 My name is Vikram Nehru. I'm a senior associate here in the chair in the Southeast Asian studies. It's good to have all of you with us. My voice is a bit down. Actually, there are two reasons for this. One is that India lost to Australia in the World Cup today, so I'm feeling somewhat low. The other reason is also that I've got a bit of a cold, so I hope you don't mind if I there's the occasional sniffle or cough. I'll turn off the mic as soon as I finish speaking, so you'll be spared the sound. Well, it's been five eventful months since President Jacobi assumed office in Indonesia. And the president has since faced significant political challenges in a slowing economy at home and has undergone a baptism of fire in international relations, an area that he's not particularly comfortable in. In the world, and even Indonesians knew little of Joko Widodo before he became president. He's a product of Indonesia's decentralization policy and blazed a trail to the national scene from modest beginnings as a mayor in a middle-sized city in Central Java. And in some ways, his first few months in office have shown him to be an impressive leader. But in other ways, he appears to have been surprised by the cutthroat politics of Jakarta. His stance on economic issues now gradually being revealed also appears to have received mixed reactions by observers, including incidentally myself. So to make sense of all of this and to give us an insight into this person as well as the complexities of politics and economics in Indonesia, we're very lucky to have Jim Castle who's been here before, many of you know him. He is an expert on Indonesia. He's lived in Indonesia now for almost 40 years and is the founder of Castle Asia, which he established in Jakarta in 1980. And Castle Asia manages the largest and most prestigious CEO forum in the country, counting amongst its members over 130 of Indonesia's best and largest corporations and institutions. In addition, Jim advises foreign investors in Indonesia and serves on the board of many companies. And he's a senior advisor at McClarty Associates here in Washington, DC. He has been a consultant to numerous government and international agencies, including the World Bank, the ADB. He's an honorary professorial fellow at Monash University, where he's also on the board of the Australia Indonesia Center. And he's a frequent media commentator on Indonesia in business and politics. So welcome, Jim. Jim will speak. He has a PowerPoint presentation. And after he speaks, I might have a few questions for him. And then we'll open it up to the audience. And hopefully, we'll be able to wrap it up in 90 minutes. Over to you, Jim. Oh, Victor, thank you very much for inviting me. It's always a pleasure to be here at Carnegie. It's one of Washington's great institutions. And it always brings out a lot of friends. So great to see everyone. And it's a pleasure to be here. I'll do my best to live up to that pretty expansive billing. Thank you for that. I know a number of you are at the very good talk that Ambassador Blake gave on last Tuesday. It showed hands, a few people. A, it was a very good talk. And I hope I can add a little bit. I don't know how much I can add. But I also learned something a little bit different on speaking techniques. I learned about the bluff and the blab. And he talked about, when the State Department and Defense get together, Defense says, State Department always does blab. That's big line at back. They save their best line for the end. Whereas the Defense Department is all bluff. Big line up front, bluff. So the bluff and the blab. When I was doing my talk last night, different connotations for those words came through my mind. But in any case, I do have some bluffs for you. And I'll start with those bluffs. I have three bluffs. But a first, a little story. Years ago, I met, there was a new British ambassador who came to Jakarta. And he was telling this story. And he said, you know, when I was back in London, and people learned I was coming to UK, coming to Indonesia, one of my friends said, I hear you're going up to Jakarta. Yes, you know, he says, oh, you're going to be disappointed. And he kind of taken it back. And he said, disappointed, well, what do you mean? He said, well, Indonesia's a disappointing country. What do you mean, disappointing country? He said, well, you know, it disappoints the optimists and it disappoints the pessimists. And of course, I think people tend to overreact in both directions to whatever is going on in Indonesia. I think the most extreme case, of course, was 1997-98, which is a true crisis and turning point. And people legitimately worried about the future of the country. But as we can see now, nearly 20 years later, Indonesia's come through that with a very robust democracy. But democracy presents its own challenges. And I think Jakowi, you could say, has maybe disappointed some of the optimists. But I think he's also surprised some of the pessimists. So my own view is that in terms of politics, Jakowi's disappointed the pessimists and will continue to do so. I think he's done a very skillful job in expanding his base for minority position. And I'm optimistic that he'll be able to consolidate a functioning majority going forward. On the economic side, I'm afraid Indonesia will disappoint the optimists, including those in the government and outside the government. I think that's the 7% growth target for 2017-18 is a bridge too far in the current policy environment. And I'll say, well, I'll go into more details shortly. Basically, slowing commodity prices and very poor policy choices have put Indonesia in a very difficult economic position. Although the negative policy environment has been somewhat neutralized by the conservative fiscal management and the beneficial effects of decentralization, accelerating growth is gonna be a major challenge in the next couple of years. And my third and final bluff is that I would like to emphasize that Jakowi is truly a different leader and could well be a transformative figure and change the nature of Indonesian politics and governance for the better. And why do I say that? Well, it's another kind of maybe a bad joke, but the joke was when I think President Wahid, Indonesia's fourth president, told it on himself. He said, you know, Indonesia's always had these crazy presidents. So Karna was crazy about women. So Harfa was crazy about money. Habibi was crazy about technology. And me, I'm just crazy. So, and he was certainly an eccentric leader, although I believe a great man, even though his presidency didn't go well. But what we've had are huge egos and huge insecurities at the top of Indonesia. That's not unusual. I think we have a couple here in Washington that we could probably talk about for a minute or two. But basically, what evolved over the decades of Indonesian independence was a huge sense of entitlement of the Jakarta elite. And this is being shattered by the decentralization and Jakowi is really a nail in the heart of the Menteng elite. And the interesting thing is unlike the previous presidents, Jakowi is completely comfortable with himself. He's a small town business man. He is what he is. He does what he does. And if you don't like it, it's really your problem, not his. And that really shows through in his leadership, which is unsophisticated by national standards, international standards. But it's a true, genuine feeling. And the most important thing about Jakowi is he's now been in public life for about seven, eight years. And there's not a single financial scandal attached to him or his family. This has never happened in Indonesia. Never. At almost any public position. So he really is not in it for the money. He's not in it for the glory. He's in it really to push his vision for Indonesia. And it's a vision of integrity and honesty. And we'll go into more detail on that, but that's where he's transformative. And that's his real challenge. When we talk about the political side, we'll go into more depth there. But finally, in reference to Ambassador's late talk, and I'm not an expert on foreign affairs by any stretch of the imagination. But American, US-Indonesian relationships are, as I think I can say this, Ambassador said, they're good in getting better. And we do have a very robust relationship. We've had it ever since, we've had it for a very long time, but certainly it improved under democratic Indonesia. And we've had a very good relationship with all governments. And a number of the things I think we can cite are the Very Act and Millennium Challenge Program, the Maritime Focus Coast Guard Development, some military training and sales, an increase of students, Indonesian students in the United States, 8,000, still relatively modest, but up from 4,000 or 5,000 that it was some years ago. Jacqui's visit coming here in the late May, business interest, the Ambassador said, he has these regular conference calls where he dials into the US and people can dial in and talk about economic matters, the US Chamber in New York and others organize this. And they