Smooth election boosts economic sentiment: Experts
Dadan Wijaksana, The Jakarta Post/Jakarta
Waves of optimisms greeted the trouble-free runoff vote on Monday, with experts hailing the smooth process as a powerful starting point towards the much-needed revival of investor confidence in the economy.
The greatest message that the vote can convey to the business community, domestic and international, is that democracy indeed suits Indonesia, and thus provides guarantees of greater political stability, according to businessmen, a top economist and a government official on Monday.
The team of Susilo Bambang Yudhoyono and his running mate Jusuf Kalla look to win in a huge landslide over incumbent president Megawati Soekarnoputri and her running mate Hasyim Muzadi for the leadership of the country over the next five years. The provisional tally, with some 10 percent counted as of Monday night had Susilo leading by a comfortable margin with 59 percent of the vote.
The official announcement, however will not be for another two more weeks, by the General Elections Commission (KPU).
"But regardless of who wins, I find the process itself -- which so far has been peaceful, as a strong capital for the business community in terms of confidence.
"Especially as what we're seeing is a huge leap in democracy, from the old regime to the direct presidential system," Djimanto, secretary-general of the Indonesian Employers' Association (APINDO) said.
Djimanto said the runoff election should put an end to the lingering uncertainty among the business community here and abroad.
Chatib Basri, deputy director at the Institute for Economics and Social Research at the University of Indonesia (LPEM-UI) agreed.
"This sends a strong signal to investors, especially international businesspeople, that Indonesia can, and is able to, cope with a crucial process of democracy without disrupting political stability," Chatib said, while emphasizing that foreign investment was an important element of higher economic growth.
Despite the optimism, Djimanto and Chatib warned of a herculean economic task awaiting the next government.
"There is no such thing as a quick fix, due to the complexity of the problems gripping the economy.
"This momentum will only be maintained if the next government introduces a string of policies within the first 100 days in power. That could show that they are serious about fixing the economy," Chatib said.
On investment, the government could start by instantly removing all the rulings that are detrimental to investment such as exorbitant severance pay for fired workers, the lengthy bureaucracy for obtaining business licenses, the taxation system, etc. "Those things can be implemented soon by the government, yet the message will be powerful to the investors."
Djimanto said in principle, what the business community needed was a leader who opted to provide a clear down-to-earth action plan, rather than lip-service approaches. "This is what's been lacking. In 2003 for instance, the government declared it 'Investment Year', and boasted of incentives to increase investment. But, still to this day, we have seen no results."
Subronto Laras, president of automaker Indomobil Suzuki International, said it did not matter who wins as long as the government listened and acted upon the needs of the business community.