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ASIET Net News 48 – December 15-21, 1997
Antara - December 16, 1997
Dili – East Timor Governor Abilio Jose Osorio Soares has
confirmed that the Movement for the Reconciliation and Unity of
the People of East Timor, which had been established by a group
of sympathizers, was a proscribed movement because it could
threaten the integrity of the unitary Republic of Indonesia.
"The provincial government has questioned and rejected the
movement which exists under the disguise of reconciling and
unifying the East Timor people," Governor Soares told journalists
before opening the seventh provincial consultative meeting of the
East Timor chapter of the Indonesian National Youth committee in
Dili on Monday afternoon.
Governor Soares firmly rejected the presence of the MRUPT in the
youngest Indonesian province because it was clearly not designed
to reconcile and unify the East Timor people but had certain
political objectives.
"The government must immediately disband the movement if it is
designed to undermine the government," Governor Soares said...
Monitoring
Police Col Doctorandus Atok Rismanto, SH, chief of the East Timor
Provincial Police, said police were constantly monitoring the
dvelopments of the organization.
Police have sent a letter to the East Timor provincial government
offering suggestions and input as well as set up a special team
to deal with the movement.
"Had the organization had positive objectives, it would have
pursued correct procedures, i.e. having a permit and statutes,"
he said, while expressing his doubts that the MRUPT had pursued
the procedures.
According to MRUPT chairman Manuel Viegas Carrascalao, the MRUPT
wanted to help the provincial government unify the politically
divided East Timor people and was not opposed to the government
and ABRI.
DIGEST No. 48 (Indonesian news with comment) - December 18, 1997
A new, openly dissident movement has sprung up within East Timor.
If Manuel Carrascalao's Movement for Reconciliation and Unity of
the People of Timor (GRPRTT) is as serious about its mission as
it claims to be, it will represent a brave new initiative.
It comes from an unexpected corner. Manuel Carrascalao once
actively supported East Timor's integration with Indonesia.
Carrascalao first announced his movement in a letter to the UN-
sponsored All-Inclusive Intra-Timorese Dialogue in Austria last
October. He launched it with fanfare at a UDT congress in Perth,
Australia, early in December.
The movement's manifesto begins by recalling that the Portuguese
law on decolonisation of 1974 envisaged self-determination for
East Timor. But Indonesian military intervention prevented self-
determination, it says. It then calls on all the East Timorese
political parties to unite behind a program of peaceful
negotiation to resolve the conflict over Timor's status.
Manuel Carrascalao, 65, comes from a wealthy mixed Portuguese-
East Timorese family. All were members of the anti-communist UDT
in the heady days of 1974 and '75. Manuel actually led UDT
fighters backed by Indonesian soldiers (under Dading Kalbuadi)
during the invasion between October and December 1975. He thought
they were wresting East Timor from the hands of the 'communist'
Fretilin, but found themselves used in a larger gameplan by the
Indonesian military.
Manuel had been a member of the provincial assembly in Portuguese
times. In 1982 he became a member of the same assembly under
Indonesian rule, on the platform of the government party Golkar.
'I try to be a good Indonesian', he said. His younger brother
Mario was the governor. Another brother, Joao, heads the UDT from
exile in Sydney, Australia.
But for several years now Manuel Carrascalao has been outspoken
on human rights abuse in the territory. For the foreign media he
is probably the most sought-after person inside East Timor after
Bishop Belo. He has mediated in clashes between the military and
students on numerous occasions.
Late last year he fell out with Golkar and was not pre-selected
for a fourth term in the provincial assembly. During the election
campaign in May 1997 he said he ruled out voting for Golkar,
because its candidates were 'hateful' to the East Timorese.
In May and July 1997 he backed a group within the provincial
assembly led by Mrs Maria Quintao that strongly opposed the re-
appointment of Abilio Soares as governor. That effort failed.
The movement's 30-odd board members include others like Manuel
Carrascalao: ex-regents and other former government officials,
who enjoy local respect.
Its general secretary Francisco Lopes de Carvalho was private
secretary to governor Abilio Soares until he was sacked in March
1997 for (he says) refusing to play pro-integrationist charades
demanded by Jakarta.
Mrs Maria Quintao, 46 and from another prominent family, holds
the deputy chair.
Others such as Oscar Lucio Goncalves belong to traditional
aristocratic families (liurai) who made up the small party
Apodeti in 1974-75. Pro-Indonesian Apodeti members were initially
prominent in the East Timor public service, but many were later
replaced by better qualified Indonesians, and became embittered
against integration.
How will his movement fare? Manuel Carrascalao no longer has an
official position. Governor Abilio Soares is understandably
furious. The local military commander has threatened to arrest
Manuel Carrascalao and the others for being 'anti-Indonesian'.
But the military will be reluctant to make martyrs out of these
local prominents for fear of triggering unrest. The government
will no doubt try to ignore these former officials and say they
suffer from 'sour grapes'. But if Carrascalao sticks to his guns,
ignoring them may not be easy.
It is not yet clear what Jose Ramos Horta or Xanana Gusmao think
of Manuel Carrascalao's initiative. Carrascalao identifies with
the UDT, and at its last congress the UDT did not speak kindly
about the CNRM led by Horta and Xanana. In the past, Carrascalao
has been critical of Horta. But he does support Horta's call for
a ceasefire and for peaceful negotiations.
Unlike Horta, Manuel Carrascalao is inside and operating openly.
The next few weeks will decide whether this is another splinter
group, a manoeuvre by a man with something of a history of doing
local deals with the military, or conversely a new movement that
can rise above its origins to make a difference.
[Gerry van Klinken, editor, Inside Indonesia magazine]
Environment/land disputes
Human rights/law
Arms/armed forces
Economy and investment
Politics
East Timor
East Timor governor proscribes new movement
A surprise East Timor initiative?
East Timorese in embassy under pressure to leave
The AustralAsian - December 18, 1997
Darwin – Six East Timorese who have sought refuge in the Austrian embassy in Jakarta, since September 19, are in danger of being handed over to the Indonesian authorities.
Handwritten messages, smuggled out, have been received, here in Darwin, from the East Timorese holed up in the Austrian embassy, asking for help in the form of pressures to the Austrian government.
The Austrian embassy claims they are not pressuring the six to leave the premises and give themselves up to the authorities. According to the embassy, the six are vacillating between staying on and giving themselves up to the Indonesians.
However, from the smuggled messages, the Austrian embassy is applying subtle pressure to get the Timorese to give themselves up voluntarily. The six are prevented from receiving any information from outside and the only contact they are allowed to have is with Lopez da Cruz, who works for the Suharto regime!
The six East Timorese are also being told that their case is hopeless and that they better use the current offers of guarantees of protection if they give themselves up at this stage. The Austrian embassy is also seeking a written note from the six "that they are leaving on their own free will."
Background information
The six , including a family of four, sought refuge in the Austrian embassy on September 19, fearing detention and torture by the Indonesian military (Abri).
Indonesian authorities allege that two of the asylum-seekers have been involved in the manufacture of homemade bombs and are members of a "terrorist group."
Abri on October 22 said Avelino Maria Coelho da Silva and Nuno Vincente Pereira carried out "terrorism, sabotage and murder, aimed at creating instability in the country." Indonesian Foreign Minister Ali Alatas and Suharto's daughter Tutut have urged Austria to hand over the two for questioning. It is claimed that they are linked with 13 East Timorese arrested on September 13 and 15 following the discovery of homemade bombs in Semarang and Dili.
According to a Reuters report of November 10, Ali Alatas was quoted as saying: "Our stance remains the same. The Indonesian government will keep demanding that the two are handed over to the police for investigation. If the others want to go to Portugal, just go ahead." Alatas said Indonesia would not permit the Avelino and Nuno to leave for Portugal.
Amnesty International - December 12, 1997
On 11 December 1997, two East Timorese men were sentenced to death after being found guilty of participating in an ambush on a truck carrying members of the Indonesian security forces. This is the first time the death penalty has been handed down by the courts in East Timor since its occupation by Indonesia in 1975. As many as 53 others are also believed to be on trial for their alleged involvement in this and other attacks. Some of these may also face the death penalty if convicted.
Francisco da Costa and Luis Maria da Silva were tried by the Baucau District Court. It is reported that they were charged with murder, separatist activities and illegal possession of firearms. According to information received by Amnesty International the two men were defended by court appointed lawyers because the families of the two men were afraid to appoint their own lawyers. This, and other longstanding concerns about the Indonesian judicial system, raises fears that their trial may not have met with international standards for fair trial. The two men are reported to have lodged an appeal to the High Court.
