Indonesia’s US$1 billion bet on the Global South

BY ANY measure, Indonesia’s decision this week to deposit US$1 billion into the New Development Bank (NDB) marks more than just another line item in the state budget. It signals a geostrategic pivot – a deliberate step towards the institutional architecture of the Global South, and a faint but unmistakable distancing from the post-World War II order long dominated by the World Bank and International Monetary Fund.

For a country that has consistently emphasised fiscal restraint, the size of the deposit is striking. Indonesia is not flush with excess cash. Ministries have been tightening belts, pushing efficiency and postponing ambitious programmes.

Yet the government still deemed the billion-dollar contribution as a worthwhile bet – a long-term investment in a new circle of development partners and a quieter expression of discontent with the pace of reform in Western-dominated multilateral banks.