Omnibus Law: What You Need to Know in 700 Words

The following article originally featured on The IAS Gazette. Read it in its original form here

Widespread protests have erupted across Indonesia after the People’s Representative Council passed the Omnibus Law, and some have turned violent. We highlight what the law is all about and why it is controversial.

By Kelly Ong and Yoke Clara Yansim / November 27, 2020

A number of students from the University Of Palangka Raya protested in front of the Regional People’s Representative Council building in Palangkaraya, Central Kalimantan, on March 12, 2020. The university students demanded for the government to cancel the passage of the Omnibus Bill. | Photo Credit: Antara Foto/Makna Zaezar

Indonesia’s new Job Creation Law, popularly (or unpopularly) known as the “Omnibus Law”, covers a range of issues in a single regulation — the first of its kind in the country. The statute amended more than 75 laws, which has sparked controversies.

First initiated by President Joko “Jokowi” Widodo in February, the Omnibus Law was aimed at creating jobs and attracting investments, essentially deregulating the economy in the face of increasing competition and global economic demands. The law was also deemed necessary as Indonesia is expected to record its first economic contraction since the 1997-98 Asian Financial Crisis. 

The final draft of the bill was passed into law by the People’s Representative Council on Oct 5, 2020, before the large-scale three-day wave of protests between Oct 6 and 8 across the nation.

The Good 

Several changes in the Omnibus Law are expected to positively impact foreign companies and investors looking to penetrate the Indonesian market, potentially creating more employment opportunities.

Bureaucratic Efficiency 

The law simplifies the business licensing types and process by combining or removing licences and introducing a risk-based business licensing system. Businesses will be categorised into low, medium and high-risk levels based on the hazard level of business activities. Furthermore, the business licensing process can now be completed through an Online Single Submission (OSS) system, streamlining the previously complex and often unclear processes of obtaining business permits and licences. 

This is a major change introduced by the law, making the process of setting up businesses in the country more straightforward for investors. 

Corporate Tax Regulations

The law will cut the corporate tax income from the current 25 per cent to 22 per cent in 2021, and to 20 per cent in 2023. Public-listed companies that have at least 40 per cent of their shares traded on the Indonesia Stock Exchange (IDX) are also eligible for an additional 3 per cent tax reduction. Predictably, the proposed tax reductions will make Indonesia more competitive in the region. 

The Bad 

The lack of transparency in the drafting process has sparked widespread repudiation from the public. Here, we highlight two of the most contentious revisions by the government. 

Labour Laws

The Omnibus Law seeks to abolish the provisions of the minimum wage. The minimum wage law in Indonesia has long been hailed as the “crown” after the 1999 reformasi period as it protects workers’ interests against violations of trade union freedoms. Although the law recommends that minimum wage still be regulated by provincial governments, the central government is no longer obliged to stipulate a national wage policy protecting labourers. 

The abolishment of Article 64, regarding outsourcing of business activities to other firms and workers, also raises a warranted concern. With contracts being unnecessary for outsourcing, workers in the informal economy — accounting for more than 60 per cent of the workforce — now face higher risks as they are no longer legally protected.  

Environmental Permits

The establishment of the environmental permit was a milestone in Indonesia’s efforts towards environmental regulation and combating climate change. Hence, the revocation of the environmental permit is seen as a step backwards since businesses are no longer subjected to environmental impact and management assessments. Without the compulsory procedural, substantive and evaluative mechanisms in place, people are now nervous of the potential environmental repercussions.


The Ugly

In its controversies, large-scale demonstrations against the Omnibus Law were held in 18 provinces across the country to call for a revocation of the law. Despite Jakarta being one of the major Covid-19 hotspots, people assembled to protest the new law, disregarding pandemic regulations.

The national strike organised by union leaders has been largely peaceful. However, some demonstrations have turned into violent scenes of protesters throwing rocks and setting fires. Meanwhile, riot police officers retaliated by firing tear gas and water cannons to disperse the crowds. Activists have accused the police of using excessive force against protesters and journalists, with hundreds of reported cases of alleged assault and missing people.

In response to the mass criticism, President Jokowi claimed that the hostility to the Omnibus Law has been based on “disinformation and hoaxes spread through social media”. On Nov 2, President Jokowi officially enacted the controversial law, and the constitutional court has received three requests from citizens to review the law. At present, the full implication of the law remains uncertain.

Have 75 Years of United Nations Made the World ‘Better’?

The following article originally featured on The IAS Gazette. Read it in its original form here

To commemorate the United Nations’ 75th anniversary since its founding, we examine how much the UN has changed the world for the better. Is it a tool for cooperation between nations, or is it one for control instead?

By Yoke Clara Yansim / October 24, 2020

Edited by: Robin Choo

“The world of 2020 is far different from that of 1945, and it’s different because it’s better. And it is so, to a large extent, thanks to the United Nations’ efforts during these three-quarters of a century to maintain international peace and security.” 

This was the message that President Luis Abinader of the Dominican Republic had pre-recorded for his address at the United Nations (UN) General Assembly last month, but not everyone shares this sentiment. 

From the Ashes of War

On New Year’s Day of 1942, at the height of the Second World War, the name “United Nations” was coined by the then United States President Franklin D. Roosevelt in the “Declaration by United Nations”. The document was then signed by representatives of 26 countries fighting the Rome-Berlin-Tokyo Axis, pledging the signatory governments to the maximum war effort and binding them against making a separate peace.

Representatives of 26 Allied nations met in Washington, DC to sign the “Declaration by United Nations”. This document contained the first official use of the term “United Nations”, which was suggested by United States President Franklin Delano Roosevelt (seated, second from left). | Photo Credit: United Nations Photo

It was against this backdrop that the UN was formed three years later. 

In June 1945, representatives of 50 countries met at the San Francisco Conference to draw up the UN Charter. As the global conflict concluded with the Japanese surrender, the Charter came into full force exactly 75 years ago, and so began the work of the UN. 

With the war still fresh in the collective memory, the UN Charter mandated that member states ensure “armed force shall not be used, save in the common interest”. Fifteen states constitute the most powerful organ of the UN: the Security Council.

