Asia Minute: Indonesia’s President Tries to Attract International Investment
This is a busy week for the international profile of Indonesia. The president has hosted the British Prime Minister and made his first state visit to Singapore. But the activity also underlines some of the challenges facing the biggest economy in Southeast Asia. HPR’s Bill Dorman has more in today’s Asia Minute.
Indonesian President Joko Widodo told an audience in Singapore this week that now is the time to invest in his country. That could be a tough sell. Singapore has been among the top investors in Indonesia for more than a decade, putting nearly six-billion dollars into the neighboring country last year alone.
But these are challenging times: Indonesia’s economy is growing at its most sluggish pace in six years. The rupiah is at a 17-year low against the dollar, and exports in the commodity heavy economy have plunged. China is Indonesia’s biggest market for exports, and Beijing’s slowing economy has hurt, cutting the value of those exports by more than a third in the first quarter of this year.
Earlier in the week, British Prime Minister David Cameron stopped by Jakarta, promising a loan of up to 1.6 billion U.S. dollars to build infrastructure projects around the country. Indonesia’s troubles are not just about economics, politics have slowed the stated ambitions of President Widodo. The former mayor of Jakarta swept to power last October with pledges of reform that have been slow to materialize. Critics and many supporters are calling for a cabinet reshuffle to put more of a focus on reviving economic growth.