Aceh

Aceh war in danger of flaring up again

Agence France Presse - April 13, 2003

Indonesia's longest and bloodiest conflict is in imminent danger of breaking out again, just four months after a peace agreement was signed to international acclaim.

The government last Thursday told troops to be ready to go back to war in Aceh within five days if necessary, unless disputes over the pact can be settled at a meeting of a Joint Council -- the final arbiter.

Separatist rebels said they would refuse to attend any meeting inside Indonesia and proposed Geneva. Mediators from the Henry Dunant Centre were frantically trying to get agreement on a date and venue. The accord to end the 26-year war in the energy-rich province on Sumatra island looks increasingly fragile.

"We might by some miracle get through the next five days," said Sidney Jones, Indonesia project director for the International Crisis Group, on Friday. "Even if we get that far I think the mood in government and cabinet and the public at large is 'Crush separatists'. It will be very difficult to get the process back to the negotiating table."

If the Free Aceh Movement (GAM) refuses to take part in a Joint Council meeting, Jones said, "it will be a green light to the army to go ahead -- the signal the army has been waiting for." Force has failed in the past.

"During the 25 years of the Aceh conflict, a military approach has always failed while a dialogue approach has not been proven to fail," media reports quoted analyst J. Kristiadi as saying.

Human rights activist Munir said a new military operation "will not produce anything but more civilian casualties." He said it was very possible conflict could be imminent.

Jones faulted both sides. During the first two months after the agreement, "GAM undertook 'in your face' rallies and went around using every possible forum to tell people this agreement was the first step to independence," she said.

The pact makes no mention of independence, which Jakarta implacably opposes. Both sides supposedly accept autonomy as a basis for further talks.

The rebels had regained control of the civilian government structure in a number of places at sub-district and village level and had been recruiting, Jones said.

The army for its part had been using its old East Timor tactics, she and other analysts said, by mobilising civilians to protest outside or attack offices of the Joint Security Committee which monitors the truce.

Monitors were withdrawn from field offices last week due to fears for their safety. Killings sharply increased, with 16 between Tuesday and Thursday.

Analysts said top security minister Susilo Bambang Yudhoyono is trying to fend off rising demands from the army and much of the public for a military operation.

"It's clear there were a lot of army objections to the idea of negotiating with the rebels -- Endriartono (armed forces chief Endriartono Sutarto) and Yudhoyono persuaded the military to go along," Jones said.

One way to get GAM to stop fighting could be to offer incentives to take part in the political process, Sinn Fein-style. But the government refuses to accept locally based parties.

A start by GAM in disarming could also reduce tension. "But it's got to a point they (GAM) will say that with the army out for blood, the last thing they will do is lay down their arms," Jones said.

At some level in the army there was a genuine concern that it was being denied its rightful role to defend the integrity of Indonesia.

The army is also trying to regain the dominating role it enjoyed for decades under Suharto.

The Aceh situation, said Jones, "is a heaven-sent opportunity to prove that only the army can deal with internal security problems -- even though they had a role in creating most of them." One problem, she said, is that the peace deal assumes the army and GAM actually want peace.

"Elements on both sides have an economic interest in a continuing conflict -- getting a cut from public works contracts, extortion on the roads, the marijuana trade, involvement in illegal logging." Of the estimated 10,000 deaths in the war, most have been civilians.

"Civilians will get caught in the middle where they always do," Jones said. "That's the real tragedy."

TNI must not repeat East Timor mistakes

Jakarta Post - April 11, 2003

Ardimas Sasdi, Jakarta -- The process of ending hostilities in troubled Aceh, which has been underway for the last five months, has entered a new, critical phase, which if not handled properly, could wreck the peace plan.

Two of the most worrying developments threatening to derail the peace efforts were an attack by an angry mob of 1,500, who ransacked and burned a Joint Security Committee (JSC) office in the East Aceh town of Langsa on Sunday, and the killing of nine rebels by the police and military in four incidents on Tuesday.

The JSC withdrew its peace monitors from the regencies to Banda Aceh on Tuesday following Tuesday's killings.

Sunday's incident was the second attack by a mob on a JSC office in less than one month. Last month, hundreds of people, whose identities are still unknown, attacked a JSC office in Takengon, Central Aceh, ostensibly over what the attackers' called the committee's failure to maintain impartiality.

The attack, which could be categorized as a criminal act, has the potential to ruin the peace process, which had been proceeding relatively well since the government and the Free Aceh Movement (GAM) signed a truce brokered by the Swiss-based non-governmental organization, the Henry Dunant Centre, in Geneva on December 9.

The JSC was formed by the HDC to supervise the implementation of programs to end the hostilities in Aceh. It comprises representatives from the Indonesian Military (TNI), GAM and international peace monitors, mostly from Thailand, a country viewed by both GAM and Indonesia as neutral.

In response to Sunday's attack, the HDC has asked the government to take the necessary steps to prevent similar incidents, and provide security for JSC members as all the JSC offices in Aceh's eight regencies have faced the threat of attack.

The attacks on the JSC have occurred after a drive by GAM to recruit new members as part of its campaign for independence, and the failure to meet the deadline to disarm as stipulated in the Geneva accord -- things considered by the military to be blatant breaches of the peace deal.

This view has toughened the stance of the TNI and police against GAM. The TNI is still the dominant force, at least as far as Aceh and GAM are concerned. The Army, for instance, held a meeting of its top brass in Lhokseumawe, one of the hottest spots in Aceh, a move seen by observers as a nothing less than a show of force.

The latest developments in Aceh, including the violations of the peace accord by both sides and exchanges of harsh words, have sparked concerns in many quarters.

Senior diplomat Wiryono Sastrohandoyo, the Indonesian government's chief negotiator with GAM, had earlier called on the secessionist movement to comply with the peace deal to avoid plunging the province back into a bloody conflict with the TNI, while a Golkar legislator from Aceh, T.M. Nurlif, urged the government and GAM not to abandon the peace agreement.

The December 9, 2002, peace agreement was seriously flawed from the beginning by GAM's refusal to renounce its 26-year-old armed struggle for independence. The road to peace between a government and rebels in any part of the world is not easy as evidenced by the ongoing talks between the Sri Lankan government and the Tamil rebels, which are brokered by the government of Norway and hosted by Thailand. Both Colombo and the rebels treaded lightly at the outset of the peace talks by discussing relatively uncontentious issues so as to ensure they would be able to move on to trickier issues during the later stages.

Most Acehnese, as reflected by the turnouts for the establishment of the new peace zones and their expressed wishes for the extension of such zones, support the existing peace process. The HDC, while not ignoring the violations, was also quite happy with the way the efforts to end the hostilities were proceeding.

In addition, the international community had also invested high hopes in the peaceful solution of the Aceh issue as reflected in the commitment of world organizations and a number of countries to take part in the reconstruction of basic infrastructure in the resource-rich province, such as the building of new schools, roads and irrigation schemes.

The future of the peace deal in Aceh will largely depend upon the political will of GAM and Indonesian government leaders.

The rebels, for instance, must forget their desire for independence, and instead accept Jakarta's offer of special autonomy, while Jakarta also has its work cut out for it so as to ensure justice for the Acehnese.

The military must shift from a heavy-handed approach to a more humane one in order to supplement concrete development programs in a bid to win the hearts and minds of the Acehnese. The military and police will also have to train their personnel in sociology, religion and communications, and tighten up the selection procedures for the officers who are to be sent to the staunchly Muslim province.

The military could also learn from the approach adopted by the former Dutch colonial government in Aceh to end the bloody conflict, which has claimed more than 10,000 lives. The Dutch at one time employed Islamic scholar C. Snouck Hurgronye to research an effective approach toward the Acehnese, who are known as simple but brave people who are immensely proud of their culture and religion. For them, respect is worth much more than wealth.

The military must also resist the temptation to take advantage of the fact that the world's attention is currently focused on Iraq by launching a campaign of uncontrolled violence to crush GAM as it did against the East Timorese following their decision to secede from Indonesia in a referendum in 1999. Should something like this happen again, it is unlikely it will be forgotten, if not actually forgiven, so quickly by the world community.

Evidence is mounting that the military intends to use force to try once again to exterminate the rebels. This may be gleaned from the statement made by Megawati ordering the police and military to prepare themselves for an anti-insurgency operation, and the preparations being made for the dispatch of a large number of additional troops to the province.

If the senior military leaders in Jakarta choose this path, they will be condemning themselves, as well as the younger officers who have no choice but to obey the orders of their superiors, and run the risk of some time in the future being hauled before an international court for crimes against humanity.

Amien Rais warns over future of Aceh peace pact

Radio Australia - April 10, 2003

Indonesia's President Megawati Sukarnoputri is facing the apparent unravelling of the peace pact in Aceh province. Just four months after the Government and GAM, the separatist Free Aceh Movement signed a peace deal, international peace monitors have been withdrawn to the capital Banda Aceh after their offices were attacked.

There has also been a renewed spate of violence. In the second part of this interview with Asia Pacific, Indonesian National Assembly head Amien Rais warns of possible 'East Timor' situation.

Transcript:

Rais: Aceh is very messy right now, even it's bordering to anarchy and unfortunately my government seems not to know what to do, while the people in Aceh are attracted to the ideas of GAM, to have referendums on this in the future. So we are facing a very delicate situation. However I have to stick to my principles that a military solution must be made as a last, last resort. I mean before everything is exhausted, we cannot talk about military solution, because military solution means bloodshed and we don't want to see any bloodshed among our people.

Lopresti: There is a danger though, that the situation in Aceh could deteriorate, could become another East Timor-type situation. But there are already accusations that those behind the violence are the military themselves?

Rais: At the beginning I liked to buy that kind of theory, until maybe nine or 10 months ago, but now it is just impossible, because if the military is behind the conflict, behind the confusion, are the military are killing themselves, you know? The military is the backbone of our national and defence security too and if they destabilise Aceh and then Aceh finally collapses and it will be separated from our unitary state. That's not at all the idea of the military. I mean this kind of accusation is wrong.

Lopresti: But are you concerned that it will become another East Timor and that the government should be doing more, should have done more to control these groups?

Rais: Yes, yes, yes, I want to see the government do much, much more than what it is doing right now. I believe that we need a kind of multi-dimensional approach, not only to prevent bloodshed, but also a social, political, legal, religious approach because the problem is really multi-dimensional. But we do need many, many, myriad approaches to solve the problem. And it must be now rather than later, for sure it is very worrying right now and if we cannot solve the problem in time, Aceh will become the second East Timor.

Government signals war as GAM says no to Joint Council meet

Jakarta Post - April 11, 2003

Tiarma Siboro and Nani Farida, Jakarta -- Hope for a peaceful solution to the Aceh issue faded on Thursday when the Free Aceh Movement (GAM) declined to attend a Joint Council meeting to discuss violations of the Cessation of Hostilities Agreement.

Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono said GAM had sent a letter to the government to announce that it would not attend the meeting.

GAM, according to Susilo, considers a Joint Council meeting at this point to be unnecessary because the Joint Security Committee (JSC), which is in charge of monitoring the implementation of the peace agreement, "is able to handle the current situation in Aceh". Susilo said the government had decided to give GAM five days to reverse its position.

The government requested the meeting after accusing GAM of reneging on the peace agreement signed in December 2002. Under a peace accord brokered by the Swiss-based Henry Dunant Centre (HDC), the government and GAM agreed to halt all hostilities in the province, where a decades-long armed conflict has left more than 10,000 people dead, most of them innocent civilians.

As part of the accord, GAM, which has been fighting for independence for the resource-rich province since 1976, also agreed to accept special autonomy as the sole basis for future negotiations. The movement also agreed to lay down its arms in a series of stages to be completed by July 9, at which time GAM is expected to have stored all of its weapons. Under the accord, the government agreed to halt all military operations in the province and redeploy its troops from offensive to defensive positions.

Both sides, however, have failed to meet the timeline and conditions agreed upon in the deal. GAM continues to nurture aspirations of independence and has failed to lay down its arms, while the government has not completely redeployed its troops to defensive positions.

Susilo said the government considered GAM's refusal to attend the Joint Council meeting as a sign that it had no intention of complying with the accord.

According to the peace accord, any violation of the agreement must be discussed within the JSC. Should the security committee fail to resolve the violation, a Joint Council meeting may be convened. If the council is unable to resolve the dispute, either party is free to quit the accord.

"We have to prepare other plans ... that is military operations to maintain the country's territorial integrity. I am not saying that the operations will immediately solve the problems in Aceh, but it is the last resort," Susilo said.

The minister said Indonesian Military chief Gen. Endriartono Sutarto was scheduled to brief President Megawati Soekarnoputri on any future military operations in Aceh during a limited Cabinet meeting next week.

"Any military operations would be well planned in order to avoid unnecessary human rights violations. These may be cloudy days for the Acehnese, but believe me it is not doomsday," Susilo said.

The security situation in Aceh has deteriorated and physical threats against the international peace monitors in the province have increased. At least three JSC offices have been attacked recently by mobs of people angered by what they see as the JSC's failure to stop extortion and abductions by members of GAM.

In Aceh, HDC representatives David Gorman would not confirm GAM's decision not to attend the Joint Council meeting, saying only that his organization would continue to seek a time for all parties to sit down together and discuss crucial matters related to the future of the peace agreement.

"Up until now the peace deal is still effective and I ask both Indonesia and GAM to abide by the deal," Gorman told The Jakarta Post on Thursday. He also said that the peace agreement "does not include an independence option but focuses on peaceful efforts to settle the conflict".

Meanwhile, Teungku Jamaika, GAM spokesman for the Pasee region, said his group would honor the peace deal because "after more than 26 years of fighting dialog is the only solution".

"If armed conflict continues to take place here, it is because we have to defend ourselves from attack. We are ready to challenge the government should it insist on launching military operations here ... but the world will see that it is not GAM that has decided to withdraw from the peace accord," Jamaika said.

Jakarta warns of 'military solution' to Aceh discord

Reuters - April 11, 2003

Jakarta -- Indonesia threatened yesterday to resume full combat operations in restive Aceh province as fresh clashes between troops and rebels killed four people, putting yet more strain on a shaky peace pact.

Security Minister Susilo Bambang Yudhoyono said the military chief would present a battle plan to President Megawati Sukarnoputri next week -- in case it should be needed -- after what he said was a snub from the Free Aceh Movement (GAM) to discuss the December 9 peace pact.

"We are seeking a way out so that this so-called wide-scale military operation will not happen. But if peace efforts ... fail, the military solution is inevitable," Mr Susilo told reporters.

The warning to GAM follows the withdrawal to Aceh's capital of 100 peace monitors following attacks on their posts across the region on the northern tip of Sumatra island earlier this week. Both sides have traded accusations over who is to blame for the renewed clashes, the threats against the monitors and the heightened suspicions over political motives.

Mr Eddy Fernandy, a military spokesman in Aceh, said there were at least four clashes between troops and rebels yesterday which left two soldiers and two GAM fighters dead.

Mr Susilo showed reporters a letter from the Geneva-based Henry Dunant Centre, which brokered the agreement, that said the rebels had refused to attend a meeting proposed by the government to try to sort out problems. He said Ms Megawati would review the military plan and decide what to do next.