usually have 20, 30 people on the call. His last call, he had over 100. So that's a testimony to the interest of American business in Indonesia. Jacqui said something very interesting in Japan that we're still trying to parse and that his view of China's nine dot line, which is very favorable from the US point of view, but may cause him some grief. I think he's in China today, so we'll see how that plays out. But basically he is taking a very interested, an interesting view of the expansion in China and the region. And obviously he's visiting, he just came from Japan, he went to China, he'll be coming to the US. So he's visiting really the major powers that affect Indonesia. Bottom line, however, in this, I think in terms of business and trade, both sides are disappointed in the volumes in both directions. I think the trade and investment should be much higher in both directions than it is. So these are my blows. So talking a little bit more about politics and what greeted Jacqui when he came, when he took office on October 20th. Resistance to reform, isolationism, deficits, protectionism and the resource trap. But the major issue of course, if we rewind back to the very contentious election where he won 57 to 43 over a very ambitious aggressive challenge by Prabowo Suvianto. And a lot of bitterness at the end of the campaign because Jacqui was swept over the line, although the last week of the campaign he was probably the underdog and Prabowo fully expected a coronation. Basically social media got Jacqui over the line. And Prabowo took it very badly with court challenges, very ill-tempered remarks and so on. And the fact that his coalition was the larger coalition in terms of parliamentary democracy. So there was a lot of worry that we would have a tie-like situation evolve where there was just a stalemate where the parliament said the executive can't govern therefore we have to start over. And there was this challenge to the constitutional court which upheld the validity of the elections. And then the mood started to shift. I think the behavior of the opposition was not well received by the general public. My own view is if the election had been held a month later after that behavior, Jacqui's margin would have been significantly higher. So what happened was the parliament, the new parliament took office on October 1. The new president didn't take office till October 20th. So the parliament had to head start. And because they were a majority they were very aggressive and they immediately passed a law, changed the administrative law on the structure of parliament which basically gave them all the seats and the minority nothing. Which was contrary to previous practice and more importantly contrary to Indonesian sense of fairness. And there was a real resistance to that. And months later with no real formal pressure they rescinded that and have gone back to having all the parties represented on all the committees. But initially they looked like it was gonna be a total freeze out and they were against the government. They were going to block the fuel price height and they were going to pass a very unpopular bill eliminating direct local elections. If you fast forward to January the president's budget passed unopposed and he got his bill of direct local elections passed unopposed. So within a two month, three month period they went from total opposition to total compliance. At the same time there was a bitter battle over the nomination of a new police chief which we can talk about later. So the ground shifted and Jacobi basically remained low key and didn't respond to any provocations and Wei did kind of a rope-a-dope Muhammad Ali type of thing and let the opposition punch themselves out and just look bad in public. And that seemed to work. At the same time, once he was inaugurated on October 20th he just went about running the country. Now what he understood that SBY never understood was the executive power of the presidency. The presidency is structurally relatively weak say compared to the American presidency because the president only gets about 40 direct appointments. The US president gets several thousand and I never have been able to get the right number. But I think the US president, and correct me if I'm wrong, can put someone pretty much anywhere in the federal bureaucracy that he wants. Whereas in Indonesia that's not the case. So that alone weakens the Indonesian president in terms of bringing in new people in a department. So but what he did do was just start running the budget. And he eliminated, he drastically curtailed the fuel subsidy. And parliament said, wait, you didn't talk to us. He says, I don't have to talk to you, it's just in the budget. Well, you can't spend the money. No, I can't, but I'm gonna give you a new budget and you can pass it. And if you tell me not to spend it, I won't spend it, that's up to you. But meanwhile, I'm just doing what you guys passed in the recent budget. What's your problem? And they never seen anything like this. And we know SBY, his predecessor was a very cautious person. And he would seem to, if there were 10 people in the room and nine said yes, he'd keep asking until he got a no. And then he'd say, oh, we have a no, what are we gonna do? Whereas Jacobi doesn't, he said, I'm elected, I'm doing this, give me a call if you have a problem. So he showed the executive power of the presidency. Now this may seem like a trivial thing, but in Indonesia there's a so-called minority and majority, an opposition. But it's hard for us to understand in this highly polarized world of Washington that there are no big issues separating the parties in Indonesia. There is only one economic policy and that's state-centered, large role for SOE, tight controls in the private sector. All parties agree to this. There are individuals in the parties who don't, but all parties agree to this. There is no economic issue. So the only reason they're there in parliament is to get their share. The only way to get your share is to be on the train. If you're not on the train and the train leaves the station, what's the point of being here? This is why the coalition is so weak. This is why, in spite of the notional minority position, he was able to pass a difficult budget and a very controversial bill on direct elections with no serious opposition. This is why all the major parties have split, all the major parties in the anti-government coalition have split because half the party says, wait a minute, we don't want to be in the opposite. We want to be with the president. So my own view is he's playing those cards very well. I think we'll have a significant cabinet shift in the second half of the year, probably towards October. And we will see a Jacqui movie from strength to strength on the political side. This brings us basically to the economy. I'm gonna skip through some of these political slides here if I can just figure out how this works. Oh, there we go. Okay, let's just go to the economy. Now, during this whole thing, Jacqui's remained cool and generally unflustered. And his biggest problem is his own party, the PDIP. And we can talk about that in discussion period. But I want to spend a few minutes on the economy. Now, there really have been two very important changes in democratic Indonesia. And one very positive in my view, the other very negative. The positive change has been decentralization. And if you follow Indonesia carefully, you know it's controversial because of very low quality of human resources in many of the regional governments. And so there is certainly an issue of competency. Reflecting on the central government, somehow the issue seems to come more into balance. But the real change in decentralization has been, my view, Indonesia has accomplished one of the greatest income redistribution programs of any major country. And it gets no headlines and people almost aren't aware that it happened. What happened? Well, Indonesia is a highly centralized country. All tax revenue comes into the central government. All tax rates are set by the central government. Local government collects very little money that it keeps directly and can set no tax rates. Not a real estate rate, not a local sales tax, not a local, it can't do any of that. All comes in and historically has been redistributed by the central government budget and crony capitalism. And this is why over the history of independent Indonesia, Jakarta became so dominant and the other cities became so relatively small. So think about, if you think about Jakarta, you know Jakarta, you have to ask yourself why Balikpapan doesn't look like Houston. You have to ask yourself why Manado, why Medan doesn't look like Los Angeles. Why Surabaya doesn't look like Boston. Why they're so physically below Jakarta in terms of infrastructure, education, all sorts of things. And the reason is quite simple because all money came into Jakarta and very little went back out. So one of the graphs I like the best is since decentralization was passed and implemented in 2000, year 2000, prior to the year 2000, and as far back as you wanted to go with your graph, you would find bank credits, two thirds in Jakarta, sometimes more, and one third of the rest of the country. 