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ASIET Net News 33 – August 18-31, 1997
South China Morning Post - August 20, 1997
Jenny Grant, Jakarta – The National Commission on Human
Rights intervened yesterday on behalf of 14 students detained for
holding a protest on Indonesia's national day.
"We have rung the Bogor police and requested that they release
the students. We told them they made a mistake," said retired
Major-General Koesparmono Irsan, a member of the commission and
former deputy national police chief.
Eleven students were arrested on Sunday morning during a four-
kilometre march through central Bogor, 60 km south of Jakarta,
marking 52 years of Indonesian independence from Dutch colonial
rule.
The students handed out paper flowers and carried banners with
anti-government slogans. The banners accused the Government of
ignoring human rights and of cheating during the May general
elections.
Witnesses said authorities stopped the march. The students had
their banners seized and were attacked by police, they said.
According to a statement from the Youth Front to Uphold the
Rights of the People (FPPHR), which organised the action, a 15-
year-old high school student sustained head injuries when police
hit her. Bogor police arrested two more students involved in the
rally at their homes late on Monday.
Bogor police yesterday said they were holding only 11 students.
One officer said police were interrogating the students but had
not yet charged them.
Local activist Pius Lustrilanang said the police saw the
demonstration as a threat to state security.
"Our Government has a security policy, so they don't want to take
a risk and let people on the street express their opinion," he
said.
The FPPHR statement alleged that Bogor police chief Colonel
Dadang Garnida led the attack on the students. Colonel Garnida
told the Jakarta Post yesterday that he was disappointed the
students had spoken out against the Government.
"While all Indonesians were celebrating the country's 52nd
Independence Day anniversary, these men signed a protest
discrediting our own Government," he said.
The Human Rights Commission said it would investigate the
incident.
Sydney Morning Herald - August 23, 1997
Louise Williams, Jakarta – President Soeharto will not
approve the release of the jailed East Timorese guerilla leader,
Xanana Gusmao, despite the recent plea by the South African
leader, Mr Nelson Mandela. A senior Indonesian official said Mr
Soeharto would write to President Mandela and "clearly point out
that he cannot release Xanana because he is a criminal and not a
political prisoner", the Jakarta Post reported.
Mr Mandela wrote to Mr Soeharto after meeting Xanana during his
visit to Jakarta last month, saying the release of all political
prisoners, including the former leader of the Fretilin movement,
was essential to "normalise the situation in East Timor".
Mr Mandela's meeting with the 51-year-old Xanana was approved by
Mr Soeharto, and marked the beginning of efforts by the South
African leader to broker a peace settlement in East Timor,
annexed by Indonesia in 1976.
The Indonesian official said Mr Soeharto would pay a reciprocal
visit to South Africa in November, despite his refusal to release
Xanana. "President Soeharto respects President Mandela as a great
statesman and trusts his sincerity in assisting Indonesia in
finding an international solution on East Timor," he said.
But Indonesia assumed the efforts would be based on "quiet
diplomacy" - a disapproving reference to the leaking to the media
of the Mandela letter to Mr Soeharto.
East timor
Human rights
Environment/land disputes
Arms/armed forces
International relations
Economy and investment
Miscellaneous
Democratic struggle
Rights group seeks release of students
East timor
Resistance leader to stay in prison, rules Soeharto
Jail terms sought for 14 more Timorese protesters
Reuters - August 27, 1997
Jakarta – An Indonesian court has been asked to sentence 14 East Timorese to one year in jail for taking part in an anti- Indonesia protest during a visit by a U.N. envoy in March, the official Antara news agency reported on Wednesday.
Government prosecutors urged the Dili State Court in the East Timor capital to jail the defendants for separatist activities, by protesting outside a hotel where U.N. special envoy Jamsheed Marker was staying.
A total of 33 East Timorese youths were arrested during the protest. On Tuesday, prosecutors asked the same court to sentence 19 East Timorese to one year in jail each on the same charges. Antara gave no further details.
Residents said demonstrators tried to meet Marker over frustrations that he was to see only government officials and Nobel Peace laureate Bishop Carlos Belo during his three-day visit to the territory.
Indonesia invaded East Timor, a former Portuguese colony, in 1975 and annexed it the following year in a move not recognised by the United Nations.
Armed guerrillas in the hills of East Timor and a clandestine movement in urban areas still oppose Jakarta's rule.
On Monday Indonesia dismissed a proposal from a rebel leader to give East Timor a relationship with Jakarta similar to that which Puerto Rico enjoys with the United States.
Puerto Rico has almost total autonomy in its affairs with just foreign relations and defence the province of the U.S. government.
Reuters - August 25, 1997
Jakarta – Indonesia dismissed on Monday a proposal from an East Timor rebel leader for the former Portuguese colony to have a similar relationship with Jakarta as the United States shares with Puerto Rico.
In a message recorded in the mountains of East Timor and broadcast on Portuguese television on Friday, Konis Santana said his rebel movement would accept the transformation of East Timor into a state associated with Indonesia, in the same way as Puerto Rico is linked to the United States.
Puerto Rico has almost total autonomy with just foreign relations and defence the province of the U.S. government.
"We take the view that any solution which gives the people of East Timor the right to exercise self-determination is acceptable," Santana said in the broadcast. "Puerto Rico forms a viable working model."
However, Indonesian Foreign Ministry spokesman Ghaffar Fadyl dismissed the proposal and questioned Santana's credentials.
"Who does he represent? He represents a minority which is not satisfied with the integration (of East Timor into Indonesia), but he certainly does not represent the majority of the people of East Timor," Fadyl told Reuters.
Fadyl said the two existing U.N.-sponsored forums on East Timor – the tripartite talks between Indonesia and Portugal and the All-Inclusive East Timorese Dialogue (AETD) – were the place for any new proposals.
"If any solution can be found, it will done be through the tripartite talks and the AETD," Fadyl said.
"They are free to propose, they are free to say what they want, but will it be practical? Will it be something useful? It's nothing new. It is the same thing over and over again," he said.
The United Nations has never recognised Indonesia's 1976 annexation of East Timor eight months after Jakarta invaded the enclave, and considers Portugal the administering power.
Foreign military analysts estimate the poorly armed rebel movement has only a few hundred fighters in the rugged hills of East Timor and that it is supported by an urban- based clandestine movement numbering in the thousands.
East Timorese resistance leader says he could accept a Puerto Rico's solution for the territory.
Tapol - August 23, 1997
[On Indonesia's Independence Day, Sunday 17 August 1997, TEMPO Interaktif met Xanana Gusmao at Cipinang Prison in Jakarta. He is known to his friends as 'Mas Gus', even though he is not from Java. He looks young for his 51 years even though he has now a few grey hairs. 'I keep fit here,' he said. As part of the events to celebrate independence day, he took part in a soccer competition between teams of prisoners, both as coach and player. The team he led won and was given the cup by Justice Minister Oetojo Oesman. Here are extracts from the interview, supplemented by answers given in writing on the next day.]
