Labour issues

House proposes government permit for worker strikes

Jakarta Post - August 31, 2002

Jakarta -- Legislators are drafting new changes to the long running debate on the labor bill, proposing, among other items, a government permit for worker strikes and a ban to outsource workers under temporary contracts.

The proposed changes are to be debated by the Cabinet on September 4, when the Ministry of Manpower and Transmigration proposes its own revised bill, said Surya Chandra Surapaty of the Golkar faction on Thursday.

"We counted some 40 of these controversial articles," said Chandra, who is a member of House Commission VII in charge of labor affairs.

The House planned to finalize talks during this current session ending September 27, said Chandra, adding "we must get it done." Legislators and the government have extended the deadline numerous times as neither was able to satisfy workers and companies alike.

Stirring heated debate is the workers' right to go on strike, which, over the past few years, has become the favored method of airing grievances, yet has badly damaged local and foreign businesses. The question centers on whether companies must continue paying the salaries of workers on strike as required by the latest draft law.

Based on the conventions of the International Labor Organization (ILO), it is the labor union that must pay the salaries of workers on strike, said another member of Commission VII, Rekso Ageng Herman of the Indonesian Democratic Party for Struggle (PDI Perjuangan). "But the problem is that labor unions here don't have the money to pay workers' salaries." The commission proposed that workers wishing to go on strike must acquire a permit from the Ministry of Manpower, labor dispute settlement bodies, and the companies they work for.

"The workers must give a strong reason why they want a strike and state how long it would last," said Chandra, adding that the management had to pay salaries of workers on government- sanctioned strikes.

The House also is seeking to ban companies from outsourcing workers and limiting the practice to only non-core businesses of a company.

Thus a company that makes shoes cannot hire workers from another company but may do so on products not related with its core business of producing shoes, explained Chandra.

Labor unions have long decried companies subcontracting work to allow the hiring of temporary workers who have fewer rights and are paid less. They also lambasted the legally accepted practice of keeping workers on temporary contract for an extended period of time.

This, they said, allowed companies to keep salaries low and dismiss them faster without proper compensation and regardless of how long they had worked for them.

Workers in the oil and gas industry are often subject to these conditions, which for this industry, however is not regulated in the labor bill but in a separate ministerial decree.

Now, Herman said, legislators would propose that contracts on temporary workers should be limited to temporary jobs as well. "Say, for those who work at a kiosk during the Jakarta Fair," he said referring to the annual event in conjunction with Jakarta's anniversary on June 22 and lasts about one month.

Legislators outlined the proposed changes in a table which will be discussed with the government next week, Chandra said.

A new labor law that is even faintly acceptable to both workers and companies would go a long way to improving the country's investment climate. The absence of new investment is a barrier to generating jobs here, where unemployment in the labor force amounts to some 8 million people.

SBSI demands release of detained activists

Jakarta Post - August 31, 2002

Yuli Tri Suwarni, Bandung -- Hundreds of members of the Indonesian Prosperity Trade Union (SBSI) marched to the West Java provincial legislature compound to demand the local authorities release all detained activists and stay out of industrial disputes.

The demonstrators, from the Cimahi industrial area, entered the compound and were escorted by a score of security personnel ready to respond to any hint of the possible violence that has marred visits in the past.

They called on authorities to avoid using repression when dealing with striking workers, as not only does it go against the reform agenda, but the use of repression would affect the whole nation and democracy.

"We want the authorities to respect the supremacy of the law and to avoid interfering in industrial disputes between workers and employers," said a demonstrator at a free speech forum in the legislative council building.

The demonstrator called on security authorities to release all 31 labor activists who had been detained over the last two weeks.

"The police should not only release detained members of the All- Indonesia Workers Union Federation [FSPSI] but also those from other labor unions," said the demonstrator.

Twenty-one activists were arrested while leading a mass rally last week to protest the two labor bills being deliberated by the House of Representatives and two more were detained in another demonstration on Wednesday. Seven detained activists from FSPSI have been released.

Supardjo, a labor activist for SBSI, is in police custody pending further investigation in line with the beating of a police officer during the violent rally.

Tatang Rochyani, chairman of the local chapter of SBSI, called on the provincial legislative council to be more serious in responding to workers' demands to drop the two labor bills.

"Workers will continue striking until the legislature listens to their aspirations," he said in a meeting with the legislature's Commission A and Commission E for political, security and economic affairs.

He questioned the legislature's commitment to improve the poor labor conditions in the province, saying that the legislature did not understand the two controversial bills.

"The two bills on labor development and protection and on the settlement of industrial disputes have met with opposition from labor unions because they both fail to show the government's obligation of providing constitutional protection for workers.

"The two bills take the employers' side and are discriminative," he said, adding that the contents of the two bills were similar to Law No. 25/1977, which was dropped by the House and the government.

He said the government and the House should bear in mind their constitutional task of providing protection for people, including workers.

Protesters at Malaysian embassy allegedly linked to military

BBC Worldwide Monitoring - August 28, 2002 (abridged)

The group of demonstrators who protested outside the Malaysian embassy in Jakarta yesterday is suspected to have links with Indonesian military forces and armed groups involved in the East Timor massacre three years ago.

Yesterday, some 40 persons claiming to represent radical nationalist group Laskar Merah Putih Red and White Force burnt a Malaysian flag and pulled down the main gates of the Malaysian mission in Jakarta.

A protest letter was later handed to an embassy official, urging that Malaysia stops its "inhumane" caning and fining of illegal workers.

The incident prompted Foreign Affairs Minister Syed Hamid Albar to advise Malaysians against travelling to Indonesia unless it is necessary, until anti-Malaysian sentiment in the republic "cools down".

A small army

According to the Consortium for Indonesian Migrant Workers' Defence (Kopbumi), the Laskar Merah Putih is a nationalist army, which is said to be linked to the Indonesian army.

"Some of them are ex-criminals. Previously, they had been also sent to East Timor during the post-independence clashes," said Kopbumi executive secretary Wahyu Susilo when contacted today.

However, he added that this group is a small one and that it was not working with other groups seeking migrant workers' rights for Indonesians.

Wahyu said it was "not really" strong, but conceded that another incident involving detention of Malaysian tourists in Medan was "political".

Last Friday, 19 Malaysian tourists were detained by Indonesian police for allegedly not having their passports with them at the lobby of a hotel in Lake Toba, Sumatra. They were released after being held for almost six hours.

The two incidents are said to be the outcome of mounting anger over the jailing and whipping of Indonesian illegal immigrants arrested after the implementation of new immigration laws this month.

To date, over 100 Indonesians have been convicted of immigration offences in various states around Malaysia.

[Source: Malaysiakini web site, Petaling Jaya, in English August 27.]

Teachers complain about dismissal

Jakarta Post - August 29, 2002

Jakarta -- Ten representatives of temporarily employed teachers here came to the City Council on Wednesday to complain about the various problems they were facing, including unfair dismissal, low-salaries and other examples of allegedly discriminatory treatment.

Usman Abdali Watik, one of the representatives and a teacher in Senior High School No. 112 in Maruya, West Jakarta, told the council's Commission E, chaired by Warsillah Sutrisno from the National Mandate Party, that his school principal dismissed him for no good reason after he had been working in the same school for seven years.

"I feel that it is unfair that the headmaster fired me by telephone after I had been working there for seven years," said Usman, who received Rp 320,000 per month for teaching 30 hours per week.

Another teacher, Jumali, who worked in Senior Vocational School No. 13 in Tanjung Priok, North Jakarta, for eight years, also complained about his dismissal.

Jumali said that the management did not tell him about his dismissal. "It was only after I happened to be present at a farewell gathering that actually turned out to be for me that I learned that I had been fired," said Jumali, who received Rp 110,000 per month for teaching 18 hours a week.

According to data supplied by the Forum for Indonesian Temporary Teachers (FGHI), there are some 4,000 temporarily-employed teachers in Jakarta.

Australian firm seeks court order to dismiss workers

Radio Australia - August 28, 2002

[The Australian engineering firm Thiess is seeking a court order to sack six hundred workers from its coal mining operation in Indonesia's southern Kalimantan province. Thiess says it's the worst dispute its encountered in the 30 years the company has operated in Indonesia. At its Senakin mine in the remote Kota Baru district, the company says it's run out of patience with the workforce, which has turned down many offers to return to work from a three month strike.]

Presenter/Interviewer: Karon Snowdon Speakers: Bruce Munroe President Director of Thiess Indonesia; Rexon Silaban, vice President of the SBSI union

Snowdon: There are two very different versions to this story -- perhaps even more than normal in an industrial dispute.

Munroe: To me it's a real tradegy. Some of these people who have left have been ten years in the mining industry and probably ten years with Thiess, on and off. So to have lost those skills over an issue as silly as this is a real tragedy.

Siliban: Thiess already for long long years is cheating them, so they're angry.

Snowdon: Thiess says it can't understand why its 11 offers to return to work have been refused. The company says it all started when three workers were warned about sleeping on the job, leading to a sudden walkout three months ago.

The union, the SBSI, says there have been problems for almost a year over the company's undercalculation of overtime and allowances. The workers are demanding backpay and a reduction in 12-hour shifts.

Siliban: That is one of the reason we are angry because it is like forced labour. In that kind of job many accidents have happened and they are angry about that. Why? Because we are tired and we need the rest. But there are many accidents. And then it seems the company isn't listening to them.

Snowdon: Rexon Silaban is the vice President of the union, the SBSI, which translates to mean the Indonesia Prosperity Union. Siliban says some workers live up to 30 kilometres from the mine, and are therefore dependent on company transport to and from work. They have no choice but to work 12 hours because transport is only provided at the end of a shift.

Bruce Munroe is President Director of Thiess in Indonesia

Munroe: I think the version that I understand the union gave to you about an overtime claim is just one that they know won't fly, because that is never something that's been a dispute between Thiess and the union on this site. And that 12 hour shift is one that they actually wanted, we have given them the option of looking at other things but the shifts that they work there are actually their choice.

Snowdon: The union also claims Thiess hires members of Brimob, the mobile police brigades which are not very well liked in Indonesia, who have, the union claims, assaulted workers on a picket line and fired shots as warnings on at least one occasion. Is that true to your knowledge?

Munroe: We certainly have Brimob on site to provide security on the site and it's standard practice in Indonesia that the police will provide assistance. Brimob is part of the police force. Most definitely though they're not there as strike breakers or anything like that. I'm certainly aware of two incidences where there were scuffles between the Brimob and the strikers. Whether there were shots fired, I haven't heard any reports of that.

Snowdon: Union representative Siliban says people were so nervous after the alleged shooting incident some hid in the jungle for three days.

The remote Senakin open cut mine is 45 kilometres from end to end and produces four million tonnes of thermal coal a year. It recently changed hands from an international consortium and is now jointly owned by the local Bumi Resources and one of Indonesia's best connected family businesses -- Bakrie and Brothers. The management contract at 480 million US dollars over five years for two mines in Kalimantan is the biggest contract on the Thiess books.

Theiss has acknowledged the new workforce at Senakin will be smaller and the dispute is now in the hands of the National Industrial Disputes Authority. It rarely, if ever, has found in favour of workers in a dispute and recently upheld the sacking of 172 workers from the second operation in East Kalimantan.

Rexon Siliban believes Thiess is prepared to suffer a period of lost production rather than negotiate.

Siliban: They're so arrogant. Thiess is operating in the worst labour conditions. But when SBSI entered the place, we trained the people so they know their rights and then they're angry. Thiess is already long long years cheating them.

Snowdon: Foreign owned or managed mines in Indonesia have been targeted by the emerging union movement since the fall of Suharto for recruitment and in the drive to improve poor pay and conditions.

Bruce Munroe says Thiess pays well, provides training and has enjoyed excellent relations with unions and workers until now. He blames new industrial muscle for the current conflict.

Munroe: I think the changing face of industrial relations in Indonesia is very much the reason why these strikes are happening. As I said earlier we've lost some very very good people and a lot of it comes back to a lack of understanding I think on how they can actually come to us with grievances. And the way it's being done at the moment doesn't do anyone any good. Because these guys when it's all said and done are simply looking for better conditions for themselves and their families.

Snowdon: Why is it so hard to get better conditions? There's almost a bit of an admission that conditions could be better.

Munroe: Conditions can always be better. I mean, compared to Australia, it would be ludicrous to pretend that they couldn't be better here. But the way to do it is not to try and blackmail companies and investors like us in Indonesia.

Two more labor activists arrested in Bandung

Jakarta Post - August 29, 2002

Yuli Tri Suwarni, Jakarta -- Heavily-armed police in the West Java capital of Bandung have arrested two more labor activists in apparent attempts to suppress the labor movement in the province.

So far, a total of 34 labor activists have been arrested in line with mounting opposition to two labor bills currently being deliberated by the House of Representatives.

Oman and Sayutin, employees of PT Matahari in the Cimahi industrial zone, were arrested for allegedly leading around two hundreds workers during a strike to protest against the labor bills and the violence used against workers in the province.

Witnesses said five car-loads of police, brandishing machine guns, disbursed the 200 laborers as they gathered outside PT Matahari's warehouse compound in Cibaligo, Cimahi, eight kilometers south of the city, early Tuesday morning.

The chairman of the West Java chapter of the National Front for the Struggle of Indonesian Workers (FNPBI), Ety Rostiawati, said on Monday that police had arrested 32 workers for allegedly inciting the workers to confront security officers.

The arrests occurred when thousands of workers from a number of industrial areas in the city marched through the city to demand the provincial legislative council lobby the House of Representatives to reject the bills which were considered to protect business interests.

Later on Tuesday, led by activists of the FNPBI and the Democratic People's Party (PRD), dozens of workers held a rally to condemn the local councillors for their lack of response in helping the arrested workers.

They said the arrest of their friends was part of the government's policy to stop the protests against the bills. They further said that police had no evidence against the arrested workers.

Meanwhile, Adj. Comr. A. Rusman, chief of the city's detectives unit, denied his members had arrested Oman and Sayutin, saying that police had simply arrested a man who was distributing hundreds of pamphlets encouraging workers to stage a rally. "But I forget his name," Rusman said, adding that police were still investigating the "unknown worker".

In response to the laborer's demands, many factories in West Java were currently being guarded by police personnel, Lucky said. "Maybe they [the police] are afraid that our demonstration may turn ugly like last June. No matter what the reason is, it should not be an excuse for them to overreact." As of Wednesday, none of the labor activists had been released.

Protesters topple gate at Malaysian embassy

Jakarta Post - August 27, 2002

Jakarta -- An Indonesian group protesting Kuala Lumpur's decision to whip illegal immigrants toppled the main gate of the Malaysian embassy in Jakarta on Monday, AFP reported.

About 40 demonstrators chanted slogans and set fire to a Malaysian flag in addition to pushing down the gate. Police stopped them from entering the grounds and a small delegation later handed over a protest letter to an embassy official.

The letter called for an end to Malaysia's "inhuman" caning and fining of illegal workers. It demanded the Indonesian government sever diplomatic relations if Malaysia continues to punish Indonesian workers who are trying to return home.

It threatened to open a "Crush Malaysia" (Ganyang Malaysia) front similar to the one which founding president Sukarno employed during his military confrontation with Malaysia in the mid-1960s.

The protesters came from a group calling itself Laskar Merah Putih (the Red and White Militia), after the colours of Indonesia's national flag.

Indonesia's national assembly chairman Amien Rais has criticised Malaysia for what he called the "inhumane" and "insulting" punishment of caning, sparking a rebuke from Kuala Lumpur.

The implementation of the tough new laws followed a July 31 expiry of an amnesty period, which saw the exodus of more than 300,000 illegal migrants. Courts have since sentenced dozens of other workers to jail and caning.

Earlier Monday Malaysian Foreign Minister Syed Hamid Albar urged compatriots to avoid travelling to neighbouring Indonesia because of what he called anger over the new punishments.

Officials angry in private at Kuala Lumpur action

Straits Times - August 27, 2002

Marianne Kearney, Jakarta -- Indonesian business leaders and politicians are privately unhappy with what they see as Malaysia's harsh treatment of illegal foreign workers in the country.

But in public, officials are quick to assure everyone that bilateral ties have not been damaged and have brushed aside suggestions that last week's detention of several Malaysian tourists in Medan was a form of retaliation for Malaysia's jailing, deportation and caning of illegal foreign workers, many of them Indonesians.

Mr Gus Mulyono, the co-chairman of the Malaysia-Indonesia Business Council, said that while business and trade links with Malaysia had not been affected by the issue, many Indonesians were annoyed by the Malaysian government's inflexible attitude.

Under tough new penalties introduced by the authorities in Kuala Lumpur, illegal workers faced a minimum jail sentence of six months and up to six strokes of the cane.

The implementation of the new laws has drawn harsh criticism from the Indonesian media and several politicians, including National Assembly Speaker Amien Rais.

Mr Gus, who also heads the Malaysia committee of Indonesia's Trade and Industry Commission, said: 'When the Malaysians needed them they were really nice to the workers. But now they have finished the Formula 1 track, the airport and other projects they just want to kick them out. "As a human being, and as an Indonesian, I am very disappointed with the attitude."

Yesterday, around 50 demonstrators burnt Malaysian flags and shouted 'Down with Malaysia' outside the Malaysian Embassy in Jakarta. The protesters demanded that Indonesia drop diplomatic ties with Malaysia until it stops implementing its harsh new immigration laws.

But Foreign Affairs Ministry spokesman Marty Natalegawa denied that ties with Malaysia have been damaged. "The Indonesian government will not adopt a revengeful attitude towards Malaysians in Indonesia because we have mutual respect for the laws of each country," he said.

He also rejected suggestions in the Malaysian press that the detention of 19 Malaysians in Medan, Sumatra, last Friday, for allegedly failing to carry their passports with them in their hotel lobby was a sign of public anger towards Malaysian citizens.

"There is no reason to believe that Malays in Indonesia are in any danger or will be threatened by anyone in Indonesia," he said. He added that relations between Indonesia and Malaysia were "robust and strong", and that the two countries were still working on a Memorandum of Understanding to deal with the labour issue.

Malaysia's Consul-General in Medan Muhammad Yusuf Abubakar also said the detention had no connection with the issue of illegal migrants and that it was safe for Malaysians to visit Indonesia.

Separately, the Foreign Affairs Ministry said it was still investigating why the 19 Malaysians -- along with six Singaporeans -- had been detained for several hours last Friday after police raided a hotel on the shores of the picturesque Lake Toba.

