| Home > South-East Asia >> Indonesia | |
ASIET Net News 31 – August 3-10, 1997
Human Rights Solidarity Action Committee - August 9, 1997
[The following is an abridged translation of a statement sent to
ASIET by the underground Peoples Democratic Party]
Haris Musi Akbar was a student of the legal faculty of the
Djuanda university, class of 1996. He is only 19 years old but
even at such a young age had become critical and active in
defence the people and justice. Haris' activism began with the
Student Communication and Pro-democracy Forum (Forum Komunikasi
Mahasiswa Pro Demokrasi, FKMPD). FKMPD was a study group who's
target was only to discuss social and political issues in
society. But after realizing that it was just a discussion group
and unable to change anything, Haris became involved as a pro-
democracy and justice activist.
On April 28, along with pro-Megawati Indonesian Democratic Party
(PDI) cadre, Haris attended a solidarity action for PDI figures
who were accused of masterminding the July 27, 1996 riots in
Jakarta. Haris had an understanding of the law and saw for
himself that Indonesian law is only for those with power and
money. At the trials of Peoples Democratic Party activists Haris
learnt that there is no justice in this country.
Along with seven pro-Megawati activists, Haris was beaten and
arrested by the authorities during a pro-democracy action. Five
were released but Haris and Anom Winanto (a Jakarta UNAS student)
and PDI cadre are still being held. They are both being charged
under the "Hate sowing articles" (Haartzai Artikelen) which was
used against political activists resisting Dutch colonialism.
This law was used against political activists who resisted Dutch
colonialism.
What happened in jail was inhuman. When Haris' parents visited,
they had to pay 150,000 Rupiah. The culture of collusion and
corruption has spread to all levels of the legal apparatus, so it
is not strange that Edi Tanzil was able to escape from jail.
Information was obtained that Haris could be freed for a bribe of
six million Rupiah.
We from the Djuanda university and the Solidarity Action
Committee for Human rights, question the legal process in
Indonesia and demand:
1. That the Djuanda university rector resolve the case of Haris
Musi Akbar and assist in his release;
2. The right to organise and express opinions, verbally and in
writing, be given to the people of Indonesia, and they be free of
military and government intervention;
3. Investigate the actions of the judiciary, prison officials,
drivers and those who practicing corruption;
4. Demand the withdrawal of the Hate Sowing Articles and the
left-over laws of colonialism which shackle the political rights
of the people.
We invite all pro-democratic forces to show solidarity for Haris
Musi Akbar and his comrade, Anom Winanto.
[Translated by James Balowski]
Human Rights Solidarity Action Committee - August 8, 1997
[The following is a slightly abridged translation of a chronology
sent to ASIET by the underground Peoples Democratic Party]
On Friday, August 6 the trial of two pro-democracy activists
began at the south Jakarta state court. The two accused, Haris
Musi Akbar (a first year Djuanda University student) and Anom
Winanto (an UNAS student and pro-Megawati cadre) are being tried
under the "Hatred sowing articles" (Haartzai Artikelen) for
their involvement in a pro-Megawati solidarity action. Haris and
Anom were arrested and detained during a solidarity action for
Budiman Sujatmiko and others from the Peoples Democratic Party
(PRD).
So we as students of the Djuanda University in Bogor [West Java]
joined together in the Human Rights Solidarity Action Committee
(Komite Aksi Solidaritas untuk Hak-Hak Mahasiswa, KASHM) to hold
a solidarity action on the grounds of the Djuanda University. The
following is a chronology of the action.
9.45am - The action was lead and opened by Ajis, from the Student
Communication Forum for Democratic Struggle (Forum Komunikasi
Mahasiswa Perjuangan Demokrasi, FKMD) with a speech inviting the
masses to gather at the local parliament (DPR).
At that time there were about 30 people, a number of students
were still having exams. Many intelligence officers were visible
in the area and around the campus grounds.
Ajis shouted "There is no longer any democracy in this country.
Students are prevented from speaking, organising..." At that time
Budiman Sudjatimiko's father arrived and watched the action from
some distance. A KASHM activist approached him to explain about
the action.
9.48am - A speech was given by Sisi from FKMPD while posters were
distributed and unfurled. The writing on the posters read:
Withdraw the packet of five political laws, withdraw the dual
function of the military, stop military intervention on campus,
withdraw the anti-subversion laws, don't muzzle criticism, don't
take the political rights of the people, free our comrades, free
Haris Musi Akbar, don't blame the people for taking action, where
is justice in this country?, don't suppress democracy in the name
of stability.
9.57am - A poetry reading by Yani from the north Jakarta Megawati
Defence Team (Tim Pembela Megawati, TMP) titled "Until when" and
"A picture of this country" was given.
10.00am - Lead by Ajis, the demonstrators sung Indonesia Raya.
The crowd outside the campus continued to grew larger, coming
around the action. Using a megaphone, Ajis invited them to join
the action.
10.05am - A speech was given by Le Ode (a Djuanda student and
chair of KFMPD): "Haris is not an bad person, instead he fought
for his rights, fought for the peoples' rights, demanding
democracy and against military intervention".
10.10 - A speech was given by a representative from the Jakarta
National University in solidarity with Anom Winanto who explained
what was behind the arrest of Anom and Haris, that they were
students who were not only critical in their thinking, but
courageous in acting to defend ordinary people who are cheated by
the current economic and political system which exists in
Indonesia. "Anom and Haris were arrested because of their
solidarity with democratic activists from the PRD who have also
been active fighting for the oppressed people in demanding their
rights which have been taken by those in authority". He also
saluted the solidarity of the Djuanda students trying to build
solidarity with the daily struggle of public transport drivers.
10.13am - A poem was read by Agil from FKMPD.
10.20am - Demonstrators sang "Unite" and "Who's Indonesia"
followed by a speech from Ajis about the aims of the action.
10.30am - A statement from KASHM was read by La Ode.
10.35am - They sung "Blood of Struggle"
10.40am - Prayers
10.45am - The action ended
[Translated by James Balowski]
East Timor
Environment/land disputes
Human rights
Arms/armed forces
International relations
Economy and investment
Miscellaneous
Democratic struggle
Statement on the arrest of Haris Musi Akbar
Chronology of KASHM action on August 8
Release of jailed journalists baffles many
Interpress News Service - July 31, 1997
Samsudin Berlian, Jakarta – The jailing more than two years ago of two journalists who defied the Indonesian government by publishing an unlicensed magazine was hardly a surprise. But their recent release has baffled many.
To the surprise of the journalistic community here, authorities freed Eko Maryadi and Ahmad Taufik from separate prisons in West Java on Jul 19.
There was no explanation for the release of the two, both founding members of the Alliance of Independent Journalists (AJI), who were sentenced to three years in prison in March 1995.
But rumours here have it that Western governments and donors had sought their release. Some had it that the new information minister had a hand in it, or that South African President Nelson Mandela requested it during his recent visit to Indonesia.
Whatever the case, Eko, 29, and Taufik, 32 walked out from their prisons in Cirebon and Kuningan unrepentant and defiant.
"I come out the same person I came in," Eko told IPS.
"It seems that this is the time when the government wants to show off their leniency (on the press) to the world," said Dewi Novirianti of the Jakarta Legal Aid Institute, which defended the journalists during their trial.
However, it was not clear if their release would pave the way for the freedom of another journalist, Andy Syahputra, who was arrested in October last year. Syahputra, a supporter of the opposition democracy movement, owned a small printing press in Jakarta, where police seized 5,000 copies of 'Suara Independen' (The Voice of Independence), a clandestine publication that replaced the magazine 'Indepeden' that Eko and Taufik used to put out before their arrest.
Eko and Taufik were separately arrested in March 1995 for circulating the unlicensed 'Independen', published by the AJI. They since spent two years and four months in various prisons until their conditional release about two weeks ago.
Freed eight months shy of their full prison terms, they are however required to report regularly to the police and prosecutor's office.
They vowed to continue to work for a freer press in Indonesia and both are bracing themselves for a long struggle as they expect the political situation not to change much, "even after he's gone", Taufik says, referring to President Suharto, who has been in power for 30 years and looks poised to stay for more.
Their saga began when the influential news magazine 'Tempo' – where both earlier worked – and two other magazines were banned in June 1994. This sparked demonstrations and the birth of a new form of opposition: the alternative media.
After 'Tempo' was banned, the 'Indepeden' gained prominence and credibility. It was the brainchild of AJI, an organisation of independent journalists formed in reaction to the government clampdown on the media.
The magazine openly taunted the government, listing the names of its editorial board members, its address, and its bank account just like any other respectable publication.
