100 Days of Indonesia's Jokowi: Mixed Record

Indonesian President Joko Widodo, who came into office on Oct. 20, ends his first hundred days in office next week with a record more mixed than his most enthusiastic adherents had expected when he was elected.

Jokowi, as he prefers to be known, has earned domestic criticism through some suspect cabinet appointments, raising questions whether he is able to stand up to Megawati Sukarnoputri, the former president (2001-2004) and head of the Indonesian Democratic Party of Struggle, which sponsored his electoral campaign.

The nomination of Megawati’s former adjutant, Budi Gunawan, as head of the national police has turned into a major embarrassment, with the Corruption Eradication Commission (KPK) charging the official with bribery when he was head of the career development bureau at the National Police headquarters from 2003-2006.

But Jokowi has won praise from economists for doing away with fuel subsidies, which had the corollary effect of breaking the back of the country’s notorious Oil Mafia. He has served notice internationally with a new strong maritime policy that has resulted in the spectacular sinking of Vietnamese fishing boats that intruded into Indonesian waters. The policy was given prominence in his inaugural address and again in mid-November that he intends to make his nation into a regional maritime power. .

He maintained his common touch when confronted by the loss of AirAsia flight QZ8501, which was traveling from Surabaya to Singapore on Dec.28 with 155 passengers aboard. Jokowi met with the families and instructed all related institutions to speed up the search for victims.

As it was with the previous government, economic nationalism remains a theme and will continue to be although there may be more certainty about how things are going to be done than under former President Susilo Bambang Yudhoyono. The plan is for infrastructure improvements to make investment attractive even if the rules are skewed in a nationalist direction.

The administration is expected to continue to try to force localization of industry, for example, and probably will demand that multinationals take local partners. The bet is that the economy is big enough to still be attractive to investors as long as there is greater connectivity, better ports and clearer rules. Jokowi's team is also embarked on a plan for full national food security, which to some critics seems misguided.

Jokowi is Indonesia’s seventh president. He has been hailed as a major political phenomenon, having been catapulted in less than a decade from furniture businessman to mayor of Solo, a small city in East Java, to the presidency. Along the way, in 2012 he was elected to head what was previously regarded as an ungovernable city of Jakarta, and instituted a series of social and infrastructure reforms that won him widespread praise and a plurality of more than 53 percent of voters in the 2014 presidential election. In that race, he trounced the retired three-star General Prabowo Subianto, but never in Indonesian political history was the country as divided—a division that continues to be reflected today in the parliament as well as the public in general.

During his campaign, Jokowi repeatedly said he wanted to avoid business-as-usual politics by appointing ministers with professional backgrounds instead of those from political parties. That specific assurance won the hearts and minds of tens of millions of Indonesian voters mostly fed up with the notoriously corrupt and greedy politicians they have witnessed in decades.

But good things tend not to last forever. The disappointments started when Jokowi announced his cabinet lineup on Sept. 15. Despite repeated promises that he would start with a clean slate, 14 of his 34 ministers were chosen from political parties who backed him during the presidential race, while the rest are from professional ranks.

This is a clear example that even Jokowi, who was expected to transform Indonesia’s frail political infrastructure — with his “mental revolution” jargon — was unable to avoid the long tradition of horse-trading. The cabinet was sworn in at the state palace on Oct. 27 with Megawati in attendance. The skeptics believe she has a strong influence on Jokowi’s policies. Although there are 20 figures with professional backgrounds, a closer look reveals that some have close relationships with Megawati, earning a downbeat response from the markets, with the Jakarta composite index (JCI) and rupiah falling slightly after a rapid rise prior to his election.

The problem of nepotism didn’t stop there. In November 2014, Jokowi bore the brunt of heavy criticism and public disappointment after deciding to appoint HM Prasetyo as the country’s attorney general. Prasetyo is a member of the National Democrat Party which supported Jokowi during his presidential race. Many critics said Prasetyo's appointment will only serve to protect the interests of Jokowi’s circle in the next five years.

At the beginning of January, Jokowi also appointed Luhut Panjaitan, a retired army general who was his advisor during the election campaign, to lead a newly established agency called the “presidential working unit,” a position which many equate with the presidential chief of staff.

But it was his decision to appoint Commissioner General Budi Gunawan — Megawati’s adjutant when she was president between 2001 and 2004 – to lead the National Police that has drawn significant fire. In addition to the bribery charge by the KPK, Budi is widely considered to be a corrupt figure put in charge of one of Indonesia’s most corrupt public institutions.

Budi is one of several police generals whose bank accounts the country’s Financial Transaction Reports and Analysis Center (PPATK) linked to dubious sources in 2009. His wealth disclosure document in 2013 revealed assets of Rp22.6 billion (US$1.8 million) despite a monthly take-home pay of less than Rp18 million as a police general.

In nominating Budi, Jokowi did not consult with the KPK or the PPATK, as he did when nominating his cabinet ministers, and he is paying for it. Former PPATK chief Yunus Husein, in response to Budi’s appointment, tweeted that “Current police chief nominee was once nominated as a minister, but during background information investigation by the PPATK and KPK, he got a red card [did not pass].”

Aside from staunch critics on his presidential appointments, Jokowi made a courageous decision to do away with fuel subsidies, resulting in a fuel price hike and a degree of public irritation. The fuel subsidy was a longstanding drag on the country’s economy that Yudhoyono was unwilling to solve on his way out of office.

The fuel price hike, finally announced in November, saw the price of gasoline and diesel fuel bounce upwards by an average of 30 percent. Subsidized gasoline went from Rp6,500 to Rp8,500 per liter and subsidized diesel from Rp5,500 to Rp7,500. The incoming Finance Minister Bambang Brodjonegoro said that cutting subsidy spending would give the government up to Rp120 trillion of additional budget funds, which should be spent on more productive sectors, such as boosting the country’s poor infrastructure condition.

In an effort to ameliorate the burden on consumers, Jokowi launched a “magic cards” program consisting of social welfare programs entitling the poor to various forms of government assistance, which critics dismissed as no different from those initiated by Yudhoyono. It was a program he instituted as Jakarta governor and was extremely popular, however.

The move to eliminate the subsidy is said to have surprised the oil mafia, a shadowy cabal that profited from importing 500,000 barrels of oil per day from offshore sources, reportedly costing the government as much as US$5 billion annually. The oil mafia is said to include even members of Jokowi's PDI-P, as well as officials of Golkar and Yudhoyono’s Democratic Party. Political sources describe the system as a funding mechanism for powerful political parties and a route to vast wealth.

Reportedly the top figures in the oil trading business have been told that the party is over and there will be no more skimming from imports. Officials close to Jokowi say they have warned top figures of the oil business it is time to quit. Getting them out is regarded as the key to breaking the stranglehold on imports.

It is also worth highlighting that the Indonesian government under Jokowi has decided to flex its muscles and sink foreign vessels found to be illegally poaching in the country’s waters. To show the seriousness of this policy, in December the Indonesian Navy blew up three Vietnamese boats for illegally fishing in Indonesian waters. The administration seems convinced that such drastic measures—compared to the “thousand friends and zero enemies” foreign policy under Yudhoyono — would not lead to conflict with other countries in the region ahead of the implementation of the Asean Economic Community (AEC) scheduled to take place at the of 2015.