Police in Medan denied that they were targeting Malaysian tourists, saying that they were questioning all hotel guests as part of an anti-drug operation.

"So this was not an operation to detain foreign tourists. All the guests had their identity documents checked, and whoever did not carry any proof of identity was under suspicion and was taken to be questioned," said the information officer for Medan police, Mr Amrin Karim.

Foreign firms pulling out due to labour woes

Straits Times - August 25, 2002

Jakarta -- Many foreign manufacturers have shut down or relocated their businesses in Indonesia to other countries due to lingering labour conflicts, Industry and Trade Minister Rini Suwandi has said.

They also did this because of high economic costs resulting from illegal fees, she added during a visit to a textile company in Sukoharjo, Central Java, on Friday. The minister said that there had been fears that labour conflicts could disrupt the delivery of goods for the export market.

Foreign manufacturers are mainly export-oriented companies who must assure their buyers that they can meet delivery targets.

Ms Rini also acknowledged that the global economic slowdown was a factor that caused the companies to shut down their operations because of weaker demand, citing as an example the US shoemaker Nike that had cut down its orders from Indonesia's local factory.

The Korean Chamber of Commerce had earlier warned that more South Korean companies operating here would shut down their operations or relocate to Vietnam or Myanmar, which have better investment climates, if the Indonesian government failed to address the problems hurting their businesses.

Several Korean firms had either shut down or relocated their operations during the past year, leaving some 32,000 workers jobless. More companies are preparing to pull out of Indonesia.

Among the reasons stated for the mass exodus were unfavourable labour policies, an irrational increase in labour wages, labour strikes, low productivity and poor law enforcement.

Indonesia needs foreign investment badly to help push economic growth so that jobs can be created for the large number of unemployed, which according to one estimate is around 40 million.

Chairman of the National Economic Recovery Committee Sofjan Wanandi said the exodus of foreign manufacturers from the country was at the top of the agenda of a new crisis centre.

He said the centre would soon arrange a meeting between foreign investors, labour unions and government officials to help address the problem of labour conflicts and other related issues.

Aceh/West Papua

Priority for Aceh: Saving lives, peaceful settlement

Jakarta Post - August 30, 2002

Rizal Sukma -- After being postponed for almost two weeks from August 5, the government finally issued a "new policy" for Aceh on August 19. The policy, while it continues to stress the relevance of previous "comprehensive policy" to deal with the Aceh problem, has two new, additional elements.

First, it gives the Free Aceh Movement (GAM), an ultimatum to accept the Special Autonomy Law by early December 2002. Moreover, the government maintains that future peace talks will depend upon GAM's acceptance of the law.

Second, if GAM does not conform with the ultimatum by the deadline, the government pledges to intensify its military operations and take "firmer" action in the province. It is also important to note that despite the tough warning, Jakarta has abandoned its previous plan to impose a state of emergency in Aceh, be it military or civil.

However, there is skepticism that the new policy will solve the Aceh problem for two main reasons. First, the new policy, especially the ultimatum to GAM to accept the law by December, is clearly based on flawed logic. While maintaining that it is still open to a negotiated political settlement, the government apparently fails to understand the logic of peace negotiations in resolving a secessionist conflict such as in Aceh.

The conflicting choice between independence (for GAM) and autonomy (for the government) is the core issue in such conflict.

It is predictable that GAM will reject and ignore the ultimatum, because, if GAM does accept the special autonomy law by the deadline, this implies abandonment of the independence demand and then the problem is virtually solved.

The peace talks are meant precisely to resolve the differing position between the government and GAM on the future status of Aceh in relation to Indonesia: autonomy or independence. In other words, for Jakarta acceptance of the law should be the ultimate goal of peace talks, not a precondition for them.

Second, the policy is still based on the assumption that the problem in Aceh can at the end be resolved through military means. This assumption is clearly reflected in Jakarta's threat to intensify military operations in the province should GAM refuse to accept the autonomy law at the end of this year.

In fact, history proves that military means have never succeeded in solving the Aceh problem. The Armed Forces tried to put down the Acehnese rebellion through brutal military operations during the military operation era (DOM) from 1990 to 1998. The military operation, instead of bringing an end to the rebellion, merely resulted in the growing appeal of independence to the Acehnese. Gross violation of human rights by the military during that period drove many to join the secessionist movement.

More importantly, it is difficult to understand what the government means when it insists on "firm" military action against GAM if it fails to meet the December deadline. Does it mean that over these years, especially from early 1999 onward, the government or TNI was not yet "firm" in carrying out its counterinsurgency operation against GAM in Aceh?

Indeed, such a statement begs many questions. The military authorities in Aceh, for example, revealed that security forces killed more than 950 GAM members since May 2001 (Serambi Indonesia, July 31, 2002). TNI forces also managed to kill GAM Commander Teungku Abdullah Syafii earlier this year. Indeed, media reports also suggest that the security apparatus in Aceh has been actively engaged in counterinsurgency operations against GAM. In such circumstances, repeated threats by the government that it will take "firmer" military action raises two areas of speculation.

First, as the threats have already been made repeatedly over the last three years, the latest threat might simply reflect the government's frustration due to its inability to solve the Aceh problem. Second, the threat might also reflect the inability of security forces to carry out a counterinsurgency operation of sorts so that they would have a freer hand in using military might.

Whatever message the government intends to convey through the ultimatum and threat, it seems that peace remains as remote as ever in Aceh. Here, it is important to stress that the peace talks remain the best policy option for both sides.

GAM's acceptance of the special autonomy law as an entry point for further peace talks and negotiations should be seen as progress. The government should capitalize on that and move to reach other agreements and achieve progress on areas that were agreed upon by both sides in Geneva May 2002.

For the next round of peace talks, rather than quarreling on autonomy or independence, both sides should focus on reaching an agreement to an end of hostilities and violence and a monitoring mechanism. At the moment, saving the lives of thousands of Acehnese is more important than any other issue.

Indeed, priority should be given to peace talks. That, however does not mean Jakarta should abandon its right to preserve and maintain law and order in Aceh. The problem here is how to exercise that right.

Professionalism, discipline, improved operational capability in conducting counterinsurgency operations and an appropriate degree of civilian control over the military have become imperative. However, one should not forget that any operation "to win hearts and minds" in Aceh would not bring about any significant result if the government continued to ignore the resolution of human rights cases and the implementation of promises in socioeconomic fields.

The four dimensions of conflict resolution -- peace talks, the maintenance of law and order, human rights trials and social and economic improvements -- should be carried out in tandem.

[Rizal Sukma is the Director of Studies, Centre for Strategic and International Studies, Jakarta.]

New military chief hopes to be hammer of Aceh

Sydney Morning Herald - August 31, 2002

Matthew Moore, Jakarta -- Indonesia's supreme military commander has warned the separatist movement in Indonesia's troubled province of Aceh that he would prefer war to a negotiated settlement to the 26-year-old dispute.

In a series of blunt remarks to the Free Aceh Movement known as GAM, Indonesia's new commander of the armed forces, General Endriartono Sutarto, said GAM were "traitors" who were "betraying Indonesia" and should be attacked.

General Endriartono warned: "We cannot continue with the way things are ... "I am trained for war so I would choose war -- not negotiation -- to end the problems in Aceh but it's not me that makes the decision." General Endriartono appeared frustrated with the military's inability to crush GAM, despite several thousand troops sent to Aceh recently to bolster more than 20,000 soldiers who heavily outnumber the GAM guerillas.

He also expressed annoyance with the Indonesian media, who he said treated GAM members like "heroes". "While Robin Hood robbed from the rich to give to the poor, it was important to realise that what Robin Hood did was wrong because stealing was wrong," he said. Though he did not admit his soldiers were committing human rights abuses in Aceh, he said there had been some instances of "indiscipline".

It was impossible for "100 per cent of all soldiers to respect human rights. I always train soldiers to be professional." Any acts of "indiscipline by soldiers could be blamed on their poor wages and conditions, he said. Some received less than $A1 a day for food.

The military had no option but to continue to supplement its budget through its business interests, General Endriartono said, but he refused to make public audited statements of these activities. The Government recently approved his request for these business operations to continue.

General Endriartono was chosen for the top military job three months ago by President Megawati Sukarnoputri. Aceh is the main issue facing his army.

Last week the Indonesian Government issued GAM with a deadline of December 7 to accept an offer of special autonomy. However, GAM has pledged to continue its fight to become an independent state like East Timor. General Endriartono opposes moves for a referendum on independence to be held in Aceh. East Timor was a mistake, he says.

Ten more die in Aceh war

Jakarta Post - August 30, 2002

Banda Aceh -- Adj. Brig. Syarifuddin was killed by unidentified gunmen and 10 others, presumed to be civilians were killed on Wednesday and Thursday in strife-torn Aceh.

Syarifuddin was on his way from his office to his home in Lhokseumawe, North Aceh, early on Thursday.

Adj. Sr. Comr. D. Achmad, spokesman for the Aceh Provincial Police, said here on Thursday that Syarifuddin died after being shot eight times. His body was recovered in the Mon Geudong area of Lhokseumawe.

Witnesses said he was shot dead by two gunmen on a motorcycle who escaped after firing several other rounds skyward. Syarifuddin was buried in Krueng Mane, Muara Dua Subdistrict in the regency.

Separately, social workers discovered nine bodies in two separate places in the province on Wednesday. Six bodies were discovered in a sawmill in Alue Jambe Village in Nagan Raya Regency and two of the bodies were identified as Muhammad Syam, 42, head of the Ia Memeh Village, and Salam, 42, head of a neighborhood community unit in Ia Memeh.

The social workers from the local chapter of the Red Cross also recovered three other bodies from Agoi Village in Seunagan Timur Subdistrict. Neither side has claimed responsibility for the murders.

Meanwhile, twelve activists from the Democratic Front for Aceh Resistance who were arrested for possession of antigovernment pamphlets, were released on Thursday after reportedly paying Rp 1 million each to the police.

Jakarta to outlaw activists

The Mercury - August 29, 2002

Don Greenlees -- Indonesian police have drawn up plans to outlaw the main Papuan independence organisation in a crackdown on separatism aimed at preventing Papua from becoming a "second East Timor".

Minutes of internal police meetings and documents obtained by The Australian, reveal a strategy to put the Papuan Presidium, the leading civilian proponent of an independent Papua, out of business, possibly by arresting and prosecuting its leaders.

The 60-day operation, known as Adil Matoa, began this month with the aim of identifying separatists or separatist organisations, arresting and prosecuting individuals "committing treason or attacks against the state" and shutting down organisations conducting separatist activities.

According to the minutes of a three-hour meeting on July 5, attended by 16 high-ranking officers of the Papua provincial police, the operation would seek to prosecute Presidium members "according to the law [by obtaining] clear evidence that their activities are towards the illegal separation of Papua from Indonesia".

It warns that police need to take action to stop Papua becoming another East Timor.

The moves to set up surveillance against Papuan political activists and pave the way for prosecutions come amid heightened determination in Jakarta to prevent separatist movements around the country building momentum for their causes.

Analysis by the armed forces intelligence agency has played down the risks posed by the ill-equipped, poorly co-ordinated and relatively inactive armed wing of the Papuan resistance. But according to sources, armed forces intelligence is concerned about the potential for the political wing to build support, particularly overseas.

There are fears that foreign lobbying activities could help change sentiment in countries such as the US and Australia, where governments support continued Indonesian rule based on Jakarta offering local autonomous rule.

Exerting pressure on the civilian political movement is seen as the most effective way of containing the growth of pro- independence activity. An order signed by the Papuan police chief, Made Pastika, on July 17, initiating the operation, states that activities to combat Papuan separatists are to be carried out within the province, elsewhere in Indonesia and abroad.

In this document, targets of the operation are cited as "suspected civilians and community organisations that have a vision and mission oriented towards the separation of Papua from the Indonesian republic and endangering the unity of the nation by violating national law".

It also cites civilians and community organisations that "object to government policy using the cover of violation of human rights [and] violation of indigenous rights" and conduct activities that can "undermine the dignity of the government and state".

Fearing the operation will trigger a round-up of civilian political and human rights activists, a national human rights group wrote to the police chief accusing the police of trying to turn legitimate human rights work into "a cheap issue to clamp down on innocent people".

The letter by the Commission for Missing Persons and Victims of Violence (Kontras) warns the operation will only lead to a repeat of the "crimes against humanity committed in the past, for which the state was never held accountable".

A written reply from police headquarters in Jakarta maintains there is a "strong reason" to run operation Adil Matoa because there is evidence "suspected individuals and community organisations have a mission [and] tried to build public opinion domestically and abroad to unify their vision for an independent Papua".

"We hope that those illegal organisations will disband out of their own conscience," the letter states, in what activists regard as a reference to the Papuan Presidium.

Sweden refuses to prosecute Aceh rebel

Laksamana.Net - August 28, 2002

The Swedish Ambassador to Indonesia Harald Sanberg says his government won't take any legal action against Hassan Tiro, the exiled chief of Indonesia's separatist Free Aceh Movement (GAM), as long as he doesn't break any law in Sweden.

The ambassador made the statement Tuesday after Indonesia's chief security minister Susilo Bambang Yudhoyono said the government would urge Sweden to take legal action against Tiro on the grounds that GAM was responsible for carnage in Aceh.

"We can only take legal action against our citizen, who violates the rules of law in Sweden," Sanberg was quoted as saying by China's Xinhua news agency.

The Indonesian government earlier this month delayed making a decision on whether to impose a state of emergency in Aceh, but said the rebels have until December to accept an autonomy package that came into effect at the beginning of this year or face further crackdowns.

GAM has refused to accept the autonomy deal, which gives the province a greater share of the revenue from its natural resources, but expressed hope that peace talks would be resumed.

Rights activists blame the Indonesian military for most of the bloodshed in Aceh and say certain officers want to prolong the conflict so they can profit from illegal businesses while stationed in the province.

It's no secret that some officers in Aceh get away with rape, torture and murder, and supplement their salaries by selling drugs. Little wonder then that the military is widely despised in staunchly Islamic Aceh.

Sanberg praised the government's efforts to end the conflict in Aceh. "Indonesia's efforts to end the conflict in the Aceh province is [sic] on the right track," he said, adding that Sweden supports a united Indonesia.

GAM has been fighting for independence since 1976, but the government refuses to allow Aceh's 4.1 million people to hold an independence referendum.

Indonesian Defense Forces (TNI) commander General Endriartono Sutarto, who earlier this month said the military was in Aceh for war, not negotiations, on Tuesday said that talks with Tiro have not been ruled out.

"If in fact he still has some say over GAM, and in the effort to settle the Aceh conflict, a dialog with Hassan Tiro would be relevant," he said after attending a limited cabinet meeting.

He stressed that talks would only be held if GAM accepts the special autonomy legislation. "Within that framework, the government will continue discussions with all GAM leaders to pave the way for peace in Aceh."

But he said the government would never accept any proposals or demands for Aceh to secede from Indonesia.

Analysts say Indonesia will continue fighting a never-ending and unwinnable war in Aceh until it puts a stop to military atrocities because the vast majority of the territory's residents support the rebels.

Indonesia, Aceh in war of words, soldier killed

Jakarta Post - August 29, 2002

Jakarta (Agencies) -- The war of words between leaders of the Indonesian government and the Free Aceh Movement (GAM) independence group continued, an Army captain was killed and at least five civilians were injured in the latest clashes in the region, according to military sources.

Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono claimed that the group's leaders in exile in Sweden were ordering acts of violence in Aceh despite earlier promises that they would work toward a negotiated settlement.

"A desire for peace is met with bombs and terror. Will Indonesia give in? No," Susilo told reporters after meeting President Megawati Soekarnoputri in Jakarta as quoted by AP.

Meanwhile, Sofyan Dawod, a spokesman for the rebels, said accusations that his leaders in Sweden were behind the violence were "ludicrous" and "simply laughable." He also accused the government of trying to wreck the peace rocess. "They are doing everything they can to try to prevent the [peace] meetings from taking place, in order that they can continue to kill our people and to continue robbing the wealth from our land," Dawod said in a statement.

Minister of Foreign Affairs Hassan Wirayuda said after installing new consulate generals for Osaka, Sydney and Ho Chi Minh City on Wednesday, that Indonesia had asked Sweden to persuade the leaders of GAM, Hasan Tiro and his deputies to stop the rebellion -- and the threat to the country's unity -- by asking them to seek the best solution to the Aceh conflict.

Sweden has so far supported Indonesia's sovereignty and the implementation of a special autonomy for Aceh as well as Irian Jaya. Hasan Tiro has lived in Sweden for nearly 20 years and according to Susilo is a Swedish citizen.

Wirayuda considered a plan by Susilo to take Hasan Tiro and his colleagues to an international court, sensible, "because the United States has a law which bars its citizens from participating in war in other countries. So, the statement by the coordinating minister is reasonable," he said as quoted by Antara.

At least 12,000 people -- including nearly 900 so far this year -- have been killed since 1976. Most have been civilians. On Tuesday, about 30 rebels ambushed and killed an Indonesian army captain, claimed local military chief Lt. Col. Agus Permana, who added that they had targeted the captain because he led a raid Monday that killed a rebel chief.

Meanwhile, Antara reported that five people, including hree women, were injured in a grenade attack on Alue Brawe village near East Aceh's main town of Langsa on Tuesday, apparently fired by "unknown" attackers.

Pro-independence activists arrested in Aceh

Jakarta Post - August 29, 2002

Banda Aceh -- Security authorities in Aceh have arrested 12 members of the pro-independence Front for Acehnese People's Democratic Resistance.

They were netted in a security operation conducted by a group of security personnel from the Police Mobile Brigade, in Indrajaya, Pidie on August 15, 2002 and so far, none have been released.

Rufriadi, coordinator of the Banda Aceh Legal Aid Institute (LBH) said the activists were arrested when security personnel found antigovernment circulars in the bag of an activist.

"The police should announce to the public why the activists were arrested," he said, citing that the activists' arrest was revealed to local media days after they were captured," he said.

Disagreement over terms of peace talks in Aceh

Radio Australia - August 26, 2002

[Indonesia's troubled province of Aceh may see an escalation in conflict, if the government and separatist rebels fail to agree on conditions for peace talks. The rebel Free Aceh Movement, or GAM, is open to holding talks. But, Jakarta says there'll be no negotiations unless GAM accepts the autonomy package that was introduced late last year.]

