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Why Indonesia Will Overtake Malaysia : Economists Are Warning That Malaysia Is Heading For Dire Straits & Foreign Investors Were Fleeing

The presidential palace in Indonesia’s proposed new capital Nusantara is hugely impressive, if images of the model are anything to go by.

The first thing that strikes you is the garuda-shaped structure at the back of the state palace complex. With its wings spread wide, garuda appears to be symbolically protecting the palace and its residents.

Designed by sculptor Nyoman Nuarta, the garuda structure is expected to be 170 metres high. The Indonesian government hopes to celebrate its Aug 17 independence day in 2024 at the majestic complex which will sit on 100 hectares of land in East Kalimantan.

I am not surprised that Indonesian designers included the garuda or that President Joko Widodo (Jokowi) selected this particular initial design for the presidential palace. After all the mythical bird is Indonesia’s national emblem.

More than that, however, it tells the world how comfortable Indonesia is with its past, especially its Hindu past. And that is one of the biggest secrets of Indonesia’s success.

I have visited Indonesia a few times and I find that the locals have no hang-ups about their past. Muslim Indonesian’s are not ashamed or shy to admit that their ancestors were once Hindus or Buddhists or animists.

In fact, in my bits of conversations, I found that they were proud of their past.

That is why, I suppose, they chose the garuda – the vehicle of Vishnu who is one of the forms in which Hindus worship God – for their national emblem. That is why, I suppose, you can find so many reminders of their Hindu past remaining intact all over the nation.

For instance, they proudly welcome the world to view ancient marvels such as the 7th century Borobodur Buddhist temple in Central Java and the 8th century Prambanan Hindu temple in Yogyakarta.

One of their currency notes has the image of Ganesha – yet another form in which Hindus worship God – on it. Several educational institutions also carry images of Ganesha.

On my first visit to Jakarta, I was surprised to see a statue depicting a scene from the Mahabharata – a chariot with Krishna and Arjuna on it – in the centre of busy Jakarta. There are many more such statues all over Indonesia.

And when I visited Hard Rock Café, I found a large image of Ganesha sharing space with images of musicians, guitars and motorcycles.

Not long ago, I saw a video clip of an interview with Jokowi where he was asked to name the person he most admired or whose power he would like to have. The reply of the president of Muslim Indonesia surprised me. He said it was Krishna – another name for God in Hinduism, and the charioteer of Arjuna in the Mahabharata epic. Jokowi went on to give his reasons for selecting Krishna.

As far as I know, no one lodged police reports against him for saying that; or demanded that he be investigated or that he should resign. Many in post-Hussein Onn Malaysia may find this difficult to understand as Indonesia has the world’s largest Muslim population. But that is the Indonesian character – they are not only comfortable with their past, they embrace it.

The word Nusantara itself, like the name of Malaysia’s capital Putrajaya, has its source in Sanskrit, and it has an interesting story which harks back to an oath taken by Indonesia’s revered hero Gajah Mada in 1336.

Gajah Mada, the prime minister and military leader of Majapahit, a Javanese Hindu empire, unified the entire archipelago and took the empire to its peak of glory.

From what I’ve read, the word “Nusantara” first appears in the Pararaton, also known as the Katuturanira Ken Angrok, or Book of Kings, chronicling the history of the kings of Majapahit and Singhasari between 1481 and 1600 CE.

The story goes that Gajah Mada took an oath, called Sumpah Palapa, that he would not eat any spice – interpreted as not indulging in pleasures – until he had conquered the whole of Nusantara.

Nusantara, in those days, included today’s Indonesia, Malaysia, Singapore, Southern Thailand, the Philippines, Brunei, East Timor, Maluku, and the Sulu archipelago. And Gajah Mada did bring these areas, or most parts of these areas, under Majapahit rule.

Today, when Indonesians say “Nusantara”, they usually mean the islands comprising Indonesia.

But for Malaysians, the term “Nusantara” means the Malay archipelago.

Indonesia’s national development planning minister Suharso Monoarfa was reported as saying: “Nusantara is a geographic concept of the country that is made of islands and united by seas.” It was also a concept of unity that embraced diversity, he added.

The establishment of Nusantara gels with Indonesia’s Vision 2045, or Wawasan Indonesia 2045, which envisages a sovereign, prosperous and just nation which will take its place among the world’s economic giants when it celebrates its centennial.

