Capital Flow Watch

The Republic of Indonesia (Indonesian: Republik Indonesia) is a country in Southeast Asia. Indonesia comprises 17,508 islands. With 206 million people, it is the world’s fourth most populous country and the third most populous Asian country. Indonesia is a republic, with an elected legislature and president. The capital and largest city of Indonesia is Jakarta. The country shares land borders with Papua New Guinea, East Timor, and Malaysia. Other neighboring countries include Singapore, Philippines, Australia, and the Indian territory of the Andaman and Nicobar Islands.

The Indonesian archipelago has been an important trade region since at least the seventh century, when the Srivijaya Kingdom traded with China and India. Local rulers gradually adopted Indian cultural, religious and political models from the early centuries CE, and Hindu and Buddhist kingdoms flourished. Indonesian history has been influenced by foreign powers drawn to its natural resources. Muslim traders brought Islam, and European powers fought one another to monopolize trade in the Spice Islands of Maluku during the Age of Discovery. Following three and a half centuries of Dutch colonialism, Indonesia secured its independence after World War II. Indonesia’s history has since been turbulent. It has recently gone through a democratization process.

Across its many islands, Indonesia consists of distinct ethnic, linguistic, and religious groups. Indonesia has developed a shared identity defined by a national language, ethnic diversity, and a history of colonialism including rebellion against it. Indonesia’s national motto, “Bhinneka Tunggal Ika” (“Unity in Diversity” literally, “many, yet one”), articulates the diversity that shapes the country. Despite its large population and densely populated regions, Indonesia has vast areas of wilderness that support the world’s second highest level of biodiversity.

The country has large quantities of fertile farmland and natural resources. Indonesia has the world’s fifteenth largest area, the nineteenth largest nominal GDP and the sixteenth largest by purchasing power parity. Indonesia is a member of the Association of Southeast Asian Nations, the Asia-Pacific Economic Cooperation, G20, Big Emerging Market, and Next Eleven. [Wikipedia: 2009]