Indonesia's bid to exert control over global prices for its vast natural resources by setting up a new commodities exchange will struggle to compete with established bourses and risks backfiring if participation is mandatory.The exchange, scheduled for launch next year, is President Prabowo Subianto's latest initiative to expand state influence over natural resources in a country that is the biggest global supplier of palm oil, nickel and thermal coal and a major source of copper and bauxite.
In a fiery speech to parliament last month, Prabowo said that Indonesia would rather keep its commodities than sell them too cheaply.
Trading through the exchange will be mandatory, said Sarjito, who was appointed chief supervisor of commodity trading and like many Indonesians uses one name.
Prabowo's move comes as his approval rating has fallen 30 percentage points to 51 percent in eight months, and critics say the exchange plan is as much about political messaging as economic strategy.
Yanuar Nugroho, a former top aide to Prabowo's predecessor Joko Widodo, called it a nationalist narrative "good for campaign material", rather than sound policy.