5% of the population, two thirds of the bank credits in terms of deposits, the picture is almost the same, two thirds. Going back to bank credits, almost immediately when decentralization was implemented and 30% of the budget was sent out to the regions, the money shifted. Now it's two thirds, one third outside of Jakarta. Jakarta still is the big city, but two thirds outside and deposits are now 50-50. And one thing we know about political power is political power always follows the money. And the money is leaving Jakarta. And that is the resistance to Jakarta. We're now getting regional leaders like governors in the United States who often make their names running big and small states and then come to national prominence and ultimately some become president. This is what's happening in Indonesia. It's happening sooner than I expected. I didn't expect someone for another five to 10 years, but Jakarta captured this phenomenon. It's hard to explain how much of an outsider he is. I guarantee you when he was mayor or solo or when he was governor, even maybe he was governor of Jakarta. I knew more people in Jakarta than he did of the people who mad it. He really was an outsider. He didn't know anybody. It's like me going to New York and saying, you know Donald Trump? Oh, that's Donald Trump. You know Donald Trump? He didn't know anybody. And so this is how radical it is. And this is why if you follow Indonesian politics, I personally was surprised. A lot of people in the last days of the election gravitated to Prabowo, who I thought knowing them, their policies and worldview was closer to Jakois. And the simple reason was, is he's not one of us. I don't know him. He doesn't know me. I know Prabowo, Prabowo knows me. Things will be better. And this has been a real challenge. This is how different Jakoi is. And it's reverberating through the system. You see it in the cabinet appointment. So this is a very, very good thing for the economy. The other thing on the economy is, of course, a few of the negative items. Isolationism, protectionism, deficits, and resource trap. And basically over the last decade, Indonesia, I think the best way to characterize it is slowly, but consistently, narrowed the space for the private sector. They've turned increasingly to state-owned enterprises. They've turned increasingly away from transparency on policy and expenditure. And they rely more on SOEs. They have, in a way, felt, I believe, that international norms force them to do things that are infringement on their national sovereignty and dignity. They really feel that they should be able to intervene in contracts at any point, that they feel it's better for Indonesia, as they define it. And they are really uncomfortable with international rules and regulations. And this is why in the later SBY years, this may sound trivial to other people, but they decided they would not renew any bilateral investment treaties. And these just set rules of behavior for international investors. And they felt that they never benefit Indonesia. They didn't see how it facilitated the flow of money into Indonesia. They just saw it as making us do something we might not want to do. The same thing is true when they talk of public-private partnerships. Bottom line is they find it too slow and cumbersome because they have to have too many contracts, too much transparency, and follow too many rules. So if they just turn it over to a state or enterprise, then everybody understands the game, the rules, the state banks will come in with the money, and if there's a problem later on, we'll all sit down and talk about it no matter what the contract says. So these are difficulties in the previous decade rule of law, transparency, and desire to be integrated into a global, economic, and legal framework really went in the opposite direction, very inward looking. And you have to really start thinking Argentina when you think of the policies. Another way to look at it is if you follow Indonesian history, Indonesia was founded on basically Fabian socialist principles, much like many of the newly independent countries after World War II. India is pretty much the same principles of the time. And whatever you think about it, that was one of the leading intellectual trends in economics at that time. Then Indonesia participated, Indonesia's economic thinkers were of international standard. Then Suharto came along. Basically it would sit down, shut up, and do it my way. And his way turned out to be pretty good for the economy. And he did integrate a lot of liberal principles. But it was like the sin that dare not speak its name. You could do it, you just couldn't call it liberal economic principles. And what happened when Suharto fell? It seemed to me like these old PDIP types instead of in 1998, 2000. As I was saying, when Suharto interrupted me in 1967, and then you go back, they had the museum view of economic development. But there had been no dialogue. Suharto had created no constituency for the liberal reforms that he instituted. And I once had a very interesting talk with Professor Sodley, Mohamed Sodley, and many of you will remember one of the leading Berkeley Mafia economic technocrats. And we had this discussion and I said, you know, from my view, I really like what you're doing, but you're not selling it to the people. They don't understand the reasons why. And his answer was very illuminating of the times. He said, Jim, we have one client, Suharto. If he likes what we're saying, he'll do it. But if he thinks we're going out to build our own base, we're finished. So we cannot have any kind of public debate on these things. The consequence was that the quality of public debate on the economy in Indonesia has deteriorated dramatically. His consensus has reformed. It's a very emotional consensus. It's a very romantic consensus. And it has failed in every country that's tried it seriously. So there's every reason to expect it will fail in Indonesia. It's just a question of how much dynamism there is in the domestic economy, how much dynamism there is in the emerging middle class to overcome the weight of isolation from international supply chains and so on and so forth. Certainly, it will limit growth. To my view, with current economic policy, there's very little chance of attaining 7% growth any time in the next 20 years unless commodity prices go up without a change in direction, without a greater role for the private sector. So this will be something we will see. What's the difference between the Jacoa government and the previous government? My own view is they will be more practical. And we're already seeing that in discussions over the first few months. In other words, their problem solvers without much ideology. They would be surprised to hear me say they have an ideology. They don't think they do. But I'm distilling it from the actions of the previous government and the laws and regulations that they passed. It's the only conclusion I can draw from the actions they take rather than the words they say. But they're willing to work it out. So now one of the big train wrecks in the late SBY era was the ban on the export of unprocessed minerals. Okay, you can argue that many directions. But the government passed the law and said you guys figure it out and then they waited until the day before the law was coming in place to try and work out a practical solution. Under Jacqui, he says it's a law. He supports the law, fine. But he's already working closely with the mining companies to make sure that you don't have to have a smelter in 2017. Because if you haven't started the day, you're not gonna have one. We all know that. So let's not pretend that you have to have one in 2017. But you have to have one. Let's work out a plan over time where you can do one which still allows you to stay in business, make some money, pay some taxes, allows us to collect some royalties. We won't have six months where there are no exports and everybody loses. So basically what we're gonna have is a more practical, probably more transparent and certainly more honest implementation of bad rules. But the rules are still bad in terms of robust investment in economic growth. Now you can argue environmental concerns and there's a whole other aspect of this. But the bottom line is this is just one example which is reflected from sector to sector to sector to sector to sector. There are more limits on foreign ownership. In some areas you're allowed maximum 60% foreign ownership. In some areas 70% and some areas 30% sounds okay, but then you think about it. Why 70, not 60? Why 60, not 64? What's the math? What's the public benefit? What's the benefit of Indonesia to these rules? No analysis, no strategy, no methodology, all emotion. This basically we want a piece of everything any foreign investor has. Well what about the 30% tax they pay? No we want more than that, that's not enough. Oh, okay. And part of