YOUR GUIDE TO INDONESIA’S POLITICAL & BUSINESS AFFAIRS | September 14th, 2018 Highlights of the week Team Jokowi forges ahead, Team Prabowo struggles The battle between Joko “Jokowi” Widodo and Prabowo Subianto are entering new phase. With the election campaign slated to start on Sept.23, incumbent President Jokow has put together his dream team. On the other hand, challenger Prabowo was reported to struggle building his own dream team. Overcoming the outbreak of the collective corruption Corruption oh corruption. The recently exposed collective corruption cases in several regional legislative councils are carrying two urgencies: the need for long-term anti-corruption programs and electoral system restructuring to end the vicious circle of corruption. OJK involves fintech association to police industry The Financial Services Authority (OJK) has stepped up its enforcement on the rapidly growing financial technology sector (fintech). The issuance of Regulation No. 13/2018 provides a thorough legal umbrella for the industry. With a lot of untapped potentials available, the regulator is teaming with industry’s players, such as the Indonesian Fintech Association (AFTech Indonesia) to avoid taking the wrong step. A fresh start to fix Garuda’s financial woes State owned airline Garuda Indonesia is attempting for a fresh start after being trapped with corruption and mismanagement issues. The appointment of new president director is slated to rejuvenate the biggest premium class airline in Indonesia. Nevertheless, tough challenges await the new board to bringing the company back on track. SUBSCRIBERS COPY, NOT FOR DISTRIBUTION For subscription: [email protected] 2 POLITICS Team Jokowi forges ahead, Team Prabowo struggles With the election campaign slated to start on Sept. 23, incumbent President Joko “Jokowi” Widodo has put together his dream team. Challenger Prabowo Subianto, meanwhile, is struggling to build his team because of competing interests among his supporters. While political bigwigs certainly add credentials to both teams, the real and most telling work in winning votes on April 17, will come from the army of young dedicated volunteers on each campaign trail. Background: Team Jokowi has a leader: Erick Thohir, the man who was credited for Indonesia’s recent success in hosting the Asian Games. A proven and well-connected entrepreneur, Erick will head the team comprising not only top leaders of the nine political parties in his coalition, but also public figures, including heads of regional governments. Prabowo is still sorting out his team and has until Sept. 22 to submit their names to the General Elections Commission (KPU). A military general is tipped to lead Team Prabowo. Insight: The appointment of Erick Thohir has boosted the credibility of Team Jokowi. His name was announced barely a week after the closing of the Asian Games on Sept. 2, a successful feat not only in terms of the performance of Indonesian athletes, but also the organization and logistical arrangements. Credit went to the 48-year-old founder and chairman of the Mahaka Group, a holding company that focuses on media and entertainment businesses. Erick brings not only proven managerial skills to the team, but also strong knowledge about young people through his business interests, always a crucial segment of voters. He owns the Republika daily newspaper and website, which in the past echoed the voice of conservative Muslims critical of President Jokowi. While he is not known to interfere too much in editorial decisions, it is unlikely that Republika will work against its owner. Erick’s appointment plugs the two gaps in Jokowi’s profile: attracting millennials and neutralizing opposition from conservative Muslims. Candidate Jokowi had already submitted the name of his official campaign team with the KPU on Aug. 20, before he announced Erick to lead his campaign last week. Team Jokowi includes all the chairs and secretary-generals of the nine political parties supporting his nomination. It counts on the support of Vice President Jusuf Kalla, former vice president Try Sutrisno and some members of Jokowi’s cabinet. But Finance Minister Sri Mulyati Indrawati, whose name was on the original list, has since announced that she had withdrawn from the team. No explanation was given. Team Jokowi was working at full steam even before Erick was included. It has since enlisted more public figures and religious leaders. Among the most prominent recruits are provincial governors, with one team spokesman bragging that at least 15 governors would join when the campaign begins. Among the governors who have publicly declared their support is Ridwan Kamil of West Java, the province which in 2014 voted overwhelmingly for Prabowo. Former West Java vice governor Deddy Mizwar, still a popular figure, has also thrown his support behind Jokowi. Two governors who ran on Democratic Party tickets, Muhammad Zainal Mahdi of West Nusa Tenggara and Lukas Enembe of Papua, said they would defy their party and support