Previously, at the 2021 National Development Planning Conference, Widodo said that if Indonesia could implement this agenda, the country could achieve its national development. 

Indonesia has made efforts to reduce gas emissions by switching from fossil fuels to green energy. At the 2022 G20 Bali Summit in Bali, Indonesia, the country launched the Just Energy Transition Partnership (JETP). This partnership relies on a financing scheme of $20 billion from the member countries International Partners Group (IPG) — European Union, United States, Japan, Canada, Denmark, France, Germany, Italy, Norway and the United Kingdom — and is coordinated by the Glasgow Financial Alliance for Net Zero (GFANZ). Each of them provided funds amounting to $10 billion.

Indonesian Minister of Foreign Affairs Retno Marsudi handled diplomacy with other countries. For example, Marsudi met with the Norwegian Minister of Foreign Affairs Anniken Huitfeldt by agreeing to a Memorandum of Understanding on the forestry sector; Norway is committed to assisting Indonesia with $250 million in the context of implementing JETP. According to a statement from the Ministry of Environment and Forestry, the current efforts make Indonesia optimistic about reducing its greenhouse effect from 29% to 41% by 2030.

Indonesia lacks commitment to green energy

Despite Indonesia’s optimism, the country must overcome great challenges in carrying out the energy transition. The country has repeatedly issued statements regarding clean energy, but talk isn’t enough; it must fulfill its commitments. Its primary energy remains driven by non-renewable fossil fuels. The Center of Economic and Law Studies (CELIOS) released a study in 2024 showing that Indonesia’s dependence on coal and oil is enormous. Two of the reasons are the economic price and the vast potential space for miners. This is why Indonesia still experiences an “addiction” to non-renewable energy.

The coal sector increased from 100.51 million barrels of oil equivalent (BOE) in 2018 to 167.41 million BOE just one year later. A figure in CELIOS’s study shows a peak in 2022 of 299.19 million BOE. Although there is a decline in 2020 and 2021, it does not show a significant figure.

The weakness of Indonesia’s commitment is plainly obvious when looking at private and state banks, which support the non-renewable project. Take the coal mining company PT Adaro Energy Tbk as an example. In May 2023, Bank Mandiri, Bank Negara Indonesia, Bank Rakyat Indonesia, Bank Central Asia and Bank Permata contributed $1.75 billion for the construction of the Steam Electricity Power Plant (PLTU, abbreviated based on the Indonesian spelling) with 1.1 gigawatts in North Kalimantan.

According to Bhima Yudhistira, Director of the Center of Economic and Law Studies (CELIOS), this disbursement of funds shows that the rate of return for loan funds is still high. In fact, there has been a great deal of encouragement in the construction of the Adaro project to move away from coal. Several banks, such as CIMB Niaga Bank, Standard Chartered, Mizuho Bank and HSBC Bank, withdrew from the coal business.

The green energy mix target for 2030 reaches 44%. Harryadi Mahardika, Director of the Clean Transition Program, says that Indonesia’s noncommitment toward the energy transition is also accompanied by an increase in the 35 Gigawatt Program electricity initiative. The majority of this remains dominated by coal-based PLTU.

In 2023, the publication Kompas revealed that out of Indonesia’s total energy consumption the previous year, renewable energy made up only 12.3%. This is an increase of 0.1% from 2021. The data shows that Indonesia still needs to reach the government’s target of 23% in 2025. The government even failed to meet the 15.7% target in 2022.

According to Amin Nasser, CEO of Saudi Arabia’s Aramco oil company, reducing gas emissions is just a ‘fantasy’ for the country. Naseer predicts demand for gas will increase in the next few years rather than decrease. Therefore, Indonesia and other countries clearly lack commitment to the green energy initiative.

The JETP scheme needs crucial clarification

Another issue is that the JETP scheme has yet to be clarified. The IPG’s financing will come in the form of debt. However, economists fear this could burden the fiscal sector, resulting in Indonesia entering a debt trap. In 2023, the data company Katadata found that 60% of Indonesia’s debt will be concessional loans, 17% will be in the form of guarantees from the US and UK through the International Bank of Reconstruction and Development, 14% will be non-concessional and the remaining percentage will be in the form of equity investment and grant funds. Additionally, the GFANZ group needs to share financing details. This can be dangerous if the Indonesian government is not careful.

