2017 Indonesia Study Group
6 December. Marcus Mietzner (ANU), Burhanudin Muhtadi (Indonesian Survey Institute), Rizka Halida (Indonesian Survey Institute). The 2016 Islamist mobilisation and its impact on intolerance among Indonesian Muslims: new survey findings
In a seminar earlier this year, we analysed survey data to show that the 2016 Islamist mobilisation was not caused by a massive increase in conservative attitudes among Muslims, as many observers had suggested. Indeed, intolerant attitudes among Muslims had been declining for years prior to the mobilisation. Instead, we pointed to better organisational entrenchment of the middle class in key positions of the state and economy as the main driver of the mobilisation. But while a rise in intolerant attitudes could not have caused the mobilisation, did the mobilisation in itself have an effect on such attitudes? To find answers on this, LSI ran a survey in August 2017, and we presented the main findings today.
22 November. Jacob Wray (ANU), Mitchell Morrison (Monash University). Presentations from recipients of research travel grants
Private memories, national histories: Indonesia and the Japanese occupation, 1942-1945 by Jacob Wray (ANU)
The Japanese Occupation of the Netherlands East Indies was a period of major consequence for Indonesia and its people. It was a politically transformative time during which the Japanese dismantled the Dutch colonial system and worked to cultivate a distinct Indonesian nationalism. However, these political changes, which made possible the existence of the Indonesian republic, were accompanied by immense hardship for many thousands of Indonesians. Among the most prominent of these hardships were forced labour mobilisation, institutionalised sexual slavery, and large-scale food shortages. Yet in Indonesia today, the Japanese period is not a matter of political consequence. It is neither a feature of the narrative that underpins Indonesian national identity nor a matter of historical injustice for which Indonesians demand appropriate financial and symbolic recompense. By drawing on oral history interviews and archival and other written sources, this thesis suggested three reasons why Indonesians, unlike citizens of many other former occupied territories, have long appeared indifferent to a period of history that remains highly controversial elsewhere in Asia.
The music of the talo balak ensemble of Lampung, Sumatra by Mitchell Morrison (Monash University)
The socio-musical meanings of talo, a form of gong-chime music from East Lampung, differ in part depending on whether performances are presented inside or outside the boundaries of the Melinting adat community with which the music is associated. The primary occasions for talo performance in the villages are ritual ceremonies such as weddings and title-attainment ceremonies that formalise relationships between members of the community. In these settings, talo provides an opportunity for participation in a way that articulates personal relationships, and its items of repertoire signify in dialogue with other aspects of the ceremony and symbolic culture of the community. When performed outside the adat community, talo almost always falls in to the role of the accompaniment to Tari Melinting, a dance which is said by locals to have originated in the 16th century, but which was “upgraded” on the request of the Sukarno government in Jakarta in 1965. Presentational performances of this dance often form the opening to wider-community events to which special guests such as government office holders have been invited. In this public context, Tari Melinting becomes a symbol of place in dialogue with various discourses of authenticity, Indonesia as a "marriage of cultures" (Hellman, 1998), and claims to its status as an asset of the regency (kabupaten) of East Lampung.
13 November. Leila S. Chudori. In conversation with Leila S Chudori
On 13 November, Indonesia Project invited Leila S. Chudori, an Indonesian author and journalist from TEMPO, to talk about her creative process and the socio-political ambience against which she constructed her literary works. In this conversation, the Project also invited Amrih Widodo and Danang Widyoko to comment on, not only Leila’s new book Laut Bercerita (The Sea Speaks His Name, 2017) but also many of her previous works.
In her latest book, The Sea Speaks His Name, she tells a story of the loss felt by the families and friends of disappeared students and political activists during the tumultuous days in 1998 that led to the fall of President Soeharto and his New Order regime in Indonesia. It is a story about those whose chests feel empty inside, and their search for the knowledge of what happened to their loved ones. It is about betrayal and torture by those for whom power is more valuable than other people’s lives.
Amrih Widodo, a Cultural Anthropologist from the ANU, noted three things about Leila’s line of work. First, despite serious theme she undertook, Leila words and writing technique, can speak to the younger generation easily. Second, Leila focus on family ritual. “From the perspective of the anthropology of religion, a ritual is very important in constructing pre-rational conception.” The idea of lost in Leila’s new novel is derived from the ritual Leila’s construct in the story and then suddenly the ritual stop. Third, Leila’s work tries to explain history through its fiction writing. “Writing fiction is a way to escape the restriction of writing history,” Amrih said.
