Introduction
In the last decade, President Joko “Jokowi” Widodo has transformed the eastern Indonesia region from an economic backwater to a strategic area for economic development under his administration.
By emphasizing the urgent need of commodity downstreaming policy for nickel and copper, Jokowi has carried out his ambitious vision to expand investment from the private sector and strengthen the manufacturing sector in the eastern region.
For instance, in late 2023, Jokowi went to Fakfak Regency in West Papua for the ground-breaking ceremony of what will soon become the largest fertilizer production factory in the Asia-Pacific region.
Furthermore, Halmahera Island in North Maluku Province was christened as another nickel mining site in 2018, cementing Jokowi’s vision of commodity-driven strategy for economic development.
Moreover, in 2015, an area of more than 3,000 hectares in Morowali Regency in Central Sulawesi was allocated for nickel-manufacturing industry to produce essential components for electric vehicle battery.
Although Jokowi has encountered sharp criticisms from civil society and academia alike during his second term, particularly on his pro-investment policy, his approach to foster development in eastern Indonesia has resulted in several achievements.
For instances, North Maluku – a regency that was dependent only on agricultural and marine products – has now been painted as performing exceptionally well. Its growth rate reached 24.85% (YoY) in the third quarter of 2022 – the highest economic growth compared to other provinces in the same time period.
Besides, the province of Central Sulawesi also maintained a stable economic performance during the Covid-19 pandemic even as other provinces suffered from contraction. In 2020, the province’s economy’s growth almost reached 5%, owing to its nickel-manufacturing sector built under Jokowi’s administration.
However, evidence indicates that some challenges in Jokowi’s administration will persist into the next administration, which is projected to be led by Prabowo Subianto based on latest election result. Some of these challenges are elaborated below.
Land Possession Disparity: Story from East Nusa Tenggara (NTT)
Evidence shows that Jokowi’s developmentalism has brought new problems, such as disparity of land possession, to the fore. Severe disparity of land ownership was evident, for example, in NTT, where a number of Strategic National Projects (PSN) were established. NTT has also become the site for the National Strategic Tourism Area (KSPN), specifically in Labuan Bajo and Rinca Island.
However, instead of resolving poverty that is afflicting the communities in NTT, these government-led development projects have resulted in the disparity of land ownership between investors and the locals.
These projects often serve as a basis for land-grabbing practice by the government. For instance, it occurred in Komodo Island where local communities had to be relocated because their settlement was to be converted into a KSPN in 2020.
In 2022, the Agrarian Reform Consortium (KPA) reported that more than 700,000 hectare of land in NTT belonged to the government and investors. Meanwhile, each household of the 775,100 small farmers in NTT only possessed less than half a hectare. This severe land disparity occurred in the same year that NTT’s economy was reported to experience a 3.05% growth rate.
In addition, there are also number of agrarian conflicts which imply the locals’ reluctance to welcome national projects in the area. The KPA also reported that number of agrarian conflicts in the province increase quite drastically from 17 cases in 2020 to 38 cases in 2021. Last year, this number grew to 61.
High Growth Rate, Low Welfare
While Jokowi’s rigorous developmentalism looks dazzling from afar, welfare distribution remains an issue for local communities.
It is a major issue in Central Sulawesi and North Maluku, two provinces that have seen economic boon from the nickel-manufacturing industry.
Evidence indicates that this boon has not able to generate welfare equally for local communities. In fact, although North Maluku saw remarkable economy growth in 2022, ironically, the provincial Gini ratio also experienced a hike in the same year from 0.279 in March to 0.309 in September.
A similar phenomenon took place in Central Sulawesi. Regencies in the province saw a major gap among themselves in terms of per capita gross regional domestic product (GRDP) in 2020 despite the fact that provincial GRDP rate rose slightly from roughly 61 million rupiah to almost 64 million rupiah in the span of a year thanks to the manufacturing sector.