The attack by Falintil (the East Timorese Liberation Army) took place on 31 May on the road to Quelicai, Baucau. A grenade was thrown into the truck causing an oil drum to explode. Thirteen people in the truck were burned to death and a further four were shot as they tried to escape.
The attack was one of a number by the East Timorese armed opposition against military and civilian targets which took place in the run-up to, and immediate aftermath, of the Indonesian parliamentary elections. Over 100 people were arrested in operations by the authorities to find those responsible for this and other attacks. Only those currently on, or facing trial, remain in detention. The elections created a high level of tension in East Timor because they were seen as a symbol of East Timor's incorporation into the Indonesian state which is rejected by many East Timorese.
At least 42 people, including police and members of the Falintil, are believed to have been killed during the attacks. At the time Amnesty International acknowledged that the armed opposition had committed human rights abuses and called on them to abide by international humanitarian standards, but expressed its fear that the operations by the authorities to apprehend those believed to be responsible resulted in further human rights violations including arbitrary detention, torture and ill-treatment.
Tapol - December 14, 1997
Two lawyers from the Indonesian Legal Aid and Human Rights Institute, the PBHI, recently spent two days in Semarang in connection with several East Timorese who will shortly go on trial in connection with bomb-making. They were able to meet four of their clients who have been detained there since mid-September in connection with bomb-making at a house in Demak. The East Timorese told their lawyers that they were not involved in making bombs.
The PBHI is acting for the five East Timorese now under arrest in Semarang, Ivo Salvador Soares Miranda, Fernao Pedro Malta Coreia Lebre, Joaquim Santana, Domingos Natalino C.C. da Silva, and Gil Paulo da Silva.
I. The first four told the lawyers they knew nothing about bombs until an explosion took place in Demak on 13 September. Following the explosion, the security forces visited the lodgings of all East Timorese in the area, to check on their identity. Intimidation was used during these check-ups.
It so happens that Domingos Natalino and Joaquim Santana had to leave the lodgings where they had been staying because their contract ended on 11 September. They went to Jl Mahesa Timur Gg IIB/483, Semarang to stay there temporarily until they found somewhere else to stay. Ivo was living at Jl Lempongsari Barat IV/352, Semarang, Fernao Pedro was living alone, while Gil Paulo da Silva was living in Jl Sundoro No 20, Manahan Surakarta, Solo.
Joaquim Santana was arrested on 14 September while on his way to the address in Jl Mahesa Timur to pick up his belongings from there. Later the same day, Domingos Natalino together with a friend called Joe (whose parents own the house on Jl Mahesa) were arrested as they were going back to the house on a motorbike. Joe was released the following day but Domingos has been in custody ever since.
Fernao Pedro and Ivo Salvador were arrested while on their way to the same house intending to spend a few hours with friends. Gil Paulo da Silva was arrested on 3 November when he responded to a summons from the Semarang police for questioning in connection with the bomb-making.
II. All five men were arrested without arrest warrants and they have not yet been officially informed of the charges against them. The lawyers were able to ascertain from discussions with officials at the Semarang Public Prosecutor's office that the first four will be charged with involvement in bomb-making under emergency law no 12 of 1951 as well as articles in the Criminal Code regarding arson and for failing to report a criminal action. Relatives in Semarang have not been told about their arrests.
With regard to Gil Paulo's arrest, the facts are as follows:
When the explosion occurred in Demak, a young man named Joao Bosco was injured in the blast on 13 September. He fled to Solo and asked Gil whether he could spend the night with him. When asked about his injuries, Joao said he had fallen from a bus. Feeling sorry for him as a fellow East Timorese, Gil took him in for the night. The next day Joao left Gil's home without telling Gil where he was going and he still does not know his whereabouts.
Gil was questioned by the security forces about Joao, while they were visiting the homes of many East Timorese in Solo, looking for Joao Bosco and others. Gil then decided to go voluntarily to the local military command to report that Joao had indeed stayed with him for one night, but he insisted that he know nothing about Joao being involved in making bombs.
Satisfied with his explanation, the army and police officers told him to go home and get on with his studies.
A month later, Gil received a summons from the Semarang police for questioning. He responded to the summons on 3 November and told the police that he knew nothing at all about the explosives case in Semarang. He said that he had helped Joao Bosco because he felt sorry for him. However, he was arrested and has been in custody ever since. Nothing is known about the charges against him, but it is understood that he may be accused of giving hiding to someone being sought by the authorities and for destroying items of evidence. His family has not been informed of his arrest.
III. During their detention, the first four men have been subjected to harsh treatment. Fernao has been tortured with electricity and intimidated, Domingos has been punched in the chest, Joaquim has been tortured and Ivo has been terrorised and intimidated.
IV. They told the PBHI lawyers that they know nothing about the explosives case and are not involved in any way. They were forced while being tortured to sign interrogation reports (BAP) that had been prepared in advance by the interrogators.
V. Until they were visited by the PBHI lawyers they had not been contacted by any lawyers, in breach of the Criminal Procedural Code. During interrogation by the police and public prosecutor officials, they have not been accompanied by lawyers.
The PBHI lawyers were given permission by the Semarang Public Pprosecutor's office to meet the four in Pane Prison, Semarang on 5 December and spent thirty minutes with them. They were informed by an official at the office that the four men may go on trial this week or in two weeks time. Gil is still being held by the police; the lawyers were not permitted to visit him.
| Environment/land disputes |
Reuters - December 15, 1997
Lewa Pardomuan, Jakarta – Famine triggered by a severe drought has spread to Indonesia's Moluccas region, threatening more than 80,000 people, while relief efforts continued in remote Irian Jaya, officials and the media reported on Monday.
The official Antara news agency reported villagers in three of the worst-hit districts in the Southeast Maluku regency had been forced to forage for yam and fruit in the forest.
``The drought has threatened 81,840 people in at least 130 villages in seven of eight subdistricts in Southeast Maluku since September," W.M. Parinusa, head of the social services office, was quoted by Antara as saying on Saturday.
Parinusa said forest fruit and yam had become scarce in Lemosa district, adding that the government had sent at least 11.25 tonnes of rice to the villages.
The drought has triggered rampant forest fires in Indonesia and caused famine in remote Irian Jaya province on the western side of New Guinea island where more than 500 people have died.
Rains have started in the western part of Indonesia but many other areas, mostly east of the archipelago, remain parched. The rainy season has started in some highland areas in Irian Jaya.
``We are continuing to send food supplies to the drought-stricken areas in Irian Jaya. The main problem is the weather which keeps changing due to the start of the rainy season," an official at the disaster coordinating centre told Reuters by telephone on Monday from Wamena in Irian Jaya.
``Many times we had to cancel flights because of the thick fog which is the result of rains the previous night," he said.
A total of 554 people have died in Irian Jaya because of the famine and drought and at least 150,000 people are vulnerable to food shortages.
Most of the areas affected can only be reached by air and are surrounded by some of the world's most rugged terrain.
The drought, exacerbated by the El Nino phenomenon affecting global weather patterns, has devastated crops in Irian Jaya, mainly yam and sweet potato.
The official in Wamena said the government had sent 12.5 tonnes of cassava grain and other foodstuffs.
``We are teaching volunteers in Wamena to prepare the grain for the people in the interior," he said.
The official said at least 14 flights had been planned to transport food supplies on Monday.
``The main concern now is disease such as malaria which is rampant. We are also preparing more doctors to come to the affected areas to treat the victims," he said.
President Suharto last week ordered Planning Minister Ginandjar Kartasasmita to end the famine in Irian Jaya.
Authorities and non-governmental organisations have dispatched tonnes of rice, noodles and blankets to the drought-stricken areas.
The International Committee of the Red Cross (ICRC) said last month that drought-related famine would cause thousands of deaths if emergency food supplies did not arrive soon.
Tapol - December 14, 1997
Villagers in Riau province who fenced themselves in on ancestral land to back a compensation claim against Riau Andalan Paper and Pulp Company were driven from the area when heavily-armed forces of Brimob (Mobile Brigade), the special forces of the Indonesian police, attacked them with smoke bombs and tear-gas. Several villagers were wounded and hospitalised while others complained of being hit by bullets.
According to the Jakarta weekly, TIRAS (8 December 1997), the unprovoked attack has shattered the hopes of the more than four hundred families living in Delik Village, sub-district Ppangkalan Bunut in the district of Kampar, to obtain compensation from the company for their ancestral land.
Riau Andalan Paper and Pulp Company is owned by APRIL, the Indonesian conglomerate which recently created an alliance with the leading Finnish paper manufactuers, UPM-Kyemmene, for the construction of a paper mill close to the company's pulp mill. The contract which is to be finalised in the next few days has aroused widespread controversy in Finland, where a number of environmental and human rights organisations have called on the Finnish company to withdraw from the contract unless strict conditions protecting the local people are written into the deal.
