Geopolitical shift in East Asia: Mid-term strategy for foreign policy

Purwokerto, 9 July 2012

Dr. Siswo Pramono, LLM Director of the Center of Policy Analysis and Development of Asia-Pacific and Africa Regions Ministry of Foreign Affairs Republic of Indonesia
This presentation is personal opinion

Designing Mid-term strategy

Deepening economic relations with Northern America and Western Europe (higher income per capita region) Broadening economic access to Asia-Pacific and Africa (top growers region) Intermestic management: integrating Indonesia incorporated with higher per capita region and top growers region Improving micro-management and macromanagement of foreign policy (from political economy perspective)

Economic state of affairs: world income per capita

Source: Sindo, BPS, IMF

Geopolitical Shift: East Asia and Africa

New Afro-Asia Axis

Port Ranking & Container Shipping Line Industry

Energy

Geopolitics of East Asia:

Market and Resources ASEAN+3 Trilateral summit/FTA? New Energy Access (SCO, Russ far east, OZ) Food/water Security
Potential Hotspots: Korea Peninsula South China Sea Indian Ocean The Pacific Local Developments: India-Pakistan rapprochement North Korea Myanmar Darwin

Toward new Africa

Source :The Economist, The World in 2012

Towards a new Africa

The way Indonesia should look at Africa

Food Security: Africa has 60% of the worlds total amount of uncultivated, arable land. Investment: Improving business environment and above average economic growth (2012 top 10 GDP growth included 5 African countries). Africas total GDP above US$1.5Trillion Trade: Growing middle class with 52 African cities having more than 1 million people each.
(Source: Mckinsey Global Institute: June 2010, Fadl Naceroedin)

The African renaissance: African renewal: sharp drop in interstate conflict and war. Elections and move towards greater democracy. The African Agenda: African development initiatives (NEPAD, Interregional free trade etc.). Cooperative projects rising e.g infrastructure Pan-Africanism: The vision of African Unity. Resistance to neo-colonialism and outside interference
(source: Fadl Naceroedin, 2012)

How ready is Indonesia ?: Indonesia inc. and west-east infrastructure discrepancy

Total GDP: US$ 700 billions 16th largest economy 23,5% 89,6% 10,4%

9,6% Pull Factor Needed?

Pull Factor Needed?

57,6%

Pull Factor Needed?

Pull Factor Needed?

How ready is Indonesia ?: Indonesia inc. west-east HRD discrepancy

Striving for Traditional and non-traditional market

Total trade in January-May 2010 and 2011

Traditional market

Non-traditional market

Strategy: Economic diplomacy to support economic development

Bilateral Strategic partnership Main economic and trade partners, and main source of capital inflow; Main source of capacity building in the realms of defense, security, good governance, economic institution, education, science and technology; Partners in the cooperation to address global issues

+ Regional market access:

ASEAN (GMS) Trilateral FTA SCO EU NAFTA SADC Mercosur SAARC

Strategy: Bilateral strategic partnership + regional market access

Case study 1: Micro-Management

Percentage of budget of RIs embassies in Africa allocated for main task and function

No

Mission

Total (%)

1 2 3 4 5 6 7 8 9 10

Aljazair/Alger Kenya/Nairobi Madagaskar/Antananarivo Mozambik/Maputo Namibia/Windhoek Nigeria/Abuja Sudan/Khartoum* Tanzania/Dar Es Salaam Tunisia/Tunis Zimbabwe/Harare

100 100 100 100 100 100 100 100 100 100

Economic Diplomacy (%) 70.37 39.05 61.86 73.54 21.45 46.15 44.30 52.04 33.25 43.20

Protection of Citizen (%) 29.63 20.78 15.46 26.46 22.20 5.13 15.66 28.18 16.87 16.76

Information and Culture (%) 13.20 22.68 22.04 35.90 16.72 19.78 37.41 19.66

Politic and Security (%) 26.96 34.31 12.82 23.32 12.47 20.37

Case study 2: Macro-Management Pull-Factor and Political Economy

Dr. Siswo Pramono, LLM

Director of the Center of Policy Analysis and Development for Asia-Pacific and Africa Regions Ministry of Foreign Affairs Republic of Indonesia