What is the significance to you of this day?
This shows us that we are entitled to our independence and reminds us to continue to fight until we win independence for East Timor.
Can you explain what you mean by independence for the people of East Timor?
Independence from Indonesian colonialism. We haven't yet succeeded in winning it.
What do you hope for from the Indonesian Government for East Timor?
What I would like is for the Indonesian Government to pursue a correct policy, an open policy. We colonize but we say that we don't colonize. We murder but we say that we don't murder.
Can you explain what you mean?
They went there, took the army there and murdered people but they say that they didn't do any of these things. It's just a huge lie.
Hasn't the Indonesian Government yet done what the people of East Timor want?
There have been no results. We don't need bridges.
What were your feelings when you met President Mandela?
I felt happy that our struggle has his support.
How long did your meeting with Mandela last?
I don't know because I wasn't wearing my watch.
Was it just the two of you? No. There were three of us, because we were accompanied by Lopez da Crux (Indonesia's special ambassador).
In your opinion, is the participation of East Timorese in celebrations for Indonesian independence based on genuine feelings?
Whenever senior officials come from Jakarta, the village head or residential head, or traditional leaders are told to mobilise people to welcome them. The local army and police chiefs threaten the village administrators, ordering them to mobilise the people. If they don't participate, they will be accused of being two- faced and will be placed under scrutiny. Their economic activities will be destroyed.
Would you say that young East Timorese who are accused of humiliating Indonesia abroad should not be described as nationalists?
I don't think their aim is to humiliate the new order abroad. This regime humiliates itself, and sometimes the Indonesian people are also forced to feel ashamed.
They also deceive the Indonesian people and try to convince the world with twisted information. This is very shameful indeed. It's not the East Timorese youths who are putting the Indonesian government to shame.
What is the right way to handle these critical young people?
They only way is for the government to listen to their political aspirations.
What in your opinion will the future bring for East Timor?
We will pursue a good-neighbour policy. We will join ASEAN. But we will never consider entering into any security pacts.
What do you think about the idea of granting special status to East Timor?
There is nothing in the Indonesian Constitution about the special status some people seem to want. They want special status with rather broad powers for the regional administration. They think in terms of a special status that is more than in Aceh and Yogyakarta. But there is nothing about such a thing in the Indonesian Constitution. The people of East Timor are fighting for independence, not for a special status like Aceh or Yogyakarta.
Are you still convinced that the question of East Timor will be resolved by a referendum?
It's not a question of my being convinced. This is a basic matter of principle as provided for in the United Nations, and it must be upheld by everyone. Without a referendum, the question will never be solved.
There are reports that you are going to be released. Yes, I read reports about that in a newspaper, but I dont take too much notice of the issue.
Reuters - August 16, 1997
Jakarta – Indonesian Justice Minister Utoyo Usman said on Saturday the government had given a three-month reduction to the jail term being served by East Timorese rebel leader Jose "Xanana" Gusmao, the Antara news agency reported.
Gusmao was given a three-month reduction because of his good conduct, Usman said, adding that the rebel leader was among the 16,000 inmates whose sentences were reduced ahead of independence day on Sunday.
Gusmao, who was sentenced in 1992, would be released after 2000, Usman was quoted as telling reporters after attending President Suharto's speech to the nation on the eve of the country's 52nd anniversary of independence from the Netherlands.
The official news agency gave no further details.
Gusmao is serving a 20-year jail sentence at Jakarta's Cipinang jail for resisting Indonesian rule in East Timor, a former Portuguese colony that Indonesia invaded in 1975 and annexed the following year in a move not recognised by the United Nations.
The Kompas newspaper quoted Usman as saying on Friday that the government did not plan to release Gusmao any time soon and that his name was not among the inmates whose jail sentences would be reduced.
Rumours about Gusmao's release appeared after last month's state visit by South African President Nelson Mandela.
During the visit, Mandela secured the temporary release of Gusmao and dined with him at the government guest house.
Mandela later sent a letter to Suharto suggesting Gusmao be released to better the prospects for a settlement of the East timor problem.
But government officials have reiterated that Gusmao was in jail for criminal offences and not because of his political beliefs.
| Human rights |
Agence France Presse - August 28, 1997 (Extracts only)
Jakarta – The subversion trial of Indonesia's independent labour leader Muchtar Pakpahan, set to resume Thursday after a six-month break due to illness, was postponed to next week because of ill health.
'We cannot proceed with the case if the defendant is not ready', said South Jakarta district court judge Djazuli Sudibyo, who presided over the case. The judge suspended the session after 15 minutes when he confirmed that Pakpahan was too weak to stand trial. He said the case will resume next Thursday.
A pale-looking Pakpahan, assisted by two people into the packed courtroom, rested his head on the desk soon after he sat down.
Dr Ramli, a doctor from Cikini Hospital where the labour leader has been treated since 1 March, accompanied Pakpahan to the court and said that his patient was suffering from vertigo.
Pakpahan's lawyer, Lutfi Hakim expressed his disappointment with the authorities who insisted on transporting his client from prison to the court in a small non-air- conditioned prison minivan instead of Pakpahan's private car.
'He was fine when he went in his own car from the hospital to prison. But it was during the trip from the prison to the court that Muchtar started feeling ill,' Hakim said after the session.
Pakpahan's subversion trial, which started last December. was suspended after he entered hospital in March. His repeated requests to go abroad to seek medical treatment for a benign tumour on his right lung have been rejected by the government.
Asiaweek - August 24, 1997
Peter Morgan and Keith Loveard, Jakarta – Muhammad Syafruddin was beaten to death with an iron bar outside his house in Jogjakarta on August 13, 1996. Police say he was killed by his lover's jealous husband. They made no connection between the murder and an article that the 33-year-old journalist had recently published in Bernas which claimed that local officials had siphoned off aid meant for Indonesia's poor.
About a year later, reporter Muhammad Sayuti Bochari was found lying unconscious on a road outside of Ujung Pandang in South Sulawesi. He later died in the hospital. Witnesses say he looked as if he had been beaten, but police maintain he fell off his motorcycle as he swerved to avoid a truck. Two days earlier his article in the Pos Makassar had charged local government workers with embezzling development funds meant for impoverished villages.
Naimullah, 42, a reporter for Sinar Pagi, was found dead in the back seat of his car in West Kalimantan last month. He had stab wounds in his neck and bruises on his temple, wrists and chest. Four men were seen running from the scene. Police have called his death a traffic accident. They see no link between it and a recent story of his that exposed a timber-smuggling racket in the province.
Morbid coincidence or a deadly form of media censorship? The New York-based Committee to Protect Journalists believes that Syafruddin was killed because of his expose. The committee blames the Indonesian government for its hostility toward independent media. "If the government treats critical journalists like enemies, it makes sense that thugs at any level feel free to do the same," says A. Lin Neumann, the committee's Asia expert.
