Jakarta. Many politicians, economists, and other domestic stakeholders have started to discuss the flagship economic policies of Prabowo’s administration.

From having a high gross domestic product (GDP) growth target of up to 8 percent, self-sufficiency in food and energy, poverty eradication and re-industrialization, people have anticipated what Indonesia's economic development would be directed to. However, it is also important to start having an outlook on the country’s international affairs under Prabowo’s leadership.

While we are still waiting for his official foreign policy signature after his inauguration in October 2024, the projection of how he would position Indonesia itself amidst the global dynamics might be useful. No one except him knows the decision at this stage. 

As we know, "changes" are the most certain thing in the global economic and political situation, while uncertainties on how it would affect the world countries follow. The world is moving so rapidly, and often we can see many things evolve in only a few days. 

When many things might still continue its path, Indonesia under Prabowo’s time is expected to live within the changing global landscape. Before breaking down into some real cases of these shifting trends, we must understand two things:(1) Indonesia’s economy is significantly integrated into the regional and global ecosystem; (2) Prabowo’s economic narratives such as self-sufficiency will be highly inter-related to Indonesia’s foreign engagements. Thus, this writing is relevant. 

The Revival of Global Economic Nationalism 

Prabowo will face the emerging risks of global economic nationalism, particularly those triggered by the continuous tension between the United States and China. The perceived sense of losing the economic competition by many major powers will also spark wider nationalistic-based policies. Recently, the imposed high tariffs for Chinese-made EVs are expected to provoke retaliation. Import restrictions, also often used by countries along with political-environmental reasonings, will intensify disruptions in the global supply chain. 

Unfortunately, countries are responding by becoming more protectionist of their domestic economy, invalidating its free trade commitments, disputing the disagreements, and further losing reciprocal confidence and trust. The world countries also try to diversify their partners and commodities, looking for alternative options and markets. However, the foreseen cost of this trend is an escalating global economic fragmentation. 

The right narratives of Indonesia’s self-sufficiency in several sectors under Prabowo’s administration must be promoted, to ensure that it can go along without risking the existing economic partnerships. For instance, his vision of energy security regarded as pivotal to national defense will be instrumental for the next five years, but it must not neglect the importance of sustaining and expanding the scope and scale of foreign investments to our energy sector. 

The Global Rebalancing of Power

The multipolar world tends to find a perfect tune of an ‘imperfect’ global order. While it sounds cliche, countries are asserting their influence to balance the existing world order. Realizing that the great powers’ rivalry is not a short-term period, many more states are positioning their path to take the most benefits out of the geopolitical contest. 

BRICS is now expanded as a grouping perceived to counter the West dominance and denunciation against the US-led world order. Just recently, Thailand and Malaysia lined up showing their intention to be part of BRICS with the narratives of proactively promoting multilateralism. 

Besides, some strategic economic tools flexed or involved by China also tried to push for Asia-centric geo-economic order, including the Belt and Road initiatives, Digital Silk Road and even RCEP. Indonesia under Prabowo is expected to well-navigate the country from this ongoing trend of global power restructuring or even play an active part in shaping the regional architecture, as in the Global South. 

The Competition is Here: Southeast Asia

Prabowo on many occasions has mentioned the "Good Neighbor Policy" as potentially the flagship foreign policy stance of his governance. Having less elaboration now, we may estimate his ultimate concerns on regional peace, stability, and solid cooperation as the key determinant of Indonesia’s growth. 

Southeast Asia is indeed an extremely unique grouping. Member countries are committed to sharing their economic development despite significant dissimilarities. With different economic systems, all Southeast Asian states are committed to better integrating their institutional, physical, and digital connectivity. 

However, what is common in Southeast Asia today is its very vibrant economic competition. Vietnam with its rising manufacturing appetite and capabilities due to its more predictable policy governance, Malaysia with its stronger presence in the global technological value chain through its robust semiconductor industry and Singapore as a financial hub and aspires to be the renewable energy hub of Asia. 

Indonesia might have the opportunity in many sectors but has not identified its clear regional specialty. Prabowo is expected to review Indonesia’s competitive advantage in the midst of changing regional economic dynamism. Indonesia has to take optimal benefits from regional instruments such as the Digital Economy Framework Agreement (DEFA) and also the ASEAN Carbon Neutrality Strategy to map out key opportunities. 

Interestingly, we all see more active and assertive leaders in ASEAN as another boost for regional relevance to global growth, Prabowo is included. As much as foreign policy is decided by domestic policy imperatives, the global situation gives significant determination to the country’s position, and Prabowo will definitely take this not for granted.  

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Noto Suoneto is the VP for International Affairs at the Indonesian Business Council (IBC). The views expressed in this article are those of the author.