Jokowi. SUBSCRIBERS COPY, NOT FOR DISTRIBUTION For subscription: [email protected] 3 New North Sumatra Governor Edy Rahmayadi, who during this year’s election campaign openly supported Prabowo, says he will remain impartial in 2019. Jakarta Governor Anies Baswedan is the only governor likely to openly support Prabowo. He won the governorship in 2017 on Prabowo’s Gerindra Party ticket. The inability of the Democratic Party to stop desertions of key public figures has irked Prabowo’s camp. It did not help that the party now says local leaders can have “two legs” in the elections, supporting the Democratic Party in the legislative election, but campaigning for Jokowi in the presidential race. This ambivalence has been a contentious point that is holding Prabowo back in putting together his campaign team. There is also the question of where to place Agus Harimurti Yudhoyono, the son of the former president who harbors ambitions of running in the 2024 presidential election himself. Then there is also the problem of raising money to bankroll the election campaign, with the four parties in his coalition already struggling to finance their own campaigns. If Jokowi put together his team before searching for its leader, Prabowo has taken the opposite approach. He already has a leader in former Indonesian Army (TNI) commander Djoko Santoso. As in his 2014 campaign team, it is likely that the team will be filled with military types. Those who have worked with Prabowo say only those with a military background can handle the temperamental candidate. Prabowo has been trying hard to recruit another former TNI commander in Gatot Nurmantyo, who also harbors presidential ambitions. Gatot has not publicly announced which way he is leaning. Backing the winning team could earn him a cabinet post that he could use as a springboard for a 2024 presidential bid. Backing the wrong horse would kill his political aspirations. Team Jokowi also has some military types although they are less prominent. Former TNI commander Moeldoko, who was Gatot’s predecessor, is the presidential chief of staff and deputy to Erick Thohir in the campaign team. There is also Lodewijk Freidrich Paulus, who like Prabowo served as chief of the Army’s Special Forces and is now secretary-general of Golkar. And there is former Indonesian Navy chief Marsetyo. The presence of party bigwigs in Team Jokowi, however, is no guarantee that they will dedicate much time to the presidential election campaign. All the political parties will be competing for seats in the House of Representatives and the regional legislative councils. They may be part of the same coalition in the presidential race, but they are rivals in the legislative elections. Golkar, for one, is under a lot of pressure with predictions that it would be demoted out of the top two parties for the first time in its history. In the 2014 elections, it lost its perch to the Indonesian Democratic Party of Struggle (PDI-P) to come second. All surveys show that Gerindra will come second after the PDI-P in 2019. The presence of party leaders in Team Jokowi will likely be token as they will focus more on the fortunes of their parties. But they will be quick to claim credit and their share of the spoils if Jokowi wins the election, demanding key posts in government. SUBSCRIBERS COPY, NOT FOR DISTRIBUTION For subscription: [email protected] 4 Much of the hard work in canvassing votes instead will come from volunteers. These are mostly young people, including college students, who make effective foot soldiers working at the grassroots. Since these voluntary groups are not part of the official campaign teams, their finances are not subject to reporting and auditing requirements stipulated by law. In the 2014 race, Jokowi had these young volunteers to thank for. His official team sat back as their candidate had such an unbeatable lead. But relentless campaigning by Prabowo dramatically cut Jokowi’s lead and he almost clinched the presidency. Jokowi won the race by a five percent margin. Going into the 2019 race, Jokowi is not going to make the same mistake. He has already put in place his dream team and much more. What we’ve heard: It is reported that Erick Thohir’s appointment as the chair of the Jokowi-Ma’ruf campaign team was proposed by several figures, one of whom was Vice President Jusuf Kalla. Erick is deemed the most apposite figure to fill the position not only because of his tremendous networks and logistical skills, but also his capability to outsmart Sandiaga’s maneuvers. As the Jokowi-Ma’ruf camp perceive Sandiaga as Prabowo’s trump card, appointing a figure with the competence to outmaneuver Sandiaga was a must. SUBSCRIBERS COPY, NOT FOR DISTRIBUTION For subscription: [email protected] 5 Advisory Board Name Status Megawati Soekarnoputri Chair of the Indonesian Democratic Party of Struggle (PDI-P) Airlangga Hartarto Chair of Golkar Muhaimin Iskandar Chair of the Nation Awakening Party (PKB) Surya Paloh Chair of the National Democratic Party (NasDem) M.