Taufik, then AJI president, and Eko were actively involved in the preparation and publication of the magazine that dwelt on areas no licensed publications dared touch.
In its 10th issue, the magazine divulged the shares owned by then information minister Harmoko in more than 30 companies and claimed he obtained many of them through abuse of power. The issue was later used as proof of defamation against them in court.
Taufik and Eko were arrested on the night the magazine's 12th edition came out. Taufik was picked up from his apartment, while Eko was taken by police during a raid on AJI's office. An office messenger, Danang Kukuh Wardoyo, was separately arrested and later sentenced to 20-month imprisonment. Taufik and Eko were charged with inciting hatred and hostility toward the government – a legal relic from the colonial rule – and for publishing an unlicensed publication.
The two viewed the court proceedings as a farce, believing that their expression in media of issues objectionable to the government had been proof enough for judges to find them guilty.
"This only showed how weak the regime really was, so much so that it needed to exert its power in the smallest matter, even in the fate of an office boy," Taufik said.
They were sentenced to two years and eight months in prison, but a higher court later increased the sentence to three years. The Supreme Court upheld the ruling.
Though moved from one prison to another, they were relatively free to read and write. Their articles appeared in almost every edition of 'Suara Independen', being published by the Indonesian Movement of Supporters of the Alternative Press. The movement's offices are believed to be in Australia, according to the Paris- based 'Reporters San Frontieres'.
For Taufik, the darkest moment came when they were moved from a prison in Jakarta to the one in Cirebon last August. "We were gathered in the middle of the night at gunpoint, and handcuffed. I did not know what was going on. The guards acted threateningly. And when the truck went through the woods, I feared summary execution," Taufik recounted.
"When we arrived, I almost got beaten for refusing to strip naked in front of everybody," he added.
The slender Taufik is cherishing his new freedom together with his wife and son, who was only 10 days old when he was arrested. Taufik plans to join a licensed media outfit "for I need a steady income to support my family".
"The imprisonment was a stopover in my life," he said. "I am not a brave man. I was a victim by accident. It could have happened to anyone."
Eko plans to write a book about his prison life, while working for a freer society through the media. But he is not inclined to join any licensed media. "I'd rather publish (an unlicensed publication). Easy," he said. "Don't ever beg for press freedom from the government. Just do it."
| East Timor |
Lusa - August 4, 1997
Pretoria – The South African President, Nelson Mandela, has said he invited East Timorese leaders to visit the African country in September.
He told also reporters on Friday that Indonesia's President General Suharto will visit Pretoria in November, as part of Mandela's recent initiative to assist the United Nations (U.N.) to find a solution for the troubled territory of East Timor.
Indonesia invaded East Timor in 1975 and annexed it one year later but the U.N. still regards Portugal as the territory's administering power.
Portugal has supported the territory's demands for the right of self-determination.
East Timorese Bishop D. Ximenes Belo, confirmed on Friday that he had accepted Mandela's invitation "in principle" and said he would visit South Africa in September or October, South Africa's presidency spokesman, Parks Mankahlana said.
Belo, together with activist Jose Ramos Horta were awarded the 1996 Nobel Peace Prize for their efforts to seek a peaceful solution for East Timor.
| Environment/land disputes |
Straits Times - August 3, 1997
Susan Sim, Jakarta – The good news is that the Indonesian forest fires this year are not as extensive as those three years ago.
The bad news is that they will be an annual problem for more years yet, despite the best intentions and efforts of the Indonesian government.
"Understand that we are doing our very best to limit the amount of haze being generated. And I think we've been very successful," Environment Minister Sarwono Kusumaatmadja told The Sunday Times yesterday. His ministry has in the last few years been co- ordinating efforts with the authorities in Singapore and Malaysia to combat the fires, caused in part by the hot season at this time of the year and by burning by farmers and loggers.
This time around, the fires – which he described as bush, and not forest fires – have spread over 9,000 ha of land in central Sumatra and Kalimantan.
The resulting smoke and haze have caused airports in Pekanbaru in the Riau province and Pontianak in West Kalimantan to close their facilities to morning traffic, he said.
He confirmed that these interim closures would continue for as long as visibility in the areas remained low.
But if prolonged, the measures are likely to disrupt commerce in Sumatra, because the Simpang Tiga airport in Pekanbaru, with its visa-free facilities and direct flights to Singapore and Kuala Lumpur, is one of the busiest airports in the province.
The minister said, however, that he had not received any report that the haze had also affected operations at Singapore's Changi airport, about 300 km from Pekanbaru. "We're trying our best to make sure that does not happen," he pledged.
Singapore environment officials are due to arrive in Jakarta on Tuesday for discussions on the situation, he added.
In the past, the Republic has provided satellite imagery which showed where the hot-spots were, enabling Indonesia to put those fires out promptly and stop the haze from blanketing the region.
Malaysia too has been giving similar meteorological information, he said, noting that joint action by the three countries had worked well since 1994, when fires across Indonesia caused air quality in the whole region to plummet for several months, prompting widespread health concerns.
Blaming plantations in Kalimantan and Sumatra as the "chief culprits" behind the fires, Mr Sarwono said the government was cracking down on them to stop the clearing of land by the burning of bush and trees.
Forestry Minister Jamaludin Suryohadikusumo was also quoted as saying earlier that companies would no longer be allowed to burn unused wood and other materials left over from logging or land- clearing operations.
Jakarta is also trying to persuade traditional "slash-and- burn" farmers to drop the practice, but the relative isolation in the Kalimantan heartland has made it difficult to reach them, Mr Sarwono said.
It would take years to convert all of them to other methods of cultivation, so it is likely that bush and forest fires will still continue to pose a danger to the environment.
And then there is the question about the weather.
The scale of deliberate burning is now lower than three years ago, but the current drought is worse and spontaneous flares cannot be avoided, he noted, lamenting, half in jest: "You cannot regulate the climate. So, if God decides to have a long period of rest, what can we do?"
In the meantime, he called for patience from Singaporeans should the haze worsen. "It's not like putting out fires in Orchard Road. It's a much more complex affair than that," he said, adding:
"Understand that we have a big problem and that it is a very nasty problem for us. So don't over-dramatise it because when it comes to suffering, we're the ones who suffer the most, not you."
| Human rights |
South China Morning Post - August 7, 1997
Jenny Grant, Jakarta – A war between police and criminals is escalating in Jakarta following the killing of a mobile-brigade policeman last week.
Police and the military have launched a joint hunt for the killer of 27-year-old First Sergeant Winoto.
Winoto was shot twice in the stomach and suffered machete wounds on Friday in West Jakarta while he was accompanying a gold delivery.
Police from each region of Jakarta have set up a taskforce to find the killer.
In North Jakarta 246 police and military officers are searching nightclubs, known meeting places for criminals.
Since Sunday, 212 suspects have been arrested.
Winoto is the second Jakarta police officer to be killed this year.
Meanwhile, killings by police of more than 70 alleged criminals this year have passed almost unnoticed.
The Sinar weekly magazine reported that 110 suspected criminals had been shot dead in Greater Jakarta between January and April this year. In 1996 only 89 suspects were killed by police.
The alleged car thieves, thugs and vandals are usually shot in the back when fleeing a crime scene.
Police claim they first fire the mandatory three warning shots in the air before shooting the victims.
Authorities deny there is a formal shoot-to-kill policy.
Jakarta police chief Major General Hamami Nata has defended his officers, saying they followed procedures before shooting. But he has given carte blanche approval to any officers to shoot if they feel threatened.
"If the criminal reacts and threatens officers, just shoot," the magazine quoted the police chief as saying.
Criminologists point to widespread concern in the military about rising crime and its potential to disrupt the capital, which is home to nine million people.
Criminologist Mulyana Kusumah said the number of crimes involving firearms in Jakarta was growing.
In 1996, the number of firearms-related homicides rose to 80, from only 18 in 1985.
One police officer said criminals shot dead by police were usually multiple offenders.
"They have been in and out of jail and they keep committing crimes. We don't have any choice, if we leave them they will be a danger," the officer said.
Agence France Presse - August 7, 1997
Jakarta – Indonesia's independent trade union leader filed a judicial review to the Supreme Court, asking the body to review his conviction over the April 1994 Medan riots.
Appearing in court for the first time since his hospitalisation in March, Pakpahan told the East Jakarta court they had new evidence to prove that he did not incite the riots.
'We have eleven new witnesses who are ready to testify for him,' Pakpahan's lead lawyer, Lufti Hakim said. They were ready to testify that they had received a circular from the SBSI headed by Ppakpahan, calling for the delay of the strikes from April till October 1994.
