Aceh

A journalist's brief experience as a GAM hostage

Jakarta Post - May 29, 2004

Nani Afrida -- The Jakarta Post's correspondent in Aceh, spent two nights two weeks ago at the Free Aceh Movement's (GAM) hideout in East Aceh regency, after she and five other journalists offered themselves as collateral for the release of about 100 GAM hostages, including RCTI television cameraman Fery Santoro. Recovering from the trauma that she endured during the rare experience, she recounted her story during her stay with GAM.

A starry night illuminated pitch-black Lhok Jok, Peudawa Rayeuk district, East Aceh regency. Electricity to the village had been cut by Free Aceh Movement (GAM) separatists to make them harder to detect by Indonesian Military (TNI) troops.

Lhok Jok is an isolated village inhabited by 100 or so people. It is hilly terrain, situated 64 kilometers from Langsa town and a GAM stronghold in the regency.

It was the first night (Saturday) that I was staying with GAM guerrilla fighters, along with five other journalists from print and TV media outlets, including two from RCTI.

We spent the night at a GAM hideout there to "hand over" ourselves to GAM so that RCTI cameraman Fery Santoro and about 100 other hostages could be released.

Fery was abducted 11 months ago. His colleague, Ersa Siregar, who was with him when they were taken, was killed in a gunfight with TNI troops at the end of last year. Every effort to free Fery failed, until, in early May, Peurelak GAM commander Teungku Ishak Daud decided to release the hostages, subject to conditions. One of these required that reporters stay overnight to convince Ishak that he would not be set up and ambushed. The TNI gave GAM 36 hours to free the hostages but declined to let reporters stay overnight, for safety reasons.

After intense negotiations, the TNI eventually agreed to six journalists staying overnight; I was one of them.

The air in Lhok Jok was getting chilly on Saturday. After magrib (prayers at dusk), we were invited to dinner by GAM men toting M-16 rifles. About 100 GAM personnel were there. Despite the TNI's promise not to attack, they were still vigilant. As guests, we were treated well.

Ishak chatted with us that night, mostly complaining about reporters who, during the period of martial law, he said, had filed biased reports.

To him, reporters were inclined to quote the TNI rather than report directly about the grief of Aceh people. He also explained that hundreds of civilians detained by GAM now were people who had requested protection from the cruelty, he said, of TNI. Only three people were listed as hostages, one of them Fery.

The night was almost over. We stayed in a surau (prayer house) adjacent to the Lhok Jok mosque.

Fery was released that afternoon (Sunday), in addition to about 100 other hostages. He was immediately taken to Langsa for medical treatment. He looked thin, weary and traumatized by the ordeal. We were saddened at seeing him.

As he left, we remained at Lhok Jok because the release of the 100 other hostages was put back until the next day. Ishak asked us to stay and the International Committee of the Red Cross (ICRC) promised to return the next day for a customary hostage- freeing ceremony.

The cessation of hostilities was over but the separatists requested, through the ICRC and their mediator, Alamsyah, more time because the hostages were held at different places and they needed time to collect them.

At 12 midnight on Sunday, the rebels received information that the TNI had objected to their request. The TNI had blockaded Lhok Jok with tanks and would strike at 6 a.m.

We tried to contact everyone, using GAM's satellite telephone to communicate, but to no avail. Head of the Alliance of Independent Journalists Edy Suprapto, when contacted by us, confirmed the deadlock.

"Never mind. The TNI are not concerned about your safety. It would be better if we took you all to the woods. After all, you have been captives since yesterday," said Ishak, smiling.

We were shocked and scared. We had seen the state that Fery was in. Who knows? We might have ended up like him.

To make it easier, Ishak divided us into three groups. We had no choice but to follow his instructions. Initially, I was put into the same group as Ishak, but he eventually decided to release me as I was the only woman in the group of reporters. We hugged each other before departing.

As it was already 3 p.m. on Monday and still there was no good news from Langsa, all rebels, including the five journalists, set off. They faded from sight as they passed behind the bushes. I was alone and, to be frank, scared. Residents who gathered at the Lhok Jok mosque also looked anxious. According to them, if subsequently a gunfight were to ensue and rebels were not found, civilians would become the target.