Tasked with maintaining the peace and security of the world, the Security Council is the only UN entity permitted to deploy military force and empowered by the international community to impose sanctions. The Allied victors — United States, France, United Kingdom, China and Russia — became the five permanent members (P5) of the Council.

But more than just to prevent future conflicts, the UN Charter also sought to protect basic human rights, establish conditions for international law to be maintained, as well as promote social progress and better standards of living for all peoples.

The ‘United’ Nations

The UN is the liberal institutionalist solution to the question of how to encourage cooperation in a world where there is no authority superior to nation-states capable of providing order to the international system — a situation of international anarchy. 

In “The Promise of Institutionalist Theory”, Robert Keohane and Lisa Martin wrote: “But in a world politics constrained by state power and divergent interests, and unlikely to experience effective hierarchical governance, international institutions operating on the basis of reciprocity will be components of any lasting peace.”  

But how does the UN facilitate multilateralism in practice?

The answer: through the establishment of international norms and a rules-based system, as well as its wide acceptance by states. The UN General Assembly is a crucial instrument in this regard, as it provides a unique forum for multilateral discussion of international issues among all the 193 member states that the UN currently has. However, the Security Council remains the executive body holding the exclusive power to deal with issues of peace and security. 

When the UN was formed, the world was still reeling from the aftermath of the Hiroshima and Nagasaki nuclear blasts. The very first resolution of the UN General Assembly in January 1946 addressed the “problems raised by the discovery of atomic energy”. Collective security has thus always taken centre stage in the world agenda post-World War II. 

Javad Zarif (on screens), Minister for Foreign Affairs of the Islamic Republic of Iran, addresses the General Assembly high-level plenary meeting to commemorate and promote the International Day for the Total Elimination of Nuclear Weapons last month. | Photo Credit: United Nations Photo

Today, inter-state wars are rare, compared to the 20th century. The absolute number of war deaths globally has been declining since 1946. There is also evidence that the UN has been moderately successful in areas of civil conflict through its peacekeeping operations, such as in Namibia (1989-90), El Salvador (1991-95) and Cambodia (1991-93). 

Areas of cooperation between UN member states also expanded to tackle other global challenges beyond the traditional security issues. 

In economic development, for instance, the UN’s work has been guided by the Millennium Development Goals (MDGs) since 2000, with virtually all funds for UN development assistance coming from donations by member states. During the first UN Conference on the Human Environment in Stockholm, 1972, then Indian Prime Minister Indira Gandhi highlighted the connection between ecological management and poverty alleviation.

Nevertheless, the UN is far from perfect.

The Sustainable Development Goals (SDGs) — or the 17 UN objectives aimed at eliminating inequities by 2030 — are “seriously off track in many, many ways”, according to Barbara Adams, chairwoman of the Global Policy Forum. The SDGs, which officially came into effect in 2016, are an extension of the MDGs, with an added focus on inclusiveness and sustainability.

The UN’s weak enforcement procedures have also attracted much criticism. The problem of anarchy persists because there is no mechanism to empower the judgements of the International Court of Justice, the UN’s principal judicial organ. For instance, although an international tribunal in The Hague backed the Philippines in the South China Sea dispute in 2016, the tribunal could not directly enforce the ruling as China rejected the decision.

Observers view the lack of an international army, resulting from the reluctance of member states to create a common army, as a flaw. UN peacekeepers are first and foremost members of their national armies seconded to work under the command and control of the UN.

Children salute UN peacekeepers (MONUSCO) in Katanga Province, Democratic Republic of Congo. | Photo Credit: United Nations Photo

The UN’s main weakness, however, is its ineffectiveness in solving contemporary global challenges, such as transnational terrorism and illicit arms trade. As an international organisation that comprises and is a product of states, the UN inadequately acts against threats from non-state actors. Far from being united, the UN faces a collective action problem in tackling issues like climate change, explaining the failure of numerous climate change agreements.

An Instrument of Control?

With all its strengths and weaknesses, the reality is that the survival of the UN is dependent on the US’ leadership and power after the Second World War. After all, the US played a key role in establishing the UN.

The US is the largest donor to the UN by far, contributing US$679 million (S$922 million) or 22 per cent of the organisation’s regular budget in 2020. That fact, coupled with its seat on the Security Council and its immense economic and military prowess, all but guarantees its role as the UN’s most influential actor

At times, this influence has been used to advance its interests. 

Research by Better World Campaign showed that in 2018, American companies were awarded US$1.64 billion (S$2.24 billion) in contracts with the UN, by far the most of any country. The UN has also been essential to several top US foreign policy priorities. For example, Security Council sanctions on Iran have helped curb its nuclear ambitions over the years (although recent developments have put the US on the back foot). 

The structure of the Security Council itself is also worth discussing.

The composition of the Security Council still reflects the power distribution of 1945, with its P5 members holding more powers and prerogatives than the 10 non-permanent ones. Several ambitious middle powers, such as India, Brazil and South Africa, have expressed their dissatisfaction in its current structure, pushing for a comprehensive reform of the Council such that it is more inclusive and equitable. 

On the other hand, the way the Council is structured is also what sets the UN apart from its post-World War I predecessor, the League of Nations. The logic: granting veto powers to each of the P5 members will ensure the major powers’ active participation in the UN system of collective security, preventing large-scale conflicts as we have seen in the previous century. 

75 Years On

The United Nations Headquarters in New York City, USA. | Photo Credit: Reuters/Carlo Allegri

Is the world today really better than it was in 1945 because of the UN? 

That is entirely subjective. On some level, the UN has achieved what previous international institutions could not in keeping world peace. Still, it is unable to end protracted wars in Syria, Yemen or Libya, among other regional conflicts in the world. 

Seventy-five years after its founding, the UN is yet again preoccupied with the greatest global challenge since 1945: the Covid-19 pandemic. Along with it, the US and China’s increasingly tense (or as UN Secretary-General António Guterres calls it, “dysfunctional”) relationship, climate change, poverty, gender discrimination, justice and human rights remain the world’s biggest issues. 

At a time where collective action is desperately needed, the world is more fragmented than ever. States can clearly do more to enhance multilateral cooperation.

