Aceh

Court showdown looming on who rules the province

Radio Australia - September 19, 2003

The division between Islamic and secular laws will be put to the test in the Indonesian province of Aceh, as the treason trial of five pro-separatist negotiators continues next week. The lawyer representing the men says his clients will claim that, as Acehnese nationalists, they only recognise provincial Islamic laws, and not those of the Indonesian state. The controversy looks set to heighten, as the accused seem determined to challenge Indonesian rule in Aceh through the courts.

Presenter/Interviewer: James Panichi

Speakers: Adnan Buyung Nasution, lawyer; Associate Professor Tim Lindsey, Director of the Asian Law Centre, University of Melbourne

Panichi: Human rights lawyer Adnan Buyung Nasution says the charges brought against his clients -- which range from treason to supporting acts of terrorism and "sinister conspiracies" -- are ridiculous. He says the men are academics, farmers and businessmen who had simply volunteered to help out with the Tokyo peace talks, which collapsed shortly after their arrest.

Nasution: "They were appointed as representatives of the GAM, participating in the negotiations, in which the Indonesian government accepted them. "So why the, in a sudden, when the negotiations failed, they were arrested and prosecuted? It's a very strange case to me."

Panichi: The trial, which is scheduled to wind up at the end of October, comes at a particularly delicate time for the troubled province. This week, a high-level Acehnese secessionist rebel and his wife were killed, in what the Indonesian army has described as a gun-battle with the military. Teungku Jaelani is the first rebel leader to be killed since a major military offensive against GAM began in May.

And according to Dr Nasution, the army's presence in a province which remains under Marshall law has created a climate of fear, in which his clients can't be guaranteed a fair trial.

But in what may be an attempt to harness local support, Dr Nasution has announced that as secessionists, the five men don't recognise Indonesian laws, and will call for the trial to be scrapped.

Nasution: "The defendants are of the opinion that Aceh people are free people who never joined the Republic of Indonesia, because they have been always a free, independent and sovereign country of Aceh."

Panichi: So, does that mean they don't accept the sovereignty of the Indonesian court in Aceh?

Nasution: "Implicitly, you are correct. If they don't recognise or accept the sovereignty of the republic, automatically they should reject -- make and exception, we call it, and objection -- the authority of the court. But there has been nobody there to reject that suggestion."

Panichi: But is that realistic? Is the Indonesian government likely to accept that point of view?

Nasution: "Certainly not. Because, from the perception of the Republic, and I think all Indonesian people, when we proclaimed independence against the Dutch, against the Japanese, that covered already the Aceh people. In fact, during the revolution, the Aceh people supported the Republic. But those defendants say that it was only individuals who supported the republic, and not the whole people."

Panichi: Dr Adnan Nasution, who has just returned to Jakarta from Acehnese capital, Banda Aceh.

But according to some observers, the move is purely political, and has no chance of succeeding under Indonesian law. Associate Professor Tim Lindsey is Director of the Asian Law Centre at the University of Melbourne.

Lindsey: "It is true that Islamic law does apply to a broader extent in Aceh than in does anywhere else in Indonesia. This is because of powers granted under regional decentralisation laws by the Indonesian parliament in Jakarta to the provincial government in Aceh. And the powers include an ability to make laws in relation to Islam, as regional regulations.

"And they've done this. They've created an Islamic court, and there are Islamic codes. But these will never override a statue produced by the Indonesian government. There's a hierarchy of laws which applies throughout the republic, and these make it clear that regional regulations are always overruled by national statutes.

Panichi: Well, in that case, how will the courts deal with this claim?

Lindsey: "Well, the courts will simply apply Indonesian law to Aceh, as a component part of the republic -- despite the fact that there are military hostilities going on there. They will simply apply the law relating to treason and subversion, try them, and they will be found guilty."

Soldiers to stand trial for torturing civilians in Aceh

Jakarta Post - September 20, 2003

Tiarma Siboro, Jakarta -- The martial law administration in Nanggroe Aceh Darussalam will immediately court-martial 12 soldiers on charges of torturing dozens of villagers in a move that seems calculated to show the international community the military's strong commitment to protecting Acehnese people's human rights.

Apparently angered by the mistreatment of the civilians, Indonesia Military chief Gen. Endriartono Sutarto regretted the incident, which could have the potential to damage the ongoing military operation, saying that despite the recent "reconciliation" between the soldiers, the victims and their relatives, the 12 military personnel allegedly involved in the incident would nevertheless be brought to justice.

"All the soldiers sent to flush out the rebels in the province have been ordered not to mistreat civilians but rather to win their hearts and minds so that the people and the military can together help each other to restore order and security," he said during a press conference at military headquarters in Cilangkap, East Jakarta, on Friday.

He added that the suspects would face a court-martial established by the military administration in the near future.

The incident occurred on August 31 when a group of 12 soldiers from the West Java-based Siliwangi Battalion were searching for an alleged rebel identified as Syaiful alias Siopon Cina in Geulumpang Sulu Barat village, North Aceh.

According to eyewitnesses, a number of villagers were beaten and tortured when they failed to provide information on the wanted man, who is said to have escaped on a motorcycle when the questioning of the villagers by the soldiers was under way.

Spokesman for the military operation Lt. Col. Ahmad Yani Basuki said that following the incident, the 12 soldiers had held a "reconciliation ceremony" with the villagers. He declined to identify the 12 or to say what charges would being laid against them.

In June, six soldiers were sentenced to between four months and five months imprisonment for the beating of civilians in Lawang village in Bireuen regency. The civilians were beaten up after they failed to hand over a rebel whom the soldiers claimed was hiding in the village. In the same month, three other soldiers were sentenced to three years and six months each for raping four Acehnese women when raiding a reported rebel stronghold in North Aceh. They were also dishonorably discharged from the military.

The military has been roundly criticized by NGOs and the National Commission on Human Rights for human rights abuses during the military operation.

Entering the fifth month of the operation, at least 304 civilians have been killed. Both sides have denied responsibility for the civilian deaths.

The New York-based International Human Rights Watch accused Indonesia of violating human rights in quelling the separatist movement, with one of the reasons being that Indonesia has refused to allow international organizations to directly distribute humanitarian aid in the province.

Indonesia rebukes human rights watchdog over Aceh

Jakarta Post - September 20, 2003

Fabiola Desy Unidjaja and Tiarma Siboro, Jakarta -- The government has played down the Human Rights Watch's accusation of gross human rights abuses in the ongoing military operation in Aceh, saying that such an accusation is groundless.

Foreign Affairs Ministry spokesman Marty Natalegawa told The Jakarta Post here on Friday that despite the loss of innocent civilians, the Indonesian government was obliged to protect the Acehnese people's human rights in the operation to wipe out the Free Aceh Movement (GAM).

"It is simply arrogant to accuse us of violating human rights, just because they are not able to access Aceh," he said when asked to comment on the international human rights watchdog's accusation.

Marty said the non-government organization (NGO) should not pretend to know what was happening in the resource-rich province and should not presume that the Acehnese people's rights had been abused.

New York-based Human Rights Watch's executive director Brad Adams accused Indonesia of having violated human rights during the military operation that has so far run for four months. "The Indonesian government should not be blocking humanitarian assistance at this critical juncture ... The people of Aceh could be facing a real disaster behind closed doors," Adams told the Post.

Adams also urged UN Secretary General Kofi Annan to take up the matter with the Indonesian President Megawati Soekarnoputri during her upcoming visit to New York. "Access to Aceh should be at the top of the international agenda for President Megawati," he said.

He also asked that the international community remind Megawati of her obligations to allow the distribution of humanitarian relief in Aceh. Megawati is slated to hold a meeting with Annan on Sept. 23 on the sidelines of the UN General Assembly session at the UN headquarters New York.

The Indonesian government imposed restrictions on foreigners entering Aceh, due to the martial law imposed on May 19 to restore security and order in the province.

The restrictions also applied to all humanitarian workers, from organizations including the UN, to travel around Aceh. Aid must be distributed through the government or the Indonesian Red Cross.

Marty said that the government has its own mechanism to supervise the ongoing military operation and ensure minimum civilian casualties. "We are thankful for their attention, but we want to underline that Indonesia itself has an interest in protecting its people and winning the ongoing war," he said.

Aceh on brink of humanitarian disaster: Human Rights Watch

Associated Press - September 19, 2003

Jakarta -- The United Nations must pressure Indonesia into allowing relief aid into its war-torn province of Aceh in order to prevent a full-blown humanitarian crisis from developing in the region of 4.2 million people, Human Rights Watch warned.

"The Indonesian government should not be blocking humanitarian assistance at this critical juncture," Brad Adams, one of the group's executive directors, said in a statement received Friday.

Indonesia introduced strict restrictions on foreign aid workers, diplomats and journalists trying to reach the province in May, when it abandoned a truce with separatist rebels and launched a massive military campaign to wipe out the 27-year insurgency. The cease-fire -- worked out with the help of the United States, Japan, and a number of Western countries -- had been seen as the best hope for achieving a political resolution to the conflict in the oil- and natural gas-rich province on the northern tip of Sumatra island.

Some 50,000 troops and paramilitary police backed by air strikes and naval bombardments are currently engaged in the offensive to root out about 2,000 guerrillas of the Free Aceh Movement and about 2,000-3,000 part-time fighters. The war has claimed the lives of more than one thousand civilians, rebels and government troops. Human rights groups have complained about the lack of access to the region, saying there were indications of massive abuses by government forces in villages sympathetic to the rebels.

They say the war has placed thousands of displaced civilians at risk by disrupting health care services and the distribution of food and medicines. "The people of Aceh could be facing a real disaster behind closed doors, Adams said. "It is time for Indonesia to open up the province to outside observers and to let humanitarian agencies do their work."

The New York-based group said that early warning signs of a humanitarian crisis had come by way of non-governmental organizations which have noted malnutrition and a shortage of water among civilians who have fled their homes during the fighting.

The statement urged UN Secretary General Kofi Annan to take up the matter with Indonesian President Megawati Sukarnoputri during her upcoming visit to the world body. It said Annan should urge Megawati to respect Indonesia's obligations to allow humanitarian relief to reach civilians. "Access to Aceh should be at the top of the international agenda with President Megawati," Adams said.

Indonesian generals initially said they would need six months to crush the rebellion, but have recently begun talking about a long war. Analysts have cautioned that the fighting could drag on indefinitely, and have criticized Megawati for lacking an exit strategy and alienating the Acehnese by relying exclusively on military force to solve the problem.

Ending Aceh revolt could take years - Indonesia army

Reuters - September 19, 2003

Jakarta -- Indonesia's military claimed partial success on Friday in a four-month campaign to crush rebels in Aceh province but said it needed more time to end the insurgency.

Indonesia put strife-torn Aceh under martial law on May 19 and launched a military campaign to counter rebels from the Free Aceh Movement (GAM) after peace talks failed to end a war that has killed more than 10,000 people since 1976.

"We admit that GAM's force has not been totally paralysed. However, in these four months their strength has been largely reduced compared to before," General Endriartono Sutarto told a news conference.

"We can't pinpoint when we can paralyse GAM. From past examples in the world, dealing with guerrillas can take decades." Asked whether the military wanted to push the government to extend the time-frame for martial law in Aceh, which is scheduled to end in two months, Sutarto said: "That's up to the president." "From our perspective, whatever the decision is, whether it's an extension or an abolition, we hope the momentum we have now can be maintained," he said.

According to latest military estimates issued on Friday, Indonesian troops have killed 839 rebels and captured 989 since May. At the start of the campaign, the military said GAM had around 5,000 members.

The military said 52 soldiers, 11 policemen and around 300 non- combatants have been killed during the offensive, including one foreigner.

Military counts on Aceh are hard to verify, especially after Jakarta issued a decree in June that restricts foreign media coverage and bars all foreigners from communicating with GAM.

Critics also attacked the decree for stipulating that all aid be distributed by martial law administrators and that foreign aid groups not communicate directly with Acehnese without approval from local authorities.

New York-based Human Rights Watch said in a statement on Friday the Aceh offensive may have sparked a humanitarian crisis and warned that without outside assistance local authorities might not be able to distribute food and supplies. The military offensive has prompted tens of thousands of residents to flee their homes.

The HRW statement triggered harsh words from Jakarta. "It's very arrogant for an agency like Human Rights Watch to think that because they can't get access to a certain place like Aceh, because they don't have eyes and ears and mouths therefore the situation there is closed and there must be rights abuses," foreign affairs spokesman Marty Natalegawa told reporters.

GAM's strength reduced: Endriartono

Jakarta Post - September 20, 2003

Tiarma Siboro, Jakarta -- Indonesian Military (TNI) chief Gen. Endriartono Sutarto claimed on Friday that government troops deployed in war-ravaged Aceh had significantly sapped the strength of the separatist Free Aceh Movement (GAM) in the four- month-old operation.

The four-star general, however, admitted that soldiers were still finding it difficult to arrest or kill senior leaders of Aceh rebels, who have been fighting for independence for the resource-rich province since 1976.

"I can't deny that GAM still exists and we have encountered difficulty in arresting or killing leaders of the movement because they have established a tough protection system," Endriartono told a conference organized to brief the media on latest developments in the ongoing operation in Aceh.

The government launched on May 19 a joint operation aimed at eliminating GAM from the country's westernmost province.

Endriartono said, after four months of a relentless military offensive, GAM members had been pushed to remote forested areas, preventing them from causing security disturbances to civilians, including the collection of "Nanggroe taxes" from local people.

The military has claimed that it has killed almost 1,000 GAM rebels and arrested 1,000 others in the four-month-old operation. Those arrested are currently undergoing police questioning, most, if not all, not accompanied by lawyers, contrary to what is stipulated in the country's Criminal Code.

TNI predicted earlier that GAM had around 5,000 active members and over 2,000 weapons. Endriartono refused to speculate on the current number of GAM rebels.

"Maybe their numbers have been reduced because they have returned to their normal lives as villagers, or even increased because more civilians have sympathized with then and joined the movement ... I don't know," Endriartono said.

The military has confiscated only 363 weapons so far from the rebels. The military has also lost 35 soldiers and six police personnel, with hundreds of others injured.

The military chief conceded that the operation had produced casualties among innocent civilians. Endriartono said so far at least 304 civilians had been killed and 140 others injured.