In November 1994, a court in Medan jailed Pakpahan for three years for incitement; a court of appeal added another year.
However, to the surprise of many, the Supreme Court in December 1995 cleared Pakpahan of all charges, citing insufficient evidence for his conviction. In Octoher 1996, the same court overruled its earlier verdict and reimposed the jail sentence after the prosecution, in a step deemed highly unusual by legal exports, appealed the court's verdict.
The judicial review was submitted Thursday in Jakarta, not in the Medan court where it should have been filed, because Pakpahan is unable to travel due to his poor health and because he is currently also facing subversion charges at another Jakarta court.
[NB: Ppakpahan is still hospitalised at Cikini Hospital, Jakarta.]
Jakarta Post - August 6, 1997
Jakarta – The National Commission for Human Rights promised yesterday to urge the government to form an independent medical team to seek a third opinion on labor leader Muchtar Pakpahan's health. Commission member Muladi told Pakpahan's lawyers and a delegation from the Indonesian Prosperous Labor Union (SBSI) that the commission would send a letter to Minister of Justice Oetojo Oesman and Attorney General Singgih asking them to form a team to get a third opinion or facilitate lung imagy fluorescence endoscopy (LIFE) treatment.
Muladi said that if the government could not provide LIFE treatment, then it should " just let Pakpahan go abroad, to Singapore at least, accompanied by a Army Special Forces officer or a commission member if needed".
Pakpahan, chairman of SBSI, was admitted to Cikini Hospital in Central Jakarta in March while he was on trial for subversion. During the proceedings, Pakpahan demanded that a nonprison doctor examine him. His request was initially denied. Last month he asked the government to let him travel abroad for treatment because Cikini Hospital doctors recommended LIFE treatment, which is unavailable in Indonesia. The government then sought a second opinion from a team of doctors from state-run Cipto Mangunkusumo General Hospital, who found that there was no need for Pakpahan to travel abroad.
Pakpahan then demanded an independent medical team involving the international committee of the Red Cross to seek a third opinion. In a letter delivered to the rights commission yesterday, Pakpahan questioned the attorney general's statement that he could be treated here, whereas the second opinion did not disclose an exact diagnosis. According to Pakpahan, the prognosis of the second opinion, which claims the labor leader's illness does not need treatment abroad, is still far from definite.
Notes:
AFP reported from Jakarta on 7 August that the Attorney General's office has dismissed a demand for an independent medical examination for Muchtar Pakpahan. 'The demand is no longer necessary,' said deputy attorney general Ismujoko, adding that opinions given by health ministry doctors and the Cipto Mangungkusumo Hospital were 'enough'.
'I am still convinceed that I will be given the chance for a third opinion because that is my right as a patient and a citizen,' said Pakpahan, speaking during a court session in East Jakarta, Thursday.
Pakpahan and his unrecognised labout union have called for an independent medical examination, accusing state doctors of basing their opinion on a 'political' decision.
'The result (from the state doctors) said that they did not know exactly what was wrong with me but concluded that I did not need the LIFE treatment,' Pakpahan said Thursday. 'The second medical check-up had just two objectives: to bar me from going abroad and to say that I am well enough to go on with my (subversion) trials. It was not done for my health,' he said.
Kompas - August 5, 1997
A delegation of US senators led by Craig Thomas (Dem. Wyoming) consisting of eleven people met members of the National Human Rights Commission and reached agreement to keep in close contact, so as to reach a common understanding on human rights and democracy.
The delegation included Allen Weinstein, Richard H Houghton, Donna Gold, Kathleen Connors, Fred F. Fielding, D. Jeffrey Hirschberg, Santra Taylor, John Dawkins and Anton van der Lande. (It's not clear whether they are all senators.)
In a statement to the press following the meeting, Senator Craig Thomas stressed the importance of their visit to Indonesia, especially to exchange views about human rights in this part of the world. We came here, representing the Centre for Democracy, in order to study all aspects of human rights, economic and political.'
He said the visit would open the way for cooperation and mutual assistance between non-governmental organisations. 'Bearing in mind Indonesia's importance as a member of ASEAN, we think it is very important to maintain regular contact.'
He acknowledged that they had touched on questions like Muchtar Pakpahan, Sri Bintang Pamungkas and the 27 July case, but had not gone into any detail.
Second vice-chair of Komnas HAM Marzuki Darusman said that they had reach common agreement about the need for regular contact on the question of human rights and democracy.
'It is not possible for the US to force their view of human rights and democracy on other countries. The US, France and Indonesia have different basic philosophies on these matters,' he said.
During the meeting members of Komnas HAM had stressed the importance of the US and other countries acknowledging that human rights abuses in Indonesia which are always being talked about in western societies, should not be seen as a systematic policy. Indonesia, for its part, needed to understand polic considerations in the US.
'The question of human rights violations in Indonesia and the case of Patrick Kennedy (Dem. Rhode Island) should not be considered from a narrow perspective. There is a need for mutual understanding between our two countries so as to ensure that these obstacles don't damage the relations (between the two countries). That's why we hope that when Senator Thomas returns home, the results of our discussions can be widely disseminated throughout the US and also to other members of the US Congress,' said Marzuki.
Voice of America - August 5, 1997
Jakarta – The private secretary of one of Indonesia's founding fathers was put on trial in Jakarta Tuesday, for insulting president Suharto by printing a booklet written by his employer. Jenny Grant reports it is the latest in a string of political trials in Indonesia.
State prosecutors at the south Jakarta district court said 34 year old Buyung Rachmat Buchori printed 10-thousand copies of a booklet entitled "New Era, New Leadership" in January. they say allegations made in the book are insulting to the president.
The booklet was written by Mr. Buyung's employer, Subadio Sastrosatomo. he was one of the youngest in a group who proclaimed Indonesian Independence in 1945. He went on to lead the Indonesian Socialist Party, and is now renowned for his books and articles which criticize the government.
The 18-page "New Era, New Leadership" accuses president Suharto of being a liar and using the nation for his personal profit. Mr. Sastrosatomo names the national car project, awarded to one of Mr Suharto's sons – and the Freeport gold and copper mine in Irian Jaya headed by a long-time associate of president Suharto – as examples of alleged nepotism by the president.
Lawyer Hendardi from the Indonesian Legal Aid and Human Rights Association says the government is prosecuting Mr. Buyung to scare anyone who is working with government critics. He says the political cost for the government would be too high if it brought the respected Mr. Sastrosatomo to trial.
Human rights advocate Johannes Princen also told V-O-A it is unlikely Mr. Sastrosatomo will brought to trial himself, given his prominent role in founding the nation.
Insulting the president or vice president carries a maximum sentence of six years in jail.
In a similar case in April, a Jakarta court sentenced Andi Syaputera to two and a half years in jail for insulting the head of state by disseminating printed materials that insulted the president. The magazine he distributed, "Suara Independen," was published from the Australian city of Melbourne by a group linked to the Alliance of Independent Journalists.
Mr Buyung's case is the latest in a number of highly politicized trials of activists, trade unionists and government opponents. So far this year the government has jailed parliamentarian Aberson Sihaloho, trade unionist Muchtar Pakpahan and outspoken former member of parliament, Sri Bintang Pamungkas.
In april, 14 pro-democracy activists from the Peoples Democratic Party were jailed for up to 13 years on charges of subversion.
| Arms/armed forces |
International Herald Tribune - August 6, 1997
Michael Richardson, Singapore – Defying its human rights critics in the United States, Indonesia said Tuesday that it would buy Russian fighters and helicopters after canceling a deal for American-made F-16s because of congressional attacks on its human rights record.
Jakarta's decision to turn to Russia was a serious setback for U.S. defense companies trying to sell weapons in the fast-growing but increasingly competitive Asian market, analysts said.
The news could encourage other U.S. customers in the region, they said, including the Philippines, Thailand and South Korea, to start buying Russian weapons, which cost substantially less than comparable U.S. equipment.
The Philippines and Thailand, both operating under tight budget constraints, have expressed interest in low-cost Russian fighters and associated missiles, while South Korea has said it is considering a futuristic Russian Sukhoi jet for a major order of 120 fighters to be delivered after 2002.
Ginanjar Kartasasmita, Indonesia's state planning minister, said Tuesday that Jakarta would buy 12 Sukhoi Su-30K fighters for the air force and eight MI-17-1V troop transport helicopters for the army's elite commando Special Forces.
The decision was "based on a study and comparison of various helicopters and fighter planes," Mr. Ginanjar said. He indicated that Russia would probably get subsequent arms orders.