For example, the aforementioned Morowali gained more than 500 million rupiah of its GRDP per capita while neighbouring regencies such as Morowali Utara did not even acquire a quarter of this figure. On top of that, more remote regencies including Banggai Kepulauan and Banggai Laut had the lowest regional GRDP per capita rate in the same period.
These examples demonstrate that Jokowi’s industrialization thrusts do not confer trickle down benefit to the people. Lucrative activities of nickel-manufacturing has only contributed growth to industrial areas such as Morowali but are incapable to distribute welfare to local communities in surrounding areas.
The Threat of Undernourishment
Human resource takes a hit as well. Despite Jokowi’s pledge to focus on human resource development programs in his second term, nonetheless, this remains a problem in eastern Indonesia.
For example, the high Prevalence of Undernourishment (PoU) index is not comprehensively addressed. The PoU indicates the affordability of foods in each region. Increase in PoU rate mean a serious threat of undernourishment in the population.
In fact, the PoU indices in Sulawesi, Maluku and Papua are relatively high compared to Jawa from 2017 to 2023 as shown in figures below. For instances, in 2022, the PoU indices in Maluku and North Maluku region reached 30%, or triple the national average rate. Paradoxically, the high figures of undernourishment in these provinces still persisted even as the nationwide figure declined in 2023.
This chart implies Jokowi’s developmentalism in eastern Indonesia has yet to bring about socio-economic benefits, such as a reduction in undernourishment, to the region.
Prabowo-Gibran: Jokowi 2.0?
Though official counting is still ongoing, the recently held presidential elections almost decidedly determined that Prabowo Subianto will succeed Jokowi as president. Prabowo has many times pledged to continue Jokowi’s vision of the country and, with the latter’s son Gibran Rakabuming Raka in his ticket and Jokowi’s own tacit though overt support, this might seem to be the case in the future.
Prabowo-Gibran pair has repeatedly articulated continuity and economic advancement as key messages of their campaign. They have signalled their eagerness to continue the success of downstream industries under Jokowi’s administration and other pro-growth policies. They have also indicated that Jokowi’s development policies will be used as the foundation to continue development under the grand vision of Indonesia Maju (Developed Indonesia).
The retired general has even planned to expand Jokowi-era policies with his plan to carry on downstreaming projects on 21 potential natural commodities that are available in Indonesia, ranging from coal to fishery products.
From these potential commodities, several of them could be found in the eastern Indonesia region, such as nickel in Central Sulawesi and North Maluku, copper in Papua, asphalt in Southeast Sulawesi, and marine products in the Maluku archipelago. These ambitious projects are expected to generate welfare through economic growth and job creation for local communities.
Nevertheless, the experience from Jokowi’s developmentalism shows that while commodity downstreaming policy has indeed triggered economic growth, the locals have not necessarily benefitted from it.
Furthermore, Jokowi’s development programs have created serious problems in eastern Indonesia such as land dispossession, economic stagnation for the locals and high prevalence of undernourishment.
It is important for the upcoming administration to recognize the problems that it must address, not simply pledging to continue the policy that has been in place for almost a decade.
Conclusion
Jokowi’s administration has brought about a number of development projects in eastern Indonesia through massive investment in the manufacturing, mining and tourism sectors, among others. Jokowi has been successful in shifting national development projects which were previously concentrated in Jawa to the eastern part of Indonesia. However, Jokowi’s development approach in eastern Indonesia has not significantly increased the welfare of the local communities.
Left unaddressed, the ongoing disparity between those in the Jawa and eastern Indonesia would continue to hinder Indonesia’s overall development. It is therefore a serious problem to be tackled by the next administration. If Prabowo-Gibran regard themselves as the successor of Jokowi, then it is incumbent upon them to improve on Jokowi’s pro-growth policies.
These policies should be coupled with a commitment to ensure welfare redistribution for local communities in eastern Indonesia, considering that is where the gap lays today. By putting “redistribution” as a key focus in their policy plan, it is not impossible for Prabowo-Gibran to achieve the Indonesia Maju that Jokowi has dreamed of.