He also said the integrated operation would focus on humanitarian operations in the next two months and support efforts to strengthen local administrations there.

"While we continue hunting down GAM leaders, we [TNI] will focus on supporting other operations in Aceh so that the government can optimize efforts to revive local administrations in the province," Endriartono said. "We believe that a military operation is not the only solution to the Aceh question," he said.

Besides crushing the separatist movement, the integrated operation is also aimed at enforcing the law, strengthening the civil administration and providing humanitarian assistance.

Asked whether the military would propose that the government extend martial law in Aceh, Endriartono said, "The President has the prerogative over whether or not martial law should be extended in Aceh; I'm not in a capacity to propose anything." Nevertheless, he said that TNI would likely maintain the presence of some of its 35,000 soldiers in Aceh at least until after the 2004 general elections, to ensure that all Acehnese would be able to exercise their voting rights.

Indonesia is scheduled to hold the legislative election in April 2004 and a two-phase direct presidential election in July and September 2004.

President Megawati Soekarnoputri issued a decree in mid-May imposing martial law for six months in Aceh to allow government troops to eliminate the GAM secessionist movement from the province.

More than 10,000 people, mostly innocent civilians, have died since 1976, when GAM officially began its fight for independence from Jakarta.

Stop blaming others over Aceh

Jakarta Post Editorial - September 15, 2003

After blaming the press, human rights groups and anyone who expresses a critical view on the military operation in Aceh as obstacles to the failure of the government to speedily eliminate the Free Aceh Movement (GAM), the government has now found a new game to play: the Aceh local bureaucrats. The bureaucrats are not only seen as corrupt and unskilled but their loyalty to the Unitary Republic of Indonesia is questioned too.

The government boasts that the Indonesian Military (TNI) and National Police (Polri) have committed no wrongdoing during the almost four-month military operation. In other words, they are not responsible for the failure to achieve what the government had previously promised: The military operation would be a combination of military offensive, humanitarian mission and an acceleration of law enforcement.

Listen to what Coordinating Minister for Security and Political Affairs Susilo Bambang Yudhoyono said last Thursday: "There is nothing wrong with our security troops, both the military and police, prosecutors and the rest of the officials outside the administration."

One day later, the Ministry of Foreign Affairs announced the government's move to include GAM on the UN's list of terrorist groups, via the UN Security Council. Should Indonesia fail to convince the UN, we are worried that a new scapegoat will be found. The UN would be easy to blame -- as Indonesia blamed it after the defeat in the 1999 East Timor referendum -- as the primary source of the government's failure to solve Aceh problem.

Although it is very difficult to obtain objective data on the latest situation in Aceh due to the severe restrictions imposed on the media, we can guess that the number of refugees and students who cannot return home and go to school remains high. National media organizations refrain from sending their reporters there due to high security risks in the war-torn province.

The government has deployed 35,000 TNI personnel and 14,000 police to fight about 5,000 rebels. We do not have accurate data on GAM's real capacity but the way former Cambodian fighter Son Sann described the number of troops who fought against the Hun Sen government until the early 1990s could be indicative.

"The total number of my soldiers was much higher than you would expect, but also lower than I have often told you," he said to a reporter in 1989.

Back to Susilo's statement: We feel saddened that a prominent figure like this retired general still fails to see the truth, to act as a mature official and to confront the harsh reality of what is wrong with the government's strategy on Aceh. Does he think that after dismissing all bureaucrats who fail to prove their loyalty to the nation, peace will automatically come to Aceh and the rebels will easily be kicked out of the province?

When the Indonesian government was busy condemning the UN as the most responsible party for the decision of the majority of East Timorese people to say goodbye to their colonial ruler in 1999, the whole world saw us as a laughing stock. Most East Timorese had no wish to remain part of us because the government failed to win their hearts and minds.

The failure of the military solution in East Timor should be a reminder for Indonesia not to repeat the same stupidity. Indeed, the government has vowed not to repeat the East Timor fiasco, but still we are worried that the meaning of a mistake for the government may be different from that in the public perception.

We are afraid that President Megawati Soekarnoputri's government is of the view that the mistake is therefore limited to President B.J. Habibie's decision to allow the East Timor referendum. What we hope the government realizes is that the mistake was more about the failure of the military solution for East Timor.

President Megawati could order TNI to step up its military operation in Aceh, or to buy the most sophisticated weapons and jet fighters to kill the rebels. She could also force Acehnese people to say that they love Indonesia as much as she does. But she will never win their hearts and minds through the use of force.

We do realize that the government will not be interested at all in calls to halt the military approach in Aceh. Yet we are convinced that the resumption of dialog with the people and the use of peaceful means-remember GAM is part of Aceh society-is the only way to achieve a peaceful solution for the province.

A new political party is needed to solve the Aceh conflict

Kompas - September 17, 2003

Jakarta -- In order to resolve the conflict in Aceh there must be a new political party which does not have the mentality and methods of the New Order [regime of former President Suharto]. This new political party must have a concrete and clear agenda to resolve the Aceh problem and at the same time the problems of the Indonesian nation.

This issue was raised by Australian political observer Max Lane, in a discussion on the theme "Empowering the 2004 Elections to Resolve the Conflict in Aceh" in Jakarta on Monday September 15.

Lane said that if you look at the election laws and practices of almost all of the political parties at this time, in truth their practices reflect the mentality and methods of rule ala the New Order. "Is an election able to change this mentality and these methods of rule ala the New Order, theoretically it can. Meaning it must put forward an alternative so that ordinary people can vote for a political force which has a different mentality and method of rule", said Lane, extolling the example of Venezuela, where the government which is in power at the moment has its roots among the ordinary people.

According to Lane, the principal problem in Aceh is not in fact located in the mechanisms of the elections but rather because a political force without the mentality of the New Order is yet to emerge. Those in power with the mentality of the New Order government can only be confronted with concrete actions.

"There are those who say that there must be a new political movement, a new social movement, moreover [that there is a need] to build an alternative. At the abstract level all of this is true. But, I think that there is no use in talking in the abstract, talk concretely. Concretely means there must be a new political party which has a concrete program", said Lane. (LOK)

[Translated by James Balowski.]

Jakarta's war to be extended

Green Left Weekly - September 17, 2003

James Balowski, Jakarta -- Indonesian government officials and high-ranking military officers have been hinting that, despite the military's (TNI) much-touted successes in its war against the separatist Free Aceh Movement (GAM) in the province of Aceh, the so-called "integrated operation" may be extended beyond its original six-month deadline. This was confirmed by TNI chief Endriartono Sutarto on September 3.

Sutarto said the TNI is considering extending military operations in Aceh to April, when legislative elections are scheduled. Sutarto said that successfully holding the elections in Aceh, at the same time as other parts of Indonesia, is one of the TNI's goals.

Launched on May 19, the operation -- which is supposed to include a humanitarian component and the "empowerment" of the local administration -- has been dominated by a vicious military campaign to crush GAM. There have been reports of widespread human rights abuses by the military.

Sutarto told the September 4 Jakarta daily Kompas: "To safeguard the momentum of the success of the integrated operation, whatever decision is taken by the government, as long as GAM is capable of disrupting security, the military operation in Aceh will be needed. Therefore, TNI troop numbers in Aceh will be maintained until conditions are considered to be safe for life to return to normal."

Sutarto admitted that the TNI was having difficulties defeating GAM because it has resorted to "a strategy of guerrilla war". "A guerrilla war cannot be finished in one or two months. Our experience in confronting Darul Islam [which fought an unsuccessful campaign to establish an Islamic state between 1948-62] was that it required several decades. In East Timor, that took 23 years... The United States in Vietnam [fought for] decades and fled in disarray. There has never been a guerrilla force which could be dealt with in just three or six months", he said.

Indonesia's coordinating minister for politics and security Susilo Bambang Yudhoyono, speaking after a cabinet meeting, also confirmed to the September 4 Kompas that TNI and police troop levels would not be reduced in the near future. Yudhoyono explained that the government had never set a target of six months for the operation.

Data released by the Aceh police operational command on September 4 revealed that so far at least 319 civilians have been killed during Jakarta's war in Aceh, with 108 disappeared and 117 others wounded. Although lower than the numbers cited by human rights organisations, the figures are far higher than previously admitted by the military. An August 28 report by a coalition of non-government organisations found that at least 100 women have been raped in a similar period.

Civilians involved directly in hunt for GAM rebels

Jakarta Post - September 17, 2003

Nani Farida, Banda Aceh -- The ongoing military operation in Nanggroe Aceh Darussalam (NAD) appears to now be directly involving the participation of civilians, with around 1,000 villagers from Leupung district in Aceh Besar regency being drafted in to join troops in hunting down Free Aceh Movement (GAM) rebels hiding in the nearby forest.

Armed with daggers and other sharp weapons, the villagers combed the forest. After six hours they discovered two alleged GAM rebels, one of them already dead. The two were said to be part of a group of armed separatists who were involved in a clash with government troops on Sunday that killed seven rebels and a police Mobile Brigade trooper.

The dead man was identified as Buyung, 30, alleged to be the GAM leader overseeing Pulot village in the regency. The other man, identified as Mahdi, 20, appeared to be fatally wounded.

"We found Mahdi lying on the ground near the river," said Muzakir Sulaiman, the secretary of Pulot village. The forest in question is located in the Lamteh hills, 14 kilometers east of Banda Aceh. The people traveled to the forest in trucks and vans.

Public participation has been repeatedly called for by the military since its major offensive against the rebels was launched four months ago. In some places people have received paramilitary training to help them defend their villages from GAM attacks.

The Indonesian Military (TNI) has deployed 35,000 troops in NAD to crush the rebels, whose number is estimated at 5,000. The operation is supposed to end in November, but the TNI has asked for an extension, claiming that it wants to ensure that the Acehnese people can participate in next year's elections.

Some villagers joining the hunt said the move was aimed at persuading GAM members to return to their villages and accept the unitary state of Indonesia. But they failed to explain why they were carrying sharp weapons.

A villager, Cut Wan, said around 18 rebels remained in the jungle, nine of them residents of Leupung. The mountainous district contains six villages: Layeun, Meunasah Mamplam, Mesjid, Pulot, Lamseunia and Meunasah Bak U. The military has listed the district as a GAM stronghold.

Aceh Besar military commander Lt. Col. Joko Warsito claimed that the initiative for the search came from the villagers, and the military was providing backup.

The move, however, raised anxiety among the women whose husbands were participating in the search. "For us, it's not a good idea. We worry about possible retaliation from GAM, who may abduct our husbands when they are in the forest alone," a woman, Nursiah, 32, told The Jakarta Post. Some people said they believed the remaining GAM members had already moved on prior to the search.

As of Tuesday, the military claimed to have killed 875 rebels and arrested more than 1,800 others. The NAD Police revealed that at least 319 civilians had been killed and 108 had gone missing since the military operation began.

Separately, the secretary-general of the Indonesian Red Cross (PMI), Iyang D. Sukandar, said the organization had not received any news from either the military or GAM about the negotiations for the release of two television journalists, Ersa Siregar and Ferry Santoro, who were abducted by the rebels in June.

"We will only pick up Ersa and Ferry if the two sides strike a deal on the terms for their release," Iyang told Antara , adding that the PMI was not playing a mediatory role. The rebels have asked for a cease-fire to make the release, a condition that has been rejected by the military.

Military claim major arrest in restive Aceh

Agence France Presse - September 17, 2003

The Indonesian military said soldiers have shot and captured alive a rebel "governor" in Aceh province, marking the first arrest of a senior rebel leader since a major offensive began in May.

Dailami, 32, the Free Aceh Movement (GAM) governor of Central Aceh, was seriously wounded by government troops on the slopes of a mountain in Bireuen district Tuesday, said Major General Bambang Darmono, who heads the Indonesian offensive in Aceh. Dailami's wife, Suryati, 27, was also wounded, Darmono said.

They were to be airlifted from the mountain area by helicopter later on Wednesday, the general told reporters. GAM's chief spokesman could not immediately be reached for confirmation of Dailami's capture.

Military sources said troops were combing the slopes of Geuleungoh Mountain when they came upon three people gathering water from a river. "Indonesian Armed Forces troops were convinced they were GAM, so immediately fired warning shots. But the three of them fled so the targets were fired on," said an officer at the scene.

One bullet went through Dailami's left chest while another lodged in the right side of his wife's chest, the officer said. Their nine-year-old child was unhurt, he said.

After troops seized a satellite telephone and a book listing telephone numbers of GAM leaders in Aceh and abroad, Dailami confessed to his role in the rebel movement, the military said.

As of Monday, the military said 875 rebels had been killed since the military on May 19 began its effort to wipe out GAM by launching its biggest military offensive since the 1975 invasion of East Timor. More than 1,880 rebels have been captured or surrendered during the same period, the military said.

The military and police say they have lost 66 men, including a soldier who died Tuesday during a firefight in the interior of North Aceh. Four unidentified men suspected of being rebels died during the same exchange of fire, Lieutenant Colonel Ahmad Yani Basuki said.

GAM has been fighting for an independent Aceh on the northern tip of Sumatra since 1976.

West Papua

More troops, more tree stumps - coincidence?

Laksamana.Net - September 16, 2003

Just a few days after the Indonesian Defense Forces (TNI) announced plans to form new battalions in Papua, a prominent environmentalist has warned that illegal logging mafias are joining forces with crooked officials to plunder the province's rainforests.

State news agency Antara on Tuesday quoted Forest Watch Indonesia (FWI) director Togu Manurung as saying foreign mafias have entered the country via cooperatives supported by Indonesian officials. He declined to name the foreign mafias or the Indonesian officials.

Environmentalists say Indonesia is losing nearly 2 million hectares of forest annually, largely due to corruption and lawlessness. Manurung said about 60,000 cubic meters of timber have been smuggled out of Papua during the past month. Another 600,000 cubic meters were traded illegally over the past year, he added. He urged the government to take measures to stop the illegal trade, which is worth about Rp30.4 trillion ($36 million) annually.