Presenter/Interviewer: Kanaha Sabapathy

Speakers: Bakhtiar Abdullah, GAM spokesman based in Stockholm, Sweden; Professor Human Hamid from the Syiah Kuala University in Banda Aceh

Sabapathy: After agreeing to conduct all inclusive talks in May, Jakarta is changing the game plan for talks with the Acehnese rebels scheduled for the latter part of this year. Bakhtiar Abdullah, the spokesperson for the Free Aceh Movement, or GAM based in Sweden, says the may talks mapped out a few important matters.

Bakhtiar: In the agreement last May, we agreed to carry out the process of confidence building and at the same time to go step by step with the road map that had been concluded between the two parties. And after the agreement was signed, they agreed to carry out the next plan of cessation of hostilities and also all- inclusive dialogue to be carried out around this year.

Sabapathy: But all that is now in the balance. Jakarta now wants GAM to accept the NAD, or the Nangoro Aceh Darrusalam autonomy package, first before talks can resume. But GAM, which is prepared to use the autonomy package as a starting point in talks, is not willing to give up its aspirations for independence. At the end of last year Jakarta introduced the NAD to Aceh, under which the province could introduce Sharia laws and would have a greater cut of the income generated from its rich natural resources. But, according to Professor Human Hamid from the Syiah Kuala University in Banda Aceh, these provisions should only be seen as a starting point for further negotiations.

Hamid: He arrived for the people to choose their own leader or leaders, either the governor or the mayor or the head of the district and the fair share of revenue from oil and gas and the authority to manage all other natural resources. Well they got some good measure in that bill but the government should convince the movement first.

Sabapathy: GAM spokesman Bakhtiar Abdullah agrees, saying that a referendum will clarify what exactly the Acehnese want.

Bakhtiar: The NAD law is not what the Acehenese want and this can be determined only through a democratic process. For example it can carry out some kind of reference or plebiscite and if this is what they want then freely without any intimidation by the regime, only then we will know whether that is favour of the NAD law.

Sabapathy: Meanwhile, Jakarta has been making some veiled threat. Chief security minister Susilo Bambang Yudhoyono says if the rebels do not accept the autonomy package the government would take stern measures, including an increase in the number of military personnel or the imposition of civil emergency. Professor Hamid says this is definitely not the way to resolve the problem.

Hamid: If a government is willing to apply a security approach in handling Aceh, I doubt if the government is going to succeed. Because if you look at the history of the movement since 1989, the more the government applied a hard approach the more you will see the system fail.

Sabapathy: The civil war which started in 1976 has claimed over 10,000 lives, mostly civilans caught in the middle. Although a peace accord was signed between the rebels and the government in May 2000, there has been little or no let up in the fighting. This year alone some 845 civilians have died. Only last month the government labelled GAM as a terrorist organisation although human rights group lay the death of innocent civilians on both sides. Mr Bakhtiar however says the terrorist activities are being conducted by the military not GAM.

Bakhtiar: This propaganda is nothing new for us because they have labelled us with so many other labels. But we have made our point clear to the international community and they are the witness today of what's going on in Aceh, because so far we have never carried out any terrorist actions against anybody except well of course in terms of war, soldiers are getting killed. But it's the other way round. It's they who are the terroristic regime, because every time they carry out a military operation, they always retaliate upon the foreigners and civilians. When they do it upon the civilians, these are against all norms of the international standard.

Sabapathy: So where to now for the peace process in Aceh? Despite the impasse, Mr Bakhtiar says GAM hopes the talks will take place.

Bakhtiar: We have to look into our different priorities to find a common denominator whereby we can agree and that's why the reason why we are still holding onto the May agreement and we hope to find there's some kind of solution in the field of secession of hostilities.

Rights vs investment

Radio Australia - August 23, 2002

[What could US oil giant Exxon-Mobil have to do with the deadly conflict in the Indonesian province of Aceh? A group of villagers from Aceh have gone to court in the United States, to sue Exxon- Mobil for complicity with Indonesian security forces in committing human rights abuses. Damien Kingsbury is a Senior Lecturer in International Development Studies at Deakin University, and co-editor of "Indonesia: The Uncertain Transition". In this opinion piece first broadcast on Radio National's Perspective, he explains what's at stake in the Exxon-Mobil case.]

In the United States, 11 villagers from Indonesia's province of Aceh are in court, seeking to sue the giant oil company Exxon- Mobil. Under US law, it's illegal for an American company to sponsor human riots violations in another country.

But the US State Department has tried to intervene in the case, arguing that if the court upholds the villagers' claim it damage US foreign interests. This appeal to 'national interest' over law has so far fallen on deaf judicial ears.

Exxon-Mobil operates the giant Arun liquid natural gas plant on Aceh's east coast, and there is considerable evidence that the company pays the local Indonesian army or TNI battalions for protection. This protection is against guerrillas from the Free Aceh Movement (Gerekan Aceh Merdeka), or GAM.

GAM also claims that Exxon-Mobil encourages the army to use its premises for the interrogation, torture and murder of Acehnese civilians. A mass grave was recently found only metres from a military post at the giant refinery.

The US State Department however, is effectively arguing that the facts of the case are not important. What is important is the ability of Exxon-Mobil to continue to contribute to the Indonesian economy, to show that Indonesia is a safe place to invest and, most importantly, to prop up the military backed government of President Megawati Sukarnoputri.

This is all in return for Indonesia's support of the US-led war on terrorism. As the world's largest Islamic state, and situated at a strategically vital global cross-roads, Indonesia is seen as vital to US strategy.

So important has Aceh become to Indonesia that the US peace negotiator General Anthony Zinni just recently arrived in the province to try to broker a peace deal between the separatists and the government. He said that both sides willingness to talk augured well for a peaceful outcome.

Yet talks have been underway between the Indonesian government and GAM -- the Free Aceh Movement -- for more than a year. And during that time GAM negotiators have been arrested, and violence has escalated.

In May this year, peace talks in Europe went hand in hand with the TNI's killing of the GAM military leader, Abdullah Syafei. Syafei was sent a letter inviting him to peace talks in the local capital Banda Aceh. The path of the letter was used to track and kill him and his pregnant wife.

The problem with talks is that the positions of the two parties are irreconcilable. The Indonesian government insists that Aceh will remain a part of Indonesia, and has granted the province some autonomy. GAM on the other hand, has rejected the autonomy package as imposed and designed to consolidate Javanese control. They insist on an independence referendum, which they believe they will comfortably win.

In the interim, a state of emergency has been declared and Aceh has become a war zone. The TNI has been pouring thousands of troops into the area -- at least 22,000 Indonesian soldiers in Aceh, along with around 18,000 paramilitary police. And no Indonesian conflict would be complete without militias.

There are about 10,000 predominantly Javanese militia operating in Central Aceh, trained and led by the Army's Special Forces, who also trained and led the militias in East Timor.

No-one knows exactly how many have died so far in Aceh's war for independence. The Free Aceh Movement claims some 6,000 were killed last year, and proportionately the same number in 2002.

Twelve alleged Aceh rebels killed since Sunday: military

Agence France Presse - August 27, 2002

Indonesian troops killed five suspected separatist rebels in Aceh province during a raid on a suspected rebel base, a military spokesman said.

The dead were among 12 alleged rebels, including a district commander, whom the military claims to have killed since Sunday.

Major Zaenal Mutaqin, the Aceh military spokesman, said troops found the five unidentified bodies after 98 soldiers attacked a base of the separatist Free Aceh Movement (GAM) in the Raya Baroh region of West Aceh Monday.

Mutaqin said a 30-minute firefight erupted when forces attacked the base which they believed held about 60 rebels. Troops seized an AK-56 rifle and a number of rebel documents, he said. GAM said the victims were civilians.

In a separate incident in South Aceh Monday, troops shot dead Yong Padang, 47, whom they allege was the district GAM commander.

Captain Satria Marmi, who led 11 Indonesian soldiers in the operation, said they shot Padang during a search of Padang Panyang village. He was bathing when he realized his house was surrounded and tried to flee before troops shot him, Marmi said.

Three other suspected rebels died Monday during a joint military-police operation in West Aceh after two paramilitary policemen were wounded during an attack on their post in the Krueng Sabe area, police said.

GAM again said the victims were civilians and also denied that three men killed by government forces on Sunday were rebels. Mutaqin said they died during a 30-minute exchange of fire between 25 soldiers and 80 rebels in the Seunagan area of West Aceh.

Abu Arafah, a GAM district commander, said the military had killed civilians "because they are frustrated they had no success finding GAM." The violence comes after a call by the Indonesian government on Monday for Sweden to take action against exiled GAM leader Hasan di Tiro, who has lived in the country since 1979.

An estimated 10,000 people have died since 1976 when GAM began its fight for independence in the province at the tip of Sumatra island. An Acehnese rights body earlier said 845 civilians have been killed this year alone.

Indonesia says Aceh peace talks could be useful

Reuters - August 26, 2002

Jakarta -- Indonesia said on Monday more peace talks with Acehnese rebels could be useful, only four days after playing down chances of dialogue by saying the separatists would have to accept a special autonomy package first.

Chief security minister Susilo Bambang Yudhoyono said Jakarta initiated the plan to resume talks with the Free Aceh Movement (GAM) in early September but a recent bomb blast in the rebellious province had hampered efforts.

"Dialogue in September could be relevant and useful. We're now waiting to hear from the HDC," Yudhoyono told reporters, refering to the Geneva-based Henry Dunant Centre for Humanitarian Dialogue (HDC) which has mediated talks over the past two years.

The government recently gave GAM until December to abandon its armed struggle in exchange for peace talks and accepting a special autonomy package unveiled last year. That autonomy deal gives the local government more say in running its own affairs.

The rebels have been fighting for independence since 1976 but violence has escalated over the past two years despite a series of talks. The Brussels-based International Crisis Group estimates 2,000 people were killed in the conflict last year.

The last round of talks was held in May but again failed to halt unrest in the province on the northern tip of Sumatra island.

In the latest bout of violence, 13 people were wounded after a bomb exploded in the provincial capital Banda Aceh -- 1,700 km northwest of Jakarta -- on August 17 when people had gathered to mark Indonesia's independence day.

Failure of courts hurts Jakarta's effort to control rebels

Christian Science Monitor - August 23, 2002

Dan Murphy, Langsa -- Nurjannah jumped back when the soldier poked his head out of the early morning sunlight into her kitchen. But she was quickly reassured -- his rifle was slung carelessly over his shoulder, and he politely asked her in perfect Indonesian to wake up her husband, Kamaruddin. "Don't worry," the soldier said. "We just need you to send him out front with the others now." "I did what he asked," Nurjannah says.

A sleepy Kamaruddin, stretching as he went out, was also calm. The couple had moved to company housing at the Bumi Flora rubber and palm-oil plantation after their marriage six years ago. It had proven a peaceful eddy amid Aceh's 25-year-old war for independence. Their two children had been born here and were thriving in the country air.

But as her husband and a cluster of male neighbors were led to a small clearing, her heart went cold. According to transcripts from government and human rights workers' interviews with eyewitnesses, the soldiers ordered the men to remove their shirts and squat down. They then asked the men if they were Javanese, Indonesia's dominant ethnic group. After the men affirmed they were all ethnic-Acehnese, the soldiers, who witnesses say were members of the Indonesian military, opened fire, killing 30 men and one small boy.

Kamaruddin wasn't hit by the first salvo. Nurjannah says she ran from soldier to soldier, begging "please don't kill my husband." One soldier warned her to be quiet, then stepped forward and killed Kamaruddin. "I want those men brought to justice," says Nurjannah in a flat-voiced interview a year after the murders. "But I've come to accept that will never happen." Nurjannah's fatalism highlights a disturbing national trend that has deepened under the year-long leadership of President Megawati Sukarnoputri: The collapse of efforts to use the justice system to rein in military abuses and lower the temperature in conflict areas like Aceh, where 25,000 troops are arrayed against 5,000 members of the rebel Free Aceh Movement (GAM).

Instead, incidents like the August 9, 2001, massacre at Bumi Flora in East Aceh -- which the Indonesian military claims was carried out by GAM -- are largely ignored or undermined by what observers say are disturbingly weak prosecutions and investigations.

"There is no functioning legal process in East Aceh, or anywhere else in Aceh," says Jusuf Puteh, the head of the East Aceh Human Rights Assistance Post, an independent organization that has been collecting evidence on the Bumi Flora case.

Aceh is home to one of the world's largest natural gas fields, run by ExxonMobil. The insurgency has its roots in anger that most of the province's natural-resource revenue has traditionally gone to Jakarta. Ms. Megawati has promised her government will "crush" GAM, something her three predecessors failed to do. This week, Security Minister Susilo Bambang Yudoyono warned the rebels to sign a peace deal by Dec. 7 or face "intensified military operations." GAM said it was willing to resume talks.

But to many in the province, the failure of justice is only inspiring the next generation of rebels. Lawyers in Aceh say no cases have been brought against soldiers over the past two years, and that when investigations are pursued, they are undermined by an apparent unwillingness of the police and civilian human rights officials to pursue leads.

"The government is using the armed forces to extract concessions at the negotiating table," says Aceh legislator Abdullah Saleh. "It's an approach that will only work if the soldiers are professional. What can make them professional is a justice process. That's the missing piece." Meanwhile, the Bush administration, which sees Indonesia as an important ally in the war on terror, is seeking to normalize military relations -- broken after 1999 abuses in East Timor.

But Western diplomats say a resumption of full ties could be postponed because of the absence of efforts to achieve justice in Aceh and elsewhere. Last week, Indonesia acquitted six military and police officers on charges related to the East Timor violence. In a statement on the verdict, State Department spokesman Philip Reeker said the US was "disappointed that prosecutors in these cases did not fully use the resources and evidence available to them."

In the Bumi Flora case, Mr. Puteh says he began interviewing more than a dozen eyewitnesses and witnesses a day after the killings. Having compared notes with other investigators, including the US-based Human Rights Watch, Puteh says he's convinced the massacre was carried out by Indonesian soldiers. But he says getting the government's National Commission on Human Rights to compile a dossier for prosecution is a losing battle.

Though the commission agreed to conduct a full investigation earlier this year, Mr. Puteh says little work has been done. "It seems like the government has no interest in this case," he says.

The most puzzling aspect of the killings is motive -- though Western governments have accused Indonesian forces in the past of killing civilians to punish GAM attacks. Junior police officials in East Aceh say they don't investigate allegations against soldiers, leaving it up to the Army to police itself.

Admiral Widodo Adisucipto, the armed forces chief at the time of murders, has blamed GAM for the massacre, as has General Endriartono Sutarto, the army chief of staff. Military and police officials have variously suggested the motive for the killing was a refusal of Bumi Flora's owner to pay a bribe, the workers' refusal of a GAM demand they go on strike, or collective workers' refusal to hand over their wages to GAM.

Gaguk Sumartono, the East Aceh police chief, deflects most questions about Bumi Flora, saying responsibility for investigating the case is out of his hands, but adds that he doubts the killings were committed by the military. "People make all kinds of claims," he says. "You have to be careful -- maybe they have a political agenda."

But Aceh-based human rights groups and US-based Human Rights Watch all say interviews with witnesses and survivors point to a military unit. "Look, GAM kills collaborators, government officials, in ones and twos," says a Western diplomat. "They've never massacred large numbers of Acehnese -- it doesn't make sense. They want the support of the local people." The Aceh branch of the National Commission on Human Rights didn't return five calls for comment. National Commissioner B.N. Marbun, who is in charge of the Bumi Flora investigation, couldn't be reached for comment. A secretary at his Jakarta office said he'll be out of the country until September.

The involvement of Mr. Marbun has drawn criticism from some quarters, particularly the US-based Human Rights Watch. He formerly headed the Indonesian government commission to ensure that militias disarmed ahead of East Timor's 1999 independence vote. He failed in that task, and militias armed by the Indonesian military participated in a rampage that claimed 1,000 lives.

Aceh is the most glaring and pressing example, but a faltering justice system is also fuelling a smaller insurgency in Papua Province and ethnic violence on Sulawesi and in the Maluku provinces. Bumi Flora also represents a broader collapse in the legal system, which has fueled a rise in thefts and kidnappings not just by GAM and the Indonesian military but also by criminal gangs that are moving up into the province from North Sumatra.

Both government and nongovernment sources in the province say the southern half of the province is now a shifting field of alliances between corrupt soldiers, GAM rebels, and gangsters.

Nurjannah, the widowed survivor of the Bumi Flora massacre, says focusing on her children has helped her get over her grief. "We weren't rich but our lives were good, we were happy," she says. "I've got to find a way to get that back again."

'War on terrorism'

Muslim leader warns US over Iraq

Reuters - August 29, 2002

Jakarta -- Indonesia's biggest mainstream Muslim organisation said on Thursday it strongly opposed any US attack on Iraq. Hasyim Muzadi, head of the 40-million strong Nahdlatul Ulama, said his group would protest if the United States launched military action against Iraq, although he declined to say how.

Indonesia is the world's most populous Muslim nation and a strike on Iraq would inflame the country's small, radical Islamic groups. It would also cause plenty of unease among the moderate Muslim majority in a country already under pressure to do more in the US-led war on terrorism.

"We totally oppose a US attack on Iraq ... What would it be based on? There's never been a clear argument from the United States, even their allies oppose it," Muzadi told reporters on the sidelines of a seminar on terrorism in Jakarta.

"If the US strikes, they will lose significant value as a democratic country ... and we will protest." Muzadi said he had conveyed his stance to US Secretary of State Colin Powell when Washington's top diplomat visited Jakarta on August 2 and promised Indonesia $50 million to help its security forces fight terrorism.

In remarks that triggered worldwide unease, US Vice President Dick Cheney on Monday laid out the case for pre-emptive action against Iraq, warning of the danger of weapons of mass destruction falling into the hands of terrorists.

US allies have called on Washington to give the United Nations and other international bodies a chance to try diplomacy before any military action. Asian giants India and China have opposed any attack.

Islam in Indonesia is overwhelmingly moderate but the country, home to 210 million people, is regarded as Southeast Asia's weakest link in the US-led war on terror.

Fears militant strains of Islam may take hold in the region have fuelled calls in Washington for more help for the vast archipelago, which has struggled to manage its chaotic transition to democracy after decades of authoritarianism.

Chief Security Minister Susilo Bambang Yudhoyono, also speaking on the sidelines of the seminar, reiterated Indonesia's stated policy to combat terrorism and said its root causes also had to be dealt with.

"Indonesia has an obligation to prevent terrorism ... It is crucial to bear in mind that dealing with terrorism is not about a particular organisation or individuals ... but we need to seek and touch the root of the problem," he told reporters.