The violence has not silenced the country's press. The Indonesian Journalists' Association (PWI) has condemned the police responses to the deaths, particularly those of Naimullah and Syafruddin. For the first time, the PWI has launched its own investigations. Some reports have already tied Syafruddin's beating to corrupt local officials.
The police have their own suspect. They allege that Dwi Sumaji killed Syafruddin when he discovered the reporter was having an affair with his wife. But when Sumaji took the stand Aug. 5 he claimed the police had bribed him to take the blame. "I have been sacrificed to protect a political mafia," he told the court.
Meanwhile, the PWI has published Udin's Blood, a collection of the reporter's stories. "It reveals that he was a fighter," says Parni Hadi, head of the association. If Syafruddin's death was a result of his reporting, then the journalists' fight is much more bloody than it should be.
Kompas - August 25, 1997 (posted by Tapol, summary only)
The subversion trial of SBSI chairperson Muchtar Pakpahan is scheduled to resume on Thursday, 28 August. The trial has been adjourned for five months because the defendant fell ill.
Two members of Pakpahan's defence team, Bambang Widjojanto and Luthfie Hakim confirmed to Kompas that the trial would resume. The presiding judge Djazuli Pranoto Sudibjo issued a letter on 18 August stating that the trial would resume on 28 August. The letter instructed the Public Pprosecutor's office in Jakarta to make arrangements for the defendant and witnesses to appear in court.
The public prosecution office has sent a letter to Cipinang Prison authorities to make the necessary arrangements for the defendant to appear. A copy of the letter has been sent to the Director of Cikini Hospital where Pakpahan is still under treatment.
Jakarta Post - August 16, 1997
Jakarta – Observers criticized as inappropriate and groundless a motion to reintroduce a People's Consultative Assembly (MPR) decree that would give a president extra power.
Constitutional law expert Harun Al Rasyid and political analyst Deliar Noer separately expressed opposition against the campaign by House of Representatives legislators to revive the 1988 MPR ruling on preemptive security measures.
"It isn't necessary to legalize the President's authority to take preemptive security measures through an MPR decree," Harun told The Jakarta Post yesterday. "Do they think the country isn't safe for people to live in anymore?" Deliar said. "What this country needs is ordinary regulations because its situation is normal."
The decree granted the President the authority to take preemptive measures against security disturbances and subversive activities. It was adopted as part of Indonesia's Broad Guidelines of State Policies in 1988, but was later dropped from the guidelines in 1993. The ruling Golkar, the United Development Party (PPP) and the Indonesian Democratic Party decided recently to include the substance of the 1988 decree in their drafts of the 1998 state guidelines.
Harun pointed out that there was a universally accepted principle that a head of state has emergency powers that authorized him or her to take preemptive security measures.
The decree was first adopted in 1966 and maintained until the 1988 general session of MPR. It formed the basis for the establishment of the now defunct Kopkamtib (Operational Command for the Restoration of Security and Order) which, in the 1970s, was given the task of handling major social and political crises. The body was not only successful in fulfilling its objectives, but was also feared.
Harun said the existing Criminal Code and the 1963 Subversion Law actually had provisions that allowed for such preemptive measures. Deliar turned his criticism toward the legislators whom he said were not independent in their handling of state affairs. He said legislators might feel inferior before the executive branch of power, namely the President.
"They should realize that their power is equal to that of the executive branch," he said. Some political observers previously expressed concern about the possible reintroduction of the decree, saying it would give a president even greater authority than what the Kopkamtib had in the past.
Separately yesterday, Golkar's secretary-general Ari Mardjono reaffirmed his organization's support for the reintroduction of the decree. "It's necessary to give the President the authority to take preemptive measures because we will face even greater security risks and challenges in the future," he said.
He admitted that the call to reintroduce the decree actually came from President Soeharto when he opened a training course for legislators last week. Harun said he suspected that more than a "precautionary security motive" was behind the reintroduction of the decree.
"The decree was dropped in 1993. Why reintroduce it for next year's meeting of MPR?" he said. Deputy chairman of PPP Jusuf Syakir said the 1988 decree was dropped in 1993 because none of the five factions in MPR requested its reintroduction. He said PPP would bring the issue up at a party meeting soon.
Republika - August 19, 1997 (Summarised posting by Tapol)
Four lawyers organisation, the legal aid institute, YLBHI, the Association of Indonesian Advocates AAI, the Indonesia Bar Association (Ikadin) and the Association of Legal Advisers (IPHI) have called on the leadership of Parliament to postpone discussion of the draft Police Bill.
Discussions of the bill have failed to involve the community and have taken place behind closed doors. 'The ideas behind the bill need to be discussed openly, involving the universities, professional organisations and the public at large,' they said in a statement.
They were unable to meet the chair of Parliament, Wahono who refused to see them but met a leader of the PPP group. The lawyers, pleaded with the parliamentarian to postpone discussions, but were told that this would be extremely difficult because of the pressures of time. [The present Parliament is under orders to adopt the bill before it is dissolved at the end of September. The Parliament has several other bills to adopt, including the highly controversial Labour Bill. TAPOL.]
Although the draft has now be amended to exclude an article that would have allowed police to use violence during interrogations, the lawyers organisations said they felt this revision was insufficient. 'A number of very basic problems still remain,' said Bambang Widjajanto, director of the YLBHI.
These include the need for greater limits to the powers of the police which are far too excessive, while the public has no way of exercising control over the force. It is far from adequate to rely upon the police code of ethics, pre-trial hearings and the role of superior officers to exercise control over police authority.
The bill also only focuses on human rights violations committed by the general public, without focusing also on the abuses committed by officials. The lawyers also want the police to be removed from the Armed Forces (ABRI) because of the basic difference between the philosophy of the police and the army. The role of the police is to protect and defend the community while the military has the task of dealing with enemy forces.
| Environment/land disputes |
Amnesty International - 26 August, 1997 (abridged)
Attempts by the Indonesian security forces to quell disturbances which began on 21 August 1997 in the Timika area of Irian Jaya - Indonesia's easternmost province - have resulted in two local tribespeople being shot dead and 15 others being beaten, in some cases severely. Among those beaten were eight people belonging to the Ekari tribe: Yulius Petege, Yahya Pigome, Ben Kotouki and five others were walking towards Timika airport on 22 August when they were reportedly beaten by police and taken away in buses. There is no further information on their whereabouts and there is concern that they may be at risk of torture or ill-treatment in custody.
Background information
The latest clashes between local people and the security forces in the troubled area around the US-owned PT Freeport Indonesia Mine at Tembagapura were sparked off by an incident in which two local people died and two were injured after apparently falling or jumping from a truck owned by Freeport on 20 August. A spokesman for Freeport quoted by Agence France Presse claimed that the two were victims of a traditional tribal execution. Local people believe that the deaths require independent investigation. The deaths fuelled existing high levels of tension in the area between local people and Freeport over the disbursement of a trust fund set up by the firm to help tribunal communities in the area.
