00074918.2010.522498

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Bulletin of Indonesian Economic Studies

ISSN: 0007-4918 (Print) 1472-7234 (Online) Journal homepage: http://www.tandfonline.com/loi/cbie20

In this issue

Ross H. McLeod

To cite this article: Ross H. McLeod (2010) In this issue, Bulletin of Indonesian Economic Studies, 46:3, 277-278, DOI: 10.1080/00074918.2010.522498

To link to this article: http://dx.doi.org/10.1080/00074918.2010.522498

Published online: 23 Nov 2010.

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Bulletin of Indonesian Economic Studies, Vol. 46, No. 3, 2010: 277–8

IN THIS ISSUE

Notes from the editor

In our new ‘Survey of recent developments’, Thee Kian Wie and Siwage Dharma Negara argue that little has happened to dispel concern that Indonesia’s reform momentum is dissipating, and they predict that new National Economic and Innovation Committees intended to help accelerate development will probably achieve little. It appears that economic growth has stabilised rather than

continu-ing to accelerate, not least because iscal policy is no longer providcontinu-ing a stimulus.

Manufacturing has been in the doldrums, partly because of the ‘Dutch disease’ effect of surging export commodity prices and volumes, but its recent growth

seems more promising. Soeharto-era attachment to small budget deicits remains

evident in the 2011 budget, which persists in emphasising heavy spending on subsidies at the expense of investment in sorely needed infrastructure.

The authors focus on the incompatibility of the monetary and exchange rate

policies of the central bank, noting that it has responded to the dificulties this causes by allowing some appreciation of the rupiah, an acceleration of inlation and a small increase in the interest rate on its certiicates of deposit, and by forcing

banks to place more funds with it at low or zero interest. It has belatedly begun

to tighten monetary policy to curb rising inlation, but this is likely to increase capital inlow. Oficial indicators suggest that the banking sector is in good condi

-tion. High interest margins relect ineficiency, but this seems mainly to be attrib

-utable to the government-owned banks. Indonesia continues to have dificulty

competing for foreign investment with comparator countries, and much remains to be done to improve the business environment. The government appears to

be considering more serious approaches to tackling Jakarta’s trafic congestion, although conlicting signals on this have emerged. Solutions are seen in expan -sion of the transport infrastructure and improvement of its management, and in the introduction of electronic tolling on main roads.

This year’s discussion of recent political events is based on Dirk Tomsa’s Indo-nesia Update conference presentation at the Australian National University in September. In the author’s view, the fact that the 2009 election failed to generate any new momentum for reform does not augur well for the remainder of Presi-dent Yudhoyono’s second term. Although the basic parameters of democracy

remain intact, political developments during 2010 have conirmed a pattern of

stagnation that is likely to see Indonesia barely muddle through as a reasonably stable yet low-quality democracy.

Banks traditionally dominated Indonesia’s inancial system, and until the 1990s the stock market remained of minor signiicance, making little contribution

to Indonesia’s development until a series of reform and deregulation measures were implemented from December 1987. The paper by James Kung, Andrew Carverhill and Ross McLeod examines the evolving role of the stock market, and

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278 In this issue: notes from the editor

analyses changes in its eficiency over time. The authors show that stock mar -ket activity grew markedly in importance relative to banking after the reforms began to take effect, gaining the ascendancy in 2004 and moving well ahead sub-sequently. They provide evidence that the stock exchange secondary market has

become signiicantly more eficient over time, thus contributing to this success. Soeharto-era concern about corruption was delected by the establishment

of toothless anti-corruption committees, and by suppression of anti-corruption activism and media comment. Budi Setiyono and Ross McLeod describe how activists began to publicise their concerns more openly following Soeharto’s demise. The sporadic activism of the Soeharto years was consolidated through cooperative action among similarly motivated informal groups, and later through the establishment of formal civil society organisations (CSOs). These have played a key role in pushing for new laws and institutions to help eradicate corruption,

but although many corrupt oficials have been imprisoned, the authors ind little evidence that corruption has declined signiicantly. They argue that further pro -gress depends on CSOs gaining a better understanding of the underlying causes of corruption, and that these are to be found in defective public sector personnel management practices.

Terry Hull’s note provides a critical perspective on the preliminary results of the 2010 population census. It explores the concepts of population used and the adjustments made to increase the accuracy of census estimates. The assumptions underlying various population projections in the last decade produced estimates

for mid-2010 that were substantially below the igure of over 237 million persons counted in May. It is argued that, far from relecting a ‘population explosion’,

this is due to the achievement in the 2010 census of greatly increased coverage of people residing in Indonesia.

Eric Ramstetter and Anwar Nasution, close friends and colleagues of the late William E. (Ted) James, a former BIES International Advisory Board member who died last May, have contributed a moving obituary in recognition of Ted’s contributions to the intellectual community that studies Southeast Asian econo-mies in general and Indonesia in particular.

Our regular set of abstracts of recently completed PhD dissertations on

Indo-nesia includes studies of micro-inance in Central Java; the late 1990s banking cri

-sis and subsequent restructuring; the failure of two government-controlled mango supply chains in West and East Java; and new post-Soeharto institutional arrange -ments and economic policy reform. The book review section covers works on

vil-lage blacksmithing in Java; the challenges of implementing decentralisation and regional autonomy; the rural investment climate and rural non-farm enterprises; the state and society in Indonesia; the late 1990s banking crisis and its impact 10 years later; an evaluation of the Asia Paciic Economic Cooperation forum over its irst 20 years; industrialisation strategies in developing Southeast Asia; and

the complex impact of development on the environment in tropical Australia and Southeast Asia.

Selamat membaca!

Ross H. McLeod