"For instance ... we should also focus on issues such as poverty, the social gap between the rich and poor, injustice. I think these phenomena is very much related to terrorism."

Singapore suspected terrorists extradited from Indonesia

Agence France Presse - August 27, 2002

Singapore has said it wants a group of suspected terrorists holed up in Southeast Asia to be extradited over a plot to blow up American, Israeli and other targets in the city-state.

Negotiations were under way with Indonesia, the home base of the militant Jemaah Islamiyah (JI) organisation, whose members are also believed to be scattered through Malaysia, Indonesia, Thailand and the Philippines.

JI has been linked to Osama bin Laden's al-Qaeda network, and 13 members were arrested in Singapore last December planning what an official report described as a potentially "catastrophic" bombing campaign.

Other JI members fled after the arrests, Home Affairs Minister Wong Kan Seng told parliament Tuesday.

"They are dispersed and are believed to be hiding in Malaysia, Indonesia, Thailand and possibly the Philippines," Wong said.

"Efforts are being made to bring them back to assist in investigations." Wong said there had been discussions with Indonesian authorities and "they understood what we have on them [JI members], but Indonesian laws apparently currently do not allow them to take action at the moment." Wong gave no further details on the talks with Indonesia nor the number of wanted JI members, but said his ministry was finalising a White Paper on the 13 arrests and the terrorist threat.

The home ministry had earlier named Mas Selamat Kastari as a JI member and Islamic militant who planned to hijack a commercial jet and crash it into Singapore's Changi Airport. He is now believed living in Indonesia.

Singapore has also labelled an Indonesian Muslim cleric, Abu Bakar Ba'asyir, as the leader of the terrorist organisation.

The 13 arrested JI members are being held under Singapore's tough Internal Security Act, which allows detention without trial. They are said to have confessed to "terrorism-related" activities and to trying to buy 17 tonnes of ammonium nitrate to make seven huge bombs.

Wong said security agencies in the region were working closely on terrorist-related investigations. "As a result of the information that we share with the Malaysians, for example, they have also mounted their own operation and found their own group of Jemaah Islamiyah," he said.

Last month, the home ministry said two men, code-named "Sammy" and "Mike", were the brains behind the intended operation in Singapore which targeted the US embassy and other Western interests, as well as an underground railway station.

Local operatives were to carry out surveillance and preparatory work with suicide bombers brought in from overseas to complete the job.

Sammy was arrested in Oman in July using a Canadian passport bearing the name of a 20-year-old Kuwaiti, Jabarah Mohammad Mansour. He is now in US custody. Mike was identified as Indonesian Fathur Rohman al-Ghozi, who is now serving a 12-year jail sentence in the Philippines.

Government & politics

Megawati's sister launches new political party

Jakarta Post - August 30, 2002

Jakarta -- President Megawati's sister, Rachmawati Soekarnoputri, proclaimed here on Thursday the establishment of a new party, Partai Pelopor (Pioneer Party).

Speaking to the media after the announcement, Rachmawati said the party aimed to implement the teachings of Bung Karno, the late first president who is also her father, to create a just, prosperous, devout, nationalistic and democratic society. "Our ideal is to create a just and prosperous society. To achieve this goal, the leadership of a progressive, revolutionary party is needed. The revolution will not be finished before a just and prosperous society has been created," she said, as quoted by Antara.

She said that a sharp change of direction was needed as the way to overcome the current crisis in the country. "We have to return to the teachings of Bung Karno, which are commonly called Indonesian-style socialism or marhaenism," she said.

Asked why she was now turning to politics, Rachmawati, who has so far been active as head of the Bung Karno Education Foundation, said she had done it at her friends' request. She also said that by doing so she wished to be able to implement the teachings of Bung Karno along with her friends.

She also expressed concern at the current state of the nation. However, she was optimistic about the effectiveness of Bung Karno's teachings following the collapse of communism and capitalism. She said the present government had no clear vision and mission. The ruling PDIP had also turned away from the grass roots.

"I wish to ask Mbak [sister] Mega [the President] whether she is siding with capitalism or with the oppressed marhaens [grass roots]. I really wish to talk with her about it anytime," she said, adding that Megawati had never promoted Bung Karno's teachings.

The declaration was attended, among others, by former president Abdurrahman Wahid, who is also cofounder of the National Awakening Party (PKB), and the chief of the Bung Karno Nationalist Party (PNBK), Eros Djarot. Abdurrahman is listed as a member of the new party's advisory board.

Bill empowers parties to oust dissenting legislators

Jakarta Post - August 30, 2002

Jakarta -- In yet another sign of a return to New Order policies, the government is now drafting a bill that will give more power to political parties to expel non-conformist legislators from the House of Representatives, likely quelling opposition voices, an essential ingredient in a healthy democracy.

Speaking to reporters after a limited Cabinet meeting discussing political bills, Minister of Home Affairs Hari Sabarno explained that the bill on the rank and position of legislators and regional representative members would allow political parties to withdraw their members from the legislature for any perceived offense.

The draft law required House members to surrender their seats should the party they represent fire them. At present, a House member may retain his or her seat despite having been fired by his/her political party.

Hartono Mardjono and Abdul Kadir Jaelani are those who still occupy their legislature seats despite being dismissed by their party, the Crescent Star Party. They are now independent legislators, not affiliated with any faction at the House.

The draft law would effectively be another step back toward the policies of the New Order era, in which political parties were allowed to change their members whenever they considered it necessary, which was criticized by the reform movement as quashing any dissenting or opposition voices.

Hari also said that the bill would require the establishment of an honorary committee to supervise the performance and conduct of legislators.

"The honorary committee may take stern measures against lawmakers who have violated the code of conduct [for legislators]. But, there is a chance for them to defend themselves before the committee," he explained.

In addition, Hari said the limited Cabinet meeting also discussed a presidential bill, and the bill would be deliberated separately with the general election bill, currently under debate by the lawmakers.

"The general election is for legislators, the presidential election for presidents, so it's better to separate them," said Minister of Home Affairs Hari Sabarno on Thursday after a Cabinet meeting discussing the presidential election draft law.

Hari added that despite the separate bills, the general election would still consist of one ballot to vote for political parties and the president.

Voters here will, for the first time ever, be allowed to directly elect the president in 2004. But the laws to allow election organizers to start preparing have yet to be finalized.

The General Election Commission (KPU) demanded the laws be ready by the end of this year at the latest. Having said earlier that it needed two years to properly organize the election slated for June or July 2004, KPU must now settle with less than one and-a- half years of preparation.

But Hari assured the KPU that the government would meet the deadline. "We have our target for passing the bills, and we won't hamper the KPU from meeting their target." Also crucial to the 2004 election is the deliberation of the political parties bill which will define the criteria of what constitutes a party, its rights and obligations.

Also discussed was the status of the People's Consultative Assembly (MPR) which before the recent amendments to the Constitution was the country's highest law-making body.

A coalition of non-government organizations (NGOs), also weighed in on the new political laws, and proposed on Thursday that parties should be able to receive more money. The NGOs said they wanted to raise the ceiling for campaign funds to Rp 5 billion (about US$568,000) from Rp 500 million for donations from companies or organizations, and to Rp 1 billion from Rp 50 million for donations from individuals.

Indonesia's difficult archipelagic geography made campaigning a costly effort, the coalition reasoned. It was speaking before the House's special committee that is drafting the general election bill.

They were quick to add, however, that with more money there would have to be tighter scrutiny on the flow of campaign funds. Among the measures suggested was for parties to set up a special campaign-only bank account to separate the cashflow with those of the party's day-to-day operations.

The coalition included Indonesian Corruption Watch (ICW), the Indonesian Institute of Legal Aid Foundation, the Indonesian Environment Forum (Walhi), and the Center for Electoral Reforms (Cetro).

Indonesian politicians creating own fiefdoms

Straits Times - August 29, 2002

Marianne Kearney, Jakarta -- New districts and regencies are mushrooming across Indonesia as ambitious politicians try to carve out fiefdoms to increase their political power and attract more funds to the newly created districts.

In the last four years, four new provinces have been added in the country. And while 22 new cities or districts were approved by the Indonesian Parliament last year, up from 12 the year before, officials from the Home Affairs Ministry say another 25 new districts or kabupatens will probably be given the go-ahead this year.

Observers say members of the local elite, nursing ambitions of becoming politicians and district leaders, are pushing for the new provinces and districts. Such moves allow those pushing for them to get influential positions, said Mr Bernard May, an adviser with the German Agency for Technical Cooperation.

Each district has to have a new parliament with a minimum of 25 seats, which means that many new positions for aspiring members of the elite. In addition, the local government of a new province or regency is entitled to funds from the central government.

Both financial gains and a desire to carve out a district for ethnic groups are factors behind the push for the dozens of new districts, said Mr May.

For the local elite who might have missed out on becoming local legislators, a new city or district allows them a better chance of positioning themselves for the next elections, say other observers.

Said Mr Adi Abidin from the Asia Foundation: "For the local elite it works because once the new city or district is established, they get the first shot at trying to manage this area."

Most of the new cities or districts created thus far have been in resource rich areas outside Java and Bali, primarily because the local politicians see the financial potential of creating new districts in areas where royalties from mining or gas are high, said Mr Adi.

For example, Kutai, a district in East Kalimantan which has extensive mineral resources, has been divided into three districts while local politicians have proposed a new province in Sumbawa, another mineral rich area.

And in Riau province, a scandal has erupted as a local politician tried to create a new province for the Riau islands, which would have included Batam and Bintan islands, home to an extensive manufacturing industry.

Following allegations that some amount meant for development was spent wrongly on lobbying Jakarta, local groups are calling for his dismissal.

However, bids from would-be district politicians are usually successful. The local elite persuades national politicians to back its demands for a new district and the supporting legislation is passed in Jakarta, once the regional parliaments have given their approval.

Observers suspect would-be politicians or mayors are offering financial incentives to get the approval. Mr May says too many new districts have been approved and there may be problems funding their administration.

New provinces

Three years ago, there were 27 provinces in Indonesia, one of which was East Timor, which is now an independent country.

There are now 31 provinces. The new ones are: Banten in West Java Gorontalo in North Sulawesi Bangka and Belitung off South Sumatra North Maluku in Maluku.

Jakarta leaders turn to supernatural forces

Straits Times - August 28, 2002

Devi Asmarani, Jakarta -- Women use it to entice the opposite sex, celebrities often resort to it to boost popularity and politicians turn to it to further their careers -- the supernatural.

They are all clients of Indonesian psychics, practitioners of the occult and others with knowledge of the supernatural -- all enjoying booming business despite the economic crisis.

In fact, with the current crisis, more people are turning to them in the hope of getting supernatural help to survive the tough times. Even government leaders consult them when making policies.

Mr Solichin W.D., a spiritual consultant, told The Straits Times: "Indonesian leaders come from a society where the traditional belief in the supernatural predates Islam, and other religions are still strong. When they want instant promotions, or their political careers to survive, or in times of crises, it is easier to for them to resort to the mystical world."

The recent "treasure-hunt" controversy involving Religious Minister Said Aqil Munawar is an example of how widespread faith in the supernatural is in Indonesia. Mr Said ordered the digging of Batutulis in West Java after he consulted "a wise man", a Muslim cleric with supernatural powers, who told him there were millions of dollars worth of national treasures under the Batutulis site.

The hunt embarrassed the government, with the minister later apologising after being censured by President Megawati Sukarnoputri.

History shows that nearly all of Indonesia's presidents, including Ms Megawati, have relied on the supernatural while in power. No one was more criticised for it than Mr Abdurrahman Wahid.

Before coming to power in 1999, the Muslim cleric told his friends that it had been revealed divinely to him that he would lead the country. Millions of his loyalists from the Nahdlatul Ulama, the Muslim group he once led, cited this as they tried to block his impeachment.

Aides have said that when he was moving into the presidential palace in 1999, he had psychics "cleanse" the place from the spirits kept by former president Suharto.

He visited the graves of Indonesia's holy men regularly, including the nine pioneers of Islam in Java, especially before making key political decisions. He also consulted clerics with psychic powers.

At one point, VCD copies of him engaged in what appeared to be a supernatural ritual circulated. Conservative Muslims criticised his practice of Islam as heretic.

Former president Suharto was also known to consult spiritual advisers and visit sacred historical sites and graves to seek divine help. During his 32 years in power, he meditated regularly at remote Java locales to seek magical power.

The late president Sukarno also leaned towards the supernatural. History books say that he sought divine support for the independence struggle at the ruins of the Jayabaya Kingdom in East Java.

Sources say his daughter, Ms Megawati, is equally superstitious. She moved the presidential office to another building when she came to power last year so as not to "absorb the aura of her predecessors".

Parliament puts a democratic gloss on autocratic constitution

World Socialist Web Site - August 27, 2002

John Roberts -- Indonesia's People's Consultative Assembly (MPR), which met in Jakarta from August 1-11, has approved a series of constitutional changes that are aimed at ending some of the more blatantly anti-democratic provisions of the country's political system. The changes, however, remain superficial and allow for the continuing dominance of the current ruling elites, including the military, which holds key positions in the administration of President Megawati Sukarnoputri.

Currently the MPR, a third of which is comprised of appointees including 38 military and police representatives, is the country's top law-making body with powers to alter the constitution and choose the president. Under the proposed changes, from 2004 the president will be chosen by direct election and parliament will have no appointees. The MPR will consist of 500 members of the lower house of parliament, the House of Representatives (DPR), and the 200 members of a Regional Representatives Council, all of whom will be elected.

Even these changes provoked opposition from the military, which initially insisted on retaining its appointees in parliament, and Megawati, who opposed direct presidential elections. Other political figures insisted that no changes be made to the autocratic 1945 constitution that gives the president wide powers. Rightwing Muslim parties were pushing for changes that would institutionalise reactionary Islamic law.

At the same time, however, the entire MPR was under pressure from two different sources. On the one hand, international financial institutions have been pushing for constitutional changes that would end the "crony capitalism" of the Suharto era and provide broader avenues for investment and profits. On the other, wide layers of Indonesians, who backed the movement that brought an end to Suharto's rule in May 1998, want genuine democratic reform and have grown disenchanted with an administration that is increasingly subservient to the military.

The character of the constitutional changes is indicated by the way in which they were decided. Determined to keep deliberations out of the public eye, the MPR took no votes in the full sessions. The issues were decided by "consensus", that is, through deals that were worked out behind the scenes.

As the Jakarta Post noted: "No doubt some horses were traded between the political factions, particularly the ones with the most clout, on the way to reaching a compromise. We will probably be hearing about what exactly these factions compromised or gave up in the near future." While applauding the changes, the editorial remarked that the amendments "were enacted with little public participation, and therefore reflect more the interests of the major political factions in securing their places after 2004."

What went on behind closed doors in the MPR is unclear. But one of the influences that brought about a consensus appears to have been a student demonstration on August 6, in the middle of the session. About 7,000 students drawn from all the major universities around Jakarta, stormed the parliamentary building before being finally forced back by police using water cannon. They were demanding direct presidential elections, an end to the military's role in the MPR and the rejection of calls to insert Islamic law in the constitution. Before the protest, the MPR was still in conflict. Shortly after, agreement was reached.

The demonstration was comparatively small by Jakarta standards. But the MPR delegates were aware that protests demanding democratic change during the MPR session in November 1998 rapidly mushroomed in the course of a week from hundreds to thousands and, by some estimates, hundreds of thousands. The movement was eventually broken up by a brutal police attack that resulted in a number of deaths. None of the factions in the latest MPR session wanted the repeat of a situation that threatened to spiral out of control.

There is also no doubt that considerable pressure was exerted behind the scenes on the MPR by international financial institutions and governments. The British-based Economist magazine made clear what was at stake for international finance capital in an article that cautiously welcomed what it termed "Indonesia's constitutional revolution." Pointing to the need for an end to economic cronyism and political volatility, the article stated: "Starting with the fall of Suharto, a long-serving strongman, in 1998, Indonesia has had four presidents in as many years. The chronic political instability has derailed many urgent economic and political reforms." Honing in on the presidency, the Economist commented: "The biggest problem, until now, was that the MPR was empowered both to elect and unseat the president. In consequence, the country's highest office was decided not by popular vote, but by horse-trading among Jakarta's notoriously corrupt and high-handed elite... Direct presidential elections, by contrast, should strengthen the president's mandate, and pave the way for bolder governments."

The so-called reform agenda of these "bolder governments" is that laid out by the IMF and other financial institutional- privatisations, budget cutbacks, a firesale of bad debt and a more open and transparent economy for international investors. The inability of previous administrations to push through these measures reflects not only divisions in ruling circles but their fear that growing social polarisation will provoke broader resistance from the working class and poor who will be most severely hit.

Limited changes The constitutional amendments finally agreed on are limited and tentative. Laws still have to be established governing both general and presidential elections. The MPR rejected demands from reform groups to give a new constitutional commission a small degree of independence by formalising its role in the constitution. Instead the commission was established by decree, giving the MPR the right to overturn any of its decisions.

A law on political parties exists in draft form and is due to be adopted in November. It is designed to drastically reduce the number of registered parties, which currently number around 200, to no more than 10 at the next general election. For a party to be registered for the next election it will have to have a presence in two-thirds of the country's 30 provinces. In each province, it must have branches in two-thirds of the cities and regencies and each branch must have at least 1,000 members.

The new rules, which replace an already restrictive 1999 law, will effectively limit the elections to existing major parties- that is, those backed by big business, the military and state bureaucracy. There is every likelihood that the presidential election will be just as narrow.

Vague MPR proposals, to be pursued by the DPR and the constitutional commission, were made for the establishment of a constitutional court and new provisions for the impeachment of the president. In 1999, President Abdurrahman Wahid was forced out of office by Megawati with the backing of the military and the MPR in a long drawn out impeachment involving dubious allegations of corruption. The ruling elites are concerned to try to prevent a repetition of what was a profoundly destabilising process.

At the conclusion of the current MPR session, speaker Amien Rais presented the amendments as a great gain for democracy in Indonesia. He described the direct election of the presidency and the end to military appointees, as a "giant stride". "The TNI and Police," he declared, "will become professional state security and defence forces ... no longer involved in day-to-day politics." In reality, the decision by the TNI to give up its seats in parliament was a minor concession to appearances. Under Megawati, the military has strengthened its political position, further regaining the clout and confidence that was shaken in the wake of the Suharto regime's collapse.