Two days after Carmel Budiardjo of TAPOL, the Indonesia Human Rights Campaign, met UPM-Kymmene Vice-President for Environmental Affairs, Mr Hannu Nilsen, during a visit to Helsinki, she renewed her call on the Finnish company to withdraw from the deal.
'Mr Nilsen assured me that his company takes responsibility for the entire production process from the tree in the forest to the paper in the shop. It cannot therefore turn a blind eye to this blatant abuse of the local people's rights to compensation and the violence used against defenceless villagers by heavily armed crack troops of the Indonesian police force.'
During their meeting on Friday, Budiardjo warned the company that local communities are vulnerable to intense pressure from local authorities to surrender their land and could face violence from the security forces if they desist.
The villagers are contesting plans by PT RAAP to build a 25- kilometre road linking their pulp mill to an industrial timber estate in Pelalawan which cuts through ancestral land owned by the villagers.
In May this year, the villagers reached agreement with the company for payment of compensation. But doubts that the company would pay up grew when it became clear that compensation promised in 1993 for nearly two thousand hectares of land would never be paid. That land has already been used for the construction of company buildings. The company's failure to pay up has been raised on three occasions by Indonesia's National Human Rights Commission, but to no avail. The villagers now feel, with justification, that they do not want to be cheated a second time by the company.
A week before crack troops attacked the villagers, PT RAAP announced that it would no longer honour the earlier compensation deal. In a letter dated 15 October 1997 from company director, P. Daritan, the company argued that compensation was not called for as it had now obtained the necessary permit for erecting company premises on land owned by the villagers, thanks to a recommendation from the district chief and a permit from the local forestry office.
| Human rights/law |
Kompas - December 16, 1997 (posted by Tapol)
The South Jakarta district court has not yet fixed a date for the subversion trial of Sri-Bintang Pamungkas, the former MP who is currently serving a one-year sentence for insulting the head of state. But the chairman of the court confirmed that the trial will commence before the end of December.
Sri-Bintang will be charged under article 1 of Law No 11/PNPS/1963, for which the maximum penalty is death. The court chairman denied suggestions that the delay in commencing the trial had been caused by the difficulties in studying the trial documents. 'It's just a matter of fixing the appropriate date, taking into consideration the commitments of the judges.'
Sri-Bintang has appointed a team of lawyers which includes Bambang Widjoyanto, Apong Herlina, Daniel Panjaitan, Paulus Mahulete, Moh. Assegaf, Adnan Buyung Nasution and R.O. Tambunan.
[It is understood that two others who, together with Sri-Bintang, founded the political party, PUDI, Saleh Abdullah and Julius Usman, will also go on trial soon on similar charges. TAPOL]
Institute for the Studies on Free Flow of Information (ISAI), Jakarta - 9 December 1997
Despite protests at the previous banning of "Marsinah Menggugat" (Marsinah Accuses) on 26 November 1997, the performance scheduled for 6 December at the Centre Culturel Francais (CCF) in Bandung was once again banned by authorities. The ban was reportedly carried out by the West Java police, the Bandung police and the Central Bandung police. More than a hundred police were deployed with a number of large trucks, as well as one tank. They blocked the road towards Purnawarman road, closed the gate to the CCF and would not allow anyone to enter the building. Police also took down banners that had been placed by the organising committee for the performance at the CCF.
The police, who reportedly carried out the action without appropriate documentation, accused the organisers of not having obtained appropriate permission for the performances. According to current regulations as passed by the government, such as Juklap/02/XII/1995 which was authorised by the Indonesian Chief of Police on 29 December 1995, Section C, article 1 paragraph f states that, "Cultural performances in the form of music, dance, drama, poetry reading, opera, pantomime, regional performances and other similar genres, are regarded as public meetings which do not require permission or notification."
The director of the CCF, Jean-Michel Phelline, who is also the French Consul in Bandung, demanded that the police withdraw the ban, open the gates to the CCF building and allow the prospective audience to enter so that the performance could go ahead. Phelline also reminded the police on several occasions that, since the CCF building is also the French Consulate, their actions were considered to be in violation of diplomatic norms. He informed them that the French Ambassador would make a formal protest about the incident to the Indonesian Foreign Office.
Background
"Marsinah Menggugat", by Ratna Sarumpaet, deals with the unresolved murder of Indonesian labour activist Marsinah. The planned 26 November performance was stopped by police only three hours before the performance was due to begin at the Cak Durasim Building in Surabaya. The play had previously been performed without problem in several different cities.
[Marsinah was a women activist who led a strike at the PT Catur Putra Surya watch factory in Surabaya, East Java. On May 8, 1993, three days after the strike, her body was found in a remote hut. The medical examination found that she had died as a result of injuries inflicted during torture. Although there was considerable circumstantial evidence that she had been kidnapped and killed by the military, in 1994 nine managerial personel and security guards from the factory were tried and convicted of the murder. All of the defendants claimed that they had been tortured in order to extract confessions. On May 5, 1995, all nine were released - James Balowski.]
Sydney Morning Herald - December 12, 1997
Louise Williams, Jakarta – Two Australian activists are in custody after being arrested by Indonesian security forces during a human rights demonstration on Wednesday in the central Javanese town of Semarang.
The Australian Embassy confirmed that Mary Little, 23, and Stuart Munckton, 20, both of Perth, were in contact with their families and embassy officials, but gave no further information.
"We are not in a position to say anything more, bearing in mind privacy considerations. But we believe the matter will be resolved in the near future," an embassy statement said.
The pair were in Indonesia on a study tour highlighting the conditions of the urban poor, organised by the Australian-based Action in Solidarity with Indonesia and East Timor (ASIET), and allegedly joined Indonesian university students in the demonstration.
Semarang's Military Commander, Lieutenant-Colonel Suprianto, said the involvement of the Australians was a "clear indication" that East Timorese fighting against Indonesian rule had international links.
Military sources here said the Australians had been taking photographs of the demonstration while visiting Indonesia on tourist visas. It is understood they were being held last night by immigration officials and questioned by police.
ASIET describes itself as an organisation concerned with the promotion of democracy in Indonesia. A spokesperson said Ms Little is a full-time health administrator and Mr Munckton a social science student at Edith Cowan University.
Earlier this year the Indonesian military said it was seeking an Australian national, known only as Jeffrey, who had travelled to central Java where he had taught East Timorese independence activists how to assemble bombs.
This is the second time Australian nationals have been arrested by Indonesian security forces this year. Two senior unionists were arrested in September after attending the congress of an unrecognised Indonesian trade union.
Hundreds of demonstrators supporting the democracy leader Ms Megawati Sukarnoputri faced riot troops in central Jakarta yesterday, chanting anti-Government slogans and calling for a new President. The demonstrators gathered outside the Central District Court, which rejected a case filed by Ms Megawati's supporters seeking compensation for the bloody attack on their headquarters by security forces last year.
Witnesses said hundreds of heavily armed riot police and troops prevented demonstrators from entering a plaza and the march was moving down one of the city's major streets.
| Arms/armed forces |
The Independent - December 13, 1997
Anthony Bevins – Oxfam yesterday accused the Government of being in breach of its own guidelines on arms sales. Eleven arms-export licences have been granted to Indonesia since 28 July, when Robin Cook, the Foreign Secretary, announced new regulations for arms sales overseas.
"This flies in the face of the criteria," an Oxfam spokesman said yesterday. "In practice, what is happening is not the same as Mr Cook is saying." Oxfam's analysis suggested that since Labour took office in May, there have been 22 arms export licences issued for Indonesia - half of them since Mr Cook issued his new regulations.
According to Margaret Beckett, President of the Board of Trade, just four applications have been rejected since the regulations were introduced. But the Oxfam spokesman said that government figures presented only half the picture, because they related to military equipment. Police equipment was not included.
Opening a campaign with advertisements in some newspapers today - showing a child with a gun, and the message "Dear Santa, Please don't send me a gun this Christmas" - Oxfam said that current regulations were still too weak. It urged the Government during its six-month presidency of the European Union, from January, "to agree a genuinely tough EU-wide code of conduct on arms exports to prevent arms going to repressive regimes".
The spokesman said the Charity Commission had ruled that charities were allowed to become involved in political campaigning where the issues involved were "pertinent" to their work. "If we are to stop small arms falling into small hands, then a vital part of the solution is for both British and EU arms sales to be regulated by a far tougher code of conduct than the Government appears committed to," Diana Melrose, head of policy at Oxfam, said.
