Democratic struggle

'Reformasi' disenfranchised: Sutiyoso and Komnas HAM

Jakarta Post - July 20, 2002

Max Lane -- Two recent developments in the political scene underline clearly how the reformasi sector of society has become disenfranchised from the political process.

During the last 10 years of the Soeharto New Order dictatorship a social sector developed comprising advocacy organizations (NGOs), human rights institutions, trade unions, peasant organizations, women groups, even anti-dictatorship political parties, student activist coalitions and, most importantly, scores of action committees around different local issues.

It was this large, but dispersed, sector, led by the student movement that forced Soeharto's resignation and invented the term reformasi. But this sector has been quickly disenfranchised; marginalized from the decision making process of government and legislature.

This marginalization is very evident in the case of the selection of the next governor of Jakarta. The major parties, at least at the national leadership level, are supporting the current governor, Sutiyoso.

Sutiyoso, military commander of Jakarta the last years of the New Order, cannot in any way be seen as a product or representative of the "reform" sector. If anything, Sutiyoso must be categorized still as a representative of the New Order era, who has survived into the era reformasi.

There have been several well-known personalities who have come forward from the reformasi sector to register as candidates of the governorship. These include a leading activist from the urban poor sector, Rasdullah a leader of many of Jakarta's pedicab drivers, as well as women activist Ratna Sarumpaet and human rights activist, Nursyahbani Katjasungkana, who is standing as a candidate for Deputy Governor. From the Indonesian Democratic Party of Struggle (PDI Perjuangan) itself there is also a candidate who directly reflects the reformasi sector among the grass-roots of the party.

But as Endy Bayuni pointed out in The Jakarta Post on July 8, these candidates have no real chance of competing for the position of governor because the public itself, society itself, has been excluded from the process. The public is excluded from the process insofar as it can be said that the existing dominant political parties have become alienated from the public and are perceived as instruments of the elit politik rather than representatives of some popular constituency.

It is important to use the Indonesian term elit politik than "political elite" here. The alienation of the professional politicians of the parties in the legislature from the rest of society has created the term elit politik as a term with specific negative connations, inferring disinterest in the concerns and welfare of the mass of ordinary people.

There is a huge political gap between this elit politik and mass consciousness. One reflection of this is the gap between the elit politik and the reformasi sector.

Apart from the Jakarta governorship another recent example has been the election of new members of the National Human Rights Commission (Komnas). Members of the House of Representatives from the elit politik met to vote on who should be new members of the Commission. The vote was preceded by a series of hearings before a parliamentary commission.

Among those who were candidates were a number of figures and activists from the reformasi sector, including some who have or have had reputations for being vocal and, sometimes, confrontational with the authorities.

The most high profile vocal figures of this sector were Wardah Hafidz, from the Urban Poor Consortium and Hendardi, a human rights lawyer received very low votes from the legislators. T. Mulya Lubis, a human rights lawyer who has also established a respected law firm, also received insufficient votes. As a founder of the Yap Thian Hien Human Rights Award and as a commentator, Lubis has been a vocal critic of corruption. The elit politik chose mostly non-reformasi sector people or the least vocal or confrontative to be the new members.

Indeed the major parties are not creations of the opposition process to the New Order, or where they did have some oppositional role, as with the PDI Perjuangan in 1996, that aspect of their past is being suppressed. As a result, reformasi is not represented in the House.

One of the reasons is that the reformasi sector itself has not fully realized its potential for producing a political alternative of its own. In 1996, student and worker activists formed the Peoples Democratic Party (PRD). Despite being repressed during the 1996-1998 period, the PRD has been able to survive and to maintain a significant level of activism.

Labor movement figure, Mochtar Pakpahan and anti-Soeharto figure, Sri Bintang Pamungkas, have both formed political parties. Among the scores of new parties being registered for the next elections, there may even be others that originate from among NGOs, worker or peasant organizations, women groups, the student movement or action committees.

But while there has been a national women's movement congress in 1998, there has been no general people's conference or assembly that could harness all the energies and ideas of the reformasi sector and that could hammer out a minimum set of agreed policies.

The Indonesian Peoples Forum in Bali in June, had a limited agenda and participation. At a public meeting on July 11 at the Jakarta Media Center, several figures from the reformasi sector indicated support or interest in the concept of a "peoples' congress" on how the reformasi sector could present itself as an alternative to the elit politik.

Among those who indicated some support were Revrisond Baswir, a critical economist from Gajah Mada University; Haris Rusly Moti from the Peoples Democratic Party (PRD); Akbar Zulfakkar from Indonesian Muslim Students Action Front (KAMMI), and Dita Indah Sari, from the Indonesian National Front For Labor Struggle (FNPBI).

Also present at the meeting was former president Abdurrhman Wahid. He expressed a more cautious approach, supporting the idea that some kind of unity was needed, but wanted more discussion before any concrete steps were taken.

How such a congress might be organized and what its agenda might be is still not clear. However, any step towards that might bring the reformasi sector together to move it closer to being able to present itself as a political alternative to the current elit politik.

Perhaps unity won't be achieved but the process will still help clarify which sector of the reformasi movement is willing and capable to do compete and struggle for governmental power. While this reformasi sector does not develop, the elit politik will retain a monopoly over all the major political institutions.

Instead of being the motor of change, the reformasi sector will be doomed to beg always for some minor concessions or reforms from the elite. And even this will eventually wear out.

[Max Lane is from the Center for Asia Pacific Social Transformation Studies, University of Wollongong, New South Wales, Australia.]

Labour issues

Illegals in Malaysia told to leave before amnesty ends

Agence France Presse - July 16, 2002

The Indonesian embassy appealed to all its citizens living in Malaysia illegally to return home before an amnesty period ends in two weeks.

Ambassador Hadi Wayarabi Alhadar said only 216,000 Indonesians have responded to the Malaysian amnesty, which runs from March 21 to July 31 to allow illegals to leave the country without being prosecuted.

An additional 40,000 Indonesian workers have been deported in the first six months of the year, he told reporters Tuesday. "[The amnesty] will not be extended any more, so I appeal to all the Indonesian illegal workers ... return immediately before the amnesty period ends," he said.

Hadi Warayabi said the amnesty has been "very helpful for them to return home in an orderly manner and without fear of being arrested." He said the Indonesian government was exploring plans to increase flights at possibly subsidised rates to let the migrants leave faster than the traditional ferry route.

"We will try to provide as many as possible modes of transportation back, either through flights or increasing the ferry services." The embassy has posted a huge banner at its compound in Kuala Lumpur, reading: "To Illegal Indonesian workers in Malaysia, return home before the end of the amnesty period." Malaysia, which is home to some 750,000 legal foreign workers, granted a similar amnesty in 1998.

Hadi Warayabi warned that those who failed to go home would face strict punishment under new Malaysian immigration laws to be introduced after the amnesty ends.

Under the new laws effective next month, anyone found guilty of illegal entry or harbouring illegal immigrants would face a mandatory six months in jail and/or up to six strokes of the cane.

Currently, offenders face up to five years' jail or a fine of not more than 10,000 ringgit (2,632 dollars), but courts mostly impose fines.

The government, which has said it aims to deport about 10,000 Indonesian illegals every month, in January launched an offensive against the immigrants with almost daily arrests.

Malaysia's increasing intolerance of illegal workers was also turned against legal immigrants from Indonesia after two riots in January by textile and construction workers.

The government announced that Indonesians would be hired in future only as domestic helpers and plantation workers.

430 workers complain of exploitation

Jakarta Post - July 15, 2002

Apriadi Gunawan and Jacob Herin, Medan/Maumere -- More than 430 workers from East Java occupied the North Sumatra legislature building out of fear of being traded like slaves in neighboring country Malaysia, demanding the government send them back home as soon as possible.

They were part of more than 900 workers deported through Belawan port for entering Malaysia illegally on Friday. Immediately after their arrival at the port, the workers occupied the legislature building, instead of following their colleagues to proceed to a pooling mess at Amplas, near the city.

"We shall continue to occupy the building until the governor and the legislature leadership give us an assurance that we will be sent back directly to East Java and not the pooling mess where we might be traded again to local brokers to be sent back to Malaysia via illegal channels," Irpansyah, coordinator of the sit-in told The Jakarta Post on Saturday.

The workers, mostly young women, said they were still traumatized after being traded to a labor syndicate to be employed as illegal workers in Malaysia after they had been accommodated in the pooling mess two months to six months ago. Some of the workers were forced to pay Rp 2 million (US$210) in cash to stay at the pooling mess prior to being handed over to the syndicate and other brokers.

"So far, many fellow workers of mine from Lamongan are still employed with pay in Malaysia after being deported through Belawan, and many women were brought to Riau to be employed as prostitutes," said Irpansyah.

Rosliana, 30, from Surabaya, said she had illegally entered Malaysia three times with the help of a local broker who promised her higher wages on a plantation in Malaysia. "I will no longer go to Malaysia because of the bad experience and will seek work in my home town in East Java," she said.

Agus, 25, another worker, appealed to the provincial administration to help finance their return home because most of the workers had run out of money for a bus or ship ticket to Surabaya. "We shall remain here until the governor gives us a guarantee that we'll be sent home safely," he said.

Governor T. Rizal Nurdin said the workers would be sent back following coordination with the local social affairs office.

He questioned the workers' deportation through Belawan because they were all from East Java. He said the workers should have been deported directly to Surabaya because, according to a recent agreement between Indonesia and Malaysia, deportation was made directly to the deported workers' home provinces.

In Sikka and East Flores, East Nusa Tenggara, a number of workers who had just come back from East Malaysia voiced complaints about rampant extortion by local public transport operators, due to the absence of sea transportation to the two regencies from Kalimantan.

Andreas Holi Keraf, 53, said he and many other workers had been forced to pay Rp 150,000, instead of the usual Rp 1,000, for a one-kilometer trip from Sadang Bui port to the West Terminal in Sikka recently.

"A Damai Indah passenger bus charged us Rp 500,000 each for a 150-kilometer trip from Sikka to Larantuka in East Flores," said another worker, Sesilia Peni Kewuan, 30. She said the fare from Sikka to Larantuka was normally Rp 10,000.

Students/youth

No change without youth

Green Left Weekly - July 17, 2002

Max Lane, Jakarta -- Sukarno, the first president of Indonesia, was 27 years old when he became chairperson of the Indonesian National Party in the 1920s. Mohammed Hatta was a similar age when he took over the leadership of the nationalist Pendidikan Nasional Indonesia a little later. Sukarno and Hatta were the central figures of the independence movement when they were in their 20s.

Of course, they were in their early 40s when they assumed leadership of independent Indonesia in 1945. It was repression by the Dutch colonial authorities which delayed their taking leadership of the country before then.

Before the August 17, 1945, proclamation of independence, during the guerrilla and diplomatic struggle of 1945-49 and during the next 16 years of nation building, young people provided the energy and the semangat (spirit) that ensured advances in the struggles of the people. The word semangat took on a special weight in the new Indonesian political culture.

There was a strong consciousness that society could advance only by the mobilisation of the energies of the mass of ordinary people in achieving the goals of independence.

It has been young people, especially the students, who have been the motor for political change during the last four decades in Indonesia. Every wave of reform since 1972 has been driven by the student movement.

The more than 30 years of military rule that followed dictator Suharto's seizure of power in 1965 resulted in the role of youth in political leadership being ignored. The political culture created during Suharto's New Order regime, which still prevails today, has turned against the best traditions of Indonesian history.

Today, to stand for president, a candidate must be over 40. Apart from being a clear violation of the democratic rights of citizens under that age, this provision eliminates from candidacy some of the most dynamic figures in Indonesian society and politics. One example: Dita Sari, who has won international recognition as a trade union and women's leader, cannot be a candidate for president.

This also excludes more than 70% of the population. Even for the position of governors there is age discrimination. To be a governor, a candidate must be 30 years old.

One important political outcome of the student opposition to the Suharto regime during the 1990s was the formation of the Peoples Democratic Party (PRD). Although a small party, it has won respect for its consistent struggle for democratisation of Indonesian society.

The PRD considered standing a candidate for the position of governor of Jakarta against the military commander of Jakarta during the Suharto period, Sutiyiso. They selected woman student leader Zelly Ariane, who had led some of the mass actions against Suharto's Golkar party during the presidency of Abdurrahman Wahid (Gus Dur). But she could not proceed with her registration as a candidate because she is 22.

The discrimination against age goes beyond the electoral laws. During Suharto's rule, the rebelliousness and energy of youth -- semangat -- was suppressed. Within the repressive, corruption- driven, highly bureaucratised New Order political culture, active young people were patronisingly referred to as anak-anak (children). During the struggle for independence, young people struggling for change were never referred to as anak-anak. They were known as pemuda, a term that literally meant "youth" but referred to those at the forefront of the struggle for change. The Indonesian national revolution is often referred to as the revolusi pemuda.

When the student leaders and organisers of the 1990s, who led the struggle to overthrow Suharto, gained popularity, the over-40 elite politik that monopolises politics sometimes referred to them as anak-anak baik yang idealis (good, idealistic children).

Even within pro-democracy circles and non-government organisations, this prejudice can exist. I have heard NGO activists denigrate the PRD, for example, because it is a "student party" with nobody "of any age" in its leadership. Generally, there is a deference to the older political elite even as this elite as being criticised as politically and intellectually bankrupt.

At this time in Indonesian history, if any discrimination is necessary, it should be against those who are over 40. The campaign for democratic and social reform, for reformasi total, is almost entirely led by young people. Reformasi is a project of those sections of Indonesian society who are free of the New Order political culture, and this means, more or less, people under 40.

How can total reform take place if those who are the movement's prime source of energy and ideas are excluded from the top leadership positions of the government and are not the dominant force in parliament? How can there possibly be total reform unless at least 70% of the members of parliament are under 40? Society should be on the look-out for "student parties" or young parties, rather than looking down upon them.

In the end, the discrimination against Indonesia's young people is a measure to protect the political dominance of the New Order generation. Of course, there are people over 40 who fought against Suharto. And there are people under 40 who still have a New Order mentality. But the reality is that reformasi is an idea that springs from the youth, is being fought for by the youth and it was youth that paid the supreme sacrifice, such as on May 12, 1998, when security personnel shot into student protesters from the Trisakti University, killing four students and injuring several.

[This is an abridged version of an article published in the July 2 Jakarta Post. Max Lane is a visiting fellow at the Centre for Asia Pacific Social Transformation Studies, University of Wollongong. Lane is also national chairperson of Action in Solidarity with Asia and the Pacific.]

Aceh/West Papua

Indonesian army kills four Aceh rebels

Agence France Presse - July 20, 2002

The Indonesian military says it has killed four separatist rebels in troubled Aceh province.

Soldiers gunned down two Free Aceh Movement (GAM) rebels during a gunfight at Peusangan in Bireun district on Saturday, said provincial military spokesman Major Zaenal Muttaqin. Two other guerillas managed to escape.

Muttaqin said troops killed another separatist in a 30-minute gunfight at Kuala Daya in West Aceh district on Friday.

In another incident on Friday, a rebel was killed in an encounter with the military at Pucok Lutung in Pidie district on Friday, the spokesman said.

A GAM spokesman, Abu Arafah, said an unspecified number of government troops were killed in a skirmish in the mountainous Gunung Gurutee area in West Aceh on Thursday night. The military denied the claim.

More than 600 people -- most of them civilians -- have been killed this year in clashes involving security forces and the separatists, who have fought for an independent Aceh since 1976. The central government is formulating a new policy towards the revolt and has floated the idea of imposing a state of civil or military emergency.

Police called on to release Achenese woman activist

Detikcom - July 21, 2002

Arifin Asydhad, Jakarta -- The Chairperson of the Achenese Women's Democratic Organisation (ORPAD), Reihan Diany, has been detained by the Aceh Besar district police since Sunday. The detention of the Achenese woman activist is considered to be an irrational act. Police are therefore being called on to release her.

Reihan was arrested along with six other ORPAD activist by police on Tuesday. They were arrested while holding a demonstration around the theme of "Overthrow the Mega-Hamza [President Megawati Sukarno Putri-Vice-President Hamza Haz] government and replace it with a government of the poor people.

The arrested activists were Diany, Nova Rahayu, Azizah, Gustriana, Ira Wellya, Yusmanidar, and Nuraida. The majority of them are students.

In a press release received by Detikcom, the Nusantara Civil Society Alliance called for the seven activist to be released. The alliance is made up of a number of non-government organisations including the Information Center for an Aceh Referendum (SIRA), the People's Solidarity Movement for Aceh (Segara), Achenese Peoples Democratic Resistance Front (FPDRA) and the People's Forum (FR).

The alliance said that the arrest of the seven ORPAD activists was an irrational act which showed the anxiety of the authorities. They therefore called for Reihan to be released. "Release Reihan immediately from the unclean political detentions of Megawati", read the alliance' demand.

The demand for Reihan's release was also made because there was information that Reihan is suffering a stomach ulcer and has low blood pressure. Therefore if Reihan continues to be detained her health could futher deteriorate.

[Translated by James Balowski.]

Emergency status would starve Aceh refugees

Jakarta Post - July 20, 2002

Edith Hartanto and Yogita Tahilramani, Banda Aceh -- Thousands of refugees in Aceh will completely lose access to aid and food supplies due to blocked lines of transportation if, as expected, a civilian emergency is imposed in this restive province.

The refugees, including women and babies, are currently living in abhorrent conditions and facing water shortages in camps across the strife-torn area.

"Today, it is extremely difficult to channel aid to these refugees because of the tight security cordon in and around the refugee camps. They forbid people to enter the camps with goods in hand or in packages. We can still manage to send refugees aid by traveling by sea or by taking shortcuts via the surrounding forests," said Hermanto, a spokesman for the People's Crisis Center of Aceh (PCC-Aceh).

PCC-Aceh is a non-governmental organization which monitors and updates records on the number and conditions of refugees across 17 primary camps in the country's westernmost province.

"But I cannot imagine, how can we send them aid during a civilian emergency when deployment of security forces in and around these camps will be sharply increased, as well as in the forests? Transportation lines will most likely be totally blocked, due to increased security and curfews." The central government is due to decide on Aceh's fate on August 5.

"The government could call it a civilian emergency once it is imposed, but the Acehnese will always see it as a military emergency, due to the military domination in Aceh," Hermanto said.

During a decade-long military operation (DOM), in a desperate attempt to rid the province of separatist rebels in Aceh, which ended in 1998, 1,025 were killed according to government data, however rights groups put figure perhaps 10 times higher.

Refugees in Aceh, including transmigrant Javanese, fled their homes due to continuous clashes between separatist rebels and security forces, which have resulted in the deaths of at least 600 people this year alone.

Aside from the fact that most of their homes have been burned down, refugees in these camps suffer from malnutrition, and diseases ranging from diarrhea, breathing problems and severe skin diseases, Hermanto said.

Hermanto said that to date, PCC-Aceh workers had to travel by sea and walk through remote forest trails carrying food and medical supplies on motorcycles, for the refugees in camps in East Aceh, North Aceh, Central Aceh, West Aceh and Pidie.

"Officials refuse our entry to the camps over any suspicions that we are supporting rebel-affiliated refugees [ethnic Acehnese]. Refugees are perceived as friends or even shields for the Free Aceh Movement [GAM] separatist rebels, who allegedly use refugee camps as a platform to gain support from either the Acehnese public or media, both local and international," Hermanto claimed.

In 1999, when the number of refugees had skyrocketed due to the rising tensions, leaders of GAM had reportedly used these camps as a base to conduct interviews with both the international and local media, or even to make contact with certain refugees.

Around two years ago, Hermanto recalled, refugees living in the Idi Rayeuk district of East Aceh had to abandon the area due to a GAM occupation for over 14 hours. The refugees ended up living, sleeping and eating in boats, floating in the middle of the Simpang Ulim river.

Another PCC-Aceh activist, Misdawan R.H., said security forces guarding the camps, mainly in East Aceh and North Aceh, and the Aceh provincial administration had refused to distribute or give aid to the refugees, unless they agreed to return to their homes. The refugees do not comply with the request because aside from their fragile health condition, their homes had been burned down, Misdawan added.

PCC-Aceh has noted that refugees hit hard by a water shortage and inadequate sanitary facilities are located in the Lhok Nibong camp in the Pante Bidari district, Geulumpang Payong camp in Sungai Raya district, Kuala Malihan camp in the Simpang Ulim district, the Kuala Idi camp in the Idi Rayeuk district, Gajah Meunta camp and Alue Rangan camp in Sungai Raya district, all in East Aceh.