In Megawati's opening speech to the MPR, she emphasised her government had removed the threat of disintegration that had "shadowed" the country since 1998, identifying herself once more as a reliable ally of the army generals. She went on to promise a freer hand to the military to take tough action against separatist movements, particularly in Aceh, where the government is preparing to declare a state of emergency.

Megawati relied heavily on the military to oust Wahid, who had alienated the generals by attempting to reach a negotiated deal with separatist movements in Aceh and West Papua. In July 2001, Wahid attempted to avoid impeachment by declaring a state of emergency. It was only when the TNI leadership refused to obey Wahid's order that the way was cleared for the MPR to install Megawati. As a result, she is beholden to the military-five former generals serve in her administration including in the top security post.

The TNI top brass has also gained more room to manoeuvre with the Bush administration's efforts over the last year to re-establish close ties between the Indonesian and US military. Under the guise of the war against terrorism, the US is looking towards the Indonesian generals as a means for shoring up capitalist rule in conditions of increasing political instability-just as it relied on the Suharto dictatorship for over three decades.

It may be some time before the details of the deals worked out in the backrooms of the MPR surface in public. But it is already clear that no fundamental democratic reforms have been made. The MPR contains many of the individuals who rubberstamped Suharto as president for five successive terms of office-fully aware of his brutal methods of rule. Incapable of meeting the needs of the working class and poor, these privileged ruling elites are organically incapable of granting any genuine democratic rights to the majority of the population.

Government moves to limit number of political parties

Jakarta Post - August 27, 2002

Tiarma Siboro, Jakarta -- The government dispelled public fears on Monday over the number of political parties participating in the 2004 general election, saying that all parties would undergo a strict screening process before they were allowed to contest in the event held once every five years.

"There are various new political parties that have so far registered with the Ministry of Justice and Human Rights, but the ministry will conduct a series of investigations to decide on whether or not these parties will qualify," Minister of Home Affairs Hari Sabarno said during a hearing with the House of Representatives (DPR) special commission deliberating the general election bill.

Over 200 political parties have registered with the justice and human rights minister and have expressed their readiness to contest the 2004 general election.

President Megawati Soekarnoputri said in her speech on August 16 that the presence of so many parties had made it difficult for them to develop into strong parties and support the government's performance effectively.

Hari said not every [political] party that had registered at the Ministry of Justice and Human Rights would automatically be allowed to contest the 2004 general election.

Hari said that the election law passed in 1999 stipulated that parties failing to reach the two percent electoral threshold would be barred from joining the elections in 2004.

Only six of the 48 political parties participating in the 1999 general election qualified to contest the next ballot as "by law, they passed the requirement of meeting the two percent threshold of the vote," he said.

The six parties are the Indonesian Democratic Party of Struggle (PDI Perjuangan), the Golkar Party, the United Development Party (PPP), the National Awakening Party (PKB), the National Mandate Party (PAN) and the Crescent Star Party (PBB).

Politicians of the five biggest parties in the country had earlier demanded to restrict the number of political parties to contest the election, considering the fact that the multiparty system was not suitable to be adopted in the direct presidential election system.

In the proposed election bill, the government has suggested that political parties wishing to contest the 2009 general election have to reach a three percent threshold of the vote.

On Monday, the government also proposed to adopt an open proportional system and district system to elect members of the House of Representatives and Regional Representatives Council (DPD) respectively in the 2004 general election.

Women demand recognition in politics

Jakarta Post - August 25, 2002

Moch. N. Kurniawan, Jakarta -- Gender-biased politics in Indonesia could be substantially changed if political parties were required to let women make up 30 percent of legislative candidates, analysts said on Saturday.

They demanded that the proposal be accommodated in the general elections bill now being deliberated in the House of Representatives.

Chusnul Mar'iyah, Smita Notosusanto and Andi Mallarangeng were of the opinion that such a quota was the minimum requirement if Indonesia was to promote the role of women in politics and the high-level decision-making processes.

"The quota is a must for women. We want the government and legislators to adopt it as part of an affirmative action approach," Chusnul told reporters after a seminar held in conjunction with the celebration of noted activist Saparinah Sadli's 75th birthday.

Given such a move, women could contribute their ideas to the deliberation process and avoid discriminative articles being inserted into bills.

Deliberation of the electoral bill began on Thursday but the debate with the government will only start on Monday. The bill, expected to be passed into law later this year, does not provide for a quota for women candidates in elections.

Chusnul said that at present women legislators in regency and provincial councils accounted for around 2 percent to 3 percent of the total number of legislators. "The highest percentage is about 12.5 percent in a place in Sumatra. Bali has no women legislators in the provincial legislative council," Chusnul said.

At the national level, women only accounted for 9 percent of the total legislators in spite of the fact that they made up more than 50 percent of the total voters.

Women's activists have repeatedly criticized the small number of woman involved in the political parties and the high level decision-making processes. This was due to various reasons, they said, including lack of access, networking, education and cultural support. In the past, women were usually encouraged to involve themselves in social activities such as through the Organization for Family Welfare (PKK), which activists claimed to be part of the systematic marginalization of women in politics.

Supporting women's long-standing demands, Andi said women deserved a greater role to make amends for their marginalization in the past. "We agree that we must help the weak, the marginalized. Therefore, women deserve affirmative action, and that's the job of the state," he said.

Andi is also one of the founders of the Unity, Democracy and Nationhood Party which was established last month, along with Ryaas Rasyid.

But Andi criticized women for their reluctance to become deeply involved in politics. "We really need more women in politics," he said.

Meanwhile, Smita said women activists would step up their campaign across the country to push legislators to pass an electoral law that required 30 percent of legislative candidates to be women. Without such a quota, she said, many policies would only disadvantage women.

"At present, we see that many regencies fail to involve women in politics. This has resulted in policies that are harmful to women," she said. Citing an example, she said West Sumatra, South Sulawesi and West Nusa Tenggara had implemented discriminatory policies by banning women from going out after 9pm.

She also suggested transparent criteria for the selection of legislative candidates in the 2004 elections, thus creating fair competition between men and women.

Calls mount for Cabinet reshuffle amid failures

Jakarta Post - August 26, 2002

Berni K. Moestafa, Jakarta -- Calls to reshuffle the Cabinet are again mounting. Analysts have blamed the development on the Cabinet's poor teamwork and asked whether a reshuffle would benefit President Megawati Soekarnoputri. The answer appears to be both yes and no.

Continued blunders, such as a Government-sponsored treasure hunt and the inept handling of issues surrounding the eviction of Indonesian workers from Malaysia, have led up to new pressure for changes in the Cabinet lineup.

"The time is right for Megawati to reshuffle the Cabinet," political analyst Indria Samego of the National Institute of Sciences (LIPI) said over the weekend. "It will boost the government's performance." Media reports have speculated a reshuffle will be announced after Megawati returns from her trip to South Africa and Europe in September.

Several members of Megawati's Indonesian Democratic Party of Struggle (PDI Perjuangan) have also called for new ministers.

Last week Minister of Religious Affairs Said Agil Al Munawar embarrassed the government when he gave permission for a treasure hunt on a protected historic site in the West Java town of Bogor.

Earlier labor minister Jacob Nuwewa was lambasted for his lack of action after many thousands of illegal Indonesian workers were booted out of Malaysia.

Sporadic debate between ministers as to whether Indonesia needs the International Monetary Fund (IMF), which is providing aid under a tough austerity program, has come to undermine the government's credibility. "It comes down to poor coordination," Indria said.

Indeed, the only minister whom critics have labeled as incompetent is Minister of Defense Matori Abdul Djalil. Others have either failed to follow the government's line, like outspoken State Minister for National Development Planning Kwik Kian Gie, or have been criticized for their policies.

Indria added that several ministers might be competent but they were unable to get things moving, such as Coordinating Minister for the Economy Dorodjatun Kuntjoro-Jakti.

"Dorodjatun has a good understanding of the economy but we cannot approach our economy with theories alone." The economic team has been praised for reestablishing cordial relations with international donors, notably the IMF.

A stronger rupiah and a vibrant stock market are the immediate impact of this. Yet bank restructuring remains painfully slow and farmers, the largest source of employment in Indonesia, cannot compete with the glut of imported commodities.

"Megawati's fate depends on how the public is responding to her government," Indria said. "It may not be in her character [to change ministers] but she might do it anyway out of necessity." Rumors of Cabinet reshuffles first emerged late last year. Those playing down the possibility argued that Megawati refused to follow the infamous moves of predecessor Abdurrahman Wahid who frequently changed ministers.

It took Megawati more than two weeks to finalize her 32-member Cabinet. But she rewarded the waiting with a sound lineup which focused on professionalism without disfavoring political allies.

Megawati confidante and PDI Perjuangan deputy Secretary General Pramono Anung agreed that a reshuffle was unlikely. "I asked her directly about this [reshuffle plan] and she said no," Pramono told The Jakarta Post.

Recruiting new ministers less than two years before the 2004 general election may also prove risky, according to political observer Riswandha Imawan of the University of Gadjah Mada. A reshuffle would show her as shifting problems onto others which he said would miss the point.

Riswandha said the Cabinet was suffering more from poor teamwork rather than incompetent members. "We have here a team of specialists. The malady among many specialists is that they have big egos, and that is hampering teamwork," he explained.

Corruption/collusion/nepotism

Indonesia still among the most corrupt countries: survey

Jakarta Post - August 29, 2002

Jakarta -- Berlin-based Transparency International (TI) has still ranked Indonesia among the most corrupt countries in the world, with scores of two or less, while Finland, Denmark and New Zealand were the "cleanest", with scores of between nine and ten.

In its annual report on Wednesday, the anti-corruption body published a list of 102 countries ranked in order of perceptions of corruption, naming Bangladesh the most corrupt nation and Finland the least.

Nigeria was second-worst, Angola, Madagascar and Paraguay tied at third from the bottom and Indonesia and Kenya jointly ranked as the fourth-most corrupt nations. "[Here] corruption is perceived to be widespread", said TI chairman Peter Eigen in a statement.

The list is compiled from a series of surveys rather than a hard and fast rundown of the world's most corrupt countries; neither does it include those nations where there was insufficient information to make a judgment.

"The political elite and its cronies continue to take kickbacks at every opportunity. Hand in glove with corrupt businesspeople hey are trapping whole nations in poverty and hampering sustainable development," said Eigen.

He warned that corruption paved the way to plundering the earth in activities ranging from illegal logging to "blood diamonds".

TI ranked the countries based on 15 surveys from nine independent institutions. The ranking relates to perceptions of the degree of corruption as seen by businesspeople and risk analysts.

In Asia, top-rated Singapore was followed by Hong Kong in 14th place, Japan 20th, Taiwan 29th and South Korea 40th. China was not included in the list. India was ranked 71st, the same as Russia. Top-ranked Arab country was Tunisia at 36th place, followed by Jordan 40th, Morocco 52nd and Egypt 62nd.

"Politicians increasingly pay lip service to the fight against corruption but they fail to act on the clear message of TI's perceptions index: that they must clamp down on corruption to break the vicious cycle of poverty and graft," concluded Eigen.

Jakarta officials get fingers burned in investment scam

Straits Times - August 27, 2002

Devi Asmarani, Jakarta -- A multi-million-dollar scandal involving an agro-business company has put several Indonesian officials, including Vice-President Hamzah Haz, under the spotlight for publicly endorsing investment schemes that have now left thousands broke.

Police have declared the owner of PT Qurnia Subur Alam Raya (QSAR), Ramli Araby, a suspect after he ran off with more than 500 billion rupiah owed to about 6,500 people from across the country.

Among the investors are top government officials, parliamentary members, high-ranking military officers and journalists. But many are ordinary office workers and housewives who have invested anywhere from two million to billions of rupiah of their savings, hoping to multiply their investment quickly.

Several wives of senior parliamentarians are known to be the company's investors. And their husbands, including National Assembly Speaker Amien Rais and parliamentary Deputy Speaker Tosari Wijaya, have visited the company's farmlands in separate highly publicised occasions.

President Megawati Sukarnoputri also attended a ceremony to launch one of the company's facilities when she was still Vice- President early last year.

But the criticism has been directed mainly at Vice-President Hamzah Haz, who visited the company's farmland in April and publicly praised its business achievements, even though the company was on the verge of bankruptcy.

Mr Hamzah has defended his visit, saying it was meant to promote "exports of agricultural products".

Established by Ramli and his brother, Mr Ramlan Baskara, in 1997, the company started out by growing and exporting vegetables such as tomatoes, potatoes, peppers and cabbages.

Within a short period, dozens of people investing in the company began reaping profits from the exports, especially since the rupiah's value continued to plunge.

It then started offering the public financial schemes, in which investors were promised profits of as much as 45 per cent of their investment within three months. The company then expanded to livestock farming and even the tourism business, and its clients kept growing.

But since February this year, it has been having difficulties paying soaring dividends to its clients.

Ramli has promised to reimburse all the money by this month, but he and the rest of the company's executives have disappeared since his meeting with representatives of the investors last month.

Mr Rodri Zulkarnaen, a marketing executive in a private company, said: "I invested 250 million rupiah late last year, and I'm afraid I have lost it all."

Since Ramli's disappearance, some of the investors have tried to seize the company's assets. They took computers from its abandoned office buildings, and some took the company's cars, motorcycles and buses. There were also efforts to divide up the company's 1,680 ha of farmland.

The investors are now filing a lawsuit in an attempt to get their money back.

Many people have criticised the government for turning a blind eye to the scandal for so long, and questioned the police's sluggishness in investigating the scam. They also blamed government officials for giving permits and even promoting enterprises with dubious credibility.

Media/press freedom

Media bill will put 'spy' in TV and radio stations

Straits Times - August 31, 2002

Devi Asmarani, Jakarta -- A Bill that involves placing a government "spy" in broadcasting agencies here is likely to be passed next month by parliament to regulate the electronic media.

The Bill has been deliberated in the House for the past two years to regulate the rapidly growing broadcasting industry but is being opposed widely by operators of television and radio stations.

They say the Bill will curtail press freedom and retard the industry's growth. Under the Bill the government will issue a "frequency licence" to broadcast to radio and television stations.

An independent regulatory body, the Indonesian Broadcast Commission, will recommend the stations to the government as well as set a code of conduct for electronic media and impose sanctions.

Coordinator of the Indonesian Society of Press and Broadcasting (MPPI) Leo Batubara told The Straits Times: "The Bill gives back the legal authority to the government, instead of the independent body, to decide on which broadcasting company will get licences. It also allows the government to interfere in the daily running of the broadcasting business. This is certainly not what we had in mind when we proposed the draft Bill to parliament -- this is a return to the old paradigm that the government controls the press."

The MPPI proposed the first draft of the Bill to parliament three years ago to replace the 1997 broadcasting law, which it claimed to be repressive. The draft Bill was debated in parliament and over time its content has been altered drastically as the lawmakers thought too much freedom had encouraged irresponsible and provocative press.

The MPPI said that at least a third of the 63 articles in the Bill carried the threat of imprisonment or fines if radio or television operators were found to have broken the law.

One of the contentious articles requires all TV films and advertisements to undergo censorship by the government. Currently, only TV films are censored by the government, but TV operators had called for an end to all sorts of government censorship, arguing it should be done by the respective TV stations instead.

The Bill also says that a "government official inspector" would be placed in each broadcasting company. "This is like having a government spy in our station," said an executive in a private TV station.

Established private television with nationwide reach such as the RCTI and SCTV, will also be forced to undergo major restructuring as the Bill requires all national TV stations to become local stations.

This means the country's 10 private national TV stations have to set up a separate company with local partners and broadcast localised content in each of the regions. Parliament has argued that such a move would prevent the "monopoly of information".

The Bill also limits media cross-ownership and requires electronic media to renew frequency distribution licences after 10 years of operations.

Several media group such as Kompas Gramedia and Media Indonesia operate both print and broadcasting media organisations.

"What we fear is that under this system, the government can deny or lift the frequency licence of some company under the pretext that it broke some law, if its coverage is too critical," said Mr Leo.

Several publications were banned for their critical coverage during the 32 years of President Suharto. His fall in 1998 opened the door to the current press freedom.

Human rights/law

Court ruling 'another blow to legal system'

Straits Times - August 31, 2002

Marianne Kearney, Jakarta -- Legal experts and critics yesterday described the Supreme Court's decision to overturn the graft conviction for Central Bank governor Syahril Sabirin as yet another blow to Indonesia's legal system.

They said the ruling was further evidence of the country's corrupt legal system, which has recently handed down a slew of controversial verdicts.

The court on Thursday overturned Mr Syahril's guilty verdict by the Jakarta District Court in March and dropped his three-year jail term for misusing US$80 million in bank funds in 1999.

Mr Syahril, who was welcomed by smiling employees of the bank when he reported for work yesterday, had continued working with the full support of the bank governors.

Legal experts also say the ruling highlights the poor performance of the state prosecutors and indicates that the Attorney- General's office is unwilling to launch strong cases against major graft offenders.

"The judges and prosecutors often work together and are often not independent of political influence," said Mr Danang Widoyoko of Corruption Watch.

For example, in June, the local unit of Canada's Manulife Financial Corp was ruled bankrupt despite being fully solvent. The ruling was later overturned by the Supreme Court but only because of significant diplomatic pressure from the Canadian government, say observers.

Mr Mark Baird, the outgoing country director for the World Bank in Indonesia, said that when the courts overturned a decision due to strong international pressure, this was not a sign of judicial reform.

"I don't think you are going to see judicial reform in a fundamental way for several years and certainly you are not going to see the elimination of corruption for many years," he said in a talk to foreign correspondents this week.

Mr Johnson Pandjaitan, secretary-general of the Indonesian Legal Aid and Human Rights Association, said that political and economic vested interests in the Syahril case had ensured he would escape punishment. "It was just a matter of time. Now when everyone had forgotten about his case he was freed," he was quoted as saying.

But despite the negative view, Mr Syahril and other legal observers hailed the court's ruling. "Right from the beginning I was convinced this case was baseless," he told reporters.

Judicial Watch head Andi Asrun said: "This is a fair ruling because since the beginning it was clear this was a politically motivated case as former president Abdurrahman Wahid told him to resign or else he'll go to court."

Mr Andi said that two major suspects in the banking scandal, Mr Tanri Abeng and Mr Baramuli, had not been taken to court because 'they are powerful politically'. Both suspects from the powerful Golkar party were said to be behind the deal which involved siphoning US$80 million of Central Bank funds allegedly to finance the election campaign of former president B.J. Habibie.

