Jokowi’s pro-investment reform push will founder

Significance

In his inauguration speech, he expressed commitment to reforms that he believes can help the country attract investment and escape a middle-income trap. Meanwhile, there are indications that several parliamentary parties want to amend the constitution to reduce presidential power.

Impacts

• Jokowi will probably delay implementing some of his controversial reforms to the country’s leading anti-corruption body.
• Any constitutional amendment to end direct presidential elections would raise fears among investors about good governance in Indonesia.
• Most investors will welcome Jokowi’s retention of Sri Mulyani Indrawati as finance minister.