While Indonesia wanted 20 of the fighters "for the first phase, we decided on eight helicopters and 12 fighter planes," Mr. Ginanjar said. "There is a possibility we can buy more in future from Russia."
Indonesia's armed forces had also shown interest in Russian radar and missiles for a planned major upgrade of the country's air defense system, analysts said.
Most of Indonesia's military equipment is from the United States or Europe. Its most recent big order before the Russian purchase was announced Tuesday was for 16 Hawk fighters from Britain, worth about $260 million.
While Britain's Labor government confirmed last month that the Hawk contract with Indonesia would go ahead, it unveiled new rules to halt arms sales to regimes that might use British-made weapons for internal suppression or external aggression. "There is a worry in Jakarta that Britain might cut future military contracts," said Jusuf Wanandi, chairman of the supervisory board of Indonesia's Center for Strategic and International Studies.
"It is good to warn them now that we can buy from other countries without human rights conditions attached," he said.
Indonesia canceled a plan in June to buy nine F-16s from the United States to add to an existing squadron because of what the government said were "wholly unjustified criticisms" in Congress of its human rights record, particularly in East Timor, a former Portuguese colony invaded by the Indonesian military in 1975 and annexed the following year.
Indonesia also pulled out of a U.S. government-funded military education and training program.
"If arms sales are linked by any country to what we believe are extraneous issues, then we will simply find other suppliers," Ali Alatas, Indonesia's foreign minister said after the planned F-16 purchase was scrapped.
In a sign of Moscow's readiness to export its top-of-the-line military hardware without conditions, Indonesia will be the second country, after India, to get the advanced Su-30K fighter, which is considered superior to the Su-27 that China has acquired from Russia.
Analysts said that the Su-30K, which can fly at twice the speed of sound, has a combat range of 3,000 kilometers (1,800 miles), about three times that of an F-16 without aerial refueling.
They said that provided the Su-30K is properly maintained and supported, it should be well-suited to long-range patrol and interception missions in Indonesia, an archipelago of over 17,000 islands stretching for 5,000 kilometers (3,000 miles) along the Equator.
Mr. Ginanjar did not say when the Su-30Ks would be delivered.
But India's deal with Russia in November for 40 of the planes was reportedly worth about $1.8 billion. A similar deal with Indonesia would therefore be worth some $500 million
India has already taken delivery of the first of its Su-30Ks. Russia is expected to provide similar rapid delivery of both the fighters and helicopters to Indonesia when its pilots and support crews have been trained.
Mr. Ginanjar said that the Indonesian and Russian governments had yet to finalize details of the price and payment conditions, technology transfers, spare parts and after-sales backup.
But he indicated that at least part of the cost of the purchase would be a counter-trade arrangement in which Indonesia could exchange its commodities such as palm oil, coffee and rubber for the Russian aircraft instead of cash.
When Malaysia ordered 18 MiG-29 fighters from Russia for $600 million in 1995, becoming the first Southeast Asian country to buy Russian combat aircraft, it insisted on paying for part of the deal with Malaysian commodities.
Agence France Presse - August 5, 1997
Bhimanto Suwastoyo, Jakarta – Indonesia Tuesday brushed aside US criticism of its human rights record and said it would buy Russian fighter jets after cancelling an order for American aircraft.
Officials decided to buy 12 Sukhoi-30K fighter jets and eight M- 17-1V helicopters from Russia for use by the military, National Development Planning Minister Ginanjar Kartasasmita said.
Jakarta cancelled an order for nine US-made F-16 fighters following criticism in Washington of Indonesia's elections and human rights record in June.
Negotiations with Russia on the deal over price, payment methods, technology transfer and spare parts guarantees were on track and a Russian team was in Jakarta for talks, Ginanjar said.
Completion of the deal depended on an agreement on the price and counter-purchase commitments, he added.
In return for the aircraft purchases, Russia would be expected to buy Indonesian commodities including palm oil, coffee and rubber.
Jakarta would expect the planes to be delivered within three years and the helicopters within two years, Ginanjar said.
Indonesia cancelled its purchase of nine F-16 fighters after what it called "wholly unjustified criticisms" in the US Congress.
It also withdrew from the US Expanded International Military Education and Training Program, saying it objected to US criticism of the country's human rights conditions, particularly in the former Portuguese colony of East Timor. The US also angered Jakarta by questioning the fairness of May legislative elections.
The fighter jets would be based in Ujung Pandang, South Sulawesi province, primarily to Indonesia's strategic Natuna gas fields in the South China Sea, said Vice Air Marshal Richard Haryono, the assistant on planning to the air force chief.
Haryono said Russia was asking for 34 million dollars for each jet but the price had yet to be negotiated.
He added the sale agreement would include the sending of about 20 Indonesian personnel for training in Russia for up to eight months. Haryono said the Sukhoi-30K, with a range of 3,000 kilometres (1,860 miles) without refuelling and the possibility of on-air refuelling with a Hercules tanker plane, could quickly reach every corner of the far-flung archipelago.
The helicopters would be capable of transporting 30 troops or one tactical vehicle or ambulance.
However, Research and Technology Minister Bacharudin Jusuf Habibie criticised the purchase plan, saying the fighters were not as effective as US or European models or even other aircraft manufactured in Russia.
Sukhois had a number of weaknesses in direct comparison with their competitors, including the Russian-made Mig, which he dubbed more "agile" and "more superior."
Speaking after meeting Indonesian President Suharto, Habibie said Sukhois had shorter lifespans than their counterparts from the United States and Europe and shorter periods between overhauls.
Its long flight range necessitated large fuel tanks which mades the aircraft bulky and "less maneuverable" than short range fighters such as the Migs, he added.
The offer of Russian-made equipment and weaponry was first made by Russian President Boris Yeltsin to Indonesian President Suharto through a special envoy, Ginanjar said.
Suharto later sent a team of experts to Russia to study the weapons, he added.
Reuters - August 5, 1997
Andrei Khalip, Moscow – Indonesia's decision to replace a big defence order from the United States with arms from Russia heralds a big breakthrough for an industry badly hit by the collapse of the Soviet superpower.
Russia's biggest arms exporter Rosvooruzheniye said loose ends still had to be tied up following Jakarta's announcement on Tuesday that it wanted to buy Russian warplanes and helicopters.
But while the deal remained swathed in secrecy, officials and analysts say it strikes an important blow for Moscow in a battle for arms markets which has outlived the Cold War.
In June, Indonesia cancelled a deal to buy U.S. F-16 fighters over Congressiona attacks on its human rights record. Military analysts in Jakarta said the rebuff to Washington meant U.S. arms sales to Indonesia were unlikely in the next few years.
Rosvooruzheniye spokesman Valery Kartavtse said a conflict of interests between Moscow and Washington was natural in Indonesia. "Of course it is in our interest to sell armaments to the regions of Southeast Asia," Kartavtse said.
"This is what business is about... If they buy from one of us, it means they do not buy from the other."
A Russian military analyst said it was not yet clear exactly how profitable the deal would be, but it represented a big step forward for the industry.
"It is good news for Russia. Indonesia is known to pay well under all of its contracts," he said. "It also means re-establishing old ties in Southeast Asia."
The general director of the multi-billion-dollar state arms agency last month accused foreign competitors, mainly the United States, of conspiring to prevent Russia from completing lucrative new contracts.
He called the potential Indonesian deal "a huge breakthrough for Russia in the arms market in Southeast Asia, which was formerly under the complete control of the United States".
Indonesia expressed interest in buying Russian jets, helicopters, guided missiles and radars after cancelling a deal to buy nine U.S. F-16 jets in June.
On Tuesday, it said it would buy 12 Sukhoi Su-30K fighters and eight MI-17-1V helicopters.
The Russian analyst compared the situation surrounding the Indonesian contract with the aftermath of political unrest in China in 1989, when the People's Liberation Army crushed unarmed students on Tiananmen Square.
"The political angle recalls how the Soviet Union got hold of Chinese arms orders after the Tiananmen events. The West then warned China on human rights and Russia immediately jumped on the arms contracts, sqeezing the West out," the analyst said.
Ideally Indonesia wants to buy 20 fighters, and said it would consider further purchases from Russia. It is also in the market for a full upgrade of its air defence system and overall air traffic control.
Rosvooruzheniye is responsible for 95 percent of Russian arms sales and its exports in 1996 reached $3.5 billion. It has contracts worth $7 billion and hopes to increase the amount to $9 billion by the end of the year.
Indonesian officials said Jakarta and Moscow had yet to finalise price and payment conditions, technology transfers, spare parts and after-sales backup forthe deal, which included possible counter purchases of palm oil, coffee and rubber.
