The Indonesian elections and China

Maritime boundaries, electric vehicles and cats

Hola Global Jigsaw,

Indonesia has a new President elect, Prabowo Subianto, who is set to take over from two-term incumbent, Joko “Jokowi” Widodo in October 2024.  This is a year of big elections around the world, with behemoths like India and the United States going to the polls. As a result, Prabowo’s victory may not have received the international media attention that it deserves. But despite the Indonesian archipelago’s propensity to fly below the geopolitical radar, its future choice of actions under the new President, will have significant regional, and global, implications.

I lived in Jakarta for four years between 2012 and 2016, and still follow developments there with interest. Here’s an explainer about what we can expect from Prabowo Subianto, the nation’s new President elect.

Indonesia is not only the world’s fourth most populous country, but also its largest Muslim-majority democracy, which gives it both economic and geopolitical heft.  Its size makes it a natural leader amongst the 10 nations that comprise ASEAN (the Association of Southeast Asian Nations), a region that is roiled by ongoing border disputes with China.

Beijing has extensive territorial and maritime claims in the South China Sea that have led to conflicts, in particular, with Vietnam, the Philippines, Malaysia, and Brunei. Consequently, the area is volatile, with a history of dangerous escalation. In this charged atmosphere, the fact that Indonesia is not a direct claimant in the dispute – although its exclusive economic zone around the Natuna Islands do overlap with China’s claims - gives it a natural advantage as mediator.

Source: Wikipedia

This is a role that suits the archipelago’s traditional, non-aligned inclinations. Since the start of its democratic era in the late 1990s, Jakarta’s priority on the international stage has been to secure strategic autonomy in decision-making. Under President Jokowi’s decade-long stint at the helm, the nation exploited its unique position in the context of the ongoing China-US rivalry, by maintaining positive bilateral ties with both. However, on the economic front, the archipelago has tilted closer than ever before to China.

Jokowi, who went to China for his first visit after he was inaugurated as president in 2014, secured a USD 7.3 billion loan from Beijing for Indonesia’s first high-speed rail project from Jakarta to Bandung. He also made Chinese investment for Indonesia’s nascent electric vehicle industry, a priority. Indonesia has the world’s largest nickel reserves, which are an important component for EV batteries. Consequently, Chinese firms, including the world’s biggest EV battery maker Contemporary Amperex Technology as well as steel maker, Tsingshan Group, have built plants and smelters in the archipelago.

During the COVID pandemic, Jakarta was a major buyer of Chinese-made COVID-19 vaccines, administering hundreds of millions of doses produced by China's Sinovac Biotech. Vaccine diplomacy aside, China is currently Indonesia’s top trade partner, with bilateral trade worth over USD130 billion annually, nearly double the amount when Jokowi assumed office. Beijing was also Jakarta’s second-largest investor, after Singapore, in 2022. To put this in context, a decade ago, China was barely in Indonesia’s top 10 list.

From Beijing’s perspective, its relationship with Indonesia is pivotal, given the latter’s status as a major littoral player, at a key maritime choke point, in a region populated by allies of the United States. But these same reasons also make Jakarta a valuable partner for Washington DC.

Jokowi’s overtures to China were not exclusive. During his tenure, he also courted U.S. investment, successfully making a deal with Ford to invest in a nickel processing plant on the island of Sulawesi. Attempts to lure carmaker Tesla into opening production facilities are also ongoing.

But China’s investments in Indonesia, eclipse those of the US. According to Indonesian government data, China invested USD 7.4 billion in 2023, compared to only USD 3.3 billion from the United States.

The question now, is whether or not this trend will continue under incoming leader, Prabowo Subianto. Beijing was quick off the mark in courting the soon-to-be President, with cuddly gestures that provided for Instagram photo ops. Soon after Prabowo’s victory at the polls, the Chinese embassy in Jakarta sent him gifts for Bobby, his pet cat, including a stuffed toy. China’s ambassador to Indonesia also went to his home to congratulate him in person.

Prabowo Subianto (left) and Chinese Ambassador to Indonesia Lu Gang (right) take a picture with the former's pet, Bobby. (The Jakarta Post/Antara)

In early April, Prabowo traveled to Beijing to meet with President Xi Jinping. The visit was ostensibly made in his current capacity as Indonesia’s defense minister, rather than as President-elect. But the symbolism can hardly be ignored. Following their talks, Prabowo said that China was “one of the key partners in ensuring regional peace and stability,” adding that he will seek to boost defense cooperation with China. The latter could only have been music to Beijing’s ears.

In the run up to the elections, Prabowo - whose running mate was Jokowi’s eldest son, Gibran Rakabuming Raka - pledged to continue his predecessor’s economic and foreign policies. In fact, his victory – after two previous failed attempts - is largely seen as the result of the tacit endorsement of Jokowi.

But electoral pledges aside, Prabowo and Jokowi are very different in both their political backgrounds and temperament. Consequently, it is difficult to know whether the President elect might unexpectedly break from the current President’s cautious, balancing approach in international relations.

Unlike Jokowi, who came from a humble, middle-class background, Prabowo is from one of the country’s most prominent military families. Under the dictatorship of President Suharto, he rose to the commander of the Army Strategic Reserve Command and was involved in high-profile operations related to internal security and counterinsurgency efforts. Allegations of human rights abuses, such as the alleged kidnapping of pro-democracy activists in 1998, have dogged him.

He is known to have a mercurial temper and most analysts believe him to be more liable to explosive outbursts, than the mild-mannered and measured, Jokowi. Prabowo has always burnished his credentials as a nationalist, which could make him more likely to take an anti-China stance if Indonesia is dragged into the South China Sea conflict.

He has expressed his intent to begin the exploitation of gas reserves in the North Natuna Sea, which falls within China’s maritime claims in the region. He has also consistently argued for a strong defense force, the construction of platforms for maritime patrols and additional satellites. For Beijing, it is natural to interpret moves towards the beefing up of military and reconnaissance capabilities, such as those proposed by Prabowo, as implicitly aimed against China.

 Immediately after his meeting with the Chinese President on April 1, Prabowo headed to Tokyo, to meet with Japanese Prime Minister Fumio Kishida. By pairing visits to these two archrivals, Prabowo is exploiting his country’s enviable position of being courted by major powers on both sides of key geopolitical rivalries.

Indonesia punching below its weight in international affairs has almost become a meme of sorts in geostrategic circles. But with Prabowo Subianto in the driver’s seat, the archipelago will now be led by a fiery leader with a more international bent than his two-term predecessor.  The meme might well be in need of an update soon.

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That’s all for this week, folks. If you are voting any time soon, in any election, think deeply before making a choice. Behaving decently in what is rapidly becoming an indecent world is hard. Bon courage for fighting the good fight,

Until soon,

Pallavi