Outlook for 2011-15

• The president, Susilo Bambang Yudhoyono, has a strong mandate to pursue his reformist policy agenda, having won re-election comfortably in July 2009, but his reforms are encountering resistance from vested interests.
• Indonesia will elect a new president to succeed Mr Yudhoyono in 2014. A requirement of the election law means that the next president is likely to be the nominee of one of the country's three main political parties.
• Bank Indonesia (the central bank) will seek to "normalise" monetary policy by gradually raising interest rates.
• The fiscal deficit will widen in 2011, to the equivalent of 1.4% of GDP, but it will then narrow during the remainder of the forecast period, owing to a rise in revenue.
• The Economist Intelligence Unit forecasts that real GDP growth will accelerate to an average of 6.3% a year in the forecast period, driven mainly by private consumption and fixed investment.
• We expect the current account to record an average surplus equivalent to 1.5% of GDP in the forecast period. The income account will stay in deficit, owing to the repatriation of earnings by foreign-owned companies.

Monthly review

• Members of the Golkar party and Prosperous Justice Party (PKS) have retained their posts in Mr Yudhoyono's cabinet, despite defying the president by voting for a full-scale parliamentary investigation into tax corruption.
• One of Mr Yudhoyono's sons is to marry a daughter of Hatta Rajasa, the chairman of the National Mandate Party (PAN), something that will unite two of the country's foremost political families.
• Despite the fiscal risks posed by a recent increase in global oil prices, officials have again postponed plans to restrict the sale of subsidised fuel products.
• Proposed revisions to the legislation that established the Anti-Corruption Commission (KPK) could weaken the watchdog's ability to prosecute those suspected of graft.
• Japan is one of Indonesia's most important trade and investment partners. The earthquake and tsunami that struck Japan on March 11th could negatively impact the Indonesian economy this year.
• Inflation slowed in March, with consumer prices rising by 6.7% year on year, down from a rise of 6.8% in February, according to the national data office, Statistics Indonesia. On a month-on-month basis consumer prices fell by 0.3%.