A report released in February 2002 by the World Resources Institute (WRI), Global Forest Watch (GFW) and FWI said the rate of deforestation in Indonesia had doubled over the past decade. The report said forest cover fell from 162 million hectares in 1950 to only 98 million hectares in 2000. It warned that lowland forests had almost entirely gone from Sulawesi and were likely to disappear in 2005 from Sumatra and in 2010 in Kalimantan. Manurung, who lectures at the Bogor Institute of Agriculture in West Java, said Indonesia now only has only 96 million hectares of forest cover left and the level of deforestation is increasing.

Military budget

In October 2002, TNI commander Major General Endriartono Sutarto said the government was only able to meet 30% of the military's budget, while the remaining 70% comes from "a range of sources". Some of those sources are legitimate businesses and foundations. But some of the money allegedly comes from sources such as illegal logging, extortion, drug dealing and prostitution.

The military also provides security services for multinational companies such as gold mining giant Freeport and oil giant ExxonMobil. Some soldiers also profit by moonlighting as contract killers.

Critical non-government organizations, such as the Australia West Papua Association, say Papua has become the military's main source of illegal funds, with concessions being mapped out and allocated to a handful of powerful generals. And there may soon be more generals in Papua, with Sutarto keen to increase the number of permanently stationed battalions in the province from three to six.

Trikora Regional Military Command chief Major General Nurdin Zainal, who oversees security in Papua, last Friday claimed certain groups that initially opposed the plan had since changed their tune after talks with the military. He claimed that Papua Governor Jaap Salossa is among those who support the creation of the new battalions. Some district administrations have even expressed their readiness to provide land for the headquarters of the new battalions, he added.

The Trikora Regional Military Command's three battalions each have an average of 752 personnel and are supported by personnel from six non-organic Army battalions. Zainal said that in addition to the creation of the new units, the three existing battalions would be beefed up to 1,039 soldiers each.

'We must help the poor Papuan people!'

Local human rights groups say the presence of more battalions in Papua will only serve to increase the level of violence and deforestation in the province. The government has passed a decree to split Papua into three new provinces, each with its own military unit, claiming the move is necessary to boost development in the resource-rich province.

Critics say the cliche of "We must help the poor Papuan people!" is one of the main slogans used by government and military officials who support illegal logging. "Commercial logging has always been a loss deal for the community and a huge profit for the timber company," says the Papua branch of the Forest Peoples Alliance (FPA). The FPA says most of the logging business operators in the province are from Malaysia and China.

While Manurung did not name local officials who collude with the timber mafia, the FPA has singled out the Bupati (regent) of Sorong regency, John Piet Wanane, who is alleged to have issued logging permits for conservation forests. The FPA says Forestry Ministry officials have little motive to attempt to enforce the law "because bribes are regular practice".

Citing an example how forest destruction takes place on traditional lands, the FPA recounts the case of Kapatlap village on Salawati island. The village community intended to build a new church but had no funds and could only obtain money by finding a logging investor. The local district officer of Samate, Abdullah Fattah, sent a request to his boss Regent Wanane, who issued permits for four landowning families to each exploit 100 hectares of forest, the maximum size permissible under government regulations. The concession was picked up by PT Wahana Papua, an Indonesian company of Malaysian-Chinese investors. The company entered a contract with the village to pay the landowners Rp30,000 ($3.50) for each cubic meter of high quality timber. According to the FPA, the company ended up taking 14,000 cubic meters of logs from an area much larger than the concession of 4x100 hectares. The company is estimated to have sold the timber for $150 per cubic meter, while the village ended up with its new church (generously valued at Rp150 million) and an outboard engine. Each of the landowners reportedly received an initial payment of an outboard engine and Rp15 million in cash.

"Such appalling discrepancy between the mean income for the traditional forest owners and the entire community on the one hand side, and the profit made by the logging company, on the other side, is standard practice," says the FPA. "In quite a few cases companies not even fulfilled their contracts -- knowing too well how little power and legal means the villages possess," it adds. For so many Papuans, who have for centuries lived from the forests, the increased presence of Indonesian soldiers in their province does not bode for a promising future.

West Papua: The anatomy of betrayal

The Times (UK) Literary Supplement - September 19, 2003

["The United Nations and the Indonesian Takeover of West Papua, 1962-1969: The anatomy of betrayal" by John Saltford. Review by Julian Evans.]

With the spotlight abruptly taken off the United Nations on 17 March, we will never know how its alternative to a US-sponsored invasion of Iraq would have turned out. Belligerence would doubtless have been reached more slowly, and for that reason alone many millions of Arabs and westerners have cause to condemn the sidelining of the UN.

Yet after reading John Saltford's impressive analysis of an earlier UN mediation, we could be forgiven for thinking differently about the organisation we look to as our guarantor of justice. We could be forgiven, for example, for thinking that the UN was only sidelined because this time the foreign policy aims of the United States were too aggressive to be disguised. If President Bush had shown more subtlety, he could have got everything he wanted in Iraq, and the UN to rubber-stamp it.

The background to this book is that of decolonisation and America's postwar campaign for influence in southeast Asia. After the collapse of the Dutch East Indies, Dutch New Guinea (as West Papua was then known) should have been a candidate for self- determination. Its people's Melanesian cultural roots gave them nothing in common with their Indonesian neighbours.

But Achmed Sukarno, as President of the new Indonesian Republic, was determined to hold on to West Papua, and President Eisenhower supported him, up to a point. "A strong Indonesia," Eisenhower declared, "would provide the essential barrier to the spread of communism in the East" -- though regional rebellions against Sukarno were also being exploited by Washington, whose objective, as Saltford quotes from A. and G. Kahin's Subversion as Foreign Policy, was to "eliminate the Communist Party, weaken the army's strength in Java, and drastically clip the wings of, if not fully remove, President Sukarno". (Try substituting Ba'ath for Communist, Baghdad for Java, and Saddam for Sukarno -- are you getting this?)

The Dutch were unwilling to fight a war they could not win, and Kennedy followed Eisenhower's line. Portents of large mineral and oil deposits fortified Indonesian and US resolve. In 1962 U Thant, UN Secretary-General, was told to appoint a US diplomat, Ellsworth Bunker, to mediate, and in August of that year, under this cloak of UN impartiality, the New York Agreement was wheeled out. This provided for a temporary UN administration of West Papua, with interim control passing to Indonesia on 1 May 1963; a clause of astonishing offhandedness that did not include the words "plebiscite" or "referendum' stated that the Papuan people were to be consulted about their future no later than 1969.

West Papua is the first instance we have of the UN administering a territory, and it provides comparisons with later UN administrations in, for example, Kosovo. One obvious parallel is the extent of pressure that can be brought to bear by the United States for the UN to come up with the desired US solution.

From Saltford's evidence, however, the UN's own attitude was suspect: it was necessary to give the appearance of seeking Papuan self-determination, but from UN headquarters it was impatiently viewed as impractical.

Thus in April 1968, when the Bolivian diplomat Fernando Ortiz Sanz was appointed UN representative in West Papua, he was given only 16 staff to help oversee the West Papuans' "Act of Free Choice", for a territory the size of Spain (compare this to the 1000 UN staff sent to East Timor to oversee its referendum).

Ortiz Sanz comes in for plenty of justified criticism here. As UN representative he effectively sleepwalked West Papua into annexation by Indonesia. From a population of nearly a million Papuans the final vote in August 1969 was carried out among only 1026 "representatives" of regional councils, who under well- documented intimidation by the Indonesian military voted unanimously for integration.

At one regional vote a journalist told Ortiz Sanz that young Papuans protesting outside a voting hall were being thrown into trucks and driven away by Indonesian soldiers. Ortiz Sanz replied: "Our job is to see what happens inside." The most disgraceful aspect of this is that his attitude was corporate policy. Narasimhan, for example -- U Thant's deputy -- knew the vote was a sham, and is on record as saying that he didn't care.

Saltford's book, which ought to be required reading for UN officials and international law students, is based on declassified US, Dutch, British and Australian papers, plus UN archives declassified at his request. Within the constraints of his analysis he rightly implies that the need for remedy is urgent -- if only because for more than three decades these matters were not raised because the UN General Assembly legalised Indonesia's occupation.

A year ago international efforts were begun to urge Kofi Annan to review the UN's role. He has not done so yet. What about the Papuans? Nearly 40 years of violent repression by their Indonesian masters, including bombing and strafing of villages, have resulted in at least 100,000 Papuan deaths.

The Papuans have been prevented in every way from determining their future. They haven't benefited anything like appropriately from the natural riches of their territory.

One of the most interesting pieces of evidence Saltford unearths is the testimony of one Ian Morgan, Third Secretary at the British Embassy in Jakarta in 1968, who after a visit to West Papua reported that of the 100 Papuans he had spoken to, exactly 100 "made it clear they all wanted freedom".

His report also stated that an American company, Freeport Sulphur, had recently "struck it rich" in the Papuan highlands and was busy concealing the extent of its find in order to keep share prices low while it organised large-scale insider dealing. 35 years on, the Freeport mine sits on the largest gold reserves on Earth -- and has recently [NB March 13] been obliged to admit to US authorities that it has been paying $4-$6 million a year to the Indonesian Army for protection (payments first revealed by this writer 3 years ago).

Which gives an idea of what is truly at stake here -- not for the Papuans, for whom the question is their land and human rights, but for the Indonesians, Americans and other 'investors' in their territory. Money, since the Dutch monopolized the clove trade in the 17th century, has flowed out of these colonies like a current in the Arafura Sea. In that respect, brown on black colonialism is indistinguishable from its predecessor.

Labour issues

21,000 workers duped by insurers

Jakarta Post - September 19, 2003

Jakarta -- A labor observer warned the government of an emerging crisis from after some sort of tacit permission was granted to three unauthorized private companies to run an insurance scheme for workers employed overseas.

So far, the three companies have collected Rp 3.4 billion (US$400,000) from at least 21,000 workers who paid Rp 160,000 each in premiums.

"The three companies are not included on the list of five companies authorized by the Finance Ministry to run the insurance plan for Indonesian workers overseas," Luthfi A. Hamdoen, also a labor activist, said here on Thursday.

He chose not to identify the three companies, but recent reports claimed that PT Wali Amanah was one of the three that had been collecting premiums from workers employed in the Middle East.

Under the Article 8 of Law No. 2/1992 on insurance, the Finance Ministry has authorized only five insurance companies to for the insurance program for Indonesian workers overseas. The five are PT Asuransi Jasindo, PT Asuransi Bumi Putra Muda, PT Asuransi Bina Griya Upakara, PT Parolamas and PT Asuransi Jiwa Life.

"We should learn from the collapse in the past of an insurance company which collected US$28 million in insurance, which is mainly meant to protect the workers interests, but thousands of workers who got into some trouble in their work place had never received any support or compensation," said Luthfi.

'War on terrorism'

Jakarta police warn of more car-bomb attacks

Associated Press - September 20, 2003

Jakarta -- Indonesian police are hunting down a group of suspected terrorists who are prepared at "any time" to use car bombs and suicide attacks, the police chief warned yesterday.

Meanwhile, police arrested three more suspected Muslim militants in the central Javanese town of Solo, bringing to 18 the number rounded up in the past month in Indonesia. Officers seized a small amount of ammunition, two boxes of TNT and sulphur from the men, said police Lt-General Erwin Mapasseng. He gave no other details.

Police General Da'i Bachtiar said officers had learnt about the threat from the interrogation of suspects being questioned over last month's bombing of the JW Marriott Hotel in Jakarta that killed 12 people. "There are still some terror suspects who are in possession of explosives and they are prepared at any time to use them in car bombs or in vests worn around their bodies," he said. "We are looking for them." Gen Bachtiar was speaking at Jakarta's main mosque after meeting Muslim leaders, some of whom have complained that police were arresting Islamic activists arbitrarily and failing to inform their families.

Later yesterday, more than 50 Muslim activists protested outside the national police headquarters, calling on police to release 15 terror suspects arrested last month. The demonstrators said the suspects, many of whom were active in religious groups in Java, were innocent.

Police have arrested nearly 50 suspects in last year's twin nightclub bombings on Bali island that killed 202 people and the Marriott Hotel blast.

The larger Bali blast came from a car bomb, while a smaller device at a second club was detonated by a suspected suicide bomber. The Marriott blast originated from a car bomb that exploded outside the hotel's lobby.

The attacks have been blamed on the Jemaah Islamiah, an Al-Qaeda-linked militant group. Several key suspects in both strikes are believed to be at large. Security at offices, hotels and bars in Jakarta have been stepped up sharply since the Marriott attack.

Terror politics in Indonesia

Asia Times - September 19, 2003

Scott B MacDonald -- In early August, the JW Marriott Hotel in Jakarta was bombed. The bomber was an Islamic radical who drove a van into the front of the hotel, killing 12 people and wounding more than a hundred others. Most of those killed or injured were Indonesian. The Marriott bombing follows the Bali bombing of last October, two other bombings in Jakarta (one at the parliament), and an alleged plot to kill the country's president, Megawati Sukarnoputri.

Although Indonesian authorities are reluctant to admit it, the rise of Islamic terrorism runs the risk of polarizing society and endangering the relatively secular nature of the government. It also casts a large shadow over the future of the country's fledgling democracy as well as the attractiveness of Indonesia as a place for foreign investment. While the Indonesian government is a considerable distance from being ousted from power, local radical Islam and its foreign links to al-Qaeda and Jemaah Islamiya (JI) represent a very challenging problem with long-term implications for Southeast Asia's largest country as well as the rest of Asia.

There are two sides of the coin in looking at Indonesia and Islamic terrorism. On one side of the coin, Indonesia has a long tradition of a tolerant form of Islam, which has functioned as a support for political stability. It has also been a pillar of Indonesian nationalism, a force that helps bind the country together. This was especially the case during the struggle for independence in the 1940s. During the Suharto years, Islam was carefully controlled and there was an emphasis placed on maintaining a secular society, able to accommodate a Muslim majority, but carving out a tolerance for the Hindu, Christian and other smaller religious communities. With the end of the Suharto years and the advent of Indonesian democracy, the role of Islam in society suddenly became more central. Indeed, with the departure of East Timor, the overall numbers of Muslims as a percentage of the total population increased.

The other side of the coin is that as the Islamic face of Indonesian society has become more distinct and more mainstream, the door has also opened for radicals within the same community to emerge from the shadows, developing international ties to like-minded groups and recruiting more followers. Certainly the shift to a more open political system has brought about a higher degree of uncertainty in Indonesia. Together with the round-robin of presidential leadership since 1997 and tough economic times until recently, radical Islam has become attractive as it projects a clear-cut, simple answer to complicated issues.