I couldn't recall how long I'd been daydreaming when suddenly a GAM rebel approached. I recognized him as Ishak Daud's aide-de- camp. "Kak [sister], it's OK! The TNI has given us until May 17 -- midnight tonight," he said. I couldn't believe it at first, but when I saw Ishak Daud and my colleagues with smiles on their faces, I realized that I wasn't dreaming.

Some 155 other hostages were freed by GAM. We could now go home after every hostage had been freed and was in a safe place. Only when we reached Langsa did we find out that it was our journalist colleagues in Langsa who had saved us, asking the TNI to extend the deadline for GAM to release the hostages.

Aceh governor faces corruption probe

Straits Times - May 29, 2004

Jakarta -- President Megawati Sukarnoputri has given police the go-ahead to investigate allegations of a multimillion-dollar graft case involving the governor of the war-torn province of Aceh.

A national police spokesman, Major-General Paiman, said yesterday that the police will investigate Governor Abdullah Puteh's alleged role in marking up the price of power generators bought for the local government.

The purchase caused a loss of 30 billion rupiah (S$5.6 million) to the state, said Maj-Gen Paiman. "As a state official, the police need presidential approval to question the governor. He will be questioned soon in Jakarta," he said.

The case involves an agreement to purchase generators and a loan from the provincially-owned Regional Development Bank. The anti- corruption commission is also investigating a separate 12 billion rupiah purchase of a Russian-made MI-2 helicopter, complete with VIP cabin, by the Aceh provincial administration about two years ago.

Commission deputy chairman Erry Rijana Hardjapamekas told AFP: "It's suspected the price should be six billion because the navy bought one at that price."

The police on Monday wrote to Mrs Megawati asking for her approval to question Mr Puteh, local newspapers reported. The corruption commission requires no presidential permission to question a governor. It has the power to file charges before a new court to be inaugurated in July.

Nine members of the Aceh provincial parliament have already been arrested for misusing the provincial budget and the former mayor of Banda Aceh has been detained in a separate scandal over funds meant for community economic projects.

Mr Puteh has denied any wrongdoing. President Megawati issued a decree last week severely curtailing his powers. Last week, she placed Mr Puteh in charge of the civil emergency status, which replaced a year of martial law, in the province.

The case has complicated the handover of control from the military to a civilian authority after the government downgraded martial law in Aceh on May 19.

The government imposed military rule in Aceh after it pulled out of internationally brokered peace talks and launched a large- scale offensive to control a separatist insurgency.

At least 2,000 people have been killed during the operations, the army says. Human rights groups say most of them were civilians. The Free Aceh Movement has been waging an independence battle since 1976.

Aceh is rich in oil and other resources. But local residents have long complained that unemployment and poverty are widespread while local officials seem only interested in their own welfare. Residents have expressed hope that the end of martial law would bring a new battle against corruption.

Villagers in GAM stronghold face no-man's-land

Jakarta Post - May 28, 2004

Nani Afrida, Banda Aceh -- "Free Aceh Sumatra!," shouted several guerrilla rebels of the Aceh Free Movement (GAM), during a ceremony for the release of 155 hostages, including RCTI cameraman Ferry Santoro, in a village in East Aceh regency recently.

Hundreds of rebels attended the ceremony, all carrying AK-47 and M-16 rifles along with their crescent-star red flags. It was the first time since martial law was imposed on May 19 last year in Aceh that GAM openly held such a ceremony among residents that was officially covered by the media.

Lhok Jok village in Peudawa Rayeuk district is located eight kilometers east of the Medan-Banda Aceh highway. It was not clear why GAM chose Lhok Jok village, but it has a hilly terrain, most likely considered a strategic place for GAM guerrilla fighters to hide out.

Lhok Jok itself is a poor, backward village. It has a small populace dominated by women. The men have mostly migrated to other towns or joined the guerrilla movement. The women work as farmers or as oil palm plantation workers. Their rice paddies only yield a harvest once a year.

