The global economy is entering a period of heightened uncertainty and volatility, driven by deepening geopolitical divisions, tightening regulations, and structural shifts in productivity. In this challenging environment, competitiveness has become a strategic priority for both countries and firms.

Indonesia, Australia, and India—three influential middle powers in the Indo-Pacific—are increasingly drawn together by shared interests amid shifting regional dynamics, declining confidence in US leadership, and concerns over China’s assertiveness.

Indonesia’s accession to the OECD is projected to deliver substantial economic benefits, including increased GDP growth, stronger investment inflows—estimated at USD 87.7 billion in 2028—and improved investor confidence through alignment with international standards.

As Indonesia's two most important economic and technological partners, the United States and China’s growing competition threatens to disrupt Indonesia’s trade, investment flows, market access, and cybersecurity landscape.

Indonesia’s green industrial policy—centered on domestic processing of critical minerals and development of an electric vehicle (EV) industry—has positioned the country as a global leader in nickel production and a key player in EV supply chains.

Indonesia’s food estate program—initiated in 1995 and continued under successive administrations—aims to enhance national food security through large-scale agricultural expansion.

Indonesia entered the second quarter of 2025 with signs of macroeconomic stabilization, including cooled inflation at 1.60% and a narrowed current account deficit of 0.1% of GDP.

The Office of the US Trade Representative (USTR) assessed QRIS as a trade barrier in its the National Trade Estimate Report 2025. The report – which includes broader trade concerns – underpins the Trump administration’s plan to impose 32% tariff duty for Indonesian products as of July 2025.

Indonesia must leverage Australia’s ongoing interest in Southeast Asia to shape a practical agenda for security and economic collaboration while clarifying its own strategic priorities, ensuring that the partnership is driven by shared regional goals rather than short-term domestic concerns.