Another aspect of the rise of radical Islam in Indonesia is that the political class is seeking to manipulate this force. With the unpopularity of the United States' war against Iraq and the close US alignment with Israel vis-a-vis the Palestinians, another Islamic people, radical Islamists have been quick to articulate their views and to find a sympathetic audience in the majority of Indonesians. This by no means infers that most Indonesians favor radical Islam or the creation of a theocratic state along the lines of Iran, or are inclined to attack the West and its allies. What it does mean is that radical Islam touches a sensitive spot in the country's identity -- the West has long looked down on Islamic peoples. In a sense, there is a feeling of grievance. After all, the Dutch long colonized Indonesia and took its natural resources. Western companies made money in the country, and Suharto was long supported by the United States. In addition, it is argued the International Monetary Fund (IMF) made life miserable for many Indonesians with its poorly conceived economic policies.

The danger is that elements of the political elite are still playing to radical Islamic groups, or at the very least pandering to public sentiment vis-a-vis the unfairness of an international order dominated by the United States. The comments of Vice President Hamzah Haz in calling the United States the "king of terrorists for its war crimes in Iraq" certainly must be seen in this context. Haz was responding to international criticism that Indonesia had been lenient in sentencing Abu Bakar Ba'asyir, the spiritual leader of JI, to only four years in jail. Haz is the leader of the conservative Islamic United Development party (PPP). He has, in the past, been willing to be seen courting some of the country's more radical Islamic figures.

While some groups are playing to the Islamic radicals, others remain strongly opposed or are waiting for their turn to take advantage of potential weakness in central authority. Megawati is conducting a war against Islamic separatists in Aceh (on the northern tip of Sumatra) and is seeking to contain separatists in other regions. At the same time, presidential elections loom early next year. If the president slips in conducting the war, if she pushes too hard on Islamic groups in a predominantly Islamic country, or if she appears to be in the lap of the United States, her political prospects are likely to weaken. Moreover, she must tread softly with the military. Any loss of power from the civilian part of the political spectrum could be gained by the military, one of the few cohesive institutions in the country. In the past, it has also been one of the most influential. If civilian leadership is inadequate, there are leaders within the armed forces that might be tempted to step into the picture, probably in the shadows, much like Indonesian puppet plays.

What complicates matters for Indonesia is that it is not a small, insignificant country. Rather, it is a pivotal nation, located astride major lines of communication and trade between East Asia and the Middle East and Europe. It is also the world's largest Islamic nation and a major producer of oil and natural gas.

For all these reasons, what happens in Indonesia matters. Consequently, the approach of the Megawati government to radical Islamic terrorism is a concern to more than just the local population. It is a point of concern to Washington, Tokyo, Beijing, Manila, Singapore and Manila. The failure to implement Financial Action Task Force (FATF) money-laundering regulations, which are aimed at hurting illegal financial activities in the country -- which could aid Islamic terrorist groups -- gives the impression that Indonesia is soft on tackling the problem.

Perceptions remain important in a globalized era -- like it or not. This is important for attracting foreign investment as well as how the country interacts with the rest of the region. While the United States has often pushed Indonesia too hard and has certainly played to the sense of Islamic grievance, Indonesia's political elite also has to consider its responsibility to its citizens in providing sustainable economic development, a better standard of living and clear government. Supporting men with bombs willing to kill their fellow Indonesians in grisly acts of violence is not going to build a better future for the country.

Agency calls for speedy debate of intelligence bill

Jakarta Post - September 19, 2003

Tiarma Siboro, Jakarta -- National Intelligence Agency (BIN) director A.M. Hendropriyono demanded on Thursday that the deliberation of the much-criticized bill on state intelligence be speeded up, saying the country urgently needed it to be passed into law so as to prevent terrorism.

Hendropriyono warned of possible legal problems in the future regarding the arresting of suspected terrorists in the absence of a proper legislative framework. He said that Law No. 15/2003 on terrorism, which was now being revised, failed to give the intelligence agency clear powers to prevent acts of terror.

"I will ask the Ministry of Justice and Human Rights to immediately finish the drafting of the intelligence bill as the current lack of a legal basis for intelligence operations will create problems in the future," Hendropriyono said on the sidelines of the launching of a book on national defense published by the University of Indonesia.

He was referring to the widespread controversy over the recent arrests of a number of people by the police in connection with their alleged links to terrorism.

The antiterrorism law, Hendropriyono said, did not specifically provide for preventive measures against possible acts of terror, but focused more on the legal measures to be taken against those suspected of committing terrorist attacks.

The government suspended the drafting of the state intelligence bill early in March due to mounting opposition from various sides, including Vice President Hamzah Haz, who said the bill could lead to civil rights abuses.

The bill, now with the State Secretary, would provide BIN with greater powers, including the right to intervene in the work of the police. Under the bill, BIN will be allowed to detain a person for 7 days for questioning without any right on the part of the detainee to be accompanied by a lawyer.

The detention period could be extended to up to 90 days, and in certain circumstances a person could be detained for up to 180 days. The place of interrogation and detention would be determined solely by the BIN chief.

Another article in the draft bill authorizes the BIN director to procure firearms for intelligence operatives. BIN had previously tried to have these controversial provisions inserted into Government Regulation in Lieu of Law No. 1/2002, which was issued following the Oct. 12, 2002, bomb attacks in Bali.

Hendropriyono played down the possibility of human rights abuses should the bill be enacted into law. "The state intelligence law will regulate what we can and cannot do regarding the questioning, which does not mean arrest, of a person linked to terrorism," he said.

'BIN supplies information to police'

Jakarta Post - September 19, 2003

Jakarta -- The national intelligence agency admitted on Thursday that it had supplied information and other important data for the police in the recent arrest of 15 Muslim terror suspects who have allegedly been linked to a spate of recent terrorist attacks.

But, National Intelligence Agency (BIN) Chief A.M. Hendropriyono declined to provide further details on what information had been given to the police and added that the complaints over the arrest were not warranted, as they were done according to the law.

"Of course, the police arrested the activists after learning from intelligence reports ... We [intelligence and police officers] analyzed the reports and I don't see any violation of the official procedure," he said on the sidelines of a book-launching on national defense published by the University of Indonesia.

Many have criticized the way the police arrested the 15 suspects who are still being interrogated to determine their role, in any, in a string of bomb attacks in the country.

The suspects, who were believed to be planning an attack on several other targets, including the National Police Headquarters, were arrested in respective hometowns, Jakarta, Bandarlampung, Semarang and Medan.

Hendropriyono accused the suspects' relatives of exaggerating the arrest to draw public attention and reiterated that the police had indeed issued warrants before the activists were captured. "Of the most importance is that we have strong evidence to arrest these suspects," he stated.

National Police Chief Gen. Da'i Bachtiar has said that the detainees' relatives were welcome to file a lawsuit against the police over the arrest, and the public could let the courts determine whether the arrest was legal or not.

Asked whether Indonesia had been under foreign pressure (United States, Australia and Britain) to join their global war against terrorism, Hendropriyono replied several questions: "How should we react to the recent series of terrorist attacks here? Would you say that there is no terrorism in the country? And... do you think that security officers should just sit back and remain calm in the face of such incidents?"

Meanwhile, the police in North Sumatra alleged that Abu Yasar alias Dhani Sitorus alias Awaluddin, one of the 15 detainees, had close ties with the eastern Asia's most wanted terror suspect, Hambali, an Indonesian now in US custody, as well as Imam Samudra who was sentenced to death in Bali last week for masterminding the Oct. 12, 2002 Bali bombings that killed 202 people, mostly foreign tourists, and injured more than 300 others.

Yasar, a resident of Medan, capital of North Sumatra, was captured in Lampung on Sept. 5 for his alleged involvement in the bomb blasts at three churches in May, 2000. At least 12 people were seriously injured in the attacks.

North Sumatra Police chief detective Sr. Comr. Satria Hari Prasetya said Yasar would be charged with violating the Emergency Law No. 12/1951 for the illegal possession of explosives for which he could face the death penalty. "We are still hunting another suspected bomber, identified as NS, who we believe may be holed up in Riau," said Satria.

Human rights group Imparsial demanded that the police clearly explain to the public why it arrested the terror suspects, and also address the allegation that they were being tortured during the interrogations. Imparsial's executive director Munir who is also the co-founder of the Commission for Missing Persons and Victims of Violence (KONTRAS), said that he was feared that the police were abusing human rights in these cases.

In related development, the police in the Central Java town of Karanganyar arrested last Friday a 39-year-old man, identified as Surono, who was allegedly linked to a terrorist group. There has been no confirmation from the police on the arrest, but Surono's wife Sundari told Antara on Thursday that several police officers returned her husband's motorcycle, shoes and money to her house. Sundari said she had called up her husband on his cellular phone several times but she could not get through. She also said she had not received a warrant from the police on the arrest.

Police to get new antiterrorist powers

Jakarta Post - September 19, 2003

A'an Suryana, Jakarta -- Anyone planning or persuading other people to commit acts of terrorism will in future be classified as a terrorist and thus could be arrested, a government official said on Thursday.

Abdul Gani Abdullah, the chairman of the government team revising the antiterrorism law, said the inclusion of the new provision in the law would allow the police to arrest anyone planning a terrorist attack even before the act was carried out.

"The planners of terrorist acts will be able to be arrested based on intelligence reports," Abdul Gani told reporters on the sidelines of a seminar on the Constitutional Court at the Ministry of Justice and Human Rights on Thursday.

He was quick, however, to add that before arresting someone believed to be hatching a terrorist plot, the police would first have to obtain an arrest warrant from the local district court in order to avoid human rights abuses.

The new preemptive element, Abdul Gani said, was included in the revisions of the antiterrorism law currently being drafted by the government.

Police investigators have complained that the existing antiterrorism law does not allow them to take preemptive action against terrorists.

Article 26 of the antiterrorism law states that law enforcers many only arrest terror suspects based upon prima facie evidence, and that suspects may only be held for three days unless an extension to this period is granted by the district court.

These requirements had hampered the government's efforts to combat terrorism, and thus the law needed to be revised so as to give more power to the security forces to act swiftly against terrorism.

The deadly Bali bombing in October 2002, which killed more than 200 people and injured over 300 others, and the JW Marriott Hotel bombing in Jakarta last month, had served as a wake-up call for the government to enhance its preemptive capabilities against terrorism.

According to Abdul Gani, the team revising the antiterrrorism law was set to finalize the revisions by the end of September, and was now waiting to hear the views of the Indonesian Military (TNI).

Previously, the TNI had asked for a greater role in combating terrorism. However, it has yet to spell out exactly what role it envisages for itself. "We are waiting for proposals from the TNI. Should no proposals from the TNI be forthcoming, we will complete the review by the end of September," said Abdul Gani.

Meanwhile, Yusril Ihza Mahendra, the Minister of Justice and Human Rights, gave assurances that the revised law would not give the power to the TNI and its intelligence services to arrest suspected terrorists.

The statement was made in response to public concerns that if the TNI were given the power to arrest suspected terrorists, the abuses of the past could well be repeated. "Only the police will be able to arrest suspected terrorists," Yusril stressed.

15 terror suspects linked to Bashir's heir

Straits Times - September 19, 2003

Devi Asmarani, Jakarta -- The 15 people arrested in the past month for allegedly plotting fresh terror attacks in Indonesia attended meetings led by the supposed heir of Abu Bakar Bashir.

Sources in the police told The Straits Times that the arrests of the 15 since last month for allegedly plotting more attacks in the capital would not have been possible if they had not been pursuing a group of people linked to Abu Rusdan.

Rusdan, arrested in April for links to last October's Bali bombings, has confessed to police that he had replaced the militant Islamic cleric as leader of the Jemaah Islamiah (JI) terror group.

Between April and the attack on Jakarta's JW Marriott Hotel on August 5, several more people were caught with explosives, arms and documents detailing their involvement in JI.

A high-ranking officer said of the arrests in the past month: "We failed to prevent that attack, that is why we moved fast this time before another strike." Police said the detained suspects had considered targeting several places, including the National Police headquarters and the Jakarta police's office.

None of them has been linked directly to the Marriott or Bali blasts, but some are believed to have harboured suspects involved in those attacks. Some in the group of 15 had held seven meetings since last year, the first of which was just five days after last year's Bali bombing attacks.

The October 17 meeting at the home of one of the 15 plotters in Tawangmangu, Central Java, was attended by Mukhlas, one of the chief suspects in the Bali bombings who is currently on trial.

At this meeting, they talked about the "success" of the attack and the plight of the families of the bombing masterminds. Rusdan led this meeting and other gatherings in the next few months, including one at the popular resort area of Puncak, west Java, about 150km from Jakarta.

Testimonies and confessions from him and other detained militants involved in other bombings helped police focus their investigations.

They began "picking up" the suspects on August 14 in hush-hush operations so as not to alert the other suspects they were after. The arrests were made separately in Lampung, Jakarta, and Semarang and Solo in Central Java. Police said they are still pursuing other suspects but the current media reports on the arrests might hamper their operation.

The arrests have been criticised because investigators only produced arrest warrants after picking up the suspects -- in some cases days later. Several of the suspects' wives said their husbands had been singled out because they had gone to Afghanistan to train for jihad.

One of those arrested, Bambang Tutuko, is a professor of engineering at the Universitas Semarang. Colleagues said he became a changed man after a four-month trip in late 1998 to Johor, Malaysia, where he said he was taking computer courses.

"He started growing a beard, refused to shake hands with women, and wore baggy pants that came above his ankle the way some of the hardline groups do," said one professor. "He also stopped participating in campus activities, but we never would have thought he was a terrorist." Bambang allegedly let his house in Tawangmangu be used by the suspects for meetings to plan the attacks.

13 more suspects arrested over bomb terror

Agence France Presse - September 16, 2003

Indonesian police have arrested 13 more people suspected of involvement in a wave of bombings across the country, a police spokesman said.

The arrests were made following information gained from several of the 10 suspects detained over last month's car bombing at the JW Marriott hotel in Jakarta, said Senior Commissioner Zainuri Lubis, a police spokesman.

