Jokowi's track record supports market hopes
AS THE campaigning in the run-up to Indonesia's parliamentary elections enters its final week, attention is turning to the likely market impact of a big win by the opposition Indonesian Democratic Party - Struggle (PDI-P) led by Jakarta's reformist governor Joko Widodo.
Poised to wrest back the reins of power for the first time in a decade, the PDI-P is expected to tackle the country's woeful infrastructure, unsteady foreign direct investment and endemic corruption.
Construction companies, banking, property and retail sectors are poised to benefit.
Underpinning this outlook is Mr Joko's track record in government dating back to 2005, when the former furniture salesman was elected mayor of Surakata, or Solo.
More lately, as the governor of Jakarta, the man widely known as Jokowi kick-started billions of dollars in public works, including rapid rail and flood management projects. Populist measures such as free health care for some of Jakarta's poor and improvement of the city's slums have also bolstered his can-do image.
Mr Agus Yanuar, president-director of Samuel Asset Management in Jakarta, said: "The market sentiment is very positive on Jokowi. He has the credentials and a track record that people can see."
The PDI-P's pledge last month to nominate Mr Joko as its candidate capped nearly a year of speculation that he would nudge aside party chief and former Indonesian president Megawati Sukarnoputri to become the party's nominee for president.
Said Mr Yanuar: "Jokowi is a person the public sees as 'one of us'."
However, Mr Joko's admitted macroeconomic inexperience and his populist streak have troubled investors.
After taking over as governor in 2012 he opposed Indonesia's fuel price increase last June, and approved labour demands for a 44 per cent minimum wage hike, although he fended off demands for another wage hike last year.
The PDI-P's manifesto published last month, while mostly rhetorical, underscored the party's protectionist bent.
Mr Robert Prior-Wandesforde, the head of Southeast Asia Economics for Credit Suisse, commented in a report late last month: "We believe it would be premature to assume that a Jokowi presidency will usher in a period of business-friendly structural reform."
Credit Suisse said: "We expect the euphoria to continue for a few weeks, after which the market will focus on the real politik and the challenges any incumbent will face."