2019: A Year of Challenges
Indonesian pencak silat athlete and Asian Games gold medalist Hanifan Yudani Kusumah celebrates his joy by embracing President Joko “Jokowi” Widodo and the general chairman of the Indonesian Pencak Silat Association (IPSI), Prabowo Subianto, at Taman Mini Indonesia Indah, Jakarta, on Aug. 29.
The year 2019 will not be easy in terms of the economy, and it will also be the first time the legislative and presidential elections will be held simultaneously. The people should have the maturity and social capability to overcome any conflicts that may occur.
The new year is coming soon. We have already passed through 2018, which has been full of dynamics, stemming from both within the country and the international world. To welcome the new year, Kompas will be presenting a series of articles on the opportunities and challenges awaiting Indonesia in 2019, published in the first 20 pages of the daily newspaper.
The global dynamics that affected Indonesia in 2018 are expected to continue in 2019, mainly global economic pressures and political dynamics in several regions.
The rupiah has been under considerable pressure this year. Its exchange rate has fallen to beyond Rp 15,000 per US dollar. The currency pressure is projected to continue in 2019, as the US central bank is expected to raise its benchmark interest rate at least twice more, to put a brake on the overheated domestic economy. The relatively high US treasury yields have prompted money market investors to move their investments to the US and depart the financial markets of many countries, including emerging economies like Indonesia.
The rupiah has weakened because the demand for foreign exchange is greater than the supply. Indonesia should therefore be able to increase its exports of goods and services to cover the current account deficit.
The role of Bank Indonesia (BI) in maintaining exchange rate and inflation stability is decisive. BI\'s aggressive move to raise its benchmark interest rates has helped reduce capital outflows from the money market. Inflation has also been kept low at around 3 percent, an important factor to maintain purchasing power.
The US-China trade war will continue. Tensions between the two countries could expand beyond the trade war following the US’ request for the Canadian government to extradite Meng Wanzhou, the CFO of Huawei Technologies Co. Ltd. The US is accusing Meng of misleading multinational banks about Huawei\'s control of a company that operated in Iran, in violation of US sanctions. China has responded to Canada\'s arrest of Meng by arresting former Canadian diplomats and businessmen visiting Beijing.
For Indonesia, the trade war between the two countries is both a challenge and an opportunity. Indonesia can fill the supply chain gap to both countries. A number of businesses plan to move their factories out of China and the US to avoid the tariff war that have made their products uncompetitive.
To take advantage of the situation, Indonesia must be able to provide incentives more attractive than other countries, especially fellow ASEAN states. The government has provided many incentives,
including tax holidays in several industry sectors. What must be addressed is the readiness of regional administrations to translate central government policies, because they are responsible for regional implementation of national policies.
More mature
On April 17, 2019, the presidential and general elections will be held simultaneously. After successfully holding the simultaneous regional elections on June 27, 2018 in a peaceful and orderly manner in 171 regions, we are confident that the 2019 election will also proceed peacefully.
The 2019 election will be a test on the quality of our democracy, as the people will be electing their President as well as their representatives in the House of Representatives (DPR), the Regional Representatives Council (DPD) and the Regional Legislative Councils (DPRDs).
Voter turnout in the 2019 election could increase to 75 percent as per the General Election Commission’s (KPU) targeted, but only if the public believes the election will run in an orderly, safe, honest and fair manner, and that the candidates have programs that meet their expectations.
In the midst of the tumultuous campaign period, concerns exist on the increase in hate speech, fake news and identity politics. Several studies, including those of the Religious Affairs Ministry’s research and development department, show that although public tolerance remains high, the last three years has seen a downward trend.
Social media is the primary vehicle for spreading hate speech and fake news. But social media is also a powerful tool for mobilizing voter support. In this context, social media can be viewed as a channel for spreading public dissatisfaction and that, despite the odd ripple, it does not cause many incidences of physical violence or social clashes. This was part of the excerpts from yesterday’s interview with Vice President Jusuf Kalla in Kompas (12/13/2018).
Indonesia remains a tolerant nation. Everything we have undergone shows that the public is more democratically mature. As a nation, we have strong resilience amid high diversity. These are important social, economic and political capital in entering 2019.
Heading towards voting day, the people expect the two presidential candidate pairs to campaigns on the work programs they would implement, if elected.
It is the two candidates’ responsibility to encourage the people to think critically to improve the quality of our democracy. Next year will also be a test for us as a nation and a state in holding clean, honest and fair elections.
Resurrection year
If the election is held in an orderly and peaceful manner, 2019 will be a year of revival in both the political and the economic spheres. As the coming year will not be easy in terms of the economy, with recession overshadowing the US economy towards the year’s end, we must improve conditions within the country.
Economic growth will be an important issue in 2019. The economy must be able to grow more than 5.2 percent to accommodate an expanded workforce and to benefit from the demographic bonus that is expected to peak in 2030.
Next year will be a year of economic revival if the problems we have identified are resolved. Aside from developing physical infrastructure, the victor of the 2019 presidential election must also develop the economic and social infrastructure, particularly in education and health.
Developing infrastructure to support the economy is necessary to ensure equal distribution of liquidity in rural areas. The inequality between cities and villages and between Java and regions outside Java exists because money is circulated primarily in cities on Java, especially Jakarta.
In terms of social infrastructure, education and health are two sides of a coin. In the midst of our aspirations to jump from a middle-income country to a high-income country, we are still faced with the fact that 30 percent of children under 5 are malnourished, which leads to stunting. Health is closely tied to not only income, but also to knowledge and food access.
While the government and some companies have begun to incorporate Industry 4.0 into their work programs, more than 50 percent of our workers are mere junior high school graduates.
Some workers remain under conditions of early industrialization, such as using weaving looms instead of weaving machines; others still rely on simple machines, while still others are using robots, as in the automotive industry, and a small number are utilizing the internet of things (IoT) in their business activities.
Mastering the use of science and technology and improving the quality of human resources cannot be accomplished in work program of only one to two years. This is the duty of the next President, who must have a clear direction in their policies and programs on the two issues.
Corruption eradication will also remain a challenge next year. Law enforcement must go hand in hand with prevention; prevention efforts must start early and run continuously through education.
Meeting the people’s basic needs like food, education and health is part of human rights, as is ensuring that the people are free of fear and discrimination.
In the end, whoever is elected as the President or as a representative of the people in the legislature, they should be able to set new commitments to progress Indonesia to a higher level.
The victor of the 2019 presidential election must embrace all parties, because we need national cohesion to face the challenges we face, both within and without. They should continue their predecessors’ good work so that they don\'t start from zero, which will only cause a slowdown in efforts to attain our goals towards a just and prosperous society.