Oxfam has discovered, according to the latest analysis of export licences, that a "worrying" number has been agreed for countries where there is a strong risk of weaponry being used against civilians - including Turkey, Indonesia, Algeria, Colombia and Nigeria.
| Economy and investment |
Financial Times - 16 December 1997
Sander Thoenes – The warning calls of growing unemployment echo through the alleys and back streets of Indonesia's inner cities.
They are the cries and whistles, rattling of spoons and banging of pots of the self-employed men and women who peddle food, ice cream, plastic buckets and other odds and ends from dawn to late at night.
These men and women seem to offer far more than can possibly be in demand, but this informal sector of the economy has managed to absorb millions of Indonesians who cannot find steady jobs despite rapid economic growth. Their key to survival is the long hours they work and the speed at which they cruise through neighbourhoods to maximise turnover.
Just as these street traders cannot afford to slow down, neither can the economy. The government estimates it needs 5 per cent growth in gross domestic product to absorb the 2.4m people who enter the job market each year. The consensus of 17 forecasters last month was that the on-going currency crisis would cut growth to 4.2 per cent in 1998, against earlier predictions of 7.6 per cent. Some economists say the continued fall in the rupiah makes this estimate optimistic and warn of stagnation.
The International Labour Organisation (ILO) warned last week the slowdown in south-east Asia could spark social unrest as millions lose jobs and others see inflation eat away their purchasing power. Nowhere are risks more obvious than in Indonesia, the region's largest country with 200m people, which has experienced strikes and riots in growing numbers in recent years.
This month 50 large Indonesian enterprises asked the government for permission, which is obligatory by law, to put off 10,000 workers. More than 8,000 workers lost their jobs when 15 troubled banks were shut down and construction companies have already told thousands of day labourers not to come back. Thousands of Indonesian migrant labourers are being sent home from Malaysia and Thailand, which face similar economic problems; more than 10,000 are being evicted from Saudi Arabia. Farmers, who still represent more than half the workforce, have seen their harvests crippled by drought.
Officials say unemployment in the capital rose from 4 per cent in 1996 to 6 per cent in October of this year; the last nationwide estimate dates back to 1995, at 7.24 per cent. Unemployment statistics understate the problem, however, as a person is considered employed if he works one hour a week; by most estimates, more than 30 per cent of the population was under- employed even before the currency crisis.
The government is aware of this challenge and has pledged to give priority to labour-intensive industries for subsidies in next year's budget. They have vowed to protect workers from arbitrary dismissal but realise that many debt-ridden enterprises could go under if they do not shed workers. Indonesia's enterprises, many of which were hit by the 47 per cent depreciation of the rupiah which boosted the cost of imports and of servicing offshore loans, will be hard pressed to pay wages for those who held on to their jobs, let alone index wages to inflation. Prices rose 1.65 per cent in November - food prices rising even faster. Consumer prices were up 9.01 per cent in the 11 months to November.
"It's brewing in the regions," said one labour activist from Sumatra. "Prices are going up and wages are as miserable as ever." The minimum daily wage equals $1 in many regions. Workers have gone on strike to demand wage increases at some of Indonesia's largest factories, such as the Gudang Garam cigarette factory in east Java, which employs 40,000 people. They have walked out of textile and shoe factories that account for much of Indonesia's non-oil exports.
Labour activists say strikes and riots are most likely to escalate on the eve of orchestrated presidential elections in March, which should extend President Suharto's 30 year rule by another five years. "The real reaction of the workers will come in December and January," predicts Teten Masduki, a lawyer who defends workers in labour conflicts. "Even when there is no monetary crisis, prices rise in these months. It is the time of Ramadan [the Moslem month of fasting], and that is when companies usually pay a special bonus. Normally, many companies do not want to pay the bonus and that is when workers strike. Thirty per cent of all strikes occur during Ramadan. This year it will be much worse."
The street trade may not be able to absorb the unemployed this time. Unemployment is highest among the young and educated, who balk at menial jobs. And in recent weeks the number of vendors has dropped sharply, with traders blaming the start of the rainy season and rising inflation.
"It's more difficult than before. Many of us have gone back to villages to resume farming, but I do not own any land so I don't have a choice," one trader said.
Jakarta Post - December 16, 1997
Jakarta – World Bank country director for Indonesia Dennis de Tray urged the government and private sectors again yesterday to provide edible information to help store public confidence in the country's economy.
Speaking at a seminar on Indonesia's macro economy, de Tray said the government needed to issue a strong and quick sign of its implementation of reform measures to cope with the currency turmoil.
"The signal should constitute more actions than promises," he said.
De Tray also stressed the importance of the government to clearly accept the ongoing monetary crisis and recognize models for change to restore market confidence.
"Neither the government nor private sector has the credibility in delivering the information to domestic and international investors," he said.
The seminar titled, "The Prospects of Mutual Funds Today and Tomorrow", was organized by the Institute for Economic and Financial Research (ECFIN).
"The government has to deal with the crisis in a highly efficient way by using models of global rules, " he said. De Tray said the government should also recognize a model of change in the cultural system, legal system, infrastructure and financial institutions in Indonesia to meet global business practices.
"And there should be a mechanism to make such changes," he said.
He said Indonesia's monetary crisis, unlike Thailand's, was largely driven by domestic factors rather than by overseas factors.
Indonesia has been the hardest hit by the regional financial crisis which broke out following the Thai baht's devaluation in July this year.
The rupiah, for example, fell to a historic low of 5,800 against the U.S. dollar yesterday, down by about 56 percent since July this year before easing to a close of 5,750 yesterday
The main price index on the Jakarta Stock Exchange (JSX) closed at a four-year low at 339.53 points yesterday, down 118 percent from its highest record of 740.93 points on July 7 this year.
Bailout
In mid-October, the Indonesian government asked the International Monetary Fund (IMF), the World Bank and the Asian Development Bank for help and received a US$23 billion bailout financial package. Other bilateral agreements were also made available to supplement the financial package.
The government has taken several financial reform measures since November, including the closure of 16 banks.
De Tray believed Indonesia would be able to come out of the monetary crisis if it stuck to the short- and long-term measures in dealing with the monetary crisis.
He said the government should also be willing to undertake necessary financial, cultural and infrastructure changes to ensure a smooth transition.
Executive director of the Centre for Strategic and International Studies (CSIS) Mari E. Pangestu shared De Tray's view, saying that the monetary crisis stemmed from the lack of confidence in the market.
She questioned the decision to seek the IMF financial bailout package as the best way to resolve the crisis. "I think the monetary crisis Indonesia is now facing is a leadership crisis instead, " she said.
"Indonesia's macroeconomic policy is okay, but I doubt the IMF package is the proper solution," she said.
Jakarta Post - December 18, 1997
Jakarta – President Soeharto found it extremely difficult to understand why the rupiah had continued to fall against the U.S. dollar, a senior minister said yesterday.
The President therefore ordered economic officials, assigned to handle the monetary upheaval, to closely monitor the situation and keep him posted of the latest developments, Minister/State Secretary Moerdiono added.
"The Monetary Council and the President himself have found it extremely difficult to understand why the rupiah dropped to such a low level," Moerdiono said after meeting with Soeharto at his residence on Jl. Cendana Central Jakarta.
Asked about the government's measures to cope with the financial chaos, Moerdiono said: "I think it's an important time for introspection. We do not need to blame one another but the government will do its best to overcome the currency crisis. We try to give people results, not just promises."
The rupiah fell to a historic low of 5 980 to the dollar on Tuesday, but has since recovered to about 5,500 yesterday. Despite mounting pressure, Moerdiono reaffirmed the government's position that Indonesia would not reschedule its foreign debt.
"We never think about a rescheduling Indonesia will try as hard as it can to fulfill its obligations," he said.
Minister of Finance Mar'ie Muhammad had said earlier that the country's foreign debt totaled US$117 billion as of September, including $65 billion owed by the private sector.
The state secretary rejected allegations from some analysts that the International Monetary Fund's (IMF) prescription had failed to cure the country's ailing economy.
"Indonesia sought help from the IMF, and it fully supports our programs... Other countries are also facing similar problems like us... This is a great turmoil and we need some time to solve the problem," Moerdiono said.
Soeharto also summoned State Minister of National Development Planning Ginandjar Kartasasmita and Minister of Industry and Trade Tunky Ariwibowo to his residence yesterday.
Soeharto ordered Ginandjar last week to intensify relief operations to drought-hit regencies in Irian Jaya. He was also ordered to provide labor-intensive projects in big cities, including Jakarta and Surabaya, to employ laborers.