Nine of the suspects were arrested in Jakarta, two in Lampung in southern Sumatra, and two in the Central Java city of Solo, Lubis said Tuesday. "All 13 suspects are now under questioning here in Jakarta," Lubis said, declining to provide further details.

Another spokesman, Inspector General Basyir Barmawi, was quoted by the Antara state news agency as naming the Jakarta suspects as: Ahmad Sofyan alias Tamin, Zaid, Rofi alias Solihin, Teten, Rachmat, Sukimin alias Babe, Zubair alias Lutfi, Farhan alias Syamsul Bahri and Muhaimin Yahya alias Siad.

Those arrested in Solo were Ikhsan and Suradi alias Abu Usman alias Abu Said while Ari Wibowo alias Mustofa and Awaluddin alias Abu Yasar alias Dani Sitorus were arrested in Lampung, Barmawi said. National police detective chief Erwin Mappaseng told reporters on Tuesday the 13 had held seven meetings in October 2002 and early 2003 to plan terror attacks, and to discuss the future of the families of fellow militants arrested for their roles in the October 12 Bali bombings.

"Some of those meetings discussed plans of new terror attacks but we have not yet obtained information on where they were to be launched," he said.

On Monday Mappaseng said the sessions were held sometime in October and in February in Central Java and at a hill resort not far from Jakarta.

The meetings were chaired by Abu Rusdan, who allegedly replaced Abu Bakar Bashir as the head of the Jemaah Islamiyah (JI) regional extremist network. Some were also attended by key Bali bombing suspect Mukhlas, Mappaseng said. Rusdan has been in detention since April and Mukhlas is on trial for the Bali blasts.

An Indonesian court early this month sentenced Bashir to four years in prison for participating in a plot to overthrow the government, but ruled he was not the head of JI.

Mappaseng said that one of the Lampung suspects, Ari Wibowo, knew that a bombing was being planned but he did not know then that it turned out to be the Marriott hotel attack.

Another of the arrested suspects, Awaluddin, is believed linked to a bombing in the North Sumatran city of Medan in May 2000 along with three other people acting on the orders of Hambali, an alleged senior leader of JI who is in US custody, Mappaseng said. "The others only participated in the meetings," he said. He said Muhaimin Yahya alias Siad was "the one who had made the preparations for the meetings."

Legislators on Monday questioned Bachtiar about the disappearances of Muslims with links to Afghanistan and the southern Philippines, but he told them that the arrests were not "abductions," Antara reported.

He said under anti-terror legislation passed this year, investigators can detain a terrorism suspect for up to seven days. "We arrested them according to legal procedures. The arrests were made by officers carrying arrest warrants. The officers also informed the families concerned about the arrests," Bachtiar said.

Indonesia has been hit be a series deadly bombings since 1998, including the Bali bombing attacks that killed 202 people and the JW Marriott hotel attack that left 12 people dead on August 5.

Government & politics

Cure for Mega's headaches? Resign, say rivals

Straits Times - September 20, 2003

Robert Go, Jakarta -- President Megawati Sukarnoputri's complaint this week that the job of running Indonesia gives her headaches has made political rivals, as well as a member of her own party, suggest a cure: That she resign.

Ms Megawati said on Wednesday: "All this time, I get headaches taking care of the country's business. One issue solved, another problem pops up. That one taken care of, and yet another takes its place." Her comments were made during a formal speech at the presidential palace in Jakarta to commemorate National Productivity Day.

The first to respond to Ms Megawati is Mr Nurcholis Madjid, a Muslim scholar who has said he would run in Indonesia's first direct presidential elections next July.

Cak Nur, as the Muslim leader is popularly known, said: "The President should not have said that. As a leader, she should project the ability to take care of problems. Megawati's comment suggests she is unfit and lacks the skills to be president."

Mr Yahya Zaini, a senior member of the Golkar party, agreed: "Before becoming leaders, we have to realise it would be a tough job. No matter how difficult it gets, the President has to bear that burden, and perform with enthusiasm." The MP added that Indonesia needs a strong leader. He singled out Malaysia and South Korea as countries with quality leadership.

Ms Megawati's comments ruffled feathers even among her own party -- the PDI-P. Mr Haryanto Taslam, a known critic within the PDI-P party, said: "If Megawati is getting headaches, then it would be best if she quits. People with headaches can't come up with correct decisions. If Megawati can't do the job, the party better nominate someone else for next year."

Analysts said critics are not simply taking potshots at the President less than a year ahead of elections, but are addressing the idea that the country is in the midst of a leadership crisis.

Common folk, in polls done by government and private researchers during the past year, have consistently indicated a declining faith in Ms Megawati's ability to govern. But at the same time, they have not indicated a clear preference for any other candidate.

However, the latest such survey, conducted last month by the Centre for the Study of Development and Democracy, showed 13 per cent of 3,000 respondents from across the country picking Security Minister Susilo Bambang Yudhoyono for their next leader. Ms Megawati placed second with merely 7 per cent of the votes.

In what analysts see as an expression of general disenchantment with Indonesia's leaders, an overwhelming 46 per cent of those polled said they could not decide, while 5 per cent said none of the politicians deserved to lead.

Mr Rizal Mallarangeng, director of Freedom Institute, said: "Support for Megawati is clearly declining, but she remains the strongest overall candidate compared to the others." He and other analysts said the President's "headaches" comment was a blunder, but no rival could really take advantage of that due to their own weak positions.

Mr Rizal argued: "As the incumbent, Megawati still has advantages. She should be able to move beyond the headaches comment."

80 trillion rupiah needed for fired civil servants

Jakarta Post - September 17, 2003

M. Taufiqurrahman, Jakarta -- The government would require the huge sum of up to Rp 80 trillion (US$9.5 billion) to cover the severance payments of tens of thousands of civil servants dismissed for being unproductive.

Sofwan Chudhorie, a member of House of Representatives Commission II on home affairs, from the National Awakening Party (PKB) faction, said the amount would be earmarked for such payments.

"The House budgetary committee will discuss soon with the National Development Planning Agency how to provide the funds, and we hope that they will be ready in the next fiscal year," Sofwan told The Jakarta Post after a meeting with State Minister of Administrative Reforms Feisal Tamin.

He was quick to add that the presence of a large number of underemployed civil servants was intolerable, as it would only add to the burden of the already cash-strapped government. "Reform of the bureaucracy must be achieved at all costs," he emphasized.

Earlier in the meeting, Minister Feisal told lawmakers that the government was mulling over a number of possible options that could be taken to gradually dismiss tens of thousands of civil servants, all involving a huge sum of money to be withdrawn from government coffers.

"We have prepared all that is necessary for reform of the bureaucracy; what we need now is provision of funds, which will require approval from the House," Feisal said.

He said that the funds would be earmarked for severance payments to one percent to two percent of around 3.6 million civil servants across the country. "I must concede that up to 55 percent of our civil servants do not perform their daily tasks properly," he added.

A few schemes have already been devised by the government by way of reform of the bureaucracy, such as golden handshakes for those who have worked for at least 20 years and who are older than 45.

Bappenas chairman Kwik Kian Gie said recently that 55 percent of civil servants across the country should be dismissed for not performing their daily tasks properly, and urged President Megawati Soekarnoputri to embark on speedy reform of the bureaucracy.

Feisal has repeatedly complained that 60 percent of the country's civil servants are both unproductive and unskilled, and has proposed laying off 40 percent of them. However, his proposal was rejected due to a lack of funds to cover severance payments.

On Monday, he disclosed that the government had been paying the salaries of about 109,000 civil servants whose whereabouts were unknown. The government has been paying out more than Rp 111.7 billion per month (US$13 million) in salaries to absentee employees. The figures surfaced after the government started a drive to update the data on all civil servants as part of its attempts to revamp the bureaucracy.

Indonesia's bureaucracy was rated the worst in the world, according to an international survey published in July last year.

Despite the inefficiency, Indonesia still lags behind other neighboring countries in terms of ratio between civil servants and total population. In Malaysia, civil servants are 3.68 percent of the total population and in Singapore the figure stands at 2.48 percent. Civil servants here account for only 1.8 percent of the country's population of 215 million.

2004 elections

'TNI should stay neutral in elections'

Jakarta Post - September 20, 2003

Jakarta -- The Indonesian Military (TNI) chief Gen. Endriartono Sutarto urged politicians on Friday not to invite the military back into politics and suggested that the institution stay neutral in the 2004 general elections.

"I ask the people to allow us [TNI] not to exercise our political rights," Endriartono told reporters. "If in the past we supported certain political parties in this country, now I ask politicians not to encourage us to get involved in this party or that party," said Endriartono, referring to the close-relationship between TNI and the New Order ruling party Golkar during Soeharto's 32 years of leadership.

Chairman of the National Mandate Party (PAN) Amien Rais said earlier that he would enlist a military officer as his running mate in 2004, when the country is expected to hold its first ever direct presidential election.

Under the amended 1945 Constitution, the presence of TNI in the House of Representatives will be scrapped in 2004, while the People's Consultative Assembly in 2009.

Observers slam KPU for lack of transparency

Jakarta Post - September 17, 2003

Moch. N. Kurniawan, Jakarta -- A number of organizations criticized on Tuesday the General Elections Commission (KPU) for its failure to consult the public in many of its roles.

"We respect KPU members who are independent and credible. But they have so far issued a number of questionable policies without the participation of the public," Laode Ida of the Center for Regional Development Studies (PSPK) told a discussion to evaluate the performance of the current KPU since its establishment last year.

Criticism also came from the Elections Supervisory Committee (Panwaslu) and the Center for Indonesian Law and Policy Studies (PSHK).

KPU is preparing for the direct elections of legislative members and the president next year.

Laode said that examples of KPU's poor performance included, traces of a mark-up in the distribution of population census forms, the extension of the population census period and its controversial decision to procure operational cars without a tender.

KPU also seems to be unaware of the unrest caused by its proposal to allocate Rp 649 billion (US$76.3 million) of its budget, which comes from taxpayers' money, to construct houses for its members, Laode said.

The absence of transparency in KPU, he added, was proven by its failure to make public all information via its website, including the process of some tenders, as claimed by several KPU members.

KPU was also considered weak in dealing with political parties, according to Laode, as apparent in its failure to punish parties that held election rallies under the mask of cadre gatherings.

KPU had said earlier it could not take action against the parties as such activities could not be considered election campaigns until the parties were declared eligible. The commission will announce eligible parties on December 2.

"We have seen KPU emerge as a super and overconfident institution that produces policies without public participation," Laode concluded. He warned KPU that it could no longer rely on the confidence of the public if it maintained its current standards.

Saut H. Sirait of Panwaslu and Bivitri Susanti of PSHK shared Laode's view. However, Saut said it was difficult for Panwaslu to discover any violations committed by KPU as the supervisory commission fell under KPU's auspices. He said it was the House of Representatives' jobs to supervise the KPU, but this was not the case due to various political interests.

In the absence of the House's control, Saut expected nongovernmental organizations (NGOs), such as PSPK, PSHK, and monitoring agencies including the Independent Committee for Election Monitoring (KIPP) and the Rector Forum, to take initiative.

Meanwhile, Bivitri suggested that the NGOs alliance promote public monitoring of KPU, and should file lawsuits against KPU for issuing policies that were not beneficial to the public.

Regional/communal conflicts

State of emergency in riot-ravaged Maluku islands lifted

Agence France Presse - September 15, 2003

Indonesia revoked a three-year state of emergency in the eastern Maluku islands, where clashes between Muslims and Christians have left more than 5,000 people dead.

Home Affairs Minister Hari Sabarno announced the end of the emergency during the inauguration of the new governor of Maluku province, Karel Albert Ralahalu, in the city of Ambon.

Sabarno said troops sent into the archipelago following the sectarian violence would be withdrawn gradually. "They still have a lot of work to do in other places," Sabarno said.

The minister said he hoped the improving security in the region would lure businesspeople to invest in the Malukus. "The situation is conducive to investment now," he said.

Jakarta imposed the emergency on Maluku and North Maluku provinces in June 2000 after Muslim-Christian violence erupted in Ambon and spread to other islands. The emergency in North Maluku was lifted in May.

Under the civilian emergency, the governor held the supreme command over the military and the police, and had the power to stop people from entering the province or any particular area, to ban public meetings and to censor press reports.

More than 5,000 people were killed and tens of thousands made homeless in the violence that was sparked by a trivial street dispute between a Muslim and a Christian in Ambon on January 19, 1999.

The dispute degenerated into a prolonged, bloody conflict, opposing members of the two communities. The violence quickly spread to the neighbouring islands in Maluku and Maluku Utara provinces. The government brokered a peace pact in February 2002 but sporadic violence has continued.

During the unrest, members of the two religious communities set up roadblocks between different sections of the city and killed any opponents they encountered in their areas. People had to travel across the Bay of Ambon in speedboats to bypass the roadblocks.

More than 80 percent of Indonesia's 212 million people are Muslims, but in some eastern regions, including the Malukus, Christians make up about half the population.

Human rights/law

Rights team verifies abuses in Bulukumba

Jakarta Post - September 20, 2003

Andi Hajramurni, Makassar -- A team from the National Commission on Human Rights (Komnas HAM) said here on Friday it had verified reports of human rights abuses by police during protests in Bulukumba regency, South Sulawesi, last July in which two people died.

There are indications that the violence on July 21 could be categorized as a serious crime, the team said. M.M. Billah, a member of the team, said the abuses ranged from the torture of suspects to the sexual harassment of female detainees by officers from the Bulukumba Police.

The torture directly involved Bulukumba Police chief Adj. Sr. Comr. Tigor Situmorang, Billah said in Makassar after returning from Bulukumba for a three-day investigation.

It was the second investigation of the incident by the Komnas HAM team, which also includes Hasballah M. Saad.

"The detained suspects told of being tortured by police officers. They said he [Tigor] took part in beating them. Female detainees said they were sexually harassed by officers, who ripped off the women's shirts and sarongs," Billah said.

He said the team also found evidence of procedural violations in the arrest of the suspects, with the police failing to produce arrest warrants.

Komnas HAM also verified a report that members of the police's elite Mobile Brigade escorted workers from rubber plantation company PT London Sumatra (Lonsum) as they destroyed crops belonging to local residents.