Meanwhile, the Attorney-General said yesterday his office would appeal against the overturning of the graft conviction against Mr Syahril.

Mob justice increases as people lose faith in system

Jakarta Post - August 26, 2002

Damar Harsanto, Jakarta -- Incidents of mob justice have become almost daily occurrences in Jakarta, as residents frustrated with a justice system that is seen as anything but just take the law into their own hands to mete out harsh punishments on suspected criminals.

The latest incident took place last Tuesday, in the Billymoon housing complex in Pondok Kelapa, East Jakarta. A group of residents mobbed to death Kristian, 35, and severely injured Arifin, 32 and Solihin, 28, after they found the three allegedly trying to rob a house.

This month alone, four similar mob attacks have taken place in the capital, all ending in fatalities. One of these incidents was instigated by a small quarrel between street vendors.

A simple accusatory cry against a person on the street is often enough to provoke a mob attack, regardless of the facts or evidence.

Ery Seda, a sociologist at the University of Indonesia, blames uncertainties in the norms and values prevailing in society today, coupled with political instability, for the recent rise in street justice.

"People continue to repeat such violent actions because there have been no sanctions [social or legal] or any actions to stop or prevent such acts from recurring," Ery told The Jakarta Post.

Ery said public distrust of the legal system, which has failed to punish criminals, has prompted the public to take the law into their own hands.

However, he warned that street justice must be stopped, because it posed a threat to social integration. "People will become suspicious of each other and will judge each other. This situation will lead to social disintegration and chaos," Ery remarked.

Harkristuti Harkrisnowo, a criminologist at the University of Indonesia, associated "vigilante justice" with public frustration with the legal system.

"People turn [to vigilante justice] as an outlet for their overwhelming anger toward an unworkable legal system, especially with respect to the failure of the legal system to deal with high-profile cases," Harkristuti said.

The victims of mob violence, Harkristuti said, are simply replacement targets through which people are channeling their hatred for big criminals, including corruptors who were acquitted of all charges in legal proceedings that disregarded the public sense of justice. Agreeing with Ery, Harkristuti said this mob violence had to be stopped before it did serious damage to society.

"This kind of action is unhealthy as it is prone to manipulation," said Harkristuti. He remarked that groups could manipulate mobs to instigate violence against their rivals or to achieve their own interests.

And punishment without trial, Harkristuti said, ignores the idea of the presumption of innocence and the right of people to defend themselves in a court of law and receive a sentence in accordance with the law. "Taking the law into your own hands through the use of violence is simply a crime and is against the law," said Harkristuti. He said mob violence violated Article 170 of the Criminal Code, which carries at maximum sentence of 12 years in prison.

Commenting on a number of incidents in which the police appeared to be powerless to prevent mobs from killing alleged criminals, Jakarta Police spokesman Sr. Comr. Anton Bachrul Alam admitted officers often were outnumbered and powerless to help the victims of mob attacks. "It has become characteristic for people to be easily instigated to violence," Anton said.

He added that the police also found it difficult to gather sufficient evidence and locate witnesses in order to arrest and try those involved in the mob attacks.

However, he said the police had arrested a number of people who had taken the law into their own hands. "We took legal action against them as what they did was simply criminal," Anton told the Post, though he failed to say exactly how many such cases the police had handled.

Focus on Jakarta

Jakarta's security situation dramatically worsening

Jakarta Post - August 29, 2002

Damar Harsanto, Jakarta -- Jakarta has seen its security situation worsen considerably recently as indicated by the increase in street crime over the last three years, and many people are now afraid of utilizing public facilities, a seminar concluded here on Wednesday.

Street crimes include car thefts, burglaries, robberies, murders, extortion and other crimes that are committed on the streets, it was stated.

Due to the worsening security situation, people are afraid of using public facilities -- such as public phones, ATMs, restrooms, and pedestrian overpasses -- which are installed on or near streets. People are now also even afraid of using public transportation.

"Such feelings are forged through bad personal experiences and other people's bad experiences," said Rony Samtana, who was a speaker at the one-day seminar titled "How more frightening Jakarta is today", which was held on Wednesday at the Police College.

The seminar was the first seminar in the Police College's history to be held in the English language, and featured, among other speakers, Steven Hargrove, a police consultant from the United States Embassy who is assigned to liaise with the National Police, and two other speakers, both of whom are students of the Police College.

Rony said the rising number of offenses being solved by the police had failed to remove public feelings of insecurity due to the massive number of unreported crimes. Rony remarked that many people still felt threatened by crime given that the reported cases were only the visible tip of a massive iceberg.

Another speaker, Dedi Kusuma Bhakti, attributed lingering feelings of insecurity in society to rampant street crime. "Most of the crimes have occurred on the streets. It's no wonder given that Jakarta residents spend a lot of their time on the streets as they go to their workplaces and return home," Dedi told the seminar.

One of the police speakers shared his experiences of the Blok M bus terminal in South Jakarta, where he managed to arrest nine pickpockets out of only 11 passengers on a public bus.

According to police data, the number of cars stolen last year jumped to 6,466 from only 2,593 and 3,384 respectively in 2000 and 1999. For the first seven months of this year, the figure was still hovering at 3,525. This means that more than 16 cars are stolen every day.

The number of extortion cases rose to 524 last year as compared to 276 and 246 in 2000 and 1999. As of July this year, 270 extortion cases had been reported.

Last year, the number of burglary cases doubled to 5,093 from 2,853 and 3,194 respectively in 2000 and 1999, while in the course of the first seven months of this year, the figure stood at 2,858 cases.

Robberies also jumped to 2,047 last year as compared to 1,467 in 2000 and 1,616 in 1999, while the figure so far this year stands at 1,402 cases.

In addition to increasing crime, the police's poor performance is also widely believed to have contributed to the feeling of insecurity among Jakarta residents. The police are often criticized for being late to arrive at crime scenes and for the lack of police patrols in areas prone to crime.

Meanwhile, Steven Hargrove said the police must cooperate with all elements in society to crack down on rising crime in the city. "The police must bring in all the people in the community, including businesspeople, non-governmental organizations, governmental institutions, as partners to promote security in the city," Hargrove said.

Partnership with all parties in society, Hargrove said, would also in turn help improve public appreciation for a police officer's dangerous and difficult jobs. "The salary that you get today doesn't tell that [about the dangers involved in police work]," Hargrove said, adding that a salary hike might also provide the impetus for police officers to improve their professionalism and performance.

NGOs demand direct election, current process terminated

Jakarta Post - August 29, 2002

Bambang Nurbianto, Jakarta -- A total of 49 non-governmental organizations on Wednesday demanded that President Megawati Soekarnoputri stop the ongoing Jakarta gubernatorial election process, stressing that it was being carried out undemocratically and against the prevailing regulations.

The NGOs included the Jakarta Legal Aid Institute (LBH Jakarta), the Jakarta Social Institute (ISJ), the Jakarta Residents' Forum (Fakta), the Sanggar Ciliwung organization, the Let's Watch organization, Women's Solidarity, the Urban Poor Consortium (UPC), and the Society of Indonesian Professionals (MPI).

In their joint communique, the NGOs call for the formation of a caretaker administration tasked with organizing a gubernatorial election where the governor would be chosen directly by the people.

According to the NGOs, the election process should be stopped as the City Council had several times violated the election procedures that it had approved.

The violations included lack of transparency and inconsistency in the selection process; not all candidates were invited to interviews; a gubernatorial candidate was permitted to become a vice gubernatorial candidate, and the number of councillors attending most of the plenary sessions during the selection process did not meet the quorum.

"How can we expect good governance from the next City Administration if we allow this unfair gubernatorial election process to continue," Tubagus Haryo Karbiyanto of the Jakarta Legal Aid Institute (LBH Jakarta) told the press.

The City Council has selected seven pairings of gubernatorial and vice gubernatorial candidates. The seven pairings of candidates have been reported to the President through the home affairs minister. Among the pairings, incumbent Governor Sutiyoso and City Secretary Fauzi Bowo are the strongest so far, and it would seem that only President Megawati Soekarnoputri could stop them from becoming the next governor and deputy governor of Jakarta.

Other pairings include the deputy chairman of the council, Tarmidi Suhardjo, who is paired off with the secretary-general of the National Mandate Party (PAN) Abdillah Toha, and City Council Chairman Edy Waluyo who is paired with an executive of the United Development Party (PPP) Ahmad Suaidy.

The communique also questioned the integrity of two of the main candidates, Sutiyoso and Tarmidi, as both of them are suspects in criminal cases.

The Jakarta Military Police have named Sutiyoso a suspect in the July 27, 1996, incident when military personnel and civilians attacked supporters of Megawati Soekarnoputri. Meanwhile, Tarmidi is a suspect in a corruption case involving the management of the state-owned Ancol amusement complex.

The NGOs said that many of the City Councillors had been involved in money politics during the selection process.

The communique also said that the ongoing selection process had ignored the people's aspiration as the City Council only accommodated the interests of the political parties and the owners of capital.

"Therefore, the process should be stopped and it is time to hold a direct election by the people," said the communique, which was read out during the press conference.

Ratna Sarumpaet, chairwoman of the Governor and Vice Governor Forum, said that the NGOs would follow up on the communique with various forms of action, including public rallies, speeches, and possible occupation of the City Council building.

News & issues

Tommy adapting to prison despite the bites

Straits Times - August 27, 2002

Jakarta -- Jailed Indonesian businessman Tommy Suharto has complained about night-time mosquito bites but is otherwise adapting to simple prison food and the lack of privileges at his new prison on the island of Nusakambangan.

Prison warden Sumantri told reporters that the youngest son of former president Suharto had asked for a pesticide spray. "I suggested he apply mosquito repellent instead," the warden told reporters on Saturday.

Tommy was jailed last month for 15 years for ordering the murder of a Supreme Court judge and for illegal weapons possession.

His cell, number 17-B, is next to that of his father's former golfing partner and business crony Mohammad "Bob" Hasan, who was jailed for six years for corruption. Hasan is expected to serve as mentor to Tommy, who is on a 30-day orientation period at the Batu penitentiary on the island off Central Java. He was transferred there on Aug 15.

And unlike the time he spent at Jakarta's Cipinang penitentiary, where he had access to his own television and had a shower installed in his cell, life in Batu is more spartan. Like the 173 other inmates there, Tommy has to attend morning and afternoon parades and has to share a TV set with others.

Mr Sumantri said Tommy was allowed visitors only on Mondays and Thursdays. Two of his sisters and his visited him last week, arriving by helicopter. The prison chief said that only family and not "former girlfriends" would be allowed to visit.

Trapped in Jakarta's hotel of broken dreams

Melbourne Age - August 26, 2002

Matthew Moore -- In the grimy rooms of Jakarta's Hotel Borneo, a dwindling bunch of mostly Afghan asylum seekers sit around and wait for the end of another slow day.

It's at least a year since they conned and bribed their way into Indonesia, with pockets full of cash, a plan to ride a boat to Australia and a dream of a new life ahead. Now only the dreams are left, and Australia is no longer in them.

This is peak season in Indonesia's boat people business, but nothing is moving. Port authorities and police say there are no longer any asylum seekers or boats planning to risk a trip to Australia.

All that's left are hotels like the Borneo, dotted throughout Indonesia, that are now home to those who never quite made it to Australia and who have yet to accept that they might be forced to return home.

They are full of people like Mohammed Yasin, who was 17 when he slipped from Afghanistan into Pakistan with his cousin last year and paid an agent $US 2,000 to get him to Indonesia.

After lying low for a month, they spent a further $A11,000 for two of 142 places on a 16-metre boat that left East Java a year ago headed for the nearest Australian territory, Ashmore Reef.

They got lost, had five days with little water and less food, and for a moment were delighted to make any landfall, even the Indonesian island of Sumba where they ended up.

While they were still recovering they came to realise any prospects of another attempt were gone, not because their money was spent but because of the denial of entry of the Tampa and the new legislation to keep people like Mohammed away from Australian shores. They knew then that things had changed.

Mohammed and his friends are still bitter about Australia and how they were shut out. "John Howard would only slap refugees," one said. But they also accept that, for people like them, the government's new policy has put Australia off limits forever.

"We don't want to go to Australia now because the Australian Government won't accept refugees or asylum seekers," said Mohammed, his friends nodding in agreement.

Australia has become just too hard; too hard to get a boat, too hard to get ashore and, most of all, too hard to stay in.

Instead they are waiting for the United Nations to classify them as refugees, and waiting then to be included in the refugee quotas of any country that might take them. "It's not important for me where -- I want education and to make my future," Mohammed said. Last week the International Organisation for Migration flew from Jakarta to Karachi 21 Pakistanis who came to Indonesia last year to find a boat south but have now given up hope of ever making Australia home.

The IOM, which has responsibility to feed, clothe and provide medical care for such "irregular migrants", has repatriated 244 Afghans and 47 Pakistanis since May, and now has only about 700 people in Indonesia still under its care, with numbers falling steadily.

According to the IOM, no boats have been organised by people smugglers coming to Indonesia since the Australian Government acted last year. And although it keeps in close touch with the Indonesian police, it is unaware of any people smugglers still operating in Indonesia.

As the IOM's head of office in Jakarta, Richard Danziger, put it: "Clearly the message has gotten across -- the door to Australia is closed." The Jakarta office of the UN Commissioner for Refugees agrees. "In my opinion the asylum seekers are reconsidering because Australia is a more difficult country to enter," a spokeswoman said.

Brigadier General Jacky Ulli, police chief in Kupang in West Timor, said there were no more boat people in his town. "They are not interested in using Indonesia as a transit point any more, maybe because Indonesia now is very stern." After Tampa, the Australian embassy worked hard to convince fishermen, port authorities and police that smuggling people to Australia was a quick way to prison. They held meetings, produced leaflets and even printed T-shirts to get their message across.

Australia's ambassador to Indonesia, Ric Smith, said news of the change in Australia's policy spread quickly in Indonesia, but it was arresting people smugglers that really destroyed trade.

In a country where police are bribed daily for the price of a cheap meal, convincing the Indonesian authorities to arrest people smugglers is no small achievement.

30-year-old mass grave found in East Java

Straits Times - August 26, 2002

Jakarta -- Dozens of human bones have been found in a 67 metre deep hole in a village in East Java.

Residents of the Lorejo Village were aware of the presence of the human remains for more than three decades but chose to stay silent, Kompas daily reported yesterday.

"In 1968 there was a pungent smell arising from the pit and from the stories told by the old folks, more than 70 bodies have been dumped there," said a villager. He added that the residents had decided to cover the hole, which they call Rat Cave, with rocks and not report it to the authorities.

The site lies on land belonging to a local NGO, Foundation for Peace. It re-opened the hole and began an investigation on August 11 to identify the remains. But the investigations were halted, pending approval from the authorities.

Many villagers said they suspected the bones belonged to Indonesian Communist Party members and sympathisers.

Environment

Can't see the trees for the smokescreen

Laksamana.Net - August 29, 2002

There are worrying signs that Indonesia's timber barons are trying to accelerate their destruction of Indonesia's last remaining forests.

In a series of underhanded campaigns, the tycoons are posing as conservationists in order to increase their profits and productivity.

In the latest example of this brazen guile, the Indonesian Forestry Society (Masyarakat Perhutanan Indonesia -- MPI) announced Thursday it will provide 100 billion rupiah ($11.25 million) to help the government curb timber smuggling and protect the environment. Good news? No! It's a ruse. It's an effort to increase destruction of the environment.

Beware of the MPI, which was led from 1991-98 by one of the greatest rapists of Indonesia's forests, ex-president Suharto's former golfing buddy and trade minister, Mohamad "Bob" Hasan, who is now supposedly serving a six-year jail sentence for fraud and misuse of reforestation funds. But more on Bob later.

The MPI says it will only give the 100 billion rupiah to the government if plywood exports reach 6 million cubic meters and the global price of plywood averages $400 a cubic meter.

Why have these strings been attached? The MPI is upset that the government plans to license logging companies to cut down "only" 6.7 million cubic meters of wood next year.

Therefore the MPI is urging the government to allow logging firms to cut down a minimum of 12 million cubic meters of timber in 2003.

In return for that, the notoriously corrupt government will receive the 100 billion rupiah -- supposedly for combating timber smuggling. Yeah, right. Even if the government ever does go after the kingpins, the corrupt timber barons should have no problem paying off crooked courts to ensure they avoid punishment.

Experts reckon about 80% of all logging in Indonesia is illegal and say the problem will take years to overcome, by which time there won't be much left of the forests.

The World Bank is no longer involved in forestry projects in Indonesia because the military, police and local governments have extensive financial interests in them. Foreign aid groups also complain that funds for forestry conservation projects are liable to be misused by officials who inflate prices.

MPI chairman Sudradjat Djaja insists his organization is interested in conservation -- which is absolute nonsense, given that he's demanding the government double the amount of logging concession areas.

What's more worrying is that he said the MPI intends to raise its 100 billion rupiah payment to the government by asking that timber firms set aside $2 from the export of every single cubic meter of plywood.

Sound familiar? It should. This is harking back to what happened when Bob Hasan was the self-styled King of the Jungles and controlled the timber industry.

It worked like this: the timber products sector was organized into various industry organizations and marketing boards. Market access and exports were tightly controlled by the boards, which also allocated market share. These industry associations made policy decisions that were almost always approved by the relevant subservient government ministries. Membership in the organizations was compulsory and all members had to pay annual fees to finance the "expenses" and "promotion costs" of the marketing boards. And at the top of all of these associations was Bob Hasan.

The main organization in Hasan's forestry fiefdom was the Indonesian Plywood Association (Apkindo), which flooded overseas markets with quality plywood sold far below world market prices. With Apkindo's control over export licenses, plywood companies had to follow the cartel's orders or face serious consequences. Little wonder that by the early 1990s, Apkindo had captured about 75% of the world trade in tropical plywood.

Critics say that Hasan collected a tidy $2.04 billion from commissions, promotion funds, and trading monopolies on plywood products, as well as an estimated $8 billion from saw milling, timber products, pulp and paper products, as well as monopolies on insurance and aerial mapping.

Under pressure from the International Monetary Fund at the height of the regional economic crisis of 1997-98, the Indonesian government in February 1998 revoked Apkindo's monopoly.

But Apkindo and its affiliates merely took a step back and are now doing their best to regain total dominance of the plywood trade. And they are doing this by claiming they want to protect the nation's forests.