An activist himself in 1998, reading Leila’s new book brought Danang Widyoko personal experience when he was a student in Salatiga, Indonesia. “Most of the pictures and videos about the 1998 usually centralise in how student occupied the parliament building. But Leila’s [novel] show different things, particularly prior the big demonstration in 1998,” Danang assessed. Furthermore, Danang argued that pressure from student movement is essential, together with the fact that Soeharto had lost a lot of backup from the elite. The elite would not have been abandoned the support for Soeharto without such big demonstration from the student movement.
18 October. Ross Tapsell (ANU). Hoax news, black campaigns and Indonesia’s shifting information society
‘Fake news’ has become a buzzword in the contemporary lexicon. In the aftermath of the Jakarta election, there has been significant concern about the so-called rise of ‘hoaxes’ in the Indonesian public sphere. The Jokowi government has implemented a number of initiatives including: an anti-hoax coordinating body based in the presidential palace; a special police unit which traces people who create slanderous fake news; and an ‘anti-hoax’ car-free-day day to raise public awareness of the issue. News sites are creating ‘hoax or not’ tabs on their pages. Indonesia’s press council has verification ticks. Internationally, Facebook has promised to change the way it filters news sources. But are any of these initiatives likely to reduce the amount or flow of disinformation in the lead-up to Indonesia’s 2019 elections?
In this presentation I asked how and why ‘hoax news’ spreads. I argued that Indonesia’s information society is shifting rapidly due to the prevalence of mobile phone and social media usage, occurring concurrently with declining trust in mainstream media. Solutions are found through improving Indonesia’s mainstream media credibility, internet access and digital literacy. The rise of ‘hoax news’ is thus a reflection of longer-term failures in these areas, rather than something that can be fixed immediately or easily. I used empirical (plus some ‘big data’) research from the 2017 Jakarta election campaign, but the findings resonate with worldwide debates around social media ‘echo chambers’, targeted voter algorithms, and disinformation campaigns.
7 September. Jeremy Kingsley (Swinburne University). Indonesia’s silent revolution: the rise of corporate law firms
23 August. Nicholas Morris (University of New South Wales & Tusk Advisory Indonesia). Fixing Indonesia’s infrastructure crisis
Since the toppling of President Suharto in 1998, and subsequent decentralisation, Indonesia has struggled to invest in sufficient infrastructure to support its growing economy. Today, congestion, power outages, sanitation problems and high logistics costs are commonplace. This problem has been recognised for many years, and a variety of institutional solutions have been developed. However, despite these efforts, infrastructure development remains slow. A recent, and promising, initiative is the creation of the Committee for Acceleration of Priority Infrastructure Delivery (KPPIP). This agency is charged with facilitating thirty priority projects, including toll roads, railways, ports, power plants and transmission lines, water and sewerage, refineries and broadband. It is playing an increasingly influential and effective role in enabling the effective implementation and finance of these projects. In this talk, I outlined the process which has led to the creation of KPPIP, and describe its work and achievements. In doing this, I drew on my involvement with KP3EI, Bappenas and KPPIP throughout the period. I explained how the MP3EI Masterplan, and its attempted implementation, preceded the current phase, and how the RPJMN 2015-2019 (Five Year Plan) set the framework for the choice of projects. In doing this I set out the macroeconomic, financial and institutional problems which have dogged infrastructure investment in Indonesia in recent decades. I then explained how President Jokowi has set out a process for infrastructure reform, and how the mandate for KPPIP evolved.
16 August. Budi Aji (University of General Soedirman). Do social health insurance programs secure household welfare? Empirical evidence from Indonesia
The effort to ensure the provision of healthcare to all Indonesians through the national health insurance scheme (BPJS Kesehatan) has become a contentious issue in Indonesia. As reported, BPJS Kesehatan has managed to cover about 172.9 million people or 65% of the total population by early 2017. Several studies found that the health insurance helped increase health care utilization. However, the effectiveness of such insurance on economic security of Indonesian households varies, particularly in terms of financial protection against welfare loss. In this presentation I took a closer look at the effectiveness of different health insurance programs. Using panel data from the Indonesian Family Life Survey, I examined various health insurance programs and discuss their different benefits schemes, enrollment mechanisms, and population targets. Then I explored how they affect household assets differently. I argued that the differences in benefits packages are at the core of the varying effects across insurance schemes. In particular, the more generous the benefit package is, the more pronounced its protective effect on household assets.