From Politics to Peace: How Dalai Lama Changed Her Life

The following article originally featured on The IAS Gazette. Read it in its original form here

Before Dawn Gifford Engle embarked on her peace projects, she was the youngest woman ever to be appointed Chief of Staff to a United States senator. However, she had no clue how her meeting with the Dalai Lama would unfold and change her life in unexpected ways.

By Yoke Clara Yansim / September 16, 2020

Edited by: Kelly Ong

Before Dawn Gifford Engle, 63, embarked on her peace projects, she was the youngest woman ever to be appointed Chief of Staff to a United States senator. However, she had no clue how her meeting with the Dalai Lama would unfold and change her life in unexpected ways. 

It all began when Ms Engle first met the Dalai Lama during the International Campaign for Tibet in Dharamsala, India thirty years ago to draft some of the first legislation for the defence of human rights in Tibet for the US Congress

Ms Dawn Engle in Tibet thirty years ago. | Photo Credit: PeaceJam Foundation

It was during their meeting that Ms Engle witnessed how the renown Tibetan political and spiritual leader did not carry different facades. It was unlike most of the politicians she had met and worked with before, who often possessed a public persona and a private one. In an interview with Tibet TV in August last year, she confessed: “Gradually, it got harder and harder to work for Congress with all the hypocrisy and lies. It was just harder and harder to do when you know that there is true integrity out there.”

Ms Engle then decided to take a leap of faith and tendered her resignation. Convinced by the bold idea that the most ordinary people have the capability to contribute to the achievement of world peace, she wanted to do something good for humanity instead. 

“I have to say that I believe in the people before I believe in our elected leaders. We have some really great elected leaders, but not a lot of them,” she told The IAS Gazette in a video interview from Spain in April this year.

The biggest challenge, she said, “is that we give away our power”.

“We think that the problems are so big, and I am just one little person. … If everyone on planet Earth just helps one other person, the whole world would be transformed, right?”

The Dalai Lama – Scientist

In February 1996, Ms Engle, together with her husband, Ivan Suvanjieff, co-founded the PeaceJam Foundation, an international organisation which aims to “create young leaders committed to positive change in themselves, their communities, and the world through the inspiration of Nobel Peace laureates who pass on the spirit, skills, and wisdom they embody”.

The 14th Dalai Lama (second from left), with Dawn Engle (second from right) and her husband, Ivan Suvanjieff (right). | Photo Credit: PeaceJam Foundation

His Holiness the 14th Dalai Lama, Tenzin Gyatso, was pivotal in the making of the organisation. 

As a strong advocate of peace, the work of the Dalai Lama, who had just celebrated his 85th birthday in July, is widely recognised. He was awarded the Nobel Peace Prize in 1989 for his non-violent approaches during his fight for the liberation of Tibet from China’s military occupation. The Norwegian Nobel Committee noted that he had “instead advocated peaceful solutions based upon tolerance and mutual respect to preserve the historical and cultural heritage of his people”. 

Ms Engle described the Dalai Lama as a very personable Peace Prize winner with “such a fantastic sense of humour”. 

When they approached him with the idea of having Nobel Peace Prize winners mentor the youth to change the world, he thought that it was a wonderful initiative. The Dalai Lama became the first Nobel Peace Prize winner to say yes to the project, urging other Nobel Peace laureates to do the same.

As the organisation grew and reached one million young people in 40 different countries around the world, Mr Suvanjieff, a former journalist, remarked: “This is history! (The Nobel Peace laureates) are historic figures! We need to film everything!”

With a closetful of footage they had accumulated over the years, he suggested that they use it to create the Nobel Legacy Film Series — a collection of films that capture the Nobel Peace laureates’ essence,  spirit and cutting-edge work for the world.

The series was helmed by the power couple, with Ms Engle as the director and Mr Suvanjieff as the executive producer. Meant to be both inspirational and educational, it strives to immortalise the incredible contributions that human beings have made, particularly in the promotion of peace. 

Film poster for The Dalai Lama – Scientist. | Photo Credit: PeaceJam Foundation

The Dalai Lama – Scientist is the sixth film in the series. It first premiered in August last year at the 76th Venice International Film Festival.

The documentary features extensive rare and never-before-seen footage in an unusual exploration of how the Dalai Lama’s interest in modern scientific theory — cosmology, quantum physics, cognitive psychology, neuroscience, as well as molecular biology and genetics — has influenced his Buddhist philosophy over the years. 

Despite having numerous films made about his life story, his contributions in the field of science for the past 35 years had never been a focus before. This was what motivated Ms Engle to capture this aspect of the Dalai Lama, who described himself as a “half Buddhist monk, half scientist”. 

The deep love and respect that the Dalai Lama has for science were perhaps most vividly exemplified in a particularly touching moment in the film. Dr Francisco Varela, the late neuroscientist, was an old friend and spiritual brother to the Dalai Lama. Despite his demise almost 20 years ago, the Dalai Lama would still carry a photograph of Dr Varela in his pocket everywhere he travelled. 

Chilean neuroscientist Dr Francisco Varela (left) with the Dalai Lama (right). | Photo Credit: PeaceJam Foundation

The story of his friendship with Dr Varela, that began through a series of dialogues between scientists and the Dalai Lama sponsored by the Mind and Life Institute, was the “heart and soul of the movie”. 

Ms Engle said: “(Their friendship) is so real and it’s so true.” 

The documentary has since received 42 awards from multiple film festivals around the world, attracting wide support from audiences in Singapore, South Africa, Vietnam and many other countries.

Most importantly, Ms Engle said that the Dalai Lama actually watched the film and liked it, even though “he never watches films”. 

While the film has been a success, the filmmaking process was by no means an easy feat. It cost US$1 million (S$1.36 million) and took the production team six years to finish, while the other films in the series usually only took a year. 

Being a Christian and a trained economist, Ms Engle required a large team of Buddhist and scientific advisors to assist her and the audience in understanding the sophisticated aspects of Buddhist philosophy and its intersection with Western science. Other filmmakers who had attempted to do this eventually gave up and admitted defeat. 

Tibetan Buddhist monks learning science in a computer lab. | Photo Credit: PeaceJam Foundation

All of the hard work had one purpose — it was simply to let the audience discover the side of the Dalai Lama that consistently strives to reconcile religion and science for the benefit of humanity.

