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Flash Notes Upcoming Jakarta Governor Election

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Ho Woei Chen [email protected] Global Economics & Markets Research Email: [email protected] URL: www.uob.com.sg/research Monday, 13 February 2017 Flash Notes Upcoming Jakarta Governor Election Local elections will be held next Wed (Feb 15) in 101 regions across Indonesia. The most closely-watched is clearly the Jakarta election where 7.2 million registered voters will elect their governor to a five-year term in a three-corner fight. The Jakarta governor job is seen as a stepping stone to higher office since Jokowi was Jakarta governor prior to becoming the president in Nov 2014. Incumbent Jakarta governor Basuki Tjahaja Purnama (Ahok) along with his deputy Djarot Saiful Hidayat will be running for a second term, against Agus Harimurtri Yudhoyono, the son of former president Susilo Bambang Yudhoyono, and Anies Baswedan, former Minister of Education and Culture (2014-2016). Basuki who is under trial for blasphemy has seen his popularity rating bouncing back after the first official gubernatorial debate on Jan 13. The second debate was held on Jan 27 and the final one will be held today (Feb 10). Indonesia enters into the official cooling-off period on Feb 12-14. The verdict on Basuki’s blasphemy trial is expected to be out only after the Jakarta election, probably in March. Various media reports suggest that conviction for blasphemy is highly likely. Conviction comes with jail term of up to five years. In the event of a conviction, his hold to the office will be precarious even if he wins the election on Feb 15. The outcome depends on the sentencing recommendation as office-holders in Indonesia will be suspended if they face charges with a jail sentence of five years or more. In such an event, Mr Djarot Saiful Hidayat, his deputy and running mate will take over. Basuki Tjahaja Purnama Agus Harimurti Yudhoyono Anies Baswedan Candidate Nominee 50 years old 38 years old 47 years old As the deputy governor, Son of former President he succeeded Jokowi as Former Minister of Susilo Bambang Background governor of Jakarta in Nov Education and Culture Yudhoyono, spent 16 years 2014 when Jokowi was (2014-2016) in the military elected president Running Mate Djarot Saiful Hidayat Sylviana Murni Sandiaga Uno Political Party PDI–P Demokrat Gerindra Source: Various newswires Recent Polls Results Survey Date Ahok-Djarot Anies-Sandi Agus-Sylvi Undecided Indikator Politik Indonesia Jan 12-20 38.2% 23.8% 23.6% 14.4% Saiful Mujani Research and Jan 14-22 34.8% 26.4% 22.5% 16.3% Consulting (SMRC) Populi Center survey Jan 14-19 36.7% 28.5% 25.0% 9.8% Source: Various newswires Election Process The Jakarta Gubernatorial Election 2017 is expected to take two rounds which is if none of the candidates secures an absolute majority (>50%). This will see a runoff election between the top two candidates in April. This was also the case in 2012 when Jokowi won the runoff election with 53.82% of votes against Bowo’s 46.18%. Official results are expected to be announced a week after the election but unofficial quick count results which have been proven to be accurate will be out shortly after the poll closes at 2pm SG time on Feb 15. Inauguration will be in Oct 2017. The government has announced 15 Feb as a public holiday in Indonesia and markets will be closed. Flash Notes Monday, 13 February 2017 1 Page Impact On The FX Market USD/IDR has been stable ahead of the gubernatorial elections and is likely to remain driven by broad USD trend. We maintain our call for USD/IDR at 13,800 end-1Q17. Disclaimer: This analysis is based on information available to the public. Although the information contained herein is believed to be reliable, UOB Group makes no representation as to the accuracy or completeness. Also, opinions and predictions contained herein reflect our opinion as of date of the analysis and are subject to change without notice. UOB Group may have positions in, and may effect transactions in, currencies and financial products mentioned herein. Prior to entering into any proposed transaction, without reliance upon UOB Group or its affiliates, the reader should determine, the economic risks and merits, as well as the legal, tax and accounting characterizations and consequences, of the transaction and that the reader is able to assume these risks. This document and its contents are proprietary information and products of UOB Group and may not be reproduced or otherwise. Singapore Company Reg No. 193500026Z.
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