Budi Aji has been working as a lecturer and researcher at Health Economic and Policy Group, School of Public Health, Faculty of Health Sciences, Jenderal Soedirman University, Purwokerto, Central Java, Indonesia since 2002. He focuses his research on health economics, health policy, health financing, global health and health equity. Budi Aji is currently a Visiting Fellow at ANU Indonesia Project.
9 August. Rizal Shiddiq (University of Leiden). Does business-group affiliation affect a firm’s performance?
This was a joint seminar with the Arndt-Corden Department of Economics.
Membership in a business-group may affect a firm’s performance, either through bigger market access or through improved production activities. Using a panel data of Indonesian manufacturing industry in 1996 and 2006, the most recent data available for this type of analysis, I find support to this hypothesis, that is, being a member of a business group positively affected firms’ performance. It appears, however, that the business-group membership premium came from providing better access to the market, rather than by having a differential effect on production activities. In particular, being a member of a business group increased the firms’ earnings by 21 percent and labor productivity by 11 percent. Business-group memberships give firms a better access to the markets for imported inputs and highly educated labor, and, to some extent, the export-product market. The effects on firms’ production activities were more ambiguous: relative to the standalone firms, the affiliated firms spent more on wages, less on materials, and generally the same amount of investment. Additionally, in the post-Suharto year of 2006, both affiliated and non affiliated firms tend to perform and operate better than in the Suharto year of 1996, but with no significant effect on market access. Moreover, in post-Suharto year, there is no statistically significant evidence that the benefit of business group membership has changed relative to Suharto year. Overall, this finding provides more evidence to explain why firms in developing economies tend to become members of business group, rather than lone rangers, and the effects of business-group membership seems to persist despite a change in political regime.
2 August. Arianto Patunru (ANU). On the rice fracas in Indonesia
There has been a wide, ongoing coverage in the Indonesian media these past weeks about the hiking rice prices, raids on rice warehouses, and the government's ill attempt to set the prices. Policymakers issue conflicting statements and observers are debating the accuracy of data on rice production. In this seminar I discussed why rice controversy in Indonesia never ceases, why the existing rice trade policy is in fact anti-poor and why farmers protection programs are in general not effective. I started by pointing to the diverging gap between the domestic prices and the world market price and discussing its negative consequences to the poor families in Indonesia (including the poor, landless farm workers). A brief look on the programs intended to help the farmers will follow. In particular, I discussed the less effective programs such as seed subsidy, fertiliser subsidy, and rice subsidy (Raskin/Rastra), and compare them with arguably more effective ones: conditional cash transfers (PKH), financial assistance for healthcare (KIS), and financial assistance for education (KIP). I then discussed some possible explanations as to why, despite its regressive effects, the existing rice policy persists.
26 July. John McCarthy (ANU). Agrarian change, food security and social protection: towards a relational analysis of the Government of poverty in rural Indonesia
A new geography of global poverty has emerged where the majority of the global poor now reside in middle-income countries. Too often the structural transformation in economies has yet to provide solutions for persistent problems of deep poverty, food security and inequality. In response, over the last decade policy interventions have principally focused on developing social protection programs as the main instrument for dealing with poverty and inequality. These interventions are made possible by a deepening and widening of the apparatuses of governmentality as the state has penetrated deeper into the lives of rural populations to offer new technocratic approaches to questions of vulnerability. This paper considers the case of Indonesia where, despite considerable investment, improvements in social indicators among poor households are proving frustratingly slow. To complement predominant technical, quantitative framing of the poverty and food security problem in vulnerable populations, this paper provides a situated, relational view of how poverty is generated and how social protection policies work within the changing countryside in one particular context – that of lowland rice producing Aceh. The paper evaluates how the predominant problem solving approach embedded in poverty policies provides solutions and considers the implications for vulnerable populations.