On 21 August local people set up a blockade near Timika Airport to protest about the deaths. Some groups broke away from the blockade and marched towards the town of Timika Indah where they attacked the houses of Freeport employees. The following day the blockade continued. Meanwhile, two groups of people belonging to the Moni tribe marched to Timika to the office of the local regent to press their rival claims to the Freeport trust fund. A quarrel broke out between them, prompting troops from the 733 Patimura Infantry Battalion and members of the police force to beat the protestors with guns and clubs. Seven people are reported to have been injured in this clash; no one is reported to have been arrested.
In another incident on 22 August two people are reported to have been shot dead when a crowd approached Timika police station to demand an investigation into the deaths of Nela Pakage and Akuilan Kotouki (the deaths linked to the incident involving the Freeport truck, above). Passing the place where Nela Pakage's body had been found, youths in the crowd threw stones and shot arrows at troops guarding the spot. The troops opened fire, hitting Stevanus Tekege (23) in the head and Timotius Koga in the stomach. According to some reports the troops had been using rubber bullets.
Indonesia's National Commission for Human Rights (Komisi Nasional Hak Azasi Manusia - Komnas HAM) has announced that it will investigate the latest violence in Timika and other longstanding problems in the area between local people and Freeport.
Opposition to Indonesian rule of Irian Jaya, both peaceful and armed, has continued since authority over the province was transferred to the Indonesian Government in 1963. Protests, some involving the Free Papua Movement, Organisasi Papua Merdeka (OPM), a group advocating independence for the province, have included armed clashes with the Indonesian Armed Forces, flag- raising and peaceful demonstrations.
The Indonesian authorities have responded to the opposition with widespread human rights violations including arbitrary arrests, "disappearances", extrajudicial executions, torture and the imprisonment of prisoners of conscience.
In recent years the issue of land and resources, particularly around the PT Freeport Indonesia Mine at Tembagapura, has generated discontent. This has focused particularly on the perceived lack of benefits to the local community from the Freeport mine and the social and environmental impact of the mine's presence. In response to mounting protests both nationally and internationally, Freeport set up a trust fund representing 1 per cent of the mine's profits to be distributed among local communities. Local church leaders have recently published a statement demanding that Freeport postpone and review any further disbursements under the fund because it is creating tension among local people.
Wall Street Journal - August 22, 1997
Jakarta – One villager was killed and three soldiers were injured when tribesmen used bows and arrows to attack an Indonesian army patrol near the Freeport copper mine in New Guinea on Friday, a military source said.
The incident took place outside the town of Timika, about 3,320 kilometers east of Jakarta, near the Freeport Indonesia copper mine operated by Freeport-McMoran Copper and Gold Inc. (FCX) of New Orleans.
The mine is in the mountainous center of Irian Jaya, the western half of New Guinea island, governned by Indonesia.
An army officer, who spoke on the condition of anonymity, said the tribesmen shot arrows at a group of troops, injuring three soldiers.
One soldier shot dead one of the attackers.
Earlier, Indonesian troops broke up a demonstration of several hundred people who had blockaded a main road near the mine.
The group had been protesting about the deaths of two of their kinsmen on Wednesday. They claimed the pair were killed after they hitched a ride with a truck belonging to the mine.
A Freeport spokesman, Ed Pressman, denied the mine had been involved in the men's deaths.
Another group of people later staged a noisy protest outside the home of the local government chief.
Sydney Morning Herald - August 23, 1997
Louise Williams, Jakarta – From the air, the great rainforests of Borneo have disappeared under billowing clouds of smoke from hundreds of forest fires raging out of control, forcing planes to abandon their attempts to land.
On the ground, cars and motorbikes are picking their way through the eerie gloom, their headlights blazing, pedestrians are clutching wet towels to their faces and visibility has fallen to as little as 50 metres.
Thousands of kilometres away, the high-rises of Kuala Lumpur are shrouded in thick haze and residents have been advised to wear surgical masks and stop exercising outdoors as the smoke from western Indonesia's burning forests drifts northwards.
Already Indonesian forestry officials estimate that at least 16,000 hectares of one of the world's most important rainforest tracts is on fire in eight provinces on the islands of Borneo, Sumatra, Sulawesi and Maluku. Indonesian officials have announced a "maximum alert", but have insufficient equipment or expertise to do much more than watch the fires burn. The smoke is fast becoming a diplomatic issue as Singapore and Malaysia choke under the haze, and the destruction of large tracts of rainforest is further damaging the vulnerable ecosystems of Asia's rapidly shrinking "lungs".
Since the early 1980s, when logging companies accelerated their operations in the world's second-largest rainforest reserves in Sumatra and Kalimantan, on the island of Borneo, forest fires have become an increasingly serious regional health and pollution issue. Visually, the smoke is causing aviation chaos but more worrying is the impact of particulate pollution, which is being blamed for respiratory illnesses, eye irritations and asthma, especially in children.
In their natural state, tropical forests hold vast quantities of moisture from heavy wet season rains, which support them through the hot, dry months. But relentless logging, as well as nomadic slash and burn cultivation, has already drastically altered the topography of much of Borneo and Sumatra, leaving vast areas denuded, shrinking critical watershed areas and reducing dense, towering forests to kindling.
Dry season burning off to prepare for rice planting, as well as the use of fires to clear land and dispose of wood offcuts, engulf Indonesia and its northern neighbours in a choking haze almost every year.
This year, Indonesia is facing a severe drought and already experts have predicted a long hot dry season due to the El Nino weather pattern. "There are no clouds in the sky but it is almost dark in the middle of the day because of the smoke," said one visitor to Samarinda, on Kalimantan's east coast, who has been unable to travel further inland.
"The planes haven't been able to fly for a week and people are really worried," said Jailani, a Samarinda resident.
He said the city had only two weeks' supply of clean water because logging operations had denuded much of the watershed, which meant wet season rains drained quickly out to sea. Lakes and ponds, previously fed by the slow leeching of the wet season rains through the forests, had now dried up.
"Nowadays if you travel even 500 kilometres upstream you cannot see primary forest. It has all been cut. If we don't get rain within two weeks we will have nothing left to drink."
Forestry experts say the usually moist rainforests have become vulnerable to fire due to a process of "conversion" caused by logging and clearing. Opening up rainforests introduces sunlight to the forest floor, which was previously shaded by the dense tropical canopy. Sunlight encourages potentially flammable grasses and shrubs to invade the tropical forest, and they are easily ignited during burn-offs.
At the same time, clear felling of rainforest areas encourages the rapid growth of grasses which become brittle and dry during the hot months and are highly flammable.
