The 100-day challenge for the Susilo administration<\/p>\n
David E. Sumual, Jakarta<\/p>\n
The election process that began in March culminated in a
\npeaceful presidential runoff election on Monday. In the short
\nterm, this peaceful political event could be seen as a good start
\nfor a more sustainable push toward an era of higher economic
\ngrowth.<\/p>\n
This expectation is reasonable since the next government will
\ninherit an economy that is already rolling, supported by 14
\nmonths of low inflation and interest rates as well as relative
\nstability in the exchange rate.<\/p>\n
Given the pervasive corruption and sluggish economic progress,
\nthe majority of Indonesians have actually been longing for the
\npowerful mantra of \"change\". This may partly explain why
\nincumbent President Megawati Soekarnoputri could not retain her
\nhold on power.<\/p>\n
However, as a watchword, change is risky if the public's high
\nexpectations of better times cannot be met. These high hopes in
\nthe new government could take a backward turn into another round
\nof political and economic instability if the new administration
\ncannot manage these expectations. As such, the first 100 days
\nwill not be a honeymoon period for Susilo Bambang Yudhoyono's
\npresidency.<\/p>\n
In contrast, people and markets will wait for further details
\nof his policies, especially economic policies that are still
\nlittle-known so far. As a clue, an articulate presentation of his
\nvision on underlying critical policy issues and possible
\nsolutions for strategic challenges would be the key to winning
\npublic and market confidence in the first 100 days.<\/p>\n
The drafting of his cabinet will be an early signpost of how
\nSusilo's administration will conduct his policies. Certainly,
\nSusilo should demonstrate a clear reliance on meritocracy in
\nselecting his cabinet rather than choosing a partisan one.<\/p>\n
By selecting cabinet members that have professionalism,
\ncapacity and good track records, Susilo will send a signal to the
\npublic of his commitment to change. As such, his choices for the
\nattorney general and economic ministers will be the litmus test
\nof how serious he is in enforcing the law, combating corruption
\nand reinvigorating the economy.<\/p>\n
An immediate challenge facing the new government is the risk
\nof political-economic instability due to upcoming day-to-day
\nmatters. This includes the government's readiness to address
\nproblems relating to the upcoming holiday seasons, budget issues
\nand the massive repatriation of illegal migrants from Malaysia.<\/p>\n
With crude oil prices hovering above US$40\/barrel for almost
\nfour months, Indonesia's economy and particularly the
\ngovernment's finances will surely face a significant risk.
\nSusilo's government may thus not have any alternative but to cut
\nthe fuel price subsidies that now reach costs of around $8
\nbillion annually.<\/p>\n
Another problem awaiting the new government is the delayed
\nmassive deportation of around 700,000 illegal migrant workers
\nfrom Malaysia by January 2005. It would of course be a time bomb
\nif Susilo's government did not have clear and elaborate plans to
\naddress this problem.<\/p>\n
The next major challenge is the possibility of political
\nturbulence, as Susilo may become a president without
\nparliamentary support due to his lack of a solid legislative base
\nin the House of Representatives.<\/p>\n
On several occasions, the nationhood coalition, led by Golkar
\nleader Akbar Tandjung has vowed to become a permanent opposition
\nforce in the parliament if Megawati loses in the election runoff.
\nHowever, there is also indeed a possibility that this coalition
\nwill break apart due to power struggles led by the pro-Susilo
\nlobby within Golkar. Given this situation, the next government
\nmay look at what Argentine President Nestor Kirchner and Mexico
\npresident Vicente Fox did when they took office with shaky
\nsupport from parliament.<\/p>\n
Both these presidents succeeded during their first 100 days by
\nundertaking bold and far-reaching strategic actions to fulfill
\ntheir campaign promises. Learning from both presidents, Susilo
\ncould use his strong charismatic leadership and communication
\nskills by using the media as a catalyst to present himself as a
\nman fighting against corruption and having the urgency to revive
\nthe national economy.<\/p>\n
Efforts to stamp out corruption, illegal logging and
\nsmuggling, for instance, by investigating a list of high-profile
\nsuspects would certainly have wider public support. With such a
\nmove, the positive endorsement of public opinion and even from
\npolitical members of the non-Susilo-camp could be expected.<\/p>\n
Although the Susilo administration may successfully navigate
\nthe course of domestic politics in the first 100 days, long-term
\ninvestors could still stay on the sidelines, waiting for
\ndevelopments in legal reforms and security. As such, it would be
\na big plus for Susilo if in the first 100 days, his
\nadministration could demonstrate strong commitment to legal
\ncertainty by abiding and enforcing contracts. It would also be a
\npositive move if his government could cut back the many
\nbureaucratic procedures relating to investment that weigh on the
\ncountry's competitiveness.<\/p>\n
Moreover, combating terrorism and dealing with separatist
\nmovements should also have a sharper focus in order to change the
\nsecurity risk perception among most foreign investors. After the
\nrecent terrorist bombing that targeted the Australian Embassy,
\nthe next government must intensify its efforts to do battle with
\nthe terrorists.<\/p>\n
Formally banning Jamaah Islamiyah and publicly declaring war
\non militants may restore domestic and international confidence
\nabout domestic security.<\/p>\n
By taking bold moves to destroy terrorism, the public and
\ninvestors will see the government is acting to protect their
\nsecurity and investments. Thus, the public relations skills to
\ndeal with perception and sentiment will be badly needed by the
\nincoming administration.<\/p>\n
By addressing these main challenges in the first 100 days of
\nits administration, Susilo's government can hopefully attract the
\nlong-awaited investment necessary to help around 40 million
\nIndonesians who are currently either unemployed or under-
\nemployed.<\/p>\n
People and particularly businessmen have high hopes that the
\nrules of the game will change as they await any signposts of
\naction programs in the first 100 days of the new administration.<\/p>\n
If the Susilo-Kalla pairing is incapable of strongly
\nasserting leadership and commitment to change in the first 100
\ndays, skepticism may start to grow again, which would not bode
\nwell for the country's outlook.<\/p>\n
The writer is an analyst at the Danareksa Research Institute.
\nThis article is his personal view.<\/p>",
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