19 July. Peter McCawley (Asia Development Bank). The ADB in Indonesia: 50-years of development
Indonesia’s decision in 1966 to become a founding member of the Asian Development Bank (ADB) was one of a series of decisions in Jakarta that year which marked a sharp change in Indonesia’s international economic policies. For the next three decades, Indonesia was the largest country borrower from ADB. The Bank, along with other international members of the Inter-Governmental Group on Indonesia (IGGI), and later the Consultative Group on Indonesia (CGI), supported a large international development program in Indonesia. Much of this program focused on activities in agriculture and infrastructure. And then, in 1997, when the Asian financial crisis led to a sharp recession in Indonesia, ADB joined with other international agencies to provide emergency assistance. After the Asian tsunami in December 2004, ADB joined with many other agencies to mount rehabilitation programs in Aceh.
The story of the Bank’s 50-year partnership with Indonesia reflects ADB’s broader approach across Asia. This approach has emphasised three main priorities: banking and financial programs which underpin higher investment; the promotion of development through encouraging good policies; and support for stronger regionalism. Looking ahead, during the next few decades these three priorities are likely to remain key issues for policymakers, both in Indonesia and across the Asian region.
Peter McCawley is a Visiting Fellow in the Indonesia Project, Arndt-Corden Department of Economics, and a former Head of the Indonesia Project (1981-86). He is the principal writer of the recently published history of the Asian Development Bank, Banking on the Future of Asia and the Pacific: 50 Years of the Asian Development Bank.
The book may be downloaded (no charge) here.
Press releases in English and Bahasa Indonesia providing some details of the book are available here.
14 June. Greg Fealy (ANU). Islam in Australian-Indonesian relations: fear, stereotypes and opportunities
Australian-Indonesian relations have often been said to be determined more by differences than commonalities. Perhaps the single greatest difference between the nations is that of religion. In a 2015 survey, which asked Australians to nominate one word to capture their view of Indonesia, the most popular term, by some margin, was ‘religion’. Accompanying Focus Group Discussions identified that by ‘religion’, respondents really meant Islam, and their opinions were overwhelmingly negative. In this seminar, I will explore the role of Islam in the bilateral relationship, particularly focussing on Australian government responses to perceptions of Indonesian Islam within Australia following the 2002 Bali bombing. Over the following decade, Islam came to dominate Australia’s diplomacy with Indonesia, drawing frequent comment from political leaders and with large and sometimes innovative Islamic sector aid programs. I argued that Australian public anxiety and misunderstanding of Indonesian Islam led to a primarily security-driven approach to policy which failed to realise the potential benefits of greater Islamic engagement.
Greg Fealy is an associate professor in the Department of Political and Social Change in the Coral Bell School of Asia Pacific Affairs at ANU. He specialises in Indonesian politics and Islam.
17 May. Armida S Alisjahbana (Padjadjaran University) & Jonah Busch (Center for Global Development). Survey of recent developments. Forestry and climate change: A forgotten or renewed commitment religion, language and piety: the case of Arabic names in Java
This seminar previewed the author's Survey of recent developments, to be published in the August 2017 issue of the Bulletin of Indonesian Economic Studies.
The recent election of Anies Baswedan and Sandiago Uno as Jakarta’s next governor and vice-governor has intensified Indonesia’s political tensions. A new American administration and increasing tension on the Korean Peninsula have added uncertainty to the global policy situation. Indonesia’s first-quarter growth and economic development have shown notable improvements, including an increase in non-oil export growth, robust domestic consumption, moderate inflation, and stable exchange rates. Banking-sector asset quality and gaps in fiscal revenue are two of the most immediate economic concerns. We turned to forestry and climate change, which raised trade-offs between Indonesia’s economic production and environmental protection goals. We examined four storylines that would determine future land use. First, national commitments related to international climate agreements and finance. Second, land-use rights and regulations. Third, palm oil policies, corporate commitments, and interests. Fourth, forest fires, their causes and consequences, and policies to combat them.
15 May. Jonah Busch (Centre for Global Development). Why forests? Why now? The science, economics, and politics of tropical forests and climate change
This is a joint seminar with the Development Policy Centre and the Arndt-Corden Department of Economics.
Tropical forests are an undervalued asset in meeting the greatest global challenges of our time—averting climate change and promoting sustainable development. Despite their importance, tropical forests and their ecosystems are being destroyed at a high and even increasing rate in most forest-rich countries. The good news is that the science, economics, and politics are aligned to support a major international effort to reverse tropical deforestation.
