Has Indonesia turned a corner?

Indonesia has come a long way since the Asian crisis of 1997-98, but for the most part of this last decade it has been a story of underperformance. With appropriate macroeconomic policies and further reforms, however, a pick-up in investment could allow the Indonesian economy to grow at annual rates of 8% or more within a few years. At the bare minimum, Indonesia should be able to sustain its current growth rate of 6% over the next two years, despite the US-led global slowdown and the twin inflation threats from food and fuel prices.