Ms Engle said: “Even though I am a Christian, I really believe he is one of the greatest human beings that I have ever met on this planet.” 

When asked what she finds most inspiring about the Dalai Lama, she answered: “His sense of calm, even when things are really hard.

“One of the things that he says is that, ‘There is always hope, (as) things are always changing. Because things are always changing, there is always hope that things can be made better. If everything always stayed the same, we would be stuck.’”

One Act of Peace at a Time

Ms Engle herself has been nominated for the Nobel Peace Prize 17 times. 

A notable achievement of Ms Engle and Mr Suvanjieff was their One Billion Acts of Peace Campaign. The campaign called for the creation of one billion high-quality projects designed to tackle 10 issue areas facing humanity by 2019. This earned them the nomination for the 2015 Nobel Peace Prize by six Nobel Peace laureates. 

When asked what it meant to be nominated by other laureates for such a prestigious award, Ms Engle said it was “the highest compliment that I could possibly receive”. 

With her work focused on the youth, her message for them is: “You have the ability to help at least one other person. I know you can. You have the ability to make a real difference. Believe it and go do it.”

She also emphasised the importance of staying active and engaged on issues around us, adding: “We have to understand that we are the people and we have the power. If we just vote once every four years and do nothing, we are just giving (away) that power, right? 

“All of our work is about empowering others to be positive agents of change.”

Capital Relocation: Kalimantan, The Future of Indonesia

The following article originally featured on The IAS Gazette. Read it in its original form here

Jakarta is overpopulated, polluted and sinking. The Indonesian government is planning to relocate the administrative centre to the less densely populated island of Kalimantan, but what should we know about the new capital?

By Yoke Clara Yansim / June 12, 2020

Edited by: Robin Choo

Indonesia’s capital, Jakarta, is overpopulated, polluted and sinking. Its status as the capital city is soon to be taken over by a new city in the province of East Kalimantan near the cities of Samarinda and Balikpapan. 

President Joko Widodo announced the relocation in August last year, citing reasons of addressing inequality and relieving some of the burden on Java – an island one-quarter the size of the island of Kalimantan (which is also called Borneo) – but currently housing 60 per cent of the country’s population. Another major factor is the strategic location of Kalimantan, which is a much more central island in the archipelago than Java.

The government plans to begin construction of the new city from 2021 and may start relocating some offices from 2024, according to the planning minister Bambang Brodjonegoro. 

However, Finance Minister Sri Mulyani Indrawati said in April that Indonesia’s investment in this mega project to relocate its capital city has been put on hold to reallocate most of the funds for the Covid-19 outbreak response, but the programme may resume next year.

Nevertheless, this new capital not only represents the future of Indonesia, but it also possesses the glory of the nation’s past. 

East Kalimantan’s ancient past

The area within the districts of Kutai Kartanegara and Penajam Paser Utara has been chosen as the location for the new capital city of Indonesia. 

What is not often known is that the area also boasts a long and rich history, having been the place where one of the earliest ancient kingdoms in the archipelago once stood. 

Established around 400 AD, Kutai Martadipura was a Hindu kingdom led by Maharaja Kudungga, who was presumably of local Dayak origin. The legacy of the kingdom was found in Kutai, Kaman Estuary, near the Mahakam River in the form of seven stone pillars called Yupa inscribed in the Pallava script of India. From the inscriptions, the names of three rulers are known: Kudungga, his son Aswawarman, and his grandson Mulavarman. 

The Museum of Mulawarman in East Kalimantan. | Photo Credit: Jaka Thariq

Around the end of the 13th century, another kingdom, Kutai Kartanegara, was established in the region of Tepian Batu or Kutai Lama. Aji Pangeran Sinum Panji Mendapa, who ruled between 1635 and 1650, conquered Kutai Martadipura and merged the two into the kingdom of Kutai Kartanegara ing Martadipura. 

North Kalimantan Governor Dr Irianto Lambrie said during the Asia Competitive Institute Annual Conference in November 2019 that this long history of East Kalimantan makes it the “right” location for the new capital, adding: “Kalimantan is the future of Indonesia.”

The governor, who had pursued his career in East Kalimantan for 32 years, claimed that “the people of Kalimantan are very loyal to the Republic of Indonesia”.

What do the people say?

The Kutai Kartanegara district, like the rest of Indonesia, has a diverse population of about 780,000 people that consists of the native Kutai, Benuaq, Tunjung, Bahau, Modang, Kenyah, Punan and Kayan ethnic groups as well as Java, Bugis, Banjar, Madura, Buton, Timor and other immigrant ethnic groups. 

Meanwhile, with a population of 160,000 people, the Penajam Paser Utara district has thousands of Paser Balik and Dayak people living in it which identify themselves as two distinctive tribes.

Gawai Dayak Festival in Borneo: Where to Celebrate
The indigenous Dayak people in East Kalimantan. | Photo Credit: Barry Kusuma/Getty Images

East Kalimantan had been a popular destination for transmigration, with about one million transmigrants out of the 3.5 million population, according to a 2010 census. 

Jokowi’s government has recently reintroduced a new concept of transmigration, stipulated in the 2020-2024 Medium-Term National Development Plan (RPJMN). 

It will develop 52 transmigration sites into new cities, showing the government’s plan to redistribute economic activities from the densely populated Java and Bali to the less populated Papua, Kalimantan, Sulawesi, Maluku and Nusa Tenggara. 

Despite the government’s ambition, the transmigration programme and the capital relocation plan prove to elicit mixed feelings among the local East Kalimantan people. 

In an interview with CNA, Mr Eko Supriadi – a traditional youth leader of Penajam Paser Utara – said he welcomed the plan to move the capital to East Kalimantan but has reservations about whether the government has plans to protect the existence of the indigenous people, who fear being further marginalised with the new development. 

Head of Paser Balik tribe Mr Sikbukdin, 56, claimed the tribe people were marginalised as schools were built closer to the transmigrants’ homes instead of the forest where they live, depriving them of education opportunities. Others have also pointed out the absurdity of the government taking back the land that had been given to them (as part of the earlier transmigration program) to make room for the new capital. 