According to the police, two villagers were shot and killed by officers when some 1,000 villagers in Bulukumba protested on July 21 against what they said was decades of occupation of their ancestral land by Lonsum. However, non-governmental organizations put the death toll at five. Dozens of others were injured. After the incident, most of the male residents of at least two villages near Lonsum fled into the forest to avoid security personnel.

Tigor Situmorang, his deputy, Comr. Gatot Budiwiono, and nine other officers were questioned by South Sulawesi Police detectives over the deadly shooting. It is not clear whether the 11 officers have been named suspects in the case, but South Sulawesi Police chief Insp. Gen. Jusuf Manggabarani said detectives found indications of procedural violations as Tigor and Gatot did not brief their officers before deploying them to quell the protest. Billah said his team was seeking to question the 11 police officers allegedly involved in the shooting.

However, he said it would likely be difficult for Komnas HAM to get access to the officers because the case was still ongoing.

Billah said the team's findings would be discussed at a plenary session of Komnas HAM, and recommendations would be made on how to proceed.

After the protest, the Bulukumba Police arrested at least 29 people. The suspects included several non-governmental organization activists and a member of the Bulukumba Elections Commission, Iwan Salassa.

Tigor said his office was searching for 26 more suspects for their alleged roles in the unrest.

Disputed water bill stays unchanged

Jakarta Post - September 19, 2003

Fabiola Desy Unidjaja Muninggar Sri Saraswati, Jakarta -- Despite considerable public opposition, the House of Representatives began on Thursday to review the controversial bill on water resources but early indications appear as if there is little commitment to make significant changes into the bill.

In the meantime, President Megawati Soekarnoputri called on all sides to give special attention to the contentious bill to prevent a water crisis in the future.

House Commission III with deals with agricultural issues made minor changes to the bill, which was scheduled to be endorsed earlier this week, in its additional deliberations with the Director General for Irrigation at the Resettlement and Regional Infrastructure Ministry Roestam Sjarief.

Erwin Pardede, a commission member, said his commission was looking over the contentious articles but made no major changes to accommodate the public's opposition.

He said the commission and the government decided to review the draft law "and both sides approved certain (contentious) articles." He conceded that both the commission and the government were still divided over one article in particular, as it stipulates the establishment of a regulatory body to issue water permits.

The bill, designed by the Cabinet, has met strong opposition from numerous sides, including local non-governmental organizations, which accused the government of commercializing water resources rather than preserving it and allowing more access to a majority of the people for daily consumption and farming.

The bill is meant to regulate the issuance of permits for commercial water use and household/office use, but it falls short of preventing the possible monopolization of water. In addition, the bill also requires farmers to request a permit (for a fee) from the authorities to use irrigation water for farms.

Budi Santosa Wignyosukarto, the program coordinator from Gadjah Mada University, expressed disappointment that the House and the government had not made significant changes to the controversial sections. "They've merely reworded some bits with softer words on the controversial articles but the substance has not been changed," he said on Thursday. He said that in the absence of significant change, the bill would only benefit wealthy people who had access to water.

Fellow scholar F. Wijanto Hadipuro from the Sugijapranata Catholic University in Semarang, Central Java, concurred, saying that the government would have no mechanism at its disposal to control market-based water management.

He warned against a possible cartel of private companies who would control all the water if the House and the government approved the bill. "The water resources are quite likely to be monopolized since it will require a large investment. Without stern regulations, the government would not be able to guarantee access to clean and affordable water for the people who earn their living on traditional farms. "I am not sure the government will have any control," Wijanto remarked.

A number of NGOs have accused the government of being indirectly pressured by multinational corporations to endorse the law so they could invest in the water commercialization in the country.

They claim that both the government and the House were being pushed by such companies, as well as the World Bank, to endorse the bill in October so that the World Bank could disburse the remaining US$150 million from the agreed $300 million. The World Bank disbursed the first $150 million recently to finance the water reform program, including the privatization of water resources.

Meanwhile, President Megawati called on the public to preserve water to prevent another crisis next dry season. Everyone has his/her own obligation to preserve water resources, especially in their daily consumption, she said in Bogor on Thursday. "We should not wait for a water crisis to hit us, before we being conserving," she stressed, warning of another major water crisis in the country in the next decade, if people failed to conserve.

Jakarta amends dirty-money law to get off global blacklist

Straits Times - September 17, 2003

Devi Asmarani, Jakarta -- Indonesia yesterday amended a money- laundering law to curb illegal flow of funds and get the country off an international blacklist.

The much-awaited amendment to the 2002 Law on Money Laundering includes the tightening of procedures on financial transfers to comply with international standards.

It was passed by Parliament after a month of deliberation following international pressures on Jakarta to amend the law perceived as being too weak to put a check on illegal transfers of funds involving transnational crime organisations or terrorist networks.

Indonesia has been urged to tighten its security and deny terrorists access to funds after a car bomb outside Jakarta's JW Marriott hotel killed 12 people last month, the second major terrorist attack in the country since the October 12 Bali bombings.

The amendments passed by Parliament yesterday include the removal of a clause that limits investigations to only transfers of funds above a 500 million rupiah threshold. "We can investigate even one cent of money transferred," said Minister for Justice and Human Rights Yusril Ihza Mahendra. He said the amended law was made according to the standards set by the United Nations.

Mr Yusril said the amended law would also help the authorities investigate and prosecute the "original crimes" involved in the money laundering cases. These original crimes include corruption, smuggling of goods or people, embezzlement, illegal drugs trafficking, arms or people trafficking, kidnapping, terrorism, thefts, gambling and tax evasion, he said.

Banks and other financial institutions are obliged to report to the authorities any suspicious transfers of funds within three days, as opposed to 14 days in the previous law, after they detect the suspicious transfers. Violators face five- to 15-year jail terms and between 100 million rupiah and 15 billion rupiah in fines.

Mr Yusril said the law would help the country regain international confidence in its banking system, facilitate local businessmen in international commerce, and encourage investors into Indonesia.

Indonesia passed the law on money laundering last year but a task force to combat illegal fund flows set up by the Paris-based Organisation for Economic Cooperation and Development said it was not enough to check the flows of illegal money.

The agency kept Indonesia on a blacklist of nine countries in June and gave the country until October 1 to improve procedures. Other countries on the blacklist have been dealt with through sanctions for failing to improve their system.

Ukraine has seen 40 accounts belonging to its banks closed in several Western countries. But Indonesia has been spared from the sanctions, pending the amendment.

The amendment been hailed by businessmen and observers although they said the most important aspect in battling money laundering was the law enforcer.

Laksamana lambastes ludicrous lawmakers

Jakarta Post - September 17, 2003

Rendi A. Witular, Jakarta -- State Minister for State Enterprises Laksamana Sukardi erupted in anger on Tuesday during a hearing with House of Representatives legislators, blaming them as the main culprits behind the government's failure to meet the privatization target and schedule.

"How can we work if you [the legislators] keep on wasting our time by asking insignificant questions, and ... quarreling with each other. With all due respect, I don't see any point to this hearing," said Laksamana.

Laksamana made the remarks during a hearing with the House of Representatives Commission IX for financial affairs on the progress of the privatization of state-owned companies.

Laksamana said that it was the House's complicated stance and inconsistency that stalled the privatization program. "Now you go this way, then that way. There is uncertainty here. I feel like a ping pong ball when dealing with you guys. If you remain like this, the privatization process won't go ahead," Laksamana said.

Based on the existing laws, the privatization of state-owned companies should be approved by the House. But, the House only grants approval after long drawn out debates, which has forced the government delays and meant the disruption of the privatization schedule.

During the hearing, Laksamana asked for the lawmakers' approval for several state-owned firms, but the lawmakers just continued to ask questions, some of which had already been answered and others that had nothing to do with the subject. That went on until the end of the House's official working hours at 5:30 p.m.

The legislators then requested Laksamana to deliver his replies to those questions at the next hearing slated for October. That sparked an hour more of debate among legislators.

Laksamana interrupted the debate, saying he had no time to attend the next hearing just to deliver his answers to their questions. He argued that the questions asked by the lawmakers were mostly not worthy of replying to because he had answered them in the past and that several questions were personal and had no relation to the privatization process.

The lawmakers were stunned at hearing Laksamana's statement, but surprisingly they did not try to argue further. The Commission then decided to postpone the hearing indefinitely.

According to Laksamana, there are currently 18 state-owned companies that the government failed to sell in 2001 and 2002, partly because of protracted debates at the House. Among them are pharmaceutical companies PT Indofarma and PT Kimia Farma, shipmaker PT Dok Kodja Bahari, paper producer PT Kertas Padalarang and Soekarno-Hatta International airport operator PT Angkasa Pura II.

For this year, the government planned to privatize 10 companies: Bank Mandiri and Bank Rakyat Indonesia, gas distributor PT Perusahaan Gas Negara, construction companies PT Adhi Karya and PT Pembangunan Perumahan, and five construction consultant firms PT Indah Karya, PT Indra Karya, PT Virama Karya, PT Yodya Karya and PT Bina Karya. The government also plans to sell minority stakes in several companies such as in cement producer PT Indocement, this year.

Laksamana said that, based on the state budget, the government hoped to raise about Rp 6.2 trillion (US$738 million) from privatization programs this year. However, as of August, proceeds from privatization had only reached Rp 2.54 trillion, all from the sale of part of the government's stake in Bank Mandiri.

Reconciliation & justice

Experts doubt merit of reconciliation commission

Jakarta Post - September 20, 2003

Moch. N. Kurniawan, Jakarta -- Experts and human rights activists have expressed doubts over the effectiveness of the planned Truth and Reconciliation Commission (KKR) to resolve past human rights abuses, saying it would merely expose some facts but would not result in true justice.

Rachland S. Nashidik, program director of the Indonesian human rights group Imparsial, said the process of the KKR would only result in forgiveness, but human rights abusers would never get justice for their crimes.

"If we only seek truth, we do not have to set up a KKR. We just need a thorough investigation [by existing institutions]. For me, the KKR, as stipulated in the current bill is meaningless," he said after a discussion on transitional justice and the contribution of a truth commission. "We should also have a mandate to bring about justice via the courts," he added.

He also warned that such a commission would quite possibly become an instrument to whitewash all human right abuses that have taken place, thereby exonerating the perpetrators entirely. Therefore, Rachland called on the House of Representatives to postpone the endorsement of the bill until the inauguration of new legislators next year.

Under the present bill, there is no clause stipulating that those found guilty of violating human rights, would automatically be tried in court. The bill states that cases that are resolved by KKR will not be brought to court.

The country now has a human rights court, but it only has a mandate for the alleged human right violations in the Tanjung Priok incident in 1984, and the 1999 bloodshed in East Timor.

Priyambudi Sulistiyanto, a lecturer at the National University of Singapore, also expressed pessimism over the proposed role of the KKR in resolving past human right abuses. He stated that there would be no guarantee that those found to have violated human rights would confess their crimes. Furthermore, there was no record of other Southeast Asian countries succeeding with similar truth commissions as part of efforts to resolve human rights violation cases, he added.

"However, as a process in this transitional period, we should not oppose the establishment of the KKR as one alternative solution," he said, adding that the KKR process must also be conducted along with other possible solutions.

Baskara T. Wardaya, lecturer of the Sanata Dharma University, concurred with Priyambudi. He said the commission should become the impetus to resolve rights violations but not the only solution.

Rights trial on 1984 Tanjung Priok massacre opened

Agence France Presse - September 15, 2003

An Indonesian rights court opened the first trial on the massacre of 33 Muslim protestors in Jakarta's Tanjung Priok harbour area 19 years ago with an army captain and 10 soldiers as defendants.

A five-member panel of judges presided over the trial of Captain Sutrisno Mascung, who was a second sergeant leading a team of 10 soldiers when the shooting of Muslim protestors in Tanjung Priok took place on September 12, 1984.

One of the defendants, an army private, was unable to attend with the lawyers saying he was sick.

The defendants are charged in the 50-page indictment document with crimes against humanity by killing civilians and face between 10 years in jail and the death sentence if convicted, court officials have said. They are accused under a 2000 law on human rights and the penal code.

The Central Jakarta district courtroom was filled with at least 40 uniformed soldiers and scores of family members of the massacre victims, mostly wearing white T-shirts.

Some 60 families of the victims have already reconciled with the military, signing in March 2001 a document saying they had made peace with the soldiers they had previously accused of the killings.

The peace pact was the initiative of former Jakarta military commander and vice president Try Sutrisno, who will not stand trial for the killings despite a push by human rights groups for his prosecution.

Dewi Wardaw, the widow of Amir Biki, a leader of the crowd killed in the incident, said that she has refused to sign Sutrisno's peace pact "because it will run against what is in my heart. I will betray my husband and the other victims of Priok in their graves."

During the incident troops opened fire on Muslim activists gathering in North Jakarta's Tanjung Priok port area to protest the autocratic rule of then-president Suharto. An investigation by the National Commission on Human Rights found that 33 people were killed and 55 injured in the shooting spree. Relatives of victims claimed that scores were killed and eyewitnesses spoke of trucks carrying away loads of bodies.

Umar, 36, one of the victims who have served 12 months in jail for taking part in the violence, said: "My hope is just that the judges decide what is right."

Separate trials on the same case will see three other generals on the dock: retired major general Butar Butar who at the time was a colonel heading the North Jakarta military command, retired major general Pranowo who at the time headed the jakarta military police and the current chief of the Kopassus army special forces, Major General Sriyanto Mustrasan.

Sriyanto, then still a captain who headed the operation department of the North Jakarta military command, had ordered the defendants to stand guard at the North Jakarta district police where they later shot into the crowd.

The head of the judge's panel, Andi Samsan Nganro, has said that 33 witnesses have been summonsed to appear at the trial, which resumes on September 29 and under the law should be completed within 180 days.

The rights court was set up in 2001 to try soldiers and civilians accused of crimes against humanity during East Timor's bloody breakaway from Indonesia in 1999. It was also tasked with holding trials on the Tanjung Priok massacre.

The court has finished the trial of 18 suspects over East Timor but the hearings have been widely dismissed by rights groups as a sham. Eleven security force members and one civilian were acquitted.

Six people -- three army officers, a former Dili police chief, the former civilian governor and an ex-militia chief -- were sentenced to between three and 10 years in jail, but they all remain free pending appeals.