A leading Aceh-based GAM negotiator refused to comment, saying any response needed to come from Stockholm, where most of GAM's leaders live in exile.

Aceh rebels warned against secession

Straits Times - April 10, 2003

Jakarta -- Indonesia's army commander yesterday warned rebels in Aceh province to drop their independence bid or face a military crackdown in the latest challenge to a four-month peace deal.

"If all they talk about is independence, we can't continue this [peace deal]," General Endriarto Sutarto said, adding that he was considering deploying more troops to the region if dialogue failed.

The military has repeatedly accused the Free Aceh Movement of campaigning for independence in violation of the peace pact signed on Dec 9. The accord only mentions autonomy for the region on the northern tip of Sumatra island, but rebel leaders say their goal is for the oil-and-gas rich province to secede.

Lieutenant Jamari Chaniago, the chief of the armed forces' general affairs department, told the Antara news agency: "Everything is ready, we are only awaiting the order." These remarks come in the wake of reports that say the four-month-old peace agreement in the province is under severe strain.

International and local peace monitors are being withdrawn from field offices to the provincial capital because of fears for their safety after mob attacks or intimidation.

Soldiers and police on Tuesday killed nine people they described as suspected rebels.

Nine killed in Aceh as peace monitors pull back

Reuters - April 9, 2003

Banda Aceh -- Indonesia's peace pact in Aceh suffered major blows on Tuesday when nine people were reported killed and peace monitors separately ordered their teams across the province to withdraw to the local capital.

A police official said the nine were killed by Indonesian police and military in four incidents, and included one member of the separatist Free Aceh movement (GAM).

"They were extorting money, and started shooting police who were patrolling in the areas," said Lt Col Mariyanto, police chief in Pidie district some 75 km southeast of Banda Aceh, the provincial capital.

"One is a GAM member who killed one of my subordinates last year," he told Reuters by telephone. "The eight others were criminals who carried illegal weapons." GAM spokesman Sofyan Ibrahim Tiba said four out of the nine were GAM members, one was a civilian, and the four others had not been identified yet.

David Gorman, Indonesia head of the Henry Dunant Centre, which brokered a four-month-old peace deal between GAM and the Indonesian government, said he had not had confirmation of the killings but thought that if true they would mark the most violent day since the agreement was reached.

Earlier in the day, Gorman had said about 100 peace monitors were withdrawing to Banda Aceh, 1,700 km northwest of Jakarta, following attacks and protests against four monitoring offices since Sunday.

The move came amid growing fears among diplomats that the pact, aimed at stopping fighting that has simmered for decades and taken thousands of lives, is unravelling.

Gorman said the monitors would stay in Banda Aceh until a review of the security situation had been completed. "The Joint Security Committee will temporarily relocate its field-based monitoring teams to its Banda Aceh headquarters to ensure their safety," Gorman said, referring to the committee that supervises the landmark agreement.

The committee comprises independent foreign monitors -- made up of Thai and Filipino soldiers -- along with representatives of the Free Aceh Movement (GAM) and government troops.

Gorman said all the recent incidents against the teams had been well-organised. One diplomat who has been following the process said they appeared to have been carried out by people who sympathised with the government.

On Sunday, 300 Acehnese torched one peace monitoring office in east Aceh, while on Monday, 750 people besieged a facility in south Aceh demanding the monitoring team leave.

Also on Monday, 40 police from an elite unit occupied an office in northern Aceh, kicking a rebel on the monitoring team, the Henry Dunant Centre said. In the last incident, anti-GAM and anti-JSC posters were plastered on another office. There are 13 monitoring offices, including the torched one.

Who is behind the attacks?

Gorman said the monitors would return to Banda Aceh over the next three days. Asked if the incidents were part of an organised campaign to wreck the peace deal, he said: "It's clear these demonstrations, threats and attacks against the teams are organised and they all have a consistent message. That message has been anti-GAM, anti-JSC and anti-peace process." He declined to elaborate.

Indonesia's cabinet decided on Monday to stick with the agreement, although one option put forward had been to scrap the deal and relaunch military operations against rebels there.

Otto Syamsuddin Ishak, an expert on Aceh, accused the military of trying to sideline the peace monitors. "This is a systematic process in the short term to isolate the JSC, done by the TNI," he said, using the military's acronym. He said while the rebels and Acehnese people wanted the Aceh problem internationalised, the government did not.

Military officials could not be immediately reached for comment, but in the past have denied charges they were trying to derail the agreement. The government has criticised the attacks and said it was fighting to save the peace process.

"Indonesia never tolerates violence or the taking of the law into one's own hands like what the residents did," chief security minister Susilo Bambang Yudhoyono said in Jakarta, speaking before the decision to pull back the monitors.

"We love peace, but that does not mean we don't love our national integrity and national sovereignity." Despite the pact, the rebels still want independence while the government will go no further than special autonomy.

Aceh is one of Indonesia's two separatist hot spots. The other is Papua province in the country's remote east.

[With reporting by Dean Yates, Muklis Ali and Karima Anjani.]

Peace monitors come under renewed attack

Radio Australia - April 8, 2003

The fragile peace pact in Indonesia's troubled Aceh province has come under further strain, with the office of an international peace monitoring group attacked on the weekend, the second attack in little over a month. Some 300-people ransacked the Tripartite Monitoring Team office in East Aceh, destroying computer and other equipment before torching the empty building. Security officials say the mob was protesting against alleged hostage taking by the separatist Free Aceh Movement or GAM.

They also called for the disbanding of the Joint Security Committee, which is supervising the implementation of the December peace deal between Jakarta and GAM. The Geneva-based Henry Dunant Centre which brokered the truce, says the latest attack is a clear attempt to undermine the peace process.

Transcript:

Daly: "Yeah, I would say that we're in a fragile state. That said I think it's important to remember that before December 9th and average of 230 people were getting killed a month in Aceh, and right now we're still in a state of relatively stable security where people are not dying even close to those numbers. We're only seeing about 15 people getting killed a month and we all knew that there would be tough times in this peace process and we've entered into one of those tough times and it's up to both parties to exhibit the commitment to come out the other side of this period."

Lopresti: Obviously though the security of the safety of the peace monitoring group is a concern. What has being done to ensure that security is now being stepped up in Aceh?

Daly: "Well several things, obviously the security of our monitors is our primary concern and thankfully no-one was injured yesterday."

"About two weeks ago, we following several other incidents of threats and intimidation against the monitors, the HDC, the Henry Dunant United Centre formally asked the government of Indonesia to provide us with a 24 hour police presence monitoring officers. So that's one thing that we've put into place to try to ensure the security."

"I think the most important thing though is that we're in constant contact with our monitors and we're serving the security situation in each district. We're going to be very quick to try to prevent this sort of thing from happening again."

Lopresti: You say that you'd gone to Jakarta for help, but there are reports that the Indonesian military was up to its old tricks of using civilian proxies to create unrest, to create what happened on Sunday and in March.

Daly: "Well, I certainly hope that isn't the case and if it is the case I hope that the government and particularly those who are in strong support of peace in Aceh and can address that situation."

Lopresti: Given that this the second attack on peacekeepers in just over a month, plus the demilitarisation process is currently at a stalemate, is the peace deal on the verge of collapse?

Daly: "Yeah, the militarisation process has gone slowly. It's something that's very difficult to achieve and both parties are obliged under the agreement to carry out a simultaneous dimilitarisation for GAM it's the placement of weapons and for the government of Indonesia, relocation of their troops and the reformulation of their paramilitary force, and yeah it's gone slowly and the two parties have not been able to agree on a full implementation of the demilitarisation process. And I urge both parties to carry out demilitarisation, but what we've seen so far is no-one has placed, noone has relocated and noone has reformulated and that certainly can't go on forever."

Fresh threats against Aceh monitors

Jakarta Post - April 8, 2003

Jakarta (Agencies) -- Hundreds of people besieged a peace monitoring office in the restive province of Aceh on Monday, one day after a separate facility was torched, in the latest blow to a landmark peace pact that is threatening to unravel.

The Geneva-based Henry Dunant Centre, which brokered the peace deal between the Freedom Aceh Movement (GAM) rebels and Jakarta in December, said the incident took place late on Monday when about 750 people demanded the monitoring team leave the town of Tapaktuan in south Aceh. It was unclear what had angered the crowd.

"They made a demand that the monitoring team leave by Friday and they wanted a letter immediately to that effect," Steve Daly, a spokesman for the Henry Dunant Centre, told Reuters.

He said there was an implied threat in the demand, prompting the monitors to issue the letter, although they were still in the town. Daly said no decision had been made on withdrawing the 12 monitors, including two Thais. The crowd had since disbursed.

On Sunday, 300 Acehnese set fire to a peace monitoring office in the East Aceh town of Langsa. No one was hurt but it followed the ransacking of another office a month ago.

Antara reported on Monday that thirteen people have been interrogated following the torching of a peace monitoring office in the troubled province of Aceh on Sunday.

"Four people have confessed vandalism and torching for disappointment towards separatist Free Aceh Movement [GAM] member in the East Aceh chapter of the Joint Security Council," National Police Chief General Da'i Bachtiar said here on Monday.

Mobs forcing peace monitors to leave Aceh

Associated Press - April 8, 2003

Banda Aceh -- International peace monitors in Indonesia's Aceh province yesterday said they would withdraw from the south of the province after a mob of up to 900 people threatened to burn down another of the group's offices.

The incident is the latest blow to a fragile peace between separatist rebels and the government in Aceh province aimed at ending a 26-year-old war in the region. On Sunday, a pro-Jakarta mob torched an office belonging to the Henri Dunant Centre, the Swiss-based non-governmental organisation which is overseeing the peace deal. It was the second time an office belonging to the observers had been attacked since the deal was signed in Geneva on December 9.

A spokesman for the centre, Mr Steve Daly, said an "organised mob" of around 900 people yesterday surrounded an HDC office in Tapaktuan in south Aceh, 320km south-east of the provincial capital of Banda Aceh.

He said the protesters threatened to burn down the building unless the monitors left the region by Friday. He said it was unclear who was behind the incident.

After talks with the mission's leadership in Banda Aceh, staff members handed the demonstrators a letter agreeing to leave South Aceh by Thursday, he said. The crowd, which carried banners accusing the observers of being biased towards the rebels, then dispersed, witnesses said.

Rebels and some rights activists have accused elements of the military of attempting to destroy the peace process by orchestrating the violence and intimidation -- a charge denied by police and military officials.

On Sunday, Mr Daly said the peace process was "clearly in trouble" as a result of the attack, adding that yesterday's incident only served to reinforce those fears.

In recent weeks, the government and rebels have repeatedly accused each other of not abiding by the terms of the peace deal. However, the deal has succeeded in dramatically stemming bloodshed in the province.

Insurgents have been fighting since 1976 for an independent state in oil and gas-rich Aceh. About 12,000 have been killed in the conflict in the past decade.

Cabinet meets on Aceh with peace deal under strain

Agence France Presse - April 6, 2003

Indonesia's cabinet met to discuss the increasingly fragile ceasefire in Aceh's bloody separatist war, with the armed forces chief suggesting it might decide to scrap the agreement.

"We want to decide on a policy, whether we will continue this peace process or whether we will take another way," General Endriartono Sutarto told reporters before the meeting began. He did not elaborate.

Top security minister Susilo Bambang Yudhoyono was quoted by Monday's Jakarta Post as saying the government has asked for a meeting of the Joint Council -- the highest authority supervising the peace pact -- to try to salvage the agreement.

Swiss-based mediators the Henry Dunant Centre (HDC) said they had received no request for such a meeting. But HDC spokesman Steve Daly described the peace deal as "very fragile." "My concern is there are people who want to undermine the process," he said.

In the latest violence in the province on Sumatra island, a mob numbering several hundred on Sunday torched an office used by peace monitors.

The HDC said the attack at Langsa in East Aceh, in which no one was hurt, was "clearly organised" -- like the March 3 attack on another Joint Security Committee (JSC) office at Takengon in Central Aceh. A human rights group has said an army-backed militia and soldiers were involved in the Takengon attack -- an allegation denied by the army.

The HDC said there had also been a number of other threats and acts of intimidation against members of the JSC -- which groups representatives from the security forces, the Free Aceh Movement and foreign peace monitors who represent the HDC.

"These are very troubling developments, especially in light of the vast improvements in Aceh's overall safety and security" since the signing of the peace pact on December 9, said a statement late Sunday.

Daly said the Langsa attack was "very much in the mould of Takengon. They came in trucks, came en masse, had a plan ... and even took a lunch break. "As far as Takengon is concerned, there is no police investigation under way, as far as I know." The number of killings has declined dramatically since the agreement, the first to be monitored by foreigners, took effect. But each side in the war, which has claimed an estimated 10,000 lives since 1976, accuses the other of violations.

Jakarta also says the rebels are spreading lies that the peace deal will lead eventually to independence. Daly said each side had reported an equal number of alleged truce violations.

Asked about accusations that the army might have organised the Langsa attack, Sutarto told reporters: "I have not yet heard such reports. But this is just the usual: everything bad is always blamed on us."

Mob torches Aceh peace monitors' office

Agence France Presse - April 6, 2003

A mob of some 1,000 people ransacked and torched a peace monitors' office in the troubled Indonesian province of Aceh, witnesses and a staff member said.

The mob arrived at the empty Tripartite Monitoring Team office in Langsa, the district town of East Aceh, in trucks and pickups around 9am and forced their way in, destroying computers and other equipment before setting the building on fire, an eyewitness told journalists there. The witness said there were no police on site.

The protesters, who were demanding the release of hostages allegedly captured and held by the separatist Free Aceh Movement (GAM), then went to the local district military command, which is near a hotel where the members of the monitoring team are staying.

They were also demanding the disbanding of the Joint Security Committee (JSC), which supervises the implementation of a December 9 peace pact between the government and the GAM.

The JSC comprises representives from the government, the GAM and from the Geneva-based Henry Dunant Center (HDC) which has facilitated peace talks since 2000. The JSC also oversees the tripartite monitoring teams.

"We condemn this incident and we call on the Indonesian government to provide security for the members of the monitoring team. We also call on the Indonesian authorities to conduct a full investigation and bring the perpetrators to court," HDC spokesman David Gorman told AFP.

He said that the JSC has already received a report of the incident and was currently gathering more information. The members of the monitoring team in Langsa had been moved to the military compound for their own safety, he added. The identity of the mob was unclear.

Past attacks on JSC and monitoring teams' offices have been conducted by pro-government groups, including what the GAM said were local militias nurtured by the Indonesian military. The military has denied the charges.

Two members of the Tripartite Monitoring Team were injured in an attack on the JSC office in Takengon, Central Aceh on March 3. Aceh's separatist war has claimed an estimated 10,000 lives since 1976.

West Papua

TNI nabs suspect of armoury raid in Papua

Jakarta Post - April 13, 2003

Jakarta -- The Indonesian military (TNI) has arrested a man suspected of involvement in last week's raid on an armoury in Papua province, a district commander said on Saturday.

A group of 15 armed gunmen broke into the Wamena district military compound last Friday during a power cut and made off with 29 firearms and thousands of rounds of ammunition. Two soldiers and a suspected rebel were killed.