Acehnese express disbelief over state of emergency plan

Jakarta Post - July 20, 2002

Banda Aceh/Jakarta -- Acehnese expressed disbelief on Friday over the government's insistence on imposing a state of emergency in the restive province, stressing that all social layers in Aceh had expressed their rejection to any state of emergency.

Aceh administration spokesman Husni Bahri told The Jakarta Post on Friday that Acehnese people were still dealing with the traumas of the 1989-1998 military operations, and any state of emergency now would reopen the wounds.

"It is completely wrong to think that opposition [to a state of emergency] does not reflect the aspiration of Acehnese people," said Husni, referring to Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono's statement on Thursday that the Aceh councillors and Governor Abdullah Puteh did not represent the Acehnese people as a whole.

Chairman of the Aceh Ulemas Council Tengku Imam Suja' voiced a similar opinion on Friday. "Imposing a state of emergency in Aceh is against the wishes of the Acehnese people," said Imam Suja', who is also chairman of Muhammadiyah Aceh branch.

Susilo, who just returned from a five-day visit to Aceh to assess whether or not the situation there warrants a state of emergency, said Thursday that the government would pursue its plan to impose a state of emergency in Aceh.

He also claimed that the near-unanimous rejection by the Acehnese legislative representatives and Governor Puteh did not represent the Acehnese people who had been urging the government to deal firmly with the Free Aceh Movement (GAM).

Imam Suja' said Minister Susilo had heard it for himself that Acehnese ulemas, the local administration and other social elements flatly rejected a stronger military approach in Aceh. "What Acehnese people want is a dialog between the government and GAM to be pursued," Imam Suja' told the Post.

Aceh councillor Muhammad Nasir Djamil warned Susilo on Friday against ignoring the aspirations of Acehnese people which was clearly conveyed to him last week.

"Jakarta should not disregard those voices as it was conveyed directly to the minister," Muhammad said. "Should Jakarta insist on imposing a state of emergency in Aceh, it will only deepen the scars in the hearts of Acehnese people," he said.

Despite the peace calls, Iskandar Muda (Aceh) Military Commander Maj. Gen. Djali Yusuf said in Jakarta on Friday that the Indonesian Military (TNI) would intensify its military operations in the province.

"With or without a decision on a state of emergency in Aceh, we, the TNI, will continue with our military approach there. I guess it's the only way to protect civilians because the rebels threaten security," Djali told reporters after holding a meeting with Army Chief of Staff Gen. Ryamizard Ryacudu at Army Headquarters.

According to Djali, the meeting also discussed the deployment of an additional four battalions to the province. He said reinforcements were needed in Aceh to overcome the forces of GAM, which had been fighting for independence since the 1970s.

He predicted that GAM currently had 3,962 combat troops on the ground, with 1,800 various weapons. The government, on the other hand, has a reported total of some 21,000 TNI troops and 12,000 police personnel.

"If GAM launched a conventional war, I believe that we could crush them in one day," Djali said. As the rebels conducted guerrilla warfare, TNI needed more troops to track down and attack them, he said.

He said the additional 4,000 troops would mostly be deployed in West Aceh regency, despite the hotbed of rebellion being in East Aceh regency. Djali did not provide further explanation.

TNI chief Gen. Endriartono Sutarto added that the Aceh question needed an effective solution. "Dialog is good, but if GAM continues to demand independence, dialog is impossible ... we have to settle the Aceh issue once and for all," Sutarto said after meeting President Megawati Soekarnoputri at the State Palace Friday. The four-star general also proposed an amnesty for GAM members who wanted to return to the Indonesian side.

"Once they [GAM] agree to accept the special regional autonomy, then the government would arrange an amnesty for them," he added. However, he said the president had yet to decide a new policy on Aceh and TNI would only follow the instruction from the government.

Jakarta troops to tighten screws on Aceh rebels

Melbourne Age - July 20, 2002

Jacqueline Koch -- Jakarta has again raised the stakes for the resource-rich and restive province of Aceh, on the northern tip of Sumatra, where Indonesia faces an entrenched independence movement.

After branding rebels of the Free Aceh Movement as terrorists, Indonesia's Coordinating Minister for Security and Political Affairs, Susilo Bambang Yudhoyono, has called for intensified military operations in Aceh.

After a week-long tour of the province, Mr Yudhoyono this week asked President Megawati Sukarnoputri to authorise sending a further 8000 troops there.

The strategy shift comes as Jakarta boasts of armed forces reforms in an attempt to restore military ties with the United States, cut in response to army atrocities in East Timor.

The move to hard-line tactics reverses the military's previous campaign of winning hearts and minds. This tack was used to promote claims of reform in the province, where the military's human rights record is notoriously poor. One commander in Jakarta described the earlier campaign as a "persuasive, not repressive, approach to defeating separatism".

In past months, the military has moved from populated areas into mountain villages where Free Aceh fighters, known as GAM, are suspected to be hiding. This has enabled the military to secure major cities and transport routes. As a result, the conflict has shifted away from public scrutiny.

Despite the hearts and minds campaign, human rights workers say bodies -- mutilated, tortured and bullet-riddled -- are found every day. The military says those killed are rebels, but many Acehenese say the victims are overwhelmingly unarmed villagers.

Evidence from victims and field reports indicates Aceh's civilians are increasingly terrorised and brutalised by the police mobile brigade, a paramilitary unit known as Brimob.

"If you have to pick which to avoid, between TNI [the army] or Brimob, you would avoid Brimob," said one Banda Aceh resident. Though TNI is under pressure to improve its image, Brimob, which works closely with the army, is not.

Last March, Munawar (not his real name), a 27-year-old hotel clerk, fell victim to Brimob intelligence operations. "They brought me in, stripped me and beat me, they kept accusing me of being GAM," he said.

Brimob officers then gave him coffee to perk him up for the next round of interrogation. "While I answered their questions, I saw them plug in an iron," he said. He was then blindfolded and officers interrogated him while holding a scorching iron to his hands and neck.

Then, with a gun stuck in his mouth, he was ordered to become a Brimob informer. "They told me, 'your destiny is in your mouth'," Munawar said. Eventually released, he was ordered to report to police daily and was again physically abused for refusing to be a spy.

Two days later, Munawar fled into hiding. "I don't want to ruin other peoples lives. I'd rather just die. But if I didn't run, I would already be dead." At a coffee shop in Aceh Besar, a man named Yushal detailed Brimob tactics in the field. "When the Brimob arrives, everyone is trauma-tised," he said.

According to Yushal, Brimob conducts sweeping operations in his village at night. Villagers are called out of their homes. Some are beaten, others are randomly selected for detention. Detainees are often tortured. Officers demand payment for their release.

"In a village nearby, the chief was taken away with his three- year-old son for a week," Yushal said. "When he came back, he couldn't move he was beaten so badly." Yushal says civilians fear Brimob more than TNI. Human rights workers say Brimob still uses Suharto-era enforcement methods -- torture, terror, abductions and executions.

Brimob's reputation hasn't eluded the international community. In US legislation last month, Brimob was specifically excluded for police training funds as a result of its poor human rights record.

According to official numbers, TNI has about 20,000 soldiers in Aceh, backed up by 8000 Brimob. Human rights activists insist the number is much higher. GAM rebels are estimated to number up to 3000.

Indonesian troops kill 12 suspected rebels in Aceh

Agence France Presse - July 18, 2002

The Indonesian military said it has killed 12 separatist rebels in troubled Aceh province.

Soldiers killed eight Free Aceh Movement (GAM) members in a 30- minute encounter at Alam Jeumpa in West Aceh district on Wednesday, said provincial military spokesman Major Zaenal Muttaqin.

Also Wednesday, three guerrillas were killed and three arrested in a military ambush at Mereu in Aceh Besar district, he said. GAM said the 11 were civilians.

The military spokesman said troops killed another suspected rebel at Kampung Blang in North Aceh on Wednesday. A handgun and two home-made bombs were seized.

A rebel spokesman, Teungku Jamaica, said soldiers shot dead a civilian at Simpang Keuramat in North Aceh on Wednesday. The military denied the claim.

Jamaica also said two men were found dead on Wednesday in separate places in North Aceh. They had been arrested a few months ago by soldiers guarding the gas plant of US-based oil giant ExxonMobil, he said.

Police and troops have stepped up offensives against rebels following a recent series of kidnappings, arson attacks and murders which they blame on the separatist movement.

Aceh police said Thursday that at least 50 people had been taken hostage by the rebels over the past four months. Adjunct Senior Commissioner Dadek Achmad said more than 20 of them had yet to be released.

He said the remainder had been freed for ransom amounting to "hundreds or at least tens of million rupiah [thousands or hundreds of dollars]. Otherwise they will execute them [the hostages] mercilessly," Achmad said.

Earlier this month GAM released nine crewmen seized from an oil company supply ship and nine athletes and sports officials. GAM said they were freed after they were found to be civilians and not engaged in military operations.

Top security minister Susilo Bambang Yudhoyono on July 4 said the government wanted to declare a state of civil emergency against what he called "terrorists." But various parties in the province advised him against such a move during his subsequent visit to the energy-rich region on Sumatra island. An estimated 10,000 people have been killed since the revolt for independence began in 1976, more than 600 of them this year.

The military commander in Aceh has asked for 2,000 extra troops. Jakarta said the demand is still being studied pending a review of its overall policy on the province.

Aceh emergency status would get support: minister

Reuters - July 18, 2002

Jakarta -- Most Indonesians and parliament would back the government if it imposed civil emergency status on the rebellious Aceh region, Indonesia's top security minister said on Thursday.

Civil emergency is one step down from martial law and would give wide security powers to authorities such as imposing curfews and searching houses at random in Aceh where thousands have died as a result of fighting between government troops and separatist rebels.

Jakarta expects to announce new Aceh policies in early August after expressing mounting frustration over recent bloodshed, which prompted chief security minister Susilo Bambang Yudhoyono to fly to the region for a week's inspection earlier this month.

"The house commission has urged the government to conduct firm steps ... implicitly and explicitly giving the support when the government reaches [the decision] to impose a civil emergency status," Yudhoyono told a news conference in Jakarta.

"That means the government steps have obtained the support of the parliament and the majority of Indonesian people. So, we now have a strong legitimacy," he said.

Yudhoyono also said Jakarta wanted rebels from the Free Aceh Movement (GAM) to fulfil some conditions before peace talks between the two parties, begun in 2000, could resume.

"Dialogue can be conducted with prerequisites that first the commitment from the armed separatists to accept the special autonomy must be obeyed," he said. "Secondly, [their] attacks on civilian targets must stop. We will convey this to [the talks facilitator] at once."

The series of peace talks between Jakarta and GAM held in Switzerland has failed to stop the cycle of violence in the area on the northernmost tip of Sumatra island, some 1,700 km northwest of Jakarta. Earlier this month, Yudhoyono branded GAM as "terrorists" for alleged involvement in the murders of members of the provincial parliament, civilian abductions and school burnings.

But when he visited resource-rich Aceh last week, most Acehnese rejected the idea of emergency status in an area where military efforts have failed to eliminate the 25-year-old separatist movement.

Underscoring the tense conditions in Aceh, Indonesian security forces and GAM rebels on Thursday claimed battle successes against each other the day before. GAM said its forces killed at least nine soldiers, while a military spokesman told Reuters no one on the government side was killed but troops had shot dead at least 11 rebels.

Clashes between the two warring sides occur daily in remote areas in Aceh's forest, frequently leaving civilian casualties. The International Crisis Group think-tank says some 2,000 people were killed in 2001 alone, most of them civilians.

Government to go ahead with state of emergency in Aceh

Jakarta Post - July 19, 2002

Tiarma Siboro, Jakarta -- The government is still pursuing its plan to impose a state of emergency in the restive province of Aceh, ignoring strong opposition from the provincial administration, councillors and students as well as non- governmental organizations there.

Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono said on Thursday that the rejection by Aceh legislators and Governor Abdullah Puteh of the plan to impose a state of emergency did not reflect the wishes of the Acehnese people as a whole.

"Their stance is against the demands of most Acehnese people who have urged us to restore security in the region," Susilo told a press conference held after a special coordinating meeting on political and security affairs on Thursday.

Minister for Foreign Affairs Hassan Wirayuda meanwhile said that dialog remained the best way to deal with the Aceh question. "I am for dialog and I do believe that a conflict cannot be resolved by creating a new conflict," he said during a discussion on human rights issues in Jakarta on Thursday.

President Megawati Soekarnoputri sent Susilo to Aceh last week to evaluate whether or not conditions there warranted the imposition of either a civil emergency or martial law.

During his five-day visit, he held meetings with local military and police commanders, councillors, religious leaders, students and non-governmental organizations.

In a meeting with local councillors, Susilo was warned against imposing either a civil emergency or martial law in the province as they claimed it would only worsen security conditions there, where thousands of innocent people have been killed in crossfire between government troops and GAM fighters. Religious leaders, student activists and non-governmental organizations also expressed similar objections.

But according to Susilo, these councillors, religious leaders, students and non-governmental organizations do not represent the aspiration of the Acehnese people. "It is not true that the Acehnese people reject the government's tough actions [against the Free Aceh Movement]. They told me they are tired of GAM, and urged the government to bring peace to their area. They are afraid of GAM, but at the same time have appealed to the TNI and the police not to hit wrong targets in their operations," Susilo said.

"I received a written recommendation from Acehnese legislators that security and economic approaches should go hand in hand," he stressed.

"Yesterday [Wednesday], the House of Representatives supported us in our plan to take stern measures against GAM, including imposing a state of emergency in the province to keep our country united," he said.

He added that the government would unveil its new policy on Aceh on August 5. "The armed separatist movement must be defeated," he said.

Susilo also said that the government planned to send 24 judges to Aceh in the near future to preside over trials for anyone -- be they military personnel, GAM members, or civilians -- who violates the law and commit human rights abuses. "Any separatist movement is against the law. So we should prosecute them in a fair trial," Susilo said.

According to Susilo, GAM currently has 3,000 combat troops on the ground with 2,000 weapons, plus 5,000 clandestine supporters. The government, on the other hand, has a total of 21,000 troops and 12,000 police personnel.

"In a conventional war, we would only need three soldiers for every GAM member, but since we [the government] are facing an insurgency movement, we may need nine soldiers for every GAM member," Susilo said. Susilo has requested an additional 8,000 troops for Aceh, compared to the 4,000 personnel requested earlier by the Banda Aceh-based Iskandar Muda Military Commander Maj. Gen. Djali Yusuf.

The government, he said, would ask for a written acknowledgment of support from the House of Representatives (DPR) Commission I. "I will ask for a written acknowledgment [of support] from the House," said Susilo, adding: "This will mean that the legitimacy of the government's actions will be stronger." Susilo also said that GAM must accept the special autonomy arrangement and stop violence against local people if it wants peace talks with the government to resume.

He said the government would make a new dialog format to accommodate suggestions from Muslim ulema and intellectuals in Aceh who were also involved in negotiations.

Aceh women arrested for insulting president

Laksamana.Net - July 17, 2002

Seven young women belonging to a pro-democracy group in rebellious Aceh province have been arrested for insulting President Megawati Sukarnoputri and Vice President Hamzah Haz.

State news agency Antara said the members of the Women's Organization for a Democratic Aceh (Orpad) were detained by police Tuesday in Banda Aceh city for displaying defaced pictures of Megawati and Haz during a street protest.

The women, aged between 16 and 22, had drawn red crosses through the faces of the president and vice president to symbolize their rejection of the nation's leaders.

Indonesia claims to be a democracy, but the law forbids citizens from publicly expressing disrespect toward the president and government.

Under Article 154 of the Criminal Code, "the public expression of feelings of hostility, hatred or contempt toward the government" is punishable by up to seven years in jail.

Article 134 punishes "insulting the president" with a maximum sentence of six years in jail, while Article 137 allows for a jail sentence of up to one year and four months for anyone who "disseminates, demonstrates openly or puts up a writing or portrait containing an insult against the president or vice president".

Banda Aceh Police chief Commissioner Alfons Toluhula said the seven women had also violated the law for failing to notify police before conducting their protest.

The women, who are university students and former students, were identified as Raihan (21), Ida (16), Nonong (22), Nova Rahayu (21), Igustriana (22), Yusirwilya (18) and Yusmanidar (21).

Warning Megawati earlier this month expressed her disapproval of demonstrators who deface or trample on pictures of the president and vice president.

The leader of a prominent Muslim organization's youth wing, Al Amin Nurwahab, who met with Megawati on July 8, said the president was "saddened" by demonstrators who vandalize state symbols.

Nurwahab, who chairs the Nahdlatul Ulama Youth Organization (IPNU), quoted Megawati as saying the president and vice president are state symbols who deserve respect.

Wait a minute. Was Megawati saying that former dictator Suharto deserved respect, even though he gave orders that resulted in about one million killings? Does she mean Suharto should be respected for allowing corruption to flourish and leaving the nation in economic ruins?

Does Megawati herself desrve respect for giving the military carte blanche to commit human rights abuses, such as raping and murdering civilians in Aceh?

And is she worthy of respect for posing as a democrat while refusing to allow repressed provinces to have independence referendums?

"If the state symbols are not respected, they [demonstrators] do not respect their own country," Nurwahab quoted Megawati as saying. Megawati reportedly said that if protesters do not like Indonesia they can leave the country.

Analysts say most people in Aceh would love to secede from Indonesia, but the president will not allow the resource-rich province to hold a referendum on independence.

Nurwahab said Megawati expressed hope that any future demonstrations would be conducted "politely".

Manpower Minister Jacob Nuwa Wea in late June warned he would "hunt down" any demonstrators who dare to deface, kick or burn pictures of Megawati and Haz.

Student demonstrators have staged several rallies in Jakarta waving posters that show the president and vice president with large red Xs drawn over their faces. Pictures of Megawati with tusks, fangs or horns have been sported at some demonstrations.

Many Indonesians view Megawati as a traitor to democracy because she has failed to curb corruption or arrest military officials involved in human rights abuses. Instead, she has told the military not worry about committing human rights abuses.

The president has also rejected calls for an inquiry into allegations that Golkar Party leader/parliament speaker Akbar Tanjung embezzled Rp40 billion in state funds that were supposed to have been used to buy food for the needy.

Megawati's most controversial move of late was to support Jakarta Governor Sutiyoso's re-election bid, despite his alleged roles in corruption and human rights abuses.

The president's lack of democratic statements and actions are attributed to her falling out with her longtime friend and former speechwriter Eros Djarot, who was reportedly pushed out of the loop by Megawati's affluent businessman husband Taufik Kiemas.

Aceh's bloody war without end

BBC News - July 17, 2002

Rachel Clarke -- Indonesia's leaders are trying to work out what to do next with strife-torn Aceh.

More troops could be sent to the northern province, a civil emergency could be declared to give the authorities more powers or full military law could be imposed.

Acehnese separatists know what they want -- independence. That is the least likely outcome in the immediate future. The most likely is more conflict and more deaths.

The province of Aceh is at the far north-west of the sprawling Indonesian archipelago. Its capital, Banda Aceh, is 1,850 kilometres from the federal capital of Jakarta. But its violent separatist movement, plus its rich natural reserves put it centre stage of Indonesian Government policy.

Security Minister Susilo Bambang Yudhoyono recently spent a week in the province speaking to military and civilian leaders. He was trying to identify ways to end the bloodshed that has accompanied a 26-year campaign for independence by the Free Aceh Movement or Gerakan Aceh Merdeka (GAM).

'Emergency' laws

That campaign has been renewed recently after a period of retrenchment following the January killing by Indonesian security forces of GAM's military commander Abdullah Syafei.

Mr Susilo appears to have backed down from a threat to impose a form of martial law. But he backed calls from Djali Yusuf, Aceh's military chief, for troop numbers to be boosted. There are at least 28,000 members of Indonesia's security forces in Aceh, and Mr Yusuf suggested 8,000 more troops be sent.

General Endriartono Sutarto, the commander of the Indonesian Defence Force, said last week that troops would be a part of any solution.

"Problems in the province could not be settled only by the military and police or by the co-ordinating ministers," he was quoted as saying by the state news agency Antara.

Lesley McCulloch, lecturer at the University of Tasmania, believes that the military has wanted to enforce control over Aceh for some time. With President Megawati perceived as weak, the army was now able to flex its muscles. "The military has always wanted to crack down, but hasn't been allowed to," she said.

Defiance

Whatever Jakarta decides, it will find the separatists determined to fight on.

The information officer for GAM, Bakhtiar Abdullah, told BBC News Online that in the long term, the Indonesian military would not win. "We have a huge amount of support, majority support from the people," he said.

Sending more troops to Aceh or imposing any form of crackdown or martial law would "backfire", he said. "The Acehnese are getting stronger and stronger and the morale in Aceh is even higher."

