T

he complete unstatesmanlike attitude of the losing presidential candidate, Prabowo Subianto, in stubbornly refusing to accept the final election result tallied by the General Elections Commission (KPU) earlier this week, will unnecessarily defer the momentum of a new wave of market bullishness about Indonesia'€™s economic outlook.

The period of uncertainty and the inevitably tense situation until the Constitutional Court makes a decision later next month to resolve Prabowo'€™s election result challenge, will slow things down for the new government in preparing a smooth takeover.

We believe Prabowo'€™s refusal to concede defeat will not hinder the outgoing government from inviting president-elect Joko '€œJokowi'€ Widodo'€™s economic team from joining the final preparations for the draft 2015 state budget.

Even though this budget plan will be proposed by outgoing President Susilo Bambang Yudhoyono to the House of Representatives on Aug. 16, its implementation, beginning in January, will be the full responsibility of the Jokowi government that will take over on Oct. 20.

The format and structure of the 2015 budget will be the first market test of Jokowi'€™s economic management because a budgetary system is a communication mechanism, conveying signals about spending behavior, prices, priorities, intentions and commitments.

The fiscal policy will serve as the first guidepost for the market on how the new government'€™s macroeconomic management will take shape. Again, fiscal management will be the biggest challenge due to severely limited budget resources, as almost 85 percent of revenue will go to covering fixed-cost expenditure, such as personnel, debt servicing, energy subsidies and transfers to regional administrations.

The budget system must be built to cope with these realities, self-inflicted uncertainties or rigidities.

What will make the fiscal challenges even more complex is that the new government will have to deal with a '€œtoxic'€ coalition of opposition political parties that still control more than 52 seats at the House.

Unless some opposition parties eventually join the Jokowi coalition, the House could become a '€œkilling ground'€ for any policies the Jokowi administration proposes.

The national state budget is required to be passed into law before the end of October so that regional administrations have about two months to prepare their respective budgets.

The next immediate challenge for Jokowi is negotiating the new regional minimum wage, which should also be completed in the last quarter of the year.

In recent years, annual minimum wage negotiations have more often been marred by labor strikes and even violent street demonstrations. This sensitive issue could be exploited by bad loser Prabowo and his supporters to create instability and make things murkier for the new government.

So all in all, there is nothing in the way of a honeymoon for the Jokowi government. There are uphill tasks and turbulence ahead before the new government reaches its '€œcruising'€ altitude.