Mario Draghi, Prime Minister of Italy, passed the G20 Presidency\u2019s honorary gavel to Indonesia\u2019s president Joko Widodo, it marked the start of two crucial years of international influence for South East Asia\u2019s largest country, during which time it will chair firstly the G20 (culminating in a summit in Bali on 15-16 November this year) and then, for the following year, the ASEAN group of nations.<\/p>\n\n\n\n
The G20 leadership is a rotating \u201ctroika\u201d of countries, comprising the preceding, current and following chairs, such that Indonesia is joined by Italy and, more importantly for ASEAN, next year\u2019s president, India.\u00a0<\/p>\n\n\n\n
As the nations of South East Asia strive to rebuild, following the economic and social shock of the Covid-19 pandemic, and deal with the impact of other crises such as the war in Ukraine and unrest in Sri Lanka, it seems that Indonesia\u2019s turn to preside over the G20 may have come at just the right time to promote the needs and agendas of lower-middle income economies like itself and India, as well as Cambodia, Myanmar, Vietnam and the Philippines, according to World Bank classification.\u00a0 Lower-middle income economies are the true face of ASEAN, accounting for 82% of its combined population of nearly 680 million.\u00a0 \u00a0<\/p>\n\n\n\n
Put it this way - in Indonesia, ASEAN has a suitable champion, and in this year\u2019s G20 theme (\u201cRecover Together, Recover Stronger\u201d) an authentic rallying-cry.<\/p>\n\n\n\n
Last October, the G20 finance ministers\u2019 and central bank governors\u2019 meeting reflected that \u201cmost emerging and developing countries will take many more years to recover\u201d from the effects of the pandemic and have already suffered greater losses and economic scarring than advanced economies.\u00a0 Indonesia is particularly committed to strengthening diplomacy in the health sector, and is highlighting the wide gap between developed and developing countries in terms of Covid-19 vaccine access \u2013 a key issue for economic recovery and development.<\/p>\n\n\n\n
Indonesia\u2019s three priority issues during its G20 presidency are: the need for greater resilience and fairness in global health systems, digital transformation, and fair, affordable sustainable transitioning to clean energy.\u00a0 Indonesia is also keen to pursue structural and financial reforms, similar to those being promoted by Cambodia as chair of ASEAN this year - again, common ASEAN interests are coming to the fore.<\/p>\n\n\n\n
Speaking in Davos address last year, President Jokowi welcomed foreign investments in six of Indonesia\u2019s core sectors \u2013 including automotive (especially electric vehicles); export-oriented manufacturing, including healthcare; infrastructure; and renewable energy.\u00a0 Foreign direct investment, and the upgrading of production lines with leading-edge equipment and technologies, will be essential to Indonesia, as it strives towards greater prosperity, and entry into the World Bank\u2019s \u201cmiddle income\u201d bracket - something that Jakarta hopes to achieve very soon.<\/p>\n\n\n\n
Companies seeking to expand their business into Indonesia and the region can expect a growing domestic market, an improving investment climate, and a young, technically trained workforce. Growth figures from this year suggest that Indonesia is bouncing back from the shock of the pandemic.<\/p>\n\n\n\n
These could well prove to be defining years for Indonesia, and for its ASEAN neighbours.<\/p>\n\n\n\n