this is a general suspicion of the private sector, not just the foreign private sector but the private sector in general. Because the ideology of the bureaucratic elite is still the 1950s, the state must do it. This made sense when you're a newly independent country with very little in the way of resources, very little in the way of capital and the state was the only institution with capital because the rest was owned by the colonial powers, came over to the state, the state had it. You can see the logic. Now in the 21st century it seems like a dead hand and a dead end. And basically they have import substitution policy again which has failed in pretty much every country that's tried it. So I'm very worried obviously about the economic future. The dynamism I see is from decentralization. I'll skip through this because I know you have questions and I've been talking too long. The dynamism is in decentralization, political stability and conservative fiscal management. I'm not okay about that. So what we've seen in the last several years, I thought this slide, you should see Indonesian growth peaked at 6.8% in 2010, second quarter. It's been in a pretty steady but slow steady climb, only in about one, two, three, four quarters. Five did it increase. So what we're hoping is the 5% growth at the end of last year is a trough and it will get about 5.2% this year and build up slowly to 5.5, 6% basically on infrastructure investment. But you can see that over the last several years GDP per capita actually declined. This is a tragedy in a country like Indonesia. I know 5% growth sounds wonderful. Many countries, I mean it would be the envy but it's just not enough. It just won't get Indonesia where it needs to go. There are 11% of the population living on less than a dollar a day and there are about 50% of the population living on less than two dollars a day. So you're talking close to 100 million people plus living on two dollars a day. So this kind of growth and which is, I think 21st century growth is more weighted towards the urban class than the rural class. So you can see that gap in terms of equity, in terms of distribution is going to be a problem. So this is really a difficulty for Indonesia. Now there are some good signs on the economic side. This is a study from JVIC, the Japanese Bank for International Cooperation. It's a global study. They rate the whole world as an investment site for Japanese countries. Indonesia has moved up from number ninth about 10 years ago, eight years ago to now number one and is very, Japanese investment has really recovered very well over the last four or five years. And the reasons they come there are growth of potential local market, an expensive source of labor, current size of the local market, good supply base for assemblers and industrial cluster development. Some of the negative reasons are the same. These would be the same for any company, any American company or other multinational. Rising labor cost, underdeveloped infrastructure, unclear laws, inconsistent implementation, intense competition with other companies and difficult to secure management level staff. Now in all of this Indonesia has actually made it harder rather than easier to bring in expatriates. So at a time of human resource shortages, it's very hard to bring in expatriate technical support, which really affects a lot of projects, a lot of investment. In one case, a major investor was being pressured to export from Indonesia. So they decided to set up an export base in Surabaya and they had a multi-billion dollar investment plan and it was gonna be a logistics and global distribution center. And they were denied work permits for their expatriate technical people. So one hand not knowing what the other hand is doing or something like that. But it's become generally the default position. A few months ago, the minister of manpower decided that foreign workers would have to pass an Indonesian language competency exam before they could work in Indonesia. So before you come to Indonesia, you probably take a one-year intensive course and then pass the exam. Now how does that make you globally competitive? How does that fit with employers' requirements for a foreign technical? No study, no nothing, it came out of the department. Now we just hear from the vice president, Yusuf Kala, that that's going to be rolled back. But he says it takes discussion. Now it's interesting, it didn't take any discussion to pass it, it didn't even go to cabinet. But it takes discussion to roll it back. My suggestion would be take the guy who wrote the regulation, tell him to write another one and then fire him. That would be my solution. That would help with cabinet, I suppose. But somehow that's a bridge too far. But it's just the climate of opinion of someone who's been there as long as I haven't been treated so well by Indonesia. I mean, it's a wonderful place, wonderful place to be. And so it really saddens me to see this attitude take over the official, the officialdom. And it's really, to my view, just again, limiting the potential for Indonesian growth. Certainly pretty much assuring another decade that Indonesia will miss the global supply chain. And my own observation is, if you don't get in the global supply chain in the next decade or two, you won't get in. Because most manufacturing is moving away from developing countries, back to developed countries because of computer-driven manufacturing and assembly, you're no longer going to be able to get into the industrial era by working in garments and textiles. They're going to be made close to the market, not far from the market. That's a change I think is coming. So I think large developing countries who don't develop their manufacturing base over the next 10 or 15 years will probably not have one. And I'm afraid that's where Indonesia is headed. Now, it doesn't mean they can't do a lot in the service side because Indonesia IT is moving up and other services are good. But I'm very pessimistic about Indonesia's ability to integrate itself into the global supply chain because the same opportunities also create a vulnerability because once you're in the global supply chain, you are vulnerable to what happens in other places. Marks up here, down there, nothing you can do about it. You're stuck with it. But that's the global supply chain. That's an inevitable vulnerability in a global economy. And the only way you can do that is by trying to have as robust an economy as possible. So I believe that the strategy they have adopted is a strategy that can't succeed. And I say this because nobody else is saying, which either means I'm crazy, of course possibility, but it also means I think I would really encourage a more active dialogue in Indonesia. I know there are some groups that are now worried about the isolation but the thing that has shocked me over the last five or six years is the lack of pushback in this direction. The general feeling that it's the right thing to do. And so I think when I give talks to groups like this, when I give talks in Indonesia, I just say what I say to you and I'm very concerned about the economic future of Indonesia. In that context, if you have political stability, if you have conservative fiscal management and increasingly you have more social justice, social justice is through decentralization and direct local elections, you will have a reasonable platform for growth. So I think over time things will change as particularly as local governments gain more competence and more influence. This is really the thing to watch. This is why this battle over direct local elections was really a savage clawback by the Jakarta elite to try and regain the power that's been slipping out of their hands for the last decade. They know it, they see it and they want it back and it was defeated and Jakoi defeated it. And this is why I say he can be a transformational leader. I think he can change Indonesia even with the economic difficulties that I described. And then I think we will see more practical government, more practical governance, more practical regulation and policy environment and then if the economy doesn't suffer a severe setback, I think Jakoi will easily be reelected in 2019. Over this period we can see Indonesia regain a higher growth course. But it's not gonna be easy. It's gonna take a lot of patience and it's also going to take a lot of patience as he compromises with unsavory elements because if you were to weight it at this political scene, unsavory elements, 70 pounds, savory elements, 30 pounds. So the 30 pounder cannot beat the 70 pounder. Therefore the police KPK battle if we wanna go into that we can, that was just one he did the best he could but he lost. And he's paying a political price among his base. There was just, I was just reading in the paper there was a demonstration at a Sumatran University the other day. Democracy is dead in Indonesia. Reform is dead, Jakoi's let us down. Well, he compromised. He had to compromise. When you're 30 and they're 70, you're gonna have to compromise a lot. But I think