Amid the fighting, the two sides are also trying to win the propaganda war, accusing each other of the attacks that add, on average, 10 people a day to the death toll of more than 10,000. GAM's Mr Abdullah said: "We kill, but we kill only soldiers. In the field, it's the gun that speaks louder than anything else." The military reject the allegations that they kill any civilians deliberately, saying the acts are those of GAM, trying to smear government forces.

A European Commission report on avoiding conflict in Indonesia said the motives of the Indonesian authorities could be questioned.

"The murders of GAM leaders and the establishment of a new regional military command in Aceh only increases suspicion that the government is not committed to a peaceful resolution of the conflict in Aceh," it said. The Human Rights Watch organisation blames both sides for abuses.

Peace talks

Peace talks have been launched under the auspices of the independent Henry Dunant Centre in Geneva. They have not broken down, but nor have they made much headway, correspondents say.

A limited form of autonomy was introduced in Aceh on 1 January. The province was promised a greater share of oil and gas revenues and elections for governor. But the separatists want much more, especially now another formerly troubled Indonesian province -- East Timor -- has won its independence.

In fact there are crucial differences between the two cases, which explains why foreign nations are not lining up to support the Aceh separatists: Aceh has no former Western colonial power like Portugal taking an interest East Timor was annexed forcibly Aceh's oil and gas reserves are important to Indonesia's economy and global trade Aceh is strategically important, lying at the northern end of the Strait of Molucca, an important shipping lane US interests That does not mean Indonesia can ignore foreign opinion.

The United States has sought better ties with Indonesia and US Secretary of State Colin Powell is due in Jakarta in August. But a senior US official in Jakarta has warned that the deteriorating situation in Aceh could stall any improvement of ties.

With the Indonesian army and the separatists equally determined, many analysts fear that continuing violence is the most likely outcome. "Unless something big happens and someone is there with a camera, this can continue for some time," Lesley McCulloch said. "In the meantime, hundreds or thousands of Acehnese will be killed."

Boatload of AK-47s and ammo for Aceh seized by Thai police

Straits Times - July 16, 2002

Bangkok -- The Aceh separatists' regional connection was bared after police in Thailand seized a major arms cache, including 68 AK-47 rifles, bound for the rebels in Indonesia's troubled northern province.

Police in the southern Thai province of Satun said yesterday that they had also arrested two suspects in the latest of a series of interceptions of arms shipments destined for rebel armies in Asia.

"We arrested them during a shipment at La-ngu district last night at 9 pm while the arms were being transported by a small boat to open waters in the Andaman Sea," said La-ngu police chief Rattakarn Karnchanachot.

The confiscated weapons included 68 AK-47 rifles, five handguns and ammunition. The suspects confessed they were paid 10,000 baht to transport the arms.

Satun police commander Sathien Chansawang said the arms were destined for rebels in Aceh, where the Free Aceh Movement (GAM) has been fighting since 1976 for a separate state.

"The arms were bought from Cambodia and they were collected for transport by sea to rebels in Aceh province," he said.

"The suspects confessed that they have transported twice before some 40 guns for the rebels in Aceh." National police chief Sant Sarutanond said he had sent his deputy Kowit Wattana to Satun to supervise the interrogation of the suspects.

Prime Minister Thaksin Shinawatra promised to launch a crackdown on illegal arms smugglers. "We are checking on this matter across the country, and there will be a crackdown before an amnesty is issued to war weapon holders," he told reporters.

Earlier this month, the authorities in the southern province of Phuket seized six rocket-propelled grenades, two M-67 hand grenades and 596 AK-47 bullets and arrested one Thai suspect. Sources close to the Thai military said the Tamil Tigers operated a sizeable base on a Thai island 15 km off Phuket last year.

Meanwhile, Indonesian Vice-President Hamzah Haz said the government had ruled out any imposition of martial law in Aceh.

Government asks for additional reinforcements in Aceh

Jakarta Post - July 16, 2002

Fabiola Desy Unidjaja and Tiarma Siboro, Jakarta -- Despite public opposition to a state of emergency in Aceh, Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono has asked the President to deploy 8,000 more troops to the restive province.

Denying this would constitute the imposition of martial law by stealth in the province, Vice President Hamzah Haz said the government was considering granting the request.

"There is a request which was conveyed during the Cabinet meeting [today]. We will discuss this further and decide something next week," Hamzah said when asked whether the government would comply with Susilo's request.

He said that Susilo, fresh from a one-week visit to Aceh, reported on the situation in the province to President Megawati Soekarnoputri and mentioned the proposal to deploy more troops. "There will be no martial law ... but we will discuss the deployment," the Vice President remarked.

After the Cabinet meeting, Susilo when asked about the deployment refused to give any details saying, "It will be announced next week. Everything will be taken into consideration." The request for reinforcement troops for Aceh immediately drew criticism from observers, who said that it had more to do with the military's businesses than with the interests of the state.

"The presence of this huge military force in the region is merely part of a military project to control the province's rich natural resources rather than to restore peace and security there," Ikrar Nusa Bakti of the National Institute of Sciences (LIPI) said.

Meanwhile, rights activist Johnson Pandjaitan of the Indonesian Legal Aid and Human Rights Association (PBHI) said that the military was attempting to describe how crucial the operation was so as to force the state to support its financial demands, as well as for political purposes.

He said the government looked unwilling to back down from its intention of stepping up the military approach against the Free Aceh Movement (GAM), which began waging a rebellion in the mid- 1970s.

Since 2001, the government has issued three presidential decrees approving the military approach in Aceh, with more than 21,000 reinforcement troops posted in the province to back up thousands of police attempting to crush some 3,000 GAM combatants.

The government, along with legislators, reinstated the Iskandar Muda Military Command in February, saying that it was required to shorten the chain of command in the region, which previously came under the Medan-based Bukit Barisan Military Command.

A senior military officer has revealed that of 230,000 soldiers in the army, only between 70,000 and 100,000 of them were combat capable. If Susilo's bid is approved, almost one third of the army's combat-ready strength will have been deployed to Aceh.

This massive deployment in Aceh, home to some four million people, shows inconsistency at TNI headquarters, which has repeatedly claimed that the number of TNI troops is far from enough to protect the country's population of about 210 million.

Ikrar further questioned TNI professionalism, saying "a professional military should only need three soldiers for every GAM member, but instead the TNI has sent more than seven soldiers for each member of GAM. When the military claim they cannot estimate the exact number of GAM members because they are conducting a guerrilla war, they should send intelligence operatives instead of a huge deployment of combatants," Ikrar told The Jakarta Post.

A military source told the Post that the military spent billions of rupiah in funding its operations in the country's troubled regions, including Aceh, Maluku, Poso in Central Sulawesi, and Papua, because "these operations are classified as unprogrammed operations that are not funded by the State Budget." According to the source, each TNI soldier received a Rp 17,500 (US$1.80) meals allowance. Should he be assigned to join such an operation, he would receive double this allowance.

"The meals allowance for the troops on military operations in Aceh alone cost some Rp 270 billion last year. That, of course, does not include the cost of purchasing ammunition and military equipment," the source said.

Asked how the TNI could fund its operations, the source said: "We recognize a system known as the 'on-top budget'. Its a bit like money from heaven. It's an unlimited budget. During the New Order regime, this budget could be obtained from various sources, including the presidential aid fund. So, we can manage to cover our costs and fund our operations as well," the source said.

Shooting Aceh's messenger, killing peace hopes

Jakarta Post - July 15, 2002

Lesley McCulloch -- The pursuit of a negotiated settlement to the conflict in Aceh has been viewed with skepticism by many for some time. But now confirmation of the Indonesian government's lack of commitment to the peace process seems imminent.

Coordinating Minister for Political and Security Affairs, Susilo Bambang Yudhoyono, is visiting Aceh to discuss with local military and political leaders the prospects for imposing a state of emergency in the violence-racked province.

Such a step would be a definitive rejection of the possibility for a negotiated settlement to the conflict any time in the near future.

And indeed, five negotiators who represented the pro-independence Aceh Sumatra National Liberation Front (ASNLF, commonly known as GAM) at peace talks in Geneva in May have already been threatened with arrest. They are Sofyan Ibrahim Tiba, Tgk. Muhammad Usman, T. Kamaruzzaman, Amni bin Marzuki, and Amdi bin Hamdani.

They have been ordered to leave the Kuala Tripa Hotel in the provincial capital of Banda Aceh, in which they have been living since June 2000, or be taken into custody.

The negotiators initially took up residence in the hotel to facilitate regular contact with the office of the Geneva-based Centre for Humanitarian Dialogue (HDC), facilitators of the fruitless peace talks. But after the killing by the military of a sixth member of the delegation, Zulfani bin Abdul Rani in October 2001, residence in the hotel turned from a choice into a necessity.

The government has not been willing to attack the remaining five negotiators under the eyes of the hotel's international guests and HDC staff. But the group now fear, not unreasonably, that if they comply with the order to return to their villages, they too will eventually be killed. As Amni bin Marzuki said in an interview on Thursday, "We are on stand-by here for anything to happen. But we are refusing to move."

The fate of these men is of particular interest and import, since it serves as a litmus test of the Indonesian government's commitment -- or lack thereof -- to a negotiated settlement of the crisis in Aceh. Negotiators are embodiments of a process of peaceful dialog. Without negotiators, how can dialog continue? Diplomatic immunity is one of the most ancient principles of what we now codify as international law. Successful negotiations depend on the safety of the negotiators involved, not just during meetings but for as long as they are within the reach of their partners in dialog.

Were Aceh recognized under international law as a state -- even one at war with Indonesia -- the negotiators' immunity as diplomats would be guaranteed. As it is, their safety is no more assured than that of any of the 600 Acehnese who have died at the hands of government troops in the last six months alone.

ASNLF Central Bureau for Information spokesperson Teungku Isnander argues that the Indonesian government should behave according to internationally agreed best practice, that is, the pursuit of peaceful solution to a conflict. This includes giving a degree of protection to those involved in brokering peace.

An important model for such protection can be found in the Philippines. There, the government took the signal step in February 1995 of signing with the opposition National Democratic Front a joint agreement on safety and immunity guarantees.

The agreement extends protection to negotiators, consultants, staffers, and other personnel participating in peace negotiations. Under the Joint Agreement, all duly accredited persons are guaranteed free and unhindered passage in all areas of the country.

They further are guaranteed immunity from surveillance, harassment, search, arrest, detention, prosecution and interrogation, or any other similar punitive actions due to involvement in the peace negotiations.

The agreement has been a cornerstone of the Philippine peace process. It serves as an example that all governments that are genuinely committed to negotiated peace processes should follow. The Indonesian government should sign a similar agreement with the ASNLF, as well as with the independence movement in West Papua, as soon as possible.

Indeed, the achievement of such an agreement should be a major objective of all of Indonesia's governmental and non-governmental partners in the international community.

Further peace talks between the ASNLF and the government were originally scheduled for later this month. They have now been postponed. In the light of recent events, one has to wonder if further talk will in fact be possible. Certainly the majority of Acehnese are battle-weary and want the violence to end.

But if the Indonesian government is willing to shoot the messengers, what hope can there be for a negotiated peace in Aceh?

[Lesley McCulloch, School of Asian Studies, University of Tasmania is conducting research on the conflict in Aceh.]

Government told to revive peace talks with rebels

Jakarta Post - July 15, 2002

Nani Farida and Muhammad Nafik, Banda Aceh/Jakarta -- As most Acehnese have rejected the government's proposal that a state of civil emergency be imposed on the restive province, there is no option left for the government except to forge ahead with dialog, activists and legislators said on Sunday.

Leader of the Aceh Referendum Information Center (SIRA) Muhammad Nazar said the central government should drop its proposal for a state of civil emergency, or even martial law, in Aceh and continue with the current round of peace talks so as to end the fighting.

"If a civil emergency or martial law is imposed, it will be impossible to find a resolution to the Aceh conflict through dialog," he told The Jakarta Post.

Lawmaker Ghazali Abas Adan said the central government had no choice but to accept the mounting calls by the Acehnese people to hold talks with the rebel Free Aceh Movement (GAM) and stop the shooting.

"There must be no more military operations that only make the poor people suffer ... don't kill any more people," Ghazali, an Acehnese representative in the People's Consultative Assembly (MPR), was quoted by Antara as saying.

He urged the central government to further "open its eyes" in an effort to resolve the conflict following last week's visit to Aceh by Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono.

Hours after Susilo and his entourage ended their visit on Saturday, Aceh Governor Abdullah Puteh said that 90 percent of the local people were opposed to the proposed imposition of a civil emergency to stop the fighting in the rebellious province.

Following a dialog with representatives of the Free Aceh Movement (GAM) in Geneva, the government announced in April that it planned to hold an "all-inclusive" dialog with the Acehnese this month. The plan, however, has not been realized. More than 9,000 people, mostly civilians, have died in Aceh since the 1970s when the armed rebellion started.

Those against the imposition of a state of civil emergency in Aceh include influential Muslim clerics, who play a major role in the strongly Muslim province, local government officials, legislators and human rights activists.

Susilo said the government would announce its decision on what to do with the province in August.

Nazar said the government had in reality imposed de facto martial law in Aceh with troops continuing to raid villages suspected of harboring rebels, and that it was now seeking a legal umbrella to intensify its military operation. "Especially now that there are plans to beef up security in Aceh," he added.

Nazar said the intensive sweeps had forced hundreds of civilians from at least 12 villages in the subdistrict of Simpang Ulim, East Aceh, to flee their homes since July 10, 2002.

Abdurrahman Yacob, another local human rights activist, demanded that the central government listen to the Acehnese people's wishes and protect them from all kinds of violence.

"The Aceh administration is the most knowledgeable about what is happening in Aceh and what is most needed by the people," he added. "If it is only intended to crush GAM and prevent the country from disintegrating, why should there be a civil emergency or martial law imposed?" he asked, referring to the rebel group by its acronym.

Yacob said that a dialog with all elements in Aceh, including GAM leaders, was the most appropriate way of resolving the conflict.

Yasril Ananta Baharuddin, a deputy chairman of the House defense and foreign affairs committee, said the government would be forced to reconsider its plan to impose a civil emergency in Aceh.

However, he stressed that his committee would continue to back the government's plan to take resolute action against the armed rebel group fighting for an independent state in Aceh. "Without firm action against separatism, the conflict will not be stopped," Yasril told the Post.

Claiming that long-running talks with GAM had not been effective, he said there should be no more negotiations with its leaders especially as they had taken up arms, killed and terrorized Acehnese people. "It is normal in other countries, including the United States, that separatists or terrorists will be crushed," Yasril said.

Meanwhile, Nahdlatul Ulama (NU) leader Solahuddin Wahid said that the Acehnese ulemas along with impartial foreigners should be involved in facilitating talks between the government and GAM.

Peace talks should be held on a ongoing basis to resolve the Aceh conflict, he said. "If this is not effective, another approach should be found," he added without elaborating.

Strong national support for emergency in Aceh

Straits Times - July 15, 2002

Jakarta -- Over 60 per cent of Indonesians back the imposition of a civil emergency in the restive Aceh province, according to a nationwide survey.

The poll, published in Media Indonesia newspaper yesterday, said 62 per cent of 613 respondents surveyed said a civilian emergency should be imposed on the province where the Free Aceh Rebel movement (GAM) has been fighting for independence for 25 years.

Some 43 per cent agreed with the imposition of martial law while nearly 70 per cent said they were not confident negotiations could resolve the conflict.

Jakarta's decision earlier this month to brand GAM a terrorist group found favour with 55 per cent of the respondents.

But the national view is at odds with the opinion of the locals who hold that conflict resolution should be entrusted to the provincial administration.

Yesterday, the Jakarta Post reported that Aceh Governor Abdullah Puteh had joined forces with the provincial legislative council, clerics and non-governmental organisations to oppose a civil emergency. He said 90 per cent of the Acehnese were against the proposed move.

"It is necessary to enforce the law to restore security and order but this must be followed simultaneously with concrete actions to improve the people's social welfare," he said.

Rural issues

Villagers' 20-year wait for fair compensation goes on

Jakarta Post - July 20, 2002

Blontank Poer, Semarang -- Calls for compensation are being voiced, nearly two decades after the construction project of a reservoir in the Central Java district of Kedungombo.

In the latest rally, 250 people paid a visit to the provincial legislative council on Thursday to demand reasonable compensation for land and houses cleared for the project.

Residents of Kedungombo urged the legislature to set up a special committee to resolve the various problems related to their forced eviction.

Secretary-general of the Association of Kedungombo Victims (SWKKO) and coordinator of the rally Muntono, said they demanded that Governor of Central Java Mardiyanto issue a decree stating that problems related to the construction of the reservoir had yet to be justly and lawfully addressed.

"A previous settlement scheme was deemed unlawful as the then government resorted to intimidation and violence to forcibly evict the people living around the dam." Muntono said.

The association's chairman, Parjan AR, said SWKKO was determined to fight for proper compensation.

"Some residents did receive compensation, they had no other choice but to accept the money as they were threatened. Many of them were labeled communists or had their ID cards stamped as members of an outlawed party, just because they refused to receive the compensation offered." Parjan explained.

The organization groups 842 families from 29 villages in the districts of Andong, Kemusu, Klego and Juwangi in Boyolali regency, Miri and Sumber Lawang districts in Sragen regency and Geyer district in Grobogan, The reservoir was built in 1984 to develop areas around Jragung, Tunang, Serayu, Lusi and Juwana rivers. The US$181,2 million project, which swamps an area of 6,514 hectares, was jointly funded by the World Bank and The Exim Bank of Japan. It is capable of storing 700 million cubic meters of water and irrigating 60 hectares of paddy fields in surrounding regencies.

Chairman of the National Awakening Party faction Abdul Kadir Karding, the only councillor who turned up for the meeting with representatives of the protesters, said his faction would proceed with the demand for the setting up of a special administrative team.

The team is expected to handle all remaining problems and to conduct an investigation to match data collected in the field with the provincial administration, Kadir said.

He added the provincial government had no difficulty in solving the land compensation for Sragen, Grobogan and Boyolali districts.

Some people in Srimulyo village, Kemusu district in Boyolali revealed they were not demanding an excessive price for their land cleared for the construction project.

"We have only been asking for Rp 3,000 per square meter as suggested by the late former minister of home affairs, Soeparjo Rustam, during a meeting with the House of Representatives Commission II on November 16, 1987. We had previously demanded Rp 15,000." said Ngatno, a resident of Mlangi village in Kemusu.

He added: "We are willing to bury the hatchet and settle the problem amicably if the government is willing to pay us a reasonable price. We could by 10 kilograms of rice for Rp 3,000 that time, but now the amount is too small."

Spokesman for the provincial administration, Anwar Cholil, said the local government would prioritize people living around the dam and they had devised a new settlement formula by giving each family compensation in accordance with the original size of their land and another Rp 25 million to build a new house.

Anwar explained the provincial administration had repeatedly invited residents and local non-governmental organizations, as well as Gadjah Mada-based sociologist J. Nasikun to discuss ways to solve unfinished issues in Kedungombo in the Committee for the Empowerment of Kedungombo (KOMPAK).

SWKKO broke away from KOMPAK on May 13, 2002 due to differences of opinion. Parjan said KOMPAK was only interested in the empowerment of the residents, not issues related to the compensation settlement.

Indonesia's tariff push seen unlikely to help farmers

Reuters - July 15, 2002

Grace Nirang, Jakarta -- Indonesia's plans to impose higher tariffs on a string of agricultural commodities might not help farmers as intended but instead raise consumer prices and encourage smuggling, analysts say.

They also say the benefits are likely be swallowed up by traders and intermediaries ahead of farmers in Indonesia's long and convoluted trading chain.

"Basically, we need tariffs to help our smallholder farmers profit from their farming activities, but I'm afraid it will be traders who will benefit," said H.S. Dillon, agriculture analyst at the Center of Agriculture Policy Studies.

"Imposing higher tariffs should be a temporary measure and it probably won't be effective in helping farmers at all." Indonesia, with a population of some 210 million, is among the world's largest importers of commodities such as rice and sugar and imposes comparatively low import tariffs.

Farmers have long complained about the influx of cheaper, imported commodities which have dragged down prices and discouraged them from increasing output.

In the latest round of tax increases, the Finance Ministry last week raised import tariffs on raw and white sugar by 50 rupiah ($0.0056)/kg and 100 rupiah/kg respectively.

Last month, Agriculture Minister Bungaran Saragih said the government was considering imposing a duty on corn and soybeans and hiking the duty on rice from its current level of 30 percent.

Porous borders

Industry sources say any moves to increase tariffs must be accompanied by strong enforcement or illegal imports would surge.

