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From Reformasi to Institutional Transformation: A Strategic Assessment of Indonesia’s Prospects for Growth, Equity, and Democratic Governance

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Rates of economic growth in Indonesia have returned to the levels experienced before the global economic crisis of 2007-08. And yet other countries in Asia, such as China, India, Thailand, Malaysia, and The Philippines have been growing even faster. Compared to these countries, Indonesia is quickly being left behind in terms of foreign direct investment, manufacturing growth, infrastructure investments, and educational attainment. Like a marathoner carrying a twenty kilogram pack, Indonesia can see the competition pulling away but is powerless to pick up the pace. Indonesia must engage in a thorough process of institutional transformation if it is to shed the legacy of Guided Democracy and the New Order and learn to compete in an ever globalizing economy.

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