Earlier this week the Indonesian national airline, Garuda, attempted to fly to Pontianak in West Kalimantan but was forced back to Jakarta. All regional airlines later announced cancellations across Kalimantan and parts of Sumatra where towns were no longer visible from the air and the sight range was well below the minimum 2,000 metres.
In 1966, 82 per cent of Indonesia's total land mass was covered by primary forest. By 1982 the area had shrunk to 68 per cent and recent satellite photographs indicate forest cover is now about 55 per cent, including timber plantations. About 64 million hectares, or one-third of Indonesia's total land mass, is covered by commercial logging concessions.
Last year Indonesia became the world's biggest plywood exporter, according to official statistics, and more than 30 per cent of all concessions are controlled by 10 companies with close political links to the Soeharto Government.
Straits Times - August 21, 1997
Jakarta – Re-evaluated plans for Indonesia's nuclear power plant programme will be unveiled next March after the National Atomic Energy Agency (Batan) completes a study on the country's energy supply and demand needs, The Indonesian Observer reported yesterday. "We are currently carrying out the re-evaluation of the nation's supply and demand for energy," Batan director- general Iyos Subki said after a seminar here.
"The re-evaluation is to assess whether the domestic supply and demand of energy sources would be balanced."
The government has announced that it would postpone the construction of a nuclear- power plant until at least 2020.
Research and Technology Minister B. J. Habibie has said that Indonesia would resort to using energy from nuclear power only as a last resort.
He argued that the discovery of several natural gas sources in the Natuna Islands, Irian Jaya, Kalimantan and other provinces, has meant that Indonesia could delay resorting to nuclear power – scheduled originally to come on stream in 2003.
But Mr Subki was quoted by the Indonesian Observer as saying that despite the decision to postpone the construction of such plants, the government was continuing with the preparation of human resource development in the nuclear field.
State-run Batan has been assigned the task of developing Indonesia's human resources in a move to anticipate the demand for nuclear power.
"Don't forget, nuclear power is very important technology because it has proven to be economical and safe to humans and the environment... for the last 30 years," said Mr Subki.
He noted that there were already 443 nuclear power plants operating worldwide, and another 36 under construction in Europe, China, Korea and Japan.
Indonesia previously announced plans for the construction of a 1,800-megawatt nuclear power plant on the slopes of the dormant Muria volcano on the north coast of densely-populated Central Java.
It would be the first of 12 in central Java, which would have a combined power generation capacity of 7,000-megawatts.
The government's plans have, however, met with strong criticism from many sectors because of the potential environmental and other dangers associated with nuclear power.
Asiaweek - August 24, 1997
Catherine Shepherd and Keith Loveard, Jakarta – In Indonesia these days, many people are holding their breath in more ways than one. For two months now, sections of the country have been enveloped in a dark gray haze. Airports on several islands have been closed when the smog made landing too dangerous, and in early August, visibility in the Sumatran city of Medan went from the normal four kilometers to 200 meters. Recounts a recent visitor: "I was horrified we were going to land under such conditions. You couldn't see the runway at all."
Parts of Malaysia and Singapore are also immersed in the same unhealthy haze, which is created every year by man-made forest fires in Indonesia. Malaysia's Ministry of Science, Technology and Environment reports decreasing visibility in Penang, northwest of Kuala Lumpur, and East Malaysia's Sarawak, and air quality is becoming hazardous.
Who is behind the fires fouling Southeast Asia's air? Slash-and- burn farmers usually get the blame, having no other recourse but to burn forest cover to clear land for cultivation. But recently, experts have pointed fingers at large agricultural and timber companies clearing land for oil-palm and industrial forest plantations – on a massive scale. "They burn 1,000 hectares at a time, while shifting cultivators burn only a hectare at a time," says Emy Hafild, executive director of the Indonesian Environment Forum. Logging methods add to the problem. Once loggers have chopped down trees, they leave about half their cuttings on the forest floor – ready to fuel a blaze. Weather conditions are incendiary as well: the archipelago is suffering its worst drought in five years.
On Aug. 13 in Jakarta, officials from ASEAN discussed the haze during a meeting of the grouping's Senior Officers on Environment Task Force. On the agenda: sharing the cost of water-bombing fires. Prime Minister Mahathir Mohamad has asked for expert help from countries like Canada and the U.S. Negotiations are under way to buy or lease water-bombing aircraft from Canadian plane- maker Bombardier. They can unload more than 50,000 liters an hour, drawn from the ocean rather than tanks on an airfield. But it's not cheap: operating one Bombardier plane costs an estimated $200,000 a month.
Jakarta officials are also looking into seeding clouds for rain on Ujung Pandang, Sulawesi island, and on Java's most severely affected areas. Indonesia has also agreed to increase policing efforts against illegal fires, especially in remote parts of the country. Malaysia's National Haze Committee suggests setting up volunteer fire brigades and hotlines to take reports of unlawful burning. Hafild is concerned that these measures will adversely affect small farmers with no means to clear land but fire. Even though the Indonesian government knows the major culprits are not shifting cultivators, it has not found the voice to say so. The director general of forestry, Titus Saridjanto, admits no immediate solution is apparent. Certainly, there seems to be little pressure from the public for official action. Having put up with the haze year in, year out, Indonesians just stay indoors in the worst areas. Elsewhere, a handkerchief on the nose and mouth is deemed enough protection on the street, and mostly against vehicle fumes, which are worse than the haze. Hospitals are not reporting a sudden rise in breathing complaints, and few companies are seeing productivity decline sharply. So anyone expecting heads to roll over the haze hazard to public health shouldn't hold his breath.
What the haze does to you
The dark haze that hangs over much of Sumatra and Kalimantan, thrown up by thousands of hectares of forest fires, would make a tree-hugging environmentalist weep. But even Indonesians used to the annual plague of clouds are weeping – from the potent mixture of smoke, dust and trapped smog. Luckily, the areas of the archipelago severely affected are not heavily populated.
Still, many of the 20 million Indonesians exposed to the haze complain of minor symptoms related to smoke inhalation, says Dr. Bastaman Basuki, head of the Department of Community Health at the University of Indonesia. These include irritation of the nose and throat, shortness of breath, and gray, gritty mucus. Long- term exposure to smoke can have severe consequences like lung disease and suffocation.
So far, says Bastaman, nobody's symptoms have reached the dangerous stage. Still, there are signs that the annual hazy visitation is affecting the national constitution. The most common health complaint in Indonesia – even when the air is smoke-free – is a sore throat.
What about the possibility of cancer or permanent lung damage? "There is no evidence to suggest such a possibility," maintains Bastaman. "We don't see any proof." While there is no apparent proof of serious, long-term harm, Indonesians unlucky enough to live and breathe under the vapor every year surely wish something can be done to clear the air.
| Arms/armed forces |
Far Eastern Economic Review - August 21, 1997
John McBeth, Jakarta – Before it began buying American in the 1970s, the Indonesian air force was comprised entirely of top-of-the-line Soviet-built fighters, bombers and helicopters. They were as much a legacy of the Sukarno years as the muscle- bound Lenin-style statuary found around Jakarta. Now, barely two months after scrapping the proposed purchase of nine American- made Lockheed Martin F-16 interceptors, Jakarta is looking to Russia once again for frontline combat aircraft.
