Prabowo Subianto Becomes Indonesian President

On April 22, 2024, Indonesia’s General Election Commission officially declared Prabowo Subianto as the country’s next president, and Gibran Rakabuming Raka (the eldest son of President Joko Widodo) as the next vice president after appeals from two defeated presidential candidates over the presidential polls were rejected by the constitutional court.

The Prabowo-Gibran ticket received 96 million votes or roughly 59 percent of the total votes. Prabowo’s administration will inherit an economy that has seen improvements in sovereign ratings under the outgoing leadership.

Continuity is a key theme for the Prabowo-Gibran administration, promising to uphold many of Jokowi’s policies, including developing downstream commodities sectors, modernizing infrastructure, and maintaining a disciplined macroeconomic governing agenda. The government’s ban on unprocessed nickel and bauxite export, with plans to expand to other metals, has elevated Indonesia’s position in the global resource supply chain, particularly for electric vehicle batteries, leading to increased exports.  Additionally, Prabowo pledges to continue the ambitious US$35 billion project of relocating the capital to the island of Borneo, around 2,000km from Jakarta.

The Prabowo-Gibran administration aims for an ambitious economic growth target of eight percent and intends to enhance Indonesia’s energy self-sufficiency by promoting biodiesel derived from palm oil. Analysts predict a growth rate of 4.5-5 percent for Indonesia in 2024, attributed to lower commodity prices and subdued global demand.

Prabowo’s vision includes transforming Indonesia into an advanced and developed economy and integrating the Indonesian economy into global value chains. Such reforms entail regulatory changes to facilitate foreign investment, addressing a nascent tax base, and deepening capital markets. Therefore, foreign enterprises and investors eyeing Indonesia must adopt a long-term perspective, recognizing the nation’s sizable population of nearly 300 million, its competitive labor market growing incomes, and industrial opportunity.

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