Wisconsin Public Radio

Manufacturing is still critical to the economy United States. Clyde Prestowitz, says it's time to start realizing the positive spillovers that manufacturing creates... Read more  

Events & Activities

Stephen Olson at Chinese Development Institute Conference


 Clyde Prestowitz giving presentation to CDI...


Steve Olson teaching trade negotiations at the Mekong Institute...


Stephen Olson to speak at upcoming workshop organized by the International Institute for Trade and Development on 

"Economics of GMS Agricultural trade in goods and services towards the world market"

Chiangmai, Thailand Sep 8-12.


Diplomatist: Indonesia Leading the Middle Order

Indonesia Leading the Middle Order

By Steve Olson


If the Indonesian leadership continues to demonstrate deft handling of its
international relations and manages to avoid a major economic recoil, there is an opportunity for it to play a more formidable role on the global stage, according to Stephen Olson.

By virtue of its extremely large domestic market, low labour costs, impressive growth, expanding middle class, and preferential access to ASEAN and China, Indonesia has become a highly significant market in its own right, a logical springboard into China, and a leader amongst it ASEAN brethren

With its steadily increasing economic might and strategic influence, the Southeast Asian island archipelago of Indonesia has moved itself front and centre on the global stage. Indonesia’s hosting of this year’s Asia Pacific Economic Council (APEC) forum was hailed by the leader of at least one Asia Pacific country in attendance for producing the “best APEC” meeting ever. And with Chinese President Xi capitalising effectively on the absence of his American counterpart, the meeting garnered worldwide headlines and attention for the commentary it provided on the US and Chinese competition for influence in the Asia Pacific.

Little more than a month later, Indonesia was once again at the epicentre of global economic diplomacy, as the Ministerial Meeting of the World Trade Organisation (WTO) convened in Bali. After almost a dozen years of futile negotiations to bring the Doha Round of global trade negotiations to a successful conclusion, the Bali negotiations were finally able to salvage a scaled-down package of trade liberalisation measures – the so-called “Bali Package”. While far less ambitious than the originally conceived Doha Round agenda, these measures are nonetheless expected to deliver a considerable boost to the global economy of as much as $1 trillion. Indonesian President Yudhoyono and Trade Minister Gita Wirjawan were both given high marks for their stewardship and their efforts to bring the negotiations to a successful conclusion.

While the hosting of these two major international diplomatic and economic events within such short order was largely coincidental, they do serve to symbolise Indonesia’s growing heft and presence on the international stage. How has Indonesia – a country convulsed by political upheaval and economic crisis less than 15 years ago – managed to carve out such a central role for itself? The answer is – Strong economic growth, a favourable set of global strategic circumstances, competent leadership, and a fair amount of good luck.

Start with the basics: Indonesia is big. With a population of over 250 million, Indonesia is the fourth most populous nation in the world, and the largest economy in the Southeast Asia. Indonesia’s large population provides both an abundant pool of cost-completive labour to help drive exports, as well as a substantial source of local demand.

To read this article in its entirety in the Diplomatist, please click here.

Join our mailing list

Latest Publications

The Betrayal of American Prosperity.

The Trans-Paific Partnership and Japan.

Making the Mexian Miracle.

Industrial Policy and Rebalancing in the US and China.

The Evolving Role of China in International Institutions.


Contact us

Economic Strategy Institute

1730 Rhode Island Avenue, NW, Suite 414 |  Washington DC  |  20036
Ph (202) 213-7051  |  Fax (202) 965-1104  |  info@econstrat.org