National Development Planning Minister and former air force Gen. Ginandjar Kartasasmita announced on August 5 a $410 million deal to buy 12 Sukhoi Su-30MK multirole fighters. Defence Ministry sources indicate the aircraft may be fitted with Western rather than Soviet avionics and guidance systems.
The Indonesians are also buying eight Mi-17 helicopters for the newly enlarged Kopassus Special Forces Regiment. The Special Forces commander, Maj.-Gen. Prabowo Subianto, had originally sought refurbished American UH-1H troop-carriers to give his elite unit the lift capability it lacked during last year's hostage drama in Irian Jaya. But that sale went the same way as the F-16s.
President Suharto cancelled the F-16 purchase in early June, citing the "wholly unjustified criticism" of Indonesia in the United States Congress over East Timor and human-rights violations.
Although the Defence Ministry sources insist Indonesia is not thumbing its nose at the U.S. and that evaluations of the Su-30 began before the F-16 deal was proposed, the timing of the announcement appeared significant. As one U.S. official told the REVIEW: "I think it's a case of them having their cake and eating it too. They may not want to acknowledge it, but they do seem to be making a point."
Worth a bargain-basement $162 million, the nine U.S. aircraft were among 28 F-16A and B models Washington has withheld from Pakistan since 1990 because of Islamabad's refusal to disclose details of its nuclear-weapons programme. The U.S. government first proposed the sale to Jakarta in about mid-1995. Indonesian officials say that at that time they were already looking at the Su-30 to fulfil a requirement for aircraft with greater range than the 10 F-16s already in service.
Suharto finally approved the F-16 purchase in April 1996, but it began to go sour only months later when Congress threatened to block the deal. U.S. lawmakers wanted to deliver a response to the government-engineered overthrow of the Indonesian Democratic Party's chairman Megawati Sukarnoputri. Additional threats, particularly from Rhode Island Democrat Patrick Kennedy, further angered Indonesia.
Some Jakarta-based analysts believe that in any case, Indonesia could not afford both aircraft. The decision to buy the Su-30s, announced even before a contract has been signed, came two months after an angry Suharto had scrapped the F-16 sale and ended Indonesia's participation in the U.S.-led International Military Education and Training programme.
Negotiations are still under way over payment, technology transfer and spares supply. But Indonesia is expected to meet much of the overall cost of $600 million through a counter-trade deal involving palm oil, coffee and rubber. That transaction will be handled by Prima Comexindo, a trading house run by Hashim Djojohadikusumo, the businessman-brother of Prabowo. Comexindo has developed an extensive counter-trade network across Central Asia, the Middle East and Russia.
Both the helicopters and the jets will give the armed forces a significant performance boost. The Mi-17 helicopter carries 30 passengers, twice the capacity of the Bell UH-1H. Defence experts say the advantage of Indonesia buying bigger helicopters means it won't have to train as many flight crews.
The government says the Su-30s will be based at Ujung Pandang in South Sulawesi, mostly to protect the giant Natuna gasfield in the South China Sea–the focus last year of a major combined forces exercise. With a combat range of 3,000 kilometres, which the Indonesians could extend to 5,000 kilometres by inflight refuelling from C-130 Hercules tankers, the Su-30s will be capable of covering most of the archipelago.
In general, however, one senior Indonesian defence official characterizes the F-16s and now the Su-30s as "toys for the boys"–purchases that within the limitations imposed by tight budgetary restraints allow the air force to keep up with the latest technology. "Basically, our policy is to be as efficient as possible and as sophisticated as necessary," he told the REVIEW.
However, the Su-30 deal didn't seem to please everyone. Research and Technology Minister B.J. Habibie, who travelled to Moscow after the recent Paris Air Show to look at Russian military hardware, is believed to have lobbied for the French-made Dassault Mirage 2000-5 because of its more advanced technology. "The Russian economic mechanism doesn't encourage high-quality products," sniffed Habibie after the deal was announced. "It's not geared towards market forces."
Among the Sukhoi's shortcomings, Habibie told reporters, was a shorter lifespan than American and European aircraft, a more intensive maintenance cycle and higher fuel consumption. The only other contender appears to have been the Swedish-built JAS- 39 Gripen, but given its heavy content of American components, any sale would have required U.S. approval.
The defence official says the backbone of Indonesia's frontline air-defence system will continue to be built around three squadrons of ageing A-4 Skyhawk attack jets and F- 5E/F interceptors, as well as some 40 British Aerospace Hawks, including 24 new 100/200 models which are now being delivered. The Indonesians have options on another 16 Hawks–a deal which is still going ahead despite the recent debate in Britain over arms sales to Indonesia.
Russian defence sales teams have become increasingly aggressive in the Asian region. The Su-30 was a star attraction at last year's Indonesian Air Show, with Sukhoi taking some of Indonesia's generals for high-speed joy-rides. Because of delayed requests and mixed signals, the Americans had little hardware on show to match it.
Apart from their marketing, the Russians have been going out of their way to improve after-sales service–one of the problems which dogged India's three MiG-29 squadrons in the early 1990s. Defence sources say the Malaysians are generally pleased with the support they are getting from Russia since the MiG-29s entered service in 1995, and even the Indians have given a vote of confidence to Sukhoi by ordering 40 Su-30s.
Indonesia's specific mention of the Natuna gas field as a reason for buying the Su-30 underlines the fact that Jakarta is now giving a much higher priority to the protection of its maritime resources. When its status as an archipelagic state was recognized with the implementation of the United Nations Law of the Sea Convention in 1994, Indonesia gained an additional 3 million square kilometres of territorial waters, and jurisdiction over another 3 million square kilometres of an exclusive economic zone.
Perhaps more worrying than the as-yet untapped Natuna is the $2 billion that Indonesia is estimated to be losing each year to fishing poachers. Indonesia recently took delivery of 20 new Australian-built N22/24 Nomad aircraft for sea surveillance and has plans to buy more coastal patrol craft, tankers and other logistics vessels. Whether Indonesia looks again to Russia to fulfil some of these needs will probably depend on how well the Su-30 deal flies–and how much further the U.S. Congress wants to push its point.
| International relations |
Reuters - August 28, 1997 (abridged)
Sydney – Political stability and continued economic liberalisation are not assured in Indonesia over the next 15 years due to the country's leadership transition after President Suharto, according to a major Australian foreign policy paper.
The paper, entitled "In The National Interest" and released on Thursday, sets out Australia's foreign and trade policy into the next century and assesses political, economic and security concerns in the Asia-Pacific region.
