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The balance of economic power shifts towards Asia
Indonesia correspondent Helen Brown reports from Jakarta on the shifting balance of global economic power.

Once upon a time, it was the leaders of the developing nations who made the long trek around the globe to talk to their counterparts in the industrialised world.

Now the boot is increasingly on the other foot.

In recent days, for example, German Chancellor Angela Merkel visited Jakarta to talk to Indonesian President Yudhoyono.

It's a reminder just how much the balance of economic power has shifted.

Indonesia correspondent Helen Brown reports from Jakarta.
Transcript
HELEN BROWN, REPORTER: It was the moment that signalled an historic shift for Indonesia. The head of the International Monetary Fund, Christine Lagarde, was making her first visit and she was full of praise.

CHRISTINE LAGARDE, IMF MANAGING DIRECTOR: In the meeting that I just had with Mr President and his colleagues, I told him how impressed I was with the reforms that have been conducted in the last decade, with the results produced by the Indonesian economy.

HELEN BROWN: At the height of the Asian financial crisis 15 years ago, Indonesia was in a much different position, forced to seek a multibillion dollar bail out from the IMF as its economy teetered. That debt was paid off in 2005 but the humiliation lasted.

In the past week, that all changed. A point even the president allowed himself to quietly make.

SUSILO BAMBANG YODHOYONO, INDONESIAN PRESIDENT (Translation): Now we can stand up firmly in front of the IMF.

HELEN BROWN: Indonesia also agreed to invest $1 billion in IMF bonds, its way of contributing to the fund, and revealed it's had discussions about putting money into the World Bank as well.

MAHENDRA SINEGAR, INDONESIAN DEPUTY FINANCE MINISTER: Indonesia is a member, Indonesia is the shareholder of the IMF and World Bank. So it can do whatever it wants with that (laughter); not the other way around.

HELEN BROWN: The past year has seen a succession of foreign ministers, leaders and officials visit Indonesia, ready to congratulate it and keen to talk business. Developed nations which usually set the terms of engagement are now looking for a new kind of relationship. Even the powerful Germany is seeing this emerging economy as a possible lifeline in the eurozone storm.

CHATIB BASRI, CHIEF, INDONESIAN INVESTMENT BOARD: The interest is there, but I’m always conservative. I cannot say that they’re going to realise it very soon.

HELEN BROWN: Indonesia's been attracting record levels of foreign investment and that figure’s expected to stay strong. But despite the resilience, risks remains and the latest World Bank report on the country cautions that it’s not immune from the impacts of the global downturn and needs to be prepared.

SRI MULYANI INDRAWATI, MANAGING DIRECTOR, WORLD BANK: For any policy maker in the world, you need to be vigilant in managing the economy.

HELEN BROWN: It's been a busy week for Indonesia; two of the key negotiators of the eurozone crisis in the country at the same time as well as the Indonesian managing director at the World Bank.

Indonesia wants to be seen to be stepping up to its new status and responsibilities but it's also at the mercy of global volatility and everyone's waiting to see what the winds of change will blow next.
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