Nevertheless, the governor of East Kalimantan, Isran Noor, has assured that the government would not neglect the indigenous communities, promising to take their views into account as “a meaningful input for the government”.

“They won’t be marginalised. They need to develop their capabilities, so they can participate in building the country,” he was reported saying to CNA. 

Conservationists are also concerned about the environmental destruction that might be worsened by the proposed relocation, more than what has already been caused by the logging and mining companies over the years.

However, Mr Bambang Brodjonegoro was reported in the South China Morning Post saying: “We will not disturb any existing protected forest, instead we will rehabilitate it.”

Why it is the ideal location?

The area for Indonesia’s future capital in East Kalimantan. | Photo Credit: Credit: President Joko Widodo/Twitter

Despite being the second-largest island of the archipelagic country and home to some of the world’s biggest coal reserves, Kalimantan Island only contributes 8.2 per cent of the nation’s GDP. 

It is hoped that the relocation of capital, as well as the development of Special Economic Zones (SEZs), will reduce the development inequality between Java and other islands of Indonesia.

President Joko Widodo said in a televised speech: “The location (of the new capital) is very strategic – it’s in the centre of Indonesia and close to urban areas.” The proposed area is also less prone to disasters such as earthquakes, floods, forest fires, landslides and eruption. 

The fact that these two districts are easily accessible and disaster-proof makes them the ideal choice for the new political and administrative centre of Indonesia. 

This is, of course, in stark contrast with the current situation in Jakarta.

One major problem with the current capital of Indonesia is the dramatic rate at which Jakarta is sinking. It is one of the fastest-sinking cities in the world, and the impact is immediately apparent in North Jakarta. 

This is happening partly due to the excessive extraction of groundwater for everyday purposes by city dwellers. Some social media users have also criticised the Indonesian government for not doing enough about climate change

Flash floods in Jakarta. | Photo Credit: Mast Irham/Shutterstock

Besides that, the city of Jakarta has a very high population density of 14,464 square kilometres according to the World Population Review, meaning that it is about twice as densely populated as Singapore. This has led to its notorious traffic congestion, making Jakarta the 12th most congested city in the world. 

Is Jakarta being abandoned?

Not quite. 

The capital relocation is meant to ease the overwhelming burden on Jakarta, but Jakarta will remain the nation’s commercial and financial centre, much like New York City in the United States. 

Many Jakarta residents felt that the city will continue to play an important role and complement the new capital, for Jakarta is not merely the nation’s administrative capital, but also the centre of economy, education institutions and culture.

In order to avoid repeating the same mistakes in managing Jakarta, Indonesia has selected McKinsey & Company to conduct a feasibility study on the proposed site for the new capital in East Kalimantan, according to a report by Reuters.

McKinsey Indonesia will take on the government’s initial studies on issues including the social, cultural, environmental and economic impact, said Rudy Soeprihadi Prawiradinata, deputy for regional development at Indonesia’s Planning Ministry. Mr Bambang Brodjonegoro said: “We want to have a capital that represents the nation’s identity and improves the efficiency of the central government and establish a smart, green and beautiful city.”

The Rise of Special Economic Zones in Indonesia

The following article originally featured on The IAS Gazette. Read it in its original form here

Indonesia seeks to stimulate economic dynamism by attracting investment through its Special Economic Zones.

By Lisa Khou and Yoke Clara Yansim / June 4, 2020

Edited by: Robin Choo

President Joko Widodo during the Indonesia Infrastructure Week 2018. | Photo Credit: Republic of Indonesia National Council for Special Economic Zone

Hailed as the largest economy in Southeast Asia (not by GDP per Capita measurement but overall), Indonesia has been one of the countries that have seemed to place their eggs in the SEZ basket. With 13 SEZs and more in the making, Indonesia has growing confidence in its potential to harness its abundant natural resources, alongside its financial sector, to ensure successful SEZ policies are implemented. 

What exactly are SEZs?

The ever-growing demand to draw investment into both developed and developing countries has been reflected in the adoption of many industrial policies where special regulatory regimes called Special Economic Zones (SEZs) have been implemented. 

According to the United Nations Conference on Trade and Development (UNCTAD) World Investment Report 2019, SEZs are specific geographically delimited areas within which governments facilitate industrial activities, through providing infrastructure support outside the zone, fiscal and regulatory incentives. 

Think special export processing zones, reliable infrastructure support, relief from customs duties and tariffs that promote a business-friendly environment – all constructed with the purpose of conveniently bringing multiple companies into one geographical location. 

The report also states that there are about 5,400 zones across 147 developed and developing economies globally, with more than 500 new SEZs to come. The SEZ boom is seen to be a part of a new wave of industrial policies undertaken and a response to increasing competition for internationally mobile investment. 

The historical trend in SEZs. | Photo Credit: UNCTAD

SEZs are where states aim to generate synergies, networks, and knowledge spillovers to foster additional economic activity in areas outside of the zones. In return for these concessions, governments expect the investment and businesses operating in the SEZs to create job opportunities, diversifying and boosting the productivity of the country’s economy. 

The beauty found in SEZs is that every SEZ has its own distinct regulatory regime. Even with the common goal to catalyse economic growth, they are subject to unique economic regulations in each area, showing that different approaches can be adopted with the same end in mind.

China has been one of the few successful countries leveraging these SEZs, and it also accounts for more than half of the world’s total SEZs. After decades of a centrally planned economy in China, the proliferation of SEZs has provided an opportunity to liberalise the state.

Indonesia’s high hopes for its SEZs

According to Bambang Wijanarko, Deputy Director for Development and Management Controlling of the Secretariat of the National Council for Special Economic Zone, the SEZs in Indonesia are aimed to stimulate economic growth throughout Indonesia, where there is uneven economic growth distribution in the country with growth concentrated on Java Island. 

The SEZ policies implemented in Indonesia have four main goals:

  1. To increase investment by providing competitive geo-strategic and geo-economic zones
  2. To accelerate equitable growth by establishing new economic growth centres in different regions in Indonesia
  3. To optimise industrial, export, import & other high-value economic activities
  4. To develop a new model of regional development that would increase job creation

Indonesia has high hopes for the SEZs, believing the particular incentives and multi-activity facilities designed will attract foreign investments and also generate positive performances on the surrounding regions outside of the SEZs.  

