Newly elected President, Joko Widodo, of the Indonesia is expected to be sworn in on October 20, 2014. The former Governor of Jakarta and the country is at a crossroad. Diminishing growth, budget issues, and more importantly lack of power over the Parliament are key issues for the newly elected President.
Mr. Widodo won the Presidential Election defeating Prabowo Subianto, son-in-law of former Indonesian dictator Suharto and a General, controls the country’s Parliament with 52 percent contrary to 36 percent for the coalition led by President Elect, Widodo. Parliament is already flexing its muscle and recently abolished local elections for electing mayors and governors. Instead, the new law calls for those positions to be appointed by regional assemblies. Widodo’s power as President to do things will be very limited.
Indonesia spends more than $30 billion a year, 17 percent of the countries budget, on subsidies mostly for fuel. Compare this to $16 billion a year that the country spends for capital projects. Even though Widodo is respected for his good governance, reducing fuel subsidies may not go well with the masses and his ability to do anything may be limited due to lack of control over the country’s Parliament.