Trade surplus
Tunky said after the meeting that Indonesia enjoyed an international trade surplus of $7.7 billion in the first three quarters of this year, resulting from total exports of $39.5 billion, compared to imports of $31.8 billion.
The exports represented a 9 percent increase over the same period last year and imports were down 0.5 percent.
"Our non-oil and gas exports totaled $30.8 billion, or 10.3 percent higher than last year ... while non-oil and gas imports were about $28.8 billion or 2 percent less," Tunky added.
Tunky said the country's imports declined due to the impact of the financial crisis and the rupiah's sharp depreciation against dollar.
New York Times - December 13, 1997
Seth Mydans, Tangerang – When economists worry about Indonesia's slump – its sinking currency, its ailing banks and its nearly $40 billion bailout package – they worry about people like Jumaluddin, a low-paid factory worker with a ready smile and a precarious future.
In nine years at a shoe factory here, he has begun to save a small nest egg. He is the first in his family to do so, and has been able to dream about an even better future for his 3-year-old son.
But his country's economy – after a prolonged economic boom that has produced office towers, traffic jams and relative prosperity for millions – has sharply slowed. As the country's macro- economic ills trickle down to people like Jumaluddin, who has already seen friends and colleagues lose their jobs, many are bracing themselves for a period of rising prices, high unemployment and, perhaps, social unrest.
For international investors and business executives, this is a wait-and-see time.
"It is a very volatile environment: No clear pattern has been established in terms of the exchange rate," said Daragh Maher, an economist at the ING Barings securities firm in Singapore. "It's not all-bets-off at this point, but I would be surprised if projects haven't been delayed or are waiting for a more stable environment."
While the economic crisis is not expected to prevent President Suharto, 76, from winning re-election to a seventh five-year term next March, Indonesia appears to have entered the most painful and delicate period since Suharto came to power in 1965.
This was underlined by reports that Suharto was ill – initially denied by family members and Indonesian officials, but given fresh credence on Friday, when State Secretary Moerdiono announced that the president was canceling his travel plans, including a trip to Malaysia for a meeting of regional leaders. Moerdiono said that Suharto was not sick, but that he was resting on doctor's orders.
The Indonesian currency, the rupiah, plummeted to a record low Friday, dropping 11 percent, to 5,015 against the dollar.
"Indonesia has never had a combination of an economic crisis and a political crisis at the same time," said Laksamana Sukardi, a banker who supports the country's politically weak opposition.
"We have to change," he said. "We can't any longer ignore the problems in our fundamental economic structures: the monopolies, the corruption, the lack of transparency, the lack of an even playing field."
There have been mixed signals as to whether Suharto is serious about changes, particularly those that might impinge on the economic interests of his family and friends.
While the country's belt-tightening is beginning to affect farmers and workers who live on the edge of poverty, the long- term effects on those close to the president remain to be seen. A bank controlled by the president's second son, Bambang Trihatmojo, was forced to close in November because it had made excessive loans to companies controlled by shareholders. But Trihatmojo was able to buy another bank days later.
The crucial test, said Dennis de Tray, the Indonesia representative of the World Bank, is openness – the kind that will reassure investors that the rules of competition and fairness are playing their roles.
"But you don't throw a switch and fix transparency," he said. "It takes a while to do that."
The economic crisis has bitten deeply into the lives of many workers. One- fourth of the 8,000 employees at the factory where Jumaluddin works have lost their jobs in a month. At the same time, prices for staples like rice, vegetables and cooking oil have begun to rise.
"I'm having a tough time," said Jumaluddin, 32, who lives with his wife and son here in this overcrowded factory town just west of Jakarta, the capital. Like many Indonesians, he uses only one name.
"It's not like before," he said, his tiny dormitory room lighted by a candle because the electricity had failed. "I don't have enough to live on. And there are all sorts of rumors about more people being laid off. The future's a question mark." With a population estimated around 200 million, Indonesia is the world's fourth-largest nation. Its steady economic growth rate until recently of about 7 percent a year had been just sufficient to absorb the 2.5 million young men and women who entered the work force.
That growth is projected to fall to about 5 percent this year, and the International Monetary Fund, which led in devising the bailout package, has set a target of just 3 percent growth for Indonesia next year as part of the austerity program.
"That means 2.5 million people are going to have a very hard time looking for jobs," said Sofyan Wanandi, a leading businessman who heads the Gemala Group, a conglomerate with interests in banking, insurance, automotive parts and pharmaceuticals. "I foresee in the next six months to a year layoffs of about a million people all over Indonesia. And there's not much the government can do.
For many young people, the deceleration of the economy is baffling but not disastrous. "If I lose my job, I'll just go home and get married – if anyone will have me," said Sripa, 22, a young woman in the workers' dormitory near the shoe factory here. Her friend Suparni, 20, still saw opportunity. If the layoffs affect her factory, she said, "we'd look for other work."
"We'd start our own business," she continued. "Why not? We can start small and grow big."
Such ingrained optimism has helped keep the economic and political structures of the country intact.
"The growth of the economy has always been a buffer against political dissatisfaction," Wanandi said. "That's why we have had stability for the past 30 years. Now we face the problem of lower growth. So there could be more of these accidents."
He was referring delicately to riots that have flared through the country for 18 months or so, fed by grievances ranging from ethnic and religious clashes to police misconduct to land seizures by powerful business interests.
The Asian financial crisis that began in Thailand with the floating of its currency early in July reached Indonesia this autumn, sending the rupiah sliding.
On Oct. 8, the government accepted a $10 billion standby loan from the International Monetary Fund, accompanied by help from the Asian Development Bank, the World Bank and other sources that brought the package to $18 billion.
In addition, Singapore, Japan, Australia, Malaysia, Brunei and the United States – with a $3 billion contribution – are providing additional help. The total package would amount to nearly $40 billion. The country put together an austerity program that includes a gradual reduction of import tariffs, deregulation of some government-supported commodities, a reduction of taxes and other obstacles to exports, and a review of public spending.
"It's quite a major policy shift," said Neil Saker, an economist at Societe Genrale Crosby Securities in Singapore. "They are making fiscal, monetary and structural changes and delivering everything that the IMF, the World Bank and their own technocrats have been arguing for a long time."
He expressed reserved optimism that Indonesia's healthy growth could resume in 1999, but said that 1998 would be "a very difficult year."
Australian Financial Review - December 15, 1997
Greg Earl, Jakarta – Indonesia is facing the first serious annual contraction in its economy since President Soeharto came to power amid fears that the country can no longer service its foreign debt because of the rupiah's dramatic plunge.
Mr Soeharto attempted to dispel rumours about his health with a sombre appearance on State television late Saturday night in a direct broadcast of a religious ceremony to commemorate the death of his wife last year.
Fears that the country would be forced to seek a debt moratorium caused the rupiah to plunge to more than 5,000 to the $US on Friday as the financial markets were also unnerved by new fears about the health of Mr Soeharto.
In the television broadcast from his home Mr Soeharto declared that he was well, although the setting of the President's first live public appearance in a week is unlikely to quell the speculation about his health throughout Jakarta and foreign financial markets.
"After becoming totally healthy in these 10 days, I still need to return to my previous condition," he said. "Hopefully, everything will proceed well because all this can only be by the grace and blessing of the God Almighty."
His decision not to send the vice-president, Try Soetrisno, as his replacement to the East Asian leaders summit in Kuala Lumpur today is also generating new uncertainty about the country's leadership succession.
Indonesia's foreign debt of about $US110 billion is now larger than its gross domestic product this year which used to be valued at about $US230 billion before the currency crisis.
The servicing cost of the foreign debt has gone from around 5 per cent of total output to 10 per cent, imposing a massive new burden on the economy next year, but that pales beside the estimated foreign exchange loss on unhedged private sector foreign debt which is now more than 20 per cent of GDP.
The entire capitalisation of the Jakarta Stock Exchange is now valued at only about half the total foreign debt and is significantly less than the unhedged foreign debt.
Some private sector economists are now slashing their 1998 growth forecasts to a contraction of at least 2 per cent next year compared with around 3 per cent growth only a month ago when the exchange rate was recovering with the assistance of the International Monetary Fund assistance package.
That could seriously undermine Mr Soeharto's hold on the country because he has anchored his 32 years in power in consistent economic development which has seen average economic growth or around 6 per cent but levels closer to 8 per cent in recent years.
The only time the economy has experienced marginal negative annual real growth in the Soeharto era was in 1982 when falling oil prices and the mounting cost of accumulated debt caused a sudden reduction.
"I think they have now run out of options. Indonesia is in a worse position than Thailand. The debt is worse and the political situation is worse," said SocGen-Crosby regional economist, Neil Saker.
