Authors: Moch Faisal Karim & Muhammad Kholid (Universitas Islam Internasional Indonesia) | Journal: Journal of Contemporary Asia, Vol. 56, Issue 3, 2026 | DOI: 10.1080/00472336.2025.2529013 | Published online: 30 July 2025
Keywords: Authoritarian neo-liberalism, democratic backsliding, Indonesian political economy, Joko Widodo, Omnibus Law, neo-liberal restructuring
Part of JCA Feature Section: "Oligarchs, Authoritarianism, and Development in Indonesia"
Abstract
"There is considerable academic consensus that Indonesia experienced democratic decline under the presidency of Joko 'Jokowi' Widodo from 2014 to 2024. However, the link between an increasingly authoritarian political tendency and Jokowi's neo-liberal agenda remains under-explored. This article scrutinises the resurgence of authoritarian neo-liberal tendencies over Jokowi's decade in power. Through in-depth interviews with members of parliament, civil society organisations, and labour activists, it is argued that Jokowi's authoritarian neo-liberalism occurred through two processes: first, the recentralisation of regulatory and decision-making authority from local governments to the central government and second, a strengthening of the regulatory authority of the executive branch at the expense of legislative bodies. The article argues that these processes were not the result of the administration's ambition to accumulate political power, but rather form a strategy to further its pursuit of a neo-liberal agenda. Hence, the neo-liberal agenda is at the heart of Jokowi's authoritarian turn. This is illustrated by assessing Jokowi's efforts to ratify the Omnibus Law on Job Creation in 2020."
Background and Context
Since the fall of Suharto's New Order regime in 1998, Indonesia has been studied as one of Asia's most significant democratic transitions. The country of 270 million people conducted competitive multiparty elections, established independent anti-corruption bodies, achieved significant decentralisation of power to regional governments, and experienced notable civil society pluralism. However, by the time Jokowi left office in 2024, a growing body of scholarship had identified significant democratic deterioration — variously described as democratic decline, regression, or "deconsolidation."
Existing explanations for this decline have emphasised several factors: Jokowi's accommodation of the military and police in civilian governance; his use of legal instruments to criminalise political opponents; the weakening of the Corruption Eradication Commission (KPK); the rise of identity politics that Jokowi sought to co-opt; and broad trends of executive aggrandisement. What has remained analytically underdeveloped, the authors argue, is the relationship between Jokowi's authoritarian tendencies and his economic agenda — specifically, the connection between authoritarian political practices and the pursuit of neo-liberal economic restructuring.
Central Argument
The article's core thesis is that Jokowi's authoritarianism was not primarily a power-grab for its own sake, but was rather instrumentally driven by the requirements of implementing a neo-liberal economic agenda. In other words, neo-liberalism itself necessitated the authoritarian turn — to push through deregulation, labour market flexibilisation, removal of environmental protections, and investor-friendly reforms against significant democratic opposition, Jokowi had to undermine the institutional channels through which that opposition operated.
This represents a significant analytical reframing. Where many scholars have treated Jokowi's authoritarianism as a political phenomenon — executive aggrandisement, patronage politics, coalition building — Karim and Kholid argue it should be understood primarily as a political-economic phenomenon: the authoritarian deepening of state capacity to implement neo-liberal restructuring in the face of resistance from decentralised democratic institutions, legislative oversight, and civil society.
Two Mechanisms of Authoritarian Neo-Liberalism
Mechanism 1: Recentralisation of Regulatory and Decision-Making Authority
The first mechanism is the systematic transfer of regulatory and decision-making powers from local governments back to the central government — a reversal of the post-1998 decentralisation process that had been central to Indonesia's democratic reform.
Following the 1998 reformasi, Indonesia implemented one of the world's most ambitious decentralisation programmes, transferring substantial authority over natural resources, land use, licensing, and budgets to over 500 regional governments. The authors document how, under Jokowi, this was systematically reversed. Key licensing powers — particularly for investment and natural resource extraction — were recentralised to national ministries and, ultimately, to the executive branch. This was driven by the need to remove veto points and regulatory friction that local governments (responsive to local communities and environmental concerns) were creating for large-scale investment projects.
Mechanism 2: Strengthening Executive Regulatory Authority at the Expense of the Legislature
The second mechanism is the weakening of legislative oversight over the executive in regulatory matters. Jokowi progressively marginalised parliamentary scrutiny of regulatory change, using Presidential Regulations and Government Regulations to implement significant economic policy changes that would previously have required full legislative deliberation. The legislative branch was increasingly treated as an obstacle to be managed rather than a co-equal partner in governance.
The Omnibus Law Case Study
The article's central empirical illustration is the passage of the Omnibus Law on Job Creation (Undang-Undang Cipta Kerja) in 2020 — a sweeping legislative instrument that simultaneously amended or revoked provisions in dozens of existing laws. The Omnibus Law became internationally notorious for weakening labour protections, reducing environmental impact assessment requirements, and streamlining investment procedures in ways that critics argued systematically disadvantaged workers and local communities.
The authors use this case to demonstrate both mechanisms in operation simultaneously. Legislatively, the Omnibus Law was rushed through parliament with minimal deliberation under significant pressure from the executive — passed in extraordinary session during the COVID-19 pandemic, when public assembly and protest were curtailed by health restrictions. The Constitutional Court later found the law was passed unconstitutionally (in violation of "formal law-making requirements") — yet the government simply re-passed a revised version.
The law recentralised licensing for major investment projects, weakened regional government authority, reduced severance requirements for workers, and streamlined environmental assessment processes. The authors' interview data with parliamentarians, civil society actors, and labour activists corroborates their argument that these changes were experienced as an executive power play designed specifically to remove obstacles to the neo-liberal economic agenda.
Theoretical Contribution
The article situates itself within the literature on authoritarian neo-liberalism — a concept developed in comparative political economy to describe the co-evolution of market liberalisation and authoritarian political practice, where authoritarian governance is used to impose market-oriented policies that face resistance from democratic processes. The authors apply this framework — previously used extensively to analyse Turkey, Hungary, and Latin American cases — to the Indonesian context, arguing that the Indonesian case demonstrates the "return" of an authoritarian neo-liberal tendency that was also present under Suharto's New Order.
Key Findings
- Jokowi's authoritarian tendencies were functionally linked to, and driven by, the requirements of implementing a neo-liberal economic agenda — not simply by personal power ambition.
- Recentralisation of decision-making from regional governments was a deliberate strategy to remove democratic friction from the investment process.
- Weakening legislative oversight was used to bypass democratic resistance to labour market and environmental deregulation.
- The Omnibus Law represents the most comprehensive and visible expression of this authoritarian neo-liberal logic.
- The neo-liberal agenda — not authoritarian consolidation per se — was the primary driver of the political trajectory under Jokowi.
This article summary is prepared by the IOCSS Journal Monitor. The original article is available at tandfonline.com.