Officials at Russia's Defence Ministry and Sukhoi design bureau declined to comment on the negotiations.
Antara - August 5, 1997
Jakarta – Indonesia has finally decided to purchase 12 Sukhoi 30K (SU-30K) jet fighters and eight multi- purpose MI-17-1V helicopters from Russia to boost the equipment of the Indonesian Armed Forces (ABRI).
The decision was taken during a meeting led by State Minister for National Development Planning/Chairman of the National Development Planning Board (Bappenas) Mr Ginandjar Kartasasmita here Tuesday.
The Ministry of Defense and Security and the ABRI will negotiate with Russia on the price, terms of payment, transfer of technology, a counter-purchase scheme, date of delivery, spare parts and after-sales service.
Ginandjar however said no agreement on the final price of the warplanes has been reached as yet. "Russia for the time being has offered the Sukhoi SU-30 K at US$ 34 million (Rp 85 billion) per unit. But the price is negotiable," he said.
The Air Force has previously examined the Russian MiG-29 Fulcrum, the Sukhoi SU-27, the Sukhoi SU-30, as well as the French Mirage-2000 and the Swedish JAS-39-Grippen after plans to buy F- 16 jet fighters from the United States were cancelled.
Indonesia in May cancelled its plan to purchase nine F-16 fighters from the US citing "wholly unjustified criticism" in the US Congress against Indonesia.
After Indonesia cancelled the plan, it sent teams to Russia, France and Sweden to look for other fighter planes.
A joint team which studied the performance of the jet fighters has drawn up a set of criteria to decide on what kind of warplanes Indonesia will purchase. The team decided that the new jet fighter should match the performance of the F-16 (*).
The jet fighters should have the widest range of functions, the most modern performance and other qualifications, Ginandjar said.
| International relations |
The Star - August 6, 1997
Peter Fabricius – South Africa's dramatic expulsion of Portugal's ambassador at the weekend for allegedly holding and leaking to the press a misdirected letter from President Mandela to Indonesian President Suharto has created great controversy in diplomatic circles and raised a host of unanswered questions.
In the letter, written in mid-July, Mandela asked Suharto to release East Timorese rebel leader Xanana Gusmao as a first step towards resolving the conflict over the island of East Timor, which Indonesia occupied militarily in 1976.
Mandela wrote the letter after a surprise visit to Gusmao during his visit to Indonesia earlier last month.
The existence of Mandela's request to Suharto emerged only last week, when Mandela confirmed it, but it was denied by the Indonesian government.
According the Indonesian press, Suharto did not receive the letter until last Friday, two weeks after it was sent, because Mandela's office had sent it to the Portuguese embassy instead of the Indonesian embassy, who had leaked the contents to the Portuguese press.
South African government sources yesterday confirmed an Indonesian newspaper report that, as a result of his actions, Vasco Valente had been given 48 hours to leave the country. He left on Saturday..
But last night diplomatic sources raised many questions about the explanation of events given by the Indonesian and South African governments.
The biggest riddle was: why would a diplomat of Valente's calibre make such a stupid mistake as to retain a letter sent to him in error?
Portugal has been at loggerheads with Indonesia for 21 years over East Timor, which was a Portuguese colony at the time Indonesia invaded it. Since then Portugal has been locked in negotiations with Indonesia under United Nations auspices.
Lusa - August 6, 1997
Lisbon – Portugal has urged South Africa to resist pressure from Indonesia after Pretoria expelled the Portuguese ambassador Vasco Valente over the leaking of a misdirected note from President Nelson Mandela to his Indonesian counterpart, General Suharto.
The Foreign Ministry's spokeswoman, Ana Zacarias, reading a statement on Tuesday, said "South African authorities should not be susceptible to poisoning of Portugal by Indonesia", urging President Mandela to continue his efforts to find a solution for the southeast Asian territory of East Timor.
Mandela, who announced recently he would assist the United Nations efforts to resolve the conflict over East Timor, said he had written to Suharto in mid-July, asking him to release East Timorese rebel leader, Xanana Gusmao, serving a 20-year sentence in Jakarta's Cipinang prison for resisting Indonesian rule.
The letter was sent in error to the Portuguese embassy in the South African capital, and the ambassador thought that the letter was a copy for his consideration.
Indonesia invaded East Timor in 1975 and annexed it one year later but the United Nations (U.N.) still regards Portugal as the territory's administering power.
The U.N. has sponsored talks between Lisbon and Jakarta to settle the dispute, but they have failed to bring any results to date.
The ministry's statement said also that "despite our profound disappointment with the disproportionate attitude by the South African authorities, everything will be done to on the Portuguese side to ensure that a climate of good relations is maintained between Portugal and South Africa".
Agence France Presse - August 7, 1997
Jakarta – Jailed East Timorese rebel leader Xanana Gusmao said his release, as called for by South African President Nelson Mandela, was unimportant compared to the urgency for a settlement in East Timor, it was reported Thursday.
"My release is actually an unimportant matter. More important is how efforts to settle the East Timor problem in a just, peaceful and beneficial to all, can be continued," Gusmao told the Detective and Romantika weekly in its latest edition.
Mandela, who was granted a meeting with Gusmao when visiting Jakarta last month, has since called for the release of the East Timorese rebel who is serving a 20-year jail term here.
The release was essential to resolve the conflict in the former Portuguese colony, Mandela said.
Gusmao said he believed the South African leader's demand to meet him showed that "Mandela still sees that there are problems to be solved" in East Timor.
"That there is a world figure such as him who wants to see me, means that he considers the East Timor issue an important one," he said.
In the interview, Gusmao declined to give details on the content of his talks with Mandela, held at Jakarta's state guesthouse on July 15 with the blessing of President Suharto.
Reuters - August 5, 1997 (abridged)
Cape Town – South Africa, trying to unravel twin diplomatic blunders in its East Timor peace initiative, on Tuesday acknowledged a "miscommunication" over an announced visit by U.N. Secretary-General Kofi Annan.
Presidential spokesman Parks Mankahlana told Reuters a misunderstanding had led him and other government officials to announce that Annan would meet President Nelson Mandela in Pretoria on Friday to discuss a joint initiative for peace in Indonesian-controlled East Timor.
"There was a miscommunication with the United Nations and I must say the miscommunication appears to have been largely on our side," he told Reuters.
South African officials also acknowledged on Tuesday that the Portuguese government had lodged a formal protest against the expulsion last week of its ambassador in Pretoria, Vasco Valente.
Although there was no formal response from the South African government early on Tuesday, Foreign Ministry officials said they were aware that South African Ambassador Kingsley Makubela had been summoned to the Portuguese Foreign Office.
The Portuguese embassy in Pretoria confirmed on Monday that Valente last week was given 48 hours to leave the country.
Reuters - August 5, 1997 (abridged)
Lisbon – Portugal said on Tuesday it would not retaliate in kind after South Africa expelled its ambassador over the leaking of a misdirected letter from President Nelson Mandela.
"We have no intention of asking for the expulsion of the South African ambassador to Lisbon," Foreign Ministry spokeswoman Ana Zacarias told Reuters.
"The relations between Portugal and South Africa continue to be good," she said.
Portugal said on Monday it deplored the expulsion of its envoy to South Africa over the leaking of the Mandela letter, intended for Indonesian President Suharto.
Zacarias said that Portuguese ambassador Vasco Valente had thought that the letter was a copy for his consideration.
The Portuguese government called in South African ambassador Kingsley Makubela on Monday and asked him to explain the expulsion.
Zacarias said Makubela was expected to visit the foreign ministry in Lisbon later on Tuesday to deliver a "just explanation."
South African government sources said the incident had not permanently damaged relations with Indonesia or Portugal, but Valente's was the first diplomatic expulsion by Pretoria since Mandela came to power in historic multi-racial elections in 1994.
The Portuguese foreign ministry said on Monday that South Africa's decision was "incomprehensible," considering that the Portuguese president and government had responded positively to a Mandela initiative on East Timor.
In Pretoria at the end of last month, Mandela briefed Portuguese President Jorge Sampaio on his initiative to settle the dispute over the Pacific territory.
Reuters - August 4, 1997
Lisbon – Portugal said on Monday it regretted a decision by South Africa to expel its ambassador over the leaking of a misdirected note from President Nelson Mandela to Indonesian President Suharto.
"The South African authorities, alleging a misunderstanding between the Portuguese embassy and the South African presidency, last Friday (August 1) requested the departure from Pretoria of Ambassador Vasco Valente," a Foreign Ministry statement said.
"The ambassador, who had been due to leave Pretoria at the end of August, returned to Lisbon the next day," it added, saying Portugal regretted the decision.