The launch of the Comprehensive Investment and Policy Plan for the JETP (CIPP JETP) had little impact on the situation. Before its publication, Indonesia had launched its Energy Transition Mechanism (ETM) with the Asian Development Bank (ADB) on November 3, 2021. In the CIPP JETP document, Indonesia decided that the Cirebon-1 PLTU, with a capacity of 1×660 megawatts, would retire early in 2035. The Pelabuhan Ratu PLTU would then retire in 2037.

Even though they are already in the ETM, these two PLTUs remain a priority for early retirement in the CIPP JETP document. According to the government, this pension policy is a compliance action to reduce global emissions. However, this step is repetitive — Indonesia has never been serious about solving environmental problems by diversifying other PLTUs.

Similarly, PLTU Suralaya and PLTU Paiton will be targeted for early retirement. However, Wahyudi Iwang, the Executive Director of WALHI West Java, pointed out that the early retirement schemes for PLTU Cirebon-1 and Pelabuhan Ratu do not reflect the principles of justice. Iwang stated that in the ETM scheme, the ADB did not inform the public of the decision’s consequences. One way is to use technique co-firing. Based on reports and research results from the Center for Research on Energy and Clean Air and the Institute for Essential Services Reform, this technique can only reduce emissions by around 20%. Fortunately, that will still make a positive impact on air pollution, and especially on public health.

The energy transition must (but can’t) be equally distributed

The third problem to consider is that not all regions can make an energy transition. This is a negative trend in the context of the equal distribution of green energy. Researchers Media Wahyudi Askar and Achmad Hanif Imaduddin’s study, “Indonesia’s Energy Transition Readiness Index: Mapping Current Conditions and Navigating the Future of the Energy Sector,” shows that DKI Jakarta occupies the top position with a score of 84.24, followed by Special Region of Yogyakarta (66.4), Banten (58.5), Central Java (55.22), West Java (55.19) and East Java (52.89). Simultaneously, provinces outside Java cannot follow the energy transition trend, such as Papua, Central Sulawesi, Bangka Belitung and West Papua; the majority of them score below 40.

According to Askar and Imaduddin, provinces with high averages are supported by sufficient financial capabilities. For example, until 2020, as many as 90% of Solar Power Plants (PLTS) were still located on the island of Java. Provinces with low scores need help due to, among other things, the electrification ratio. When compared on a national scale, these provinces are below 99.2%.

Another challenge is human resources. Provinces with low scores tend to have low human resources for understanding foreign languages ​​and technology, such as computers and electronics.

We can conclude that the Indonesian government’s commitment to implementing a green energy transition needs improvement, especially when the government failed to implement mixed energy towards net zero emissions. Apart from the country’s minimal commitment, the energy transition in Indonesia still needs to be characterized by unclear JETP schemes and equal distribution in each region. Based on this, it is obvious Indonesia is not ready to carry out the green energy transition.

[Lee Thompson-Kolar edited this piece.]

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

The post Why Indonesia’s People Will Fail to Transition to Green Energy appeared first on Fair Observer.

Subianto is expected to continue the policies of the incumbent president, Joko “Jokowi” Widodo. (Jokowi is also the father of Gibran.) Since 2019, Prabowo has served as the Minister of Defense and helped Jokowi to run several military projects, including importing vaccines from China. Economic relations, for example, between Indonesia and China soared during the Jokowi era. The Indonesian Central Statistical Agency (BPS) noted that Indonesia’s trading partnership with China, which reached more than $130 billion in 2022, has increased significantly since 2014, which was the first year of the Jokowi era.

Prabowo and Gibran gave their victory speech in front of millions of supporters. Soon after, China shone the spotlight on Prabowo. Foreign ministry spokeswoman Mao Ning congratulated Prabowo and expressed hope that the relations between Indonesia and China would grow in the upcoming years.

I argue three things. First, Prabowo’s win is momentum for China, and the ties could continue to be more substantial. Second, Prabowo, who has a military background, will enhance the government’s relationship with the military sector. This could justify the criticism that Prabowo lacks knowledge about the economy. Third, Prabowo will likely cooperate with China’s international partners, mainly Russia.

Continuing Jokowi’s policies

Prabowo has long had solid ties with Jokowi. His posture and verbal statement during the presidential debates suggest his commitment to continue Jokowi’s programs.

Prabowo frequently stated that the development of downstream processing sectors (as opposed to raw material extraction), is his top priority policy. This is a continuation of the Jokowi administration’s outlook. Prabowo has emphasized the importance of nickel processing projects in Sulawesi and Maluku to Indonesia’s economy.  “Nickel is an element needed by industries, and we have nickel, one of the largest [nickel reserves] in the world,” Prabowo said at the Trimegah Political and Economic Outlook 2024 event in Jakarta on January 31.