But the Finance Minister, Mar'ie Muhammad, said in New York at the weekend that growth next year would still reach 4 per cent and that the Government was still committed to meeting its IMF reform agreement.
He said he was optimistic Indonesia could overcome the difficulties associated with the reforms and that Mr Soeharto was in good health and focused on fixing the economy.
Many financial analysts were speculating on Friday that Indonesia would need to arrange a debt moratorium because of the risk that the IMF assistance package is not enough to defend the economy although it is unclear how a moratorium would be arranged for private sector debt.
The Latin American debt moratorium and restructuring of the 1980s was essentially dealing with public sector debt but took several years to put into place.
Mr Soeharto dispatched the country's Minister for Foreign Affairs, Ali Alatas, and the Co-ordinating Minister for Production and Distribution, Hartarto, to represent him at the Association of South-East Asian Nations summit, continuing a tradition of rarely allowing the Vice-President to represent Indonesia abroad.
While Mr Try has been handling more domestic duties in the past week during Mr Soeharto's rest, he is thought to have made only one trip abroad as Vice-President, to Australia in 1994.
While Mr Try's political credentials are unclear, many people see his as the best candidate for a smooth transition of power but Mr Soeharto has persistently avoided elevating him to the status of a successor.
Jakarta Post - December 11, 1997
Jakarta – The World Bank country director for Indonesia, Dennis de Tray, suggested yesterday that the government send signals to the market that it would undertake reform measures to restore public confidence.
De Tray said he was optimistic the country's monetary crisis would ease shortly provided the government stuck to its promised reform programs.
Once the government sent strong, clear signals to the market that they would undertake reform measures, the situation should ease, he said.
"In the medium-term, there is great hope for optimism. But we need to get through the short-term and we need to do that quickly," de Tray said at a business luncheon hosted by the Indonesia-Australia Business Council.
"It needs to signal to the people and to the world in a transparent way.
"I think the signal that the market is sending is that the government should implement a broad package. This is very important to restore domestic confidence, " he said.
Unlike Thailand, de Tray said, Indonesia's monetary crisis was very much driven by domestic forces rather than by offshore players.
Indonesia has been badly hurt by the regional financial crisis which broke out following the devaluation of the Thai baht in early July.
The Indonesian rupiah fell to a historic low of 4,600 against the U.S. dollar Tuesday, down over 50 percent since the beginning of the year, and the stock market index traded last week at a four- year low.
Indonesia asked the International Monetary Fund the World Bank and the Asian Development Bank for help in October and received a bail-out package of US$23 billion. Bilateral agreements also were made to supplement the package.
De Tray said the government should now move from its short-term measures to long-term ones by addressing all problems outside the finance sector, including the public sector, to satisfy market expectations.
"The interest rate route is very good, but it is short term. It needs to be accompanied by long-term reforms outside the finance sector," he said.
If the government blended its short-term measures with long-term ones correctly, de Tray said he was confident that Indonesia would come out of the crisis very soon.
"There is a very strong sense that this is a short-term financial crisis that needs to work its way out of the system," de Tray said.
"After that, there is every reason to believe that Indonesia can return to high growth, substantial foreign investment and a real increase in the incomes of the Indonesian people," he said.
De Tray said the government needed to take very transparent decisions in terms of public resources spending, including in financing foreign exchange-consuming strategic industries.
He warned that Indonesia needed to be very careful in moving toward high capital and high technology costs as it had proved to be dangerous in the past in many other developing countries.
"We argue that state-owned enterprises, including strategic industries, need a very good handle. So when they make a decision on them, they should do it very transparently, so there's no second guessing," he told journalists after the luncheon.
"And the public has the right to know what the future is," he said.
The Economist - December 13, 1997
Nothing, until recently, has stood in the way of the sons and daughters of President Suharto, as they built up huge business empires through his 30-year reign. Democracy is controlled, the opposition neutered, the press harnessed. But at last something has happened to restrain them: Asia's economic crisis.
On December 5th, shortly after he returned from a long overseas trip, Mr Suharto promptly disappeared; the government said he was taking a much-needed ten-day rest at home. But within days, rumours were swirling that it was worse than that: that Mr Suharto had had a stroke, was gravely ill, or had even died. The Indonesia rupiah fell 10 per cent as the rumours intensified on December 9th. Although the wilder tales were quickly denied (a tummy bug is the latest explanation for his withdrawal, and Mr Suharto, it is promised, will be back at his desk next week) the strain of the country's financial turmoil is clearly showing on both the president and on his family.
The continuing currency crisis, which led the country to accept a $38 billion IMFsponsored rescue last month, is forcing some humbling change on the Suharto clan. The government has shut several banks owned by a son and daughter of Mr Suharto. The son, Bambang Trihatmodjo, who controls the Bimantara Group, complained that the finance minister had a hidden agenda, and did not consult his father before closing his bank; but his father did nothing to save him.
Indonesia's technocrats may be using the economic crisis as an opportunity to deregulate "taboo" sectors – shorthand for businesses owned by the family. Petrochemicals, for instance, is a sector owned largely by Mr Bambang and Sigit Harjojudanto, his eldest brother. Even so, the government recently slashed import tariffs on key products. Last month Tommy Suharto, Mr Suharto's youngest son (and reputedly his favourite) was summarily ousted from the top job at PT Timor Putra Nasional, a controversial project to build an Indonesian car. Tommy's "informal" management style and his tendency to install inexperienced friends to run the venture apparently infuriated the government. Indonesia is now facing action from the World Trade Organisation for its high import duties on competing cars.
Earlier this year, a local credit-rating agency downgraded Sempati for its "deteriorating" financial condition – a first for a firm owned by the clan. And last week Pertamina, the national oil company, made a disclosure, astonishing even by Indonesian standards, that Sempati Air, an airline in which Tommy has a big stake, owes it some $3.sm in fuel charges.
Delays on grandiose infrastructure projects have hit other members of the family. Siti Prabowo, one of the president's daughters, had a slice of a $10 billion venture linking Malaysia and Indonesia over the Malacca Straits. The project has been postponed. Her eldest sister, Siti Hardiyanti Rukmana, managed to save her own bank from liquidation, but several of her toll-road projects have been frozen. To the annoyance of the IMF, the government has revived several power projects owned by the family. But since sources of finance for such infrastructure ventures have evaporated, there is no money to continue the construction anyway.
For the First Family, the tight-fisted approach of the state banks must come as a rude shock. Before the currency collapsed in July, the Suharto clan could walk into any state bank and demand a loan at favourable terms. Now the seven state banks are under pressure from the IMF and World Bank to improve their flagging performance. In May, a consortium of state and private banks was told to put together the first $100m installment of a $690m loan for Tommy's car firm. When the loan came through last month, it was less than $25m.
As if all that were not bad enough, the Suharto family has also lost its favoured status in privatisations, the biggest contributor to its wealth in the early 1990s, when the government awarded the family juicy contracts in power generation, telecommunications and toll-roads. A new privatisation board set up under the watchful eyes of multilateral institutions to supervise future sales of state assets may spell the end of such titbits.
For all the Suharto-family businesses that have been shut down or hobbled, many more remain untouched. But the First Family has been shielded in the past from the mundane aspects of running a modern business – boring details such as cash management and stock control. Now the banks may not be willing to bail them out. Neither, it seems, is Daddy.
| Politics |
Financial Times - 18 December 1997
Sander Thoenes – The prospect of a sixth smooth re-election of President Suharto next year was put in doubt this week when a leading party failed to nominate him and a group of retired generals called for a new president.
The United Development party (PPP), one of only three parties represented in parIiament, failed to endorse any presidential candidate after three days of debate.
For the past two decades the Moslem PPP has played its part in a nationwide clamour to nominate Mr Suharto for every election. But newspapers said several branches of the party preferred to nominate Ismail Hasan Metarellm, the party chairman, or Amien Rais, an outspoken Moslem leader. Mr Ismail denied reports that his party's failure to endorse Mr Suharto was linked to persistent rumours about the president's health.
Mr Suharto, 76, has been resting for 12 days but said he would attend a military graduation today. His pledge helped bring back the rupiah and stock market from record lows yesterday.
On Tuesday, a well known group of retired generals and officials cited the economic crisis as grounds for urging the MPR, a hand- picked assembly that will meet in March, not to re-elect Mr Suharto and to abide by Indonesia's first constitution, which limits a president to two terms.
'If this is done, the road to political reform and democratisation on the basis of popular sovereignty can begin in a peaceful and constitutional way," said the group, which calls itself the Petition of Fifty.
