President Widodo’s 3rd Year: Many Targets Met, Others Need to Improve 

Photo by President Office

JAKARTA (TheInsiderStories) – Joko Widodo has marked his performance as President of Indonesia for the past three years. Many of strategic initiative objectives have been met while others are yet to improve.

On the economic side, during the presidential campaign, Widodo promised the country would be growing at 7 per cent rate by the end of 2019. However, in the first quarter (1Q) of 2017, the economy only reached 5.01 per cent.

The progress that Widodo has made is demonstrated by macro indicators like the poverty rate, which has declined from 11.22 per cent in 2015 to 10.64 per cent in March 2017. The Inequality Index, calculated by the ‘Gini ratio’, also declined, from 0.408 in March 2015 to 0.393 as of March 2017.

In addition to all the material progress, Widodo’s administration still needs to pursue quality in economic growth; moreover, Indonesian consumers are recently hampered by weakened purchasing power.

Social and Poverty

During his first year in office, President Widodo set an ambitious target to reduce poverty to below 10 per cent by the end of 2019. Thus, the government launched a conditional cash transfer scheme, organized under the Ministry of Social Affairs, that currently assists more than 6 million families.

Under the program, the government will scale up its coverage, from 3.5 million families in 2015 to 10 million, or 15 per cent of the population, by the end of 2019. The Government has already allocated multiyear state budget funds amounting to $5.5 billion, to support the program over the period.

In addition, the government has issued other cash transfer programs, including the Program Indonesia Pintar (PIP) that has enrolled more than 8 million poverty-stricken students or school-age children, and the Healthy Indonesia Program, that has enrolled more than 92 million for promulgation of ideal nutrition.

During Widodo’s term, the poverty headcount fell from 28.28 million citizens to 27.8 million. These developments indicate a continued decline in the pace of poverty reduction, which averaged 1.1 per centage points annually in the last decade.

Meanwhile, inequality, as measured by the Gini coefficient for consumption, continued to decline. The Gini coefficient for March 2017 was 0.393, falling by 21 points from 0.414 in March 2014.

Politics and Corruption

On the political side, during his five-year term, he has seen three opposition parties, Golkar, the National Mandate Party (PAN) and the United Development Party (PPP), all switch to his side. Now, only two parties, Gerindra and the Justice Prosperous Party, remain in the opposition, which effectively means Widodo can expect strong parliamentary support to execute his so-called ‘Nawacita’ programs.

But, as is typical in political horse-trading here, such alliances come with a major price: to amass such a big coalition force, Widodo has been forced to make compromises on other issues, i.e. corruption eradication.

According to International Transparency data, in the past 15 years Indonesia has incrementally improved its ‘corruption score’, moving from 36 to 37 (higher means ‘cleaner’), now slightly above peer countries such as Thailand (35), the Philippines (35) and Vietnam (33) but still far below Malaysia (49) and Singapore (89). The ostensibly objective corruption score has Indonesia ranked 90th out of 176 countries surveyed.

The ever-popular ‘Corruption Eradication Commission’ (KPK) has made a meaningful contribution to this improvement, with high-profile arrests of influential politicians, local leaders and even Ministers on corruption grounds; by the same token the KPK has become hugely unpopular in the eyes of lawmakers.

And this is not for any lack of ability to act firmly, as in the case of highly-publicized ‘anti-drug’ efforts. Widodo reinstated capital punishment for drug offenders, with 18 convicted drug criminals executed thus far. Meanwhile all sorts of narcotics, ranging from brown heroin to highly-dangerous amphetamine pills, are freely available – and not just in the big cities.

The drug problem is quickly assuming the scope of a threat such as seen in Europe and the Americas, and religious leaders have been helpless to deal with it as well as politicians or police. Observers are openly asking how drugs manage to be cultivated (marijuana in Aceh), processed, packed, transported, distributed and sold on the street – something which never happened during the 32-year-long reign of President Soeharto.

However, rising intolerance and fundamentalist voices, as demonstrated by the large-scale protests against former Jakarta Governor Basuki Tjahaja Purnama last November and December, somehow affected business people’s perception and thwarted their willingness to repatriate their assets.

Mental Revolution Needed

President Widodo has projected a ‘mental revolutionary campaign’ for the first time in the last three years. It is actually an extension of previous government efforts to tackle corruption and bureaucracy than has stalled and resisted change in the post-President Soeharto era.

During his first year in office, instances of Islamist extremism and intolerant events rose 30 per cent. To tackle such hard-line extremist groups, the President decided to pass new government regulations on mass organizations.

Despite a mixed record of ups and downs in non-economic aspects, the government seems to have moved in a correct direction, as demonstrated in his medium term development plan (2015-2019) – even if macro results do not reflect satisfactory government performance.

Looking forward, the government should maintain consistency in structural reforms and the mental revolution if it sincerely wants to achieve the so-called ‘nawacita agenda’ during Widodo’s tenure. We do however think the government should adjust its target for more realistic growth considering what they have been able to achieve so far, over the last three years.

Writing by Linda Silaen, Email: