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141 8 INDONESIA’S QUIET SPRINGTIME: KNOWLEDGE, POLICY AND REFORM Scott Guggenheim Indo­ nesia’s recent emergence as a middle-income country carries with it significant implications for its overall development strategy and the role that knowledge and education play within it. Indo­ nesia is increasingly operating in a highly competitive global economy, one that values not just the country’s traditional economic strengths in natural resource extraction and low-cost labour, but also the ability to innovate and create economic value through knowledge. Development aid as a share of the national budget will continue to shrink, placing an ever-growing premium on the ability of policy makers to make smart choices about how best to spend national budgetary resources. Moreover, the continuing process of democratization carries with it demands for informed public participation through which public policy can be accessed, understood and debated by a broad range of stakeholders. Where will the knowledge about policy options and their trade-offs come from? For a variety of reasons that will be discussed later, during the post-colonial and New Order years Indo­ nesia did not develop the kind of domestic knowledge infrastructure that can currently be seen in other large developing countries such as China, India, Mexico or Brazil. Instead, it has always relied heavily on international technical assistance to help develop policy options that could be presented to high-level * Special thanks are due to Kamala Chandrakirana, Benjamin Davis, Merry Ginting, Jessica Mackenzie, Debbie Muirhead, Patrick Barron, Diastika Rahiwidiarti , Idauli Tamarin and Beth Thomson. I am grateful to P.D. Hien for supplying data for two of the figures. This chapter draws on the design document for ‘Revitalizing Indo­ nesia’s knowledge sector’ (AusAID 2011). 142   Indonesia Rising: The Repositioning of Asia’s Third Giant government decision makers. Nor has Indo­ nesia made much progress in providing an incentive framework for the private sector, universities or civil society to provide these services. However, with the country’s growing wealth, the transition to democracy and associated rise in the importance of public policy debate, and the increasing complexity of policy choices facing the government at both the national and subnational levels of its operation, this strategy is no longer viable. This contribution to the book will argue that after the long winter of New Order control of the institutions of independent thinking, there are signs that new shoots are pushing their way to the surface. Their survival is by no means guaranteed, however. The genius of the New Order’s control system lay not in the instances of outright oppression of critical scholars, analysts and researchers, but in the use of bureaucratic incentives to undermine the production of knowledge from within the very institutions that created and used it. Young scholars, analysts and progressive policy makers today must find new ways to push past this legacy and the many people who have a vested interest in preventing the structural reforms that are needed to change the system. The chapter, then, is an attempt both to describe the current state of Indo­ nesia’s knowledge sector and to develop a preliminary framework to understand what reforms are needed to improve it. Here, the ‘knowledge sector’ means the overall institutional landscape of government, private sector and civil society organizations that support the development of public policy. It includes think tanks, university institutes, specialized agencies within government ministries, certain types of private sector contractors and a range of non-government organizations. In using the term, the objective is not to nail down with full precision the boundaries of the sector, but to focus attention on the overall landscape and the issues that reviewing it from a systems perspective can provide. To the extent that using the term offers up new ideas and approaches that can help Indo­ nesia think through an agenda for reform, it is a useful way to frame a critical development challenge. While the term is meant to be used flexibly, it nevertheless builds on two important foundational concepts. First, treating knowledge as a sector carries with it certain implications about what analytical issues deserve priority. Past approaches to knowledge development in Indo­ nesia have for the most part consisted of efforts to build up individual institutes by providing them with direct assistance through grants, scholarships, twinning programs and other forms of direct support. By contrast, sectoral approaches move the overall structure of regulation, opportunities and constraints to the foreground. The problems of individual organizations’ strengths, weaknesses, leader­ ship, financing...


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