Can Indonesia Lead ASEAN Under Jokowi?

On October 20, Indonesia, the world’s fourth largest nation and the biggest country in Southeast Asia, inaugurated Joko Widodo – popularly known as Jokowi – as its seventh president after a decade of leadership under Susilo Bambang Yudhoyono. Aside from tackling a wide array of domestic challenges, Jokowi will be expected to continue Indonesia’s traditional role as a regional leader in Southeast Asia and the Association of Southeast Asian Nations (ASEAN). 

As Southeast Asia’s largest state and one of the four original founding members of ASEAN when it was created in 1967, Indonesia has long been regarded as primus inter pares within the regional grouping. But following the Asian financial crisis in 1997 and the overthrow of longtime autocrat Suharto, the country turned inward amid fears of impending Balkanization. Indonesia managed to recapture its leadership position in ASEAN under Yudhoyono by advancing the bloc’s role within Asian regionalism, mediating and facilitating conflict resolution, and promoting democracy and human rights. Many in the region are now looking to Jokowi to sustain this active foreign policy. However, to be an effective leader in ASEAN on economic, security, and democracy and human rights issues, Jokowi must first navigate a range of obstacles at home and abroad in each of these three realms. 

In the economic realm, Indonesia’s leadership will be essential for the region since it accounts for roughly 40 percent of Southeast Asia’s $2.1 trillion economy. This will be especially true in 2015 as ASEAN moves towards completing an integrated ASEAN Economic Community (AEC) and a mammoth free trade agreement with Australia, China, India, Japan, South Korea and New Zealand known as the Regional Comprehensive Economic Partnership (RCEP).  

Indonesia’s large market size, favorable demographics, strong domestic demand, and significant natural resource endowments all suggest that it has much to gain from a single ASEAN market and regional economic integration more generally. Yet to fully embrace the AEC and effectively compete within it, Jokowi will need to address the country’s structural deficiencies, such as its poor infrastructure, Byzantine bureaucracy, and rigid labor market, all of which continue to stifle growth and spook foreign investors. His administration must also resist giving in to protectionist impulses driven by growing fears among domestic businesses of rising competition from their ASEAN counterparts. 

Security-wise, Indonesia has played a crucial role in helping manage some of the key flashpoints in Southeast Asia over the past few years, from a fierce temple dispute between Thailand and Cambodia to ongoing tensions in the South China Sea that pit four Southeast Asian claimants – Brunei, Malaysia, the Philippines and Vietnam – against China. Yudhoyono and his foreign minister Marty Natalegawa proposed a bold idea of a “dynamic equilibrium” for the Asia-Pacific to replace the traditional, adversarial “balance of power concept.” Under this new vision, ASEAN countries would work with others to build mechanisms to ensure that no power is dominant or excluded, and all parties would strive for common security despite trust deficits. 

While some expect Indonesia’s leadership in this sphere to continue under Jokowi, sustaining it will not be without its challenges. To some, China’s continued assertiveness at sea and America’s rebalance to Asia suggest that balance-of-power politics is here to stay. Indonesia’s ASEAN brethren will also look to see how Jokowi manages Indonesia’s disputes with its neighbors, including border disagreements with Malaysia and the annual air pollution hazard in Singapore and Malaysia caused by raging Indonesian forest fires. Meanwhile, at home, despite recent advances, Indonesia’s paltry defense budget and incoherent strategic doctrine continue to impose severe constraints on its military modernization, with one minister admitting recently that the country was not able to control its own territorial waters. Needless to say, these grim realities risk limiting both the strength and credibility of Indonesia’s regional activism.  

With respect to democracy and human rights, the fact that Indonesia completed the first peaceful transfer of power between two popularly elected leaders is a boost not only for the world’s third largest democracy, but for a wider region where such transfers are becoming increasingly rare. The deepening of Indonesia’s democracy at home also opens the door for Jokowi to enhance Indonesia’s “soft power” abroad, be it through sharing experiences annually with Asian countries at the Bali Democracy Forum which Jakarta hosts or cooperating with other democracies like the United States to promote good governance in Myanmar. 

But domestic setbacks for Indonesia’s democracy during Jokowi’s tenure could erode its “soft power” abroad. Even before Jokowi’s inauguration, his opponents in Indonesian parliament pushed a bill to end direct local elections on September 26, effectively sending the country back to the Suharto era. As a result, outgoing president Yudhoyono embarrassingly had to spend a significant part of his remarks at the Bali Democracy Forum weeks later defending his country’s own democratic record. More challenges could be lying in wait for Jokowi in this realm, including pressure from hardline Islamic groups to curtail the rights and freedoms of minority Ahmadiyah, Shite and Christian communities in the world’s biggest Muslim-majority nation.

Beyond these three realms, Indonesia under Jokowi may also encounter more general challenges as it tries to lead ASEAN. Some fear that Jokowi’s foreign policy inexperience will lead him to delegate foreign policy issues to his advisers, producing internal divisions that could in turn undermine Indonesia’s effectiveness as a regional leader. For instance, while Jokowi’s foreign minister Retno Marsudi said in her first press briefing that Indonesia will push maritime cooperation with neighboring states in upcoming regional fora, it remains to be seen whether she can maintain Jakarta’s unified position on the South China Sea amid potential disagreements with more military-oriented advisers or interests.

Renowned Indonesian scholar Dewi Fortuna Anwar argued two decades ago that ASEAN was a “cornerstone” of Indonesian foreign policy, and that has remained the case through the Yudhoyono years. But Jakarta’s leadership of ASEAN is not guaranteed, and as in the past, there is a risk that Indonesia could either be distracted by domestic concerns or frustrated with the slow pace of regionalism and the looming threat of great power rivalry. To mitigate this risk and lead ASEAN effectively over the next few years, Jokowi will need to navigate past a range of formidable challenges in multiple realms.