And Jokowi, seen as a visionary and capable leader, is driving this vision forward. That is another secret of Indonesia’s success: a leader with ideas, intelligence, ability, energy and loads of humility.

Managing a nation that stretches 5,125 kilometres from east to west and consisting of 17,508 islands inhabited by various ethnicities is no joke. And Jokowi seems to be doing it pretty well, having brought about political stability and economic growth.

One major reason for this is his inclusive attitude. Remember, Jokowi made Prabowo Subianto, who ran in the past two presidential elections against him, his defence minister.

He wants everyone on board for Vision 2045 and engages fairly with all ethnic and religious groups. He works to tap the talents of all Indonesians so that no one feels left behind.

As a result, he has become a hero to many Indonesians, the darling of many analysts of geopolitics and the envy of leaders of various nations riddled with instability.

One of the hottest topics discussed in social media in Malaysia is about Indonesia’s ability to attract major investments while Malaysia is lagging behind. Reports say tech giants such as Google, Microsoft, Facebook and PayPal have invested heavily in Indonesia.

In February last year, it was reported that foreign investors were fleeing Malaysia due to its increasingly unstable politics. Today, economists and businessmen are warning that Malaysia is heading for dire straits if the political instability continues.

Veteran politician Tengku Razaleigh Hamzah is the latest to warn that the country is facing “dangerous political and economic failure”. On Feb 7, Razaleigh spoke of the need for “an extraordinary leadership” to check the slide.

On Feb 4, the Malaysian International Chamber of Commerce and Industry and the SME Association of Malaysia warned that perceived political instability was dampening investor confidence in the country.

So why does Indonesia seem to be forging ahead? Jokowi’s leadership and reforms are among the major reasons for this. In 2014, Indonesia ranked 120th on the World Bank’s Doing Business Index but by 2020 it had risen to 73 out of 190 nations.

Another secret to its emerging success is that people still trust their institutions, including its corruption eradication commission. Corruption is still a major problem, but measures taken are instilling confidence in Indonesians. Although Malaysia ranks better than Indonesia in the latest Transparency International Corruption Perception Index, Indonesia improved from 102 to 96 out of 180 countries while Malaysia dropped five spots to 62nd position.

Indonesia, already Southeast Asia’s largest economy, is becoming the darling of investors because of its business-friendly policies.

Last year, it managed to secure US$62.71 billion, (901.02 trillion rupiah), 50.4% of which was foreign direct investment (FDI). This, however, excludes investment in banking and the oil and gas sectors.

Singapore was the biggest source of FDI, followed by Hong Kong, China, the United States and Japan, according to a Reuters report.

The latest ground-breaking ceremony – a US$15 billion coal-to-dimethyl ether collaborative project between Air Products and Chemicals Inc of the US and Indonesian companies – took place in South Sumatra Province on Jan 24.

On Jan 21, Taiwan’s Foxconn Technology Group, the world’s largest electronic components maker, committed to building electric car components, electric batteries and electric motors, apart from relocating its telecommunication spare part manufacturing facility from China to Batang in Central Java.

Indonesian, Chinese and United Arab Emirates investors plan to build the world’s largest green industrial park in North Kalimantan. Also, Indonesia plans to build a container port in the Batam Free Trade Zone and a Free Port in Tanjungpinggir, Riau Islands – directly facing Singapore.

And Indonesia has just given notice that it wants to attract 1,200 trillion rupiah (RM350 billion) in investments from both domestic and foreign sources this year.

On Jan 17, at a function to celebrate the 67th founding anniversary of Parahyangan Catholic University in Bandung, West Java, Jokowi pushed Indonesians to embrace value-added economic activities, green energy development and a digital economy.

In talking about the proposed new capital in 2019, Jokowi said: “It will be similar to Silicon Valley (in the US), where creative industries are born and establish their headquarters.”

He added: “We are not only developing the centre of government but the capital city for the future, in which the systems are projected for the next 100 to 150 years.”

Will Nusantara be a success? Perhaps it will, given Indonesia’s current trajectory. But I don’t wish to make any prediction.

Right now though, Indonesia is on the move because it has a visionary leader and a capable administration that clamps down on graft, doesn’t give face to extremists, is inclusive, and has instituted business friendly policies.

Above all, it has learnt to not only blend its past with its present but also with its vision of the future. Indonesia shows that it is both comfortable with its past and confident of its future – as exemplified by the huge garuda watching over the majestic presidential complex with state-of-the art interiors in the upcoming green Nusantara in East Kalimantan.

Source : FMT

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