{"id":8219,"date":"2024-12-16T19:34:04","date_gmt":"2024-12-16T19:34:04","guid":{"rendered":"https:\/\/aiccusa.org\/?p=8219"},"modified":"2026-04-08T17:41:00","modified_gmt":"2026-04-08T17:41:00","slug":"prabowos-first-days","status":"publish","type":"post","link":"https:\/\/aiccusa.org\/?p=8219","title":{"rendered":"Prabowo’s First Weeks"},"content":{"rendered":"

November 2024<\/strong><\/p>\n

\n

Commentary by Wayne Forrest<\/em><\/p>\n

President Prabowo began his Presidency mostly traveling outside of Indonesia, signaling the importance of repositioning the world\u2019s fourth largest nation in front of its major sources of trade and investment. On November 8, only 2 weeks after his inauguration the President headed first to China to meet Xi Jinping and then flew to Washington to meet President Biden. He also attended the APEC Summit in Peru and the G20 in Brazil, ending his sojourn with a visit to the United Kingdom.<\/p>\n

The contrast between his reception in China versus the US was stark: the Chinese showered Prabowo and his considerable business delegation with \u201chigh ceremony\u201d, including the trappings of a state visit as well as $10 billion of new investment pledges, whereas President Biden held a perfectly acceptable and friendly bilateral discussion in the Oval Office but offered few if any tangible deliverables. For example, no progress seems to have been made on something Indonesia clearly desires at minimal US cost, a critical minerals agreement. Prabowo\u2019s attempt to meet President-elect Trump failed; but they had a friendly phone conversation, recorded and circulated, in which Trump complimented Prabowo\u2019s command of English. As typically happens with Presidential visits, it fell to the US business community to show where the real center of gravity rests in the relationship. But, although the vibes in the meeting between US executives and Prabowo were strong and enthusiastic, the participants were a small group of \u201cusual suspects\u201d, companies already strongly committed to Indonesia. Serious planning for Prabowo\u2019s overseas trips may have only begun after the inauguration; the meeting with executives was arranged at the last minute. With more time and planning, a much larger array of companies could have been assembled.<\/p>\n

Prabowo\u2019s visit to the US underlined a major recommendation of the Asia Foundation\u2019s report \u201cCritical Issues Facing the US in SEA in 2025\u201d, discussed during our 12\/9 event: the US needs a stronger trade engagement agenda with the region, including Indonesia. The panel\u2019s consensus is that our military relationship is strongest.<\/p>\n

Prabowo\u2019s statements and remarks at all of his bilateral and multilateral events focused on key global issues: climate change, food security, Middle East, Ukraine, freedom of navigation. He continues to follow Indonesia\u2019s traditional non-aligned status but shares US views on a two-state solution to the Israel\/Palestine conflict, a commitment to uphold principles of sovereignty and border integrity (Ukraine), and freedom of navigation (South China Sea). One hiccup that arose during Prabowo\u2019s trip occurred in China, where the new President signed Indonesia on to a statement to jointly develop an oil\/gas deposit in border region claimed by China but within the Indonesia\u2019s exclusive economic zone. Reports indicate that the foreign ministry\u2019s advice to alter or abandon the statement was either ignored or overlooked. White House staffers were already prepared to question whether Indonesia had changed its views on China\u2019s 9 dash line when Prabowo\u2019s delegation arrived in the US. Perhaps it was inexperience or just a willingness to please a generous host. Since the trip Indonesia has reiterated its position of not recognizing China\u2019s claims.<\/p>\n

Prabowo clearly had success projecting Indonesia\u2019s intention to be a meaningful and responsible international player. Tamalia Alisjahbana, writing for The Independent Observer, an Indonesian publication, remarked: \u201cPrabowo is the first Indonesian president since Soekarno, so determined to have the nation use Indonesia\u2019s soft power, natural assets, and inclusive foreign policy to play a significant role in foreign affairs.\u201d The Economist strongly chastised Prabowo\u2019s \u201ckow tows\u201d to Chinese claims over South China Seas resources, seeing this as a weakness that belied the strongman image he projected during his 3 Presidential campaigns. The overall consensus is with Alisjahbana\u2019s position, although Tempo, criticized Prabowo for telling the Chinese, the plight of its Muslim population (Uighars) was a domestic issue.<\/p>\n

Back home Prabowo has focused on key elements of his domestic agenda, food and energy security and financing his free meal program for kids and young mothers. He has run into budget headwinds and a slowing economy. He\u2019s been forced to scale back the meal program by a third and back away from a scheduled VAT increase from 11 to 12%. Finance Minister Sri Mulyani Indrawati is considering leveraging unspent \u201cdevelopment finance\u201d obtained via various financing mechanisms for loans to increase spending without changing the debt to GDP ratio or adding to the budget. A new entity Danantara has been created as a basket of state-owned enterprises that could similarly attract funding. These would be creative, but untried techniques in development finance that are already raising questions. Indonesia\u2019s business community sees the VAT increase adding another burden on consumers whose spending is the major component of the country\u2019s economy. Others may wonder how the assets in Danantara\u2014which include many indebted SOE\u2019s with opaque balance sheets such as Pertamina and PLN\u2014will be accounted for. Can this organization actually borrow independently, since its constituent assets are owned by the Ministry of Finance. Would Parliament go along with schemes where it is not consulted. No firm answers yet but things may clarify in the months ahead. Prabowo has had some good days, mostly abroad, now he and his enlarged Cabinet, some who don\u2019t have offices yet, have to deliver on their promises.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

November 2024 Commentary by Wayne Forrest President Prabowo began his Presidency mostly traveling outside of Indonesia, signaling the importance of repositioning the world\u2019s fourth largest nation in front of its […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"elementor_theme","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-8219","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/aiccusa.org\/index.php?rest_route=\/wp\/v2\/posts\/8219","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/aiccusa.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/aiccusa.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/aiccusa.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/aiccusa.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8219"}],"version-history":[{"count":2,"href":"https:\/\/aiccusa.org\/index.php?rest_route=\/wp\/v2\/posts\/8219\/revisions"}],"predecessor-version":[{"id":9241,"href":"https:\/\/aiccusa.org\/index.php?rest_route=\/wp\/v2\/posts\/8219\/revisions\/9241"}],"wp:attachment":[{"href":"https:\/\/aiccusa.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8219"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/aiccusa.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8219"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/aiccusa.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8219"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}