he's making gains and I think he will continue to gain. And if I'm correct that he can consolidate his political power, I think ultimately we will see him become a very strong leader and very transformative and move Indonesia in a much better direction. So I'll stop there and over to you. Fantastic, thank you very much. Well, that was a really nice coverage of the waterfront and all the issues and clearly by someone who is deep in the details of Indonesia you live it every day. Now, I would love to debate you on many of the issues you raise but I'm going to stop that. I'm going to try and not, I'm trying to resist that temptation but I will ask you questions about areas which you haven't spoken about or perhaps ask you to elucidate on them. You haven't spoken about the fact that to a lot of people's surprise, Jakoi's opposition, large part of his opposition has come from within his own party and from his own mentor and also in part also from his own vice president. Right? And on the other hand, the opposition that we thought would be very powerful has turned out to be much less powerful than we anticipated, less unified and there is now a split in Golkar. It's not clear which way Golkar is going to go but there is even a possibility that groups that we thought were in the opposition might actually come over and become coalition members with the PDIP or at least with Jakoi. So when you talk about Jakoi establishing and consolidating his political strength going forward, can you paint for us a picture of how that is likely to evolve given these fluid dynamics or factions within political parties and how they will play out over the next couple of years? Okay, there's several components of that. The easiest one to answer is the other parties. And it's really simply as I said before there's no ideology separating them. They just, you're either in or you're out and no one spent all that money to get elected to be out. They spent elected to be in, they spent the money to be in. They wanna be in, that's what every party split is about. Why are we in the opposition? Well, we are because we are, well, why? And that's 3P, that's Pan, that's Golkar. And my own view is that even if Bakri were to win the Golkar battle, he'll still join the coalition. There's no reason to be out and that'd probably be one of the conditions of him winning. But, so that part is, again, it's really stunning how unideological the politics are and even the so-called Islamic parties versus the secular parties is. You know, they really have just evolved into patronage machines for their own groups and very little ideology. So that's how I answer that part of the question. And so, but not to say it's easy to bring them on board because Jacoé won't bribe them. In other words, he won't let them, you know, you get this project and steal whatever you want, I won't look. Which is basically the old model. And so, but he will give them access to projects. He will put their people on the boards to say their enterprises. He will make some ministers. He will make, well, that's what he's got to give. That's politics, that's package. You got to give something. You appoint people, you know, who will support you politically. So that's how he'll deal with that. Pretty normal political thing. I don't see too many obstacles. I don't see the only threat is to control the corruption that that can easily generate. Harder part, more interesting part is, of course, his own part. This is, and you have to, you have to, this is so marvelous. So marvelous in Indonesian, I guess. The parties, with the exception of Goldcar, are totally the creatures of the person who created them. Whether it's Megawati, or Ameen Rai, or Wahead, or whoever it was. And so they're very personal, they're very top-down. And the whole structure is designed to support party leadership and weaken the role of the individual party member, even the individual party representative. In other words, Indonesia doesn't have single-member districts. Each district has four or five members, or more, 10. So there's no accountability. Once you get elected to parliament, the only person who's important to you is the party leader. People who voted for you are not important because in the next election, you could be moved to another district. It doesn't matter. You might not even get on the list if the party boss doesn't like you. So the only person who matters is the party boss, the party leadership, i.e. Megawati. So Megawati was persuaded to support Yokoi in solo, because they didn't have a candidate. So she did. He won. Turned out to be very popular. So Prabowo, bless his cotton socks, had the brainwave to bring Yokoi to Jakarta. Megawati says, what? Are you out of your mind? What? And no, no, it's good. He's a good guy. He can do it. Yeah, we don't have anybody else, right? Oh, okay. So he did. Now Prabowo, now I was wondering what he was thinking. But he brought Prabowo, persuaded Megawati to make Yokoi a candidate for Jakarta. And he was a heavy underdog. And he won. Wow. And then people right away, he became a national figure. And then Prabowo started thinking, what have I done? And Megawati started thinking, well, who is this guy anyway, you know? And I'm Megawati's. And so she's the party leader. So finally, grudgingly, she agrees to hit. She's thinking of running again, but she does read the polls. So the polls show that she had no chance against Prabowo. So she finally gives in and lets, and very late, nominates Jakoi. So late that they lost a lot of momentum and it hurt him in the election. But she nominates him, he wins again. So at every point, she's getting a little weaker and a little more nervous. And the interesting thing about Indonesian politics, well, we fully expect our president to be a Democrat, to be partisan. As a Democrat as a Republican, you expect him to be partisan. Indonesians don't. Sukarno, Suharto, and all the others said, the whole idiot says, I'm president of all the people. Suharto never joined a party. He said, I'm president of, he was never a member of Golgar. Said, I'm president of all the people. And Indonesians want that. They hear that and they, so they don't care. And that's why SBY can get 60% of the vote, but his party can only get 30%. That's why PDIP can only get 19%, Jakoi can get 53%. Because the party doesn't matter. At the presidential level is the person. So Indonesians now see him as president of all the people and every action that Megawati takes to thwart him makes her look smaller. And I believe costs her support in her own party. So they're gonna have a party congress next month. Megawati is the only candidate for chairperson. And she will probably win. The real thing to watch, she will win. The real thing to watch is the tone of the debate. There are people around Megawati who say that Jakoi should be impeached. They say that he should reinstate this old police chief nominee that they had. And if they carry the day, it'll be a very nasty, bitter and embarrassing conference for all. If, convention for all. If they are quiet and don't put too much dirty laundry out in public, it will show Jakoi's slowly, sooner than one would expect, is slowly gaining control of the party. By 2019 when the next election will be held, he will either have full control of PDIP or he'll be another party. And Indonesians won't care. So really, it's just really a question of how, if Megawati, Mega can take a dignified or undignified exit. It's really up to her. And this is a very Javanese duet. Jakoi is doing everything he can to avoid an open confrontation with Megawati and doing as much as he pleases. So he won't, he doesn't want to challenge her directly. If we remember how Suharto treated her father, Suharno, it was 18 months before he really confronted him directly. It was all very indirectly showing respect, showing respect that had finally isolated him. Very different times. I mean, Suharto was armed and dangerous. This is a democratic government. But the ballet is the same. It's a very Javanese. And in Java, open confrontation is bad. Backstabbing's okay because it's not in public. That's the way you do it. Where in America, if you backstab somebody, you're a bad guy, if you punch him in the mouth, well, you might not be nice, but he shouldn't have said that. So it's really just a different way of confrontation. And so it's really interesting to watch, but all the power is on Jakoi's side. He's got the government. He's got the budget. And so he's gonna win. So the real question is if Megha can just take a deep breath, step back, become what she has a right to be, the grand old lady of Indonesian democracy, and be dignified about it. But she couldn't be dignified of SBY and she's not, apparently, she's having difficulties with Jakoi. So now can I switch to a slightly different set of questions? One can't help making a comparison between India and Indonesia. Both have had elections, both have had now leaders, Modi in India and Jakobi in Indonesia, who have come out not from the establishment, from the establishment, but from the states or from