Jakarta. The smooth transition of power from the outgoing President Joko “Jokowi” Widodo to President-elect Prabowo Subianto is expected to positively impact Indonesia’s investment climate, according to an economist.

Esther Sri Astuti, an economist at think-tank Indef, said investors would consider Indonesia a safe and prospective destination for their investments.

“As long as the government can ensure the legal certainty and granting that investment certainty by convincing them that they would not change the policies. I believe this would be a boon to businesses,” Esther said on Tuesday.

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Prabowo, who will be inaugurated as the next president this October, has promised continuity of Jokowi’s programs. Jokowi oftentimes also often brought up the need to make sure that he could effortlessly hand over the presidential baton to Prabowo. Esther said that in times of changing presidencies, investors would keep an eye on whether there would be changes to policies that could impact businesses.

“All this time, the top complaints from investors are law uncertainty or laws that are still susceptible to change. That [law uncertainty] is what worries investors when investing in Indonesia,” Esther said.

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The analyst added that Prabowo’s commitment to carry on Jokowi’s policies could get rid of investors’ fears over uncertain policies. Prabowo’s decision to have Jokowi’s son Gibran Rakabuming Raka as his vice president is also another proof to the continuity.

“I would say this is the smoothest transition of power, especially since we have Gibran as the vice president. Mr. Jokowi and Mr. Prabowo must have made agreements to make sure that the former’s policies do not stall halfway. Continuity is what the Prabowo government has promised,” Esther said.

Indonesia aims to attract Rp 1,650 trillion (around $106 billion) throughout 2024. The country has already passed the halfway mark as of the first half. The government is mulling on raising the target to Rp 1,905 trillion next year. 

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