Ground shifts in Indonesia’s economy as conservative Islam takes root

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    JAKARTA – Arie Untung, a former video jockey for the Indonesian offshoot of MTV, says he used to drink alcohol regularly and – back then – was a jeans-clad, spiky-haired rocker who was only a nominal Muslim.

    But he says his religious fervor was rekindled by online preachers promoting more conservative interpretations of Islam, which are gaining ground in the world’s most populous Muslim-majority country and bringing profound changes in its economy.

    Untung has now reinvented his career by linking up with other celebrities to run a sharia (Islamic law)-friendly entertainment business in Southeast Asia’s biggest economy, including hosting popular Muslim prayer festivals.

    They are part of a growing body of “born-again” Muslims driving social changes that are also having an economic impact, encouraging everything from Muslim-targeted housing to sharia banking.

    “We have become some sort of like endorsers, the endorsers of Allah,” said Untung, who now sports a beard and a more restrained hair style, referring to his celebrity colleagues.

    The celebrities, who jointly have over 20 million followers on Instagram and Twitter, are part of what has become known as the “hijrah” movement in Indonesia and, according to Untung, aim to make an Islamic economy more mainstream.

    Hijrah, Arabic for migration, is used to refer to Prophet Mohammad’s journey from Mecca to Medina to escape persecution, and represents the beginning of the Muslim era.

    Indonesia’s 215 million Muslims have traditionally been moderate and their beliefs often included elements of mysticism and local customs.

    The number of conservatives is now growing and more companies have embraced Islamic branding and marketing, said Edy Setiadi, secretary general of the non-profit Shariah Economy Society.

    Restaurants have raced to secure halal certification, which means they comply with Islamic law.

    There are now hospitals where drugs are halal compliant and shampoos claiming to be suitable for headscarf wearers. Japan’s Sharp sells refrigerators labeled halal.

    Many born-again Muslims are young, earn regular salaries and prepared to go the extra mile to feel they are living an Islamic lifestyle, said Setiadi.

    “They don’t think about how much they spend, they just want peace of mind,” he said in an interview at his office in Jakarta.

    Conservative Islamic groups were largely repressed during the 32-year rule of strongman Suharto, but since his downfall in 1998, they have emerged as a growing force, although officially, Indonesia remains secular.

    During April elections, President Joko Widodo, a moderate Muslim, picked elderly conservative cleric Ma’ruf Amin as his running mate, a move seen as helping him secure more Muslim votes for his re-election.Amin, chairman of the Ulema Council of Indonesia, a group of clerics, has promoted laws for Islamic banking and mandatory halal certification and his vice presidency may usher in more incentives for the Islamic economy, analysts say.

    A report by Thomson Reuters, the parent of Reuters News, estimated Indonesians spent more than $219 billion on halal food, tourism, fashion and cosmetics in 2017, compared to $193 billion in 2014.

    Islamic banking assets were 486.9 trillion rupiah ($34.26 billion) by June 2019, representing more than 300% growth in the last nine years, even though they remain less than 6 percent of total banking assets at around $580 billion.

    There has been particularly rapid growth in demand for halal food, modest fashion and Islamic travel, Dody Budi Waluyo, a deputy governor of Bank Indonesia (BI), told Reuters.

    “BI sees a potential growth in the sharia economy amid demand for products certified halal and a halal lifestyle,” said Waluyo. He said the central bank and the government were trying to pin down the sharia economy’s share of GDP, and could not vouch for the accuracy of some estimates of the sector accounting for 40%.

    Some housing developments now target Muslims, like the Az Zikra gated community near Jakarta, which offers 400 households “the chance to follow in the footsteps of Prophet Muhammad.” – Reuters