Australia said its most important bilateral ties would be with the United States, China, Japan and Indonesia, and with the booming east Asian economies determining its economic future.
The conservative government said foreign policy would focus on pragmatic benefits for Australia, such as jobs and trade, with the "national interest" the driving force.
"We have produced a practical, hard-headed, results-oriented foreign and trade document," said Foreign Minister Alexander Downer, adding Australia would focus on bilateral rather than multilateral diplomacy.
Indonesia had enjoyed two decades of growth and social change which had fostered a wide-ranging, substantial relationship between the two countries, the paper said.
But it added the bilateral relationship would require "careful management as Indonesia faces a leadership transition."
"In these circumstances, continuing economic liberalisation, political stability and continuity in foreign policy are not necessarily assured over the next 15 years...," the paper said.
However, a senior official told Reuters this was not a negative assessment of Indonesia.
"Policy continuity is not necessarily assured over the next 15 years. Now, that is not a judgment that policy continuity is in any way at risk from our point of view," said the official.
"We are making a fairly commonsense observation that none of these things are guaranteed." Indonesia was rocked by violence during the May national parliamentary elections. The 76-year-old Suharto, who came to office in 1968, is expected to seek a seventh five-year term in next year's presidential election.
Australia said the strategic balance of power in the region was "positive," but that it could change direction if the booming Asian economies faltered or if there was a significant deterioration in U.S.-China-Japan relations.
| Economy and investment |
Voice of America - August 29, 1997
Jakarta – Indonesia's currency has plummeted to three- thousand Rupiah to the dollar, during the past few weeks. the sharp decline in the Rupiah and a prolonged drought have sent the price of basic food stuffs in the Southeast-Asian nation soaring. Jenny Grant reports from jakarta ordinary indonesians are feeling the aftershocks.
At the Pasar Minggu market in South Jakarta thousands of women jostle to buy their daily goods. This traditional market is the cheapest place to buy fresh food in Jakarta. but during the past four-weeks prices have increased between 15 and 60-percent on basic goods such as pepper, vegetable oil, tea, chilli, and onions.
Hafni, the 25-year-old owner of the Abadi shop in Pasar Minggu says the prices of more than one-half of his commodities have risen since early August.
Mr. Hafni says rice has risen 20-percent a kilo – about 40- cents. He says vegetable oil has increased by 11-percent and pepper is up 66-percent a kilo – about seven dollars.
He has owned the small wooden shop for four years and says his customers are now buying less and choosing cheaper spices.
Ibu Mar walks barefoot around the market with a tray of colorful cakes. The mother of two has been selling fried bananas and sticky rice at the market for seven years.
She says the price of her ingredients – wheat flour, cooking oil, and sago palm – have risen by around 15-percent, but her selling price must remain at 100-Rupiah per cake – about four cents. Ibu Mar says people will simply not buy the cakes if she hikes the price, which has been the same for the past three years. She says she and other cake sellers must absorb the higher costs for no return.
In front of the traditional market, dealers in a row of electronic shops say they are also feeling the effects of inflation.
Rijen, who works as an assistant in an electronics store selling fans, hairdryers, and rice cookers, says most electrical goods have gone up by 10-percent. He says the store has temporarily stopped any new factory purchases because the owners are afraid of having imported goods from Taiwan, South Korea, and China that customers cannot afford to buy.
Economists say the currency crunch has coincided with a severe drought that damaged crops such as rice, coffee, and corn.
Bruce Rolph from Bahana Securities told V-O-A the government has made an effort to control the price of basic commodities such as rice and cooking kerosene – which is seen as important for maintaining security in the nation of 200-million people.
This week, President Suharto warned indonesians the drought could cause food shortages until december. He ordered food related ministries to take extra care in ensuring adequate supplies of basic commodities.
The price of building material has also risen, making new homes more expensive. Mr Rolph said the full impact of the currency crisis has not yet been felt.
There are some companies, because of shortages in working capital, which are scurrying around with some alarm trying to get enough money to pay wages. That will start to have some effect over the next couple of weeks and of course food prices at the markets have already begun to rise. Building material costs in the last month have risen 35 to 40-percent, so I would say in the next four weeks it will start to become very obvious to the ordinary indonesian.
Mr. Rolph said severe inflationary pressure during the next few months could push Indonesia's 1997 inflation rate to eight or nine-percent. Inflation last year was six and one-half-percent.
Far Eastern Economic Review - August 28, 1997
John McBeth, Jakarta – Tucking into a plate of fruit, a late- afternoon substitute for his missed lunch, Rizal Ramli laughs when asked if he's an economic nationalist. But he doesn't reject the label. It seems to have stuck since Ramli, a prominent American- educated consultant, led an Indonesian outcry over the giant Salim Group's decision to shift ownership of its crown jewel, Indofood Sukses Makmur, to Singapore.
Ramli says moving the headquarters of the world's biggest noodle-maker offshore amounts to capital flight–and he isn't worried about Salim's threats to sue him for that assertion. "Salim has had so many privileges over the past 20 years, it should be setting a good example," he argues, echoing a sentiment that's been widely expressed in the Indonesian press.
Out on the newsstands, the weekly Forum Keadilan magazine seemed to say it all for critics like Ramli. Under a cover picture of Salim founder Liem Sioe Liong waving out of his limousine's open window, it asked: "Is it true? Will Uncle Liem 'Flee' to Singapore?"
Well-founded or not, the criticism of Salim raises concerns that other Indonesian businesses seeking to extend their corporate reach overseas may get the same treatment. More and more Indonesian companies are making such moves, looking to tap opportunities abroad and avoid perceived political risk at home. The question of how far they can go may be tested again in the months and years ahead.
But businessmen, economists and analysts alike feel Salim is a special case because of its singularly high profile and the cosy relationship it has enjoyed over the years with President Suharto's government. After all, other Indonesian groups have gone overseas recently without being singled out. Forays into Singapore by conglomerates Sinar Mas and Raja Garuda Mas drew little public reaction. No one has batted an eye about the Lippo Group's newly forged corporate links with China Resources, a subsidiary of China's Ministry of Trade and Economic Cooperation. Not so long ago, an alliance like that would have been seen as almost traitorous in Indonesia, where the loyalty of the ethnic- Chinese business elite is such an extremely sensitive subject.
Ramli insists he isn't opposed to companies going offshore, and he doesn't seem too fussed about the government's encouragement of business links with China. "But the legal shifting of assets is a different story," he says. "Why can't Salim raise capital here? With an earnings growth of 25%-30%, Indofood is a good play. Indonesia is the largest market in Asean, and it's still growing. Why can't Indofood just set up marketing offices in the places it wants to expand into?"
The uproar began on July 15, when Salim's Indocement Tunggal Prakarsa announced it was spinning off its 50.1% stake in Indofood to QAF Ltd., a Singapore-listed food company. This wasn't a sell-off: Three Salim-owned companies hold a substantial majority of QAF, and Indonesian government officials say the move doesn't violate the country's foreign-ownership rules.