the local government. But there is quite a difference, really, between the two leaders in some respects. One of the things that Modi has done in India is he seems to have encapsulated a strategy in very few words. This make in India has become a strategy. It's a very clear, clarion call for a lot of things, whether it's infrastructure, trade policy, regulatory policy, whatever it is, the objective is, quote unquote, to make in India. So it's galvanized government towards one single objective. Jakobi hasn't come up with something similar, except his maritime access vision, which really hasn't been explained to any great extent. What does it mean? And do you think it has the same kind of appeal, I say the make in India slogan has in India? And what is behind it? What exactly does he have in mind and why does he think it to be so important? Well, as I understand it, I mean the logic to it of course is to redistribute development around Indonesia by creating a maritime infrastructure, which is basically modern ports that key points around the country to facilitate trade. And we all know that the cost of domestic distribution in Indonesia is very high. It costs more to send goods 100 kilometers in Indonesia than it does in Europe or United States. Maybe two or three times more. So it's very expensive. So all of these things to integrate the country, help redistribute obviously growth would be a good thing. That's basically at the core of it. It's also to take control of its own seeds. And this is why he's made such a big thing of the illegal fishing. And I think this is a natural for him. There's also of course the security element, the people trafficking element and so on and so forth. So I think that, but it's not a buzzword that gets Indonesians excited. Although they do love to see those boats. They really, that gets a front page every time. And honest to goodness I was, I didn't even know he was doing it. The first day he did it, it was a Saturday or Friday night. I went to a party Saturday night at somebody's house and a couple of very senior Indonesians who I thought were pretty apolitical just came in. Man, did you see that picture in newspaper? Man, just blew that thing right out of the water. You know, I loved it. They just loved it. And so it was kind of reasserting sovereignty, which gets to this other thing that I was talking about early, but Indonesia is very sensitive that they are punching below their weight, that their sovereignty is not respected and all these international things, people are getting pushing them around. That's another reason for the defensiveness on the economic side. So this is his response to that. But it's very inward focused, Indonesia focused. He doesn't have a buzzword that really gets people's hearts beating faster, other than Bluskan, which is, of course, his lightning visits to a place where everybody comes in. And that is just, that's just magic. And if you've ever seen one of those, seen a film of one of those, I mean they really are impressive and genuine. And you can really see he's in his element with that. That's his own, so if he has a word, it's Bluskan. And that takes care of everything else so far. But that'll work then, if other things don't get delivered. But you're right, there's no broad, strategic economic policies, much more a tactician solving problems than he is with these issues. All right, so now let's open it up to all of you. Please, if you wanna ask a question and make a comment, raise your hand and then wait for the mic, because this is being recorded. And please identify yourself and your institution and then proceed with the question. Who would like to start? Yes, Mary. Thank you. My name is Ruth Dersh, I'm working with McCarty Associates with the Ambassador Keith. A question for you about the change, well, maybe not a change, but with the situation with the death penalty that has been delayed, what if you were to provide any perspective on that? Do we foresee that Jokowi will end up reversing this death penalty? Or why the delays and maybe a little bit on who is advising Jokowi in helping him make these decisions? I think there's a good chance he'll reverse it. Who's advising him? The answer initially is nobody. I think he was surprised it was controversial. And then offended that other countries would have that kind of a view. Which we in the US with our 32 states that still have the death penalty. There's not much we can say or should say. So I think again, this was a sense infringing on Indonesia's right to enforce its own laws. So I think that's a resistance factor to not executing the people. But every day this delay that I think makes it more like they'll find out that they won't do the executions. But I wouldn't be at all sure of that because they do consider that to be the proper execution of a duly convicted criminal. Yes, sir. Jerry Hyman at the Summit for Strategic and International Studies. I wonder if I could put a couple pieces of your talk together and ask your question about them. So the first thing you suggested is that Jokowi may become a transformational figure. Second is that he's very practical. So I guess two questions from that. First, will he reverse as a practical matter when he sees the effects on the economy, will he reverse all of this national, economic nationalism, state-owned enterprises, et cetera, because it's not, we'll see that it's not working. Second, as to the transformational dimension of that, is the transformational part the decentralization only? Or can you see him taking on what I thought was the implication of your discussion on economic thought in Indonesia? Namely that he would try to explain the importance of the market economy and truly make a huge cultural difference in how Indonesians think about the economy so that they move away from the sort of state-owned enterprises and protectionism, et cetera. Do you see that as a potential transformational convention? Yeah. So two questions, really. It's hard to say, but let's see. I don't know if he connects the dots in the same way. He'll make a practical solution, but he also is very inward-looking and he's a small-town businessman. Now, so by that I say he's practical. The interesting thing, for a populist, you see, usually populists, my limited, I'm really gonna put my foot in here, but anyway, they come, they're either intellectuals without much practical experience or they come out of labor movements where they have a lot of practical experience and take a certain view, i.e. in Brazil today. He's a small businessman and yet he's a populist, so it's more, he's almost a tea party guy in a different way. So he just wants things to work. I think he's gonna find out his romance with big government and SOEs might be a problem, but I don't think he's anywhere near that yet. And one of the things that concerned me is that when he went, when he's in China, the story that came back to Indonesia, he was talking to either the Premier or the Prime Minister or the President and he said, aren't you worried about all this foreign investment? And he said, oh, why? They can't take it with them. It's all invested here, we've got it, it can't go elsewhere. And he was really enamored by the role of the state in Chinese development. And my answer to that is, yeah, you did that 30 years ago, it was so hard to, it was appropriate then. And it was appropriate for China up to a point that you're beyond that now and you're beyond that in a democratic environment where the role of state has to evolve. But he's very enamored of the role of state. So I think it's gonna be a long time before that changes. So I really don't see an aha moment where they say, this is where we've gone wrong. It's just too much governance, too much government involvement. It's not gonna be that kind of thing. I think it's gonna be case by case and step by step. And I think there can be enough dynamism in the economy and enough success that there will be growth in this model. But I think I'll be really looking for the first big public-private partnership in infrastructure to see if they can really pull it off. Because simple fact is, there's not enough money in Indonesia to do all they need to do. It has to come from abroad. And the state can't borrow it all. It has to come from investors. The state can invest about $30 billion a year in infrastructure to rotate. They could easily invest, double that amount without doing stupid things. So where is that money gonna come from? It's only gonna come from outside Indonesia. It's only gonna come from the private sector. And if it doesn't come, then it will be very hard for Indonesia to catch up. Because the countries that are ahead of Indonesia infrastructure and so on are also investing fast. So it's a moving target. So we'll see how that goes. But one of the things I'll be watching is if they can mobilize more private money for infrastructure, if they can't, then the pace is inevitably slower. If I answered your question. One point to emphasize also, I think, is, you're right, finance is important and it's critical. But