Updated June 6, 2019
Indonesia
Overview
side throughout his presidency, particularly in 2016-2017,
With 263 million citizens, Indonesia is the most populous
when Basuki Tjahaja Purmama, a political ally who is an
country in Southeast Asia, the world’s most populous
ethnically Chinese Christian, was charged and convicted of
Muslim-majority nation, and the world’s third-largest
blasphemy for a comment he allegedly made about the
democracy (after India and the United States). It has the
Koran at a campaign rally.
world’s 16th-largest economy and the 8th-largest when
ranked by purchasing power parity. It straddles important
Widodo has struggled with a shifting political coalition, as
sea lanes and borders the Strait of Malacca, one of the
rivalries between parties, and even within Widodo’s PDI-P
world’s busiest trade routes, as well as the Indian Ocean
party, have complicated governance. The 2019
and the South China Sea.
parliamentary elections made it likely that he can hold
together his legislative coalition, although Prabowo’s
Over the past two decades, Indonesia has become a robust
Gerindra party emerged as a stronger force in the political
democracy, holding four direct presidential elections, each
opposition. Widodo’s government has enacted several
considered by international observers to have been largely
economic reform packages aimed at streamlining
free and fair. In the most recent, held in April 2019,
bureaucratic processes to boost foreign and domestic
President Joko Widodo was reelected to a second five-year
investment.
term. Indonesia is an active member in regional diplomatic
institutions and a leader of the Association of Southeast
Asian Nations (ASEAN). The U.S.-Indonesia relationship
has broadened in recent years, with closer military and
counterterrorism cooperation and a range of new
educational, environmental, and energy initiatives. Some
Indonesian trade and economic regulations are of concern
to the United States. Indonesian leaders speak about the
nation’s central place in the “Indo-Pacific” region—an
important strategic concept for the Trump Administration.
Some 87% of Indonesians are Muslim, with the vast
majority subscribing to moderate, syncretic forms of the
religion. Religious diversity is enshrined in the constitution.
Some observers, however, express concern about growing
political influence of conservative religious groups who
have organized mass demonstrations against non-Muslim
politicians. Indonesia also has a recent history of violent
extremism: several bombings in Jakarta and tourist center
Bali targeted Westerners in the 2000s, and the persistence
of smaller-scale attacks raises concerns about the dangers
posed by Indonesians returning from the Middle East.
Political Background
President Widodo, universally known by his nickname
“Jokowi,” was reelected in April 2019 elections, winning
U.S. Engagement with Indonesia
55% of the popular vote. He campaigned on promises to
improve Indonesia’s
The United States engages Indonesia across a wide range of
infrastructure and raise living
issues, encouraging Indonesians to deepen their democratic
standards, particularly in underdeveloped areas. As of early
June, Widodo’s opponent Prabowo Subianto had yet to
institutions, promote religious tolerance and the rule of law,
develop a more liberal trade and investment climate,
concede the elections, and demonstrations that followed the
combat terrorism and engage on international issues such as
May 21 results announcement—spurred by Prabowo’s
maritime security and climate change. In October 2015, the
largely unsubstantiated allegations of electoral fraud—led
United States and Indonesia upgraded their bilateral
to six deaths in Jakarta.
“Comprehensive Partnership” to a “Strategic Partnership,”
Widodo chose Ma’ruf Amin, a conservative Islamic leader,
with a minister-level dialogue intended to address maritime
cooperation, defense cooperation, economic growth and
as his Vice President, at least in part to quell criticism from
development, energy cooperation, cooperation on global
some Islamic groups that his government is not sufficiently
and regional issues, and people-to-people ties. In January
conservative. Such criticism has been a thorn in Widodo’s
2018, on a visit to Jakarta, then-Defense Secretary James
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Indonesia
Mattis said: “We probably engage with the Indonesian
Economic Issues
military more than any other nation anywhere in terms of
In recent years, Indonesia’s economy has frequently posted
mil-to-mil engagements.” U.S. assistance to Indonesia
growth of more than 5%-6% annually, buoyed in part by its
totaled an estimated $132 million in FY2019. Most U.S.
favorable demographics (66% of its population is of
assistance supports health, environmental, and educational
working age). It is a large producer of natural gas and oil,
initiatives. Indonesia is part of the Indo-Pacific Maritime
and is a member of the Organization of the Petroleum
Security Initiative, which aims to strengthen Naval and
Exporting Countries. It is also the world’s leading exporter
Coast Guard capabilities in the region.
of palm oil. Still, about half of Indonesian households are
near the national poverty line of $24.40 per month. Despite
Security Cooperation
its large population, Indonesia is the 26th largest U.S.