Focus on Jakarta

West Jakarta evictees refuse to leave, want compensation

Jakarta Post - September 20, 2003

Bambang Nurbianto and Zakki Hakim, Jakarta -- Most of the evicted people who had been living on disputed land at Kampung Baru, Cengkareng Timur, in West Jakarta, insisted that they would stay on the land and demand compensation for the destruction of their homes.

Marlo Sitompul, chairman of Youth Front for the Poor (LPRM) that advocates on behalf of the people, told The Jakarta Post on Friday that most families demanded the state-owned housing company Perum Perumnas to provide adequate compensation that would at least cover the value of their houses if they were not allowed to rebuild at the site.

Another solution is to provide the 300 families with new house from Perum Perumnas without a down payment but they can pay in installment. "The negotiation process with Perum Perumnas is still ongoing. So far we have yet to find a desirable solution," Marlo said.

The families were forcible thrown out after some 3,000 police and city public order officers bulldozed their houses on Wednesday causing a clash which resulted in 25 victims being hospitalized.

Councillor Abdul Azis Matnur from City Council Commission A overseeing legal and administrative affairs told the Post that the officials must not simply forget the newly homeless people. "It's true that the evicted people's legal standing with the land is weak but the administration must also be responsible for them after the eviction," he said.

Governor Sutiyoso had said earlier that the eviction would go on and the people he termed squatters had two choices: return to their home villages outside of Jakarta or join the transmigration program, a government program.

Earlier, National Commission on Human Rights (Komnas HAM) vice chairman Solahudin Wahid slammed the governor for his statement that the eviction was acceptable because there were no fatalities and the evicted people were not his responsibility because they did not hold Jakarta ID cards.

According to the head of Perum Perumnas, Didin Sutadi, the problem started in 1998 when the West Jakarta mayoralty allowed unemployed people to farm on the neglected 55-hectare plot of land belonging to the company.

These farmers, Didin said, eventually built houses and "sold" them to other people. However, the new buyers in Kampung Baru received what seemed to be a legal document stating that they owned the land, and based on that asked the mayoralty and the City Council to delay the eviction.

Residents bought the land from three heirs of the original owner of the land, M. Yasin, beginning in 1998. The residents received copies of the land titles, which were supposedly certified by the National Land Agency in 2002.

Evictees seeks help from right body

Jakarta Post - September 19, 2003

Jakarta -- Dozens of evicted local people who had been living on disputed land at Kampung Baru, Cengkareng Timur in West Jakarta, filed a complaint on Thursday with the National Commission on Human Rights (Komnas HAM) following their violent eviction on Wednesday.

They brought with them evidence of the violence including helmets of the public order officers, batons, sharp weapons and a blood- tainted riot shield.

Representatives of the families, whom the city views as squatters, also demanded that the rights commission hold an inquiry to summon the city administration, the police and officials of the state-owned housing company Perum Perumnas.

Komnas HAM vice chairman Solahudin Wahid said that the rights commission just met Perum Perumnas officials on Tuesday and he seemed to imply that there would be a delay in the eviction raid, pending further negotiation with the families who they said illegally occupied the state's property.

"We cannot allow violence," he said, adding that such acts showed the administration's arrogance and violates the residents' right to protection.

Solahudin also deplored the comment made earlier by Governor Sutiyoso who said that the eviction of the Kampung Baru "squatters" was nothing unusual because there were no fatalities and those who did not have Jakarta ID cards were not his residents. "A governor should not say such things, it's very arrogant," he said.

One of the victims, Johanes, 27, showed up at the Komnas HAM office with an injury to his head. He said that two others were still being treated at the Cengkareng Hospital after sustaining gun wounds and lacerations caused by sharp weapons.

During Wednesday's eviction, the clash involving the police and public order officers pitted against the residents resulted in at least 23 injuries to the defenders. Two officers were also reportedly hurt. The clash erupted as the administration began to bulldoze the houses down.

News & issues

Hundreds stages protest against Israel and America

Jakarta Post - September 20, 2003

Ainur R. Sophiaan and ID Nugroho, Surabaya -- Hundreds of students and religious activists staged separate rallies in the nation's second largest city of Surabaya as well as in Yogyakarta on Friday to protest the United States' stance regarding Palestinian leader Yasser Arafat.

Around 200 students from various universities in Surabaya, East Java, marched to the US consulate, while calling America the "real terrorist".

The protesters, comprising activists from the United Front of Indonesian Muslim Students (KAMMI), the Muhammadiyah Student Association (IMM) and the Surabaya Muslim Student Association (HIMMAS), began their march at Bungkul Park, some two kilometers away from the consulate.

They carried banners and posters with slogans expressing strong opposition to both Israel and the United States. "Destroy Zionist Israel and its lackeys," one banner read. "America is the world's colonialist and Israel is its golden child," another banner said. "Today Palestine, tomorrow Indonesia." The demonstrators condemned US President George W. Bush's administration for vetoing a United Nations resolution urging Israel to back down from its threat to expel Arafat from the region.

Protest leader Agus Dwiyatmo said the veto deteriorated the international image of the US and would convince people that the superpower was merely Israel's "errand boy". "All the world communities, particularly Muslim ones, know that the Bush administration is Israel's shepherd, but they hide behind the rhetoric of democracy and world peace," he added.

The protest was held before Friday's Muslim prayers and ended peacefully, even though some demonstrators hurled dirt clods and rocks at the US consulate before they dispersed. "This is for the US' crime," shouted one protester as he picked up a handful of gravel and heaved it in the general direction of the building.

In Yogyakarta, around 500 supporters and sympathizers affiliated with the Prosperous Justice Party (PK Sejahtera) staged a similar rally against the US and Israel. They headed en masse from the Yogyakarta legislative council on Jl. Malioboro to the Besar post office on Jl. Trikora, carrying banners and posters expressing disgust with the two countries, Antara reported.

"Israel's threat [against Arafat] is part of the trickery and injustice on earth," Agus Purnomo, chairman of Yogyakarta's PK Sejahtera chapter who led the protest, was quoted as saying.

The demonstrators also urged the World Bank and other financing agencies to freeze accounts of "terrorist states" like Israel, to stop the flow of money for its defense spending.

The Indonesian government should be at the forefront of the call, they added. The protesters then began calling on Indonesia and other countries to cut ties with the United States, accusing it of supporting state terrorism in the world. Indonesia should solicit more international support for Palestinian independence by starting a fund drive, they added.

Last Sunday, tens of thousands of PK Sejahtera supporters flooded the two main streets of Sudirman and Thamrin in Jakarta to show support for the Palestinians.

Faisal Basri and friends launch new political organisation

Kompas Cyber Media - September 18, 2003

Heru Margianto, Jakarta -- A number of political and economic figures launched a new political organisation at the Hotel Aryaduta, Jakarta, on Thursday September 18. The new organisation which is named the Preparation Committee for Movement Indonesia (Komite Persiapan Pergerakan Indonesia, KPPI) is headed by economist Faisal Basri. Other presidium members include Meilono Suwondo, Indira Damayanti, Bara Hasibuan, Bondan Gunawan, Budiman Sujatmiko, Deliar Noer and Esther Indahyani Yusuf.

In the text of the declaration which was read by Indira Damayanti, it said that the committee was formed as a response to young Indonesians to answer future challenges by providing an alternative political leadership. The organisation was established based on a platform of nationalism, populism, pluralism, progressiveness and democracy.

Meanwhile, Presidium chairperson Faisal Basri said that the new organisation represented a response to the actions of the political parties which are viewed as being incapable of providing progress to (for) the people.

"The Indonesian nation has many leaders and elites but they have never shown themselves to be genuine leaders of the people. It is time for the younger generation who were born in the movement against the New Order regime [of former President Suharto] to emerge in the political leadership in Indonesia".

Asked by journalists if the committee will become an embryo for the birth of a new political party, he said, "At the latest, we will hold the first congress of Movement Indonesian in one year. The congress will determine what this movement will become".

Up until this time, said Faisal, the KPPI leadership has been supported by local representatives from 18 provinces in Indonesia. The declaration was also attended by a number of figures such as Nurcholish Madjid (Cak Nur), Eros Djarot, Mudji Sutrisno, Sutradara Gintings, and Soeripto. (prim)

[Translated by James Balowski.]

Bali/tourism

Visas misused to fan separatism: Yusril

Jakarta Post - September 19, 2003

A'an Suryana, Jakarta -- Minister of Justice and Human Rights Yusril Ihza Mahendra said on Thursday the change in the visa policy was prompted by the gross misuse of the visitor's stay permit that undermined the country's territorial integrity.

He said the revocation of the visa-free facility for 48 countries was sorely necessary, as the government had discovered that a number of foreign non-governmental organization activists and researchers had fanned separatism in the troubled provinces of Aceh and Papua.

Yusril said such activities had gone on for many years. "The government must take preventive measures to ensure the sovereignty of Indonesia," he told reporters on the sidelines of a seminar at his office.

The Banda Aceh District Court sentenced in February British scholar Lesley McCullogh and American nurse Joey Sadler to five months in jail for visa violations. They were deported immediately after they had served their retroactive sentences.

Yusril acknowledged the new visa policy might discourage foreign tourists from visiting Indonesia, but stressed that the sovereignty of Indonesia was at stake. "The losses resulting from efforts to defuse the threats of separatism are far more costly than the losses [that would result] from a decline in tourist visits," he said.

The policy to revoke the visa-free facility for the 48 countries will be effective December 1, and the length of stay has been halved from 60 to 30 days. The citizens of 10 countries or territories are exempted from the new policy under the reciprocity principle, as these countries have granted visa-free entry to Indonesian nationals. The 10 countries are: Thailand, Malaysia, Singapore, Brunei Darussalam, the Philippines, Hong Kong, Macao, Chile, Morocco and Peru.

The country's bid to boost tourism was another reason to exempt certain countries from the new visa policy. The facility has been retained for countries whose citizens made up a significant percentage of tourists visiting Indonesia. The government is also considering granting 23 countries, including the United States, Japan and Australia, with a visa-on-arrival facility.

Conventional visa application procedures will apply to nationals from countries not included in the two categories. The new visa policy replaces Presidential Decree No. 15/1983, which granted a visa-free facility to nationals of 48 countries, with permission to stay 60 days.

Indonesia rethinks tourism, terrorism

Asia Times - September 19, 2003

Gary LaMoshi, Denpasar -- Muslim extremists have been convicted of the bombings that left 202 dead in Bali last October and which devastated Indonesia's tourism industry. Now, they're making another assault that's legal but potentially more damaging.

Justice and Human Rights Minister Yusril Izha Mahendra, who advocates turning Indonesia into an Islamic state, is spearheading a campaign that would further depress tourism by slashing eligibility for free visas upon arrival. At present, passport holders from 48 countries and territories can get a 60- day visa without a fee when they enter the country. Current visa eligibles include Indonesia's leading tourist sources -- Japan, Australia, the United States and European Union countries, plus up-and-coming Taiwan.

Under a Presidential Decree originally slated to take effect on March 31, passports from only 11 countries would entitle holders to free visas on arrival. That list includes Indonesia's comrades in the Association of Southeast Asian Nations (ASEAN) Thailand, Malaysia, Brunei, Singapore, the Philippines and Vietnam, plus Hong Kong, Macau, Chile, Peru and Morocco -- a list that represents a tiny fraction of Indonesia's current tourist arrivals.

Rules for the new policy haven't been issued yet, but Mahendra has declared a December 1 deadline for implementation. The latest reports -- which change more often than the weather forecast -- say nationals of 23 countries will be able to obtain 30-day visas upon arrival, with a 15-day extension available.

Entry fee Those visas would carry a price tag, though, variously reported as US$20, $30 and $50. The fees would be payable in cash at ports of entry, meaning these charges couldn't be hidden in airline tickets under the term "taxes and fees". Immigration officials at Bali's Ngurah Rai International Airport are busy constructing new booths for fee collection; Mercedes-Benz dealers (and smugglers) are likely drooling. Tourism-industry leaders criticize the new visa policy for hitting them when they're down. Bomb-blasted Bali, which still drives the $5 billion industry and relies on visitors for up to 80 percent of its jobs and incomes, is leading the charge with demonstrations, coalition-building with industry stakeholders in other regions and lobbying in Jakarta.

Industry figures show that international arrivals fell nearly 40 percent in the first eight months of this year compared with 2002. "We are in trouble," John M Daniels, head of Bali Discovery Tours, told an industry forum on Saturday. "We are in a depression." Daniels recalled trying to sell Bali to a convention group of 3,000 people and facing the visa issue: "How do I explain that extra $150,000 they need to budget?"

Or membolehkan makan kue

Mahendra's answer: hotels should give visitors free rooms, restaurants free meals, tour operators free trips. Now you know how to say "let them eat cake" in Bahasa Indonesia.

So what is the point of the new visa proposal? The official reasons of visa abuse by tourists -- isolated cases, which fees won't stop -- and reciprocity don't make sense. One rumor making the rounds is that during a visit to Australia last year, airport security screeners forced Mahendra to remove his shoes. As a result, he vowed revenge for this show of disrespect, or so the story goes. While the proposed changes would inconvenience and annoy some Australian and other tourists, the real victims would be Indonesians in the tourist industry.

More specifically, the victims would be predominantly based in Bali. The Bali bombings didn't just depress tourism, they further complicated its political distress, which hinges on tension between predominantly Hindu Bali and overwhelmingly Muslim Java and the rest of Indonesia. Initially, sympathy for Bali's tragedy was great, and it prompted a rush from leaders to distance themselves from Muslim radicals. Nearly a year later -- and just a year ahead of presidential elections -- some of that sympathy has given way to resentments old and new.

A policy that targets Westerners and hurts Bali could be an irresistible populist two-fer for Mahendra and his Crescent Star Party (PBB by its Indonesian acronym), which advocates turning Indonesia into an Islamic state. Western visitors (the diversions they bring and those that cater to them) plus Bali's 3.5 million Hindus represent obstacles standing between PBB and its goal.

