The economic and security conundrum posed by Indonesia’s archipelagic geography is not new. The combination of 17,000 islands with an underfunded navy and poor port infrastructure results in widespread piracy, illegal fishing, and smuggling. The extraordinarily high costs of transporting goods domestically makes it cheaper for Indonesians to consume foreign goods than domestic ones, and makes the nation function more as a collection of weakly integrated economies than as a unified market.
Successive Indonesian leaders have struggled with these economic and security challenges. Indonesia’s new president, Joko “Jokowi” Widodo, wants to tackle them and embrace Indonesia’s geography as an asset, not a disadvantage. Maritime policy will be a top priority for Jokowi’s first few years in office, which offers the United States and other partners opportunities for cooperation with Indonesia on maritime security.
Since his inauguration in October, Jokowi’s public remarks to a range of audiences, both domestic and international, have made reference to his vision for Indonesia as a “global maritime nexus.” The content of this policy remained largely rhetorical until Jokowi’s speech to the East Asia Summit (EAS) in Naypyidaw, where he explained the five underlying pillars of the policy:
1. A revival of Indonesia’s maritime culture, recognizing the link between the country’s archipelagic geography, identity, and livelihood;
2. Improved management of Indonesia’s oceans and fisheries through the development of the country’s fishing industry and building maritime “food sovereignty” and security;
3. Boosting Indonesia’s maritime economy by improving the country’s port infrastructure, shipping industry, and maritime tourism;
4. Maritime diplomacy that encourages Indonesia’s partners to work together to eliminate conflict arising over illegal fishing, breaches of sovereignty, territorial disputes, piracy, and environmental concerns like marine pollution; and
5. Bolstering Indonesia’s maritime defenses, both to support the country’s maritime sovereignty and wealth, and to fulfill its role in maintaining safety of navigation andmaritime security.
Jokowi has appointed Indonesia’s first coordinating minister for maritime affairs, Indroyono Soesilo, who will assume oversight for the ministers for transport, tourism, energy, and fisheries. Indroyono, a U.S.-educated technocrat, returned from a posting as the director of fisheries at the United Nations’ Food and Agriculture Organization to take up the coordinating post. On paper, Indroyono’s maritime affairs portfolio looks to have real clout, but realizing its potential will be tricky because it cuts across ministries in which institutionalized self-interest and rent-seeking will prompt resistance to integration and change.
Funding for the five maritime policy pillars will need to be redirected from other areas of government spending. Jokowi has eased some of the budget pressure by recently cutting expensive domestic fuel subsidies. But while some of the $8 billion saved by raising fuel prices will be available for infrastructure construction, much of it is earmarked for the government’s health, education, and agriculture budgets.
Indroyono has said that Indonesia needs to invest an estimated $6 billion to transform its inadequate port infrastructure. Jokowi used his Asia-Pacific Economic Cooperation summit speech to implore foreign investors to provide the funding required for vital upgrades to the country’s ports. The government hopes that foreign firms will be tempted by Jokowi's “open for business” sales pitch as its own coffers will be able to contribute only part of the cost of these massive projects.
The new coordinating ministry is important, but changing the lines of reporting within the cabinet will not be enough to make ministries work together. Jokowi must be indefatigable in coaxing the notoriously glacial bureaucracy to work collaboratively, strategically, and in an integrated manner to realize his maritime infrastructure goals. The cabinet also needs to remain circumspect as to how much domestic integration is economically efficient. Integration is not a panacea, and there must be consideration of cases in which regions may trade more efficiently internationally than with Java.
On the maritime security and diplomatic aspects of Jokowi’s new policy, Foreign Minister Retno Marsudi will play a leading role. She has signaled her intention to deploy a more assertive, bilaterally driven, and self-interested approach to Indonesian diplomacy.
Retno has said she plans to continue to press for the completion of a code of conduct in the South China Sea between China and ASEAN. The United States has been more explicit in recent months about its desire to see a code of conduct finalized and a freeze on provocative acts in the South China Sea implemented. Washington will welcome more forceful Indonesian leadership on efforts within ASEAN to reduce tensions in the disputed sea.
In his EAS speech, Jokowi said Indonesia is “obliged” as a “fulcrum between two oceans” to bolster its maritime defenses both to protect its own sovereignty and for regional safety of navigation and maritime security. Indonesia’s navy will benefit from a targeted funding boost, as part of a planned increase in overall defense spending to around 1.5 percent of gross domestic product within five years from 0.9 percent at present. Coordinating Minister for Politics, Law, and Security Tedjo Edy Purdijatno, a former navy chief, has said the navy will acquire new submarines and other patrol and combat vessels.
Tedjo has also signaled his plan to create a new coast guard to “make sure businesses that use sea transportation are not harmed.” Indonesia has long aspired to create a unified branch to replace the motley group of agencies that handle different aspects of maritime and port security. An adequately resourced coast guard will be well-placed to tackle the illegal smuggling of commodities, in which the Indonesian police and military have taken part in occasionally violent competition.
With Indonesia looking ready to flex more diplomatic and strategic muscle, it will be important that it continue to channel sensitive issues, including with China over the waters and seabed off the Natuna Islands in the South China Sea, through regional security apparatuses.
For Indonesia’s trading and security partners, Jokowi’s maritime policy presents interesting opportunities for collaboration. The U.S. and Indonesian navies have cooperated on a range of issues in recent years including anti-piracy efforts; joint training activities like the Komodo Multilateral Exercise, Cooperation Afloat Readiness and Training, the Rim of the Pacific, and those under the ASEAN Defense Ministers Meeting-Plus (ADMM+); and forums such as ADMM+ and the Expanded ASEAN Maritime Forum. The habits of cooperation are becoming more established and could now be leveraged in bilateral areas to support Jokowi’s maritime vision.