They say thousands of tonnes of imported foodstuffs arrive in Indonesia every year unreported, due to collusion with officials or through smuggling.

"The data we receive from exporting countries on the volume of sugar exported to Indonesia is always higher than the data from customs and excise," said Farukh Bakrie, chairman of the Indonesian Sugar Association.

Indonesia's vast and porous borders make smuggling relatively easy. Vessels bringing thousands of tonnes of rice or sugar from Vietnam or Thailand can dock in small islands off Sumatra and sell the commodities in Java or other islands as locally- produced.

"Ideally, higher tariffs should be followed up with tough enforcement in the field. But it is difficult for us to imagine that it would be fully enforced," said analyst Yayok Bayu Krishnamurti of the state Bogor Agricultural University (IPB).

While farmers have long bemoaned low tariffs, they have also benefitted from the policy. Low tariffs have helped contain the price of basic staples such as rice which has a large weighting on the local consumer price index.

"With more than 75 percent of our farmers also net consumers of rice and other foodstuffs, they will be the ones who are hit hard by rising prices," said Bustanul Arifin from the private think- tank Indef.

Indonesia's inflation fell for the fourth consecutive month in June, with a year-on-year level of 11.48 percent compared to 12.93 percent a month earlier.

Sweetener

In another sign of its protectionist stance, Trade and Industry Minister Rini Suwandi last week flagged sugar subsidies for farmers to encourage them to produce more of the commodity and reduce dependency on imports.

The planned 500 rupiah per kg subsidy -- which has to be approved by the Finance Ministry -- would cost the government an estimated 350-400 billion rupiah per year. Analysts say that this is a cost the cash-strapped government can ill afford, and that it goes against the spirit of free trade adopted by Indonesia in 1998.

"The government should be very careful. If these protectionist measures don't work well, Indonesia will be regarded as one of the countries which fails to cope with its free trade commitment," Indef's Arifin said.

Imported foodstuffs began flooding the local market after the government liberalised trade practices as part of an agreement with the International Monetary Fund in 1998. Prior to the agreement, the State Logistics Agency (Bulog) had an import monopoly on basic foodstuffs.

Analysts say a policy of higher tariffs should also come with a commitment by the government to use the proceeds to develop the agriculture sector, which employs around 60 percent of the population.

"If you want to increase production, you have to make farming profitable. The availability of farming materials at affordable prices, not tariffs, is the most important thing for farmers," Dillon said.

Neo-liberal globalisation

Supreme Court bows to international pressure

World Socialist Web Site - July 17, 2002

John Roberts -- Under considerable international pressure, the Supreme Court of Indonesia on July 8 overruled a decision by the country's Commercial Court declaring bankrupt the local subsidiary of the Canadian-based Manulife Financial Corporation.

The June 13 Commercial Court judgment, which threatened Manulife's assets in a company considered solvent by Indonesia's finance ministry, had provoked outrage in international financial circles and warnings of a collapse of foreign investment.

At the heart of the protracted legal dispute is a determined rearguard action by sections of Indonesian business to hold together empires that collapsed in the course of the Asian financial crisis in 1997-98. Many of their holdings plummetted in value and were bought up at firesale prices by investors, local and foreign, or were taken over by the Indonesian Bank Restructuring Agency. The IMF and World Bank are insisting that the Indonesian judicial system be reformed to protect the interests of international investors.

The original bankruptcy ruling was sought by Indonesian tycoon Suyanto Gondokusumo, whose family company PT Dharmala Sakti Sejahtera (DSS), owned a 40 percent share in the Manulife subsidiary, PT Asuransi Jiwa Manulife Indonesia (AJMI). DSS, however, declared bankruptcy in May 2000 and Manulife bought up the share in a government-supervised auction sale in October 2000.

The purchase has been subject of bitter legal wrangling. It was immediately challenged by a company called Roman Gold Assets based in the British Virgin Islands, which claimed to have bought the stake two weeks before the auction. Manulife alleged that Roman Gold Assets was simply a front for the Gondokusumo family. But on the basis of the challenge, AJMI vice-chairman Adi Purnomo was accused of fraud and jailed in Jakarta. He was only released after Canadian Prime Minister Jean Chritien personally intervened to warn Indonesian President Abdurrahman Wahid of adverse consequences.

Gondokusumo then launched bankruptcy proceedings in the Commercial Court, which was established in 1999 at the behest of the international finance institutions to reform business law. Far from being insolvent, AJMI is Indonesian's fourth largest life insurer with 400,000 policy holders and assets of some $US360 million. But the petitioners claimed that AJMI had failed to pay a dividend to Gondokusumo's DSS in 1999, even though the company had made a profit.

In June, three Commercial Court judges ruled in Gondokusumo's favour, pointing out that the terms of the joint venture had included the payment of a dividend if profits were registered. Manulife argued that it had been bound by a decision of its shareholders, who had voted in mid-2000 to withhold any payment because of economic certainty. Manulife was the majority stakeholder in AJMI with 51 percent of shares.

A little over a week later, Manulife found a full-page advertisement placed by the court-appointed receiver, Kalisutan, in the daily Bisnis newspaper announcing that AJMI would cease trading and close the doors of its 75 branches. Manulife Indonesia chairman Victor Apps declared: "We have been threatened [by the receiver] to close our offices or our employees will be arrested. We will not be in a position of jeopardising the safety of our people." Company president Philip Hampden-Smith denounced Kalisutan's actions as "trying to ruin the business".

Both the company and the Canadian government responded angrily to the Commercial Court ruling and the receiver's actions. Manulife attacked the ruling as "bought and paid for" by the Gondokusumo family. The chief executive of the Canadian parent, Dominic D'Alessandro, said his company had been the victim of "a public mugging" and the company launched an appeal in the Supreme Court in Jakarta. Manulife lawyers pointed out that Kalisutan had connections to the Gondokusumo family company and was not a current member of Indonesian Receivers Association.

Canadian Secretary of State for Asia-Pacific, David Kilgour, visited Jakarta calling for a reversal of the decision. He told the media: "The Indonesian government should seek a court order to preclude the receiver from disbursing any money and begin an immediate investigation of all those involved in the campaign against Manulife." Canadian officials hinted at economic retaliation against Indonesia.

Canada's open intervention provoked a reaction in Indonesia. Vice-President Hamzah Haz told the Canadian government to back off and leave the matter to the Indonesian courts. "[They] can complain through the mechanism but don't try threats," he told the journalists. But Jakarta was quickly forced to change its tune as it faced a barrage of protests and threats by the spokesmen of international finance capital.

International campaign

The IMF seized on the Manulife case to demand that the Indonesian government speed up the reform of the Commercial Court and the revision of the country's bankruptcy laws. "Legal and judicial sector reforms remain critical to a sustained improvement in investment climate. A recent high-profile controversial ruling underscores the need for an acceleration of reforms in this area," Anne Krueger, IMF first deputy managing director, declared in late June.

The implied threat was obvious. Unless the Manulife decision was reversed, Indonesia faced a flight of international capital and the danger that the IMF could withhold its loans. Foreign investment has already been plummetting. Foreign direct investment approvals, which were $15.4 billion in 2000, fell to $9 billion in 2001 and by a massive 59 percent to $1.6 billion in the first five months of 2002.

US Chamber of Commerce president in Jakarta, Carol Hessler, declared: "Unfortunately decisions like this are more routine than shocking. It is a desperate situation for foreign investment. How can you invest in Indonesia in this environment?" The commercial arm of the World Bank, the International Finance Corporation (IFC), which owns a 9 percent stake in Manulife Indonesia, said it would be reviewing its investment activities in the light of the June 13 ruling. IFC official Amitava Banerjee told the New York Times that the case had shown that big companies "can be bought down by the machinations of malicious parties, and there is no legal protection in the court of law".

The New York Times commented that the situation facing foreign investors was more chaotic than under the Suharto regime. "Foreign executives say it is increasingly difficult to do business in Indonesia because the courts are often a marketplace where the sizes of bribes decide cases. Under Suharto, they say, corruption was at least organised in a fairly predictable hierarchical system; now it is running out of control." Faced with this mounting pressure, President Megawati Sukarnoputri's administration began to move against the Commercial Court. The three judges who authored the June 13 decision were relieved of their duties. Their ruling was subject to an investigation by the Jakarta High Court, which reported to Supreme Court Chief Justice Bagir Manan. In addition the Ministry of Justice and Human Rights began a separate investigation.

On June 27, in response to Canadian demands, the receiver Kalisutan announced that he had resigned following further developments in the case and comments from government officials. On July 6, at the instigation of the Ministry of Justice and Human Rights, police began to examine the bank accounts of the three Commercial Court judges to determine whether there was any evidence of bribery.

The international reaction to the July 8 Supreme Court decision overturning the bankruptcy ruling has been generally favourable. Manulife executive Victor Apps told journalists in Hong Kong that he regarded the decision as "a watershed". "There's nothing to be gained by continuing this [corrupt] process, everybody is a loser," he said.

The Supreme Court ruling was, however, based on a technicality. It found that the original bankruptcy petition did not have prior approval from a judge as required by Indonesia's bankruptcy laws. The decision opens up the possibility of new bankruptcy proceedings, which have already been mooted by the receiver of the Gondokusumo family's failed company DSS.

Whatever the exact legal outcome, the Manulife case is going to be used by international investors to step up pressure on the Megawati administration for far-reaching legal changes to protect their interests.

'War on terrorism'

Indonesian linked to al Qaeda cell

CNN - July 19, 2002

Maria Ressa, Jakarta -- An Indonesian man is being linked to the top echelons of the al Qaeda terrorist network with officials saying he allegedly helped bring hundreds of operatives from Europe to a training camp he set up in Indonesia.

Agus Dwikarna was arrested in March in the Philippines and sentenced last week to up to ten years in prison for possession of explosives.

Intelligence officials tell CNN that the Dwikarna also used the training camp to help fuel sectarian violence in Indonesia in which thousands died.

Though Dwikarna claims he was set up, intelligence officials in the region tell CNN that he is connected to the al Qaeda cell in Spain whose leader, Imad Eddin Barakat Yarbas, was in frequent contact with Mohammed Atta, the suspected leader of the September 11 hijackers. Yarbas has been in Spanish custody since last November, charged with recruiting and fund-raising for al Qaeda.

After Barakat's arrest, Spanish police began looking for the Indonesian who worked with him: Parlindungan Siregar. Siregar worked as the go-between man for Dwikarna and arranged for several hundred al Qaeda operatives from Europe to travel to Indonesia for training, Spanish authorities say.

A Spanish court document released last November says that Siregar, "recruited mujahideens in Spain to be sent to terrorist-military training camps in Afghanistan, Bosnia and Indonesia." The document called Siregar, "the leader of one of the existing camps in [Indonesia] at the service of Osama bin Laden."

Intelligence officials tell CNN that the camp in Indonesia was set up by Dwikarna, who commanded Laskar Jundullah, an extremist militant group based in Poso, on Sulawesi east of Jakarta.

Intelligence documents obtained by CNN say the camp helped fuel Muslim-Christian violence in Poso and nearby Ambon in Indonesia's Maluku Islands where nearly 10,000 people have died there since 1999 because of sectarian violence.

After September 11, officials in the region say Ambon became the new Afghanistan for Muslim fighters around the world. "They were initially inspired by the war in Afghanistan. Now without Afghanistan, they use Ambon in the Malukus as the new battleground," Lee Kuan Yew, Singapore's senior minister, said.

Highest levels

But Dwikarna's connections with al Qaeda in Europe went much further and reached to the highest levels. Intelligence officials say that in June 2000, Dwikarna acted as a guide for al Qaeda leaders who visited Indonesia: Osama bin Laden's second-in- command Ayman al-Zawahiri and Mohammed Atef, al Qaeda's former military chief.

Religious violence in Ambon and Poso has left almost 10,000 dead "This visit was part of a wider strategy of shifting the base of Osama Bin Laden's terrorist operations from the Subcontinent to South East Asia," an intelligence document obtained by CNN explains.

Though that move didn't happen, intelligence officials say that it is becoming clear that Osama bin Laden exploited Muslim discontent around the world to create potent, homegrown terrorist networks. These networks may have worked together to plan the attacks on the Pentagon and the World Trade Center, officials say.

US sources and Asian intelligence officials now tell CNN they believe the planning for September 11 started in Malaysia and ended in Spain and may have been helped by men like Dwikarna.

Indonesian cleric accuses US of anti-Muslim plan

Radio Australia - July 15, 2002

A radical Indonesian Muslim cleric that Singapore accuses of leading a terrorist network, has accused Washington of being behind a recent Philippine court's jailing of an Indonesian over weapons possession.

Abu Bakar Ba'asyir says a ten-year jail sentence on an Indonesian last week, is part of a grand scenario prepared by the United States to eliminate Muslim leaders and activists.

Agus Dwikarna was arrested at Manila airport in March along with two other Indonesians who have since been released.

He has also been accused of involvement in a Manila bomb blast in December, 2000 and an explosion that wounded the Philippine Ambassador to Indonesia in August the same year.

Ba'asyir, who heads the hardline Indonesian Mujahidin Council, has been named by Singapore's senior minister Lee Kuan Yew as one of the leaders of terrorist cells active in Indonesia.

Government & politics

Most civil servants unproductive, unskilled

Jakarta Post - July 20, 2002

Jakarta -- State Minister of Administrative Reforms Feisal Tamin has criticized the civil service, saying some 60 percent, or 3,000,000, of its five million staff are unproductive, unprofessional and corrupt.

"Around 60 percent of our civil servants are unproductive and have low standards of professionalism. Some go to office just to read a newspaper and many only see their offices once a year," Feisal said after swearing in new executives of the Civil Servants Corps office in Batam, Riau, on Friday.

Overstaffing in government offices across the country dates back to the New Order era but no concrete action has been taken to solve the problem due to the high unemployment rate. Unemployment has reached 48 million nationwide.

Feisal said all government offices, agencies and state-owned companies employing civil servants should be reorganized in a move to minimize overstaffing.

"We currently have five million civil servants, but only 40 percent of them have the skills and qualifications needed to do their tasks properly. With the proposed organizational revamp, a government office should no longer be over or short staffed," he said.

The minister, who is a former secretary-general of the home ministry and former chairman of the Indonesian Civil Servants Corps (Korpri), acknowledged that corruption and collusion was rampant in the civil service but said it was very difficult to minimize because of the absence of data and of reports on the practices.

"Qualitatively, the number of legal violations and corruption cases in the civil service is very high, and many have been punished according to civil service rulings and the law," he said.

Feisal has called on the public to report corrupt civil servants through P.O. Box 5000, saying his office would look into reports and complaints submitted through the post box.

"The public, including journalists, are encouraged to report corrupt government workers, complete with data to allow investigators to probe the cases professionally," he said.

He said the government would also issue a ruling barring government officers from occupying two jobs because it would make them unprofessional and unproductive and simultaneously decrease job opportunities for others. Feisal said further that the government was also considering a return to the six-day working week for civil servants to provide optimum service to the public.

"The five-day working week, which was implemented almost 10 years ago, has been found to be ineffective, leading to inefficiency in the provision of government services," he said.

Row over wording delays bill to protect children

Straits Times - July 20, 2002

Devi Asmarani, Jakarta -- Indonesia's highest Islamic body is insisting that foster parents must be of the same faith as their adopted children to prevent forced religious conversions.

The demand, by the Indonesian Ulama Council (MUI), has delayed the passage of a much-awaited child protection Bill.

The MUI and several other Muslim groups met Parliament members on Thursday, when the Bill was to have been passed, to pressure the legislators to make changes in a clause to which they objected.

The contentious clause was Article 37, verse 3, in the draft law which stipulates that people who are qualified as foster parents "ought to be of the same faith as the foster children".

The MUI and several Muslim groups thought this clause was not strong enough and they demanded the word "ought" be changed to "must".

MUI secretary Din Syamsuddin pointed out that the clause was "inconsistent" with the rest of the draft law. Article 33, for instance, stipulated that a guardian appointed by the courts must be of the same religion as the child, he said. It could be the same in Article 37, he argued.

He told The Straits Times: "We are also worried that because of this clause, there would be people who would become foster parents to children who would end up renouncing their religion and become apostates." He said MUI detected "thousands of such cases in the country" but would not say which religion many of the Muslim children were forced to convert to.

But he was most likely referring to the issue of "Christianisation" of Muslim worshippers said to be observed in the 1980s, although there were no actual studies or statistic proving the cases existed.

The Bill, according to Mr Din, would trigger religious conflicts in the country, not unlike those in the Maluku islands and Central Sulawesi. "Our purpose is good, we should not add more problems to the nation, sowing time bombs among religious worshippers that will erupt in the future," he said.

Four Muslim-based factions in Parliament supported the MUI's demand but five others did not want the change. The Bill was to have been signed by President Megawati Sukarnoputri on the occasion of the National Children's Day on July 23.

It was highly anticipated as it addresses pressing issues such as child trafficking, abuse and narcotics. Parliament has now gone into recess and the Bill can only be discussed in September.

Mr Posma Lumban Tobing, head of the Parliamentarian team drafting the Bill, told The Straits Times: "I am very disappointed that we could not give this as a present to the children on their day. MUI and politicians have overlooked the core of the draft law, which is children. Religion is important and must be respected, but this is not about religion," he said.

But children's rights advocates denounced his views, saying it was more about politics and religious sentiment than about the interests of the children.

First money, now House blames public for failures

Jakarta Post - July 20, 2002

Kurniawan Hari, Jakarta -- The House of Representatives (DPR) ended its session on Friday with House Speaker Akbar Tandjung blaming the public for its legislative shortcomings.

The house managed to approve only three out of 22 bills targeted to be completed during the sitting that started on May 13, Akbar acknowledged.

"The target couldn't be fulfilled as the deliberation process takes time for intense discussion and the accommodation of input from the public," said Akbar in closing the session.

His statement was markedly different from the earlier excuse given during a consultation meeting with President Megawati Soekarnoputri on Tuesday. During the meeting, the House leaders had asked for more money so as to ensure the speedier passage of bills.

President Megawati, who revealed the request during a press conference, did not specifically mention the amount of money sought or whether she had approved the request.

The poor performance of the legislators in carrying out their legislative functions has become the target of much public criticism. The inability of the House to fulfill its legislative program is widely see as the result of its penchant for political bickering.

In the previous session, which lasted from January 7 to March 28, the House only managed the passage of 4 bills. But this session was even worse as the legislators only passed three bills into law. They were the bills on calculation of the 2000 state budget, the national scientific and technological system, and copyright.

Under the 16-month presidency of B.J. Habibie, the government and the legislators managed to enact 68 laws.

Akbar, a defendant in a Rp 40 billion (US$4.4 million) financial scandal in the State Logistics Agency (Bulog), pointed out that currently the House was preparing to deliberate 47 bills during the next sitting, which runs from August 16 through September. 27. Of these bills, 29 were drafted by the legislators themselves.

According to Akbar, the House would focus on the deliberation of the bills on political parties and elections as these two bills were urgently needed in the run-up to the 2004 general election. In addition, he said, bills on the presidency, electricity, the central bank and state loans would also be prioritized.

In other parts of his speech, Akbar revealed that he had received a letter from President Megawati asking legislators to delay the deliberation of the presidency bill until the amendment to the 1945 Constitution had been completed.

This is the second such request from Megawati following a similar request last January. Megawati argued in the letter that if the House went ahead with the deliberation of the presidency bill, it could find itself in conflict with the amended Constitution.

The presidency bill consists of nine chapters and 49 articles that regulates everything related to the powers and the institution of the presidency. The bill also places restrictions on the gifts that the president may accept from counterparts. The bill sets the maximum value at Rp 25 million.

It further sets out the requirements that the president must comply with in appointing cabinet ministers, the military commander and the police chief.

Jakarta shifts powers from local regents to governors

Straits Times - July 19, 2002

Marianne Kearney, Jakarta -- Confusion over the powers of local regents, or district heads, who have been empowered under Indonesia's messy autonomy laws, has finally come to a head with Jakarta delegating powers to governors.

This move, based partly on the increasing number of complaints that regents are undermining governors, will prevent inexperienced regents from trying to negotiate foreign investment deals, issue business licences and balance local government budgets.

Under Indonesia's autonomy laws, regents have been empowered to manage most government functions.

However, Minister for Home Affairs Hari Subarno complained on Wednesday that regents had become too powerful and were making decisions that should come under the purview of the central government.

He said the central government also wanted to give more power to provincial governors who were taking a back seat in managing local affairs. "Currently, several regencies have held business agreements with foreign parties without approval from their governors," said Mr Hari.

