Honorary Consulate of the Republic of Indonesia in Botswana

Honorary Consulate of the Republic of Indonesia in Botswana Honorary Consul for the Republic of Indonesia in Botswana

04/05/2025
Ramadan Mubarak to all our friends and all Muslims around the world
03/03/2025

Ramadan Mubarak to all our friends and all Muslims around the world

Botswana votes today. Wishing all voters a very peaceful, free and fair process in accordance with the impeccable reputa...
30/10/2024

Botswana votes today.
Wishing all voters a very peaceful, free and fair process in accordance with the impeccable reputation they have garnered since independance.
Proud to be part of this process.

*Middle Powers Are the New Architects of the World Order: How Emerging Nations Are Bridging the Deepening Rifts Between ...
05/07/2024

*Middle Powers Are the New Architects of the World Order: How Emerging Nations Are Bridging the Deepening Rifts Between Major Powers*

By *Dino Patti Djalal*, previously Indonesia's ambassador to the U.S., is founder and chairman of the Foreign Policy Community of Indonesia and chair of Middle Power Studies Network.

Published in Nikkei, July 4, 2024
https://asia.nikkei.com/Opinion/Middle-powers-are-the-new-architects-of-the-world-order
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Public discourse on international affairs usually points to the rise of China as the hallmark of the evolving world order.

This is not wrong, but no one should overlook another seismic trend in international affairs: the rise of middle powers. In a world of increasing geopolitical rivalries, middle powers are making a difference by bridging divides, providing solutions and building regional architectures.

While there are many definitions of middle power, here I refer to countries that by virtue of their considerable size (population and geography), weight (economic, diplomatic and military strength,) and ambition, fall between the small power and great power categories.

Of the 193 countries in the world today, around two dozen qualify as middle powers; some are in the Global North but the majority are in the Global South.

While all of the middle powers of the North are committed to military pacts, most middle powers in the Global South are nonaligned and tend to pursue strategic hedging. Collectively, these middle powers have become a big factor in the global power shift.

Presently we have the highest number of middle powers in history, and this number will grow as such countries as Pakistan, Mongolia and Ethiopia enter the category.

But it is not just the quantity that counts; there is also a qualitative difference. The middle powers of the Global South are stronger and richer than they were when the Non-Aligned Movement came to birth six decades ago. India's defense budget is larger than that of the U.K., Saudi Arabia outspends France in this regard, while South Korea spends more on defense than Italy. By 2030, the forecast purchasing power parity (PPP) of Indonesia, Brazil, Mexico, Turkey and South Africa will be larger than that of Germany, Italy, Spain, the Netherlands and Sweden.

As they gain strength, these middle powers are acquiring self-confidence and a sense of entitlement.

Many middle powers of the Global South no longer find the world order works in their favor. They do not accept being patronized by the West, nor are they impressed by any claim to "exceptionalism." They are actively exploring the "third space," or "the middle ground," and are developing their own counter-narratives, such as the Asian Century, the African Century and the ASEAN Outlook on the Indo-Pacific.

The most visible expression of middle power entitlement is found in the region where they belong. This is particularly important because world affairs are increasingly shaped by regional dynamics.

There is at least one middle power of consequence in every region of the world, which was not the case in the 20th Century.

The commonality? A growing desire and capability to shape events in their neighborhood. This usually involves maximizing their role and sometimes taking the lead in the region, while keeping a lid on the ambitions of external powers.

Thus, in Southeast Asia, Indonesia worked with fellow ASEAN members to ensure that external powers such as the U.S., China and Russia play by ASEAN-devised rules and mechanisms.

Beyond their immediate regions, there is also a trend of middle powers coming together and becoming more assertive, creating and expanding their cooperation across the board, irrespective of rivalries that are happening around them.

While Western nations are beginning to de-risk from China and Russia, and as the space for dialogue between them shrinks, middle powers of the Global South are forming unprecedented economic, diplomatic and strategic links with one another.

For example, Indonesia now trades more with India than the U.S. and is building naval submarines with South Korea -- a strategic venture that is not possible with any Western country, Russia or China. It also matters that three middle powers of the Global South -- Indonesia, India and Brazil -- are assuming the G20 presidency successively and are working closely within the grouping's "troika" mechanism to maintain policy coordination. Meanwhile, more Global South countries -- 40 according to the South African government -- are lining up to join BRICS than those wishing to join OECD.

But there is also a new pragmatism that has led them to break old taboos: India, Indonesia and Vietnam have entered into robust strategic partnership agreements with the U.S., something that was unthinkable four decades ago due to their domestic political situations and historical baggage.

This is true not only in the Global South; the middle powers in the North are also moving the needle. Some of them, while preserving their treaty alliances and remaining distrustful of China, are increasingly keen to pursue independent initiatives.

Turkey, a member of NATO since 1952, in the face of Russia's invasion of Ukraine, has maintained relations with Moscow and facilitated talks between Ukraine and Russia. Unlike most European countries, Turkey has adopted a confrontational stance toward Israel, especially on the ongoing Gaza crisis.

Japan, a bedrock treaty ally of the U.S., has a staunch policy of always closely engaging ASEAN, irrespective of Washington's fluctuating attention to Southeast Asia.

Meanwhile, Australia has made a strategic decision to enter into a robust bilateral partnership with Indonesia. In 2022, at the height of the Russia-Ukraine war, Australian Prime Minister Anthony Albanese was the first Western leader to announce he would attend the G20 Summit in Bali, breaking ranks with other Western leaders who were wary of the prospect of sitting with Russian President Vladimir Putin, who in the end did not show up.