There is no electricity even though electricity poles line the road. According to a local resident, GAM had cut electricity to the village for security reasons. The roads are not paved, they are dirt roads which turn to mud in the rainy season.

According to Lhok Jok residents, there are some 300 GAM fighters who pass back and forth in the village. They live in the hills on the fringe of the village. They only go down to the village when supplies run out to demand food from local villagers.

Life is not easy for villagers living in a GAM stronghold. They are not only viewed with suspicion by security forces, but are sometimes the target of TNI personnel' agitation if the latter fail to locate GAM guerrillas.

Zainal (not his real name), 25, a Lhok Jok resident showed bruises inflicted by TNI personnel when they entered the village to hunt down rebels a few days ago. "We are at a loss as to what to do. Whether we tell the truth or not, we're still treated as guilty," he told The Jakarta Post.

According to him, nearly all residents have been roughly treated by TNI personnel. They also frequently hit women and sexually harass them. "I was once slapped and my breasts fondled," said Ani, 17, a village girl.

TNI generals have admitted that some of their troops in Aceh had violated human fights, but they had been dealt with accordingly.

As the TNI personnel know that there are many GAM rebels in the village, TNI personnel are only brave enough to enter the village in the hundreds using tanks. Usually, after armed contact with GAM soldiers they would ransack residents houses and line them up in front of the mosque to be questioned in search of GAM members.

It used to be difficult for the TNI personnel to catch GAM members, because they often mingled with local residents. At the same time, local residents were afraid to reveal the identity of the GAM members to the TNI, fearing that their families would be abducted and killed by GAM members.

The years of fighting between GAM and the TNI, especially during the martial law administration, has brought misery to local residents. Many of their families or relatives have disappeared or been killed in the conflict.

A mother who lived in Lhok Jok admitted to having lost her child and husband during martial law in Aceh. "Up until now, we don't know where they have been buried," she said.

And, the hostage-freeing ceremony by GAM in Lhok Jok in fact made residents anxious. They have to think of excuses in case they are asked by TNI personnel why they had not reported the presence of GAM personnel in their village.

Megawati oks probe into Aceh corruption case

Associated Press - May 28, 2004

Jakarta -- President Megawati Sukarnoputri has given police the go-ahead to investigate allegations of a multimillion-dollar graft case involving the governor of the war-torn province of Aceh, a spokesman said Friday.

The police will investigate Governor Abdullah Puteh's alleged role in marking up the price of power generators purchased for the local government, said national police spokesman Maj. Gen.

Paiman.

The case caused a loss of 30 billion rupiah to the state, said Paiman, who like many Indonesians uses a single name. "As a state official, the police need presidential approval to question the governor. He will be questioned soon in Jakarta," he said.

Puteh has denied any wrongdoing. Megawati issued a decree last week severely curtailing his powers. The case has complicated the hand-over of control from the military to a civilian authority after the government downgraded a state of martial law in Aceh to a state of emergency on May 19.

A year ago, the government imposed military rule in Aceh after it pulled out of internationally brokered peace talks and launched a large-scale offensive to control a separatist insurgency.

At least 2,000 people have been killed during the operations, the army says. Human rights groups say most of them were civilians. The Free Aceh Movement has been waging an independence battle since 1976.

TNI promotes Aceh commander

Jakarta Post - May 28, 2004

Yuli Tri Suwarni, Bandung -- Aceh military operation commander Maj. Gen. George Toisuta will soon be promoted to head the first division of the Army's Strategic Reserves Command, the Indonesian Military (TNI) spokesman said.

"It is just a routine rotation," Maj. Gen. Sjafrie Sjamsoeddin told reporters after a briefing at the Army's Staff and Command School in this hilly West Java city. George is one of more than 80 TNI personnel who are being promoted or given new postings.

The government lifted the one-year martial law in the restive province on May 19 but said it would maintain the presence of troops there to fight Free Aceh Movement (GAM) rebels despite the province now being in a state of civilian emergency.

