Republic of Indonesia

Republik Indonesia
Republic of Indonesia

Motto
Bhinneka Tunggal Ika
Unity in Diversity

Anthem
Indonesia Raya

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Annexed:
Timor Timur (1976-1999)

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Capital

Jakarta

Government

Presidential republic

President

- From 2004

Susilo Bambang Yudhoyono

Legislature

People's Representative Council

History

- December 27, 1949

Independence

- August 17, 1950

Federalism abolished

- May 1, 1963

West Papua integrated

Area

1,919,440 km²

Population

- 2009

238,000,000

Density

123.9/km²

GDP

2009 (PPP)

- Total

US$ 1,042.2 billion

- Per capita

US$ 4,379

Currency

Rupiah

Indonesia

East Indonesia

West New Guinea

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The Republic of Indonesia is a presidential republic in Asia.

Background

The Dutch began to colonize Indonesia in the early 17th century; Japan occupied the islands from 1942 to 1945. Indonesia declared its independence after Japan's surrender, but it required four years of intermittent negotiations, recurring hostilities, and UN mediation before the Netherlands agreed to transfer sovereignty in 1949. Free and fair legislative elections took place in 1999 after decades of repressive rule. Indonesia is now the world's third most populous democracy, the world's largest archipelagic state, and home to the world's largest Muslim population. Current issues include: alleviating poverty, improving education, preventing terrorism, consolidating democracy after four decades of authoritarianism, implementing economic and financial reforms, stemming corruption, holding the military and police accountable for human rights violations, addressing climate change, and controlling infectious diseases, particularly those of global and regional importance. In 2005, Indonesia reached a historic peace agreement with armed separatists in Aceh, which led to democratic elections in Aceh in December 2006. Indonesia continues to face low intensity armed resistance by the separatist Free Papua Movement.^[1]

Economy

Indonesia, a vast polyglot nation, has weathered the global financial crisis relatively smoothly because of its heavy reliance on domestic consumption as the driver of economic growth. Increasing investment by both local and foreign investors is also supporting solid growth. Although the economy slowed to 4.5% growth in 2009 from the 6%-plus growth rate recorded in 2007 and 2008, by 2010 growth returned to a 6% rate. During the recession, Indonesia outperformed most of its regional neighbors. The government made economic advances under the first administration of President YUDHOYONO, introducing significant reforms in the financial sector, including tax and customs reforms, the use of Treasury bills, and capital market development and supervision. Indonesia's debt-to-GDP ratio in recent years has declined steadily because of increasingly robust GDP growth and sound fiscal stewardship, leading two of the three leading credit agencies to upgrade credit ratings for Indonesia's sovereign debt to one notch below investment grade. Indonesia still struggles with poverty and unemployment, inadequate infrastructure, corruption, a complex regulatory environment, and unequal resource distribution among regions. YUDHOYONO and his vice president, respected economist BOEDIONO, have maintained broad continuity of economic policy, although the economic reform agenda has been slowed during the first year of their term by corruption scandals and the departure of an internationally respected finance minister. In late 2010, increasing inflation, driven by higher and volatile food prices, posed an increasing challenge to economic policymakers and threatened to push millions of the near-poor below the poverty line. The government in 2011 faces the ongoing challenge of improving Indonesia's infrastructure to remove impediments to growth, while addressing climate change concerns, particularly with regard to conserving Indonesia's forests and peatlands, the focus of a potentially trailblazing $1 billion REDD+ pilot project.^[2]