Smooth election boosts economic sentiment: Experts

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.