District military chief Lieutenant Colonel Masrumsyah described the man as "a local resident" and said soldiers had to shoot him in the leg to capture him. "For the moment, he is still under interrogation," he told AFP from Wamena.

Masrumsyah said last week he suspected that a splinter group of the Free Papua Movement raided the armoury. But an internal investigation into possible army involvement in the raid is currently in place. There have been cases in the past in Indonesia of poorly paid troops selling weapons.

The Free Papua Movement, a poorly armed separatist rebel outfit, has waged a sporadic low-level armed revolt since the Dutch ceded control of theresource-rich territory to Indonesia in 1963.

Under an autonomy law that came into effect in January 2002, the province was promised a much greater share of revenues from its rich natural resources.

Jakarta move to split Papua could bring chaos - report

Reuters - April 9, 2003

Dean Yates, Jakarta -- A decision by Indonesian President Megawati Sukarnoputri to split restive Papua into three provinces has created serious tension and could spark violence, a respected think tank said on Wednesday.

The International Crisis Group, based in Brussels, said the move -- outlined in a presidential decree that has yet to be implemented -- appeared to be an effort to weaken the independence movement in the remote eastern province. Megawati issued the decree in January amid little fanfare.

"The presidential instruction has thrown Papua's administrative status into legal limbo. It has done more to create tension and turmoil in Papua than any government action in years," said Robert Templer, ICG's Asia Programme Director.

Megawati's decree envisages three provinces called West Irian Jaya, Central Irian Jaya and Irian Jaya and calls for the establishment of provincial governments and the drawing up of borders. Government officials were not immediately available to comment.

Papua is a mainly Christian and animist province filled with an array of natural resources in the country's east. A low-level guerrilla conflict has simmered in the giant region for decades, unlike Aceh province in the northwest where an independence war has killed more than 10,000 people since the mid-1970s. The government and Aceh rebels signed a peace pact last December, although that deal has begun to unravel.

The ICG report, called "Dividing Papua: How not to do it," said the decree was issued without consulting Papuan leaders. The report said the driving force behind the decree was almost certainly the determination of the national intelligence agency BIN and the army to weaken the independence movement.

Political movement said to worry government

Besides small bands of armed rebels, there is an umbrella group of Papuan leaders that seeks independence peacefully, the Papuan Presidium Council. It is this political movement, not the rebels, that diplomats say frightens the government.

"President Megawati apparently issued this decree in an effort to weaken the Papuan independence movement," ICG's Indonesia project director, Sidney Jones, said.

The ICG, which aims to prevent and resolve conflict around the world, has had a presence in Indonesia since 2000, and its views are widely respected in the diplomatic community. Although there have been no reports of violence over the decree, ICG said that could change, especially ahead of Indonesia's 2004 elections, with leaders of both pro- and anti-division groups expected to mobilise their supporters.

It said Indonesia's second biggest party, Golkar, dominated the provincial government and legislature and had suggested the division would benefit Megawati's Indonesia Democratic Party- Struggle (PDI-P).

"Dividing the province could help Megawati's PDI-P party and weaken it's main rival, Golkar. Already, we're seeing a scramble by some local politicians to join the pro-division camp in the hope of getting access to power and wealth," Jones said.

The official reason for the move was to bring the government closer to the people and speed development, the report said. The report said the decree had effectively thrown away a 2001 special autonomy package worked out with Papuans and which gave them greater say over their affairs. It said the best that could happen was Jakarta would delay implementation of the decree and work on a broader consensus.

The decree had infuriated many Papuans who had an attachment to Papua as a single political entity and undermined moderates who saw autonomy as a way of encouraging independence supporters to work within the Indonesian state, the report added.

Troops implicated in Papua arms theft

Jakarta Post - April 10, 2003

Tiarma Siboro, Jakarta -- The Indonesian Military (TNI) has found strong indications of the involvement of its own members in a recent burglary at the Wamena military district's arsenal that left three dead, including two Army soldiers.

"Based on preliminary investigations, there are strong indications that certain "insiders" were involved in the raid. They are assigned to the district command but we still have to question them further to determine and identify all those involved," TNI chief for general affairs Lt. Gen. Djamari Chaniago said after attending the 57th anniversary celebration of the Air Force at Halim Perdanakusuma airbase on Wednesday.

Djamari said the TNI headquarters had sent two companies of soldiers to Papua to join the manhunt and to assist in the investigation process conducted by the Trikora Military Command, which oversees Papua.

At least 13 M-16 rifles, 13 SP-1 rifles, and three PM rifles, along with thousands of rounds of ammunition were stolen after a group of people initially believed to be members of Free Papua Movement (OPM) broke into the Army arsenal in Wamena, Papua last Friday.

Two Army soldiers -- First Lt. A. Napitupulu and First Sgt. Ruben Lena and one civilian, suspected to be a rebel, identified as Islae Murib, were killed in the ensuing shootout.

TNI spokesman Maj. Gen. Sjafrie Sjamsoeddin said earlier that the electricity was cut during the burglary, while the soldiers assigned to guard the arsenal were not around when the incident took place. Sjafrie said the burglary was spotted by patrol soldiers who accidentally were passing the location.

Following the incident, the TNI headquarters sent 144 combat soldiers from the Army's Special Force (Kopassus) to the province to hunt for those responsible.

A month earlier, the elite force's task force in provincial capital Jayapura was dissolved following mounting criticism over its involvement in the killing of former Papua independence leader Theys Hiyo Eluay in 2001. Six Kopassus members are now being court-martialled in Surabaya, East Java for their role in the killing.

Army Chief of Staff Gen. Ryamizard Ryacudu had instructed a thorough investigation into the alleged involvement of the military district's personnel in the arms theft. He also ordered the military in Papua to quell the secessionist movement.

Separately, Trikora Military Commander Maj. Gen. Nurdin Zainal said on Wednesday that the joint military team had apprehended one suspected OPM member named Carius Murib in Napua village, Jayawijaya regency.

"We actually arrested Carius, a civilian who joined the OPM group under the leadership of Yustinus Tabuni on Sunday. This group raided the district's arsenal. He [Carius] confessed that during the raid, they stole seven rifles, three of which were out of order," Nurdin was quoted by Antara as saying on Wednesday.

The joint military team had also seized rifles from Carius, Nurdin added.

"The investigation is underway. Currently, the joint team is questioning several witnesses who are suspected of involvement in the raid, but they've not yet reached a conclusion. But we are continuing to search for other OPM members in remote jungles," Nurdin said.

West Papuans debate way forward for freedom struggle

Green Left Weekly - April 9, 2003

Hans Gebze is a West Papuan student based in Yogyakarta. He has been involved in political struggle since before 1998. He is a secretary-general of the Alliance of Papuan Students (AMP). Gebze spoke to Green Left Weekly's Max Lane about the West Papuan people's struggle for freedom.

The AMP formed in 1998 "as part of the radicalisation of university students throughout Indonesia during the movement to overthrow Suharto, which succeeded in May 1998", Gebze explained. "The AMP was formed out of various city-based student organisations in Sulawesi, Bali and Java. These groups were originally quite moderate and under the tutelage of the [Indonesian-controlled] Irian Jaya provincial government. Of course, students in West Papua were also involved." The first big AMP congress was held in Yogyakarta in June 1998. It adopted as its general perspective support for the "decolonisation" of West Papua, Gebze said. "At that time, we decided to concentrate on exposing the historical reality of what happened in 1969, around the so-called "act of self-determination". We published various materials, including a book, Papua Accuses. But I have to say, at the time we had a weak emphasis on building the movement." By December 1999, the AMP had suffered some splits. One group of Papuan students in Bandung established the Papuan People's Council (DERAP) and another group established the Independent Network for KEJORA Action (JIAJORA). According to Gebze, DERAP has become less active and JIAJORA is in a process of internal consolidation. There were no significant political differences between DERAP, JIAJORA and the AMP, but AMP's weak emphasis on building the movement in the early period allowed more space for leadership rivalries to sharpen.

AMP began its own process of reconsolidation in January, 2001. "We consolidated first in Yogyakarta, then in Bandung in May 2001 and Numbai in December 2001. We also had maintained a strong group in Sorong in West Papua since January 1999. We have only just been able to consolidate in Jakarta." Gebze explained that in West Papua, AMP's base is in Jayapura, the capital, and in the central highlands areas, including Timika, Puncak Jaya, Jaya Widjaya, Nabire and Penyi. "These are the main population centres. It is also the area of operation of Freeport mines and the areas where the Indonesian military has been most active over the years." In these areas AMP is undergoing a transformation in its social composition, Gebze explained. "The initial members of AMP were university students. These students became involved in organising other sections of the population, including traditional subsistence farmers -- who we call the masyarakat adat -- and lower-level government employees. We are planning to change from a student to a political organisation." Platform Since 2001, AMP has reaffirmed its political platform. AMP calls for: the decolonisation of West Papua through the holding of a referendum (in which all West Papuans, as well as all people who have been resident in the territory for 20 years or more, can vote); for the demilitarisation of West Papua; for the removal of the remnants of the Suharto regime; for dekapitalisasi (the end of the domination of capital); and for an end to all genocidal policies.

The AMP sees the absence of any serious policy by Jakarta to deal with the rapid spread of HIV-AIDS in West Papua as a deliberate policy aimed at the genocide of Papuans.

As part of dekapitalisasi, the AMP is calling for the closure of the giant US-owned Freeport mine until the West Papuans' key demands are met. The AMP seeks a system of joint ownership of the mine that includes a role for local communities.

"Other complications have now developed as a result of the influx of international capital [into West Papua]", said Gebze. "British Petroleum is coming to West Papua. The government in Jakarta is supporting this and also using it to try to set up conflict within the Papuan bureaucratic elite. Jakarta and the Indonesian national parliament are dividing West Papua into two separate provinces. The bureaucratic elite in one province will be `working with' Freeport and the other with BP. They hope that this temptation will draw sections of the local bureaucratic elite into supporting the new provinces and away from supporting self-determination." Gebze emphasised that the creation of two provinces will also bring benefits to the Indonesian military. The new province containing the BP facility will provide the military with an excuse to establish a provincial military command in the area and allow it to transfer more troops into the area. "We join with pro-democracy groups throughout Indonesia to demand the demilitarisation of Indonesia and the abolition of the provincial military command system", Gebze added.

Grassroots organising "The AMP is also part of a broader organisation called the Koteka Tribal Assembly (DEMMAK)", Gebze explained. "DEMMAK emerged as a kind of opposition alliance following the second Papuan People's Congress in May-June 2000, which was organised by the opposition Papuan Presidium Council (DPP).

"DEMMAK involved student groups associated with AMP and also village-based people as well. DEMMAK groups felt that the DPP was too weak in their attitude towards Freeport. Some DPP people, like Tom Beanal, the deputy chair of the DPP, are also members of the Freeport board and are shareholders. Others are paid directly by Freeport. Many of the DPP people had direct links to Golkar, the party of former Indonesian dictator Suharto, and even the military. It has also been people such as these who have been signing agreements with BP. We think they are also being paid by BP." While the AMP participated in the second Papuan Peoples Congress, it became disenchanted with its elitist leadership and left to help establish DEMMAK. Through DEMMAK, AMP activists conduct grassroots organising.

"At the village level, among subsistence farmers, we organise around demands for Papuan self-determination and demilitarisation. These issues impact on them most of all. Economic issues are more important to people in the towns, especially among low-level employees, who are also a base for DEMMAK." According to Gebze, the DPP represents a more conservative part of Papuan society. Its base is in the upper levels of the bureaucracy, where corruption is more widespread due to its access to business, especially international and Jakarta-linked firms. "The DPP leadership represents an alliance between the Papuan bureaucratic elite, many with links to Golkar, the military, Indonesian big business and foreign capital. They can organise parts of the lumpenised urban poor, who have been used by the military in the past." Gebze also noted that the DPP also has a student section, called the Youth and Students Panel. It is only based in Jayapura and has never been a part of any political movement, having been appointed by Papuan People's Congress.

"The DPP only pursues diplomatic activity in relation to the issues of self-determination and democracy. DEMMAK emphasises both the diplomatic struggle and local mass action; it conducts popular education around the true history of Papua", Gebze explained. "All the same, we must note the DPP leaders are still supporters of independence." Gebze pointed out that the former DPP head, Theys Eluay, who was killed by Indonesia's elite Kopassus soldiers last year, was also a former Golkar leader. He worked with Jakarta in 1969 to implement the notoriously fake "act of self-determination" which incorporated West Papua into Indonesia. "Our differences revolve around how to struggle for independence and over what kind of society Papua should be after it wins its freedom." Gebze emphasised that the AMP wants to build a strategic alliance with genuine pro-democracy forces in Indonesia. "Our best prospect for change is through the expansion of democratic space in Indonesia. Just as with East Timor, the prospects for the advance of the struggle in Papua are linked to deeper changes within Indonesia itself. The government of Indonesian President Megawati Sukarnoputri, which represents the interests of the military and international capital, must be replaced. We want to work closely with the Indonesian students', workers' and peasants' movements."

Stolen rifles recovered in military compound

Jakarta Post - April 9, 2003

Nethy Dharma Somba, Jayapura -- After four days of an operation to recover 29 stolen rifles and the rebels who allegedly stole them, combat soldiers from the Army's Special Forces (Kopassus) recovered nine of the rifles, six of which they located on the Wamena military district compound, the very place from where they went missing.

On Friday, 29 rifles were stolen from the military district's arsenal, prompting Jakarta to deploy 144 Kopassus personnel on Saturday, ordering them to hunt down the thieves in the forest in Jayawijaya regency.

The deployment of the elite troops came just over a month after the Army recalled a Kopassus task force in Papua after a six-year presence.

Trikora Military Commander Nurdin Zainal, who oversees Papua, told The Jakarta Post in an interview that three of the nine recovered rifles were surrendered willingly by local residents of Napua village, while the remaining six were recovered in the housing complex inside the Wamena military district compound.

There was suspicion that personnel from the military district played a role in the theft because the burglary occurred under very noses of on-duty soldiers. Six soldiers had already been interrogated in connection with the incident. Six employees of state electricity company PT PLN's local office were also questioned because there was a blackout at the time of the burglary.

The recovered nine rifles are PM, M16 and SP types. Ten other rifles were recovered on Saturday, only one day after the burglary. Soldiers are still searching for the remaining 10 missing rifles, which are allegedly in the hands of rebels.

The burglary has been blamed on Titus Murib and Kelly Kwalik's Free Papua Movement (OPM) separatist group, which operates in the territory.

In the interview, Nurdin explained that within four days of the military operation, the soldiers had identified the locations of two rebel hideouts. "We will continue to search until we recover all the stolen rifles and apprehend those responsible," said Nurdin.

He said the military was handling the case professionally and would not violate human rights. "It's proven that in four days of the operation, no human rights violations were reported as having been committed by the military," he explained.

The military had gathered local religious and community leaders, as well as tribal chiefs, to give them clear information about the burglary and the operation, he said.