SEZ distribution map in Indonesia. | Photo Credit: Republic of Indonesia National Council for Special Economic Zone

The question now is, with the current 13 SEZs that Indonesia has developed in the pursuit of economic development, have they achieved their goals? 

There was a slow development pace of the SEZs, where the pressure to meet project target deadlines meant that these zones had limited designs and project management capabilities, where technical errors during constructions and inadequate preparation resulted in these zones being under-prepared. 

Of course, in such a competitive industry as the SEZs where there is always the emergence and promise of new zones, the poor structuring resulted in a lack of interest from investors despite all the proposed incentives set to attract them. The performance of many zones fell below expectations, failing to attract the significant investment they hoped to achieve. 

Indonesia’s Economic Affairs Minister Darmin Nasution stated that the realized investment in the country’s 13 SEZs totalled Rp21 trillion (about US$1.5 billion), only about 25 per cent of the total investment commitment of Rp85.3 trillion. 

Of the 33 Chinese companies that announced plans to set up or expand abroad from June to August last year, not one was planning to move to Indonesia. Unfortunately, much of the development costs that went into building the SEZs could not be recovered as it did not attract the anticipated influx of investors. Many of these SEZs have remained underdeveloped and underutilised for decades.

What makes SEZs so unique?

The term ‘SEZ’ often encompasses different types of zones such as Free Trade Zone (FTZ) and Export Processing Zone (EPZ). Unlike FTZ and EPZ ─ which are similar in the way that they are mainly export-oriented ─ SEZ is an enclave of enterprises operating in a well-defined geographic area where certain economic activities are promoted by a set of policy measures that are not generally applicable to the rest of the country. 

Taxpayers conducting business in SEZs may enjoy tax facilities, and the business should cover the main activities determined for each SEZ based on the comparative advantage of the area. For instance, the Galang Batang SEZ in Bintan focuses on the bauxite-processing industry and logistics, while the Tanjung Kelayang SEZ in Belitung prioritises tourism. 

Bambang Wijanarko during the annual Asia Competitiveness Conference last year stated that there can also be the development of several zones within the SEZs, like a tourism zone, export-processing zone and other economic activities. This model of regional development will give more authority to private enterprises to build their own business activities, he added. 

The SEZ policies offered a departure from the more rigid rules of FTZ and EPZ, as it adapted to the new demands of the industry while sustaining its basic charms to potential investors: business-friendly environments armed with incentives that were moulded to fit the unique activities that have been identified for each region. 

So, are SEZs actually worth it?

Whether SEZs have achieved their objectives is not entirely clear. The World Bank operational review of SEZs has shown that SEZs have the power to bring FDI and new businesses to regions and to boost exports, but it is still unclear if SEZs necessarily increase employment and achieve positive spillovers in the larger region. 

The review also recommends that SEZ policies should be developed while keeping in mind the precise social, political and legal contexts in which the zone operates. This means that even the geographical location of SEZs and their comparative advantage – as well as the supporting policies beyond the SEZ policy framework – matter. Furthermore, the success of the zones is dependent on factors within and outside of the zone, or in other words, how the SEZ program interacts with the strategic location it is in.

Despite these concerns regarding SEZs, new zones are still being developed in Indonesia, with more being proposed in Sumatra, Sulawesi and Java as governments remain competitive in this industry to emulate success stories. A new question also arises – will policymakers be able to balance creating successful SEZs while facing challenges brought about by the ever-changing dynamics of SEZs? 

Indo-Pacific: The New Buzzword for the Region

The following article originally featured on The IAS Gazette. Read it in its original form here

The term ‘Indo-Pacific’ has been thrown around recently, but what does it mean to different countries and why is it being used?

By Yoke Clara Yansim / June 1, 2020

Edited by: Robin Choo

Members of HMCS WHITEHORSE approach a U.S. Coast Guard vessel in a Rigid Hulled Inflatable Boat (RHIB) to exchange passengers as part of a PASSEX during Operation CARIBBE, in the Pacific Ocean, March 26, 2019. | Photo Credit: OP CARIBBE Imagery Technician

After the Trump administration’s adoption of the Indo-Pacific strategy in 2017, the idea of the ‘Indo-Pacific’ as a regional concept has since increasingly grown in salience, with different countries putting forward their own perspectives on the region. 

What is the ‘Indo-Pacific’?

Diagram showing the comparison between the Indo-Pacific and Asia-Pacific. | Photo Credit: International Institute for Strategic Studies

In broad terms, the ‘Indo-Pacific’ is an imaginary space that links the Indian Ocean with the Asia-Pacific. The term ‘Indo-Pacific’ is not new by any means, but countries around the region have become more invested in the concept amidst geopolitical shifts in the Asia-Pacific region.

All four members of the informal Quadrilateral Security Dialogue, or the ‘Quad’ – the United States (US), Japan, India and Australia – have each offered their own views on the Indo-Pacific. ASEAN, being right in the heart of the so-called ‘Indo-Pacific’, has also developed the “ASEAN Outlook on the Indo-Pacific”.

However, an assessment by the Asia Strategy Initiative (ASI) shows that there is a significant difference in the geographical coverage of the Indo-Pacific.

The US describes the Indo-Pacific region as ranging from the west coast of India to the western shores of the US, aligned with the Indo-Pacific Command’s area of responsibility. Meanwhile, Japan, Australia and India define the Indo-Pacific as including the entire Indian Ocean from the eastern coast of Africa across the Pacific Ocean to the Americas. ASEAN does not regard it as a contiguous territorial space but as a closely integrated and interconnected region.

Origins of the term ‘Indo-Pacific’

Indian naval officer Capt Gurpreet S. Khurana formally introduced the term ‘Indo-Pacific’ in early 2007 in the article “Security of Sea Lines: Prospects for India-Japan Cooperation”.

Later in August 2007, Japanese Prime Minister Shinzo Abe gave a speech to the Indian parliament entitled “Confluence of the Two Seas”, which talked about the “dynamic coupling” of the western Pacific and the Indian oceans as “seas of freedom and of prosperity”. Almost a decade later, Abe reiterated the idea and introduced the term ‘Free and Open Indo-Pacific’ (FOIP), which was echoed by Trump in his 2017 speech at the Asia-Pacific Economic Cooperation (APEC) CEO Summit in Vietnam.

