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Indonesia Defence and Security Report Q4 2009

Published by: Business Monitor International

Published: Oct. 3, 2009 - 58 Pages


Table of Contents


Executive Summary
SWOT Analysis
Indonesia Security SWOT
Indonesia Defence Industry SWOT
Indonesia Political SWOT
Indonesia Economic SWOT
Indonesia Business Environment SWOT
Political Overview
Security Risk Analysis
BMI’s Security Ratings
Table: Asia Pacific Regional Security Ratings
Table: Asia Pacific State Vulnerability To Terrorism Index
Indonesia’s Security Risks
Terrorism Risk
Conflict Risk
Physical Safety Risk
City Terrorism Rating
Table: BMI’s Asia City Terrorism Index
South East Asia Regional Security
Security Overview
Internal Security Situation
Table: Indonesia’s Insurgent Groups
External Security Situation
Latest Developments
Armed Forces And Government Spending
Armed Forces
Defence Budget
Army
Navy
Air Force
Table: Regional Armed Forces, 2007 (including conscripted, ‘000)
International Deployments
Weapons Of Mass Destruction
Market Overview
Industry Trends And Developments
Competitive Landscape
Table: Key Players In Indonesia Defence Sector
Arms Trade Overview
Procurement Trends And Developments
Industry Forecast Scenario
Government Expenditure On Defence Industry
Table: Indonesia’s Armed Forces, 2004-2012 (’000 personnel)
Table: Indonesia’s Total Government Defence Expenditure, 2005-2013
Key Risks To BMI’s Forecast Scenario
Macroeconomic Forecast
Indonesia - Economic Activity, 2006-2013
Company Profiles
PT Dirgantara Indonesia
PT Pindad
PT PAL
Country Snapshot: Indonesia Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2000-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators, 2001-2006
Table: Consumer Expenditure, 2000-2010 (US$)
Table: Average Annual Manufacturing Wages, 2000-2012 (IDR)
BMI Methodology
How We Generate Our Industry Forecasts
Defence Industry
City Terrorism Rating
Table: Methodology
Sources

Abstract

Indonesia’s security forces scored a major victory in September by killing fugitive Islamist militantNoordin Mohammad Top in a shoot-out in Central Java. The authorities stated that DNA tests hadconfirmed Top’s identity. The tests were necessary because following a similar shoot-out in August, aman initially thought to be Top turned out not to be.

Top was one of South East Asia’s most wanted men due to his role in masterminding terror attacks inIndonesia, including Bali and Jakarta, over the past decade. Although born in Malaysia, he was mostactive in Indonesia under the regional militant group Jemaah Islamiah (JI), but later broke with JI to setup his own group. His elusiveness had been a thorn in the side of the Indonesian security forces, whoseeffectiveness was questioned after bomb attacks against major hotels in Jakarta in July. As such, Top’sdeath should reduce the immediate security risk ahead of US President Barack Obama’s planned visit inNovember.

Nevertheless, Top’s death does not mean that Indonesia can lower its guard. Local police are said to beconcerned about knee-jerk retaliation by Top’s associates and it is quite likely that Top’s knowledge andexperience of planning terror attacks have been passed on to his followers, who are still at large.

More broadly, there are several structural reasons for Indonesia’s continuing vulnerability to terrorattacks. First, there is the country’s sheer geographical size, with thousands of remote and sparselypopulated islands where terrorists can train. Second, despite modest economic growth in recent years, tensof millions of people remain in deep poverty and are unemployed or underemployed, meaning that thereis a sizeable pool of potential recruits for militant groups.

Third, terror groups have shown great determination to target Westerners in Indonesia. Fourth, despite thedecline in support for hard-line Islamic parties in recent years, there have been signs of increasingintolerance, mainly in socio-cultural matters (e.g. the adoption of shari’a law in some localities). Thesefactors mean that the security forces will need to remain vigilant going forward.

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