"I said to them that if they have any complaints about the operation, they can directly report them to the Wamena district military, not to any unofficial report centers," he said.

sLabour issues

Government to dismiss 2,000 to restructure PPD

Jakarta Post - April 11, 2003

Fabiola Desy Unidjaja, Jakarta -- Adding insult to injury of the employees of state-owned Djakarta Transportation bus company (PPD), the government has planned to lay off about 2,000 workers as part of its efforts to improve the company's feasibility.

Minister for Transportation and Telecommunication Agum Gumelar said on Thursday that the dismissal would take place within the next six months, and added that the company would buy 150 new buses during the same period.

"To restructure the company, we have to buy more buses and reduce the number of employees," the minister said, adding that the restructuring was being supervised by the office of the State Minister of State Enterprises.

He said that currently, the company employed 12 workers to run a single bus, while the ideal number was five workers per bus.

"We have 450 operating buses and plan to buy 150 more," Agum said, and explained that this plan would improve the ratio of crews to buses.

The company has about 5,000 workers, but with the new arrangement, it would only need 3,000 workers to operate 600 buses. "We have to do this to improve the performance of the company and to provide better public services for the people, and we need public support on this issue," Agum remarked.

His comment came a day after PPD workers went on strike to protest the company's inability to pay their salaries for the last three months. In response to the strike, Minister of Manpower and Transmigration Jacob Nuwa Wea planned to hold a meeting between PPD employees and management on April 14.

Wednesday's strike was the latest incident in the prolonged dispute of the company, which has suffered many losses and is renowned for providing substandard public service.

The central government once proposed to the Jakarta administration to take over the company, but the city was reluctant to accept the proposal, as they would also be taking over PPD's huge loans.

Agum said that the government needed about Rp 190 billion (US$21.6million) to finance the restructuring and that the money would be raised by selling several assets of the company.

"For severance pay, the company needs around Rp 100 billion, while it needs Rp 30 billion to buy buses and Rp 33 billion to pay the employees' monthly salaries, and the remaining balance for supporting the six-month restructuring program," Agum said.

He said the asset sales was expected to generate about Rp 200 billion for the government.

About 3,000 PPD bus workers to go on strike

Jakarta Post - April 9, 2003

Tertiani ZB Simanjuntak, Jakarta -- About 3,000 bus drivers, conductors and staff of state-owned Jakarta Transportation company (PPD) planned to strike on Wednesday and attend a rally demanding President Megawati Soekarnoputri solve the company's internal problems.

Organized by the PPD branch of the Indonesian Prosperity Trade Union (SBSI), the workers have two main objectives: rejecting the management's recent plan for asset divestment and demanding that full control of the management be under the city administration.

"As a state enterprise, PPD is poorly managed because too many parties are involved in its management. Under these circumstances, we suspect PPD is simply being treated as a cash cow," vice coordinator of the SBSI unit within PPD Robinson Hasibuan told The Jakarta Post on Tuesday.

The rallies will be held in front of the State Palace on Jl. Medan Merdeka Utara, and the Ministry of Finance near Banteng square in Central Jakarta. Bus crews had earlier threatened to go on strike and hold their rally on Tuesday.

Currently, authority over PPD financial affairs lies in the hands of the Ministry of Finance, operations with the Ministry of Transportation, management control at the office of the State Minister for State Enterprises, while control over the area of operations lies with the Jakarta administration.

The workers have been complaining for months about the plan for asset divestment, arguing that the company's fleet of 751 buses are all more than 10 years old, while of those, only 315 are roadworthy and serve only 44 routes of the 152 originally allotted by the city administration.

"The government disbursed a total of Rp 203.6 billion [US$22.8 million] in subsidy between 1996 and 2001, but we have yet to see any improvements in worker welfare, let alone new buses," Hasibuan said.

PPD currently employs 5,388 workers, who have the status of public servants, as it suspended recruitment from 1995 because its profits continued to decline, while, according to PPD spokesman Safrudin Dahlan, the amount of subsidy was not enough to cover the company's huge expenses.

Since the merging of seven private bus operators into PPD in 1985, the ratio of buses to staff is 1:12, which means that one bus is handled by about 12 crew members, a far cry from the acceptable ratio of 1:5.

The company's data shows that the average income per month is around Rp 7.5 billion, while the expenses, including salaries, fuel, maintenance, meal allowances and administration costs of PPD's 15 offices and one garage amount to an average of Rp 11 billion per month.

"When the subsidy was disbursed, we were already saddled with large debts due to the high cost of bus maintenance and insurance, the recovery of which we had to prioritize," Safrudin told the Post.

The poor management attracted public attention soon after PPD, in compliance with state policy, raised staff salaries by 70 percent to 240 percent in October 2002, from an average Rp 2.7 million to Rp 5.7 million per month starting in November.

"Afterwards, we didn't receive our salaries on time, and not the full amount. The management paid our January salary by installments, which were only completed on March, while we only received one quarter of our February salary. We have yet to receive our March salary," a bus driver, Sabari, told the Post.

Safrudin said the management had considered dismissing most of the workers, mainly administrative staff, to reach the more ideal ratio of about 1:6.

PPD finance manager A. Gani Kamaluddin said the company would pay Rp 50 million in severance pay.

However, according to bus crews, two employees, who had served 20 years and 24 years in the company and were dismissed earlier this year, received only Rp 8 million and Rp 10 million respectively in severance pay.

"The management also said the money would only be disbursed if the asset divestment plan went ahead," Hasibuan said.

Long running industrial dispute settled

Radio Australia - April 8, 2003

A long-running industrial dispute in Indonesia has come to an end. The Shangri-La Hotel has settled with 80 former workers, who have been picketing the five-star hotel in Jakarta since being sacked in December 2000. The dispute attracted the attention of unions world-wide and at one point drew in the World Bank for criticism. Indonesian union leaders say the dispute showed up holes in the country's labour laws which they say haven't been remedied by the recent passing of a new law. The end of the dispute coincides with the announcement of the Shangri-la's first foray into the hotel business in Australia.

Transcript:

Snowdon: More than two years ago, pay negotiations at the five- star Shangri-La hotel in Jakarta broke down.

The union leader was sacked and when the workers went on strike in his support, the hotel sacked all 580 of them, locked them out and called the police. Several unionists ended up in jail overnight but were not charged.

The hotel was closed for two months and re-opened with a new workforce.

500 of the workers accepted a pay-out but another 80 held out for their jobs, despite their strike and picketing being branded illegal by the District Court.

More than two years later they don't have their jobs back, but believe the battle on principle was worth it.

Speaking from Bandung with the help of an interpreter is Eddi Hudiyanto, the Secretary of the Shangri-La Hotel Workers Union.

Hudiyanto: "While we did not achieve our demands for reinstatement, our members nevertheless consider the outcome as a significant and excellent achievement. Considering the odds stacked against us and the difficulties we had to overcome, we are satisfied with the outcome."

Snowdon: The final settlement between the strikers and the hotel included a payout for each employee worth about four years of their basic pay and the Hotel agreeing to drop a two-million US dollar claim for damages against the union.

Eddi Hudiyanto says the dispute was longer and harder than it should have been, and he says the blame lies with Indonesia's industrial relations system.

Hudiyanto: "We were outraged by the injustice of what happened to us. We showed clearly that our struggle was a struggle for justice, for the union rights. The existing institutions in Indonesia for example, the dispute resolution mechanism and industrial relations were useless. We had no choice; we showed that those who gave up early got only a pitiful a small portion of what we got eventually. The management attitude towards us was take it or leave it."

Snowdon: The Shangri-La luxury hotel chain spreads throughout Asia. Its settlement with the Jakarta unionists was finalised on the 7th of March. On the 26th of March the group announced its first contract in Australia -- to manage the five-star ANA Hotel in Sydney.

Beyond a brief written statement saying the dispute was satisfactorily resolved, the Shangri-La had no further comment for this story.

Shangri-La is majority owned by the Kuok Group, the empire of the Malaysian sugar and property tycoon, Robert Kuok. The dispute went so far to at one point draw in the President of the World Bank when he was lobbied on behalf of the sacked workers by the Australian Council of Trade Unions. The Bank had extended to the consortium building the Jakarta Shangri-La a multi-million dollar loan, despite the wealth of its owners.

Indonesia has recently enacted a new Labour Law and while Eddi Hudiyanto says the Shangri-La dispute helped forge some of its changes, he believes the new Labour Law is more anti-union than its predecessor.

Hudiyanto: "So the main problem is that because the system of industrial disputes and settlement in Indonesia is quite corrupt. The new act is worse because in the new act the government undermines the role of the union to take care of their membership in each industrial dispute."

Workers demand better welfare, milk

Jakarta Post - April 7, 2003

Tangerang -- After a three-day rally, some 900 factory workers of PT Hancook Ceramics Indonesia, in the Pasar Kemis district of Tangerang, went on strike from Friday to Saturday demanding improvement in welfare benefits.

Jejen, one of the workers, said on Saturday that the rally was initiated by workers in the printing department, who demanded the management to fulfill its promise to provide a glass of milk for workers each day as a dietary supplement, because they worked with chemicals that could affect their health.

Since the management did not respond positively, workers from other departments demonstrated their solidarity by joining the strike, he said.

He added that the management had also failed to fulfill their promise to improve the workers' welfare through the provision of transportation allowances and other benefits.

War in Iraq

Rallies urging end to Iraq war continue to heat up

Jakarta Post - April 10, 2003

Jakarta -- The Star Party of Reform (PBR) failed on Wednesday to make good on its earlier boast that it would gather one million supporters in a rally against the US-led attack on Iraq.

Party chairman Zainuddin M.Z., a prominent Muslim cleric, led a few thousand supporters who turned up for the rally, which marked the new name of the party. The PBR changed its name from the United Development Party of Reform in accordance with the political party law, which bans parties from bearing the same name. PBR is a splinter group of the United Development Party, which is chaired by Vice President Hamzah Haz.

Zainuddin said during the rally in front of the US Embassy on Jl. Medan Merdeka Selatan in Central Jakarta that the incursion of Iraq was aimed at ousting the legitimate Iraqi President Saddam Hussein, which is against international law.

"It is very clear that a rage to toppling President Saddam Hussein's regime is behind US President George W. Bush's motive to devastate Iraq," he said.

Zainuddin also called on Americans to urge the US government and its allies to stop the war that created "Hell in Baghdad". "Only my brothers, the Americans, can manage to stop Bush, who is out of his mind, now," he said.

Meanwhile, dozens of protesters dressed in traditional attire rallied outside the British Consulate Office and the US Consular Agency in the Balinese capital of Denpasar. The protesters, who came from the Hare Krishna and Ashram Gandhi spiritual Hindu groups in Bali, chanted several religious songs during the rally.

In the East Java capital of Surabaya, around 100 activists of the women's wing of the Association of Islamic Students (HMI), rallied outside the US Consulate Office on Jl. Dr. Sutomo to demand an end to the war.

The students said the US and its allies were promoting neo- colonialism and neo-imperialism by invading Iraq, burned the American, British and Australian national flags, and called for a boycott of US products, including the American dollar.

They also unfurled banners reading "PBB stands for Persatuan Badut-badut" (The United Clowns) and "Boycott the US Dollar". "PBB" is the Indonesian acronym for the United Nations. "We demand the Indonesian government to withdraw all diplomats from the US and its allies and sever diplomatic ties with those aggressors," they yelled.

In Yogyakarta, about 200 activists from the National Students Front (FMN) and the Indonesian Muslim Students Front (KAMMI) of Gadjah Mada University rallied on campus.

In a written statement, the FMN condemned the attack on Iraq, calling it a war initiated by an imperialist country which wanted to expand its power, and therefore, they urged President Megawati Soekarnoputri to freeze Indonesia's diplomatic ties with the US and its allies.

KAMMI, on the other hand, demanded an international tribunal for President Bush, British Prime Minister Tony Blair, and Australian Prime Minister John Howard on charges of war crimes.

The government has repeatedly dismissed calls to sever diplomatic ties with the countries involved in the war and to boycott their products.

Demonstrators torch Bush effigy

Jakarta Post - April 10, 2003

Jakarta -- Some 600 people rallied on Wednesday outside the US embassy, torching an effigy of a gun-toting US President George Bush and describing the war in Iraq as genocide.

"Drag Bush and Blair to an international tribunal" and "Stop genocide in Iraq," read some of the placards displayed by the protesters, from a faction of the largest Islamic political party the United Development Party, The Crescent Reform Party which was led preacher Zainuddin MZ.

"Bush is a war criminal who is killing women and children in Iraq," one protester shouted through a megaphone, AFP reported.

Largely peaceful protests have been held daily in Indonesia, the world's most populous Muslim nation, since the war began on March 20. The government has also strongly criticised the US-led invasion of Iraq.

President Megawati Sukarnoputri said earlier Wednesday she believes the warwill be a long one because the Iraqis are fighting for their country. Megawati said that even when the conflict began she was convinced it would be protracted because of the Iraqis' strong sense of patriotism.

"What we see is how a nation is dedicated to defend the state and the nation," she said. "I say it will be a long war." The US and Britain say they are fighting to liberate Iraqis from the rule of Saddam Hussein.

Antiwar rallies to go on nationwide

Jakarta Post - April 9, 2003

Jakarta -- With the war in Iraq moving closer to its third week old, anti-American protesters in the country displayed no signs of fatigue as they continued to voice their demand for an end to the US-led attack.

In Jakarta, 10 Iraqi refugees staged a rally in front of the United Nations High Commissioner for Refugees Representative Office on Jl. Kebon Sirih, Central Jakarta. The protesters urged the UNHCR to return them to Iraq to allow them join their compatriots put up a fight against the coalition forces.

"We watch the war on television every day, sparking our deep concern of manslaughter in Iraq. We cannot help to return home to join the struggle alongside Iraqi people against the US-led coalition," said the protesters.

Hundreds of Iraqi refugees have been in Indonesia to obtain political asylum. Most of them fled the regime of incumbent President Saddam Hussein.

Meanwhile, in the West Java capital of Bandung, around 300 protesters of the Indonesian Muslim Youth held anti-war rally outside the West Java City Council Office on Jl. Diponegoro. The protesters called on the dissolution of the United Nations for the international institution's failure to prevent the outbreak of the war in Iraq.

"We urge the dissolution of the United Nations as they are proven ineffectual to prevent the war. Instead, the Non Aligned Movement can be revived to replace its role," said the protesters.

In Yogyakarta, at least 500 students of the Sunan Kalijaga Islamic University, marched from their campus to the city's post office on Jl. Senopati.

Those students stopped for 15 minutes in front of the American franchised fast food outlet McDonald's on Jl. Malioboro, to call for a boycott of the US products. Hundreds of students of the Ibnu Khaldun University in Bogor, West Java, rallied in front of the Bogor City Hall to protest the US led strike on Iraq.

The protesters berated military action against Iraq which is against the principle of sovereignty. The military incursion in Iraq has incited worldwide condemnation.

At home, the wave of demonstrations will heat up in the next days due to swelling number of war victims in Iraq. The United Development Party of Reform said earlier that it plans to hold a massive anti-war demonstration on Wednesday. The demonstration which will be led by popular Muslim cleric Zainuddin M.Z. who also chairs the party, expects around one thousand of protesters taking part in the rally.

