M. Chatib Basri

• PhD
• University of Indonesia

The impossible trinity suggests that an economy cannot simultaneously achieve a fixed exchange rate, high capital mobility, and independent monetary policy without abandoning one of these. However, This paper looks at Indonesia’s experiences from the 2009 QE and the 2013 taper tantrum, considering why Indonesian policy-makers were unable to use pol...

We compare two approaches to increasing tax revenue: tax administration and tax rates. We show that when Indonesia moved top regional firms into “medium taxpayer offices,” with high staff-to-taxpayer ratios, tax revenue more than doubled. Examining nonlinear changes to corporate income tax rates, we estimate an elasticity of taxable income of 0.579...

This paper investigates the effects on and responses of five middle‐income Southeast Asian economies to the current global environment of authoritarian populism, the retreat from economic liberalism, and the appeal of anti‐globalization movements. While the political histories and institutional capabilities of the five – Indonesia, Malaysia, Philip...

After three decades of rapid economic growth during the authoritarian Soeharto era, followed by the deep but relatively short‐lived Asian financial crisis, Indonesia transitioned rapidly to democratic and decentralized governance. We examine policy‐making processes and economic outcomes during the first two decades of this new era, leading up to th...

History shows that trade and industrialization were the keys to economic development in East Asia and Southeast Asia. But situations change. The current rise in economic nationalism leads one to ask: Can Southeast Asian nations, including Indonesia, still use the old recipe of open trade and industrialization? Does economic cooperation still have a...

Reform in an Imperfect World: the Case of Indonesia The word ‘reform’ has become a mantra to solve many economic problems in developing countries. Nevertheless, few reforms are successful. When economists are asked why, they usually blame ‘politics’ or ‘institutional failure’. But many reforms fail because international best practices generally do...

In May 2013, the US Federal Reserve began to talk about the possibility of ending its program of quantitative easing. This tapering talk had a significant impact on five main emerging-market countries—Brazil, India, Indonesia, South Africa, and Turkey (the ‘Fragile Five’)—whose exchange rates weakened dramatically and whose stock and bond markets w...

In the last four decades, Indonesia's economy demonstrated remarkable progress. After the devastating currency crises in 1998-99, growth recovered. With the help of commodity prices, Indonesia has become one of the largest middle-income countries in the world. All of this happened amidst the backdrop of delicate political transformations. It is far...

Sound macroeconomic and financial fundamentals, plus quick and forceful fiscal policy responses contributed to Thailand's and Indonesia's economic recovery in the aftermath of the global financial crisis. This paper reviews the impacts of the recent global financial crisis on the Thai and Indonesian economies, and identifies the characteristics of...

We explore the ups and downs of trade protectionism in Indonesia since the Asian financial crisis of 1997–98. The key constraints to unilateral trade reform include exchange rate factors, the political economy of consumer–producer behaviour, institutional complexity and global pressures. We conclude that trade reform is likely to face difficulties,...

This paper provides an analytical narrative of Indonesian economic growth over the past two decades. Particular attention is paid to the key economic crisis events of 1997–1998 and 2008–2009, and how and why Indonesia's response to them was completely different. We emphasize and illustrate how the years 1997–1998 were a watershed in the country's e...

Indonesia has been affected less severely by the global crisis than neighbouring countries. Although Indonesian exports have been hit hard by the collapse of commodity prices and falling demand for manufacturing products, GDP growth has remained surprisingly buoyant. We argue that the strength of domestic demand has been an important driver of grow...

:The global economic crisis has caused economic collapse in many countries. Indonesia is obviously affected by this crisis, its export growth declined significantly. Nevertheless, the impact of the crisis on the Indonesian economy is relatively limited compared to other countries in the region, including Singapore, Malaysia and Thailand. This situa...

While the global financial crisis (GFC) deepens with no clear signs of abatement, it is almost impossible to assess its full impacts on any economies, including that of Indonesia. Nonetheless, it is important to take stock of the impacts of the GFC on Indonesia and to assess the implementation and the progress of ongoing policy responses. In partic...

This paper examines the 2007 WTO review of Indonesian trade policy. Indonesia undertook a major policy liberalisation in the late 1960s. Serious protectionist pressures emerged in the 1970s but for most of this period, and especially since the mid-1980s, the economy has remained broadly open. We summarise the WTO report, update some of its analysis...

The growth of Indonesia's GDP accelerated in the second quarter of 2006, thanks to the buoyant performance of the communications, construction, transport and agriculture sectors. From the demand perspective, growth was supported by increased government spending and net exports. Macroecononmic stability has continued to improve, and Jakarta's stock...

This paper focuses on Indonesia's trade policies after the economic crisis. It examines the trend towards protection and addresses the issues of competitiveness. The concluding part briefly discusses Indonesia's policies on and involvement in free trade agreements (FTAs), which have recently proliferated in the Asia Pacific region.

This book examines Indonesia's business environment since reformasi began in 1985 -- what stayed the same, what changed, and would could change. Economic recovery has been hesitant. Regime change and political reform have created uncertainties that have deepened reluctance to invest. A raft of government-instigated changes have left their imprint:...

Indonesia since the late 1960s constitutes an excellent case study in the political economy of trade protection. There have been major changes in the overall policy regime, from liberalism to significant intervention, and back towards liberalism. There have been large, though declining, inter-industry variations in effective protection. There has b...

This study attempts to elucidate the determinants of trade protection over time together with the inter-industry variations of protection in the Indonesian manufacturing sector. This study draws on the political economy of protection literature which has so far only focused on the developed countries, and has included some modifications to portray...

The period of this Survey, from early October 1997 to early February 1998, was marked by a deepening financial crisis that began as a seemingly simple currency problem and was progressively aggravated by the extraordinary depreciation of the rupiah. On 22 January 1998 the currency fell to a record low of about Rp 17 000/$. This amounted to a devalu...

There are significant inter-industry variations in protection in all but the most open of economies. This invites the obvious question, why? Are these variations simply random in nature, or are they systematic, and therefore amenable to explanation? Most of the literature on this subject pertains to industrialized economies. Few studies have been u...

Indonesia is a country very much dependent on rice. It has consistently been a rice net importer for a long time, except for a brief intermittent of self-sufficiency in late 1980s. Yet, resistance to importation is always strongly pronounced. As a result, government policy tends to bias against the majority net consumers of rice, a group dominated...