Under the new guidelines issued by the Home Affairs Ministry, provincial governors will be responsible for city and district planning, issuing licences for logging or mining, supervising local budgets, maintaining security and supervising any foreign investments or agreements. Observers say the former Habibie government's attempt to limit the power of the provincial governments -- on fears that they would become far too independent of Jakarta -- is now backfiring.

"I think the government realises that in cases where the provinces have become too weak to assume strong roles, then the kabupatens are becoming a pain in the neck," said Mr Bernard May, a regional autonomy adviser from the German Agency for Technical Cooperation (GTZ).

In several regions, there is tough competition between kabupaten (district) governments and provincial governments for control over natural resources and administrative duties, say officials from the Ministry of Home Affairs.

For example, regents in resource-rich provinces such as Kalimantan or Sumatra are often keen to issue logging licences, but the provincial government may want to restrict logging or industrial plantation in certain areas for environmental reasons.

"Wherever money is involved, such as the licensing of businesses, there are heavy contenders between districts, but if it is welfare or security issues involved, then the district governments don't mind if regional governments take control," said Mr May.

Under Indonesia's sweeping but confusing regional autonomy laws introduced in January 2000, district kabupaten governments manage most government affairs. However, the laws on regional autonomy often conflict with other laws and only vaguely describe the powers of the central and provincial governments.

The central government still oversees defence, the budget, foreign policy, religious affairs and the legal system.

As a result of these unclear laws, many regents have passed local laws and raised local taxes which Jakarta late last year decided to revoke.

The Finance Ministry last year said about 71 regulations issued by regency governments either overlapped with central government laws or hindered investment and trade.

President seeks support to pass key bills

Radio Australia - July 18, 2002

Indonesian President Megawati Sukarnoputri has called upon party leaders to speed up the passing of key Bills which are holding up economic reforms. In an unprecedented move, the president met with the speaker of the House Akbar Tanjung, ministers and party faction leaders to seek passage of four economic bills -- promised in part to the International Monetary Fund, in return for a five billion US dollar aid package. They include the state debt instrument bill, the electricity bill, the central bank bill and the privatisation bill. However, Parliament, whose current session ends on Friday, says it can only pass two, and is demanding more funds -- funds which critics say are often inappropriately used by parliamentarians, including stays in luxury hotels.

Transcript:

Hasibuan: "One of the key areas that the public has been complaining of this time around about the performance of their house members, his actually in ability to meet their expectations in terms of passing all these bills. So if they're now asking for more money from the government to enable them to speed up the law making process I think it's very outrageous."

Lam: But have they explained how the funds will aid them in accelerating the passage of the bills?

Hasibuan: "I'm not sure if there was any detail to that, that they were just asking for money if the government expected them to get their act together on passing all these bills, which I think is very, very outrageous."

Lam: And if you were to hazard a guess do you think the government is likely to grant their request?

Hasibuan: "I think it would depend on what sort of public outrage you know, or what sort of response that the public would have on this. And if there's enough public outrage then I think the government would not even think of vending these funds. There's actually a fee, for example the government proposes some kind of a draft and usually without any hesitation some members of the parliament would actually come up with the fee, with a special fee you know -- if you want this bill to be passed then the fee is like this, you know what I mean? That would be in addition to the expenses put in delivering the draft, so I think it's pretty ironic."

Lam: Many of the reforms, which are needed to put Indonesia's economy back on track, have met with some resistance in some quarters. Is that due largely to opposition to the demands of the International Monetary Fund?

Hasibuan: "Well I think partly, and of course at the same time the government has not really stepped up the points -- but you're right, there has been strong resistance coming from the parliament in terms of meeting all these points being put in the IMF letter of intent. If you look at all these points, if you want to implement those points effectively then there would be enough victims and those victims are businesses that have close ties with the past regime. And these people still have enough money and I think one way to do it for them to protect their interests would be to go to the parliament and then they would channel their money to the parliament in order to protect their businesses."

Lam: So it's really a case of personal interests taking precedence over everything else?

Hasibuan: "Exactly yes."

Lam: Is that one of the main obstacles holding back Indonesia from the economic reforms so essential to putting it back on its feet?

Hasibuan: "I would say so, I would say so. It seems very hard for the new political actors in the so-called reformasi period to disassociate themselves from the business actors that sort of thrived under the old regime. Like I've said before, these people who have vast resources which could be channeled any time to various parties. So I think it would be one of the biggest impediments to reform."

Lam: And finally Bara Hasibuan President Megawati presents her progress report next month at the annual session of the National Assembly. What is the perception of her performance in the past year?

Hasibuan: "Well I think the consensus of that is people are not too happy with her performance on the government but at the same time the world is like, there's not enough justification for us yet have another transfer of power you know? So irrespective of the fact that she hasn't really stood up to the plate, that's not really enough justification for yet another transfer of power. So I think people are sick and tired of seeing all this political bickering every year, so they would I think rather stick around with Megawati until 2004."

Party cadres outraged over Mega's decree

Straits Times - July 19, 2002

Devi Asmarani, Jakarta -- President Megawati Sukarnoputri has come under fire for issuing a decree ordering members of her Indonesian Democratic Party-Struggle (PDI-P) to support controversial Jakarta Governor Sutiyoso's re-election. Those who defy her order could face severe sanctions from the party.

The move has outraged some party members and political analysts, who said her undemocratic, authoritarian leadership reminded them of the New Order regime of former president Suharto.

In the letter issued on Monday, Ms Megawati, who is the PDI-P chairman, instructed the party's executives and cadres to "secure, implement and fight for the re-election of Sutiyoso as the Jakarta governor".

Some PDI-P members in the Jakarta City Council, which will elect the new governor in September, have threatened to quit en masse if they are forced to comply with the directive. They had earlier decided to nominate their own cadres.

They said the directive was an intervention that violated the spirit of reform and resembled Mr Suharto's past practice of handpicking governors.

Legislator Sugondo tendered her resignation from Parliament to protest against the decision. She is the third PDI-P legislator to resign this year over the government's direction. Several PDI-P officials have complained of Ms Megawati's "one-woman- show".

They said she rarely attended party meetings, and only relied on the input of a handful of people within her inner circle, especially her powerful husband Taufik Kiemas.

Said PDI-P legislator Meilono Suwondo: "She would hold one-to-one meetings with certain people on certain issues, and the next thing we knew decisions were already made without us even knowing it."

But Ms Megawati's leadership is supported by the party's guidelines. In 1998, the party decided to give its chairman unlimited power to hasten the decision-making process ahead of the 1999 General Election. This and the fact that she "does not like to be criticised or challenged" had stirred resentment within the party.

As a result, Mr Meilono said many PDI-P legislators were no longer motivated to work. "What's the use of holding a meeting or making plans, if in the end what matters is the advice she got from the few people around her."

Political analyst Soedjati Djiwandono of the Ridep Institute warned that Ms Megawati's utter disregard for her party cadres' views and feelings could lead to her and the PDI-P's undoing.

He added: "The ties that used to bind the PDI-P and served as its rallying point was Megawati's image as a challenger and a victim of Suharto's political repression. I think this image will have faded by 2004, if her leadership is no different than his."

Tensions building in PDI-P THE decree has added fuel to tension within the PDI-P, after its much-criticised decision not to seek a parliamentary inquiry into alleged graft by Parliament Speaker Akbar Tandjung.

Many party members said the decision was made in exchange for support from Mr Akbar's Golkar party in next month's annual session of the National Assembly.

Megawati keeping authoritarianism alive, say critics

Jakarta Post - July 19, 2002

Muhammad Nafik and Fabiola Desy Unidjaja, Jakarta -- President Megawati Soekarnoputri, once a popular opposition leader, has developed authoritarian and aloof traits during her one year as the nation's leader, a tendency that could undermine democracy, say analysts.

Mochtar Buchori, a legislator from Megawati's Indonesian Democratic Party of Struggle (PDI Perjuangan) and once one of her closest aides, said she was emulating former dictator Soeharto in the way she treated democracy.

"She is authoritarian and aloof. She listens to the opinions of others but eventually decides things on her own, and nobody dares to defy her," Mochtar told The Jakarta Post on Thursday. He was commenting on Megawati's complaints on Wednesday that she often received misleading reports from her ministers and other senior government officials eager to please her.

However, a number of politicians once close to Megawati blamed the officials' obsequious behavior on Megawati's dislike of criticism.

Mochtar and another legislator, Indira Damayanti Sugondo, who recently tendered her resignation from the PDI Perjuangan faction in the House of Representatives, said that by nature Megawati did not like to be criticized.

"I used to often meet her [Megawati] before she became vice president. But she soon ditched me after she found I wasn't going to go out of my way to please her," recounted Mochtar, who is also a noted education observer. "She prefers to embrace newcomers as they'll go that extra mile to keep her happy," he added.

Mochtar said Megawati had no mechanism for double-checking on the information and reports she received from ministers and other officials. He asserted that the President also cultivated a "feudalistic bureaucracy", which tended to discourage her subordinates from telling the truth.

He said that only State Minister for National Development Planning Kwik Kian Gie, who is also the director of the National Development Planning Agency (Bappenas), dared say no to Megawati. "But, consequently, he finds himself isolated," he added.

Kwik is known for his staunch criticism of the International Monetary Fund and the government's soft-line approach to the errant debtors who are blamed by many for the prolonged economic crisis. It was once rumored he was going to be dismissed from Megawati's Cabinet.

The public's discontent with and distrust of Megawati's government has mounted since she backed the reelection of Jakarta Governor Sutiyoso for a second five-year term at the expense of one of her own party members who was nominated by the PDI Perjuangan's Jakarta chapter.

Sutiyoso is accused of involvement in the July 27, 1996, attack on Megawati's party headquarters when he was the Jakarta military commander.

Noted political analysts, including Arief Budiman and J. Kristiadi, have accused her of killing democracy within the PDI Perjuangan by ignoring the wishes of her constituents at the grassroots level.

Separately, political analyst Fachry Ali said Megawati was promoting a "personal leadership style" that encouraged her ministers to assuage her with bland or flattering reports. "Her ministers will only go to her if they're sure she will approve their ideas," he told the Post.

Legislators do not deserve more money: Activists

Jakarta Post - July 18, 2002

Kurniawan Hari, Jakarta -- Anti-corruption campaigners questioned on Wednesday a demand from the House of Representatives (DPR) for additional funds for bill deliberations, arguing that the legislators' disappointing performance did not warrant a financial reward.

Teten Masduki of the Indonesian Corruption Watch (ICW) and political analyst Denny J.A. suspected that the funds, if granted, would be spent on entertainment and other unrelated activities rather than bill deliberations.

"Legislators do not deserve a higher budget. Megawati must not give in to their demands," Teten told The Jakarta Post on Wednesday.

Denny, the host of the Legislature Watch talk show, broadcast by a private television station, added that it would be easy to revise the budget plan, but the reason was not strong enough.

Denny said the public was too disappointed with the performance of the House in legislation, therefore the demand did not have solid grounds.

The House's failure to meet its legislation duties has eventually put reform movement on hold.

Both Teten and Denny were commenting on a demand by House leaders during a consultation meeting with President Megawati Soekarnoputri for more funds.

Speaking to the media after the closed-door meeting, Megawati said that additional funds would be used to speed up the law- making process.

She did not specify the amount requested by legislators or whether she had agreed to the demand. Teten said the public questioned the demand because the legislators could not give a better performance in their legislative role.

In the last session from January 7 through March 28, the House passed only three bills into law despite its earlier set target of 24 bills.

Deputy House speaker Soetardjo Soerjogoeritno hoped at the session's opening on May 13 that it would complete the deliberation of 22 bills.

However, only two bills have been passed into law and the session is scheduled to end on Friday. With only two days left, it will be impossible for the House to meet its target.

Critics have said a lack of discipline and political bickering among legislators were the main reasons for the poor performance in legislation. "Is it true that the poor legislative record is caused by a lack of funds? I am afraid they would be spent to fund activities outside the House building," Teten said.

Teten, a tough anti-corruption campaigner, said that the legislators receive enough in their salary to cope with their legislative tasks. Therefore, additional funds were not needed, he said.

Each legislator earns about Rp 12.4 million (US$1,370) per month. A legislator also receives Rp 750,000 for every bill deliberated and an additional Rp 300,000 for each hearing with counterparts.

Legislator Djoko Susilo of the Reform faction said that the Rp 300,000 was not given at every hearing. "It's not certain. Sometimes I get the money, but other times I don't," he told the Post.

He said that the budget for every bill to be deliberated was estimated at Rp 1 billion. The money was spent to fund comparative studies in foreign countries and consultations with scholars as well as to outline the bills and make them available to the public.

Denny, meanwhile, said poor legislation was mainly because of legislators' interest in political bickering over hot issues. "Legislators are enthusiastic in responding to hot issues, but they are not disciplined in legislative activities," he said without elaborating.

Fawning officials get on Mega's nerves

Straits Times - July 18, 2002

Jakarta -- Sycophantic officials are getting on the Indonesian President Megawati Sukarnoputri's nerves. Some of them, she complained yesterday, have developed a habit of asal ibu senang or "keeping Madam President happy".

In the past, there was the asal bapak senang or "keeping Mr President happy" habit, she observed. "Now there has emerged this asal ibu senang to annoy me," she said at the opening of a livestock and fishery forum on Bali island.

When Fisheries Minister Rochimin Dahuri reported that catches had risen from 3.6 million tonnes in 1998 to 4.5 million tonnes in 2001, the President elicited laughter from the audience when she quipped: "I wonder whether this is some kind of 'keep Madam President happy' report." Ms Megawati, quoted by the state Antara news agency, also urged some ministers to shed their arrogant attitude by joining her on her provincial tours.

The President, who marks a year in power next week, also took ordinary Indonesians to task for failing to exploit natural resources. "We have been lulled by the story of rich resources. However, when it comes to hard work, we hardly work," she remarked.

Earlier this year, she had delivered a stinging rebuke to the bureaucracy, describing her administration as a "trash can" and telling officials to go out and check reports instead of staying desk-bound.

"I have been leading a government which I think is like a trash can because bureaucrats only want to receive good news," she had said. She noted whenever she toured the country, the local government's protocol officials always made sure she visited places which were performing well.

"What is the point in my visiting these places if I hear only good news?" But Ms Megawati herself has also been at the receiving end of criticism herself, for not doing enough to curb corruption in the bureaucracy.

Muslim politicians meet to counter nationalist alliance

Jakarta Post - July 16, 2002

Muhammad Nafik, Jakarta -- Senior politicians from Muslim-based parties met again here on Monday in an apparent move to counter a coalition between the Indonesian Democratic Party of Struggle (PDI Perjuangan) and the Golkar Party, the two largest political parties.

The meeting, held at the Al-Azhar mosque complex in South Jakarta, sparked fresh worries that political parties would be polarized into nationalist and Islamic groupings ahead of the 2004 elections as occurred in 1970s.

Similar gatherings have taken place since May with senior Muslim leaders, including People's Consultative Assembly (MPR) Speaker Amien Rais, and many others from political parties and various Muslim organizations attending.

The recent meetings, including the latest informal gathering on Monday, fueled speculation that Muslim leaders were trying to establish an Islamic alliance aimed at bettering ties and challenging the nationalist-oriented PDI Perjuangan.

At the same time, PDI Perjuangan, which President Megawati Soekarnoputri currently leads, has apparently formed a coalition with Golkar ahead of the MPR's Annual Session in August, which is expected to finalize the fourth package of constitutional amendments.

The two largest parties reportedly agreed in a backroom deal last week that a deadlock must be avoided in the constitutional amendment process at the Annual Session after the PDI Perjuangan ended its resistance to a direct presidential election.

Similarly, the newly allied Muslim politicians discussed equally contentious issues such as the direct presidential election, the composition of the MPR, education and religious affairs. Monday's meeting, at least the fifth since May, was attended by eleven Muslim politicians from the United Development Party (PPP), the National Awakening Party (PKB), the National Mandate Party (PAN) and the Justice Party (PK).

Those present included Yusuf Muhammad and Ali Masykur Musa, both from the PKB, A.M. Luthfi of PAN who chairs the Reform Faction in the MPR and Lukman Hakim Saifuddin from PPP. Hamdan Zoelva of the Crescent Star Party (PBB) had promised to come but failed to show up.

Most of the participants are members of the MPR's ad hoc committee in charge of deliberating on the amendments of the 1945 Constitution.

The four-hour meeting, which started at 1:20 p.m., was used to discuss Articles 29 and 31 of the Constitution which deal with religious and education affairs.

Speaking to journalists after the meeting, Luthfi and Yusuf told journalists that all the participants approved Alternative 3 in Article 31 that says the national education system should be aimed at improving people's religious faith and devoutness and their noble character as well as sharpening their minds.

However, the politicians were divided on two alternatives offered in Article 29 on religion.

The PKB and Reform Faction, which consists of PK and PAN, supported the wording that stated, "... The state shall be based on One God with followers required to carry out religious teachings according to their respective faiths..." Meanwhile, the PPP and the PBB supported a provision, under which the state is based on One God with Muslims required to carry out their religious teachings.

However, the Muslim politicians all backed a provision also in the Article 29 that said the state would guarantee freedom for individuals to practice their respective religions and perform rituals according their own faiths.

Major parties plot to thwart Amien

Straits Times - July 16, 2002

Devi Asmarani, Jakarta -- Two of the largest parties in the Indonesian Parliament, the ruling PDI-P and Golkar, are trying to dislodge Mr Amien Rais as the National Assembly Speaker next month in an apparent bid to thwart his presidential ambitions.

The move comes after recent polls showed that his popularity is rising and that he is perceived as the main challenger to President Megawati Sukarnoputri in the 2004 election.

Talk of a reshuffle in the National Assembly (MPR) leadership when it reconvenes next month has been in the air for the past two weeks. It could lead to the replacement of Mr Amien, who chairs the tiny National Mandate Party (PAN) in parliament.

A Golkar legislator told The Straits Times: "With PAN having only 7 per cent of the seats in the MPR, it is unfair that the highest legislative body is headed by Mr Amien. We want to see that changed." PAN holds 48 seats in the 700-member body.

The assembly's non-elected Regional Representative faction put up the reshuffle proposal last week and Golkar -- the second-largest party in parliament -- supported it.

Golkar has reason to be miffed with Mr Amien, who backed the establishment of a special parliamentary team to probe its party chief and parliamentary Speaker Akbar Tandjung for alleged corruption. But the proposal came to nought after other major parties rejected it.

A high-ranking Golkar official said of Mr Amien's political career: "We have to terminate it with extreme prejudice." Referring to a sense of betrayal felt by Golkar, political analyst Affan Gaffar told The Straits Times: "It is normal that Golkar should want to see him removed because they backed Mr Amien in 1999 despite his small party." Some legislators in Ms Megawati's Indonesian Democratic Party-Struggle (PDI-P) also appeared to back the move.

Political analysts said this was because Mr Amien was seen as the leading figure behind a proposed constitutional amendment that would lead to the adoption of a direct presidential election system.

The PDI-P opposes the change despite its success in the 1999 general election, claiming Indonesians are not ready for it. The assembly is scheduled to decide on the amendment next month.

Mr Amien's support for a direct race is possibly based on his optimism that he could be the strongest contender.

Surveys have shown that his image has improved since last year when it took a beating because of his involvement in the impasse that led to the impeachment of former president Abdurrahman Wahid.

A survey by the International Foundation for Election Systems showed that the level of public satisfaction with Mr Amien's performance has doubled to 43 per cent from last year.

Although he still trails Ms Megawati (53 per cent) and Vice- President Hamzah Haz (51 per cent), many say he has the capacity and the opportunity to improve his standing.

PAN legislator Alvin Lie said: "We still have two years to improve, although we understand that incumbents usually have more privilege to win." Observers also said that Mr Amien had been working to shed his image as a right-wing Islamist, the result of his links with some hard-line politicians.

He has taken pains to present himself to the public as a modern politician, a pluralist and an ideal leader.

His personal website is updated constantly and he is the only major leader to have expressed willingness to take part in a presidential debate with other contenders.

Said a Jakarta-based political consultant: "The others realise that when it comes to free-for-all fight, they'll probably lose to Amien."

Corruption/collusion/nepotism

Audit agency should be empowered: Activists

Jakarta Post - July 19, 2002

Bambang Nurbianto, Jakarta -- Anti-corruption activists say widespread corruption in procurements of goods and services in most units of the city administration cannot be stopped due to the alleged involvement of the City Audit Agency (Bawasda).

They say officials at the agency are not obliged to disclose their findings on irregularities on certain procurements. Therefore, according to the activists, they often compromise with officials of the working units over their findings.

Chairman of Indonesian Corruption Watch (ICW) Teten Masduki said on Thursday that empowering the agency could be the starting point to end corruption.