U.S.-Indonesia security cooperation has deepened over the
trading partner, ranking below neighbors such as Singapore,
past decade, with the two militaries conducting dozens of
Malaysia, and Thailand. Over recent years, Indonesia has
regular annual engagements, including efforts to deepen
imposed some policies criticized by foreign investors,
maritime security cooperation and to combat terrorism. This
including foreign ownership restrictions and local content
represents a sharp change from the early 2000s, when U.S.
requirements in some industries, as well as renegotiation of
policies enacted in response to earlier human rights abuses
contracts for some energy and mining projects. President
by Indonesian forces severely limited bilateral
Widodo has sought to lift bureaucratic obstacles facing
engagements. In 1999, Congress suspended all International
foreign direct investment (FDI), and has actively courted
Military Education and Training (IMET) programs with
more FDI, particularly in the infrastructure sector.
Indonesia after Indonesia’s military and its militia proxies
killed over 1,000 in Timor-Leste following Timor’s vote to
Human Rights Issues
pursue independence from Indonesia. Programs were
Most observers believe Indonesian human rights protections
restarted on a limited basis in 2002 and, from 2005 to 2010,
have improved over the past 15 years. However, abuses still
the United States largely normalized military relations. In
occur, including some by members of the military. Alleged
2010, the U.S. resumed limited IMET programs with the
abuses are particularly frequent in areas with simmering
Kopassus special forces.
secessionist movements such as Papua. Some argue that
religious intolerance is rising. Islamist organizations have
Widodo’s government has announced plans to increase
harassed and attacked minority religious groups, including
military spending to 1.5% of GDP from levels below 1%,
Christians and other Islamic sects, such as the Shia and
focusing particularly on maritime capabilities. Indonesia is
Ahmadiyya, and, in 2016, large demonstrations by Islamist
increasingly involved in rising South China Sea tensions.
groups opposed to Jakarta’s Christian governor raised
Jakarta does not consider itself to have a formal territorial
concerns about creeping intolerance.
dispute with Beijing, but China’s extensive nine-dash line
claims overlap with Indonesia’s Exclusive Economic Zone
Indonesia is labeled a Tier 2 nation in the State
(EEZ), the coastal area over which a state has the right to
Department’s 2018 Trafficking in Persons report, which
regulate economic activity. Indonesian officials regularly
calls it a “major source country and, to a much lesser
voice concern about maritime behavior they see as overly
extent, destination country for women, children and men
aggressive, and have periodically confronted or warned off
subjected to sex trafficking and forced labor.” Corruption is
Chinese fishing and law-enforcement vessels seen as
widespread: Transparency International ranked Indonesia
encroaching on Indonesian waters. In 2017, Indonesia
89th out of 180 nations in its 2018 Corruption Perceptions
elicited a formal diplomatic protest from Beijing by
Index, below other Asian nations such as China and India.
renaming waters off the Natuna Islands, north of Borneo,
However, many observers believe that Indonesia’s
the North Natuna Sea.
democratic development and the growth of its independent
press and civil society have created a more accountable
Militancy and Terrorism
system in which people can choose their leaders and
Indonesia has had a long-running issue of domestic
participate in policymaking through community or
militancy, and the Islamic State (IS) has raised concerns
nongovernmental organizations.
among many in Indonesia by conducting recruiting in
Bahasa Indonesia, Indonesia’s national language. In May
Environmental Issues
2018, a set of suicide attacks in Surabaya killed 12
Indonesia is among the world’s most bio-diverse regions,
civilians, with at least one attack conducted by a family that
but its record of environmental protection is constrained by
had recently been deported from Syria. Indonesia amended
weak rule of law and poor land management. Because of
its 2003 Anti-Terrorism Law following the Surabaya
deforestation, Indonesia is a major emitter of greenhouse
attacks, lengthening periods in which suspects can be
gases—the world’s third or fourth largest when emissions
detained without charge and broadening police rights to
from deforestation are taken into account. Illegal logging
prosecute those who join or recruit for militant groups.
remains rampant. In the 1960s, forests covered 82% of
U.S.-Indonesia counterterrorism cooperation is close; the
Indonesia; today, they cover 49%. Extensive wildfires
United States and Australia helped to create Indonesia’s
cause severe air pollution each year. The United States
elite counterterrorism unit, Densus-88, which has weakened
conducts numerous environmental and clean energy
militant groups such as Jemaah Islamiyah (JI), an al-Qaeda
programs in Indonesia. A $600 million Millennium
affiliate responsible for several bombings in the 2000s.
Challenge Corporation (MCC) compact took effect in 2013,
with about $332 million devoted to a “Green Prosperity”
program aimed at renewable energy and land management.
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Indonesia
IF10247
Ben Dolven, Specialist in Asian Affairs
Disclaimer
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https://crsreports.congress.gov | IF10247 · VERSION 9 · UPDATED