Indonesia: The opposition wins general election but cannot avoid a large coalition

Event

According to preliminary results – to be officially announced in May – the opposition Democratic Party of Struggle (PDI-P) has become the first party after the 9 April Parliamentary polls, but with not more than 20% of the vote.

It implies that Jakarta governor Joko Widodo, PDI-P’s frontrunner candidate, would be far from having a majority in Parliament when he is expected to start his mandate after next July’s presidential elections. Widodo has already begun negotiations with a number of parties to form a large coalition.

Golkar, the second party with 15% of the vote, is one of them but its more nationalist and less liberal agenda could be a problem. President Yudhoyono’s Democratic Party only came fourth with 10%.

Impact on country risk

PDI-P’s mixed electoral success looks like a Pyrrhic victory that has nothing to do with Widodo given his high popularity but is most likely due to PDI-P’s limited campaign and belated appointment of Widodo as their presidential candidate. The PDI-P’s rather disappointing result is a blow to those who had expected a government with a strong majority in Parliament for the next five years.

After all, Indonesia needs a new impetus after incumbent Yudhoyono’s second poor and unambitious mandate, notably to improve the investment climate, fight against corruption and develop infrastructure. Mr Widodo appears as the ideal candidate: he is young, perceived as a reformist, pro-poor and non-corrupt and thus would embody the hopes of the world’s fourth largest population.

However, if he ever becomes president in July, probably opposed to tycoon Mr Bakrie (Golkar’s head), he risks being constrained like his predecessor by government coalition games – in addition to Indonesia’s decentralised political system – which should undermine effectiveness of government policy and bold reforms.

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Raphaël Cecchi –