Meanwhile, the National Democratic Party (PDK) of South Sulawesi announced plans to hold a mass prayer for the Iraqi people on Thursday evening at the Mandala Monument in the provincial capital of Makassar. The event's organizer, Harly Weku, said nearly 1,000 of the party members would participate in the prayer, which will be attended by the party deputy chairman Andi Alfian Mallarangeng. Religious leaders, including from Islam, Christian, Hindu, and Buddhism, will recite the prayer.

The largest antiwar rally was held in Jakarta on March 30, involving hundreds of thousands of people from various groups and faiths.

Widespread opposition to Iraq invasion

Green Left Weekly - April 9, 2003

Max Lane, Jakarta -- On March 30, at least 100,000 people marched through this city's streets to protest against the invasion of Iraq by the United States and its British and Australian appendages. In the wake of the mass anti-war march, there are widespread expressions of anti-war and anti-US attitudes -- on the streets, at artistic events, in religious services, on TV and radio.

The March 30 protest rally and march had a wide sponsorship, ranging from the radical left People's Democratic Party (PRD) to the Justice Party (PK), a conservative Islamic party. The rally was supported by more than 100 groups, including Catholic and Protestant organisations. There were contingents of Catholic nuns, in the midst of tens of thousands of PK supporters. There were smaller contingents of left nationalist Vanguard Party (PP), led by Rachmawati Sukarnoputri, President Megawati Sukarnoputri's elder sister.

However, members and supporters of the PK and other conservative Islamic organisations made up the overwhelming majority of the protesters. There were other Muslim-based groups, such as Vice- President Hamzah Haz's United Development Party (PPP) and the National Mandate Party (PAN).

Even though the rally was addressed by Rachmawati and PRD member and radical labour leader Dita Sari, the speakers list was dominated by representatives of the conservative Islamic groups.

Sari raised the need for a united Third World stand against US aggression and began a criticism of Third World governments working hand in hand with Washington. She clearly intended to criticise Megawati's approval of the passage of the US warships through Indonesian territorial waters on their way to the Persian Gulf, but her speech was cut short. The fact that several US combat fleets have passed through the Straits of Malacca was raised only in the rally leaflet.

All the other speeches, including those from the Justice Party leaders, simply heaped insults on US President George Bush, denouncing him as "Satan" and "evil".

Amien Rais, chairperson of the PAN and speaker of the National Assembly, also heaped abuse on Bush, but made no demands upon his government -- such as calling for the withdrawal of US troops. Rais is the likely main candidate of conservative Islam against Megawati in the 2004 presidential elections.

There was no significant representation of Megawati's Indonesian Democratic Party of Struggle (PDIP), or that of former president Abdurrahman Wahid's Nahdatul Ulama (NU) mass organisation and associated National Awakening Party (PKB). Nor was there any attendance by members of Golkar, the governing party under ousted dictator General Suharto.

The PDIP has staged a few of its own protests and Megawati, as president, has had plenty of media coverage for her strong rhetoric against Bush and her call for an emergency UN General Assembly session to discuss the US attack on Iraq.

Wahid has not attended anti-war functions organised by the liberal intellectual circles or the mobilisations organised exclusively by NU in its base of East Java. The latter have been attended by tens of thousands of NU members.

Golkar has been more or less invisible on the issue of Iraq.

As the country moves into election mode, the three mainstream political blocs -- PDIP (with Golkar, perhaps), the parties of political Islam (PK, PAN, PPP) and the liberal Islamic NU-PKB -- are each becoming more active in using any issue to promote themselves.

A left bloc has not yet properly emerged. Three parties will be key to the emergence of any such bloc. These are the PRD, PP and the Bung Karno Nasionalist Party (PNBK), headed by Eros Jarot.

A fourth party, People's Struggle Party (PPR), could also play an important role, mainly because it represents a significant portion of the surviving Indonesian Communist Party (PKI) membership -- although these people are now quite elderly and have limited mobilising capacity. They may be a large group however: prior to the Suharto-organised anti-left massacre in 1965-66, the PKI had a constituency of about 10 million people.

According to Dita Sari, most trade unions, while all against the war, have declined to mobilise their members in anti-war protest actions. "Most of the new unions are concentrating on local economic and labour law issues", she told Green Left Weekly. "They fail to be moved by the enormity of the crimes committed by the US in Iraq and also cannot see the link between the increase in US power world-wide and the ease with which neo-liberal policies can be forced on underdeveloped countries." Sari says there is a similar problem with the student movement. "Of course, the student movement itself is not at the peak it was at the time of the overthrow of Suharto [in 1998]. But there are still many student protest actions around the country aimed at the Megawati government. There have been clashes between pro-democracy student groups and the PDIP youth corps. But the student groups are reluctant to join the anti-war campaign. Many are afraid that attention is being drawn away from domestic problems and that the Megawati government is escaping criticism on these domestic issues." At the moment there are several laws passing through the parliament which are part of the political elite's gradual erosion of the democratic rights won by the mass anti-Suharto movement in 1998. There are new labour laws, laws on the functioning of the army, on the media and on presidential elections. All of these have dropped off the front pages of the mainstream press since the war began.

The government is continuing to raise prices of key commodities, including water. These decisions have also been overshadowed in the media by the war.

Megawati has successfully used her rhetoric against the war to improve her image as an "anti-imperialist" figure. Neither the press nor the anti-war movement has successfully raised awareness about the passage of US warships through the Straits of Malacca.

"The Iraq issue is being used by the pro-capitalist political groupings simply for electioneering", Sari told GLW. "I think the PRD will have to concentrate on building the anti-war movement through more genuine and militant coalitions. Already the coalition that organised the March 30 demonstration is backing away from more such events and seems to want to concentrate on fundraising for humanitarian aid.

"We will work through the Anti-Imperialist Front, which comprises various NGOs, women's groups and others. We hope also that FAI can join up with another coalition, the Peoples Anti-Military Front, which has been campaigning against the new law on the military, which gives the generals some extra political powers. In addition, the National Coalition, a broad front of progressive groups, will also likely cooperate.

"We will raise the issue of the involvement of Megawati in allowing warships to pass through the Straits of Malacca and will also emphasise Megawati's general subservient attitude to the US, especially on the economic front since this is impacting heavily on the poor people in Indonesia." The anti-war sentiment in Indonesia is also simultaneously anti-US sentiment, focused on the figure of George Bush. Almost all Indonesian media, describe the US actions in Iraq as an aggression. While most of the parliamentary parties criticise the US invasion of Iraq, they are all still angling for good relations with the Bush administration, especially in the economic field. The political elite in Indonesia has no strategy for the crisis-ridden economy apart from seeking more loans from the International Monetary Fund and a reversal of the collapse in foreign investment. In both cases, they see good ties with Washington as crucial. This even applies to those parties campaigning under an Islamic banner, even a semi-fundamentalist one.

Indonesia president denounces macho warmongering

Reuters - April 7, 2003

Jerry Norton, Jakarta -- The president of Indonesia, the world's most populous Muslim nation, told a conference of Islamic women on Monday that women across the world should launch a movement against war.

"I urge all women across the world, in any country, regardless of race, ethnic group, religion, group or nationality, to launch a moral movement to refuse war, destruction and annihilation," Megawati Sukarnoputri told an international conference of several thousand Muslim women.

Women "need to remind those who claim themselves to be the world's machos, that we do not admire what they are doing," she said.

Megawati, often given to oblique and indirect public comments, did not specifically mention Iraq, although she and her government have criticised the US-led attack there in the past.

But she said: "What we see now are the first signs that humanity has been declining because jungle law has started to come back, where those who are strong force their will on those who are weak." Hours after the US attack on Iraq began Megawati said Indonesia strongly denounced it.

Harsher criticism has come from her outspoken vice president, Hamzah Haz, who has called US President George W. Bush "the king of terrorists", and Amien Rais, head of Indonesia's top legislature, who compared Bush to the late Soviet dictator Josef Stalin in wanting to eliminate all potential enemies.

Despite such rhetoric, the government and elite have also said they do not view the attack on Iraq as directed against Islam, and have cautioned against violent protests.

The country, which is 85 percent Muslim, has seen daily protests since the war began, but most have been relatively peaceful.

That pattern was repeated on Monday when some 250 students demonstrated in front of the heavily fortified US embassy in Jakarta, where their strongest action was the burning of an American flag. Around 50 protesters also hit the streets in the central Java city of Yogyakarta.

Indonesia's biggest demonstration since the war started was on March 30, when more than 100,000 marched against it in Jakarta.

Various Indonesian officials and leaders have said they fear violent anti-war demonstrations could be a setback for efforts by Indonesia, the world's fourth most populous country, to convey an image of stability and attract foreign investment.

They have also tried to make a distinction between criticism of the United States over Iraq and relations on other issues with Washington, a key trading partner and important ally in many areas.

[With reporting by Telly Nathalia.]

Golkar joins nationwide protests against Iraq war

Jakarta Post - April 7, 2003

Jakarta -- The Golkar Party made a belated debut in the anti-war protest stakes on Sunday, more than two weeks after many other groups took to streets across the country to condemn the United States-led attack on Iraq.

Party chairman Akbar Tandjung headed a 700-strong rally in the capital to urge the United Nations to take a leading role in opposing the war in Iraq and forcing the US and its allies to withdraw their troops from Iraqi territory.

Unlike other protesters who opted to rally in front of the US and British embassies, Golkar supporters gathered at the Hotel Indonesia traffic circle and then marched the 300 meters to the UN representatives office on Jl. M.H. Thamrin.

"We don't think the US will listen to our demands for the withdrawal of their troops and an end to the war. We are here to push the UN to take immediate action to stop the war. This is the right time for the UN to prove its credibility," Akbar, who is also the House of Representatives speaker, told party supporters.

Golkar is the first non-Muslim-based party to have joined in the nationwide protests against the war. On Friday, the president of the Muslim-based Justice Party, Hidayat Nurwahid, criticized nationalist parties for having said nothing regarding the war.

Government officials and religious leaders are of the opinion that the war is a humanitarian issue, not a religious one.

Akbar handed over to UN representative Bill Simpson a letter from Golkar to UN Secretary-General Kofi Annan stating the party's opposition to the war in Iraq.

Golkar also demanded that the government try to galvanize world pressure through international organizations, such as ASEAN, the Non-Aligned Movement, European Union and Organization of the Islamic Conference, to stop the war and strengthen the role of the UN.

Later in the day, hundreds of kindergarten teachers from all over Indonesia gathered at the Hotel Indonesia traffic circle to express their sympathy for the Iraqi children who had fallen victim to the war. The teachers, who were in Jakarta to attend a national congress, distributed flowers to passers-by and motorists, Antara reported.

Meanwhile, in front of the US Embassy on Jl. Medan Merdeka Selatan in Central Jakarta, dozens of Muslim activists said prayers for the safety of the Iraqi people.

A similar mass prayer meeting was also held by thousands of followers of the country's largest Muslim organization, Nahdlatul Ulama (NU), in West Kalimantan, who packed the Al Falah Mosque in the provincial capital of Pontianak.

In Banjarmasin, the capital of South Kalimantan, Governor Sjachriel Darham joined in an anti-war rally sponsored by Islamic-based organization Hizbut Tahrir Indonesia. The protesters demanded that the government sever diplomatic ties with the US

In Bandung, Iraqi Ambassador to Indonesia Nadji Mahdi Salih Al- Hadhiti attended a rally of solidarity with the Iraqi people at the Islamic Propagation Center in the West Java capital. Some 3,000 people attended the gathering.

In his speech, Al-Hadhiti asserted that his country badly needed people who were ready to die to defend Iraqi territory from the coalition forces, and not just humanitarian assistance.

He said that Iraq under Saddam Hussein was not that poor and would manage to provide food and other basic necessities for its people for the next seven months.

Thousands of other people in Bandung marched along the city's main streets and unfurled a banner bearing the signatures of more than a thousand people opposed to the war in Iraq.

Instead of staging a rally, people in the South Sulawesi capital of Makassar donated blood for the Iraqi people who were wounded during the war, which has entered its 17th day.

According to the program's coordinator, Dewi Yasin Limpo of the Makassar Phinisi Club, the blood would be transported to Iraq by the Indonesian Red Cross.

Anti-war protests continue in several cities

Jakarta Post - April 7, 2003

Jakarta -- Thousands of people on Sunday took part in anti-war protests in several cities across the country, AFP reported.

In Jakarta, some 700 people took part in a rally organised by the Golkar party in front of the UN mission. Party chairman Akbar Tanjung addressed the rally, telling protestors the demonstration was "to convey Golkar's stand of condemning and rejecting the aggression on Iraq."

In Kediri, East Java, thousands of members and supporters of the Nahdlatul Ulama, the country's largest Islamic organisation, rallied in front of the town's main mosque to protest the US-led invasion and to pledge moral support for the Iraqi people.

In Bandung, West Java, some 1,000 people took part in street convoys held by the Prosperity and Justice Party (PK Sejahtera) to protest the war. Riding cars, trucks, buses and motorcycles, the protestors displayed anti-US posters.

In Banjarmasin, South Kalimantan, some 1,000 people took part in an anti-war march organised by the local chapter of the Hizbut Tahrir, a militant Muslim group.

Indonesia, the world's largest Muslim-populated nation, has seen daily protests since the attacks began but almost all have been peaceful. The government has strongly criticised the war as an act of illegal aggression.

Government & politics

'PDI-P contributes little to nation'

Jakarta Post - April 7, 2003

Bandung -- Megawati Soekarnoputri, chairwoman of the Indonesian Democratic Party of Struggle (PDI Perjuangan) said on Saturday that her party had contributed only a little to the nation.

"If we look at the history of the nation, we should be ashamed that our party has contributed so little compared to what the country has contributed to us," she said.

She pointed out that the people had placed great confidence in the party to win the 1999 elections, but had become complacent since.

"We are still minding our own interests," she said in front of about 30,000 party supporters. She called on party members to listen to the people's aspirations and for party legislators to stop considering their personal interests in tending to their duties.

Media/press freedom

AJI protests reporter's prosecution

Jakarta Post - April 8, 2003

Jakarta -- The Alliance of Independent Journalists (AJI) strongly protested the police's decision to declare an editor of Tempo magazine, Ahmad Taufik, as a suspect in a defamation case.

The group urged the police to revoke the status, because under the 1999 Press Law, an editor could not be declared a suspect for a report published by the media. The law says the responsibility in such a case rests with the heads of the business and editorial sections.

Taufik wrote an article that linked businessman Tomy Winata with the fire that engulfed Tanah Abang Market in Central Jakarta in February. The report sparked anger among Tomy's supporters, who attacked the magazine's office and its journalists in retaliation.

The police has also declared Tempo chief editor Bambang Harymurti a suspect in the case, and three of Tomy's confidants for the attack.

Taufik had been jailed by former president Soeharto for establishing AJI, then a counter organization to the government- controlled Indonesian Press Association.

Regional/communal conflicts

Do not hoist separatist flag, TNI orders

Jakarta Post - April 12, 2003

Ambon -- The Indonesian Military (TNI) warned the separatist Maluku Sovereign Front (FKM) on Friday not to hoist the flag of the South Maluku Republic to mark its anniversary on April 25.