Fringe festival

Events over the past two years, but especially during 2003, have increased Indonesian Muslims' sense of grievance and victimization. politicians as well as Islamic leaders continuously assert that the overwhelming majority of Indonesian Muslims are moderates, yet they are increasingly unwilling to denounce those few extremists spewing hate. They may have learned that from US primary election candidates who play to their parties' fringes, since they are the ones most likely to turn out and persuade like-minded people to go to the polls.

Politicians across the spectrum understand the strategy and now play both sides of the terrorism issue. Along with browbeating police for security lapses, a parliamentary hearing this week grilled National Police Chief Da'i Bachtiar over the arrests of 13 alleged terror plotters. The legislators' complaints echoed those publicized by the Indonesian Ulema Council (MUI) and Abu Bakar Ba'asyir's Indonesian Mudjahidin Council (parading the detainees' covered, cowering wives before cameras). MUI, recognized as a mainstream organization, previously denounced the four-year sentence against Ba'asyir handed down this month. An emerging revisionist myth is that recent terror attacks are the fault of Westerners, not the Indonesians doing the bombing.

In a further sign of the shifting political winds, several major tourism-industry groups based in Jakarta, including the Central Hotel and Restaurant Association and the Association of Indonesian Tours and Travel Agencies (ASITA), have refused to join hands with the Bali-led campaign against the new visa rules.

President Megawati Sukarnoputri, who enjoyed overwhelming support in Bali in 1999, has opted to skip next month's Bali bomb anniversary ceremony. Whispers are that she wants to snub Australian Prime Minister John Howard, who plans to attend the memorial service. The real thinking may be that there aren't many votes to be won from standing with Bali or Western terror victims and a great many Muslim votes that might be lost. By the way, it was Megawati who signed the Presidential Decree on the new visa rules, but no one expects her to explain her actions.

Whatever the intentions of Mahendra and Megawati, the new visa rules will hurt the whole Indonesian economy, not just Bali's Hindus. The delay in implementing the new rule suggests that someone high up understands that. If pandering to extremists sets the stage for yet another deadly terror strike, the impact will be even more devastating. There are few signs that any Indonesian leader understands that, and such figures are less likely to emerge as election days draws closer.

Islam/religion

Political hopes lie behind militant talk

Straits Times - September 19, 2003

Devi Asmarani, Jakarta -- First it was militant cleric Abu Bakar Bashir. Now, the head of the country's largest Islamic organisation is saying it too: There is no such thing as the Jemaah Islamiah.

"The verdict of Bashir is proof that JI does not exist," said Mr Hasyim Muzadi, the Nahdlatul Ulama (NU) chairman, a day after a court earlier this month acquitted Bashir of charges of leading the JI. The JI is just something made up by the Americans to corner the Muslims, Mr Hasyim said of the Al-Qaeda-linked group blamed for several bomb attacks and plots across South-east Asia.

His overnight transformation from a usually moderate voice of Indonesia's silent Muslim majority came under instant fire from Western diplomats, among them envoys from the United States and Australia. He hemmed and hawed and toned down his stance. But his actions were not surprising.

Nursing presidential ambitions while having to contend with a nasty internal rift that threatens to split the 40-million-strong NU, Mr Hasyim is going where many other religious leaders have boldly entered: the political stage. In fact, his predecessor, Abdurrahman Wahid, even managed a taste of the prized post of president.

The NU leader's transition has been amazing. Of late, he has been sounding more like a politician playing to the gallery than a hardline Muslim preacher.

Mr Hasyim has been tipped as a likely contender for the presidency or vice-presidency, at the least with backing from some major parties. For him, winning the support of Indonesia's moderate Muslims is not a problem, but winning over the hardline minority is. They see him as a "US lackey". He has been one of the most important non-governmental figures in Indonesia supporting the US-led global war against terrorism.

Established in 1926, the NU oversees the hundreds of Islamic boarding schools across the country that have produced several generations of NU thinkers, including Mr Abdurrahman and the latest crop of liberal Islamic scholars.

Its inclusive and moderate trademark has made Mr Hasyim a regular guest speaker on Indonesia's brand of Islam at various government and private functions in the US and other Western countries.

Mr Hasyim has spoken out against religious militancy. So his remarks last week could hurt not only his image in the eyes of the West but also the image of Indonesia as home to peace-loving, moderate Muslims. For now, he appears to have softened his new militant talk, but for how long is anybody's guess.

Economy & investment

Red carpet treatment for privileged customers

Jakarta Post - September 16, 2003

Andi M. Sadat, Jakarta -- Although the national economy has not fully recovered, some businesses are thriving. The country's major banks are one example.

As noted marketing management expert Rhenald Kasali said at a seminar held by Bank NISP: "You shouldn't mope around or be drowned in pessimism caused by the news in the media. That will only make your competitors happy, as they will actively make the best of the situation. They are the optimistic type who can always find unique solutions even in the worst situation."

This optimism was further confirmed by the result of a survey carried out by business magazine Warta Ekonomi two years ago, which indicated that the country had premium customers with funds totaling some Rp 450 trillion. "This fantastic amount of money, owned by about 600,000 people here, is close to one-third of the money in circulation in Indonesia," said Agoes Soebektie, director of consumer banking at Bank Negara Indonesia.

The existence of super-rich customers in Indonesia has apparently triggered a special kind of service-priority banking-that is provided not only by foreign banks operating here, but also by most major domestic banks, such as Bank Negara Indonesia (BNI), Bank Central Asia (BCA), Bank Niaga, Bank Mandiri, Bank Danamon and so forth.

These privileged customers-high net worth individuals (HNIs) in bankers' lingo-are provided with specially designed products and services that are also extremely customized and personalized. "It's like royal treatment for kings and queens," said Lynna Muliawan, head of consumer banking development at Bank Niaga.

Personal bankers are also on hand to give them personalized professional service in a luxurious private room, not only for routine banking needs but to assist them as investment and financial consultants.

Bank Mandiri also throws in safety deposit boxes at no extra charge. Next to special interest rates for savings and deposits, this bank also provides them with a special card-Kartu Bank Mandiri Prioritas-as an identity card that entitles its holder to pampered treatment, not only at Bank Mandiri branches, but also in the executive lounges at most major airports in Indonesia. They are also given priority by airport handling services and special facilities at numerous star-rated hotels and restaurants. Free invitations to seminars sponsored by Bank Mandiri are also offered them.

Meanwhile, PrimaGold Banking, launched by Bank Danamon in August 2002, also provides similar services. Its personalized relationship officers are available in the bank's offices in every major city in Indonesia. Along with professional financial planners, they assist their clients in how to invest their money based on up-to-date financial information.

PrimaGold customers automatically get gold or platinum credit cards with an enormous credit limit. Specially high interest rates for deposits in rupiah and dollars are also enjoyed by premium clients.

Bank Lippo offers its privileged customers VIP banking. A combined balance for both savings or deposits and current account is set at Rp 200 million as the minimum for a customer to be included as a VIP client of the bank. Such customers are then given one-stop banking services in special de-luxe rooms, banking and financial assistance that includes investment guidance from relationship officers and credit cards (Visa Gold and Master Gold), that provide a huge credit limit without annual fees. Their Visa Electron cards for cash withdrawals at automated teller machines also carry higher withdrawal limits than are extended to ordinary customers.

Bank Lippo VIP customers are covered by VIP Home Care, an insurance policy for protection of their homes at special rates, and huge insurance coverage.

Other insurance provided is VIP Motor Care, for their vehicles, and Hospital Refundable Insurance, which pays up to Rp 500,000 per day for hospital charges.

Although extremely lucrative, many bankers admit that apart from fierce competition, super-rich customers are highly demanding and fickle. Winning their hearts, therefore, is not an easy job.

In today's era of access, personalization and maintaining relationships are key factors, said Rhenald. The days are gone when transactions were considered as one-off occurrences. A "one-night-stand" attitude is definitely not helpful to maintaining loyalty and eventually making long-term profits for either party, the customer or the bank.

While taking care of a client's money, a bank manager or relationship officer must keep in mind all the time that it is the owner of the money: The human factor, in this case, is far more important. Just like the saying, "There's a child in each of us ...," Rhenald said merely giving customers delightful surprises, for example, gifts on their birthdays or the like, cements the relationship further. Often, even inexpensive items on the right occasion work better than raffles.

With such huge wealth each has tremendous bargaining power; matching the needs of each privileged customer in order to retain their business is an art in itself, concluded Rhenald.

Indonesia gives up privatizing another asset

Asia Times - September 16, 2003

Bill Guerin, Jakarta -- Defeated by an array of provincial legislatures, local interest groups and plant management, Indonesia's government appears to have thrown in the towel after a five-year battle to sell the country's largest cement group, government-controlled and publicly traded PT Semen Gresik, to Mexico's Cemex SA, the world's third biggest cement producer.

The failure shows how bullying, intimidation and the brute power of vested interests claiming to fight for a better deal for local people have been allowed to badly damage a valuable state asset that should be contributing to local development through employment, taxes and other obvious benefits. It also highlights yet again the even bigger problem facing the government in selling state-owned assets to foreign strategic investors.

The story began in 1995 when the government merged its three state-owned cement companies into one. Gresik in East Java bought regional cement manufacturers Semen Padang in West Sumatra and Semen Tonnasa in South Sulawesi. The idea was to prevent private cement producers from dominating the local market and to give economies of scale and synergy in marketing, procurement, information technology, accounting and management.

A new management team of the Semen Padang subsidiary, which had to be guarded by hundreds of police and soldiers when they virtually took over the management on September 8, last week promised faithfully to spin off the unit from the parent company and thus leave it in local hands. Though in April the government had hinted it might accede to such a move, the governor of Padang and the provincial legislature have won a resounding victory over Mexico, Jakarta and State Enterprises Minister Laksamana Sukardi.

In 1998 the government kicked off its privatization program by offering Gresik to qualified strategic investors. Cemex bought 14 percent of the company for US$114 million and secured a put- option agreement to allow it to become a majority shareholder. Under this option, the government had the right to sell, and Cemex was given the right to buy the remaining 51 percent. Semen Padang's shares are 99.99 percent owned by Gresik, which is still 51 percent owned by the government. Public shareholdings in Semen Gresik total 23.46 percent and the Mexicans, through their Cemex Asia Holdings Ltd, have 25.53 percent.

The rationale was that if the government needed money, then it could exercise the option. The deal would have earned the government $525 million, helped plug a gaping hole in the state budget, and acted as a catalyst to rekindle the interest of foreign investors.

By the end of 1998, Cemex had increased Gresik's exports to 1.8 million tonnes annually from 563,000 tonnes in 1997 and in 1999 bought another 11 percent of Gresik through the market to raise its stake to the current 25 percent plus.

But the privatization plan quickly ran into resistance from provincial legislatures, local interest groups and the managements of the group's plants in West Sumatra and South Sulawesi.

Semen Padang is the largest cement manufacturer in Sumatra, the second-largest cement market in the country after Java. There are abundant reserves of cement raw materials in the province and it operates near Padang's deepsea port, where any surplus production is easily shipped abroad.

Despite the impact of 1997-98 financial crisis, the company had been profitable and competitive and supplied more than 40 percent of the domestic cement market. But its previous management, abetted by vested interests in the local administration, and by local politicians, drove it almost into the ground and turned it in to the worst performer among Semen Gresik's three cement units. In 2000 the company recorded losses of Rp46 billion.

The problems started for real when the government then wanted to exercise the sell option quickly and for Cemex to honor it. In October 2001 leaders of the provincial legislature in Padang, the governor of West Sumatra and top executives of Semen Padang took matters into their own hands by passing a decree expropriating Semen Padang and putting it under the control of the general public. Commandeering the company, they claimed, was in the interests of the people of West Sumatra.

Semen Padang, they said, would be supervised by the provincial legislature until such time as it would be spun off from Gresik, and its status returned once again to that of a state-owned enterprise (SOE) in its own right.

Street demonstrations and labor strikes followed, staged by employees who opposed Semen Gresik's privatization and were fired up by a group of vested interests that wanted to maintain the company as their cash cow. Jakarta was to get the message, by hook or by crook -- hands off Semen Padang.

Despite the large-scale protests, most local community leaders still wanted the deal with Cemex to go ahead, as long as unresolved local issues were resolved. Semen Padang's land was "acquired" in 1998 in circumstances that created a dispute over the status of 412 hectares of traditional land. The issue was never resolved, either at the time of the original merger or when problems started to arise after the announcement in March 1998 that Semen Gresik would become the first state-owned company to be privatized.

In October 2001, a delegation of villagers from Lubuk Kilangan, where Semen Padang is based, visited the parliament in Jakarta to lobby delegates and demand a resolution of the land dispute, together with Rp5 in local community support for every kilogram of cement produced. Based on production levels and the rupiah exchange rate at the time, this would have cost the company about $2.5 million a year, a shade over 1.0 percent of its annual turnover.

However, amid the intimidation and threats coming from Padang, Jakarta broke up Gresik's three units two weeks before the three-year conditional sale-and-purchase agreement with Cemex expired in December 2001. Sukardi said the government would restore the status of Semen Padang to stand-alone state company by acquiring the majority of its shares from Gresik.

From that point on serious doubts were raised about the government's ability to honor its contracts with Cemex. Compromise had been expected but not capitulation. Semen Padang was a chance for the government to demonstrate and maintain its authority but instead of being resolute and pushing ahead with Gresik's privatization, Jakarta waffled and allowed the assets to be taken away without legal grounds.

Eventually an extraordinary shareholders meeting of the company in February 2002 voted to oust president Urip Timuryono and chief commissioner Setiadi Dirgo before their tenures ended. The shareholders held them responsible for the employee revolt which disrupted production in December 2001 and January 2002 and caused an estimated Rp100 billion ($9.5 million) loss from production disruptions and export cancellations. They were deemed to have sponsored, or at least given tacit support to the employees who demonstrated and went on strike and thus failed to defend shareholder interests.

Though improved security has been the vital and missing precursor to any sustained recovery in the economy Jakarta has now, quite simply, lost control of its own assets with State Enterprises Minister Sukardi's reported approval of the latest Padang spinoff program. Hardly surprisingly, the sister company Semen Tonneasa is now also demanding a spinoff.

The new president and chairman will face an uphill battle re- establishing any sort of working climate. They will need to work with one eye on the window for signs of any further protests if they are seen to be kicking their heels. There is no sign the threats and intimidation will let up.