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INSIGHTS / THE BIG PICTURE

What Indonesia’s election could mean for startups and investors

Indonesia · Feb 13, 2019 · By Putu Agung Wija Putera

Industry players voice their hopes, concerns and expectations as the April presidential election nears

After their first face-off in 2014, the Indonesian president and incumbent Joko “Jokowi” Widodo and former general Prabowo Subianto will be going up against each other again this April. 

Voters will need to choose between Jokowi, the first leader elected without ties to the country’s military and political elite, and who has campaigned aggressively on his economic achievements, notably the hefty spending on once-neglected infrastructure projects; and Prabowo, who has promised a return to strongman politics and brought onboard a young former investor-entrepreneur as his running mate. 

In the five years since the candidates last matched up, local startups like Go-Jek, Tokopedia, Traveloka and Bukalapak have grown from apps providing basic services to high-profile unicorns. The once-burgeoning startup scene has exploded on the back of Indonesia’s fast-growing middle-class market – the largest in Southeast Asia – spawning a new generation of entrepreneurs and attracting US$3 billion in funding in 2017.

But as election day draws near, Indonesia may see a slowdown in startup investment, reflecting the uncertainty due to the prospect of a change in government. 

“Investors are waiting for the election to play out,” Samir Chaibi, Investment & Portfolio Head for GREE Ventures in Indonesia, told CompassList. 

“There might be some changes in the current public initiatives that the current government has supported. We've seen it in Malaysia recently,” he said. 

Edited by Leonard Lee

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