The nickel industry cooperates heavily with Chinese ventures. China is the main export destination of Indonesian nickel. In 2020, Jokowi’s government banned the exportation of raw nickel, encouraging Chinese firms to invest in nickel processing within Indonesia.

Before the downstream program, Indonesia’s nickel ore was mostly exported and sold for cheap on the international market. Jokowi and Prabowo’s bid to expand domestic processing seeks to keep more money within Indonesia and also to make Indonesia a base for electric vehicle battery manufacture. Prabowo hopes to expand the downstream sector into dozens of other commodities, such as bauxite, from which aluminum is extracted.

Related Reading

How Latin America Should Handle the Lithium Boom

Rhetorically, Prabowo is against those who say that the downstream could not be beneficial to Indonesia. “People’s thinking is so messed up. I really don’t understand them,” he has remarked.

The new capital city of Nusantara, another of Jokowi’s signature projects, is a concern to Prabowo’s team. Continuing in Jokowi’s steps, Prabowo will accelerate the flow of investment into the city and engage China as the biggest partner.

Military expansion?

In 2021, Indonesia experienced the tragedy of the sinking of the KRI Nanggala 402 in the waters around Bali. China’s role in the situation was very significant. Chen Yongjing, military attaché of the Chinese embassy, deployed the tug Nantuo 195 and the Xin Dao 863 to assist the Nanggala. Prabowo, as minister of defense, thanked China for the assistance at the 15th Association of Southeast Asian Nations Defense Ministers Meeting.

Prabowo has frequently communicated with China. In December 2019, for example, Prabowo embarked on a trip to seven countries, including China, holding rendezvous with National Defense Minister General Wei Fenghe and Vice Chairman of the Central Military Commission General Xu Qiliang and the State Administration for Science, Technology and Industry for National Defense. The plan for the visit was to purchase a sea patrol vessel worth $200 million. However, specific details of the type of the vessel remain undisclosed.

After the Indonesian government announced the spreading of COVID-19, Indonesia redirected its policy to re-focus on reducing the number of victims by providing vaccines. Prabowo again visted China to arrange for the importation of vaccines.Millions of vaccines were imported in early 2020, and this number increased significantly in 2021.

Prabowo communicated with China in November 2022, when he met with General Wei Fenghe, planning joint military exercises between the two nations and the collaborative enhancement of military education standards. The dialogue between Jakarta and Beijing also occurred in the 2023 Shangri-La Dialogue in Singapore and their participation at the Defense Industry Cooperation Meeting (DICM).

In January 2024, the Indonesian ministry of defense showed interest in purchasing the Chinese YJ-12E coastal missile system. According to Global Times, this missile boasts a range of up to 290 kilometers and possesses significant penetration capabilities, enabling it to incapacitate vessels weighing up to 5,000 tons.

Prabowo envisions building a domestic military industry in Indonesia. Currently, in the Stockholm International Peace Research Institute’s top 100 rankings of military industries in the world, tiny Singapore ranks 55th, while Indonesia does not even place. Indonesia looks to China to increasing the technology transfers in hopes of transforming the archipelago nation into a Southeast Asian center for exporting military parts.

Will Indonesia be able to embrace China’s international partners?

As Indonesia expands its ties with China, Prabowo is also preparing to reach out to other international partners of China. This is one of Indonesia’s strategies to embrace the value of harmony and become a great country. Chief among those partners is Russia.

The strategic alliance between Russia and China is significantly shaped by their arms trade and military collaboration. Before its emergence as one of the world’s preeminent arms exporters, China relied heavily on Russia to provide weapons. Russia’s contribution to China’s military modernization through technology transfers and other means has been instrumental.

Furthermore, in the past decades, Russia and China have conducted military exercises, such as naval and air patrols in the Asia-Pacific. It could be a signal that both nations are the key players in the region. Last year, China and Russia conducted maritime patrols around Alaska. Besides, economically, the ties of Russia and China have reached a remarkable mark. In 2022, for example, Russia has replaced Saudi Arabia as China’s biggest partner in crude oil, accounting for 19% of China’s total imports last year.

It is anticipated that Prabowo will be able to seamlessly develop a working strategic relationship with his Russian counterpart. This will be a component of a broader strategy aimed at preserving Indonesia’s sovereignty amidst the geopolitical rivalry between China and the US. Nevertheless, the West poses a substantial challenge through the implementation of the Countering America’s Adversaries Through Sanctions Act.