All in all, the middle powers are rewriting the world affairs playbook.

Cooperation involving the middle powers -- within the Global South, between the Global South and the North, between the Global South and the U.S. and China -- is reshaping the international order.

While the rise of the middle powers is bound to be a long drawn-out process, they are already providing an enabling environment to manage risks and expand opportunities in world affairs.

The middle powers of the Global South and the Global North can work together to shore up multilateralism and step up cooperation to address global agendas such as climate change, nuclear nonproliferation, food security, AI governance and sustainable development goals (SDGs).

By expanding their scope of cooperation and intensifying their confidence-building efforts, the middle powers can reduce, rather than enlarge, the space for geopolitical rivalry and mitigate the prospect of domination by any great power.

By constantly resorting to strategic hedging and diversifying their strategic relationships, middle powers can render multipolarity less volatile and more stable.

And perhaps as they keep up their steady rise they can eventually shape a more durable, inclusive and just world order that has so far eluded humankind.

How emerging nations are bridging the deepening rifts between major powers

Eid Mubarak to all!
17/06/2024

Eid Mubarak to all!

02/04/2024

5 Reasons Why You Should Invest in Indonesia Today!
31/05/2023


​Hi, Friends of Indonesia!

Are you aware of the compelling reasons to consider investing in Indonesia? At present, Indonesia stands as the 16th largest economy in the world by nominal GDP, boasting a robust GDP surpassing the remarkable threshold of US$1 trillion.

Notably, Indonesia's economy has demonstrated commendable resilience, showcasing a consistent annual growth rate of over 5% over the past two decades. The exception was the economic contraction of 2.07% in 2020 during the pandemic, that marked the first downturn since the occurrence of the Asian financial crisis in 1998.

1. ​Stable economic growth of >5% (y/y).

Presently, Indonesia is the 16th largest economy worldwide, boasting a GDP surpassing US$1 trillion. McKinsey & Company's estimation indicate that by 2030, Indonesia is anticipated to secure its place as the 7th largest global economy. It is worth noting that among Southeast Asian nations, Indonesia is the sole representative within the G20.

Throughout the past two decades, Indonesia has enjoyed economic stability, with consistent annual growth exceeding 5%. However, the year 2020 during the COVID-19 pandemic the country witnessed a notable contraction of 2.07%, marking the first downturn since the financial crisis that engulfed Asia in 1998.

2. COMPETITIVE & PREDICTABLE WAGES​

Provincial minimum wage 2022: US$126 - US$323 per month*
Provincial minimum wage growth in Indonesia is determined by a formula that was set in Government Regulation No. 78/2015.
Minimum Wage New Year = (Minimum Wage Old Year x {Annual National Inflation Rate + Annual National GDP Growth Rate})

3. 130+ MILLION OF EDUCATED WORKFORCE

Indonesia ranks as the 4th most populous nation globally, with a population of 272 million in 2020. Notably, two-thirds of this population fall within the working-age bracket, contributing to the country's vibrant labor force. Furthermore, the average age of Indonesians stands at 28 years old, reflecting a dynamic and youthful demographic profile.

4. OPEN POLICIES FOR INTERNATIONAL INVESTMENTS

​Most business fields are open for 100% foreign ownership

The concept of business fields concerning Foreign Direct Investment (FDI) and Domestic Direct Investment (DDI) is encapsulated in the "negative investment list." Notably, the revised Presidential Regulation No. 44/2016 on investment has expanded the scope of available business fields for FDI, fostering increased opportunities.

Minimum FDI of IDR10 billion (~US$700,000)

With minimum paid up capital of IDR2.5 billion (US$175,000) for Limited Liability Company (PT) (note: US$1 = IDR 14,500)

FDI and DDI obtain investment licenses through Online Single Submission (OSS) system

www.oss.go.id Investment services are provided at one-stop service centers (PTSP) at central & regional levels.

Established in the form of Limited Liability Company (PT)

Additional permissible forms for foreign entities include Foreign Representative Offices, which include general trading, oil and gas, and construction services. Furthermore, the options of establishing a Foundation or a Permanent Establishment (PE) are also available.

Allowed to employ expatriate(s)

Guarantee of no expropriation

Guarantee to freely transfer and repatriate

Capital/shares, dividend, interest, royalty, and (branch) profit; subject to With Holding Tax (WHT)

Must consider Corporate Social Responsibility (CSR), respect local culture and preserve environment

5. YOUNG AND INCREASING MIDDLE-CLASS POPULATION

Many Indonesians are joining the middle-class group. In fact, Indonesia has one of the world's fastest growing middle class. They are mostly young, optimistic and sophisticated buyers.

According to the World Bank, people with daily expenditures between US$7.75-US$38 are classified as middle-class. There are 52 million Indonesians that fall under the concrete middle class group.

Another group is the aspiring middle-class that spends between US$3.3-US$7.75 per day. Around 115 million Indonesians are in this category.

So, what you are waiting for? Swipe to immerse yourself in the ensuing discourse to uncover more advantageous insights on investment prospects in Indonesia.​

(Source: Statistics Indonesia, 2021; Letter of Indonesian Minister of Manpower No. B-M/308/HI.01.00/2019. Based on Bank Indonesia’s exchange rate US$1 = IDR14,350 (May 19, 2022); Law No.25/2007, Indonesian Investment Coordinating Board (BKPM) Regulation No.6/2018, No.7/2018 & No.5/2019, Government Regulation No.24/2018; World Bank; Copyright: Indonesian Consulate General in Vancouver)

13/01/2024

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