South African government sources had earlier confirmed that the ambassador had been given 48 hours to leave.
It was the first time South Africa had expelled a diplomat since Mandela became the its first democratically elected leader in 1994.
The sources said Mandela had written to Suharto in mid-July, asking him to release East Timorese rebel leader Xanana Gusmao as a first step towards resolving the conflict there.
The letter was sent in error to the embassy of Portugal, East Timor's former colonial power, and was neither returned nor forwarded to the Indonesian embassy.
Mandela's proposal was leaked to newspapers in Portugal before Suharto was made aware of it and the incident bruised his attempt to bolster a United Nations effort to resolve the conflict over Indonesia's disputed rule in East Timor.
The South African sources said the incident had not permanently damaged relations with Indonesia or Portugal.
Mandela, whose own release after 27 years in jail opened the way in 1990 to a peaceful settlement in South Africa four years later, met Gusmao during a recent visit to Indonesia.
He has since invited Suharto to visit South Africa in November, following a proposed visit by East Timorese bishop and Nobel peace laureate Ximenes Belo in October.
Reuters - August 4, 1997
Brendan Boyle, Cape Town – South Africa has expelled Portugal's ambassador over the leaking of a misdirected note from President Nelson Mandela to his Indonesian counterpart, but diplomatic ties remain intact, government sources said on Monday.
Two South African government sources confirmed an Indonesian newspaper report that Portuguese Ambassador Vasco Valente had last week been given 48 hours to leave the country.
"This is in terms of international diplomatic protocols, which allow one country to object to a particular individual without affecting diplomatic relations in any way," one of the sources told Reuters.
"There has been a slight mistake on the part of one individual and he has been asked to leave," said the other.
South African foreign ministry spokesman Pieter Swanepoel declined to confirm or deny Valente's expulsion, saying: "We have no comment because this impacts on our relations with a third country."
Mandela's spokesman, Parks Mankahlana, said South Africa would not comment on any aspect of the incident over the misdirected letter, adding that it had since been received by Suharto and that the peace process was on track.
"It is something that has to be dealt with very cautiously. President Suharto and all the other parties must dictate the terms of forward movement, not President Mandela," he said.
"The President really sees this as a medium to long-term effort. It is not something that can be resolved quickly."
Radio Australia - 27 July, 1997
East Timor's Bishop Belo says he is declining an invitation to South Africa to meet President Nelson Mandela.
He says he has a lot of work to do in his dioscese and such a journey would be a waste of time.
Bishop Belo says that if President Mandela wants to talk about the politics of East Timor then he should talk to the Indonesian generals.
However, he did make some concessions to the President's interesst in finding a settlement for the problem saying his recent meeting with jailed East Timor independence leader Xanana Gusmao during a visit to Indonesia was a positive event.
Mr Mandela held talks in Pretoria on Friday with East Timor activist Jose Ramos Horta, who shared last year's peace prize with Bishop Belo, as part of a new initiative by U-N Secretary- general Kofi Annan to resolve the East Timor situation.
| Economy and investment |
Jakarta Post - July 31, 1997
Hendardi, Jakarta - Discussions about corruption have re-surfaced recently. This issue became topical during general election campaigning for members of the House of Representatives and the regional legislative assemblies. The three contesting parties boasted anticorruption themes and pushed for the eradication of corrupt practices. During a campaign speech, the general chairman of the functional group (Golkar), H. Harmoko, said the Edy Tansil case, involving a Rp 1.3 trillion loan scam, was uncovered by Golkar cadres. But he was reluctant to talk about a high-ranking official's informal note, allegedly linked to the scandal. Late last year there was a lot of fuss about Minister of Mines and Energy IB Sudjana reportedly having ministry funds in his name. Rumor had it that Rp 280 billion in funds, stemming from a contractor's concession of 13.5 percent of coal mining at PT Batubara Bukit Asam (TABA), went into the minister's private bank account. Some people surmised that the sums were deposited on the basis of Presidential Decree No. 21/1993. The problem is that the decree does not stipulate that money should be deposited into the minister of mines and energy's bank account. His ministry was also hit by the Busang gold mine scandal. Minister of Tourism, Post and Telecommunications Joop Ave was once alleged to have channeled Rp 30 billion into his private bank account. This money came from the government's dividend profits earned from the public listing of state-owned domestic telecommunications company PT Telkom. Joop Ave argued that the money was used for the construction of the statue of Garuda Wisnu in Jimbaran, Bali. The government later abolished such private bank accounts in a policy called the July 1997 deregulatory policy. The Indonesian Forum for Environment once queried the channeling of the forestry ministry's reforestation funds, amounting to Rp 400 billion, into the state-owned aircraft manufacturing industry PT IPTN. This interest-free loan was later converted into capital for the government's participation in IPTN. It was later reported that the forestry ministry allocated a stand-by loan facility worth Rp 250 billion. Forestry minister Djamaludin Suryohadikusumo stressed that a presidential decree had been issued regulating the improvement of the financial position of IPTN. (Panji Masyarakat, July 7, 1997) Other similar problems have cropped up. Members of the community were once stirred by fund-raising on the basis of a presidential instruction on backward villages. Now they are bothered by the establishment of partnership funds and a 2 percent levy to be imposed on those earning over Rp 100 million annually. Recently there has also been the problem of the sales of SEA Games stickers – Rp 1,000 per sticker – by the National Sports Council. Added to these are levies imposed on the businesspeople who manage to survive.
The Supreme Audit Agency (BPK) has revealed that the state's money has been manipulated in both central and regional government agencies. The agency has examined 338 cases. In the Ministry of Public Works alone, a case involving the accountability of over Rp 1.5 billion for a design review job has been uncovered. BPK can audit only 10 percent of the total Rp 101 trillion earmarked in the state's budget. In the meantime, the Development Finance Comptroller (BPKP) has detected many more cases. Last year the BPKP exposed over 15,000 cases which contributed to state losses totaling Rp 2.698 trillion. Unfortunately, BPKP could audit only 25 percent of the total number of cases, leaving the remainder untouched (Forum Keadilan, July 14, 1997) After BPK and BPKP exposed irregularities in the state's finances, BPK suggested that the government revise the Corruption Law to combat misuse of the budget. BPK's chairman, JB Sumarlin, doubted the effectiveness of the provisions in Law No. 3/1971 to eradicate corruption-related criminal acts. It is therefore interesting to ponder whether corruption is simply a legal matter or whether it is more of a political problem. Indonesia is endowed with abundant natural riches, including natural oil and gas, gold, copper, tin and iron deposits and forest produce such as timber and rattan. With all these resources, the New Order administration has built the country's economy and established political stability.
It is easy to guess that abundant riches concentrated in the hands of the government without well-thought-out plans and stringent discipline can easily be transferred into the hands of officials to accumulate their private wealth. When the government enjoyed windfall revenues from oil and gas, a program called "Industrialization to Substitute Import" (ISI) was devised. When all this "oil money" was spent on the program, ISI-based industries were still far from being competitive. Government ministries considered as "wet" (involving a lot of money) have given rise to the nouveau riche. Businesspeople close to high- ranking officials can easily obtain loans, subsidies, licenses and even protection and domestic market monopoly from the government. The relationship between officials and prospective businesspeople or those enjoying facilities and protection from the government is one of patronage. Certain government officials help facilitate and protect these businesspeople to build up their business empires. They obtain, in return for these position-related services, material incentives in the form of corporate shares, for example. Patronage must be seen as the most significant corruptive relationship in the New Order state system. To ensure that this system of patronage runs smoothly, government officials often under such a system enforce loyalty into the ranks of the bureaucracy. It is here that the way is paved for nurturing a bureaucracy's corruptive character. Therefore it is no wonder that in this country corruption is like an octopus whose tentacles are everywhere and at all levels: from the neighborhood association (RT) desks, for document processing, to those of high-ranking bureaucrats. Corruption is a plague that spreads endlessly. Even the Corruption Law is powerless to stop the plague. As I have often stated, corruption cannot be viewed from the legal standpoint as simply a matter of legal violation. Corruption must be seen as a political and economic matter. If the movement for political reform cannot thrive and grow strong, corruption will continue to be rampant in Indonesia. Corruption develops at all bureaucratic levels. So, the eradication of corruption cannot rely solely on the improvement of the Corruption Law. Political reform is needed to cleanse the New Order bureaucracy at all levels. This movement will not come as a gift from heaven but one we must be collectively fight for on Earth.
[Hendardi is executive director of the Indonesian Human Rights and Legal Aid Association (PBHI) in Jakarta.]