Sjafrie said the military operation commander position would be held simultaneously by Maj. Gen. Endang Suwarya, who is commander of the Iskandar Muda Military Command.

More than 2,000 people, including civilians, have been killed during the one-year military operation. Gunfights between TNI and GAM continue even after the lifting of martial law. It is unclear if the lifting of martial law is linked to the upcoming presidential election.

Along with the change of status, the government also announced that Aceh Governor Abdullah Puteh would be assisted by a team from Jakarta. Puteh has been named the administrator of the province during the state of civil emergency.

Jakarta's move is seen as a vote of no confidence in Puteh, who is being investigated for corruption. Police have reportedly asked for the President's permission to question the governor, while the Corruption Eradication Commission is planning to take over the graft case if the police fail to obtain permission to question the governor.

Puteh is reportedly involved in the alleged markup in the price of new power generators that caused Rp 30 billion (US$ 3.3 million) in state losses. The governor is also allegedly involved in the markup in the purchase of a Rp 12 billion Russian Mi-2 helicopter.

Civilian rule returns to Aceh

BBC News - May 24, 2004

Rachel Harvey, Banda Aceh -- After a year of military operations aimed at wiping out a rebel secessionist movement, the Indonesian province of Aceh is now back in the hands of civilians.

The status of the province has been downgraded from martial law to a state of civil emergency.

The man now in charge of Aceh is Governor Abdullah Puteh. In the plush surroundings of the governor's residence, Mr Puteh outlined the way the new arrangements will work. "It's like this. Whereas before I helped the military and police, now it's the other way around. They help me."

It does not sound like much of a difference. In fact the military campaign is set to continue. The security forces claim to have killed around 2,000 suspected rebels of the Free Aceh Movement, known by its Indonesian acronym GAM. Another 3,000 have either been arrested or surrendered, the military said.

The figures are impossible to verify, but what is certain is that none of the top rebel commanders have been captured.

The Indonesian officer leading the operation in Aceh Besar district, Lieutenant Colonel Joko Warsito, thinks it is just a matter of time. "We know the local GAM commander here is called Muharam. He's our main target now. If the local people continue to support us then it won't take too much longer," he said.

But it has already taken considerably more time than the military chiefs confidently predicted in May 2003, when martial law was declared.

The battle has been brutal. Over the past year, appalling human rights abuses have been committed by both sides. The security forces have been accused of torture, rape and unlawful killings.

GAM has resorted to taking civilian hostages and regularly extorts money from villagers.

Anti-governor protests

Large parts of Aceh are now more secure than they were a year ago. The main roads are busy with traffic, while schools and businesses in the major towns are operating again.

But there is little sign of an improvement in basic services or infrastructure, which the government in Jakarta promised would be provided alongside the military campaign.

"How can the government gain the trust of the people?" asked Achmad Humam Hamid, a sociologist at Syiah Kuala University in the provincial capital Banda Aceh. "Corruption is a big problem in Aceh today, and it goes from the highest level, the governor, right down to the lowest level of government employees."

Governor Puteh denied any wrong-doing, saying there was no evidence against him. "The principle of innocent until proven guilty should apply here," he said. "Anybody can make accusations, but according to the law, if there is no evidence against someone, why they should have to give up?"

But the voices of protest are growing louder. In Banda Aceh, students have led noisy demonstrations calling for Mr Puteh to be removed. Asnawi, a student at the Islamic Institute, said the people of Aceh were fighting two enemies -- GAM and corruption. "The change of status here doesn't really matter. The important thing is that the next leader should be clean. We can't accept a leader who is suspected of corruption," he said.

Asnawi's friend, Sim Hamid, said the government in Jakarta should start listening to ordinary people. "The central government only talks to the politicians. But they should go to the villages to see the real Aceh," he said.

The "real Aceh" is fantastically rich in natural resources -- fertile agricultural land, oil and natural gas. Yet Aceh remains one of the poorest provinces in Indonesia.

