Watch, natural
disasters, political and social conflicts, and terrorist attacks have led
Indonesia to economic changes within the past few decades. Due to these
devastations, many civilians have fleeted to neighboring countries such as
Malaysia. Yet in 2011, the employment rate increased.8
 Migrants from Myanmar: In May 2015, Indonesia and Malaysia jointly
agreed to take in 7,000 migrants from Myanmar and Bangladesh. The two
groups of migrants are seeking political asylum and better economic
conditions, respectivly, will be allowed to remain in the country for a year
before being repatriated or granted asylum in a third country. Indonesia
already has around 12,000 refugees in the country, and conditions in the
camps for the new wave of migrants are not ideal, however Indonesia has
been applauded for their fast action in establishing the camps, and it is
expected that they will continue to work to improve the migrants’ living
conditions.
Environmental Issues
 Environmental Hazards: The environmental hazards in Indonesia have
led to an influx of health risks. Air pollution in urban cities and food
contamination from industries and infrastructures is a major issue. The
forest fires in Indonesia are also a major contributor to the economic and
social effects in Indonesia.9
 Deforestation: The global demand for wood pulp and palm oil has
resulted in a loss of approximately 187 million ha forests a year. Not only
does this devastate the soil, but it also endangers species living within
the proximity. Deforestation has led to a loss of revenue for local and
central governments.10
Acknowledgements:
Research and Data Development provided by: Sara Rosenblatt and Corey Murano, Research
Assistant, under the supervision and coordination of Dr. Gerard J. Janco, President, Eurasia
Center/EBC.
7
Lane, Max. "Currents Undermining Indonesian Political Stability." Direct Action. Direct Action, Sept. 2011. Web. 15 June 2012.
<http://directaction.org.au/issue35/currents_undermining_indonesian_political_stability>.
8
"Indonesia Economic Structure." Indonesia Economic Structure. Economy Watch - Follow the Money, 15 Mar. 2010. Web. 14 June 2012.
<http://www.economywatch.com/world_economy/indonesia/structure-of-economy.html>.
9
"World Health Organization - Indonesia." World Health Organization - Indonesia. World Health Organization, n.d. Web. 14 June 2012.
<http://www.who.or.id/eng/strategy.asp?id=cs2>.
10
Edwards, Mark. "Environmental Problems in Indonesia." WWF. WWF Global, n.d. Web. 15 June 2012.
<http://wwf.panda.org/who_we_are/wwf_offices/indonesia/environmental_problems_indonesia/>.