Some “rational” choices that Prabowo will make in his tenure are never abandoning China and expanding ties with Russia.

[Gufron Gozali, a master’s student at Universitas Muhammadiyah Yogyakarta, Indonesia, majoring in International Relations (IR) contributed to the article.]

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

The post Prabowo Easily Wins the Indonesian Presidency: What Next? appeared first on Fair Observer.

Of Human Bonds: Between Sex Work and Trafficking

READ MORE

In Indonesia, there is no official data recorded about sex workers. As a result, these individuals do not have the same chance of receiving the same state benefits as other citizens. As reported by the United Nations Population Fund (UNPA), one example is Mirna, a 30-year-old sex worker. She struggles to pay her bills due to meeting fewer clients. She also does not have access to food aid from the local government as she does not hold an ID card for Jakarta, the Indonesian capital.

Sex Work and Violence

There is no explicit law in Indonesia that prohibits prostitution, making the trade of sex for money technically legal. Yet, as The Economist reports, “some local governments have used an ambiguous ‘Crimes Against Morals’ law to ban sex work in their districts.”

Many sex workers experience barriers when reporting violent crimes against them. These range from social shame to charges for engaging in prostitution. Those who work in the trade, particularly women, are often vulnerable to extreme violence. They face the risk of rape, assault, harassment or death, and the victims are usually blamed.

The National Women’s Commission has collected data on violence against sex workers. As of 2018, “violence in the public domain reached 3,528 cases (26%), where sexual violence was ranked first with 2,670 cases (76%).” This was “followed respectively by 466 cases of physical violence (13 %), 198 cases of psychological violence (6%), and special categories, namely trafficking (191 case, 5%), and 3 cases related to migrant workers.” According to the National Commission on Violence Against Women, three Indonesian women are at risk of sexual violence every two hours.

Budi Wahyuni, the deputy chairperson of the National Women’s Commission, has called prostitution a harsh trade. She has argued that sex work is full of threats of sexual, physical and psychological violence. According to her, violence and coercion go hand in hand with the world of prostitution.

In Indonesia, where the dominant religion is Islam, the issue of violence against sex workers has not received enough attention. Many Muslims in the country consider sex workers to be criminals who violate religious norms and, therefore, should not be accepted by society. This situation makes it difficult for sex workers to receive sufficient state protection and resources, including access to health care.

Research by international agencies such as UNFPA shows that the trade of sex in Indonesia is unsafe. Many pimps cannot guarantee the availability of condoms to protect sex workers, which leaves people at risk of sexually transmitted infections (STI) or HIV/AIDS. Sex workers are also vulnerable to violence by law enforcement officers as well as psychological trauma.

The Indonesian Organisation for Social Change (OPSI), a nonprofit that provides training programs and reproductive education for sex workers, found that in the last five years, many brothels were shut down by local authorities. The closure of these sites has made it difficult for facilitators to conduct health programs for sex workers, including protecting them from violence, trafficking or contracting STIs.

What Can Be Done?

It is clear that more needs to be done to help victims of sexual violence, especially those who work in the sex industry. Three areas deserve close attention.

Make Sense of the World

Unique Insights from 2,500+ Contributors in 90+ Countries

I agree to receive emails and other content from Fair Observer. I understand that I may repeal my consent at any time. You can review our Privacy Policy and Terms of Use for further information .

First, the anti-sexual violence bill must be signed. “The bill defines sexual violence as physical or non-physical violence that makes someone feel intimidated, insulted, demeaned or humiliated,” Inside Indonesia reports. “The bill acknowledges that sexual harassment, sexual exploitation, forced contraception, forced abortion, forced marriage, forced prostitution, rape, sexual slavery, and sexual abuse are all forms of sexual violence.” By including these terms in the bill and seeking to tackle abuse, the state can better protect sex workers. Most importantly, the bill “includes providing health services and legal assistance for victims.”

Second, the government must educate those who consider trading sex for money to be immoral. Many Indonesians ignore the fact that some people become sex workers out of necessity. For some, selling sex is the only way to put food on the table. As the majority in Indonesia, Muslims can play a key role in helping to change the social narrative around sex work.

Third, the government should learn from New Zealand. In 2003, New Zealand abolished criminal penalties for sex workers and sought to provide access to health services to reduce the risk of HIV/AIDS. Taking this step in Indonesia would help remove the social stigma around sex work and create a safer environment for those who engage in the trade.

