JAKARTA - POLITICAL watchers and the financial markets alike were upbeat the day after Indonesian voters gave incumbent President Susilo Bambang Yudhoyono a strong mandate in Wednesday's presidential election.

Economic analysts cheered his re-election, predicting that it showed Indonesia was poised to join the developing world's fast-growing economies.

Investment bank Goldman Sachs forecast economic growth would hit 4.2 per cent this year and 5.2 per cent next year - at a time when many other countries are facing declining or negative growth.

The expectation is that the strong mandate will strengthen his hand in overcoming political and bureaucratic obstacles to push through radical reforms that will allow Indonesia to grow at a brisk pace, comparable to that of the so-called BRIC club of Brazil, Russia, India and China.

Mr Milan Zavadjil, Indonesia's country head for the International Monetary Fund, echoed many other analysts when he ticked off what Dr Yudhoyono had to do to get there.

'To go to the China level you need to take care of some issues, like major improvements in infrastructure, the investment climate and the legal system,' he said.

Conditions for investment - declining interest rates, a stable rupiah and inflation that is kept in check - were currently good and set to get better, he said.

Improving people's lives was also on his priority list, he said, noting that the government, in drafting the 2010 Budget, would focus on schemes to reduce unemployment.

Infrastructure, better irrigation systems for farming and new power plants would also be built.

Political analyst Anies Baswedan said that as the law did not allow Dr Yudhoyono to run again in 2014, he would likely use his second term to deliver policies that would leave behind 'a positive, tangible legacy'.

Read the full story in Friday's edition of The Straits Times.

lynnlee@sph.com.sg