Why Forests? Why Now?, a new book by Frances Seymour and Jonah Busch, synthesizes the latest research on the importance of tropical forests in a way that is accessible to anyone interested in climate change and development and to readers already familiar with the problem of deforestation. It makes the case to decision-makers in rich countries that rewarding developing countries for protecting their forests is urgent, affordable, and achievable.
Jonah Busch is a senior fellow at the Center for Global Development. He is an environmental economist whose research focuses on climate change and tropical deforestation.
10 April. Antje Missbach (Monash University). Acehnese hospitality towards Rohingya refugees: welcoming victims, strangers, brothers, or aid recipients?
In May 2015, the discovery of mass graves on both sides of the Thailand–Malaysia border caused international outcry. The discoveries were made in camps known to be reception points for Rohingya smuggled from Myanmar. As police and international media focused on the graves, smugglers abandoned their Rohingya “cargo” at sea. Between 5,000 and 8,000 Rohingya became stranded on boats in the Andaman Sea. When some of the abandoned passengers managed to steer their vessels towards the coasts of Indonesia, Malaysia and Thailand, authorities initially refused them permission to land. But Malaysia and Indonesia eventually agreed to allow the Rohingya to disembark and offered them sanctuary for up to one year. In Aceh, where the Rohingya were brought on to Indonesian shores, the refugees were met with an unusual degree of hospitality.
This paper examines different explanations for why a group of more than 1,000 Rohingya refugees stranded in Aceh were treated differently from asylum seekers and refugees residing in other parts of Indonesia. Given the overall lack of a legal framework for refugee protection in Indonesia, the actions of non-state actors in Aceh were widely praised. This paper, however, argues that Acehnese motivations were not necessarily as altruistic as they are widely claimed to be. Instead, actors engaged in a subtle instrumentalization of hospitality for non-refugee related purposes. The paper challenges assumptions that the Aceh model serves as an alternative humanitarian response to refugee crises.
3 April. George Quinn (ANU). Java’s culture of local pilgrimage: its place in the study of Indonesian Islam
Since the 1990s there has been a dramatic rise in the number of Muslims making pilgrimage visits to the tombs of saints in Java. Saint veneration and local pilgrimage preserve many "non-standard" devotional practices that were once called abangan. The big jump in pilgrim numbers belies the claim that non-standard Islam is on the run, or has collapsed altogether, in the face of rising orthodoxy/conservatism. This seminar examines some of the challenges Java’s burgeoning pilgrimage culture poses for research into the dynamics of religious change in Indonesia.
George Quinn is an honorary professor in the ANU College of Asia and the Pacific.
27 April. Ian Wilson (Murdoch University) & Marcus Mietzner (ANU). Jakarta gubernatorial elections: outcomes and implications
29 March. Andrew Rosser (University of Melbourne). The political economy of teacher management in Indonesia
Indonesia faces serious challenges in the number, cost, quality, and distribution of teachers. This presentation examined the role of political economy factors in producing these challenges and shaping efforts to resolve them. It argued that the challenges have their origins in the way in which political and bureaucratic elites have for decades used the school system to accumulate resources, distribute patronage, mobilize political support, and exercise political control. This orientation has meant that teacher numbers, quality, and distribution have been managed to maximize flows of rents and votes from schools to the elite, lubricate patronage and political networks, and ensure that elites maintain political control rather than maximize educational performance and equity. The fall of the New Order led to efforts to change this situation, but these have had little impact so far. The presentation concluded by assessing what can be done by proponents of teacher management reform in this context to promote better outcomes.
15 March. Kate Grealy (Griffith University), Peter Bowers (University of Sydney), Michael Leadbetter (University of Sydney). Presentation from the recipients of research travel grants
Islamist militias in Indonesia by Kate Grealy (Griffith University)
Indonesia’s transition to democracy has been accompanied by a decrease in religious freedom. This is demonstrated by an increase in sectarian and inter-religious violence, and by the tolerance of the state for Islamist vigilantes who target religious minorities. My research project looked at failures of the state in addressing religious violence, and showed how Islamist vigilantes are embraced by police elites as ‘partners in security’ in the provision of semi-privatised security, morality policing and ‘informal’ forms of operational support. The project found that the targeting of minority groups is increasingly tolerated because understandings of security are also tied to notions of social order and localised moralities which are becoming increasingly ‘Islamised’. Because the violent and illegal activities of vigilantes are presented as being in ‘defence of Islam’, over time they have acquired some legitimacy as acts of social order policing in support of the Muslim-majority population and the Indonesian state.