"I will arrest those who hoist the RMS flag," chief of the Pattimura regional military command, Maj. Gen. Agustadi SP, was quoted by Antara as saying.

Maluku Sovereignty Front secretary-general Mozes Tuanakotta had recently said that he and 2,500 supporters of the RMS were ready to hoist the RMS flag on April 25.

He said he was prepared to accept all risks, including being shot by government forces.

"I will not shoot the separatists but I will arrest them and bring them to the authorities for further legal action," Agustadi said in response to Tuanakotta's threat.

Agustadi, however, said additional troops would not be drafted in prior to the RMS anniversary. "We will maintain security the situation as usual. People need not be worried as supporters of the RMS can be detained under the prevailing law," he said.

Human rights/law

UI students tried over rally near Megawati's house

Jakarta Post - April 8, 2003

Jakarta -- Three student activists were tried in court on Monday for public disorder following a rally near the residence of President Megawati Soekarnoputri in January.

Prosecutor M. Manik told the Central Jakarta District Court that defendants Rico Marbun, Fathul Nugroho and Ardi Purnawan Sani of the University of Indonesia (UI) had broken the law as they had failed to inform the police of the rally before it took place and that they had refused to obey former Central Jakarta District Police chief Sr. Comr. Edmond Ilyas, who ordered them to leave the area.

The rally turned ugly after the students refused to disperse, and resulted in the arrest of several demonstrators. The defendants could face up to four months and two weeks in jail if they are convicted of the charges.

The hearing was attended by some 100 UI students, economist Rizal Ramli, the chairman of the Indonesia Uni-Democrat Party (PUDI), Sri Bintang Pamungkas and Fuad Bawazier, a member of the National Mandate Party (PAN).

Rico is the leader of the university's Student Executive Body (BEM). The student body often conducts rallies against Megawatiand the government.

Last year, two activists were convicted of public mischief by stomping on the pictures of Megawati and Vice President Hamzah Haz during a rally in Jakarta. A student activist in Aceh was also convicted for defacing the pictures of Megawati and Hamzah by drawing crosses across their faces early this year.

News & issues

Old visa policy still in effect, no guidelines for new ruling

Jakarta Post - April 12, 2003

Fabiola Desy Unidjaja, Muninggar Sri Saraswati, Jakarta -- Legal confusion has emerged regarding the new policy revoking the free-visa-on-arrival facility extended to nationals of 48 countries, with an immigration official saying the ruling would not come into effect until executory guidelines had been issued.

Directorate General of Immigration spokesman Ade E. Dachlan told The Jakarta Post on Friday that the existing regulation would remain in effect until the issuance of the guidelines, meaning the 37 countries affected by the new policy -- including the US, Britain, Japan, Australia -- could continue to enjoy free-visa-on-arrival facilities.

"Our officers can do nothing if they have no technical guidelines for implementation. Therefore, we have instructed all ports of entry in the country to continue to apply the current policy until further notice," Ade said.

The immigration office's stance appears to contradict the presidential decree on the new visa policy, which states that it came into effect on March 31, the date on which it was signed.

The decree permits short free-visa-on-arrival visits for the nationals of 11 countries, namely Thailand, Malaysia, Singapore, Brunei Darussalam, the Philippines, Hong Kong, Macao, Chile, Morocco, Turkey and Peru.

Under the new policy, nationals from certain countries will be entitled to a non-extendable visa upon arrival at a port of entry, while those from other countries must apply for regular visas from Indonesian consulates and embassies in their home countries.

The new policy cuts the length of the free-visa-on-arrival stay from 60 days to 30 days. The new pay-visa-on-arrival would also only allow visitors to stay here for 30 days, Ade explained.

He said that the justice ministry was currently drafting the guidelines, particularly those concerning the pay-visa-on-arrival procedures. The ministry has sought advice from the foreign ministry and tourism ministry for this purpose, he said.

He said the countries excluded from the free-visa list would be put on the priority list of recipients for pay-visas. These included the countries from which Indonesia traditionally drew tourists.

Separately, the Ministry of Foreign Affairs' Director General of Protocol and Consular Affairs Joko Hardono suggested that visa-on-arrival facilities should only be provided for the citizens of countries that did not have Indonesian embassies or for pressing affairs of state.

"For example if a foreign official has to attend an international conference here, he could avail of a visa-on-arrival facility," Joko added.

He said Indonesian consular offices around the globe were ready to implement the new regulation.

Ade added that the justice ministry planned to adopt a simple visa-on-arrival procedure, such as that applied by Thailand. He was referring to a process that only took several minutes, with immigration officers putting a special stamp on the visa-on- arrival form after visitors pay a sum of money.

An arriving foreign national usually pays US$50 for a visa-on- arrival in Thailand.

The tourism industry has condemned the new policy, saying it will hurt the sector, which has already been hit hard by the October 12, 2002, bomb attacks in Bali, the Iraq war and the spread of Severe Acute Respiratory Syndrome.

Jakarta takes tit-for-tat visa action

Straits Times - April 11, 2003

Devi Asmarani, Jakarta -- Unhappiness with the way some countries have been treating its citizens abroad is behind Indonesia's tit-for-tat decision to scrap visa-free entry privileges granted to dozens of nations, including the United States, Australia and Britain.

After a Cabinet meeting yesterday, Minister of Justice and Human Rights Yusril told reporters: "The move will show that we will treat other countries as they treat us. If we have to have a visa to go there, then they will have to do the same when they come here."

The move has been in the offing for several months, observers said, with the government miffed at the way some countries have been treating Indonesians. In the United States, for example, Indonesian men on long visits or living there have been required to register with the immigration office since early this year.

This, according to the US government, is intended to anticipate any potential terrorist activity.

In Australia, hostile raids at the homes of Indonesian Muslim families have sparked accusations of state-sponsored racism and strained the already fragile bilateral ties between the countries.

"The government realises we must react firmly to this; we don't have to be nice to those who treat Indonesians wrongly," Mr Yusril said in an earlier statement.

A presidential decree, issued earlier this month, stipulates that visa-free facilities will only be available to citizens from 11 countries now, including Singapore and Malaysia nationals.

It comes into force later this month, an immigration department spokesman said. Previously, nationals from 48 countries could enter visa-free.

Mr Yusril also said the decision had been taken because of changes in the immigration policies of countries such as South Korea, which has revoked its free-visa policy for Indonesian visitors.

Tighter visa controls will also control the incoming traffic of foreigners, many of whom have been abusing visa policies by illegally extending their visits here.

Indonesia's liberal 60-day visa-on-arrival policy was introduced in 1984 in a bid to attract foreign tourists. It meant visitors did not have to pay or go to an Indonesian embassy abroad to get a visa, which would be issued on their arrival in the country.

Predictably, the flagging tourism industry -- already reeling from the effect of terrorism, the US-led war on Iraq and the Sars outbreak -- is worried that the policy will discourage visitors.

"The timing is wrong and the consequence of this move could be fatal to the industry," said Meity Robot, the President of the Indonesian Tour and Travel Agencies.

Government revokes visa-free facility for 48 countries

Jakarta Post - April 9, 2003

Fabiola Desy Unidjaja and Muninggar Sri Saraswati, Jakarta -- The government has forged ahead with its plan to revoke the visa-free facility extended to nationals of 48 countries despite determined opposition from the country's tourism industry.

It has also reduced the length of the visa-free stay from 60 days to 30 days, according to a presidential decree made public on Tuesday.

The decree, however, will not take effect until the government issues executory rules and regulations putting meat on the bones of the decree.

The decree, which was signed by President Megawati Soekarnoputri on March 31, permits short visa-free visits for the nationals of 11 countries only, namely Thailand, Malaysia, Singapore, Brunei Darussalam, the Philippines, Hong Kong S.A.R., Macao S.A.R., Chile, Morocco, Turkey and Peru.

The government claims the decision is based on the reciprocity principle, meaning that Indonesia extends the privilege to those countries that are willing to provide the same privilege for Indonesian citizens.

The visa-free facility, first introduced in 1983, was primarily designed to attract more foreign tourists to the country. But the government has argued that the facility has often been abused by foreigners who work in the country illegally or who are engaged in other activities.

Under the new decree, nationals from countries other than those designated will no longer be entitled to the facility. Instead, they will be granted a visa of 30 days at the port of entry port upon arrival .

Such a 30-day visa issued at the port of entry will be non- extendible and will not be capable of being converted into another type of visa.

The decree also stipulates that in the case of tourists visiting the country based upon a contract between an Indonesian tour operator and a foreign tour operator, a grace period of six months will be granted before the new policy is applied. Ade E. Dachlan, a spokesman for the Directorate General of Immigration at the Ministry of Justice and Human Rights, told The Jakarta Post that the new rules had yet to come into effect.

"The minister (of justice and human rights, Yusril Ihza Mahendra) has yet to draft the technical guidelines for the implementation of the decree. We also need time to inform our offices of the decree," he said, adding that the new rules could come into effect within less than one month.

He said the guidelines would set out the administration and payment procedures to be applied at the country's ports of entry.

Investment and tourism experts have warned that the move will be a major setback for the country's economic recovery process.

Environment

President chides police over illegal logging

Laksamana.Net - April 8, 2003

President Megawati Sukarnoputri has urged police to cease their involvement in illegal logging and timber smuggling.

"Do not repeat the mistakes of police involved in illegal practices," she was quoted as saying by state news agency Antara during a visit to the Indonesian Police Academy in Semarang, Central Java, on Saturday.

Megawati, a keen gardener and former biology student, was at the academy to launch a regreening project.

"It is ironic that police are involved in smuggling amid the government's serious efforts to combat such illegal practices," said the president, who was accompanied by her husband Taufik Kiemas and National Police chief General Dai Bachtiar.

Also present were Trade and Industry Minister Rini Soewandi, Forestry Minister Mohammad Prakosa, State Enterprises Minister Laksamana Sukardi and the president's military secretary Major General Tubagus Hasanudin.

Megawati said she had first become aware of the need for regreening the Police Academy compound when she was vice president. The academy is located on 125 hectares land.

"I frequently plant trees, but the problem is who will take care of them so that the activity will not become only a ceremonial thing," she said. After ceremonially planting a tree, she said: "I want to know who will maintain this tree two hours later."

Police Academy chief Inspector General Ismerda Lebang said the institute has been planting trees since 1985 to create a water catchment area and an agrotourism destination.

Experts estimate 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 country's forests.

Environment Minister Nabiel Makarim last year asked Greenpeace to help the government combat illegal logging, but has said little about rounding up and jailing corrupt military officials, police and bureaucrats involved in the timber smuggling business.

Indonesia lost an estimated 40 million hectares of rainforests during the rampant plunder of forests that took place during the 32-year regime of former president Suharto.

The fall of Suharto in 1998 sparked an increase in the level of unsustainable logging, as powerful regional timber barons -- often linked to smuggling networks in neighboring countries and beyond -- took advantage of a breakdown in centralized control to take over from the state-sponsored exploitation of the nation's forests.

Environmentalists warn that at the current rate of deforestation in Indonesia, lowland forests will disappear from Sumatra by 2005 and from Kalimantan by 2010, while the Indonesian Forum for the Environment (Walhi) has said tropical forests will disappear from Papua within 15 years unless serious action is taken.

Many illegal logging bosses target national parks and use violence and intimidation to stop anyone who gets in their way. The problem is exacerbated by a lack of law enforcement, the complicity of corrupt police and military officials, and the government's abysmal failure to deal with the problem.

Jakarta considers nuclear power plant

Sydney Morning Herald - April 8, 2003

Jakarta -- Indonesia and South Korea are considering co-operating to build a $A334 million nuclear power plant in Madura Island just off the densely populated province of East Java.

"South Korea is very enthusiastic in co-operating with us in the construction of a nuclear power plant. They are even willing to bear the entire necessary investment," Research and Technology Minister Hatta Rajasa was quoted as saying in Bisnis Indonesia.

Mr Rajasa said the plant would have a capacity of 200 megawatts. The minister said the plant should come into operation in 2015 if the Government decided to go ahead with the project.

The Government previously shelved plans for a nuclear power plant on the north coast of densely populated Central Java province following protests from environmentalists and the 1997-98 financial crisis.

Health & education

Primary school students rally in Bandung

Jakarta Post - April 10, 2003

Bandung -- Hundreds of elementary school students staged a rally in front of the West Java provincial legislature building, demanding the local administration to waive their monthly school fees.

The students protesters, who gathered together from numerous primary schools in Bandung regency, marched down Jl. Diponegoro in the city center holding banners reading Mbak Mega, perhatikan kami (Mbak Mega, pay attention to us) and Indonesia maju tanpa pendidikan. Mimpi kali ye? (Indonesia progresses without education -- are you dreaming?) The protesters also demanded local authorities to repair education facilities and improve the quality of education.

Iqbal, a student at privately run Hikmah Teladan Primary School in Cimahi, said the monthly tuition at his school was between Rp 40,000 and Rp 60,000 per student, and that the fee had overburdened the students' parents, as they also had to purchase textbooks and uniforms annually.

Deden, a teacher who accompanied his students in the rally, said more than 30,000 children in the regency could not go to school because of financial constraints.

Armed forces/police

White Paper suggests more powers for TNI

Straits Times - April 10, 2003

Devi Asmarani, Jakarta -- Internal security and transnational crime will be the biggest threat to Indonesia's security and the military should be given more powers to handle them, a government White Paper released recently says.

Drafted by the Ministry of Defence, the White Paper lists radical movements, communal conflicts, terrorism and separatism as some of the country's main challenges in the coming years.

It also says that while the possibility of a foreign invasion or military aggression was low, transnational crimes such as piracy, illegal logging and people smuggling would dominate foreign security issues.

The paper recommends that the Indonesian Armed Forces (TNI) should be deployed to help the police deal with these challenges.

The White Paper is considered to be a preview of a Defence Policy paper that is to be released later this year.

If its recommendations are accepted, it would require a change in the current system, under which the military is in charge of only external defence while the police tackle domestic security.

Two decrees issued in 2000 by the National Assembly (MPR) on the separation of the TNI and the National Police and on the division of duties between the two forces would have to be revised if the White Paper's suggestion is accepted.

Before the decrees were issued, the police were under the military. After the separation, the police have had to deal with problems such as separatism, something they are not trained for.

Mr Yasril Ananta Baharuddin, of a parliamentary committee on security and foreign affairs, said limiting the military's role to external defence had contributed to the deterioration of domestic security in recent years.

As an example, he pointed out that the problem of separatism was dealt with by the military in other parts of the world. But that was not the case in Indonesia.

He said the two MPR decrees needed to be revised because they were drafted hastily in the 'spirit of reforms' following the fall of the Suharto regime.

Defence analyst Rizal Sukma of the Centre of Strategic International Studies told The Straits Times that the decrees had gaps in them, such as they did not spell out what would be the role of the TNI when there was no foreign invasion.

Currently, the TNI is involved in security operations in the secessionist province of Aceh and in sectarian conflicts in Maluku and Poso. But military leaders have complained that a lack of legislation to justify its activities there has made security operations ineffective.