Only students and fringe groups have so far dared call for the retirement of Mr Suharto. "Unlike just a few months ago, the continuance of this presidency is now in doubt," a western diplomat concluded.
Ali Sadikin, former governor of the Jakarta region and leader of the Petition of Fifty, denied harbouring ambitions for the presidency and said he favoured Amien Rais or Megawati Sukarno putri, daughter of the late President Sukarno.
The Petition of Fifty provoked Mr Suharto's anger in 1979 and 1980 with appeals for political reform and redefinition of the military's role in government. General Edi Sudradjat, minister of defence and security, said yesterday rumours of a coup were unfounded.
Jakarta Post - December 18, 1997
Jakarta – Siti Hardiyanti Rukmana threw in the towel in the race for the vice presidency yesterday, saying she was not capable of carrying out the second top position.
The eldest daughter of President Soeharto said on the sidelines of the People's Consultative Assembly meeting that the nation needs a person of high quality for its vice president.
"I feel I'm not ready for the position, (because) it requires a broad mind and boldness. I don't fit that position at all, particularly because I lack knowledge to cope with complicated state matters," said Hardiyanti, who is more popularly known as Mbak Tutut.
Hardiyanti has so far been the only female candidate for the vice presidential seat, as far as nominations for the national leadership posts brought to the attention of the Assembly's working committee are concerned.
The committee's list of candidates includes incumbent Try Sutrisno, House Speaker Harmoko, Minister of Information R. Hartono Minister of Research and Technology B.J. Habibie, Armed Forces Chief Gen. Feisal Tanjung, Army Chief of Staff Gen. Wiranto, government critic and chairman of Muhammadiyah Moslem organization Amien Rais and chairman of the United Development Party Ismail Hasan Metareum.
Chairman of the country's largest Moslem organization Nahdlatul Ulama (NU), Abdurrahman Wahid, was among the last to support Hardiyanti's nomination during the NU's congress last month.
The Assembly will convene in March next year to elect a president and vice president. The election of a vice president requires approval from the elected president.
Hardiyanti said that Assembly members must seek her acceptance first if they nominate her.
"The nomination is not decided by the Assembly and the elected president alone but the candidate him or herself," she said.
"I thank those who have supported me, but do not nominate me only because I often visit people in villages or appear in newspapers."
Hardiyanti, whose head scarf is her trademark, holds a lot of top positions in business, political and social organizations. She leads one of the country's largest holding companies PT Citra Lamtorogung, chairs the Indonesian Red Cross and several charity foundations and holds the deputy chairmanship post in the dominant political group Golkar.
Since the death of her mother, First Lady Tien Soeharto, Hardiyanti has accompanied Soeharto in state duties more often.
Hardiyanti said yesterday she never talked with her father about her nomination for the vice presidency.
"We don't have time for such a talk. Besides, this is not the appropriate time to discuss that. There's still three months to go," she said.
Jakarta Post - December 18, 1997
Jakarta – Minister of Defense Edi Sudradjat told people yesterday not to be provoked by baseless rumors about a coup attempt.
Speaking to reporters after addressing the opening ceremony of an ASEAN seminar on Principles of Regional Resilience and Cooperation, Edi said people should not trust such misleading information.
"The coup attempt turned out to be untrue, didn't it?" he said during a break in the two-day seminar organized by the National Resilience Institute (Lemhanas).
He said citizens should maintain vigilance and not be easily provoked by irresponsible rumors aimed at creating political and economical instability.
"People should be able to filter all kinds of information and remain wary of any kind of provocation," he added.
Businessman and legislator Bambang Trihatmodjo also called for vigilance in responding to the rumors.
"People should be more cautious about the rumors, which have been launched in such an unfavorable political and economic climate," said Bambang, who is President Soeharto's son.
Edi and Bambang were commenting on the wide spread rumors, which had been brewing since Monday saying that there would be a coup attempt Wednesday.
Rumors of the coup attempt destabilized the country's economic system and depreciated the rupiah against the U.S. dollar.
The rupiah fell on rumors of President Soeharto's ailing health last week. Earlier, foreign reports even speculated that Soeharto was on his deathbed.
But none of the rumors have proven to be true.
The Armed Forces vowed last week to track down those who circulated rumors which it said threatened the country's economic and political stability.
But Edi dismissed speculation that there were foreign countries who were behind the monetary crisis and involved in starting the rumors.
Speaking on efforts to tackle the monetary crisis, Edi said all elements in society should be serious and do their best to settle the crisis. But he said the government should prioritize the steps to be taken.
"There are things which require an immediate response, while others may have to be delayed or canceled," he said.
[Denials about a military coup were first made by Hashim Djojohadikusumo, businessman brother of Mmajor-General Prabowo, who went out of his way to stress that his brother was currently in London, the implication being that Prabowo was rumoured to be behind the coup.]
The Nation - December 18, 1997
Andreas Harsono, Jakarta – As the Indonesian government ventures to overcome the current monetary crisis, rumours have started to circulate widely of an impending military coup in connection with the health of Indonesia's strong man, President Suharto.
Businessman Hashim Djojohadikusumo broke open the issue last Monday when he denied the existence of an impending coup, saying that his brother, Maj Gen Prabowo Subianto, the commander of the Kopassus elite command and the son-in-law of President Suharto, was in London.
"If there is a [serious] problem inside this country, he must be here. But he is in London. It shows that he is confident about our national security," said Hashim.
Rumours about a coup began to circulate in Jakarta last week and gained momentum when Singapore's Straits Times reported last Sunday that there was widespread speculation that an impending military action would take place.
But the Singaporean newspaper did not provide details of the rumour. It merely quoted Maj Gen Zakie Anwar Makarim, the chief intelligence officer of the Indonesian Armed Forces (Abri), lashing out at "groups with leftist leanings" for spreading such rumours.
"These are lies. They want to destabilise the economy and cause a crisis," Makarim said, who is a close associate of Prabowo.
"All this talk of a planned coup is nonsense because Abri is united in its support for the president. I can vouch for that, because as head of military intelligence, I know what's going on," he said.
Rumours of a coup apparently surfaced after the army had conducted two different military training exercises last week while government spokesmen announced that President Suharto had cancelled a planned trip to attend an Asean summit in Kuala Lumpur due to health problems.
The announcement apparently helped fuel rumours that different factions within the military were anticipating more serious health problems which might lead to a power struggle for the No 1 position.
Suharto's decision not to send Vice President Try Sutrisno, a former army chief, as his replacement to the Kuala Lumpur meeting had also generated uncertainty about Indonesia's leadership succession.
Diplomats and political observers here also believed that Singaporean diplomats in Jakarta were the best sources concerning sensitive information.
Straits Times correspondent Susan Sim, however, denied that her colleague, Derwin Pereira, had received any rumours from the Singapore Embassy. Sim said that her assistant simply wrote about the rumours which were already widely circulated here.
An Internet-based underground news service, Siar, reported yesterday that military preparations were apparently being made to anticipate public protests and to protect President Suharto if the ongoing economic crisis turned violent.
The first training exercise took place on Dec 9 in the Tegal Gundil area in Bogor, around 80 kilometres south of Jakarta, involving thousands of military personnel in an anti-riot exercise, which created heavy traffic jams as most Bogor streets were closed.
The second exercise was held on Dec12 in the Kemayoran area in Jakarta. It involved 7,000 police and army personnel as well as helicopters and other military vehicles. Jakarta Police Chief Maj Gen Hamami Nata and Jakarta military commander Maj Gen Syafri Syamsudin personally oversaw the exercise.
Indonesia's foreign debt of about US$110 billion is now larger than its gross domestic product this year, which used to be valued at about $230 billion before the currency crisis.
The cost of servicing cost the debt has risen from around five per cent of total output to 10 per cent, imposing a massive new burden on the economy next year. But that pales beside the estimated foreign exchange loss on unhedged private sector foreign debt, which is now more than 30 per cent of GDP.
Analysts said the economic problem could seriously undermine Suharto's hold on the country, because he has anchored his 30 years in power on consistent economic development, which has seen average economic growth of around six per cent, although it has been closer to eight per cent in recent years.
The underground news service, a common phenomenon here where the free flow of information is frequently restricted, reported that Bogor and Kemayoran were where left-leaning army officers made their preparations to conduct a failed coup attempt in 1965.
The coup attempt, however, cornered President Sukarno, resulting in Suharto, then a major general, taking over power and replacing Sukarno.
Associated Press - December 16, 1997
Ali Kotarumalos, Jakarta – A dissident group of former Cabinet ministers, ex-politicians and retired generals urged Indonesian lawmakers Tuesday not to re-elect Asia's oldest and longest reigning head of state.