In Indonesia, the issue of sex work is still a taboo subject. The “work” dimension of sex workers is considered nonexistent. Apart from the government, few civil society organizations have opened discussions about sex work. Instead of generating debate and addressing concerns, sex workers are shunned by society.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

The post Should Indonesia’s Sex Workers Be Protected? appeared first on Fair Observer.

Does the World Need to Contain China?

READ MORE

Since becoming president, DPP leader Tsai Ing-wen has challenged Beijing’s “one-China policy.” In 2020, she declared that Taiwan could not accept reunification with China under its “one country, two systems” offer of autonomy. Taiwan’s first female president said that “Both sides have a duty to find a way to coexist over the long term and prevent the intensification of antagonism and differences,” pouring cold water over Beijing’s long-cherished hopes of reunification.

Chinese Aggression, Taiwanese Response

China has responded aggressively to Taiwan’s position. In a recent article, Lee Hsi-min, a retired Taiwanese admiral, and Eric Lee, an Indo-Pacific security analyst, point out that the CCP “is already taking action against Taiwan.” For years, China has undertaken incremental military measures against its tiny neighbor. Beijing has been careful not to cross the threshold of armed conflict, but its sub-conflict operations have been relentless.

These operations have come to be known as gray zone aggression. They involve airspace incursions, coastal violations, cyberattacks and disinformation campaigns. A recent report by the Center for Strategic and International Studies found that Chinese aircraft had entered Taiwan’s airspace 20 times in the first eight months of 2020. The Chinese People’s Liberation Army (PLA) has stepped up its air and naval operations. Fighter and bomber aircraft frequently circumnavigate Taiwan as a show of force. Chinese aircraft carriers have been on military exercises and “routine” drills in waters near Taiwan.

This is part of China’s increased aggression in its neighborhood since Xi took charge of the CCP, with Beijing doing all it can to undermine Taiwan’s institutions, demoralize its society and undermine popular support for a democratically elected government. However, Taiwan has responded robustly to this aggression. In April, the Taiwanese foreign minister vowed that his country would defend itself to “the very last day.” Taiwan is spending more on defense, strengthening military ties with allied powers and even preparing for a potential war to retain its independence.

Indonesia’s Balancing Act

As tensions rise between China and Taiwan, Indonesia has been forced into a delicate balancing act. China is Indonesia’s largest trading partner, a big source of investment and a supplier of COVID-19 vaccines. In 2019, bilateral trade reached $79.4 billion, rising tenfold since 2000. Indonesia has even started using Chinese currency for trade in a historic move away from the US dollar. 

In 2020, Chinese foreign direct investment in Indonesia, including flows from Hong Kong, reached $8.4 billion, rising by 11% in a year. A 142-kilometer Indonesian rail project is part of China’s Belt and Road Initiative and is expected to cost $4.57 billion. In April, Xi met Indonesian President Joko Widodo and promised to boost Chinese investment further. Xi said the two countries should increase infrastructure projects such as the high-speed rail link between the capital Jakarta and Bandung, a major Indonesian city.

Before the pandemic, 2 million Chinese tourists visited Indonesia every year. Jakarta’s nationwide vaccination campaign is using China’s Sinovac COVID-19 vaccine. (So far, the West has failed to provide Indonesia with vaccines.) Derek Grossman, a senior analyst at the RAND Corporation, has argued that Indonesia is quietly warming up to China.

Even as Indonesia develops closer ties with China, it is also deepening its relationship with Taipei. Taiwan’s track record in tackling the COVID-19 pandemic has been spectacularly successful, and Taipei has donated 200 oxygen concentrators to Jakarta. Even though it has been criticized for the recent rise in cases, Taiwan is still a role model for a country like Indonesia, which needs all the help it can get.

Like the US, the UK and many other countries, Indonesia does not recognize Taiwan’s independence. However, trade between the two countries is rising. In 2019, Taiwanese investment in Indonesia crossed $400 million. The previous year, trade between the two countries surpassed $8 billion, growing by 15.7% in a year. President Tsai’s “new southbound policy” is starting to yield results. 

Indonesia has to be careful in handling its relationship with both China and Taiwan. Recently, Japan’s deputy defense minister suggested that Taiwan “as a democratic country” should be protected from China. The statement triggered fierce condemnation from Beijing. Jakarta should to avoid any pronouncement that may upset Beijing, Taipei or even Washington. Indonesia needs economic growth, increased investment and collaboration with all major powers.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

The post Indonesia’s Balancing Act Between China and Taiwan appeared first on Fair Observer.