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Indonesia

Yearbook 2015

2015 IndonesiaIndonesia. The high expectations of Indonesia's President Joko Widodo, elected in 2014, were partly to shame. His government found it difficult to get through promised reforms and boost the economy.

The fall in commodity prices and lower demand from China was part of the explanation. Indonesia is a major producer of palm oil, tin, coal and other minerals.

The crisis was also noticed in the currency, rupee, lost in value. At times, it has been just as weak against the US dollar as during the 1998 financial crisis. However, the government continued to follow a law that the budget deficit should not exceed 3% of GDP.

2015 Indonesia

Widodo reshaped his government in August and appointed six ministers. A new addition as Secretary of Commerce was Harvard-educated economist Thomas Lembong.

According to COUNTRYAAH, several economic reforms were launched during the year. Foreigners would get open bank accounts and the government tried to lower import duties on a number of goods. Similarly, taxes would be lowered for export companies that retain their revenues in Indonesia or convert foreign exchange income to rupee. But barriers to hiring foreign labor remained, and plans for promised infrastructure investments at new ports and power plants appeared to be stuck in the mills of the bureaucracy. The Asian Development Bank estimated that only a tenth of the funding for infrastructure projects was paid out during the first half of the year, something the government intended to change.

Indonesia announced in September that the country will again join the OPEC oil cartel. The country went out of the cartel in 2009 when high oil prices, rising domestic demand and low in-house production made it a net importer.

Widodo visited the United States in October, one year after taking office. Following talks with President Barack Obama, he said Indonesia would join the new Trans-Pacific Partnership (TPP) free trade agreement signed between twelve Pacific countries. Widodo risks stirring up protectionist interests at home.

However, Widodo was forced to shorten its US visit as a result of extensive forest fires that created problems in relations with neighboring countries. The suffocating smoke caused death and tens of thousands of people suffered from respiratory distress. Schools were closed and air traffic in the region was also disrupted. According to the US Space Agency's NASA satellite data, more than 100,000 fires have raged since August. Nearly 22,000 soldiers were deployed to fight the fires and the country received assistance from Japan, Singapore, Malaysia and Australia.

The annually recurring fires in which forests in Sumatra and Borneo are mainly burned to clear land for agriculture, oil palm plantations and pulpwood were the worst in two decades. Drought caused by El Niņo weather phenomenon and severe fires in underlying peatlands exacerbated the problems.

The country's carbon dioxide emissions were increased and were periodically higher than the US and China's. Seven people linked to various forest companies were arrested in September for suspected environmental crimes in connection with the arson fires.

Indonesia was also criticized for having carried out a series of death sentences during the year, despite protests from the UN and affected countries such as Australia, Brazil and the Netherlands. Most of the executed had been convicted of drug offenses.

Concerns were expressed that Widodo had not done more to ensure the religious freedom of minorities, for example, several churches were burned and demolished in the province of Aceh in October. The churches were not said to have been licensed. Several thousands of Christians fled. Gay and transgender people were also persecuted in Aceh, where sharia laws prevail.

Indonesia and Malaysia agreed in May to temporarily provide protection for thousands of boat refugees from Burma's Muslim minority population Rohingya.

When in May, Widodo visited the eastern part of Papua, he promised relief for foreign visitors, including journalists, to visit the area. He pardoned five Papuan political prisoners, but the human rights group Amnesty International stated that dozens are still incarcerated. Similarly, journalists continued to be monitored during reporting trips to Papua. During the year, clashes occurred between security forces and rebels from separatist OPM (Organization for a Free Papua).

In April, the army and police launched a joint effort to track alleged supporters of the Islamic State (IS) terror group on Sulawesi. Indonesia also signed cooperation agreements with, among others, Australia and the United Kingdom to fight Islamist groups.

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