The call by the Petition 50 group coincided with news that President Suharto, who is seeking a seventh consecutive term next March, plans to return to work Thursday, ending a two-week rest at home.
In a letter to the People's Consultative Assembly, the group said that Indonesia's financial crisis was a consequence of bigger social, economic and political problems brought on by Suharto's government.
"Actually, as a nation, we are experiencing ... the crisis of morality and life, the crisis of its existence as a nation," the group said.
It said the 1,000-member assembly could improve democracy in Indonesia by changing regulations that tightly control the political system and by not electing Suharto for the 1998-2003 presidential term.
Despite the group's urgings, the assembly is expected to elect Suharto unopposed.
The 76-year-old retired army general came to power after he crushed an unsuccessful communist coup in 1965. Since then, Suharto has tolerated little dissent in his pursuit of stability that has resulted in spectacular economic growth for the world's fourth most-populous nation.
The dissident group noted that when Suharto took office, he had promised democratic reform to correct mistakes made by his predecessor, President Sukarno, who founded Indonesia in 1945 and ruled until it sank into turmoil in the mid-1960s.
"But in fact, the people's sovereignty was ignored. The nation is ruled in an authoritarian way without effective political and social control," the group said of Suharto's time in office.
In the past two weeks, doubts have lingered about Suharto's health. He was last seen in public Dec. 3, when doctors ordered him to rest after a long overseas trip.
Indonesia's currency and stock market sank dramatically last week amid wild rumors that he was seriously ill, or even that he had died. The massive market sell-off has worsened a serious economic situation for Indonesia, which has received a $40 billion rescue package from the International Monetary Fund. Suharto's return to work Thursday includes an appearance at a military cadet graduation ceremony at Jakarta's presidential palace, said a government official, speaking on condition of anonymity.
[The Petition of 50 (Petisi 50) is a group which emerged in 1980 lead by discontented elements of the elite from two traditional political stream, nationalism and Islam along with a number of former military officers. The groups issued a petition, signed by over fifty people, which raised issues of democratic rights and accused Suharto for seeing himself as the personification of the state ideology, Pancasila - James Balowski.]
Kompas - December 16, 1997
Jakarta – The Working Committee of the People's Consultative Assembly (BP MPR) has received eight names proposed as candidate for VP. While as candidate for president 1998-2003 only one name was proposed, namely that of President Soeharto.
The BP MPR Chairman Pudjono Pranyoto said this Monday (13/12) to reporters in Jakarta after receiving the delegation of NTB (the Western Lesser Sundas). He added that the proposed names are Try Sutrisno (VP), Harmoko (MPR/DPR Chairman), BJ Habibie (State Minister for Research and Technology/Chairman of the Agency for the Assesment and Application of Technology (BPPT), Ginandjar Kartasasmita (Chairman of the National Development Planning Board (Bappenas), Feisal Tandjung (Chief of the Armed Forces), Edy Sudradjat (Minister of Defense and Security), Hartono (Minister for Information), and Wiranto (Army Chief of Staff).
Pudjono clarified that 10 delegations proposed the Preesident's name while the names for VP was proposed by three delegations - The Central Managing Board of the Defenders for the Fatherland's Unity, the Association of the Christian Society in East Indonesia and the Institution of the Paniai Tribes Society in Irian Jaya, and 11 written statement which he had conveyed to the MPR fractions.
At the same day the delegation which alleged to represent the NTB society conveyed their support of HM Soeharto's candidacy as RI President.
The AustralAsian - December 15, 1997
Andreas Harsono, Jakarta – The main streets in Jakarta's business district were crowded on Friday. Amid the skyscrapers, Jakartans rushed home for the weekend, and everything seemed normal.
But Friday, Dec 12, was unusual. A few hours earlier, Indonesian Cabinet Secretary Moerdiono made an announcement that some had anticipated and many had feared – that President Suharto had cancelled his trip to Kuala Lumpur due to what Moerdiono characterised as fatigue, but many believe it was something much more troubling.
"I announced a few days ago that the President was planning to attend the Asean informal summit. However, after a routine checkup, the presidential doctors advised him not to go on any long journey for the time being," Moerdiono said.
Just minutes after the announcement, the Indonesian rupiah and the stock market plunged to new uncharted lows, forcing the rupiah to break the critical 5,000 barrier to a new record of 5,225 against the dollar in the spot market.
It is widely understood that Suharto's presence at the Kuala Lumpur summit would have lent the Asean's meeting special significance, as he is the only founding leader remaining in power since the regional grouping was established in Bangkok in 1969.
Rumours, however, began to circulate widely that the 76-year-old Suharto had suffered a minor stroke after concluding a 12-day trip to Namibia, South Africa, Canada and Saudi Arabia earlier this month. The ageing president was even rumoured to have died on Dec 5, pushing the rupiah through the 4,000 psychological barrier to end up losing more than 50 per cent of its initial value of 2,500 in July.
In a apparent bid to confront the rumours, state-owned television TVRI showed Suharto meeting Moerdiono and Foreign Minister Ali Alatas in Suharto's private residence on Friday, during which the pale-looking and puffy-eyed Suharto, clad in a dark yellow batik shirt, was shown sitting on a sofa. Other than smiling and nodding a number of times, Suharto did not make many gestures.
The footage, instead of calming the rumours, raised more speculation. Some said Suharto had to be helped to sit on the sofa. Others said he could not move his left hand. The event has obviously shocked most Indonesians, especially those born under Suharto's rule, who are discouraged from even thinking that Indonesia may need a younger president to replace Suharto.
Australia-based Indonesian watcher Prof Hal Hill said it is also obvious that Suharto is old and tired. Since he took power in 1965, Suharto has built an arrogant and corrupt bureaucracy and a powerful military unaccustomed to listening to the masses. But it survived because it brought an economic boom. People could buy food and have better clothes. Economic development is frequently used as a pretext to silence the media, to harass the opposition, to crack down on unions and to jail dissidents.
"Suharto is over. It's only a matter of time," predicted an Indonesian veteran activist. He explained that the monetary crisis had prompted the birth of a still-embryonic political crisis with three features.
First, he said, is the fragmentation of the highly centralised political power of the regime. Suharto is not as strong as he was, resulting in his own supporters fighting with one another. Second, the activist said, the bureaucracy is unable to reach for whatever grassroots support Suharto might have. Third, a mass political movement is likely to emerge when people start to realise that there is a chance to fight Suharto and his cronies.
Another veteran, who is widely known to be a pessimist and was once part of Suharto's Golkar ruling party, suddenly appeared at elite gatherings saying that the end of the Suharto era is only "a matter of weeks" away.
Many believed that the political tension is likely to heat up between January and March. At the end of January, most Indonesian Muslims are expected to celebrate the end of the Ramadan fasting month when people usually come home, buy more food and wear new clothes. Workers expect their employers to give their annual bonuses, as food prices soar. But the question remains whether employers have money to pay.
And next March, the Indonesian People's Consultative Assembly is due to elect a new president and vice president. Suharto is expected to enter his seventh five-year term unopposed, and tradition dictates that the vice presidential candidate is handpicked by him.
But Suharto's health has made the number one position a hot seat. Under the Indonesian constitution, the vice president should take over if the president has to step down while in office.
Suharto's aides, like Minister of Research and Technology B J Habibie, Minister of Information R Hartono, army chief Gen Wiranto as well as Vice President Try Sutrisno, are all likely to be involved in a race for power along with their respective allies if Suharto's health continues to fail.
Other players, like former vice president Sudharmono or dark horses like National Planning Minister Ginanjar Kartasasmita and House Speaker Harmoko, as well as Suharto's eldest daughter, Siti Hardiyanti Rukmana, are all likely to be involved in the bid for power.
As if knowing that the March election might create a staging ground for political unrest, Indonesian military commander Gen Feisal Tanjung issued a peremptory warning to those who sought to disrupt the plenary by "excessive interruptions, walking out of meetings or taking votes".
Tanjung said the armed forces is prepared to take action against "those people", although analysts here doubt whether Tanjung can still control his generals and other younger officers who are now apparently seeking new sponsors in the absence of a common platform of support for Suharto.
"Suharto has no vision," said the veteran activist. "He does not even know what he should do with the monetary crisis. Even the World Bank is not happy with the way Suharto resisted the recovery measures."
Perhaps, as they sat trapped in the Jakarta's traffic last Friday evening, motorists were already beginning to think, "How serious is his illness? What will happen if the old man dies?" Or, they might ask themselves, as novelist Mochtar Lubis did in his book "Twilight in Jakarta", which is about the final days of the late President Sukarno in the mid-1960s, "Is Indonesia seeing another twilight?"