Anthony Salim, the group's chief executive officer, says the move will allow Indocement to focus on its core cement business while giving Indofood new opportunities throughout Asia. Instead of starting from scratch, Indofood can utilise QAF's existing network in Singapore, Malaysia, Thailand, China, the Philippines and India to expand sales of food, beverages and consumer goods in those markets.
The one real impediment could have been the August 14 flotation of the rupiah, which exacerbated Indofood's large, unhedged U.S.-dollar-debt burden. But Indocement expects the deal will be approved at a shareholders' meeting set for August 21. "The deal will go through as is," says company spokesman Simon Subrata, who describes the currency crisis as "only a short-term phenomenon."
Perhaps, but the political questions surrounding the transaction are more fundamental. Although Indocement waited until after the May 29 parliamentary elections to make its announcement, critics still linked its move with the increasing political uncertainties surrounding what many believe is the autumn of the Suharto presidency. As one Jakarta-based broker noted: "Because Liem is seen as a business partner of the president and his family, it now looks like the group is cutting away and hedging its risk."
Certainly, the strength of the outcry caught the Salim Group by surprise. "We expected there would be a comment," says Executive Director Benny Santoso, "but we were surprised at the reaction in the press. We believed this was purely a business decision–otherwise we could have done it a lot more quietly."
As it was, the biggest broadside came from Ramli's Econit Advisory Group, which argued that Salim's economic and political importance could lead other companies to follow its example, sending Indonesia's economy into free-fall. "You can argue it is business as usual with some companies," Ramli says, "but you can't make that argument with Salim."
Given the fact that the government owns 25.73% of Indocement and 10.18% of Indofood, the deal clearly had official sanction. And as the criticism mounted, Suharto unleashed two government heavyweights–Coordinating Minister for Production and Distribution Hartarto and State Secretary Moerdiono–to ward off accusations that Salim's move demonstrated a lack of nationalism.
Far from putting capital to flight, Hartarto said the deal would generate a capital inflow of 1.7 trillion rupiah ($658 million)–the difference between the 4.2 trillion rupiah Salim would make from the sale of Indofood and the 2.5 trillion rupiah it would spend to purchase new shares from QAF. Hartarto noted that on top of that, the Indonesian government would receive 122 billion rupiah in income taxes and 100 billion rupiah from dividend taxes as a result of the restructuring.
Some questioned the need to field top government officials to defend Salim. "What this showed was the direct intervention of the president," says Syahrir, managing director of the private Institute for Economic and Financial Research. Syahrir complains that Moerdiono tried to make Salim "look like a hero" by referring to the change of ownership as "new nationalism."
Djisman Simandjuntak, executive director of the Prasetya Mulya Management Institute, feels it's unfair for critics to single out Salim. "Somehow, Salim is always considered as the group which benefits the most from its connections with the government," he says. "But I think that needs to be analyzed in greater depth. All big business groups have benefited from the same privileges, especially when we had very inward-looking policies."
But the fact that it was Salim moving assets offshore clearly upset Indonesian sensibilities. The group has major interests in many of the country's key industries, from cement and food to property, chemicals, palm oil and other agribusiness ventures. And when many ethnic Indonesians question Salim's patriotism, they're expressing a deeper discomfort. After all, nationalism takes on a special meaning in a country where 70% of the economy–including Salim–is controlled by a tiny ethnic-Chinese minority.
Voice of America - August 21, 1997
Jenny Grant, Jakarta – In his state of the nation address last weekend, president suharto said the government must postpone some projects because of the devaluation of the national currency, the rupiah.
The Rupiah has fallen more than 20-percent against the U-S dollar since January. last week the Central Bank floated the Rupiah. It fell to an all time low against the dollar.
Finance Minister Mar'ie Muhammad also said non-priority government projects would have to be deferred.
This week the head of the Gemala group, Sofyan Wanandi, suggested the government should shelve the national car project, the state jet program, and two construction projects. But the leaders of these projects – including family and close associates of president Suharto – say they are un-willing to defer their plans. Mr. Suharto's youngest son, Hutomo Mandala Putra, said he will not re-schedule the national car project because it will strengthen the long-term fundamentals of the economy.
The government awarded the national car project to Mr Mandala Putra last year, giving his company "P-T Timor Putra Nasional" exclusive import duty and luxury tax breaks. The tax breaks allow Mr Mandala Putra to sell the car 60-percent cheaper than similar sedans.
Research and technology minister Jusuf Habibie was quoted as saying the government will not suspend any of its strategic industry programs.
Mr Habibie also chairs the Board of Strategic Industries which coordinates ten strategic industries including the state aircraft manufacturer, I-P-T-N, which is developing several planes, including the N-250 and N-2130 passenger jets.
Critics say the aircraft program is drawing billions of Rupiah from the national economy and indonesia cannot afford to continue its aircraft manufacturing industry.
Despite the call to lower spending, president Suharto's daughter, Siti Hediati Heriyadi Prabowo, this week unveiled a new mega- project – a 95-kilometer bridge linking Indonesia and Malaysia across the Malacca Straits. Mr. Suharto has approved the bridge which will be built by Mrs. Prabowo's company "P-T Malindo Transmadu" and Malaysian firm "Renong".
| Miscellaneous |
SiaR - August 16, 1997 (posted by Tapol)
Three leading Jakarta dailies, Republika, Suara Pembaruan and Merdeka, have been warned by Information Minister, retired General Hartono. The warnings were delivered during a meeting with editors-in-chief and the financial authorities.
During the meeting which was held to discuss the falling rate of the rupiah, editors were told to avoid publishing anything that might have a negative effect on the Indonesian currency. The Governor of the Bank of Indonesia, Soedradjat Djiwandono, explained how the press could help the government protect the rupiah. Republika and Suara Pembaruan were both warned because they had published an article under the headline, 'Rupiah falls' on the front page. However, the Jakarta Post, which also published a report under the same headline was not warned, apparently because the report appeared on an inside page.
Other papers were not warned even though they published reports saying much the same thing. Following the warning, papers were much vaguer in their reporting of the currency crisis. Another daily, Kontan avoided a warning, apparently because it made the same point but the other way round, using a headline which read, 'Dollar strengthens'.
The warning to Merdeka was about something quite different. It was warned for publishing a photo of Lt-General Syarwan Hamid, Social and Political Affairs chief of staff of ABRI, shaking hands with Megawati Sukarnoputri, chairperson of the PDI. The photo was published in connection with a report quoting Syarwan Hamid as saying that Megawati has acted in conformity with the constitution. Hartono reportedly takes acception to Syarwan Hamid's statement -- regarded as being on behalf of ABRI headquarters -- because it reflects the beginnings of an accommodation with Megawati.