"The City Audit Agency should be independent and not be a sub- ordinate of the governor. Its members should be elected by the City Council, not be appointed by the governor," Teten told The Jakarta Post.

Teten was commenting on corruption in the procurement of goods and services in the city administration, where the value of corrupted funds could amount to as much as 35 percent of the total allocated funds.

Procurement in the city administration involves a large amount of money. It is estimated to account for Rp 2.2 trillion of the city's Rp 5.7 trillion routine spending in 2002.

Teten also stressed that the findings of irregularities by the City Audit Agency needed to be made transparent. He said the agency should be obliged to announce their findings to the public.

Besides empowering the auditing agency, the city administration should improve its bureaucratic system, which remains vulnerable to corruption.

Marco Kusumawijaya, an urban observer, shared Teten's opinion, saying the city administration's current internal auditing was part of the problem, because he alleged that most of the auditors were corrupt.

"As a taxpayer, I am disappointed that my money is badly spent by officials. Therefore, the auditing process should be improved by inviting people who are credible and possess some integrity to work at the audit agency," he told the Post.

He also said the administration should involve the public as taxpayers should also help supervise the procurement of goods and services, by inviting their representatives to become members of the tender committee.

He said that in many countries, taxpayers play a significant role in controlling government spending and complain to the government if the money is spent improperly.

"I think we should encourage public participation in controlling the government's spending, because if it works well, it will be a significant move against corruption," said Marco, who is a gubernatorial candidate.

Corruption still name of game in Jakarta

Jakarta Post - July 18, 2002

Bambang Nurbianto, Jakarta -- Collusion and corruption are still rampant in procurements of goods and services in nearly all units of the city administration.

A number of executives of goods and services suppliers to the city government said that collusion and corruption could take place both when firms were directly appointed to take charge of projects and when projects were put out to tender.

Because of such illegal practices, only around 50 percent of the total allocated funds was spent on procuring goods and services while the other 50 percent was embezzled by suppliers and the officials involved in the tender or direct appointment process.

"The officials involved in the procurement process can receive up to 35 percent of the total allocated funds," a director of a supply company, who spoke on condition of anonymity, told The Jakarta Post on Wednesday.

The source said the officials who usually took a cut included project leaders, members of tender committees (at least five persons), members of supervisory committees (at least five persons), and the heads of city government units.

He cited as an example a situation where the funds allocated for procuring equipment were Rp 100 million (US$11,000). Only Rp 50 million of this money would actually be used to buy the equipment while between Rp 35 million and Rp 40 million would go into the pockets of the officials involved. The rest would go to the supplier as an additional sweetener.

As the 2002 city budget reaches Rp 9.3 trillion, the goods and services procurement field involves a major amount of money. According to the source, the winners of tender competitions have usually already been decided on before the process begins.

Members of the tender committee or project leaders usually had set up their own men as the winners of the tender before the bidding even began. They also normally had already reached an agreement with their partners about the percentage of the allocated funds that each would receive.

The percentages received by project leaders or members of a tender committee ranged from 10 percent to 15 percent of the total funds allocated for the procurement. The money was usually given in cash through a "mediator" after the winning company had been decided.

The source said that not all the money went to the front-line officials as there were still the members of the supervisory committee, city government unit heads and other officials who also received a slice of the procurement pie. In order to give the impression that the tender process had complied with the rules, the "winning candidate" would normally seek six or seven front companies to take part in the bidding process. Those companies, however, would be aware all along that they were not going to win the tender.

"Such companies are happy if they receive Rp 200,000 each from the winning company in a case where only a small project is involved," said an executive of another supplier who is usually to be found hanging around outside City Hall on Jl. Medan Merdeka Selatan.

Neither is it difficult to find such front companies as dozens of their owners are always to be seen hanging around the City Hall's post office everyday.

Although they are legal, they are not like normal companies. These companies are, in fact, one-man shows with the owner acting both as director and secretary. Such companies usually have no permanent office while all documents and assets of the companies are kept in the owners' bags, which are taken everywhere they go for business.

The second source also said that such illegal practices did not only take place in procurements but also in other projects. And it was not only the city administration that was affected but central government departments as well.

Meanwhile, the city administration's Procurement and Storage Department director, Hamdi, denied that such illegal practices were still rampant in city procurements.

"I don't think this can happen given that all the processes are transparent. A tender involves many parties, including the supervisory committee. And the tenders are also announced in the newspapers," Hamdi said.

Hamdi is right to say that tenders are announced in newspapers, but only in carefully selected ones, namely those with small circulations. As an example, a project worth Rp 9 billion for fencing in the National Monument (Monas) park was only announced in the Sentana newspaper, which is unheard of by most Jakartans.

Arms trade thrives on corruption and lax patrols

Straits Times - July 18, 2002

Marianne Kearney, Jakarta -- Inadequate naval patrolling and officials who can be paid off to turn a blind eye are the weak links enabling a thriving weapons trade through which Thai middlemen supply hundreds of guns, grenade and rocket propellers to the Aceh rebels.

Residents who live along the extensive coastline of the northern Indonesian province frequently witness small shipments of weapons destined for either the separatist Free Aceh Movement (GAM) or other criminal gangs.

"There are lots of guns brought in, especially at night," said Mr Hasan who lives in a small coastal town in East Aceh. The weapons are usually transported via small fishing boats, according to him.

The GAM rebels frequently brandish imported weapons such as AK- 47s and M-16s but they also possess many locally made guns, he added. In West Aceh too, residents say they hear of fishing boats making night visits to drop off weapons along the sparsely- populated coast.

Neither the military nor the navy is prepared to say how many weapons are smuggled into Aceh. Over the past year, however, the military says it has captured over 500 weapons, many of which are foreign-made.

Major-General Zainal, a spokesman for military operations in North Aceh, said that among 317 standard rifles captured or found in raids in the last year, 75 were AK 47s and 31 were M-16s, and from 242 captured pistols, tens were foreign made.

According to reports from Thailand, police in the southern Satun province said two suspects were caught with a cache of weapons -- which included 68 AK-47s, five handgun kits and hundreds of bullets -- and confessed that the arms were destined for a buyer in Aceh.

Indonesia's over-stretched navy, which has just five ships to patrol the Malacca Straits and the North and West Aceh coastline, has failed to stamp out the lively smuggling trade.

First Admiral Sugem Waloyo, the naval spokesman, said it was virtually impossible for the navy to track the smugglers with their tiny force. "Even if we had 20 ships or more it would not be easy to defend that coastline," he added. The navy tries to patrol the North Sumatra and North Aceh coastline, which faces the Malacca Straits, but many other areas such as the beaches of West Aceh are under-patrolled, he admitted.

The smugglers, he pointed out, use small fishing boats which are fast and not easily detected by the patrol boats. And, according to local aid workers, smuggling is easy enough because the military or police officials encountered at road checkpoints can be bribed.

A Western security analyst, however, said he suspected much of GAM's weapons were obtained from the Indonesian security forces rather than from international suppliers.

They can be easily bought, he said, and being locally-made are better suited to the ammunition, most of which is sourced within Indonesia. "It is better to have a commonality of weapons and so then you don't have to retrain your troops on different weapons," he remarked.

The underpaid military and police were often quite willing to sell their weapons to the rebels or else to criminal gangs, he added.

A GAM source claimed GAM preferred to buy its weapons from Java or Sumatra rather than Thailand, saying the price for an Indonesian-made rifle at 20 million rupiah was cheaper than an AK-47 smuggled via Thailand. "We buy our guns from whoever, wherever the price is cheap. But at the moment the best market is in Java," said the source.

The black market price of 20 million rupiah was still 10 times more than the price the military pays to buy the same weapon from the local weapons manufacturer.

But the GAM source also admitted that he did have a contact in Thailand who had claimed that Monday's arms cache was in fact destined for the Tamil Tigers.

Local & community issues

Protesters decry council, show support for mayor

Jakarta Post - July 16, 2002

Ainur R. Sophiaan, Surabaya -- Some 300 people rallied in front of the Surabaya legislative council on Monday, claiming its decision to dismiss the city's mayor last week was illegal.

The protesters, calling themselves the National Generation Forum, urged the council to lift its motion against Surabaya mayor Bambang Dwi Hartono, otherwise it would have to be dissolved.

"We appeal to Basuki to annul the decision, as it is against the public's aspirations," said Amari, the field coordinator for the forum. He was referring to the council's speaker M. Basuki.

Protesters wanting to seek out Basuki were unable to get into the council building. A security cordon of policemen blocked their way but no clashes were reported.

The council's plenary meeting last week decided to dismiss Bambang although he took over the post as mayor from Sunarto Sumoprawiro just a month ago. The councillors took the measure after Bambang failed to attend the session held to hear his response to their demand for a review of his budget accountability speech on June 13.

However protesters argued on Monday that the council's decree No. 2/2002 dismissing the Surabaya mayor was illegal. They said the 2001 city budget, for which Bambang was held accountable, was drawn up by his predecessor, Sunarto.

Councillors dismissed Sunarto on June 10 because of his fragile health condition. Bambang who was the deputy mayor took over the post but had to deliver Sunarto's accountability speech three days later.

The mayor hails from the Indonesian Democratic Party of Struggle (PDI Perjuangan), as was council speaker Basuki.

But PDI Perjuangan has discharged Basuki as the head of the party's Surabaya office, citing moral violations. The council speaker is known to be Bambang's political rival.

Amari said the forum was demanding the council's dismissal instead, claiming its members failed to take into account the public's aspirations.

Constitutional law expert at Airlangga University Harjono MCL agreed on allegations that the council's decision was illegitimate.

He said the dismissal of Bambang had little to do with his response to the rejected budget speech, but more with his failure to show up at the plenary meeting.

Council deputy speaker Herman Rival said earlier that Bambang was discharged for his contempt of the legislature. Councillors who elected Bambang resented his absence, viewing such an attitude as arrogant and disrespectful.

Support behind the incumbent mayor also appeared on the streets. About 200 people carrying a 300 meter-long banner around Bambang's office in Surya Park, asked passersby to support the mayor by signing the banner.

Bambang continues to work as mayor until the council's decision gets approved by the central government.

The city administration secretary Alisjahbana said Bambang's staff was working as usual. "We have nothing to do with the council's motion. Our mayor is still Pak Bambang," he said.

Human rights/law

UN rapporteur says Indonesia's judiciary in serious trouble

Jakarta Post - July 18, 2002

Berni K. Moestafa, Jakarta -- On his third day of his mission to investigate the independence of Indonesia's judiciary, a United Nations legal expert said on Wednesday that it had serious problems.

UN special rapporteur on the independence of judges and lawyers Dato' Param Cumaraswamy said his impression stemmed from the frequent corruption reports in the local media.

"I think there are serious problems in the Indonesian judicial system," he told reporters after meeting Minister of Foreign Affairs Hassan Wirayuda at his office.

"So this is why I am trying to understand the situation in a clearer and more detailed manner before I make my recommendations."

Cumaraswamy arrived here on Monday on a ten-day mission to probe the country's judicial system, including the state of the rule of law. At the end of his mission he plans to make recommendations to the government on ways to improve its judiciary.

Ministry of Foreign Affairs spokesman Marty M. Natalegawa said the government invited Cumaraswamy. Yet the initiative had come from the UN.

He said the invitation came after the UN had asked Indonesia for permission to send its rapporteur here, indicating the UN's concern over what was seen as prevalent legal uncertainties.

"The foreign affairs minister emphasized that the rule of law and upholding human rights are the main pillars of our reform toward a democracy," Marty said of the meeting with Cumaraswamy.

However analysts have said the government's political will for legal reform is nil, or weak at best. Political parties are seen to benefit from this situation, raking in public funds to support their campaigns.

Corruption has worsened over the past four years since the fall of president Soeharto triggered a general collapse of law and order.

Foreign interest in Indonesia's judiciary is rising in the wake of questionable verdicts harmful to foreign investors.

The latest case was the bankruptcy verdict issued against Canadian based insurance firm PT Asuransi Jiwa Manulife by the Commercial Court, which the Supreme Court later overturned.

Cumaraswamy said he expected to hear "a lot of examples" of dubious court cases, which might include the Manulife case.

He also wanted to discuss with the authorities the progress of the ongoing trial of human rights abuses committed in East Timor in 1999. As yet, no one has been convicted.

Marty said the government was hoping Cumaraswamy would gain a comprehensive view of the country's judiciary.

"Oversimplification is often the problem, so we want him to come here and see things in a local context." Cumaraswamy is a Malaysian lawyer who has been a UN rapporteur since 1994. He met several Supreme Court judges on Monday and will meet the attorney general and other senior officials.

Suharto's children are still very well protected

Straits Times - July 16, 2002

Robert Go, Jakarta -- Former president Suharto's children enjoy a measure of protection from the establishment even today, analysts said after prosecutors pressed for a lighter sentence for murder suspect Tommy Suharto.

Prosecutors yesterday demanded a 15-year jail term, instead of the death penalty for Mr Suharto's youngest son who allegedly ordered the assassination of a Supreme Court judge.

The lenient sentence recommendation, analysts said, shows that the Suhartos still exercise a formidable web of influence that extends through Indonesia's military, judiciary, business community and political elite.

The latest expose on the Suharto family's alleged wrongdoings shed some light on the extent of this influence.

Reports yesterday alleged that Ms Siti Hardiyanti "Tutut" Rukmana -- Mr Suharto's eldest daughter -- allegedly brokered arms deals for the military and bumped up the prices Indonesia had to pay.

The Jakarta Post said that during the 1990s, Ms Tutut and her siblings made "handsome profits" as the state bought British Hawk jets and Scorpion tanks, and second-hand German battleships.

Such reports on the family's alleged wrongdoings would have been unthinkable during Suharto's 32-year rule, but they now dominate political discussions in Indonesia.

Mr Kusnanto Anggoro of the Centre for Strategic and International Studies said: "Exposures of past crimes, by the Suharto family or others, are necessary if this country wants to reform itself." While it is now acceptable to talk about their misdeeds, it is also clear that the family can still protect its own.

In their recommendation for a light punishment against Tommy, the government's prosecutors argued that although he is guilty of masterminding a murder, owned illegal firearms, and fled from justice for a year, his good manners, his age (40) and his two children necessitated compassion from the court.

University of Indonesia's Mr Arbi Sanit said: "Many prominent figures here feel that they owe the Suhartos. The old man is widely respected, and his kids capitalise on that loyalty for their own protection. Generals owed their careers to Suharto. Businesses couldn't exist without a family member taking a cut. Politicians couldn't stay in power without the father's blessings."

Tommy himself claimed that the police agreed to hide him while he was a fugitive, and that the high-profile manhunt was a sham.

His siblings have been questioned over their past shady business practices, but none has been indicted.

Mr Kusnanto argued the credibility of the current government and the country's reform process are at stake.

He said: "Indonesia needs symbols -- to be tried and prosecuted. Tommy and the rest of the Suharto family are one such key symbol. If this government fails to properly and credibly prosecute, it will suffer the consequences.

"At first, maybe foreigners will complain. But later on, the Indonesian people themselves might voice their disappointments. And that could be trouble."

Focus on Jakarta

Jakarta governor sidesteps blame

Straits Times - July 20, 2002

Jakarta -- Governor Sutiyoso tried to sidestep blame for his administration's handling of Jakarta's problems by blaming poor public discipline in his accountability speech.

He said on Thursday that he could not improve security due to lack of funds and poor public understanding of the law. For example, the transportation system was due to public lack of discipline and large number of cars.

Pitching for a second office term, he said: "With the complexity of the problems and the fact that the city is still facing an economic crisis ... a five-year term is not enough to solve the problems."

Transportation crisis forces capital to seek solutions

Straits Times - July 19, 2002

Robert Go, Jakarta -- Facing a meltdown in its transportation system, the Jakarta government now dreams of a high-speed subway, elevated trains and modern buses to efficiently move its 12 million inhabitants.

Experts conducting a S$15-million study hope to ease the severe gridlock that often turns a 5-km trip into a half-hour crawl.

They are due to issue a transportation-system master plan next June and warn that Jakarta could see debilitating traffic jams within a few years unless officials act now.

Mr Tomokazu Wachi, a consultant with the Japan International Cooperation Agency (Jica), which is helping to fund the study, said: "The problem is severe. It is already disruptive to common everyday activities and very frustrating."

The experts acknowledged that the city's transportation problems have become so severe that it might be nearly impossible, in terms of cost alone, to implement projects to improve the quality of life here.

Just how bad is the transportation problem in the capital now? Only 5,000 buses -- half the 10,000 required to give adequate service -- ply the city's roads, forcing passengers to cram onto overcrowded, non-airconditioned vehicles.

The number of trains connecting Jakarta to its suburbs has remained the same for the past decade or so, but passenger demand has increased by 20 per cent during the past five years.

Among the options the study team is considering are a subway system, elevated trains, hub terminals connecting commuter rail to the city trains and buses, kilometres of additional roads and highways, and special road lanes for public-transit vehicles.

Many of these projects, however, are likely to remain on paper given Indonesia's tight financial position, the dense level of development within the city and the high costs involved.

Mr Wachi said: "MRT and other projects would be prohibitively expensive. So we also think up cheaper, more implementable options." For example, beginning in December, Jakarta is planning to reserve one lane on major roads for buses and force passengers to board only at selected areas near pedestrian bridges.

Currently, buses and minibuses stop and pick up passengers wherever they want, contributing to traffic jams especially within Jakarta's business district.

"For cheaper options to work, the people have to change their habits, transport operators have to obey regulations, and the authorities have to enforce the laws. I'm not sure that's realistic here," the Jica consultant said.

Problems may be too big to solve

Problems:

• No footpaths, pedestrian bridges and traffic lights.
• 5,000 buses where 10,000 are needed. Also, buses are badly maintained and pollute the city.
• Trains are overcrowded and do not follow schedules.
• Millions of cars and motorcycles clog up roads, and people ignore traffic rules without fear of fines.

Potential solutions:

• MRT system, underground or elevated, to move millions.
• Modern, well-maintained buses that stop only in designated areas.
• Additional roads and highways.

Why solutions may not work:

• MRT system and terminals may be too expensive to build.
• Jakarta is already densely developed and may not have room for a mass-transit system.
• Cheaper options may require residents to break bad habits and obey rules.

Thousands protest against Sutiyoso

Jakarta Post - July 19, 2002

Muninggar Sri Saraswati, Jakarta -- Thousands of people from all walks of life, from becak (pedicab) drivers and street vendors to bankers and stock exchange brokers, staged rallies in different parts of the city to object to Governor Sutiyoso's accountability speech, which was presented before the City Council on Thursday.

They cited Sutiyoso's poor performance during his five-year term and voiced their objection to the nomination of Sutiyoso as a gubernatorial candidate for the next one.

The demonstrations were staged mainly at the Council building on Jl. Kebon Sirih, Central Jakarta, which was tightly guarded, causing traffic jams in the area for hours.

Sutiyoso apparently did not let the rallies bother him as he was enjoying good time with Miss Universe 2002 Oxana Fedorova at the City Hall, located behind the Council building.

Sutiyoso smiled a lot while dancing poco-poco (a traditional dance) with Oxana and other guests. Sutiyoso, who had to look upward to view the face of the 180-centimeter-tall Russian celebrity, sang in English during the 45-minute event.

Protesters in front of the Council building included those from the Betawi (native Jakartans) Students Forum and the Urban Poor Consortium, as well as members and supporters of the Indonesian Democratic Party of Struggle (PDI Perjuangan).

"He does not deserve to be governor -- he is our enemy," said a protester from the Victims of July 27, 1996 Tragedy Forum. Sutiyoso, who was then Jakarta military commander, is implicated in the bloody attack on the party headquarters on July 27, 1996, which claimed five lives and injured hundreds of others.

Interestingly, dozens of professionals staged a similar rally outside the Jakarta Stock Exchange (JSX) building on Jl. Jend. Sudirman, Central Jakarta.

"As professionals, we're not ignorant of this matter. We judge him by his performance and he is not good enough," Aji Barata of the Indonesian Professional Society (MPI) said.

"You see, he can't even guarantee our security," he said, referring to the JSX bombing two years ago and the currently high level of crime in the city.

MPI also called for a direct gubernatorial election. Professionals here rarely participate in demonstrations. JSX professionals took a stand in 1999 to object to the presidential candidacy of B.J. Habibie.

News & issues

Gutteres meets Laskar Jihad commander

Tempo - July 19, 2002

Retno Sulistyowati, Jakarta -- Eurico Gutteres, former commander of East-Timorese Pro-Integration Fighters, came to National Police headquarters (HQ) in Jakarta on Friday (19/7) to meet with Laskar Jihad commander Jafar Umar Thalib.