Apkindo chairman Martias on June 10, 2002, announced that a special organization, to be called the Production Control Body (BPP), would soon start operating to monitor plywood production, exports and prices -- all for the sake of protecting the environment and increasing profits.

Likewise, MPI chairman Sudradjat Djaja said that illegal logging must be halted -- for the sake of pushing plywood prices up from the current $280 a cubic meter to $400 a cubic meter. What he means is that timber barons want to reassert their stranglehold on the industry. And presumably these tycoons won't care whether their timber comes from legitimate concession areas or elsewhere.

A study by the Center for International Forestry Research (CIFOR) reveals that in the mid-1990s less than 50% of the timber sourced by 33 large-scale timber companies came from their official concession areas. The rest of it sure didn't drop out of the sky.

But without a trace of irony, Djaja said wood smuggling activities in the forests must be dealt with seriously.

Djaja is no fan of the Forestry Ministry, which he feels is hindering the growth of the timber sector because it dares to impose limits on the amount of logging. In May 2002 he accused Forestry Minister Mohammad Prakosa of gradually "killing" the national timber industry.

The timber tycoons have found an ally in the form of Trade and Industry Minister Rini Suwandi, who on August 19, 2002, gave her official backing to the creation of a "new agency to help resolve the various problems facing the country's ailing forestry-based industry".

State news agency Antara quoted Suwandi as saying one of the agency's main jobs would be to help curb illegal logging. This pap was dutifully reprinted in the widely read The Jakarta Post daily.

What the media has not reported (until this report) is the revealing minutes of the meeting held by the Trade and Industry Meeting on August 19. The minutes state that the proposed agency will have three goals.

First, the agency will function to increase forestry product exports. As for the second and third goals, they're just a deceptive veneer, claiming that the agency will support the creation of local jobs and protect the environment. The agency's main function will be to increase logging.

The minutes also state that the agency will be financed through the obtainment of a "security fee" imposed on timber companies -- ostensibly for the purpose of fighting illegal logging.

Furthermore, the minutes say the agency will be chaired by two executives from the Forestry Ministry and Trade and Industry Ministry, while membership of the board will be open only to executives of Apkindo and related logging organizations.

What's this all about Minister Rini Suwandi? You're creating an agency that you claim will protect the environment, but representatives of genuine conservation groups and other non- government organizations will not be allowed to join? Why not just come clean and admit that you're helping out Bob Hasan and his cronies? Never forget that Suwandi is a long-time friend of Hasan. So much so, that when he was running automotive giant Astra, he hired her in 1998 to be the company's chief executive.

Anyone who thinks that Hasan is out of the timber business has sawdust in their head.

Detailed studies by CIFOR consultant David Brown, who also advises the Forestry Ministry, reveal that 18 of 35 offshore companies controlled by Hasan export plywood to the US, the UK, Japan, South Korea and elsewhere in Asia.

With the Trade and Industry Ministry now backing increased exports of timber products and "fee payments" from industry players, Hasan and his cronies will no doubt grow wealthier, while Indonesia's forests will suffer further.

Governor threatens offenders with jail as haze thickens

Agence France Presse - August 28, 2002

The governor of the Indonesian province of Central Kalimantan has threatened jail terms for people who set fires to clear land as haze thickened over the area and halted many flights, officials said.

Governor Asmawi Agani has issued a circular warning offenders they may face up to three years in jail, said provincial spokesman, Hadi, on Wednesday.

Visibility around 10 am was just 200 meters and face masks were handed out in the streets as people gasped for breath. "We have been given face masks by the Indonesian Red Cross and it is also handing out free masks on the streets," Hadi said.

Idris Sartono of the meteorology office in the provincial capital Palangkaraya said winds were too weak to disperse the haze and rains were not due before late next month.

"To be frank, this condition may well last until at least the end of the year as we are not sure whether the rains would begin to fall in late September as forecast. Last year they came much later," said Sicay Singam, a local environmental official.

He said the air pollution had "long been way over the danger level," adding that the air has been a health hazard for about two weeks.

"Even in the nights breathing is difficult and painful but I think people get used to this as this now occurs almost every year," Singam said.

He said the current conditions were not as bad as in 1997/98 when disastrous fires in Kalimantan and Sumatra island blanketed the region with haze for months.

The government has banned land clearing by fire since 1999 but prosecutions are vry rare.

Merpati Nusantara Airlines on Monday temporarily halted all flights to and from Palangkaraya. An official said they would try partially to resume operations on Thursday.

In the town of Muarateweh 180 kilometers northeast of Palangkaraya, the situation was only slightly better. Visibility was around 400 meters and there had been no wind for the past five days, the local meteorology office said.

In Sampit, 110 kilometers southwest of Palangkaraya, visibility was below 1,000 meters in the early morning but winds from the sea usually cleared the sky by 8 am, weather officials said.

Haze expected to shroud SE Asia until November

Reuters - August 27, 2002

John O'Callaghan, Singapore -- Southeast Asia will suffer more dry weather and smoke from fires in Indonesia before monsoon winds offer a reprieve in November, environmental officials in Singapore said on Tuesday.

Forest fires and slash-and-burn land clearing on the islands of Sumatra and Borneo, compounded by low rainfall from the return of the El Nino weather phenomenon, have cast a haze across the region for more than a month. In 1997 and 1998, smoke from raging fires spread to neighbouring Singapore and Malaysia and cost regional economies $9 billion in damage to farming, transport and tourism.

Singapore's National Environment Agency said even though El Nino this year was relatively weak, haze could hang over the region until October as dry weather stokes more fires.

"We can expect some increased occurrence of forest fires," Wong Teo Suan, deputy director of services at the agency, told a news conference. "But it will not be like the 1997-98 condition." The agency said recent satellite photographs showed more than 800 hotspots on Borneo, a giant island shared by the Indonesian region of Kalimantan, the sultanate of Brunei and the Malaysian states of Sarawak and Sabah.

"Although there were showers in some parts of Sumatra and Borneo over the last two days, the showers did not reduce the number of hotspots much," it said in a statement.

"Wetter weather conditions are expected in the region at least in the first half of this week. But less rainfall is predicted for southeast Kalimantan and southern Sumatra, so these areas are expected to have moderate to thick smoke haze." WIND AND RAIN The fires should ease when prevailing winds now blowing from the southwest shift to the northeast in November, said Loh Ah Tuan, the agency's director-general of environmental protection.

"The northeast monsoon period usually brings about a lot of rainfall, so it's less likely to have any fires," he said.

The two days of heavy rains in Borneo helped lift a shroud of smoke choking residents, but exhausted emergency crews continued to battle some of the hundreds of blazes.

An official from Merpati Nusantara airlines told Reuters on Tuesday the carrier had suspended service to the Kalimantan cities of Pontianak and Palangkaraya for a week due to the haze.

Merpati's flights are scheduled for the morning when smoke is thickest, which can mean delays and cancellations that tie up the airline's limited equipment. The environmental problems have also cut demand for seats, reports said.

While skies over Singapore generally have been clear and sunny, the pollution index has crept over the line between "good" and "moderate" several times this month.

Readings were expected to worsen slightly in September and October but still fall far short of the sustained "unhealthy" levels in 1997 when smoky clouds shrouded the city state.

Skies above Kuala Lumpur were hazy on Tuesday, although far clearer than in mid-August when haze enveloping parts of peninsular Malaysia cut visibility to as low as 1.5 km from the normal 10 km near the capital.

The dry season makes it easier for plantation fires to spread out of control. The region also has large deposits of peat that allow the fires to smoulder even after flames are doused.

Conservationists have long criticised Jakarta for failing to protect its natural resources but Indonesia has said the country's laws are too weak to deal with the problem.

[With reporting by Karima Anjani in Jakarta and Patrick Chalmers in Kuala Lumpur.]

NGOs join hands to tackle fire troubles

Straits Times - August 26, 2002

Robert Go, Jakarta -- Fed up with Jakarta's inability to control haze-inducing fires and to help residents of two provinces smothered by smoke, environmental groups are taking matters into their own hands.

Nineteen non-governmental organisations -- part of the Indonesian Forum for the Environment (Walhi) -- have decided to mobilise emergency aid and sponsor longer-term fire prevention initiatives against haze.

The NGOs, from Central and West Kalimantan provinces, will tomorrow launch a new campaign to donate masks, drugs and other aid to people who have been besieged by rising plumes of smoke in recent weeks.

Mr Longgena Ginting, the executive director of Walhi, which is an umbrella organisation of over 540 local groups nationwide, said citizens had to take action after the government had proved incapable of doing much.

He told The Straits Times: "The government, at best, has been incompetent. It fails year after year to address the root issues behind the fires. When the situation becomes an emergency like this, all it can do is pray for rain. That is not good enough."

Volunteers and environmental activists from all over the country are to collect donations, including money, masks, drugs, food and other aid items, which are then to be sent to and distributed in fire areas.

Walhi is also beginning a public awareness campaign to encourage farmers and residents to not only cease starting fires to clear land, but to also take part in an early detection and fire- fighting system.

According to satellite data, there are more than 10,000 hotspots across Indonesia, including in Aceh, North Sumatra, Riau and Kalimantan provinces.

Brunei, Malaysia and Singapore have suffered from the problem as well as strong winds have carried smoke and haze towards the north.

But the real emergency, say experts, remains in Indonesia, where as many as four million people are now surrounded by smoke, and face disruptions to their daily lives and several serious health hazards.

Schools have had to close their doors, airports have rerouted or delayed incoming and outgoing planes, and clinics have reported an increase in the number of people seeking treatment for various respiratory, lung and eye problems.

Mr Ahsan Hamidi, coordinator of Walhi's emergency management programme, said: "Lots of people are suffering now. The health threat is very serious and the government cannot take care of this problem. So NGOs now have to fill in."

The focus, however, is not only on the short-term emergency problems posed by the fires. Critics say that the government makes a big issue out of the problem only after the fires have already taken hold and become a major disaster.

Agencies and security officials do not establish good forest and plantation management policies, or enforce existing anti-burning regulations.

NGOs, according to activists, will instead work to convince local people that burning has severe and harmful consequences that hurt local communities.

Mr Longgena said: "We have to nip the problem in the bud. People need to stop burning, and to help the authorities spot fires and take care of them before they spread. We hope that our educational initiatives will help develop such an awareness level, and take care of the haze problem for good."

Rains relieve haze in parts of Indonesia

Straits Times - August 25, 2002

Jakarta -- Schools reopened and residents went without masks in parts of Kalimantan and Sumatra yesterday as rain cleared smoke- filled skies that had hung over the region during weeks of raging forest and brush fires.

Officials in West Kalimantan said the haze had lifted, allowing students to return to schools that had been shut because of the smoke.

"Things are getting back to normal," said Mr Supriandi Prakirawan of the meteorology agency in Pontianak, West Kalimantan. "Visibility has improved because it has been raining since last night." He said the number of fires had been steadily dropping in Kalimantan since Wednesday and visibility had improved from 200 m to 5,000 m.

Rains also brought much-needed relief for residents of Pekanbaru, the capital of Riau province on Sumatra island.

But Mr Drajat Bintoro, a meteorology official, said visibility in that part of Indonesia was still only 700 m, although schools were open again and the airport reported no delays.

Environment Minister Nabiel Makarim said on Thursday that Malaysia, Thailand and Singapore had complained at the smoke haze blowing over their countries.

He described the problem as serious and said that while the current fires were smaller than in 1997, they were difficult to handle because some were in peatland and difficult to douse.

Officials have said the government lacks the manpower and money to prevent the fires. Jakarta has done nothing to fight the fires but has said it will cover cost overruns incurred by local governments in fighting the blazes.

Health & education

Indonesians have no qualms about buying fake degrees

Straits Times - August 25, 2002

Robert Go, Jakarta -- Indonesians are crazy about academic degrees and will spend money to get fake ones, prompting top educators and politicians to suggest a crackdown against those who sell or buy such accreditations.

A draft education legislation now before Indonesia's parliament includes provisions which prohibit the sale of fake academic degrees, and promise fines of up to one billion rupiah and one- year jail terms to those caught doing so.

Mr Muhammadi, a legislator from the National Mandate Party (PAN), says fake degrees mislead the public and degrade the reputation of Indonesia's education system.

The Kompas daily quoted him saying: "There has to be criminal sanctions for those guilty of selling or buying fake degrees. This issue has considerable effects on the national education system."

Real academics at some of the most prestigious universities agree that the government needs to act against officials and bureaucrats who seek instant degrees, as well as those peddling them for as low as US$200. Prof Martani Huseini, head of University of Indonesia's Sociology and Political Science department, said: "What's the use of having a degree if one is not qualified and has no real knowledge?" Many Indonesians admit openly that they have no problem with spending money for the right to insert Dr or MBA alongside their names.

A top bureaucrat at a Jakarta municipal agency who admitted to The Sunday Times that he bought a fake doctorate for around US$1,200, said: "I did it to advance my career. Since I bought it in 1996, I have been promoted twice already." The Straits Times also reported the rise in the number of "instant lawyers", who spend no time in classrooms and practise law after passing only one test, in Indonesia.

Mr Rizal Sutedjo, who is pursuing a medical degree at Trisakti University in Jakarta, said there is nothing wrong with buying fake degrees, as long as people do not go on to practice in that field.

"I don't think people should do it with medical degrees, or in fields that could put them in situations where they hold other people's lives in their hands." The practice annoys those who have spent years acquiring expertise and accompanying degrees, like Dr Martani. He and his colleagues have some suggestions to make people less degree conscious.

First, any degree listed in job applications should also include the name of the institution that granted it. Second, people should not list their qualifications in name cards or other official documents.

In the meantime, academics argued, as long as the practice is not prohibited, fake degrees would proliferate.

US$2,000 for his 'Dr' Vice-President

Hamzah Haz is the most prominent example of a high-level official who has acknowledged openly, in published interviews, to having paid for his title of 'Dr'. His degree from the American World University reportedly cost US$2,000 in 1998.

Armed Forces/Police

TNI chief tells servicemen not to vote in 2004 election

Jakarta Post - August 31, 2002

Tiarma Siboro, Jakarta -- Less than three weeks after lawmakers agreed to scrap the military and police's free seats in the House of Representatives (DPR) and the People's Consultative Assembly (MPR) by 2004, Indonesian Military (TNI) chief Gen. Endriartono Sutarto has urged his troops to shun the next general election.

Speaking during a press conference held at TNI headquarters in Cilangkap, East Jakarta, on Friday, Endriartono said he would tell his soldiers not to exercise their right to vote in the 2004 election for fear that they would be overly influenced by the country's political parties.

"I realize that the right to vote is a basic political right for all citizens, including soldiers. But since the country has failed to show political maturity, I'm afraid the election would affect my soldiers, who lack political experience," Endriartono said. "I will request soldiers not to exercise their political rights in the 2004 general election," he asserted.

In the fourth and last round of constitutional amendments earlier this month, the country's highest legislative body, agreed to change the components of the MPR by 2004 into the House and the Regional Representatives Council (DPD), with all members being elected.

The amendment will effectively scrap the military/police faction both in the House and the Assembly, whose members are all appointed by the their respective institutions.

Days before the MPR was due to convene for its annual session, which was expected to put the final seal to the latest round of constitutional amendments, Endriartono and other military leaders called for a return to the original text of the 1945 Constitution, arguing that the amendment process had gone too far.

A return to the 1945 Constitution would mean annulling all the amendments made so far to the antiquated constitution, with the result that the military and police would keep their seats in both the DPR and MPR.

National Institute of Sciences (LIPI) military observer Ikrar Nusa Bhakti questioned Endriartono's remarks, saying that as the TNI chief, the four-star general had announced his political stance despite repeated pledges to stop the institution from engaging in day-to-day politics.

"Instead of asking his soldiers not to vote, Endriartono must order TNI leaders to avoid political meetings with political parties ahead of the general election," Ikrar told The Jakarta Post on Friday.

According to Ikrar, Gen. Endriartono and other high-ranking military officers must not show their political preferences to soldiers as this would mean an abuse of power. "And for the soldiers, Endriartono must order them to restrain themselves from expressing their political preferences to other people before, during and after they cast their votes," Ikrar said.

The House is currently deliberating the electoral bill, which, among other things, grants military and police personnel the right to vote.

TNI leaders have voiced objections to the bill, arguing that allowing security personnel to exercise their voting rights would ruin the esprit de corps of the military. They have also asked for some time to effect internal consolidation prior to soldiers being allowed to exercise their rights.

The last time soldiers were allowed to vote was in 1955, which saw the military backing different political parties.

With the establishment of the New Order regime, Soeharto banned the military from actively participating in elections and instead granted it free seats in both the House and the Assembly.

But the dominant role of the military during the New Order prompted people to demand that it give up its political role.

According to Ikrar, Endriartono's call showed that he was unsure if soldiers could cope with exploitation by political parties.

"As TNI leader, he has no right to veto the rights of soldiers. And his statement today [Friday] has only served to reveal his confusion," Ikrar said.

He also criticized Endriartono's statement that the country's civilian leaders lacked political maturity. "Instead of blaming the institution and himself, Endriartono is simply pointing the finger at the civilian politicians," said Ikrar, adding that two years was long enough to prepare military personnel for the 2004 general election.

International relations

Rein in the troublemakers, Kuala Lumpur tells Jakarta

Straits Times - August 28, 2002

Brendan Pereira, Kuala Lumpur -- Malaysian politicians yesterday asked the Indonesian government to rein in troublemakers in Jakarta or face the prospect of a more trying period in bilateral relations with its Asean neighbour.

Implicit in the message was the point that Indonesia had more to lose if the current spat became worse.

Foreign Minister Syed Hamid Albar said that Indonesia should ensure that Malaysians in the republic were safe from any threat and that there was no repeat of the flag-burning incident.

"We hope that the Indonesian government can take measures -- don't let people worsen the situation between the two countries," he said.

Relations between the two neighbouring countries hit a rough patch on Monday after a small group of Indonesians protested at the Malaysian Embassy and set fire to the Malaysian flag to show their anger over the Mahathir administration's tough stance against illegal foreign workers, who were mainly Indonesians.

Datuk Syed Hamid said that the burning of the national flag was not the way to conduct international relations and warned that such actions would harm longstanding bilateral ties.

He said: "We should not be guided by emotions in dealing with international relations. In this matter, the Indonesian media and its leaders should play an important role by not taking an anti- Malaysia stand."

While some Indonesians might be upset with the Mahathir administration's decision to impose jail and whipping on illegal immigrants, they should not forget one important fact: There were a lot of Indonesians working here, he said.