Wall Street Journal - August 7, 1997
Richard Borsuk, Mangakajang – Plywood baron Mohamad "Bob" Hasan, longtime confidant of President Suharto, has finally fulfilled his dream of building a huge, high-tech pulp mill in the jungle. Making it profitable, however, may take many years.
Even though the government is very likely to provide the $1.3 billion project with tax breaks, some paper and pulp industry analysts question how the mill will perform financially, given high infrastructure costs.
On Wednesday, Mr. Suharto officially opened PT Kiani Kertas, a 500,000 metric ton-a-year mill on the eastern coast of the island of Borneo. The remote mill, in a sparsely developed part of East Kalimantan, can be reached only using the airport or the port that Mr. Hasan has built for it.
Unusually, the ceremonial opening took place before the start of commercial production. Production had been scheduled to begin earlier this year but has been delayed by technical hitches. Kiani Kertas executives say all processes have been successfully tested, and commercial production is now scheduled to start Aug. 15.
Two dominant players
The mill is the largest single project undertaken by the 66-year-old Mr. Hasan, who has interests in timber, manufacturing, media and other businesses. He has long wielded influence because of his strong ties to Mr. Suharto, but only in the past year has Mr. Hasan consistently been in the public eye – after he bought 10% of listed auto assembler Astra International and later became its chairman.
For nearly 40 years, Messrs. Hasan and Suharto have been golfing partners. After Wednesday's mill opening, the pair went fishing off nearby islands.
In the early 1990s, Mr. Hasan, who basically controls the country's plywood industry as head of the producers association, made plans to move into pulp. Until now, the Indonesian pulp industry has been dominated by two players, the Sinar Mas Group and the Raja Garuda Mas Group.
This project hasn't come cheap. Mr. Hasan spent about $30 million to build a runway and airport that can accommodate small jets, and Kiani Kertas executives estimate overall infrastructure costs at about $100 million. Also, the mill cost more than originally planned and faces a hefty burden from interest on loans, they say.
About 90% of the mill's production will be exported, Kiani Kertas executives said. Long-term buyers have been secured for nearly all output, they added. One paper industry analyst said that while the commitments are critical, these are based on world pulp prices, which can fluctuate widely.
Tax request 'under consideration'
Mr. Hasan said he isn't worried about the mill's financial performance, and added that he is confident Kiani Kertas will be a low-cost producer in an industry with bright prospects. Without specifying a figure, he said interest payments "are a little high," but added he expects the cost to be reduced through a loan-restructuring. He also clearly expects some government largess. On Tuesday, Mr. Hasan first said that "most probably" Kiani Kertas will get some kind of tax incentives, and he later strengthened that to assert: "I know we will be able to get it." Indonesia's director-general of tax, Fuad Bawazier, who was present at Kiani Kertas's opening, said the company's request for help is "under consideration."
If a tax holiday is awarded, it would be the second time Kiani Kertas has benefited from government help. Last December, the president ordered the government's reforestation fund – created from fees paid by forest concessionaires – to lend 250 billion rupiah ($96.2 million) to Kiani Kertas. Critics of the loan said they believe Kiani Kertas needed money to finish the mill. Mr. Hasan denied this, saying the loan was offered because a state company is his partner in a timber estate supplying trees to the pulp mill. He said Kiani Kertas hasn't drawn any of the loan.
The businessman said his Kalimanis Group, which comprises many of his timber interests, owns most of Kiani Kertas. Some shares, he added, are owned by two foundations chaired by Mr. Suharto, although he didn't specify how much was owned by the foundations.
Setio Anggoro Dewo, Kiani Kertas's finance director, said that Mr. Hasan's group has directly put in $250 million in equity and supplied another $330 million in intragroup loans.
Other funding for the mill has come from Indonesian banks, which have lent $410 million, and a $120 million foreign-bank syndication. Gerry White, a Kalimanis executive, said foreign banks "initially couldn't see themselves clear to invest" in the project, so Mr. Hasan was "forced to go to local banks, which did a good job."
Pulp industry executives and analysts suggest that Mr. Hasan's entry into the pulp business may already be affecting plans of other companies. They say that Sinar Mas early this year canceled its plans for expanding a mill in Sumatra. Also, Astra International this year dropped its plans for a joint venture with Siam Pulp & Paper Co. for a pulp mill in East Kalimantan.
World Bank Press Release - July 28, 1997
Washington – World Bank loans to Indonesia are thoroughly supervised and audited to ensure that they are devoted to the poverty-alleviating purposes for which they are intended, the institution said today.
The Bank is refuting an allegation by an assistant professor at Northwestern University in the United States, Jeffrey Winters, who is reported as claiming in Jakarta yesterday that at least a third of World Bank loans to Indonesia "leak into the government bureaucracy and disappear".
"This is demonstrably untrue," said the World Bank's Vice- President for East Asia and the Pacific, Jean-Michel Severino. "We know exactly where our money is going. Worldwide we have very stringent standards for disbursement of our loans. If supervision of our projects produced any evidence of misappropriation or misallocation of our funds, we would take swift action to stop it. We do not tolerate corruption in our programs. On this principle there is no compromise."
"It is deeply regrettable," noted the World Bank's Jakarta-based Country Director for Indonesia, Dennis de Tray, "that our work for the people of Indonesia should be misrepresented in this way. The procurement of goods and services financed under Bank loans is conducted through open, transparent and competitive international procedures. Funds are disbursed only to suppliers of these goods and services under contracts approved by the Bank. There is full accountability on the use of Bank funds through a comprehensive system of independent ex-post financial audits of project accounts. The Bank itself carries out separate reviews on the use and development impact of its loan."
Mr. Severino said the Bank was puzzled by Mr. Winters' allegation. "We have checked his claim, which he has made in the past, and found nothing to support such an estimate."
"We have had a small number of projects rated unsatisfactory by the Bank's own assessment standards, but Indonesia retains one of the best records of successful project implementation of any of our client countries across the developing world," Mr. Severino added. "The results are there for all to see. Over a single generation, there has been a huge improvement in the living standards of the Indonesian people, and we are pleased to be a partner in this progress."
On Mr. Winters' claim that much information on Bank loans to Indonesia was non-existent or unavailable, World Bank officials said there was no secret about the amount of money lent to Indonesia or any other client country, with a full accounting of all loans being made in press releases, the World Bank's Annual Report and other public documents available through the Bank's Public Information Center. "I am surprised that Mr. Winters doesn't seem to know this," Mr. Severino noted.
The Vice-President added that the Bank was fully aware of international surveys suggesting that corruption was a problem in many countries, including Indonesia, and said the Bank was not only vigilant in protecting the integrity of its loans, but active in helping governments to implement national programs to discourage corrupt practices.
He said the Bank's latest World Development Report, entitled "The State in a Changing World", had much to say about good government being a vital necessity for development. The issue has been raised at the recent Indonesian Consultative Group meeting in Tokyo chaired by the World Bank, and recommendations on good governance have been made in the latest Indonesia country economic memorandum prepared by the Bank.
Indonesia and the World Bank
Indonesia resumed membership in the World Bank in April 1967; the Bank's mandate in Indonesia, as in all its borrowing member countries, is to support broad-based economic development and the reduction of poverty. Cumulative World Bank lending to Indonesia as of June 30, 1997, was approximately $24.7 billion. There are 78 projects currently being implemented, with a 91 percent satisfactory approval rating.
In FY97, World Bank lending to Indonesia totaled $914.6 million for 11 projects. Lending in FY97 focused on infrastructure and rural and social development, and was marked by an increased emphasis on decentralization and participation, with a number of projects having a regional focus and greater beneficiary participation. Loans for urban infrastructure development totaled $405.1 million; a railway efficiency project was approved for $105 million. Education loans totaling $273.2 million financed projects to improve quality of secondary education-particularly in rural areas-and higher education. In addition, loans were approved to finance two alternative energy power projects benefiting rural areas, a health improvement project, and an audit/financial management project.
Indonesia's development priorities, and therefore the focus of Bank support, have changed over the years to reflect a greater awareness of regional differences, a stronger commitment to deregulation, an increased role for the private sector, and greater attention to the quality of health and education, sustainable resource management, the urban environment, and institutional development. A major focus will be on improving regional capacities to plan, prepare and implement projects at the local level.