Jafar Umar has been detained at the National Police HQ detention center for allegedly provoking an attack on a village in Ambon, Maluku, sometime ago.

"I just want to show my support for my friend," Gutteres said after meeting with Jafar Umar.

According to Gutteres, he did not talk much with Jafar Umar. "I just want him not to feel guilty and regret what has happened," Gutteres said.

According to Gutteres, Jafar Umar was right to fight separatist movements like the South Maluku Republic (RMS) and Maluku Sovereignty Front (FKM). The fight against separatist movements is protected in the 1945 Constitution under article 30, said Gutteres.

Gutteres said that he did not bring special message from anyone or any group to Jafar Umar. "I came here in person. I'm also charged in a case. So, it's unlikely I would bring a special message to Mr. Jafar Umar," stated Gutteres.

A prediction of growing militancy in Indonesia

Radio Australia - July 19, 2002

An Australian defence think-tank says there's a growing risk of Indonesia reverting violently to a military authoritarian government.

The Australian Strategic Policy Institute says that unlike the Suharto regime, such an Indonesian Government might be xenophobic and anti-Australian.

In a report on Australia's defence after September 11, the Institute says there's evidence that al-Qaeda members fleeing Afghanistan have moved to Indonesia and built links with Islamic groups.

The Institute says the war on terror has put more pressure on the government of Megawati Sukarnoputri. The report says polarisation between Islam and the West has increased the appeal of Muslim politics to many Indonesians.

Parents seek quick loans at pawnshops

Jakarta Post - July 15, 2002

Leo Wahyudi S, Jakarta -- With the new school year beginning, parents are facing increased financial demands. Those parents unable to come up with their children's school fees are forced to turn to pawnshops to raise the necessary cash.

As the school year approaches, business at the Pasar Senen Pawnshop in Central Jakarta has been on the rise, with parents lining up at the counters to raise some cash.

Barudi, who lives in Tangerang, said he was pawning his wife's necklace to get some quick cash to pay the school fees for his son, who is beginning elementary school. "I have to pay Rp 1 million. I don't have that kind of money at the moment," he said.

Ninety percent of the items pawned here are jewelry. But there are also electronic goods and computers, as well as a couple of motorcycles and cars.

The pawnshop receives an average of 500 grams of gold jewelry a day. In July, however, this figure has risen sharply to 850 grams.

People who pawn their jewelry receive the cash equivalent of about 88 percent of the estimated value of the item. The estimated value is between 70 percent and 83 percent of the market value of the jewelry.

Despite these lower price, many people have no objections.

"Selling your jewelry here is much safer and it is an easy way to get fast cash," one customer, Lely, said. "Despite the low prices, I think it helps us a lot, especially as we are in need of instant money."

Lely, who used to work at a private bank, said that if you went to the bank for a loan, it would take a month. At the pawn shop the entire process only takes about an hour, with a maximum 14 percent interest for four months. After four months, a customer may extend the agreement.

Heri Kisriyanto, the head of the Pasar Senen Pawnshop, one of 67 pawnshops in Greater Jakarta, told The Jakarta Post that in June the pawnshop disbursed more than Rp 4 billion, compared to Rp 3.858 billion in May. And as of July 11, it had disbursed Rp 1.9 billion for the month. This year, it has disbursed Rp 25.2 billion, while from January to July last year it disbursed Rp 26.7 billion.

According to Heri, an average of 564 customers came to the shop each month this year, or about 18 people a day. Almost half of them (45 percent) are employees at private companies, while the rest are housewives, students, traders, fishermen and farmers.

"They mostly need the money to develop their businesses or to pay school fees," he said. "If a customers does not come to reclaim their goods after four months or to extend the agreement, the pawned items will be sold in auction," he said. About 10 percent of customers fail to reclaim their goods.

One customer, Yustia, who lives on Jl. Gajah Mada in West Jakarta, had come to the pawnshop to reclaim a necklace she had pawned three months ago. "I had to keep a close eye on our family finances and my husband, who is a street vendor, also worked really hard to be able to reclaim the necklace," she said.

Environment

TNI linked to illegal bird trade

Jakarta Post - July 18, 2002

Rita A. Widiadana, Denpasar -- The office of Animal Conservation for Life (KSBK) has reported that some members of the Indonesian Military (TNI) are involved in the transportation of hundreds of protected birds including parrots from Maluku and Papua provinces.

A recent investigation by KSBK disclosed that tens of thousands of parrots had been poached from Maluku and Papua and transported to Java and Bali islands, some with the help of Navy warships.

According to KSBK's video records, hundreds of parrots were seen on board TNI warship Teluk Manado No. 537. A source at KSBK, said the birds were being sent to Java and Bali islands. The recording was made in May 2001.

The video, entitled Fly Without Wings, is the report on the results of an investigation conducted by KSBK on parrot trade between January 2001 and May 2002.

The screening of the video, produced in VCD and VHS formats, is part of the organization's campaign to stop the poaching of parrots and other birds in the wild.

The comprehensive investigation, funded by the Royal Society for Prevention of Cruelty to Animals (RSPCA), disclosed that tens thousands of parrots from Maluku and Papua had been poached cruelly.

The birds are usually trapped with tree gum. After the birds are cleaned, the poachers clamp the birds' necks with branches of the trees. Later on, the feathers of the trapped birds are pulled out to prevent the birds from flying.

Among the poached birds are those categorized as endangered species such as the yellow-crested cockatoo (Cacatua sulphurea) and the red and blue lory (Eos histrio). Each of these endangered birds is sold for between Rp 300,000 (US$33) and Rp 500,000 at local bird markets.

According to the law on Conservation of Natural Resources and the Ecosystem, trading of endangered and protected species is strictly prohibited and those violating the law face a maximum of five years in prison and a fine of Rp 100 million.

I Wayan Wiradnyana, head of KSBK's Bali office, said that trading of parrots was very profitable.

"There are several bird suppliers that regularly deliver a large number of rare birds from Maluku, Nusa Tenggara and Papua to several cities in Java and Bali as well as overseas countries," he said in a statement.

To increase people's awareness of the importance of protecting these rare birds, KSBK's Bali office held a campaign to attract the attention of passersby in Bali by displaying a huge parrot- like balloon in front of the busy Mall Bali on Jl. Diponegoro in downtown Denpasar.

KSBK will also hold a series of campaigns and action plans starting in the middle of July.

A Parrot Tour campaign will be held in several places including Surabaya and Malang in East Java, Yogyakarta, Bogor and Bandung in West Java, Jakarta and Denpasar in Bali, Papua and North Maluku provinces, to show the conditions under which parrots are caught and sold.

Waste treatment plant protested

Jakarta Post - July 16, 2002

Theresia Sufa, Bogor -- Hundreds of residents from Kampung Walahir in Nambo village, Klapa Nunggal district, protested on Monday to demand the closure of a waste treatment plant located in the village. The plant is owned by PT Prasadha Pamunah Limbah Industry.

They residents gathered in front of the plant to demand its closure, saying the odor of the waste posed a danger to both the environment and the health of residents. The villagers said that many of them suffered from breathing and skin problems, and nausea.

Agus Mulyono, the protest coordinator, also demanded the company take steps to resolve the problem of the bad odor, and pay as much as Rp 300 million in compensation to the residents, who have suffered since 2000. Another resident asked for the establishment of a health clinic in the village.

On September 27, 2001, the company signed an agreement promising to stop emitting noxious fumes. But residents charge no action has been taken.

Nemih, 36, a resident, said the foul-smelling fumes were emitted by the plant from 3 a.m. to 8 a.m. "It gives us headaches, we have stomachaches and it is difficult to breath. Sometimes we also vomit," she said.

The president and chief operating officer of the company, Edward A. Corcoran, said the company had planted trees, installed a machine to monitor emissions and installed caps to cover the plant's tanks to try and solve the problem. The company, however, is having trouble covering its waste treatment pond. "It will take one month," Edward said.

He claimed that PT PPLI was the only waste treatment company in the country, and served a national interest. He also said that while the smell cannot be totally disregarded, it was still within "normal" levels and that the plant had secured an environmental impact analysis.

He also said that since it began operating eight years ago, the company had developed many public facilities and provided free medical checkups for residents once a month.

Fishermen protest to Pertamina

Jakarta Post - July 16, 2002

Cilacap -- Hundreds of fishermen in Donan subdistrict here have protested to state oil company Pertamina for allegedly polluting the river from which they making their living.

The fishermen went to the local legislature to seek its support for their fight against Pertamina, which for some time has been dumping waste from its refinery in Cilacap into the Donan river.

"There's been a lot of fish killed due to the pollution. This is costing us our livelihoods," one of the fishermen said, adding that the river water had turned black and turbid.

The legislative council speaker, Fran Lukman, promised to summon Pertamina officials for a dialog with the fishermen.

A spokesman for the oil company, Husni Banser, told The Jakarta Post on Monday that Pertamina had taken measures recommeded by environmental experts to keep the river clean.

"But we will take into consideration the fishermen's complaints," he said.

Health & education

Indonesia relies on NGOs, not government, to fight HIV

Jakarta Post - July 15, 2002

Debbie A. Lubis, Jakarta -- With HIV spreading rapidly in Indonesia, the country cannot expect much from the government but instead many non-governmental organizations and foreign groups are tackling the problems.

The government is moving slowly with its eight-year-old National AIDS Commission (KPA) to prevent the possible emergence of an out-of-control HIV epidemic.

"We are just the coordinating body which addresses inter-sectoral issues. All technicalities lie with related ministries," Naalih Kelsum, KPA senior official told The Jakarta Post on Sunday.

The only department which seems serious in dealing with the spread of HIV is the Ministry of Health, while other ministries play only minor roles.

The Ministry of Social Affairs, for instance, trains health workers not to discriminate against patients with HIV/AIDS. But it stops there.

Also, the Ministry of National Education still is in the planning stages for the inclusion of an HIV/AIDS curriculum for elementary and secondary schools.

Other ministries apparently are doing very little in their efforts to deal with the deadly virus.

Naalih said KPA, established in 1994 through a presidential decree, and put under the office of the coordinating minister for people's welfare, had actually conducted a number of projects through its provincial offices.

One of them is a pilot project on 100 percent condom use in brothels in Merauke regency, Papua.

"We have urged the Merauke administration to make rulings that oblige 100 percent condom usage in brothels. We have asked the pimps, commercial sex workers, security guards and clients to support the program.

"We also plan to conduct another campaign in Batam, Riau, this year," he said. Naalih added that the next big program for KPA would be drafting a bill on protecting people with AIDS. However, the task would not be done any time soon as KPA was still restructuring itself following the disbandment of the office of coordinating minister for people's welfare by former president Abdurrahman Wahid.

"We are now planning to hire a consultant from Ausaid [Australia's official overseas aid agency] to restructure and revitalize our organization to keep up with the current changes," Naalih said.

As KPA is restructuring itself, various NGOs and other societal and independent bodies have conducted various projects such as counseling, HIV tests, community support groups and the importation of antiretroviral drugs.

Among them are the Pelita Ilmu Foundation in Jakarta, the Kerti Praja Foundation in Bali and the HIV/AIDS study center (Pokdisus) established by the University of Indonesia and Cipto Mangunkusumo General Hospital.

Pelita Ilmu, for instance, has been active in providing counseling, community support and blood testing for people in Greater Jakarta. Kerti Praja also provides counseling and blood testing for people in Bali.

Because Indonesia does not yet produce cheap HIV-related drugs, Pokdisus pioneered -- currently still the only one -- the importation of general antiretroviral drugs from India and Thailand.

Pokdisus program manager Kurniawan Rachmadi said his study center also published a practical guide book for doctors and health workers in remote areas to handle HIV/AIDS cases.

KPA's ten national priority programs on the prevention and control of HIV/AIDS:

1. Information, education, communication
2. Prevention
3. Testing and counseling
4. Treatment and care
5. Education and training
6. Research and development
7. Monitoring and evaluation (surveillance)
8. International cooperation
9. Program institutionalization
10. Laws and regulations

Armed forces/Police

ETAN statement on restoration of IMET military training

East Timor Action Network - July 19, 2002

"Yesterday's action by the Senate Appropriations Committee restoring full International Military Education and Training (IMET) for Indonesia sets back the pursuit of justice for East Timor, as well as military reform and democracy in Indonesia. It gives a green light for the Indonesian military (TNI) to continue its escalating use of brutal tactics against civilians, especially in Aceh and West Papua.

"The Indonesian military (TNI) undoubtedly will take the restoration of prestigious US military training as an endorsement of business as usual and as US support for continued abuse of human rights. The Senators who voted to restore full IMET have effectively given US backing to continued gross violations of human rights.

"In the name of the 'war on terrorism,' the Senate committee will only promote the continued terrorization of the Indonesian people by its military.

"We strongly urge the House of Representatives and the full Senate to restore the IMET ban before the final version of the foreign operations appropriations legislation passes.

"We thank Senator Leahy and others on the committee who supported the continued restriction of IMET."

Background

On July 19, 2002, the Senate Committee on Appropriations accepted an amendment by Senators Inouye (D-HI) and Stevens (R-AK) to lift restrictions on International Military Education and Training (IMET) for Indonesia in the Fiscal Year 2003 Foreign Operations Appropriations Bill. Before becoming law, the legislation must pass the full Senate, as well as the House of Representatives Appropriations Committee and the full House. Then any differences between the two bills must be reconciled before the legislation is sent to the President.

Congress first voted to restrict IMET for Indonesia, which brings foreign military officers to the US for training, in response to the November 12, 1991 Santa Cruz massacre of more than 270 civilians in East Timor. All military ties were severed in September 1999 as the Indonesian military and its militia proxies razed East Timor following its pro-independence vote.

Congress first passed the "Leahy conditions" in late 1999 and strengthened them last November. The FY00 through FY02 foreign operations appropriations laws required president to certify that Indonesia had met these conditions before regular IMET and Foreign Military Finance (FMF) weapons sales were restored for Indonesia. Last year, Congress allowed civilians from Indonesia's defense ministry to participate in the Expanded IMET program, which involves course work in such areas as civilian control of the military and human rights. The current Senate bill continues to restrict FMF for Indonesia and places conditions on its restoration.

Indonesia to boost military spending

Radio Australia - July 19, 2002

Indonesia's armed forces will put mothballed equipment back into operation following a funding increase.

The armed forces -- battling a separatist insurgency in Aceh province and religious unrest in Central Sulawesi and the Malukus -- have complained that budget limitations have forced many ships and aircraft out of service.

Armed forces commander, General Endriartono Sutarto, says the supplementary funds approved by a legislative committee will help address that problem.

Reports from Jakarta say that only 30 per cent of the navy's 117 ships and 45 per cent of the air force's 220 planes are operational. General Sutarto did not specify what equipment will come back into service, but agreed that aircraft and ships were needed.

Indonesia's unreformed military

New York Times Editorial - July 17, 2002

American military cooperation with Jakarta, suspended during the Suharto dictatorship over the Indonesian Army's human rights abuses, should not be resumed without strict conditions and careful controls.

Unfortunately, the Bush administration is in a hurry to restore ties with the Indonesian military and seems willing to overlook misconduct in the name of strengthening the war against terrorism. The Senate Appropriations Committee, which is planning to consider the administration's request tomorrow, should block it, as urged by Senator Patrick Leahy and other critics.

Despite the coming of electoral democracy, the Indonesian military remains a law unto itself. Its past crimes remain almost entirely uninvestigated and unpunished. Its current practices in places like Aceh and the Maluku Islands are as brutal as ever. And its extensive business interests make it a major obstacle to needed economic reforms. Nor is it a very promising partner against terror.

Indonesia, the world's most populous Muslim country, is an important battleground in the struggle against terrorism. Traditionally, the variety of Islam practiced there has been moderate and tolerant. In recent years violent extremist groups have emerged, some with foreign connections. For now, these radicals have only a limited following.

The best defense against further radicalization is to encourage the transition to civilian democracy that began with the overthrow of the Suharto regime in 1998. Civic groups such as human rights organizations, local development associations and independent trade unions have played a vital role in building democratic institutions.

The United States needs to strengthen these groups and nudge the government of President Megawati Sukarnoputri away from its current dependence on the armed forces. The administration argues that the proposed training program will also help by teaching young Indonesian officers the importance of democracy and human rights. In the context of real military reform, it might.

Resuming military cooperation under present conditions would instead signal that Washington no longer cares much about the human rights performance of Indonesia's armed forces.

Soeharto clan's past abuses emerge

Jakarta Post - July 15, 2002

The involvement of the Soeharto family in the country's arms procurement business only started in the early 1990s. Nevertheless, in a short time, their reach had quickly spread to various quarters of the military.

In 1993, Soeharto's eldest daughter Siti Hardiyanti "Tutut" Rukmana, under PT Bheering Diant Pramata "helped" procure eight British Hawk-100s for training and 16 Hawk-200 jet fighters with a total contract value of $690 million. In 1994 the TNI came under fire when it bought 39 used ships from Germany for a reported US$1.1 billion compared to the actual market price of only $12 million.

In 1995, Tutut acted as an agent to procure 16 Air Force jets, including 12 Hawk-100s, amounting to $540 million.

The jet's original price was $8 million each but had allegedly been marked up to $30 million each giving her a handsome "profit" of over $350 million for a single transaction.

Tutut's other brokering agency PT Surya Kepanjen won a procuring contract for 50 Army scorpion tanks with a price tag of $2.5 million each. Singapore bought exactly the same type of tank at the same time for only $1 million each -- another $75 million extracted from the state coffers.

Tutut's sister Siti Hutami "Mamiek" Endang Adiningsih and brother Bambang Trihatmodjo also acted as contractors for the Air Force. Mamiek's company PT Dwipangga Sakti Prima was appointed to procure a simulator for a Hercules carrier in 1996 with at a price of $30 million. The real price was reportedly not more than $25 million.

Defense equipment mark-up practices likely to continue

Jakarta Post - July 15, 2002

Tiarma Siboro, Jakarta -- The rampant practice of exorbitant mark-ups will likely continue as a senior defense official responsible for equipment procurement has refused to cut out the role of contractors.

Director General of Defense Equipment Procurement Maj. Gen. Aqlani Masa claimed that contractors were still needed for purchasing defense equipment. "Otherwise, we don't have enough money to pay in cash," he told The Jakarta Post in an interview last Friday.

Aqlani's view was in contrast to those of Maj. Gen. Sudradjat, director general for defense strategy at the Defense Ministry who told the Post last Wednesday that the government must change its procurement policy to prevent the mark-ups.

The current policy dates back to the 1970s and stipulates that all government ministries must use contractors to procure their needs.

Aqlani was also at odds with all chiefs of staff of the military who had urged the government to bypass the contractors and purchase the equipment directly from the manufacturers. During her visit to the Czech Republic last month, President Megawati Soekarnoputri said that mark-up practices in defense equipment purchasing was rampant in the past.

The Indonesian Military (TNI) has been campaigning to double its budget allocation from Rp 9 trillion (US$1 billion) to Rp 18 trillion next year.

"In the future, I suggest the government find out the exact prices of this equipment from the manufacturers. If only the president knew the prices, I'm sure that she would have seen that other contractors incapable of offering exorbitant contract prices," Aqlani said.

Aqlani, however, acknowledged that many irregularities which caused losses perhaps on the billions of dollars did occur in the past.

"I admit that in the past, the military's procurement partners were mostly relatives of the Cendana clique. What could we say about it?," Aqlani said referring to the street name where the former ruler Soeharto and many of his family members live.

He added that not a cent of the misused money went to any military institution. He did not elaborate.

Aqlani admitted that there were rules and regulations pertaining to the procurement process, but those amounted to nothing when, "the TNI was suddenly contacted by the Cendana's, claiming that they would be making themselves available as contractors." Many believed that Soeharto had enriched himself in this way -- some estimate his wealth to be in the tens of billions of dollars -- during his 30-year rule, but efforts to recoup that money legally have come to naught.

A military source told the Post that former US president Bill Clinton was peddling a small squadron of F-16 jets to Soeharto to in 1996, after the Congress cut US military ties with Pakistan which at the time was developing a nuclear project.

"The US offer included insurance coverage and Pak Harto agreed to buy nine F-16s at the price of $8 million each, or equal to one third of the price of Indonesian made CN-235s.

"But suddenly the TNI headquarters received a proposal from the company of Bambang and Tutut's husband Indra Rukmana, offering an insurance scheme for the jet planes. We, of course, became confused since it was impossible to reject it at the time," the source said. The project was canceled due to the human rights violations in the country.

According to the source, the military's outrageous shopping spree was held in the 1990s when Gen. (ret) Eddy Sudrajat and Gen. (ret) Hartono were in charged as Minister of Defense and the Army Chief of Staff respectively.

