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Fuel price hike may increase risk of political turbulence
The government’s recent decision to raise the prices of three brands of motor fuel may increase the risk of political turbulence as the prices of other products follow suit and low-income Indonesians feel sharpened financial strain.
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Motorists line up at a gas station in Jakarta on Sept. 3. The government has announced an increase in the prices of certain fuel brands. (AFP/Bay Ismoyo)
I
t is feared the decision by President Joko "Jokowi" Widodo’s administration to raise fuel prices may trigger political turbulence, with labor groups clamoring over the knock-on effect the unpopular policy will have on low-income Indonesians.
Ahead of and after Saturday's price hike announcement, labor unions and students in several regions, including Jakarta, West Java, Central Java, East Java and South Sulawesi, staged protests in opposition to the increased prices of the subsidized Pertalite gasoline and Solar diesel brands.
A student rally in Central Jakarta on Monday even demanded the energy and finance ministers and president director of state-owned oil and gas company Pertamina be removed from their positions.
Some labor organizations and the Labor Party – which was founded last year by prominent labor union leader Said Iqbal and has registered to field candidates for the 2024 general election – have threatened to hold protests against the price hike nationwide on Tuesday. Those from Greater Jakarta, meanwhile, plan to stage rallies in front of the House of Representatives building in Jakarta on Tuesday morning.
Said Iqbal said the price increases would hit workers disproportionately, particularly factory workers, who had not received salary increases for the past three years. He also feared that mass layoffs would follow as industrial energy prices would increase.
“If the protest on [Tuesday] remains unheeded by the government and lawmakers, the Labor Party and the Confederation of Indonesian Trade Unions [KSPI] will organize a follow-up action,” he said.
Lawmakers from opposition parties – the Prosperous Justice Party (PKS) and the Democratic Party – criticized the higher fuel prices, saying that people were beginning to feel the pinch – even though the government planned to roll out social aid worth Rp 24.17 trillion (US$1.62 billion).