Some human rights activists have, however, expressed fears that if the recommendations of the White Paper are accepted, the military's supremacy in the country will be revived.

Economy & investment

Indonesian state television: Battle of wills

Asia Times - April 10, 2003

Bill Guerin, Jakarta -- Cash-strapped state-owned television station Televisi Republik Indonesia (TVRI) has 7,158 employees and 395 relay stations in 26 provinces. It reaches out to 81.5 percent of the country's total population, or more than 169 million people, but is being slowly but surely forced off the air.

TVRI needs at least Rp2 trillion (US$225 million) to rejuvenate its old equipment, including its 400 relay stations across the archipelago, but last week broadcasts were halted in the Medan, the provincial capital of Sumatra, after its remaining operational funds had been used up.

Medan is the latest casualty in a war of attrition that belies government claims that the national channel is to be given a new lease on life as a state-owned entity. TVRI broadcasting services at other Sumatran stations, Lampung, Bengkulu and Aceh, have been inactive for six months, as has the station in Central Kalimantan. TVRI Semarang in Central Java may stop transmissions this month if expenses cannot be covered, putting 375 jobs at risk.

TVRI was set up in 1962, primarily to broadcast the Asian Games held in Jakarta, and was run by a yayasan (foundation) controlled by the now-defunct Ministry of Information. For more than three decades TVRI was notorious for its monotonous programming and was looked down on as being the government's mouthpiece. This image cost it a great deal in terms of popularity and partly explains its uphill battle for viewers in areas where there is a choice.

The die seemed cast for TVRI and those 70 percent or so of its audience who live in rural areas, where private TV channels are difficult to pick up, when the government decided to convert TVRI from a social-service corporation to a public-service company.

The new status was granted through Presidential Decree No 36/2000. Under the decree, TVRI changed to a Perusahaan Jawatan (Perjan), a non-profit state company under the authority of the Ministry of Finance. Its employees thus became civil servants of the Finance Department assigned to TVRI.

Then another chameleon-like change took place last April with TVRI metamorphosing into a state limited-liability corporation (Persero). Government Regulation (PP) No 9/2002 changed the status of TVRI from a Perjan to a Perusahaan Terbatas or limited-liability company (thus no longer enjoying a government subsidy).

From then on TVRI was sidelined and to this day awaits the formal conversion to a corporation with operational procedures, corporate rules, a chain of command, and assured funding. The government last year allocated Rp157.87 billion to TVRI, including salaries for 5,635 of its employees, but for its broadcasting operations alone TVRI needs at least Rp894.25 billion a year, excluding equipment maintenance and replacement costs. It needs an estimated Rp1.2 trillion every year but earns no more than Rp235.21 billion.

In this year's state budget (APBN) no operational funds at all are allocated. Ministry of Finance director general for budgeting Anshari Ritonga excused this farce by saying he was not informed of the pending status change until January; this in spite of a letter from TVRI on December 2 to the finance minister and the minister for state-owned enterprises (SOEs) requesting operational funds of Rp157.873 billion from APBN-2003.

Salaries for this year will be paid, but little else. As the employees retain the status of civil servants, their pay is secured from an item "ex-Perjan employees of TVRI" already allotted in the 2003 budget.

TVRI has been allowed to air advertisements for some time now but it faces formidable competition from the existing private stations. Prior to this it was not permitted to air commercials but received 12.5 percent of gross advertising revenues of privately owned TV stations SCTV, Indosiar, Metro TV, ANteve, RCTI and TPI. Most of these simply did not pay, claiming hard times. In October 2001, TVRI terminated its accord with the errant stations, citing Rp200 billion in outstanding claims.

TVRI president Sumita Tobing, who took over the reins in June 2001, was appointed along with four executive directors, Sutrimo, Badaruddin Achmad, Ahmad Adiwijaya and Barita Effendi Siregar, all of whom she later suspended.

Sumita, 56, has done her best to drag the company into shape ready for a proper restructuring. Unfortunately, her style of management has made her more enemies than friends, with almost every single TVRI director calling for her removal.

Though she breathed life back into the station with new and popular programs, Sumita is permanently under fire for what her critics say is a "one-woman show" style of management. Almost daily infighting at the station has met her attempts to purge what she describes as a complacent "civil servant" mentality that leaves only 10 percent of its workforce productive.

Sumita started with TVRI in the late 1970s. She left in 1992 to work for ANteve and in the interim became the first Indonesian woman to achieve a doctoral degree in broadcasting, at Ohio University, aided by a scholarship from TVRI. In 1993 she was headhunted by SCTV. After building the Liputan 6 news service into a national leader, she left because of disputes with top management. Then she went to Metro TV, Indonesia's first 24-hour news channel, before leaving there because of internal disputes.

In her second coming to TVRI she has been accused of being involved in corruption, appointing a non-employee of TVRI to lead a project valued at Rp100 billion, and a host of other such sins.

The leading lady suspended marketing director Sutrimo, administration and finance director Badaruddin, and a couple of other directors after accusations by them that her grip of iron left them on the sidelines.

By last November the government's game plan had changed. During the protracted debate over the new Broadcasting Bill, legislators succeeded in ensuring that the bill allowed for TVRI, as a national asset, to remain under the government's control.

The "keep it public" lobby argued that change of ownership would transform the state television station into a purely profit- oriented enterprise and said the government should do everything to maintain TVRI as a state-owned entity to maintain its social mission.

Funding for this social mission was never debated. Last month Sumita sent out circulars advising all TVRI regional stations to tout for loans in order to cover operational costs.

The mid-1990s saw most of the action in media empire-building. The regionally based network system of the time allowed some television stations, ostensibly with limited licenses to operate only in certain regions, gradually win permission to transmit across the country after large investments, lobbying and deals with the Cendana (Suharto) clan. The Jakarta media barons who currently control what is screened to 220 million people are mostly still relatives and associates of former president Suharto.

Other stations came on to the scene and raced to build relay stations in a bid to grab as wide an audience as possible. RCTI set up no fewer than 47 stations, and other channels built tower after tower to beef up their relay stations, despite only having preliminary licenses.

Thus, a television station with only one broadcasting permit was able to transmit nationally. Those halcyon days are now over.

The House of Representatives (DPR) passed the new Broadcasting Law last November 28 and thereby in effect ended the stranglehold of the Jakarta-based conglomerates and media magnates on television screens across the nation. Officials admitted openly that the purpose of the Broadcasting Law is to democratize the airwaves by breaking up the oligopoly of the Jakarta-focused stations.

Under the new law, the 10 major private television channels in Jakarta will no longer be allowed to broadcast their programs nationally. If a television station in Jakarta, for example, wants to expand its coverage to Surabaya (East Java), it must set up a joint venture with a local Surabaya station, which will then relay or rebroadcast the Jakarta-based station's programs via its frequency.

Conversely, a station based in the provinces must find a counterpart in Jakarta willing to relay its programs if it wishes to reach viewers in the capital.

This is how Indonesian radio stations operate, some of which have a network of 200 relay stations nationwide, and who are obviously under no threat from the new regulations.

The law grants existing private television stations that are already broadcasting nationally a grace period of five years, before having to fall into line.

Under the new law, local provincial or regional administrations, or their city-owned companies, can also set up their own public television and radio stations using money appropriated from the local budget. The establishment of these public stations is subject to the approval of the local council.

Even though no formal permits have been issued by the central government, there are already about a dozen locally based stations on the air in various provinces around the country and some 35 new regional TV stations outside of Jakarta are set to begin operation, posing a further challenge to TVRI, which has so far dominated the airwaves in remote areas of Indonesia.

Initial fears that some regional governments would try to lay claim to the state broadcaster's assets within their jurisdictions have proved to be unfounded.

The idea is that, with regional autonomy and the allocation of broadcasting frequencies to local communities, the provinces will no longer have Jakarta's broadcasts and views pressed upon them.

The law also provides opportunities for foreigners to invest. However, non-Indonesians can only invest in a TV station once it has gone public, and even then are only permitted to own a maximum of 20 percent, hardly likely to entice the foreign media barons.

Aside from the ominous dangers posed by the restriction of foreign news coverage and handing back ultimate control of the airwaves to the state, the bill has clearly been designed with the new post-Suharto political realities in mind.

After all, the strategic importance of television can hardly be underestimated given that, with voters able to choose a president directly in next year's elections, the reach of the Jakarta-based stations and their impact on the 120 million voters can be very powerful.

It is against this backdrop that the government is playing brinkmanship with TVRI. Ownership of a private television station will confer substantial political and financial benefits, but being financed by the government means an increased chance of TVRI being controlled by its political masters.

Industry experts point out that there are only two choices for the government -- either privatize TVRI or liquidate it. Sumita is all for privatizing the station, saying lack of professionalism of its personnel as well as poor efficiency have helped hasten its imminent demise.

She blames the mounting debts on years of poor and non- transparent management as well as corruption and "civil servant mentality". She says TVRI will never be able to improve its professionalism as long as civil servants run it and that once it becomes a limited-liability company, it will be rid of bureaucracy.

Gearing up for privatization would mean a purge of all the rent seekers and corrupt management and lead to a massive retrenchment program among its employees. The government is unlikely to risk yet another privatization pitched battle in the run-up to the 2004 elections. The short-term financial future for TVRI is likely to depend on the persuasive powers of the new management team rather than any strategic planning.

Sumita wants Minister for SOEs Laksamana Sukardi immediately to legalize TVRI's corporate charter as a Persero and appoint new executive directors and board members to replace the old leadership.

TVRI may obtain funds through Sukardi's ministry but these will only be forthcoming after it has completed the change to a limited-liability company.

Some idea of the government's attitude and the enormity of the dilemma for TVRI can be gleaned from Sukardi's comments. Questioned by reporters, he admitted that he already has the names of the new nominees to head up his new acquisition. "But I haven't opened the envelope," he said glibly.

Experts say country still needs the IMF

Jakarta Post - April 10, 2003

A'an Suryana, Jakarta -- The role of the International Monetary Fund (IMF) to oversee the country's economic reform program is still crucial to help maintain investor confidence in the economy, a seminar concluded on Wednesday.

But participants of the seminar said the government had to modify the IMF's current role in such a way that the fund would no longer dictate every detail of the economic reform programs Indonesia needs to implement. The function of the IMF should only be limited to a monitoring role, they said.

"The recommendations of the IMF are still needed to secure investor confidence, particularly the Paris Club," said Umar Juoro of the Habibie Center, a private think tank, which organized the seminar on Wednesday.

The IMF came to Indonesia in late 1997 after the country was hit by a regional economic crisis. In 1999, the government extended the IMF bailout program, which will expire at the end of this year.

There has been strong political pressure on the government not to extend the IMF's role when the program expires, with critics saying that the IMF's prescriptions have only worsened the country's economic woes.

An immediate consequence of ending the current IMF program would be that the country could no longer obtain a debt rescheduling facility from the Paris Club of creditor nations and the London Club of foreign private lenders, who have always based their decisions on recommendations made by the IMF. Thus, this could create serious difficulties for the cash-strapped government to repay foreign debts maturing in 2004 and in the years to come.

The government has formed a special team to explore various options if it has to conclude the existing IMF program.

A source at the Ministry of Finance said that one possible option was to modify the current role of the IMF. He said that the presence of the fund was still needed to maintain credibility in the government's economic reform programs.

Some analysts have said it was hard to imagine the country having the discipline to carry out tough reform programs without a credible institution overseeing it, particularly next year when a general election will be held.

Andrinof A. Chaniago, an economist with the Center for Indonesian Regional and Urban Studies (CIRUS), said at the seminar that the IMF should no longer be deeply involved in designing all aspects of the country's economic reform programs in the future.

He said that the IMF's core competence was in the area of monetary policy. He said that what the IMF had done in the past by intervening in microeconomic areas was a mistake. One example was the closure of certain banks in November 1997, which led to massive runs on banks.

"The IMF should now only concentrate on monitoring the monetary policy," he said.

Umar said that from the perspective of nationalism, the current dominating role of the IMF was unacceptable. "It would be very difficult to convince people, especially the legislators, if they knew that the policy was dictated by a foreign institution," he said.

Analysis: Indonesia economy weathers storms

United Press International - April 9, 2003

Sonia Kolesnikov, Singapore -- The Indonesian economy has so far proven robust, weathering the Bali storm of last October. During the first quarter, the government posted an unexpected budget surplus, while inflation steadily dropped and growth remained robust.

Though the weakening in domestic consumption is raising some concerns, especially if the severe acute respiratory syndrome spreads to the country, economists are optimistic about the macro-economic outlook for this year. But the real question is whether the government can push forward to achieve a greater rate of growth than the expected 3-4 percent.

"It's like driving a bicycle, there is the stability issue and how fast you can move forward. Stability has been managed, but the issue is now going forward," said Sanjeev Sanyal, economist at Deutsche Bank.

Pieter van der Schaft, an analyst at Barclays Capital, added: "The government released positive first quarter GDP growth and budget data on Tuesday. The data confirm that the impact of the Bali bomb blasts has been relatively short-lived in terms of its impact on economic growth and that fiscal consolidation efforts will likely come out at ahead of target in 2003."

While the government had forecast a budget deficit of $858 million for the first quarter, it posted a surplus of a $338 million, reflecting lower-than-targeted expenditures like a delay in civil servant salaries increases.

If higher oil prices are certainly helping oil-producing Indonesia, the budget surplus was also achieved despite a deferment of planned energy price and electricity tariff hikes and the impact of a one-off fiscal stimulus package in the aftermath of the Bali bombing.

"The achievement is a positive step in [the country's] fiscal consolidation efforts," Finance Minister Boediono said in a statement.

Economists agreed. "Going forward, we believe that Indonesia's progress on fiscal consolidation will be sustained as a result of the positive first quarter budget data, not least because the average annual one-month central bank certificate (SBI) rate will likely significantly undershoot the 13 percent assumed for the 2003 budget," said van der Schaft.

The SBI rate currently stands at 11.4 percent with further Bank Indonesia easing likely in coming months.

On Tuesday, the Indonesian central bank also estimated first- quarter GDP growth at 3.2 percent year-on-year, following a 3.8 percent growth in the fourth-quarter of 2002. The fall was attributed to a drop in consumption and compared with a 4 percent growth target for this year.

"In our opinion such a growth rate is a pretty good outcome, as negative base effects would normally have shaved about 0.9 percentage point off year on year GDP growth. Various economic indicators, moreover, suggest that the slowdown in economic activity is patchy with import growth rates decelerating from very high year on year levels in preceding months, but retail sales and motorcycle sales showing signs of a modest pick-up," noted van der Schaft.

Other data have been pointing to an improvement in the country's fundamentals. The Indonesian Bank Restructuring Agency was able to raise $640 million in the first quarter, mainly through the sale of property assets. This was 67 percent above target.

A steady rupiah has also helped inflation dropped significantly over the quarter. The central bank has said first-quarter inflation was 7.1 percent year-on-year, around half of levels seen a year ago, and compared with 10.03 percent in the fourth- quarter. The government has forecast inflation of nine percent this year from 10 percent last year.