"At the time, the government set up a team to monitor the projects led by former minister of research and technology B.J. Habibie," the source said.

Members of this team were, among others, Rahardi Ramelan of the National Development Planning (Bappenas) and former Bulog head now on trial in a major graft case, former minister of finance Mar'ie Muhammad, former TNI chief Gen. (ret) Feisal Tanjung and Eddy, the source said.

International solidarity

Acehnese leader calls for solidarity

Green Left Weekly - July 17, 2002

Kathy Fairfax, Sydney -- Husaini Hasan, chairperson of the Government Council of the Free Acheh Movement (MPGAM), told a meeting on July 11 that his people's struggle for a referendum would not be realised without international solidarity. The meeting was organised by Action in Solidarity with Asia and the Pacific (APSN). Hasan has lived in exile in Sweden for many years.

Hasan recounted Aceh's long struggle for independence, first against the Dutch from 1873 until the island was overrun by the Japanese in 1942. "Aceh was included in the Federal Republic of Indonesia in 1949, despite never having been a formal Dutch possession", he explained. The Acehnese people consider Indonesian rule as foreign occupation, Hasan declared.

Since the 1950s, "the Indonesian military has shown its determination to keep Aceh part of Indonesia", noted Hasan.

Hasan said that GAM is determined to continue with talks with the Indonesian government, despite the build-up of Indonesian troops (TNI) in Aceh. About 10 Acehnese are killed by the TNI every day.

However, Hasan added that the talks, which have continued for five years, are dominated by Indonesia. "They make the agenda, while we are weak and our people are being massacred", he said.

International relations

Renewed military aid for Indonesia faces key test

OneWorld US - July 17, 2002

Jim Lobe -- More than 50 human rights groups in Washington D.C. are pressing a key Senate committee to retain tough conditions on military aid to Indonesia which the administration of President George W. Bush sees as an important ally in its "war on terrorism."

The Senate Appropriations Committee is scheduled to vote Thursday on next year's foreign aid bill, legislation that will include any conditions on military training and sales programs for fiscal year 2003, which begins October 1.

The administration wants all current conditions on these programs lifted, but some 57 rights groups have written a letter to Committee members insisting that the Indonesian armed forces (TNI) remain an abusive and corrupt institution that do not warrant any US assistance.

"The 'war on terrorism' should not become a vehicle to support state-sponsored military terror on civilians in Indonesia," according to the letter which said that the TNI's record, especially in Aceh, West Papua, and Maluku, had grown worse over the past year.

"Military restrictions are the primary leverage the US government has over the TNI," according to the letter, which was circulated by the East Timor Action Network and signed by groups such as Global Exchange, the Washington office of the Presbyterian Church, and the US committee for Refugees. "If Congress removes them, the TNI will take this as an endorsement of business-as-usual and nothing will be gained."

Congress began reducing military aid to Indonesia -- particularly its eligibility to send officers to the US International Military Education and Training program -- in the early 1990s as a result of atrocities in East Timor. It cut all military-to- military relations in 1999 after TNI-armed militias devastated the former Portuguese colony when the inhabitants voted for independence in a referendum.

Under current law, Indonesia must meet a number of conditions -- known as the "Leahy Conditions" after the chairman of the Foreign Operations Subcommittee, Pat Leahy -- before aid can be resumed. These include bringing to justice those responsible for the mayhem in East Timor and that civilian authorities exercise control over the TNI.

Administration officials admit that Jakarta has yet to meet these conditions, but they have argued in recent months that Indonesia's status as the world's most populous Muslim nation and strategic location on vital trade and oil routes between the Western Pacific and Indian Oceans make it a critical ally in US efforts to combat terrorism, especially in Southeast Asia.

Pentagon officials, including deputy defense secretary Paul Wolfowitz who served as ambassador to Jakarta when military ties were much closer, have also argued that resuming military aid, sales, and training would open channels to mid- and senior-level TNI officers to persuade them to improve their human rights performance.

But activists insist that such moves risk only encouraging the TNI in its abuses. "For the pressure to be lifted now would give exactly the wrong signal at the wrong time," said Mike Jendrzejczyk of Human Rights Watch in Washington. "The Indonesian military appears to be preparing to escalate its operations in Aceh where there has been no improvement at all."

Aceh, the site of a major natural gas operation run by energy giant ExxonMobil, has become increasingly polarized between rebels fighting for the province's secession and the TNI. Jakarta is currently considering declaring martial law there.

The New York Times echoed the activist position in an editorial Wednesday. "Resuming military cooperation under present conditions would ... signal that Washington no longer cares about the human rights performance of Indonesia's armed forces," the newspaper wrote, adding that the TNI still constitutes a major obstacle to economic reform as well, given its "extensive business interests."

Economy & investment

Bad debtors may benefit from IBRA loan auction

Jakarta Post - July 18, 2002

Dadan Wijaksana, Jakarta -- As the Indonesian Bank Restructuring Agency (IBRA) opened on Wednesday the bidding for its ambitious sale of some Rp 145 trillion (US$16 billion) worth of non- performing bank loans, taxpayers may face a bitter reality that most of the loan assets could be retaken by their old owners at huge discounts off of face value.

Sofjan Wanandi, chairman of the National Economic Recovery Committee (KPEN), criticized IBRA for the lack of commitment in preventing the old debtors from repurchasing the loans.

"The relatively short period provided for a due diligence process on such a huge amount of assets would only make it easier for old owners [original debtors] to buy them back at lucrative discounts," Sofjan told The Jakarta Post recently.

IBRA took over the bad loans from ailing banks and closed the banks during the late 1990s financial crisis. The agency is mandated to restructure the loans and sell them to raise cash to help ease the burden of the government which has some $60 billion in domestic debt as a result of the costly bank bailout program. Taxpayers will have to cover these costs.

Although under the law the original debtors are not allowed to repurchase the loans, IBRA itself has admitted that it would be hard to really prevent them from doing so as they could easily use proxy buyers.

"We're not cops. It's the police who are supposed to do investigations, not us," Mohammad Syahrial, IBRA deputy chairman for the Assets Management Credits (AMC), said when asked whether the agency would conduct an investigation to avoid old debtors from repurchasing the loans.

Citibank economist Anton Gunawan also said that it would be an uphill task to identify old debtors: "It's difficult [for the original debtors] to be traced." When the country's financial system crashed in 1997, most of the country's indebted business groups, rather than repaying their huge debts, were instead widely believed to have transferred huge amounts of the bank's money overseas to private accounts.

Now, under the loan asset sale program, they could be tempted to buy back those loans from the government at huge discounts.

IBRA has said it is expecting the loans to sell for about 20 percent to 30 percent of their face value. Investors are only willing to buy the debt at a large discount due to huge risks involved in buying financial assets here, including a weak bankruptcy law, which makes it hard to force debtors to repay loans.

The loan assets are divided into two groups with assets worth between Rp 5 billion and Rp 50 billion categorized as commercial debts, while those worth more than Rp 50 billion grouped into corporate ones.

IBRA said that more than 200 local and foreign investors have registered to bid for the loan assets, which involve 2,500 credit portfolios consisting of both restructured and unrestructured loans.

The agency said that as of Wednesday's deadline, 203 or 82 percent of 248 investors who had signed a letter of interest had registered to bid. Of those who have registered, 91 are foreign investors. IBRA will select the winning bidders on July 24.

IBRA Chairman Syafruddin Temenggung said the agency would cancel the sale and repackage the loans if bids were too low.

The International Monetary Fund has previously asked IBRA to sell the loans in packages instead of selling them individually. But IBRA argued that no local bidders could afford paying for the loans if they were sold as a package. The launching of the massive sales program is part of the agency's efforts to accelerate its asset sale and debt restructuring program.

Aside from raising cash from the sale, the program is also designed to allow the government to redeem its massive recapitalization bonds held by banks.

Under the plan, the recapitalized banks will be allowed to use the bonds to pay for the loan assets.

IBRA is targeted to recoup at least Rp 7.5 trillion worth of bonds this year. Retiring the bonds will help ease the burden of the state budget in covering the interest of the bonds.

Indonesia's quiet rebirth creates a land of opportunity

Sydney Morning Herald - July 15, 2002

John Garnaut -- Forget luring Allan Jones to 2GB, or his role in rescuing Channel 10 -- John Singleton looks set to realise his most lucrative media deal tomorrow.

Twenty per cent of Indonesian TV station SCTV has been floated and will list on the Jakarta Stock Exchange at lunchtime tomorrow, delivering a 100 per cent return for Singleton's consortium in less just 18 months.

Ironically, SCTV is the Channel 10 of Indonesian broadcasting. An Indonesian graduate from a Melbourne business school read the story of Channel 10's rehabilitation in BRW. On his return home, while the Indonesian economy was in the throes of the East Asian economic crisis, he followed the Australian network's cost- cutting formula and turned an unprofitable station into one of the world's most profitable.

Like Channel 10, SCTV is ranked third for audience share but is now considered to be the best-managed television network. Soap operas about the lives of Jakarta's upwardly mobile, news with reformasi (post-Suharto reform) street credibility and dial-in karaoke have delivered the network a young and affluent audience.

But unlike Channel 10 , SCTV's revenues have grown at an annual compound rate of 45 per cent for the past four years.

Singleton, his advertising company, STW Communications, investment banker Mark Carnegie and partner Eddy Sariaatmadja have spent $40 million building up a half-share in the Indonesian network since November 2000. The float, which dilutes their interest to 40 per cent, has been underwritten and oversubscribed at double the price paid.

Singleton and Carnegie are not the only Australians making a lot of money in Indonesia, if not a lot of news. Since being smashed by the East Asian economic crisis and the fall of former president Suharto in 1998, the country is quietly getting back to business.

Indonesia is unlikely to return to pre-crisis activity soon, but the economy has stabilised. This year, inflation has decelerated, real interest rates have dipped below pre-crisis levels and economic growth has chugged along at about 4 per cent a year.

The rupiah has gained 15 per cent against the US dollar and the Jakarta Stock Exchange is up 40 per cent since November.

With the attention of government and business generally focused elsewhere, few seem to have noticed Indonesia's shift in fortune.

To the extent that Indonesia has made headlines here, the underlying stories remain stubbornly the same as they have for decades: violence, corruption, poverty, general hopelessness.

Singleton says he is "bemused and confused" at Australia's inability to see anything in Indonesia unless it's bad. "For SCTV not to rate one mention in any newspaper? I can't f...ing work that out. If we were going to buy 2UE it would be front page of the Business section, and here we're talking 20 times that size.

"We must be so xenophobic, so insular ..." On the other hand, there's no shortage of genuine bad news in Indonesia. Doing business there is challenging.

Ask Manulife, the Canadian life insurer, about shaking off a bankrupt but well-connected partner in the absence of a functional legal system, or ask Rio Tinto what it's like being held to ransom by newly empowered bupatis (regents) and provincial governors, or ExxonMobil about drilling for gas in the middle of the Acehnese civil war -- and you have to admire businesses that soldier on.

Those that persist have often done surprisingly well. Scores of Australian businesses of all sizes and sectors have successfully navigated Indonesia's economic and political crises.

The most successful operators seem to share strategies. Most have invested heavily in personal relationships. Many have sent top executives to supervise operations directly rather than try to pull strings from Australia. Successful operators have blanket policies against corruption. They train local staff and management, and find ways to bridge the cultural rifts that arise. Most of all, they see themselves as long-term players prepared to persist.

Rob Bridge, Australia's trade commissioner in Jakarta, says there should be no illusions about the challenges involved -- but there are rewards for companies in for the long haul. "A number of companies will tell you that last year was their best year on record," he says.

One such company is Leighton Holdings. The Leighton group (which includes Thiess) employs 4000 workers to construct and manage mines in Kalimantan, provide maintenance services throughout the archipelago and build infrastructure such as a rail line in West Java.

The group's long-standing chief, Wal King, says Leighton's Indonesian operations have been an unheralded success. In his experience, Indonesia has been "quiet and peaceful" and he believes the Australian media has been blinded by isolated "hot spots".

"To represent on TV a building burning down in Ambon as a story of what's going on across Indonesia is a gross misrepresentation of the issues," he says.

Leighton's biggest challenge has been sourcing skilled labour. On the expatriate side, Indonesian language skills are now mandatory. On the Indonesian side, the challenge has been answered by establishing the Balikpapan training centre in Kalimantan, where 200 apprentices will be accredited to Australian standards each year.

"Whereas in Australia there's a pool of skilled labour available," says Thiess managing director Roger Trundle, "in Indonesia we've had to create that pool ourselves." Business is good at the small end of town, too.

Tim Hakfoort worked for a Queensland company until he found himself spending more time on projects in Indonesia than home. In 1996, he set up his own firm in Jakarta, NTS Lighting.

The timing of his move was "pretty ordinary", as the Asian crisis hit before he could pull the plastic wrapping from the office chairs. "We kept our head above water and hoped things would turn around," he says. Last year they did.

"Since about September last year the building industry has dramatically improved ... I can think of four big shopping malls being built in Jakarta at the moment. Starbucks have opened a store, and I hear they're opening 15 or 16 across Indonesia over the next few years. We're tendering for the lighting jobs."

He attributes his success to persistence and being aware of cultural difference. "You don't have to alter your life dramatically, but as long as you're sensitive to Indonesian ways of life, their religion ... as long as you're sensitive to what is important to them you won't have a problem."

What's the worst cultural offence? "If it doesn't go your way, you just can't go fly off the handle ... It's not that they lose face, it's that you do."

Ground Consolidation is run by Ian Yates from Wyong. The company is skilled in injecting polyurethane to "stabilise bad ground and stop water coming into tunnels", but not so skilled in choosing consultants to help pry open the Indonesian market.

But Yates finally teamed up with an Indonesian engineer and secured a half million dollar contract to work on a hydropower tunnel near Medan, North Sumatra.

He says he had to adjust his style of dealing to succeed: "I think Aussies go in there boots and all -- or I do anyway -- and think that they should do it our way. But it just doesn't work.

"But once we took the cultural clash out of it we could just focus on the job we had to do: stabilise the ground and stop the water." Did corruption ever rear its head? "I guessed it was going to happen, from the rumours and what I've heard. I laid my cards on the table at the start, and not once has anybody asked me or my company to do that sort of practice. Not once have I even be asked."

Mining - Indonesia's wasted opportunity

Far Eastern Economic Review - July 18, 2002

John McBeth, Jakarta -- His office overlooking Jakarta's central business district, the shirt-sleeved boss of a Western mining company gestures to a graph on his computer screen. It looks very much like the outline of Switzerland's Matterhorn, the right rock-face plunging precipitously onto a flat plain about the year 2005. That, declares the executive, is how his research sees the future of Indonesia's gold bullion industry, with three producing mines due to close in the next two to three years.

Leave aside mining giants Freeport Indonesia and Newmont, whose gold from the Grasberg and Batu Hijau mines is shipped out mixed with copper concentrate, and the graph could very well be tracing the free fall of the whole mining sector. In one of the world's most minerally rich countries, few if any new resources have been found since the 1980s. Worse, and almost inconceivably, a worrying combination of decentralization, misguided nationalism, higher taxes and new regulations is doing more to deter investors than attract them.

Ever since the Busang gold scam and the economic crisis sent small exploration companies scrambling for the exits in 1997-98, it has taken an act of sheer bravery to put a foot in Indonesia's door. Buoyed by higher gold prices, Archipelago Resources is one of the few that have. "This is elephant country -- if you want really big prospects, these are the sort of places you come to," says Colin Loosemore, managing director of the Perth-based company that recently bought the properties of Aurora Gold in Central Kalimantan and North Sulawesi.

Loosemore senses times are changing in Indonesia. Anyway, he points out, "our strategy is to buy straw hats in winter." Whether that optimism is justified is another question. Indonesian officials are already wincing over the impact of the controversial court declaration of Manulife Indonesia as bankrupt -- since overturned by the Supreme Court. "That's a bad, bad thing," says Benny Wahju, chairman of the Indonesian Mining Association, referring to a case that has aroused memories in Canada of the skulduggery surrounding the Busang bust in 1996-97.

Officials had hoped time would lay to rest the $5 billion Busang scandal, in which geologists working for Bre-X, a small Canadian company, salted their core samples with alluvial gold, creating the impression of a bonanza that sent its share price through the roof. It was Indonesia's handling of the case, as much as the scam itself and the subsequent economic collapse, which ended funding for the small Canadian and Australian exploration companies that had flocked to Indonesia in search of a mother lode.

The industry itself has been changing as well. Over the past decade, large mining outfits with an eye on the bottom line have found it more cost-effective to take over junior companies and buy up their projects, rather than gambling on grass-roots exploration. But with investors becoming increasingly hard to find, the result has been a lot less exploration. According to PricewaterhouseCoopers, spending on exploration in Indonesia dropped from $160 million in 1996 to $67 million in 2000 and an estimated $22 million last year. This year, according to some industry sources, it could be as low as $4 million. More than 170 exploration projects have either been suspended or withdrawn and rendered inactive over the same period, leaving barely 12 of the 268 contracts of work signed since 1973 still in operation.

Falling investment

There's more bad news. Total investment in the mining industry plunged from $915 million in 2000 to only $413 million last year -- with a similar drop estimated for 2001. Revenue is also heading downhill, peaking at $888 million in 1999 then sliding to $738 million last year. The industry's contribution to the economy also fell last year after topping out at $1.6 billion in 2000.

The reason why Indonesia gets only a 1% share of exploration dollars worldwide is not just political risk. Tax and other costs already put the country well down the list of mining nations that offer gold companies a good deal. Indonesia's rate of return is just 11.2% on current contracts, compared with 18%-19% in competing countries like Australia and Argentina. That margin will widen even further under new tax laws which abolish VAT refunds and double royalties from 2% to 4% of gross sales; in most countries, royalties are only paid on net profits or have been scrapped altogether.

Archipelago's positive outlook therefore seems almost breathtaking, particularly given the problems Aurora Gold had with illegal miners on both its sites. Indeed, it got so bad in North Sulawesi that the company eventually gave up trying to develop its million-ounce Toka Tidung mine. Loosemore insists, however, that those problems are over. Now that they have stripped out the accessible gold, he says most of the wildcat miners have left -- at least for now.

A small handful of other companies, including Canada's Placer Dome, are also continuing to take a quiet punt on Indonesia. But even that tentative look-see -- and the operation of many existing mines -- could come to an abrupt end if the government fails to heed World Bank advice and amend sections of the 1999 Forestry Act that dramatically expand the boundaries of protected forest where open-cut mining is banned.

Scores of contracts are affected by the ban, including the long- established operations of Canada's International Nickel Indonesia in southeast Sulawesi, Newmont's Batu Hijau project in Sumbawa, Newcrest's gold mine in North Maluku and two major coal deposits in Kalimantan owned by BHP and Kaltim Prima Coal (KPC). "Some of these areas of so-called protected forest have no forest at all," says one analyst, pointing to the lack of coordination between the Forestry, Mining and Finance ministries in efforts to kick- start the economy.

Miners also have to contend with the vagaries of decentralization. When Indonesia's new, long-delayed mining bill is finally passed, it will be compatible with the local autonomy law promulgated in January 2001. Under government regulations already introduced that means contracts signed before that date will remain under central government control, while those signed thereafter will be administered through kabupaten, or district governments which have had little or no experience in dealing with complex mining issues.

Impatient over the foot-dragging in Jakarta, some local bodies have literally taken the law into their own hands. South Sumatra and Bangka provinces have both issued their own mining laws. One tin-mining executive calculates the affect of the Bangka regulations would be to impose an $85 million charge just for the right to begin exploration. Drafts are also being prepared by North Maluku province, two districts in East Kalimantan and another two in Papua -- all home to significant deposits of copper, gold, nickel and coal.

Many local governments are also adding on new taxes for such things as street lighting and mine vehicles. In North Sulawesi, local authorities taxed construction materials Newmont used to build a public road at its own expense near its soon-to-be-closed Minahasa gold mine. In East Kalimantan, KPC has found itself with a different problem: It is being sued by the local government for losses incurred due to delays in the divestment of 51% of its shares which the administration wants to acquire.

What concerns companies is the way the draft mining legislation weighs them down with additional social responsibilities, the result of intensive lobbying by community-based groups long ignored by Jakarta. Says one senior executive: "In effect, they're asking us to take the place of the government." Critics are also worried about the loose wording in the bill that tends to undermine the sanctity of contracts and make it difficult for firms to seek recourse in a legal system whose credibility is already in tatters. In Indonesia these days, it is the same old tired story of a government which just keeps on compounding the mistakes of the past in the belief that sooner or later greed will bring Western investors back.