Countering the Digital Silk Road: Indonesia

Vivek Chilukuri and Ruby Scanlon

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The Importance of Indonesia

In the escalating U.S.-China technology competition, there is no region more important than Southeast Asia, and there is no country within it more important than Indonesia.

The reasons are abundant. Indonesia boasts the largest economy—including the largest digital economy—in Southeast Asia. It has plentiful energy and mineral resources—for example, it is the world’s top producer of nickel, an essential component for electric vehicles. Indonesia’s middle class of 52 million is young, growing, and tech-forward, and the country’s 17,000 islands strategically stretch from the Pacific Ocean to the Strait of Malacca, a choke point through which 25 percent of all global trade shipments pass.1 Indonesia is also a relatively stable democracy—and the world’s largest Muslim-majority democracy—with a growing, if uneven, global voice.

Despite increased outreach from Washington and Beijing, Jakarta has long pursued a policy of strategic autonomy paired with active regional leadership through the Association of Southeast Asian Nations (ASEAN). Its foreign policy embraces the principle of bebas dan aktif (“independent and active”) with an approach former President Susilo Bambang Yudhoyono once distilled as having “a million friends and zero enemies.”