"There is no doubt that from a macro-economic perspective there has been dramatic improvement. But now I think micro-reform are needed if the government wants to jack up growth [from current levels]," Sanyal said. He pointed to judicial reform, cutting down of bureaucracy, and the cleaning up of the banking system to re-orientate it toward lending.

Given that 2004 is a general and presidential election year, there are some concerns amongst investors that the government could throw caution to the wind and shift to more populist policies.

"I personally think this is unlikely," said Sanyal. "So far, the government has managed thing quite well. It is their political interest to stabilize the economy. Think people will be surprise by how conservative this government is." Economists anticipated the government policies over the next year to aim at slowly easing off from the International Monetary Fund program.

Price of doing business in Indonesia still high

Financial Times - April 10, 2003

Shawn Donnan and Taufan Hidayat -- When Singapore's ST Telemedia paid $630m last November for a 42 per cent stake in Indosat, Indonesia's number two telecommunications carrier, it was widely seen as a major accomplishment for the government in Jakarta.

The price for the state-owned stake was better than expected by most. The buyer seemed committed to building a credible competitor to the country's dominant carrier, Telkom. It all seemed to reinvigorate Indonesia's privatisation agenda, a key element of its four-year International Monetary Fund reform programme, and bode well for future sales of state-owned banks and other assets down the line.

Five months on, the Indosat sale is emerging as yet another cautionary tale of the lingering complications of investing in Indonesia.

ST Telemedia has been forced to weather protests by unions angry about a sale to a company controlled by the Singapore government. It has also faced parliamentary probing into what some nationalists see as the sale of a vital state asset.

There have been allegations of corruption levelled at officials from the ruling Democratic Party of Struggle (PDIP), who deny reaping a valuable commission. And this week, a diverse group, including former president Abdurrahman Wahid, and the sister of the current president, Megawati Sukarnoputri, said it would file a class action lawsuit to try to reverse the sale.

"The divestment of Indosat is against Indonesian law," Remy Sjahdeini, a lawyer for the group, said. "People think there is a national interest being lost. A state company that has dominated most people's interest has to be controlled by the government. If there is a divestment, a majority of shares should not be taken over by a foreign company." Mr Sjahdeini expects to file the lawsuit before the end of the month.

Just the threat of a lawsuit represents a daunting prospect for a foreign investor such as ST Tele-media. Indonesia's courts are renowned for their corruption and often elastic interpretations of the law.

The government has insisted it remains committed to the sale and ST Telemedia has reiterated its interest in Indosat as well. "We continue to view Indosat as a company with strong growth potential," ST Telemedia said last week.

But the loud opposition to the Indosat sale is likely to reverberate far beyond the individual deal, in part because of its rather blunt anti-Singaporean tenor.

The Indonesian Bank Restructuring Agency (Ibra) is in the process of selling one of Indonesia's leading banks, Bank Danamon. The leading bidder is a consortium led by Temasek Holdings, the Singapore government's investment arm and also ST Telemedia's controlling owner.

Singapore's interest is driven in large part by its fears about the stability of Indonesia. Many see its buying up of stakes in Indonesian companies as an attempt to shore up the economy and avoid social strife in the sprawling archipelago to the south of the far smaller island state.

But the reaction in Indonesia, where people have long been suspicious of any Singaporean intervention, has become increasingly paranoid as the island state has flexed its more powerful economic muscle in recent months.

The fears are unjustified, says Anton Gunawan, a Citibank economist in Jakarta. He also downplays any potential fallout. "It's still attractive to invest in Indonesia, especially for Singapore which is a close neighbour and knows Indonesia better than other countries." There are also suspicions about how much is ideology and how much is self-interest in some of the nationalist opposition to issues such as the Indosat sale.

Mr Gunawan and other observers believe there are other interests at play, chiefly politics.

Any nationalistic argument against the sale of Indosat or other assets may be first of all intended to embarrass President Megawati's PDIP, which many see as vulnerable. But its other purpose may well be to stake out a claim for something to fill individual political parties' coffers ahead of elections a year from now.

[Additional reporting by Taufan Hidayat.]

57 small islands ready for investors

Jakarta Post - April 10, 2003

Jakarta -- Some 57 small islands in Indonesia are ready to receive investors willing to develop businesses there, the fishing ministry's Director General for Coastal Areas and Small Islands Widi Agoes Pratikto, said here on Wednesday.

"Some investors in Jakarta have submitted proposals to invest in some small islands," Widi told Antara, adding that they include PT Putera Sekawan which wants to reclaim Nipah island in Riau province; and PT Hano Bali in West Lombok district and Riau islands (in Riau province).

He noted that 110 coastal areas could be developed into coastal tourist resorts. "Among them are Buton island in Southeast Sulawesi province; Maumere in East Nusa Tenggara province; and Sumeenep in Madura island," he said.

Dim prospects for Indonesia's power sector

Asia Times - April 8, 2003

Bill Guerin, Jakarta -- Eddie Widiono Suwondo, president of state power utility Perusahaan Listrik Negara (PLN), is struggling to bring the virtually bankrupt monopoly back into the black. Ironically, he has had help from the onetime arch-enemies of PLN -- the independent power producers (IPPs) who in effect own and run PLN's monopoly power-supply network.

In the early and mid-1990s, the Suharto government signed contracts with 27 IPPs. The government suspended most power projects in 1997 and urged PLN to renegotiate the contracts. This led to long disputes between the company and the IPPs.

PLN has now completed contract renegotiations with 20 of them in deals, which will all attenuate the company's severe financial burden.

The virtual force majeure caused by the plunge of the rupiah against the US dollar in late 1997 set PLN on a fast track to its current perilous state. While its revenue is in rupiah, it pays for its oil and gas and private power in dollars, as well as most of its borrowings.

Twenty IPPs have finally agreed to cut their power price to below 5 US cents per kilowatt-hour, which is lower than PLN's current selling price of Rp488 (5.42 cents) per kilowatt-hour.

Six out of the seven remaining contracts, all geothermal power projects. Wayang Windu, Sarulla, Kamojang, Bedugul, Dieng and Patuha power plants, are expected to be resolved by the middle of this year. The Karaha Bodas project remains in jeopardy after years of legal wrangling between its contractor and the state- owned oil and gas company Pertamina.

The Asahan hydropower plant, the Sibayak geothermal power plant and the Cibuni geothermal power plant were all renegotiated last December.

Power from Asahan will now cost PLN 4.6 cents per kilowatt-hour, from 7 cents under the old contract, and from Sibayak and Cibuni there has been a reduction from 7 cents to 4.7 cents and 4.45 cents respectively.

Widiono said last week that he would adopt tough policies in facing the critical years ahead and his first priority was to turn the company's poor financial performance around so to allow it to finance new investments in power generation and transmission.

PLN has made no new investments since 1998 due to a total lack of funds exacerbated by an almost total lack of commitment from the three administrations since former president Suharto stepped down in May 1998.

Since then PLN has been operating at a loss partly because the government has been progressively cutting electricity subsidies -- a policy forced on it by the International Monetary Fund (IMF).

Badly shaken by last September's fiasco when most of greater Jakarta was plunged into darkness for hours, the government is at last addressing major issues holding back PLN.

Rotating power cuts have been in place since the blackout resulting from a break in the transmission line feeding power from the giant 3,400-megawatt coal-fired Suralaya complex, west of Jakarta.

The country will suffer a serious power supply problem in 2004 and 2005 unless there is sufficient new investment in the power sector to generate more electricity amid fast-rising demands.

PLN's own master plan shows that electricity demand will grow by 8 percent annually. In order to cope with this $28.5 billion will need to be invested in new power generation, transmission and distribution investment up to 2010. Without this investment, the country will suffer a major power crisis.

Additional power demand until 2005 in Java alone is projected to be between 11,000 and 12,000 megawatts, and about 5,000-6,000MW outside Java.

The peak load in the Java-Bali grid can reach 16,000MW against an installed generating capacity of less than 18,800MW. PLN calculates a minimum power reserve margin of 30 percent to avoid extended blackouts in parts of Java during peak demand periods.

The decades of successful industrialization and development during Suharto's New Order has left the community almost wholly dependent on power. Unfortunately the national power distribution structure has a large gap between Java-Bali and other areas. The so-called electrification ratio -- a measure of the percentage of the population with access to power -- has reached 59.4 percent in Java and Bali this year. Sumatra, Kalimantan, Sulawesi and the eastern regions, including Papua, come in at 53.1 percent, 46.6 percent, 47.2 percent and 33 percent, respectively.

As the lights fade on new foreign investment prospects in Indonesia salvation for the beleaguered PLN is also at hand from the country's oldest ally -- Japan. Japan is one of Indonesia's largest foreign investors and trading partners. The Jakarta Japan Club (JJC) said last month it would try to assist PLN by improving its financial soundness and increasing the capacity of existing power plants.

JJC members are all Japanese businesses operating in Indonesia and are concerned about a secure power supply for the large number of manufacturing projects in Indonesia.

At the end of the month both countries inked a yen loan deal worth US$616 million to be used to expand the generating capacity of both the Muara Tawar and Muara Karang gas-fired power plants, just outside metropolitan Jakarta.

The 30-year loan, $465 million for the Muara Karang plant and $152 million for Muara Tawar, has a 10-year grace period and carries a 1.8 percent interest rate.

The agreement will enable PLN to raise the power generating capacity of the plants. When finished the capacity of the Muara Tawar power plant will be 1,225MW and Muara Karang will generate 720MW, more than double its existing 300MW capacity.

Construction of the rusting shell of the 1,200MW Tanjung Jati B power plant in Jepara in Central Java is also set to resume this month, after a tough two-year round of negotiations.

Hong Kong-based Hopewell Holdings Ltd's chairman Gordon Wu has been trying to get rid of his white elephant for almost two years. The Hong Kong-based infrastructure company owned 80 percent of the Tanjung Jati B project in Java.

Recently Wu announced he had sold. Hopewell will get US$215 million and the obligatory Indonesian "partner" in the project, 20 percent stakeholder PT Impa Energi will get about US$53 million. The remaining US$38 million will be used to pay outstanding contractors' bills.

The Tanjung Jati project began in 1997 with Hopewell as developer and Japanese trading giant Sumitomo Corp as the constructor. Sumitomo decided later to take over the leadership of the project and will now lead the construction due for completion by 2005.

Funding will come from the Japan Bank for International Cooperation (JBIC) and a syndicate of other Japanese-based financial institutions. The government will provide some modest financial support to guarantee the state retains part ownership with Sumitomo.

Once construction is completed, the power plant will be leased to PLN for 20 years, and after that the utility will fully own the power plant.

Financing for yet another plant has been restructured recently. The US Export Import Bank (USEXIM) will lend US$381 million direct to the Paiton power project that was first commissioned in 1999 but delayed because the government needed time to approve the funding for it.

USEXIM, along with the Japanese Bank for International Cooperation, Nippon Export and Investment Insurance of Japan and the US Overseas Private Investment Corp are the major lenders to the project.

In addition, commercial banks from the United States, Europe, Japan, Australia and other Asian countries and bondholders will play a minor role.

Industry analysts say this particular deal will act as a catalyst for US-Indonesia bilateral energy talks, which have been stalled for several years.

Paiton, mainly owned by Edison Mission Energy, GE Capital and Mitsui & Co, owns and operates a 1,230MW coal-fired power plant in East Java, the largest independent power project in Indonesia. PLN also claims it is trying hard to improve its efficiency. Part of this strategy is to use more gas than oil as a source of energy to generate power. Poor planning and judgment by bureaucrats and international agencies over the years have allowed Pertamina, the state oil and gas giant, to call the shots throughout the energy sector.

PLN's production costs are high and their rate of 7 cents per kilowatt-hour is higher than in some other Southeast Asian countries, where the rate is between 5 and 6 cents per kilowatt- hour but fuel components are considerably cheaper than in Indonesia. In Malaysia, for example, the state electricity utility buys gas for $1.60 per million British thermal units (MMBTU), while PLN has to pay state oil and gas company Pertamina $2.50 per MMBTU.

Last year PLN lost some Rp4.47 trillion (US$502 million). Accumulated losses since 1997 amount to Rp45 trillion ($5.05 billion). The government decision in 2001 permitting quarterly 6 percent increases in electricity prices was yet another an integral component of the recovery plans.

PLN has raised electricity rates by an average of 6 percent every three months since then so that by 2005 it can reach the commercial rate level of 7 cents per kilowatt-hour. The current rate is about 5.24 cents per kilowatt-hour after PLN raised its rates this year.

The subsidy has been reduced from about Rp800 billion a year pre-crisis to about Rp200 billion this year.

The current price level of Rp488 per kilowatt-hour is equal to about 5.42 cents, still lower than production costs. Tariffs do not properly reflect the regional costs of production. Logically the additional subsidies required for such a policy should be borne by the government, not PLN, but there is no sign of the government moving towards any sort of composite energy plan that would address such needs.

Also, this year's first hike in electricity prices coincided with the government's decision to raise fuel prices by up to 22 percent, and telephone charges by an average of 15 percent, prompting strong criticism from various quarters, including street protests by students and workers (see Mega price hikes fuel Indonesia's discontent, January 15).

For the first time ever industrial users are being wooed, with Energy and Mineral Resources Minister Purnomo Yusgiantoro promising last week that they would get a 2.5 percent discount on the next 6 percent rise in tariffs due out soon.

The idea is to prompt such users to analyze their consumption patterns and shift operations from peak time to other times.

This assumes that the PLN infrastructure and transmission system is capable of responding to changed demand cycles. This is far from the case at the moment. Insufficient capacity and problem of increasing demand has been exacerbated by transmissions bottlenecks.

Though PLN has enough installed capacity to just about meet demand for the time being, transmission bottlenecks mean that it is unable to transmit excess supply from East Java, where it is available, to West Java, where it is needed. For example, the Paiton complex, a mix of state and private coal-fired units on the East Java coast, is capable of producing up to 3,200MW of electricity. Of this amount, however, only up to 2,000MW has ever been utilized (even during periods of peak demand), with 1,400MW dispatched to West Java through the North Route 500-kilovolt transmission line and 600MW consumed locally in East Java.

The lack of a meaningful energy policy in resource rich Indonesia, with its abundant reserves of natural gas, and the government's failure to develop the potential of natural gas has cost PLN dearly.

One example alone highlights the folly. A 1,300MW plant in Central Java, Tambak Lorok, runs on oil and because of this costs PLN an estimated Rp600 billion ($58 million) a year more to run than the entire 3,200MW Paiton complex.

There are still palpable dangers of major power blackouts across the board, leading to social unrest or worse and a disruption of the economy. Three decades of growth under Suharto means that electricity is even more vital now than ever to the community. Not just the industrial sector, but home industries and small factories, even in the most rural areas, depend on power. Blackouts and rising costs hit them where it hurts most.

The stakes could hardly be higher. No power means no growth and high costs of electricity impact negatively on the efficiency of the whole economy. Major industrial users are already being asked to either halt production during the peak hours of 5-8pm, or to run their generators during that period -- or even to feed some of their surplus into the PLN grid. This is meant to reduce peak loads by 300MW this year and up to 400MW in 2004.

The light at the end of this particular tunnel is far from visible at the moment.