one of the big mining constraints of infrastructure development are all the regulatory land acquisition issues, the fact that there isn't implementation capacity within Indonesia ministries. And these are major constraints. So even if the finance were available, it's not obvious to me that we will have accelerated infrastructure development in the country. Well, again, that's why in an ideal world, you could turn it over to a private consortium that could bring this. All you have to do is make the contracts. Now that's gross over simplification. But they don't have the implementation capacity. But they should be able to develop a template. I mean, power plants have been built everywhere in the world. It shouldn't be hard. But somehow it is hard. Why is it hard? Get the template and get out of the way. Yes, sir. Right up in front. Oh, that got the hands up. Yep, fantastic. Whoa, you've got some momentum here. Mikey Anderson, retired foreign service officer. You mentioned that Jakawi will be visiting the US in the next two or three months. What would you anticipate to be on the agenda? And do you think he will endorse the US-Indonesia Comprehensive Partnership that SBY and Obama both endorsed and seem to have kind of run out of steam? That's, I hadn't thought about that. And I hope he does. I think it's going well. Yeah, I haven't heard that mentioned in discussions. I think there, I think- What were they talking about? I think maritime security, so many issues there, whether it's environment, whether it's obviously the obvious security side of things, the mill to mill. I think they're going to be talking about trade issues. You know, we just filed a WTO complaint against Indonesia that will probably come up, I suppose. There are a few things, but I think part of the problem is to get a robust agenda. And a lot of it, I think, and I think that I don't say this is a good thing, Jakawi's a new leader of a major country, and I think he's coming, he should come to introduce himself to Indonesia and try and put some more energy in the relationship. My own view is that the US has pivoted away from Southeast Asia to the extent it's still interested in Asia at all. It's North Asia, and it's really the only thing it has going is TPP, which Indonesia's not interested in at this point. And the US is not involved in the Asia Infrastructure Investment Bank, which is going well, and we've kind of, I think, lost a step on that one. So I think my own persons, I don't have high hopes for practical outcome for this. I think it's very important symbolically, I think, for Jakawi to register present. And I think it's got everybody thinking about it. And I hope, please don't put this in the press anymore. I think both sides should reflect on the very limited number of important things they have to talk about. I think both sides have let the ball drop over the last four or five years in that area. And I hope this would get both sides thinking a little harder about how this important relationship can be given, we can put more value through it to both benefit of both countries. Yeah, but in this particular case, I would also say that perhaps symbolism is even greater than substance. After all, it is Indonesia. It's the third largest democracy in the world. It's the largest Muslim country in the world. I mean, it's a moderate force within Southeast Asia and Asia. So I think there's a lot to be gained by having a visit from Jakawi, even though there aren't nitty gritty substantive outcomes, but establishing basic principles, areas of mutual interest, that sort of stuff. Yeah, I mean, and raising Indonesia's profile in the U.S. is an a priori a good thing. And there's so many good stories to be told in a world that's short of good stories these days. So yeah, if we can do that. Obviously, people want more concrete and more immediate benefits. And there's a lot of work on both sides. There will be some business deals announced, I believe. And there'll be some more practical things, but I'm more in your camp on that one. I'm glad it's happening. And I hope both sides can control their expectations to be to just say this is a first date rather than the marriage kind of thing. Bijoy. Thanks. Bijoy Dasgupta with the Institute of Ignatial Finance here in Washington, D.C. You know, I just wanted to come back to the state enterprise reform story. And you know, here you have a new minister, Rini, who's close to Megawati and with some private sector background and background having successfully run a corporation. Now, I understand that she is leading a team within the ministry and she's brought in people and the focus is on SOE reform. Now, do you have any views on this? I mean, is it real? Is it going to go somewhere? And how do you see it developing over the next six months or so? Yeah, I think it's real. And I think, obviously, it's a very good thing to try and improve the quality of governance of any institution or whatever. But I think the only way you can do that in a durable way with SOEs is to list them as public companies and force them to be more transparent. And reform short of that, the political weight against you is just too heavy. And that's not just Indian, that's anywhere. The UK found out and everybody finds that out. I mean, this is the political fiefdoms that standard enterprises become are just too heavy. Look at Brazil, look at the problems with Tetra Cross now. I mean, you know, that kind of thing. So the only, I mean, my view is obvious, selling. But the next, the first step to selling them is list them, make them have public accounts by independent auditors. Forced public accountants. Forced normal stock exchange standards. I mean, what defines a public company more than standard enterprise? What is more owned by the public than the standard enterprise? And yet they're treated with state secrets. You can't get the balance sheets of most Indonesian standard enterprises. So I'm all in favor of it. Transparency, reform, better governance and so on. But the odds are so stacked against you in the system. And we have, I think we have 140 SOEs. What, why, why? Some of them are real estate companies. Why do we have standard enterprise construction companies? We don't have enough good construction companies in Indonesia? Yes, please. Right here. Thank you. I'm Adin Horsh from SILES, I'm a second year. You just mentioned the big role of SOEs and the narrow role of the private sector and one way to finance more infrastructure development is through PPPs. And I'm also curious to hear how developed is the bond market and what role would play in financing more infrastructure development? That's a very good question. And another factor with infrastructure development in Indonesia is the domestic market is so small that can't finance a lot in Rupiah. And that's where you get into one of your real problems as you get the currency problem that you have, let's say it's a toll road with Rupiah revenue and dollar debt. Well, you're obviously taking the currency exposure and in 1997, 98 in the public private partnerships and the energy electricity business, Indonesia got murdered. They were paying seven cents a kilowatt hour, which is okay when the Rupiah was 2,000 to the dollar. When it's 14,000 to the dollar, it becomes a whole different thing. So Indonesia had to eat the currency risk and they ate it, they paid the higher Rupiah number without being able to immediately raise prices of that magnitude obviously. So that's your problem and the bond market is the issue and that gets to pension funds, that gets to domestic insurance funds. These are in any country a major source of long term money. These are the large investors in things like infrastructure and that's why it's so important we Indonesia do more to develop its domestic insurance industry, do more to develop its pension funds and so on and just the volume of money is not there. So even if you had a totally quote unquote domestic infrastructure project, they're gonna end up borrowing dollars from a state bank and they're gonna have a currency exposure against Rupiah revenue which creates a risk. Now it's all government, again you can lose that in the book somewhere but it's still a cost so much better to have it more transparent and develop mechanisms to deal with it but it's a real challenge. So developing a deeper, broader domestic bond market is absolutely critical for the long term future and that really requires a lot more serious thinking about the pension funds and the insurance industry in Indonesia. And just to supplement that, Indonesia's exchange rate is particularly volatile given the fact it has an open capital account and the fact that large amounts of domestic short-term liabilities are held by non-residents so money moves back and forth quite rapidly. Yes please, go back there. Thank you, Eric Black sends capital management. What do you think is the bear case for growth in Indonesia, assuming everything goes wrong externally? What is the Florida growth? And then with reforms like civil service reform, land acquisition reform, how