Indonesia was a topic that we did not know much about. We mentioned the over 17,000 islands that the country claims which seems like a nightmare to govern although the vast majority of the population of over 279 million people live on the islands of Java and Sumatra. Java, where the capital Jakarta is located, is the home of more than 50% of the population. Noteworthy, Jakarta is sinking at the rate of 6.7 inches annually due to the depletion of underground sources caused by the number of needed water wells in the capital. As a result, President Widodo announced in 2019 the plan to relocate the capital to a planned city on the island of Borneo north of Java. The move is expected to be completed by 2045.

Being the 4th most populous country in the world after India, China, and the U.S., there is a race between population growth and wealth, an area of importance that determines the future well-being of a country. The goal is obviously to get wealthy before you get old. China is failing in this category, while the U.S. looks very good. The median age in Indonesia is 29 compared to 39 in the U.S. and China.

Politically, Indonesia maintained, at the beginning of the Cold War, that it was not aligned with either superpower, developing relations with both, but their political energy was internally-focused. The U.S. as a result made decisions throughout history to ensure that Indonesia does not turn into a communist country, even to the extent that they supported Indonesia’s invasion of East Timor, a strong Christian stronghold, where 300,000 people were killed representing 25% of the total population. However, after the economic crisis in Thailand 1998 which spread into Indonesia, the U.S. offered to bail out Indonesia with a bridge loan from the IMF on the condition to release the grip on East Timor. As a result, East Timor gained its independence in 2002.

Over the years, Indonesia was ruled by military members even though it is called a democratic country/government. Indonesia is the 77th ranked democracy in the world (data vary), as compared to a disappointing 36th for the U.S.. Norway is #1.

Economically, Indonesia is an emerging economy after the U.S. bailout. It has a huge control of the world’s nickel supply, which is critical to the manufacture of electric vehicle batteries. Indonesia is a member of the G20 and is projected to be a top 4 economy by the year 2045. Geostrategically, it is located in a vital shipping point with more than 1,000 vessels passing through its straits on a weekly basis.

The U.S. policy opportunities are to develop closer military ties, restore Indonesia’s regional security role, and develop a regional crisis reaction force to counter China’s influence and support an open, stable, and prosperous Indonesia and the other Indo-Pacific nations. The QUAD alliance of the U.S., Australia,  Japan, and India is a good example of this partnership.

The topic for next week is “The High Seas Treaty”