The influence of aspirations in decisions to migrate internally by Peter Bowers (The University of Sydney)
In settings as diverse as education, farming, entrepreneurship and insurance, the poor often avoid making investments even when returns are ostensibly quite high (Duflo et al. 2011, Bryan et al. 2015). One possible explanation for such behaviour may be that some poor people have low ‘aspirations’ for the future or a low ‘reference point’ to which they evaluate the opportunities available to them. This could lead to an ‘aspirations-based poverty trap’. We examine evidence for such a trap by looking at a particularly profitable—yet risky—investment choice: Young Indonesians in a rural area choosing whether to migrate to the city upon finishing high school. We estimate the model using unique data from a large-scale field experiment in Indonesia and find limited evidence for such a poverty trap. While our results come with some important caveats—such as in our measurement of aspirations—this suggests that more traditional (rather than psychological) approaches to poverty alleviation may be more effective.
The rise and demise of urbanism in ancient islands of Southeast Asia by Michael Leadbetter (The University of Sydney)
This research combines the implications of Angkor, Balinese and climate research to investigate the settlement forms and trajectories of Ancient Borobudur/Prambanan, Trowulan and compare them with the known pattern in central Bali. By adding in the knowledge of the 1256 eruption, the progressive abandonment of rice growing settlements and cities in the mid 13th century begin to make sense. The dependency of large cities on rice growing food security and trade explains not only their sudden demise but also the collapse of the Srivijayan empire at the same time.
8 March. James Castle (Castle Asia). Indonesia’s political economy: prospects for growth and reform facing a sectarian surge in a fearful world
President Joko Widodo was elected in 2014 on a platform promising economic growth with greatly expanded infrastructure spending and by attacking corruption through more honest and transparent public administration and reducing red tape. Now half way through his five-year term what progress has been made, what are the prospects for the remainder of this term and what are his prospects in 2019?
On the international front, the global appetite for facilitating cross-border trade and investment, the fuel of the Asian miracle, is vanishing. Domestically, the surge in sectarian political activity is threatening Jokowi’s hard-earned control of parliament and given new life to dangerous sentiments that at best have distracted the current leadership from its economic reform agenda.
Meanwhile, despite the president’s best efforts, inward-looking economic policies encouraged by his predecessors and put into law by previous parliaments continue to retard investment and encourage debilitating misallocation of the country’s limited financial and technological resources.
The seminar discussed whether or not this pessimistic view is correct and the implications of these challenges for Indonesia’s near and medium term prospects.
22 February. Marcus Mietzner (ANU) and Edward Aspinall (ANU). The Jakarta elections: national and local perspectives
This seminar discussed the results of the Jakarta gubernatorial elections on 15 February. It considered the dynamics of grassroots campaigning as well as the implications of the results for national politics. Both speakers observed the election campaign, and the political events surrounding it, on the ground.
1 January. Chris Manning (ANU) and Sarah (Xue) Dong (ANU). Survey of recent developments: economic consolidation, ongoing reforms and labour market and change
Politics played a much more important role in national affairs in the wake of two big mass demonstrations in the last two months of 2016 over the blasphemy case brought against the Jakarta Governor. Politics can be expected to take up more of the President’s attention in coming months in response to public criticism, such as responding to wild rumours about Chinese economic expansion that have gone viral in social and print media. Nonetheless, macroeconomic conditions have been stable and the government consolidated its fiscal position over the four months from October, which is good news for growth and for jobs. Thus economic growth, led by consumption and services, has been steady, and respectable by regional and global standards. The budget has been consolidated partly through increased revenue from the tax amnesty reported in the previous survey. As a result of urgently needed cuts in public spending managed by the new Minister of Finance, realised expenditure came in at 10 per cent below the original budget, and very close to the revised budget of mid 2016. Only one new package of reforms (the 14th) on digital business was announced since October, as attention shifted to implementation of the raft of reforms announced over the past 18 months. The government began removal of the electricity and gas subsidies for middle income earners and announced plans to expand tourist hubs in 2017-2018. Stable economic conditions have also underpinned moderate employment growth, greater formalisation of the labour market and a steady fall in unemployment. Low productivity remains a pressing challenge, although the government has taken steps to raise productivity through increased vocational training, skills recognition and development.