Indo-Pacific: To each their own? 

Last year, the US Department of Defence published the “Indo-Pacific Strategy Report” that outlined the nation’s vision and principles for a ‘free’ and ‘open’ Indo-Pacific. 

In the report, the US defines a ‘free’ Indo-Pacific as one in which all nations, regardless of size, are able to exercise their sovereignty “free from coercion by other countries”, which seems to be pointed at China. Meanwhile, an ‘open’ Indo-Pacific strives to promote sustainable growth and connectivity in the region.

The US and Japan, along with India and Australia, have advocated for the maintenance of a rules-based order in the Indo-Pacific, with the same focus on free markets, maritime security and freedom of navigation, peaceful resolution of disputes in accordance with international rules and norms, as well as – and perhaps more importantly – ASEAN Centrality.

ASEAN flags. | Photo Credit: ASEAN

Similar to the other perspectives on the Indo-Pacific, the ASEAN Outlook on the Indo-Pacific (AOIP, or commonly referred to as ‘the Outlook’) talks about inclusivity, openness, good governance and respect for international law. The Outlook has been officially welcomed by the US for its close complementarity with the US’ Indo-Pacific strategy. At the 22nd ASEAN+3 Summit Meeting in November last year, Prime Minister Abe also mentioned that Japan intended to pursue synergies between the Outlook and the FOIP, and contribute to enhancing connectivity for achieving a free and open Indo-Pacific.

The broad areas of cooperation identified in the ASEAN Outlook are: maritime cooperation, connectivity, UN Sustainable Development Goals (SDGs) 2030, among others.

During the Jeju Forum – ISEAS Conference held in October last year, Ms Hoang Thi Ha said: “The Outlook continues ASEAN’s traditional ‘open-door’ policy which engages all ASEAN friends and partners.” 

The Outlook itself does not introduce any radical new ideas. Instead, it chooses to reaffirm the existing ASEAN-led architecture (such as the East Asia Summit) and it envisages ASEAN Centrality as its underlying principle. 

The lead researcher at the ASEAN Studies Centre of the ISEAS-Yusof Ishak Institute added that ASEAN subscribes to an open, inclusive and rules-based regional order amidst heightened tendencies and pressures towards bipolarisation in regional politics.

Indo-Pacific responses to the US-China competition

Photo Credit: Tzogia Kappatou/Getty Images

Prof Zhu Feng, who was also present at the conference, cited several major reasons on China’s part for changes in the US-China relations: China’s growing assertiveness in foreign relations, technology innovation, President Xi Jinping’s overconfidence and the Chinese Dream of National Rejuvenation. 

Prof Zhu, who is the Dean of the School of International Relations in the Nanjing University, thus viewed the Indo-Pacific strategy as some sort of “strategic regrouping” against the backdrop of power redistribution in the Asia-Pacific, with Japan, India and ASEAN being called into the American side in order to balance China.

While the US singles out China, Russia and North Korea as potential security threats, the Outlook stresses ASEAN’s role as an “honest broker within the strategic environment of competing interests”. This is clear in the way ASEAN has put a cautious emphasis on the idea of inclusivity, but avoids using the word “free” as the US and Japan have. 

Ms Hoang said the Outlook is a pragmatic development-oriented approach which views the Indo-Pacific less as a security-driven phenomenon, but more as an economic and connectivity linked construct. The Outlook places emphasis on dialogue and economic functional cooperation, but it shies away from “strategic competition and the narrative of containment”.

All the other Quad members have slightly different stances with regards to the geopolitical changes in the region.

Australia, through its defence white papers, has implicitly argued for a balance between the United States and China. Japan’s FOIP is largely aligned with the US’ Indo-Pacific strategy, but it underscores the importance of “enhancing connectivity through quality infrastructure” beyond East Asia into the Middle East and Africa. 

The Indian Prime Minister Narendra Modi articulated India’s vision for the Indo-Pacific as a “free, open, inclusive” region in his keynote address at Shangri La Dialogue in 2018. Like ASEAN, India’s use of the word “inclusive” seems to point to a strategy of “dodging”, as some have argued. However, Dhruva Jaishankar wrote in Brookings that India’s Act East Policy, in fact, allowed India to play a meaningful role in managing China’s rise, and help shape the regional order that was advantageous to Indian interests. 

‘Lack of collective courage’

Ms Hoang commented that the problem with ASEAN has never been the absence of principles governing interstate relations. 

For example, ASEAN has the Treaty of Amity and Cooperation in Southeast Asia (TAC). Signed in 1976 by leaders of the founding members of ASEAN, it established some of the defining principles of ASEAN, such as mutual respect for the independence, sovereignty, equality, territorial integrity and national identity of all nations, as well as non-interference in the internal affairs of one another.

There are also the “Bali Principles”, or the Principles for Mutually Beneficial Relations under the 2011 Declaration of the East Asia Summit, which also governs relations between states in the Southeast Asia region. Some of the principles include upholding international law, refraining from the use of military actions and settling disputes peacefully.

Ms Hoang argued: “The problem (with ASEAN) has been more of the lack of the collective courage to keep to such principles, especially by calling out the violations when they happen,” bringing up the example of the South China Sea.  

On the issue of the South China Sea, ASEAN as a whole has maintained its neutrality on the merits of territorial claims, leaving any resolution to the claimants. 

The Outlook, Aristyo Rizka Darmawan wrote, might “help the region in navigating and maintaining the peaceful South China Sea”. The current practice shows that the Southeast Asian nations do not have the same political views on which side to take, and that the political considerations are more fluid and led by national interest.

As such, the Outlook might strengthen the region with their own version on how ASEAN should engage with the Indo-Pacific region. Moreover, it can also set the rules of the game, by reiterating the regional commitment in respecting the rule of international law in the region, particularly the United Nations Convention on the Law of the Sea (UNCLOS). 

Observing the recent events in the Indonesian Natuna islands, it is possible that ASEAN will take a harder position against China, especially with Vietnam as the ASEAN chair. Indonesia – playing a key role in the ongoing negotiations over the proposed Code of Conduct – has been pushing for a united ASEAN approach to speak as one, instead of 10 distinct parties.