substantial are these to maybe move the needle economically in the next five or 10 years? Of course the second question is, how substantial will civil service reform and land acquisition reforms actually move the needle on economic growth over the next five to 10 years? How important are they for growth prospects of the next decade? Well, land acquisition reform is essential to getting the infrastructure programs going because almost every project has significant delays related to land acquisition. So that's a major benefit if they do it. What's the downside? You know, some of you will remember the name Dora Jatun Kanchoyakti who was coordinating minister under Megawati, a very good economist among other things. He used to say, if the sun comes up in the morning, we'd grow it two to three percent. If the rains are good, we'd grow it three to four percent. That's because of the commodity agricultural base. Now that's a 20 year old view, but there's a lot of domestic strength in Indonesia. A lot of vibrancy and strength in the rural economy and the commodity economy. And if you wanna draw a distinction with India and Indonesia, and they're very similar in so many ways, that Indonesia has a stronger net export position in the commodities and the resources. And so whatever happens, price can maybe be high or low, but whatever happens, they're getting some foreign currency. So whatever happens. And that is very robust. Now, as a city boy in Jakarta, I see the Asian financial crisis as a terrible thing. If I was selling palm oil, if palm seeds out in North Sulawesi, time, life's are good. I used to get 2,000 rupiah for this. Now I get 10,000 rupiah for this. Man, life is good because a commodity is a dollar based. So I mean, where you stand depends on where you sit sometimes. So there's a lot of domestic strength in the economy. Another thing, my view, and I didn't, I could have said more about decentralization, but this money pouring out into these smaller secondary cities is hugely stimulative. And I think there's 1% on growth every year. I call it regional catch up. They're just paving a few more roads and building a few more schools out in all these cities and a few more office buildings. And I don't know what your view of malls and things are, but now all these secondary cities around Indonesia are having very modern malls, mixed use real estate, apartment, hotel, commercial building, mall. Every city has to have one. The airports in Medan, in Surabaya and in Sulawesi are better designed for capacity than Jakarta Airport. This is all new. This is all the last 10 years, all the last 10, 15 years. This is all happening. It's just gonna happen and happen and happen. And now from the budget, 40% of discretionary spending in the budget is now the decision to spend that is made in the region. It's not in Jakarta. That's hugely stimulative. So I think the downside to Indonesia barring political instability is really, I think 3.5% would be more than failure. I mean, it would just be awful. I can't see how we could do it. So I think you're talking about a 4% bottom, which a lot will be going on at 4%. Spending $30 billion in infrastructure is nowhere near enough, but it's $30 billion. So I think we're talking 3% to 4%, it would be, if it hit 4%, I think people would be in the streets to be honest. So we'll see. Come, Jackson. Wait for the mic. Thank you. Carl Jackson, Seiss. Jim, when you look at the long term of growth in Indonesia from 66 onwards, it always had names attached to it, like Wijoyo, Sadli, even Jatui. Also, various key economic leaders have been able to assert real power and fight back some of the forces that you've described. Someone like Sri Mulyani comes to mind also. Who are the people who are the equivalent of Sri Mulyani, or Wijoyo, or Sadli? Are there any in the wings, or are there not? In this cabinet, there are none, and that's by design. Jacoi doesn't want any stars, he wants workers. And a few people who thought they were gonna be in the cabinet in their interviews with Jacoi explained how great they were and how they could really help them out, and none of them got jobs. And the ones who said, what do you wanna do and how can I help you, got the jobs. And so by and large, you get a pretty interesting group of people that are quite unknown to the Jakarta elite. And so it's really different. It's hard to say how different it is, but it's very different. And I think it's caused some difficulties. As you mentioned, the big picture is lacking for sure. It's really kind of a problem-solving thing, and we'll have to watch to see who emerges from this group and who makes a name for themselves. I think there are people who could. There's some quiet people around him on foreign affairs like Rizal Sukma, some of us know. There's a very quiet guy, Jisman Sim and Jiltaak, on the economic side. Wijayanto Samin from Paramedina on the economic side, who's on Kala's team. There's some people, really solid people there who will see how they make their name. And of course, the big star is Luhut Panjaitan, who is kind of hollering and erupting rolled into one person. I mean, think about that for a few minutes if you're old enough to contemplate. You know, he's somebody who you have to take seriously, and that's of course what SBY didn't have. And so I think, and he's an older generation, some of the other guys that I mentioned are, you know, in their 50s, so they have a lot of time left to do things and develop their names still. For those of you who are 40, that makes them old, but to my age, I think it's pretty young, so I just have to cut it by then. So, but it really is, Carl, it's really different. It's a different place. And people are really rebuilding networks and creating networks at a frantic speed because it's all about networking in Jakarta as in so many places, so we'll see how it goes. But no stars have emerged yet. Characters, the ministry of fisheries, the lady is quite a character in her own right. And so she's made a lot of waves. First female minister with tattoos that we know of. So that kind of thing. But other than that, a couple of characters, but basically the whole story of when you meet with the cabinet people now, they're saying, this is what Jaco, what's the Jaco'i story? We're telling the Jaco'i story and this is what he wants done is what we're doing, which is quite refreshing after the previous government. So, we'll just have to see, but it could be, we're entering a very different territory and we'll have to wait. There is one name that you haven't mentioned who really has turned out to be pretty good. That's the governor of the central bank. Oh, August, he's, yeah. August has turned out to be quite remarkable because he's allowed the Rupiah to depreciate, but he's defended the depreciation, he's defended it on the right grounds. So, he's turning out to be a very influential force in the economic thinking of the... Yeah, definitely. I mean, the bank has an interesting role. He's technically not, you know, he was there, came before Jaco'i and he served independently for a five-year term, but definitely, and he and Jaco'i are very close. Of course, August badly wanted to be vice president and maybe the vice president in 2019, if cards break right. But yeah, he's a very high-quality... He's a clear thinker as well. Very high-quality, yeah. Yes, once I wait, be joined, get the microphone. But you need the microphone because... Just have Bang Bang do it because, you know, they were able to push through the full subsidiary forms and in a signal of 30 years to do it. I'm not sure. Well, well done. The finance minister. Yeah, Bang Bang do it. He's young, he's interesting and he may grow into the role very, very well. But I would, I hope he does, but really the subsidy was Jaco'i's, Jaco'i said, you do the subsidy, you do the subsidy, you do the math. So he did the math and he's very good at doing the math. But the one who pushed it through was that was a totally political thing, which is okay. I'm not, not Bang Bang in any way. He's young, he's good and he's experienced. He was deputy minister in the previous government so he has more experience than most of the cabinet members including in dealing with parliament, which is very important. So he should be, he should be good but he's not a Srimoyani with Jojo type yet. He could be. And that'll really, one of the things that will really be the test for Jaco'i will he enable his people to do well and won't feel threatened if he can build up some people like that. That would be a real, really interesting thing to watch and I think he may well be because he seems, as I said earlier, very comfortable with himself and not threatened by, you know, by big names or anything. Jim, time passes quickly when you're having fun and we've come to the end of our 90 minutes and it's really been absolutely fantastic listening to you. Thank you very much for the outstanding presentation and thanks to all of you for asking such a terrific question and being such a terrific audience. So please join me in thanking them. Thank you.