He also clarified that his advice on Monday to Malaysians against travelling to Indonesia did not mean that they were barred from doing so.

"Let me make this clear, we are not saying Malaysians are banned from going to Indonesia, but go there only if you have important things to do. I think in this kind of situation, there will be people taking laws into their own hands, they have to think about Indonesians working here as well," he said.

Meanwhile, Prime Minister Mahathir Mohamad said Malaysia would not lodge a protest with the Indonesian government over the burning of the national flag. He said that there was no need for the country to react because the act was not the work of the Indonesian government but of a small group of people.

"There are 220 million people in Indonesia and from that number there will surely be a small group who are irresponsible. We should not respond to these people," he said yesterday.

He said he agreed with the statement by Datuk Syed Hamid that for the time being, Malaysians should not go to Indonesia unless it was absolutely necessary.

Checks by The Straits Times with four travel agents showed that there had been some cancellations for tours departing this week following the Foreign Minister's advice. There were also many calls from people who wanted to know the actual situation in Jakarta.

Said Ms Rachel Tee, an executive at Mansfield Travel: "Some cancelled due to the uncertain situation. I don't think things are that serious but their personal safety could be involved. So why risk it."

Economy & investment

The dilemma IBRA faces in resolving bad loans

Jakarta Post - August 28, 2002

Vincent Lingga, Jakarta -- Raising revenues for the state budget is only one of the objectives of the Indonesian Bank Restructuring Agency's (IBRA) massive auction sale of Rp 135.4 trillion (US$15 billion) in bad loans which began last month, and not the most important one for that matter.

Releasing the thousands of corporate debtors from the bondage of their bad debts and putting them in the care of bank creditors that are capable of restructuring the dud loans and refinancing and restoring the corporate debtors to sound operations is much more important for economic recovery.

Still equally crucial is the need for improving banks' intermediation through the expansion of their loan portfolios to reduce their dependence on the interest revenues from government bonds, which were issued in 1999 to recapitalize almost all the largest national banks in the country.

Recapitalized banks were facilitated to acquire the bad loans by allowing them to pay the distressed assets with government bonds and to ally with non-bank finance companies to manage and restructure the bad loans into current credits before they were put into banks' loan books.

This way, the banks would not risk their capital adequacy ratios falling below the minimum 8 percent level and, at the same time, would allow the government to retire its bonds early, thereby decreasing its debts and the amount of bond interest that it has to pay annually. Unfortunately, though, the objectives of reinvigorating indebted corporations and creating sound businesses through restructuring and refinancing, as well as early retirement of sizable amount of government bonds could not fully be achieved.

Because only around 50 percent of the assets sold were bought by banks and securities/investment companies that teamed up with banks, while the rest were acquired by small investors, which would most likely be incapable of restructuring the loan assets and refinancing the debtors' businesses.

Only Rp 4.46 trillion of the Rp 23.1 trillion sale value was paid in government bonds. The auction succeeded in selling only 1,454 loans worth (principals only) Rp 81.6 trillion out of the 2,582 loans with a face value of Rp 135.4 trillion. It succeeded in raising Rp 23.1 trillion, or a recovery rate of just 28.3 percent.

That reflected a 71.7 percent loss or about equal to the 72 percent loss in the value of the rupiah in relation to US dollars.

This also meant the debtors got discounts averaging more than 70 percent of their debt principal or a total of Rp 58.5 trillion. This was part of the cost of the economic crisis that the taxpayers now are burdened with. The latest data shows that there is still more than Rp 189 trillion in bad loans at IBRA that have yet to be restructured or sold off.

There were several reasons as to why the results of the mammoth loan asset sale were way below expectations.

Chief among them was the inadequate information available on the bad loans that made most bidders unable to reasonably assess the commercial viability of the loan assets and to estimate the return on their investment.

IBRA seemed unable to disseminate complete information on so many loan assets, or it did not have, in the first place, adequate information or proper legal documentation when those debts were dumped into its hands at the height of the banking crisis in 1998 and 1999.

On this information factor, Bank Mandiri, a new bank set up in 1999 as the result of the merger of four state banks, appeared to have been in a very advantageous position because it was these former banks that supplied around Rp 178 trillion of the Rp 292 trillion in bad loan assets taken over by IBRA from closed, nationalized or recapitalized banks in 1998 and 1999.

Another reason, as disclosed by an informed source, was that many of the corporate debtors were rotten businesses that did not have any chance at all of surviving, even with generous refinancing packages.

Still another factor was that many loans were not adequately secured with collateral, which was not uncommon before 1997, especially among state banks that were highly vulnerable to political pressure and rife with corruption.

These rotten businesses were companies which had thrived only because of the special privileges and facilities they got under Soeharto's authoritarian rule that was notorious for collusive practices between officials and particular businesspeople.

IBRA should have liquidated these corporate debtors in the first place, using its extrajudicial powers, as stipulated in Government Regulation No.17. 1999, instead of wasting its resources trying to restructure them, let alone offering them to other creditors or investors.

After all, IBRA's tasks are not only to restructure bad loans and recover distressed assets. Equally important is the job of consolidating the corporate sector, cleansing of all rotten enterprises and unsound business practices.

Allowing these unfeasible corporate debtors to survive would be unfair competition to sound companies which have worked hard to settle their debts, especially if these bad debtors can get discounts of up to 70 percent of their debts.

Another problem IBRA discovered, after being discouraged by one defeat after another at the Jakarta bankruptcy court, was that it was hopeless to deal with the largely incompetent and corrupt court system.

IBRA is therefore faced with a dilemma. In view of its past record of being able to restructure less than 100 debts a year, IBRA may take more than a decade to work out the thousands of bad loans still under its management, much longer than its mandate which will expire in early 2004.

Moreover, the longer the bad loan assets stay under IBRA the worse will be the quality of the assets.

Conducting another massive auction of both restructured and un- restructured loans as it did last month would risk giving away commercially viable and rotten businesses to unscrupulous debt collectors and serious, yet under-capitalized investors which would not have enough resources to restore corporate debtors with promising businesses to sound operations.

High-level political resolve and decisions are required to resolve the dilemma.

Instead of constantly criticizing IBRA as an incompetent and corrupt institution, it is high time for the House of Representatives to help the government further empower IBRA to dispose of corporate debtors that no longer have business prospects.

Quickly disposing of corporate debtors with rotten businesses would not only clean up the economy of "zombie" enterprises but also would enable IBRA to focus its attention on restructuring loan assets backed by good business prospects and disposing them at a reasonable recovery rate.

Investment approvals down

Reuters - August 27, 2002

Jakarta -- Indonesia's foreign direct investment approvals dived to $2.67 billion in the first seven months of 2002 from $5.55 billion in the same period last year, government figures showed on Tuesday. The drop was in line with analysts' expectations.

State investment agency BKPM said in a report the biggest investment approvals for this year -- worth $564.6 million -- were in the transportation, warehousing and telecommunications sectors.

The potential export value arising from the proposed total investments submitted during the period was $2.56 billion compared with total annual exports of some $55 billion.

BKPM also said domestic direct investment approvals fell to 13.7 trillion rupiah ($1.5 billion) in the 2002 period compared with 43.8 trillion rupiah in the year ago period. Investors reduced their exposure to Indonesia after the country plunged into political and economic turmoil in the late 1990s and have remained wary ever since.

Analysts have said improving the investment climate was critical as it would not be sustainable for the country, hard hit by the Asian financial crisis of the late 1990s, to continue relying too heavily on domestic consumption, currently the main factor driving economic growth.

Indonesia's economy grew 3.32 percent last year and the state budget forecasts growth of four percent in 2002 and five percent next year, but many economists say the country may fail to meet the targets as long as investment remained weak.

Indonesia's economy needed to expand at least six to seven percent annually to be able to provide revenue to pay off old debt and avoid the need to seek more help from creditors to stay afloat, economists have said.

The combined foreign and domestic debt stands at some $150 billion, almost equal to gross domestic product.

Investment, growth prospects remain gloomy

Jakarta Post - August 27, 2002

Vincent Lingga, Jakarta -- Most analysts view the government's estimate of 5 percent economic growth for 2003 as too optimistic since consumer spending, one of the biggest locomotives of economic expansion besides export, is expected to slacken as a result of the contractible fiscal policy, while foreign investment will likely remain moribund.

Private spending will decrease along with a decline in consumers' disposable income as the government will extract more than what it will inject into the economy through a vigorous tax collection, the addition of services subject to value-added tax and a higher property tax rate.

Nevertheless, the government seems confident that favorable macroeconomic conditions, supported by the stronger political stability, will be conducive for bolstering export and investment in order to offset any decline in the contribution of consumer spending to growth generation.

This confidence can be seen from the budget projection, which more than doubles the target of export growth to 7 percent next year from the estimated 3 percent increase this year.

However, this projection seems too high as the latest indicators from the world's economic powerhouses, the United States, Japan and Europe, portend a lower economic expansion for next year.

Moreover, the increasingly radical labor movement has made many importers overseas worried about the ability of Indonesian companies to deliver such fashion-sensitive goods as footwear, textiles and garments, and are consequently shifting their orders to other countries.

Worse still, the manufacturing sector could encounter keener competition from the import sector as more goods from neighboring countries, such as Thailand, Malaysia and the Philippines, may inundate the domestic market under the ASEAN Free Trade Area beginning in January.

Investment spending, which is expected to be the third source of fuel for growth, is not promising either. Not only will the government's investment in development spending decrease by 5 percent in real terms, but it will not provide much stimulus for private investment as only a very small portion of the spending will go to the development or maintenance of physical infrastructures.

The bulk of the public sector's investment will be allocated to poverty alleviation and public welfare programs, such as education, health and housing.

Certainly, the majority of foreign investors will most likely remain on the sidelines, waiting for a significant improvement in law enforcement, a business-friendly stance on the part of regional administrations and less rigid labor regulations.

Moreover, the manufacturing sector does not provide much opportunity for green-field investment projects as it still operates below its designed capacity. Resource-based ventures, such as mining, fisheries, plantations and other agro-based industries, which are supposed to be the most prospective businesses, are rendered unfeasible due to the hostile regulatory environment caused by the excesses of the start-up process of regional autonomy.

Domestic investment is out of the question because many businesses remain hostage to bad debts, the condition of the banking industry is still fragile and interest rates are persistently high.

The budget estimates the central bank's benchmark interest rate at an average 13 percent compared to 16 percent this year. This means lending rates will range from 18 percent to 20 percent because national banks continue to be inefficient with intermediation costs varying from 5 percent to 7 percent.

Is the prospect for higher growth really so hopelessly grim? Not necessarily, if the government and regional administrations are fully aware of the exigencies of the situation and set the right priorities accordingly, while improving cooperation and coordination.

Domestic investment, for example, continues to be commercially feasible and is, in fact, sorely needed to modernize plant machinery and equipment to diversify products into higher value- added goods and to improve competitiveness. This would only be possible if resource-based businesses, such as wood, fisheries, mining and plantations, are released from the prison of their debts to reopen their access to new credit lines.

Likewise, foreign investors are still interested in coming in, but through the acquisition of business assets managed by the Indonesian Bank Restructuring Agency and of certain state companies.

Most important, though, is for the President or the chief economics minister to provide effective leadership for the top- priority programs that are most influential to bolstering export and investment.

The national political leadership also needs to go all out with effective communications to convince regional administrations of how vital a business-friendly environment is to attract investment, without which the regional economy will never expand to improve people's welfare.

IBRA finds itself in another mess for its loan sales

Jakarta Post - August 26, 2002

Vincent Lingga, Jakarta -- The Indonesian Bank Restructuring Agency (IBRA) seems not to be fully aware yet that credibility and accountability should be its basic capital in executing its primary task, which is disposing of the billions of dollars of distressed assets under its management.

Or is this agency, the most vital instrument for the economic crisis management, so fully controlled by corrupt officials that it is truly a den of thieves, as many have alleged? Almost all the major deals it has made since 2000 have been dogged by controversy, battered by allegations of collusion and corruption. This despite its supervision by an independent oversight committee, ombudsmen, an internal audit department and State Minister for State Enterprises Laksamana Sukardi, supposedly one of the Cabinet members with impeccable integrity.

IBRA's auction of Rp 135.4 trillion (US$15 billion) of bad loans last month, billed as the mammoth asset sale of the year, ended in another controversy, causing uproar in the mass media and forcing the government to set up a special task force to investigate allegations of conflicts of interest and corruption.

The auction process started in early June with steps to ensure a high standard of transparency. These steps included conducting an information campaign through investor forums and the IBRA website, and establishing clear-cut step-by-step procedures and legal safeguards to prohibit original debtors from taking part in the bidding.

The massive asset sale was warmly welcomed, as it was expected to achieve three strategic objectives: releasing corporate debts from the IBRA "hospital" to new creditors, allowing banks to expand their loan portfolios and reducing the government's domestic debt and its spending on the interest on bonds.

About 231 domestic and foreign investors submitted bids, resulting in Rp 81.6 trillion in bad loans being sold for Rp 23.1 trillion, or a recovery rate of 28.3 percent. This rate was not bad, compared to the 20 percent recovery rate achieved by the asset managers in South Korea and 27 percent in Thailand.

But suddenly, boom! Allegations of collusion and corruption erupted, and rumors began to fly of several IBRA officials buying luxury cars.

As it turned out, a shareholder and key executive of PT Anugra Cipta Investama, one of the biggest winning bidders, is Wicaksono Abadiman, a cousin of Mohammad Syahrial, deputy to the IBRA chairman in charge of asset management. Yet more damaging to the credibility and perceived fairness of the auction is the fact that Abadiman is a former president of state-owned PT Bahana Securities, which together with another state firm, Danareksa Sekuritas, had been a financial adviser to IBRA and was heavily involved in valuing distressed assets at IBRA, including a good portion of the bad loans entered into the auction.

Why is this seemingly small matter so damaging to the credibility of the auction process? Because information is the key for investors to assess the business prospects of debtors, and to set their bid prices accordingly. It is quite obvious, therefore, that asymmetrical information is quite a big disadvantage.

Anugra Cipta should not have been allowed to take part in the auction, not only because Abadiman is a cousin of Syahrial, one of the key decision-makers at IBRA, but primarily because he was virtually an insider who had been well informed of many of the distressed assets put on sale. State minister Laksamana set a good example of good governance in May by deciding not to appoint his elder brother as the new president of state-owned PT Garuda Indonesia, even though Samudra Sukardi was the most qualified candidate for that position, judging by his technical competence, his managerial record and the full support he received from the state company's employees.

But this time, he did not intervene to prevent a conflict of interest.

Possession of information was naturally a great advantage, because quite a large portion of the bad credits being auctioned had not yet been restructured. Investors would still have to restructure the dud loans they bought, a process that would require formidable negotiations with corporate debtors about new terms, repayment schedules and even some refinancing packages.

Anugra Cipta enjoyed another huge advantage because it allied itself with Bank Mandiri, the country's largest bank, which was set up in 1999 as the result of a merger of four state banks. These now defunct banks handed over Rp 178 trillion of about Rp 292 trillion in bad loans IBRA took over from closed, nationalized and state banks in 1998 and 1999.

True, there is no regulation that bans the relatives of IBRA officials from taking part in transactions with the agency. But if IBRA is truly serious about maintaining a high degree of credibility, developing good governance and high standards of business ethics, it should have prohibited the relatives of senior officials with decision-making authority and those with inside information from doing business with IBRA.

IBRA never seems willing to learn from its past mistakes, including the alleged collusion-ridden auction of Indomobil, the country's second largest automotive group, last December.

A two-month investigation by the Business Competition Supervisory Commission earlier this year pieced together solid evidence showing that the three final bidders in that auction -- PT Alpha Sekuritas Indonesia, PT Bhakti Asset Management and PT Cipta Sarana Duta Perkasa -- conspired to determine the winner of the tender.

The evidence clearly described how two bidders, Alpha and Cipta Sarana, shared information and knowledge for their bids. This conspiracy, the commission stated, was made possible because Pranata Hajadi was an investor in both Alpha and Cipta Sarana.

It is sad to note that except for Bank Mandiri, most of the 20 largest winning bidders of last month's auction are investment or securities companies, with little capital and not much experience in debt restructuring, let alone refinancing capability.

The strategic objectives of bad loan sales can only be achieved if most of the buyers are banks, capable of restructuring the debts and refinancing the corporate debtors to enable them to resume full-capacity operations.

Given its messy image, IBRA might learn a lesson from Indian Minister of Privatization Arun Shouri, who also faces constant criticism from fellow ministers, trade unions and parliamentarians anytime he disposes of a state company. Yet in less than two years, Shouri has succeeded in selling 22 state companies, raising $2.2 billion.

As part of his overriding attention to maintaining the integrity and credibility of every deal he makes, Shouri goes the extra mile. Shouri turns over all documents to the Indian auditor general (the equivalent of Indonesia's Supreme Audit Agency) the day after each sale, even though he is not legally required to do so.

IBRA may also be well-advised immediately to hand over all documents to the Supreme Audit Agency after each major transaction, to prevent controversy and to uncover early on any wrongdoing that may have occurred.

Jakarta raises $4.4 billion from sale of bad loans

Straits Times - August 25, 2002

Jakarta -- Indonesia has raised more than US$2.5 billion from the sale of bad loans that it took over following the 1997-98 Asian financial crisis.

The loan sales move Indonesia's Bank Restructuring Agency a step closer to meeting its target this year of raising 42 trillion rupiah from asset and loan sales. Indonesia's Budget, already running a deficit equivalent to 2.5 per cent of its gross domestic product this year, is counting on this money.

Mr Syafruddin Temenggung, head of the Bank Restructuring Agency, said that 70 per cent of the buyers were local banks, asset management firms and securities companies. The remaining investors were foreign, although none were from internationally known investment firms, he said.

He said the loans were sold at about one third of their original value. Analysts suspect that many of the buyers are acting on behalf of the original debtors themselves.

The agency has come under fire for potential irregularities in the sale, including the sale of one loan to a consortium that included a relative of the agency's deputy chairman.

State Minister of National Development Planning Kwick Kian Gie has called repeatedly on the government to investigate the loan sale, and Parliament members have said that they plan to hold a hearing on the matter next month.

Indonesia set up the agency in 1998 to manage the assets and loans that the government took over following the collapse of the country's banking system.

The agency took over US$33 billion in bad loans, becoming the largest single creditor in the country.

Along with the loan sales, the agency has also been charged with selling off state-owned assets, including the sale of majority stakes in some state-owned banks.