Jeffrey A. Winters - July 28, 1997
The World Bank has a public face and a private face. The public face I call the Rhetorical Bank. This is the part of the Bank we are all familiar with – the Bank that produces World Development Reports, gives advice, and applies pressure for structural adjustment. The Rhetorical Bank is the philosophical arm that preaches the wonders of the free market and encourages efficiency, liberalization, deregulation, and debureaucratization. The private face is what I call the Real Bank. This is the part of the Bank that designs projects, negotiates loans, and disburses the money. The power and substance of the World Bank is in the Real Bank, while the Rhetorical Bank takes care of public relations. Indeed, these two components are even separated physically at the Bank's headquarters in Washington, D.C. With few exceptions, the staff that work in the country missions, such as the Bank office in Jakarta, are part of the Rhetorical Bank.
The distinction between the Rhetorical Bank and the Real Bank is important for at least two reasons: first, because few people are aware of the Real Bank and even fewer understand how it operates, and second because the Real and Rhetorical Banks contradict each other in their functions and objectives. The Rhetorical Bank stresses a diminished role for the state in developing countries. The Real Bank, especially in places like Indonesia, has played the leading role in feeding state bureaucracies while displaying very little capacity and even less desire to channel project and development funds past or around the state apparatus. The Rhetorical Bank stresses efficiency, transparency, and accountability. The Real Bank focuses on moving as much money as possible (a "culture of approvals," as one internal Bank report put it), with virtually no effort to audit where funds go or how they are used. The Rhetorical Bank criticizes corruption. The Real Bank colludes with its clients to ignore rampant corruption of the Bank's own funds (which come primarily from taxes in industrialized countries). The Rhetorical Bank preaches about quality control. The Real Bank makes loan after loan for projects that are dysfunctional or severely mismanaged. The Rhetorical Bank portrays itself as an institution for development (especially when asking for more money from the U.S. Congress). The Real Bank says it is a bank and not a development agency.
Structural Problems The problems with the World Bank are deeper than mere schizophrenia. The reformer-President of the Bank, James Wolfensohn, has quickly discovered that the pathologies of the Bank are ingrained in its institutional apparatus, and worse, in the mentality of the staff in charge of loans and projects. Wolfensohn left Wall Street thinking he could take over the Bank and run it like a corporation. Instead, he realized that the Bank is more like an entrenched U.N. agency with a resistant hierarchy of bureaucrats who advance their careers within the Bank not by how much they accomplish with their loans (quality), but by how large their loan portfolio is (quantity). The internal Wapenhans Report, published in 1992, reviewed about 1,800 Bank projects in 113 countries and found that 37.5% had failed, adding that staff and managers "focus on lending targets rather than results on the ground." A 1996 audit by the United States General Accounting Office (GAO), the independent research arm of Congress, found no subsequent improvement. In fact, according to GAO data, because task managers for Bank projects report on their own progress and accomplishments (or use unaudited self-reports from client governments), the number of failed projects is actually 9% higher than the 37.5% figure in the Wapenhans Report. The word in Washington, D.C. is that Wolfensohn is frustrated with the Bank's resistance to internal reform, and wants to return to the private sector.
Collusion and corruption - The case of Indonesia
Indonesia is considered to be a "model" debtor country by the World Bank, and the Bank is very proud of the relationship it has built with Indonesia since the earliest days of the New Order. Indonesia needs the Bank to help continue the large annual injections of credit from the Consultative Group on Indonesia (CGI), while the Bank needs Indonesia as a showcase of lending and developmental success. As countries around the world fail or refuse to repay their debts, Indonesia can always be counted on to pay. Despite the fact that the Bank's figures on poverty reduction in Indonesia were "negotiated" with the Indonesian government (i.e., they were reduced significantly), the Bank puts its full credibility behind the official poverty rates in Indonesia without ever explaining how the number of poor in Indonesia was reached. And despite severe difficulties with some very high profile Indonesian projects for rural development and the environment, the Bank continues to refer to these projects as symbols of how the Bank is able to contribute to development at the grassroots level.
One of the most disturbing aspects of the World Bank's close relationship with the Indonesian government is that for three decades the Bank has allowed a large proportion of its loan funds to leak into the government bureaucracy and disappear. Although it would be disastrous for Bank staff to admit publicly that loan funds are routinely stolen in Indonesia, they quite readily admit privately that such leakage is substantial. In an interview on January 3, 1990 with Atilla Sonmez, the head of the Jakarta mission of the World Bank, I asked the following question: "How much of the Bank's loan funds to Indonesia never see the light of day?" Mr. Sonmez responded "about a third." Since then, half a dozen Bank officials, both in Jakarta and in Washington, D.C., have given the same rough estimate. Indeed, most have pointed out that 30-33% is a conservative estimate, and that such levels of theft and leakage are not uncommon in developing countries like Indonesia.
It is interesting to note how the World Bank has responded to this charge (which was published in a column I wrote in the Far Eastern Economic Review on February 13th, 1997). Rather than deny the estimate of corrupted Bank funds, Michael Walton, chief economist for East Asia and the Pacific for the World Bank, stated: "While we do not know what an estimate of a 30 percent rakeoff in Indonesia is based on, we are well aware of the problem of corruption." This is a particularly revealing statement. First, the Bank is admitting that it is aware that its funds are being stolen. Second, the Bank is saying that it does not know what the 30 percent corruption rate is based on. Both statements are true, in fact. The reason Bank staff conservatively estimate the amount of lost funds in Indonesia (or elsewhere) is because the Bank does not collect and report data on such theft. Oversight of World Bank loans is minimal, and independent auditing is almost nonexistent. In other words, the Bank knows money is being stolen, its staffers have a general sense of how large the problem is, but there is no concrete data on such theft because the Bank does not collect such data. In short, the World Bank has a global policy of "don't ask, don't tell."
When I asked Mr. Sonmez back in 1990 if the level of leakage in the Indonesian system was disturbing to the Bank, he responded nonchalantly that Indonesia repays its debts on time and that it is not the Bank's business or role (as a bank) to follow the money and make sure it is used properly by its clients. Several staffers at the World Bank have made the same argument to me during the years since (most recently in November 1996 at World Bank headquarters in Washington, D.C.).
Conclusions and recommendations
1. The World Bank should be encouraged to overcome its schizophrenia by reforming its lending and its management of project quality. In other words, the primary consumer of the Rhetorical Bank's advice about efficiency, transparency, quality control, and streamlining should be the Real Bank itself. There are two broad ways of achieving this: a strong and detailed internal system for oversight should be created (where promotion and career advancement is based on how many bad projects are detected, reformed, or eliminated); or a strong external body should be created that examines and oversees the Bank's operations and projects. This external body should be given the power to cancel Bank projects found to be mismanaged.
2. The World Bank should insist on much greater involvement by independent organizations and groups in borrowing countries. These local actors can assist the Bank as watchdogs that have a much greater capacity (and motive) to detect fraud and mismanagement. More importantly, these organizations should deal with Real Bank staff, not with Rhetorical Bank staff (as is the current practice).
3. The World Bank should begin immediately to assess how much of the total amount of World Bank loans to Indonesia have been corrupted or stolen. Upon determining the level that has leaked into the bureaucracy, that amount should be forgiven. The rationale for this recommendation is simple: since the World Bank supplied funds in an on-going way that it knew were not being used for their intended purpose, it is unfair that the Indonesian society (especially the poor) should be responsible to pay these funds back (with interest). If the average Indonesian received only two-thirds of the loan funds from the World Bank, why should they be required to pay back 100% with interest? The average Indonesian does not have the power to impose limits on the actions of government officials. But the World Bank does have the leverage, and it should begin to use it immediately.
[Jeffrey A. Winters is an Associate Professor at the Northwestern University, Department of Politics]
| Miscellaneous |
Agence France Presse - August 6, 1997
Manila – Indonesian opposition leader Megawati Sukarnoputri wants to visit the Philippines but is uncertain if the government of President Fidel Ramos will allow her in, a local newspaper reported here Wednesday.
"I have plans of visiting the Philippines but I don't know if the Philippine government will allow me," Megawati was quoted as saying in the Manila Times newspaper.
The Philippine and Indonesian governments had strong ties and Ramos and Indonesian President Suharto were "close allies," she was quoted as saying.
Megawati, who was ousted from the leadership of the Indonesian Democracy Party (PDI) in 1996, reportedly due to government pressure, did not say why she wanted to visit the Philippines. The Philippines and Indonesia have close relations with Indonesia helping to broker peace talks between the Philippine government and Moslem separatists in the south.
However, in recent years, local opposition groups have been hosting East Timor independence activities in this country and tried to bring in leaders of the East Timor movement.
Such moves have complicated relations between the two countries with Jakarta urging Manila to ban the entry of the East Timor activists.
Indonesia invaded the former Portuguese colony of East Timor in 1975 and annexed it a year later in a move never recognized by the United Nations. A separatist movement has been fighting the Indonesian presence ever since.