This may well be an opportunity for the Outlook to demonstrate ASEAN’s commitment to the principles that have been outlined in the document, to show what the ‘ASEAN unity’ really means.

A Singapore Story

The following article originally featured on North. Read it in its original form here.   

Yoke Clara Yansim weaves in her wonderful words and photos in this ode to Singapore. 

By Yoke Clara Yansim / May 5, 2020

When I first moved to Singapore at fourteen years old, I was constantly overwhelmed by how fast-paced everything was.

© 2016 Yoke Clara Yansim

I remember how I was struck by how quickly people were walking in the Mass Rapid Transit (MRT) stations, especially during rush hour.

© 2019 Yoke Clara Yansim

School was stressful with assignment after assignment, test after test.

© 2016 Yoke Clara Yansim

The education system in Singapore is one of the best in the world, after all.

© 2016 Yoke Clara Yansim

I did not like living here then.

© 2019 Yoke Clara Yansim

Fortunately for me, there were many kind people who helped me get settled along the way – they tried very hard to make Singapore feel like my second home.

© 2019 Yoke Clara Yansim

Now, I see that Singapore is so much more than what I had perceived six years ago.

© 2018 Yoke Clara Yansim

I have come to adapt and appreciate the work ethic and efficiency that are so valued in Singapore.

© 2019 Yoke Clara Yansim

The orderliness, the cleanliness and the safety of the city-state are some of the best things about Singapore – everyone knows that.

© 2016 Yoke Clara Yansim

The city is also enriched by the diversity of traditions, languages and food of the different cultures present in Singapore.

Little India
© 2016 Yoke Clara Yansim

But most of all, I love the quieter side of Singapore.

© 2019 Yoke Clara Yansim

I love watching people enjoy their afternoon strolls around the neighbourhood and having meals together in the local coffee shops and hawker centres.

Singaporean breakfast
© 2018 Yoke Clara Yansim

I love seeing people sitting at the void decks reading newspapers and socialising.

© 2016 Yoke Clara Yansim

Unfortunately, with the current coronavirus situation, many of these activities are no longer possible.

© 2019 Yoke Clara Yansim

Common areas are closed off to the public, and tables and chairs at the coffee shops are kept away to prevent people from gathering unnecessarily (and illegally).

© 2016 Yoke Clara Yansim

But given what I know about Singaporeans, they will bounce back from this crisis.

© 2016 Yoke Clara Yansim

They are resilient. They are hardworking.

© 2019 Yoke Clara Yansim

Life may never be the same again, but we have hope.

Two Groundbreaking Records Set as Singapore Commemorates Bicentennial

The following article originally featured on The IAS Gazette. Read it in its original form here.   

Last December, in commemoration of the bicentennial anniversary of the founding of modern Singapore, the nation’s first-of-its-kind ground-up initiative celebrated the nation’s peace and prosperity by breaking two new records in the Singapore Book of Records – the Largest Mass Lion Dance Display and the Largest Lion Eye-dotting Ceremony.

By Yoke Clara Yansim / April 24, 2020

Edited by: Elaine Lee

An assembly of 720 lions that created a new record for “Largest Mass Lion Dance Display” in the Singapore Book of Records. | Photo Credit: Eunice Rim/The IAS Gazette

Last December, Miss M Abinaya and her family, along with thousands of others, braved the rain to watch the Peace and Prosperity Singapura (PPSG) 2019 parade at The Float at Marina Bay.

The 20-year-old software developer told The IAS Gazette that her father has heard about the parade on Tamil radio and decided to bring the family to the event to spend some quality time together.

In celebration of the nation’s peace and prosperity in commemoration of the bicentennial anniversary of the founding of modern Singapore, the three-hour parade which was organised by Tao One, a Taoist non-profit organisation, featured a variety of live music performances by local artistes, lion dance on high poles, a car parade with 54 Lamborghinis, and a contingent of musicians and percussionists.

The event also included an interfaith prayer for Singapore’s continued peace and prosperity, led by leaders from the Inter-Religious Organisation.

Senior Minister of State Dr Maliki Osman said: “PPSG 2019 celebrates inter-racial and inter-religious harmony, and while at the same time, reminds and educates the community on how far we have come to achieve that harmony. (It) must not be taken for granted and needs to be continuously cultivated.”

The event also saw the largest assembly of lions – a total of 720 – on display in South-east Asia, generating two new records in the Singapore Book of Records – Largest Mass Lion Dance Display and Largest Lion Eye-dotting Ceremony.

Signifying 720 years since the discovery of the Lion City by Sang Nila Utama in 1299, 720 old and new lions were used to symbolise the social diversity and the transitioning of one generation of Singaporeans to the next.

The eyes of the new lions, which donned the red and white colours of Singapore, were also dotted by distinguished guests in order to “wake” the lions.

Minister of Education Mr Ong Ye Kung in the lion eye-dotting ceremony. | Photo Credit: Joseph Poh Shou Heng/Tao One Ltd

Commenting on the parade, student volunteer Lee Ming Yi said: “(PPSG 2019) actually tried to incorporate different elements, (such as) singing songs in different languages and having four hosts speaking in different languages to cater to all the people of different races who are watching the show.”

While the parade has successfully promoted inclusiveness, the 15-year-old felt that more could be done.

“There might be some kind of impact, but it’s not as big an impact as, say, a long-term education.”

Student volunteer Lee Ming Yi (left) with his other volunteer friends. | Photo Credit: Eunice Rim/The IAS Gazette

Throughout its history as a port city, Singapore has been a melting pot of cultures and ethnicities, comprising four main ethnic groups: Chinese, Malays, Indians and Eurasians.

Today, underneath conscious efforts by the government to preserve multi-religious and multi-racial harmony, Singapore also grapples with xenophobic sentiments towards foreigners, as the world’s most competitive economy increasingly relies on immigrants to help shoulder its economic burden, especially with low population growth.

While these issues continue to be addressed one step at a time, Miss Abinaya believes that one thing that Singapore can learn from the past 200 years is to “be together in all situations and stand up for each other”.