Little of the revenue has found its way back to Aceh's long- suffering civilians. That will have to change if the government in Jakarta is serious about wanting to win the support of the Acehnese people.

The problem is that the government of President Megawati Sukarnoputri, who faces a re-election contest in July, has never had a clear political strategy for the province. Indeed, some observers link the lifting of martial law to the election, though it is not clear how much Mrs Megawati will benefit.

But even if the government was able, eventually, to win the military battle against the separatists, what then?

Achmad Human Hamid thinks the first step should be to replace Governor Puteh with a new leader, respected by the people. "There is a window of opportunity," he said, "but I'm a little bit pessimistic. If the government in Jakarta goes ahead with this programme with no change at the highest levels of authority in Aceh, then it's a big gamble."

It is only a few days old, but already the suspicion is growing that the new state of civil emergency in Aceh may be nothing more than a cosmetic change.

Jakarta to diminish Puteh's power

Jakarta Post - May 27, 2004

Muninggar Sri Saraswati, Jakarta -- Despite earlier assurances that the governor of Nanggroe Aceh Darrussalam would remain in charge of the civil emergency administration, a presidential instruction to be issued on Thursday will effectively curtail his powers.

Interim coordinating minister of political and security affairs Hari Sabarno reiterated on Wednesday that Jakarta would directly supervise the integrated operation in Aceh, and that it had no plan to withdraw soldiers from the province.

Hari himself, who is also the home minister, will lead the government teams overseeing the "integrated operation", that encompasses the tasks of resuming security, law enforcement, improving the administration, humanitarian aid and economic recovery.

"The civil emergency in Aceh would be supervised directly by a body led by the president. The body would make policies to be implemented by the governor as the head of the civil emergency administration, assisted by the local police chief and the chief of the local prosecutor's office," he said after a meeting at the ministry.

He had said earlier that the governor would be "politically" in charge while being "assisted" by a team from Jakarta. In comparison, Governor Karel Albert Ralahalu was seen to hold authority over Maluku province when it was under civil emergency from mid 2000 to last October.

The different treatment for Aceh, where 12 months of martial law ended on May 19, is believed to be related to the corruption charges filed against Governor Abdullah Puteh. An investigation into corruption charges against the Governor is just about to begin although activists in Aceh have long offered their findings in connection with the corruption charges.

The Wednesday meeting was held to draft a presidential instruction, based on an earlier presidential decree on the civil emergency in Aceh, effective on May 20. Present at the meeting were National Police chief Gen. Da'i Bachtiar and National Intelligence Body chief AM Hendropriyono.

Hari said Jakarta would deploy two special teams to assist the implementation of civil emergency in Aceh. Each aspect of the "integrated operation" would be led by a Cabinet minister, all of whom would be accountable to the coordinating minister of political and security affairs.

The security operation is to be led by Indonesia Military (TNI) chief Gen. Endriartono Soetarto, and economic recovery is to be led by Coordinating Minister for Economic Affairs Dorodjatun Kuntjoro-Jakti.

"The teams are responsible for controlling the operations and the disbursement of funding for the operations," Hari asserted. Any decision made by the governor should have the approval of both the local police chief and the head of the local prosecutor's office as well as inputs from the government teams, Hari said.

According to Law No. 23/1959 on civil emergency, in an area under civil emergency the governor or regent is authorized to make decisions or regulations to maintain order in his territory.

He is given the authority to order the police or prosecutors to investigate, raid and seize property, to ban public gatherings, to impose a curfew, a media blackout and to order the tapping of telephone and radio communications.

Police, KPK probe corruption cases involving Puteh

Jakarta Post - May 26, 2004

Abdul Khalik and Muninggar Sri Saraswati, Jakarta -- The National Police and the Corruption Eradication Commission (KPK) separately announced on Tuesday they would investigate corruption cases in Nanggroe Aceh Darussalam (NAD) that allegedly involve Governor Abdullah Puteh.

As a start, the police will investigate the alleged markup in the price of new power generators, which reportedly caused Rp 30 billion (US$3.3 million) in state losses, while the KPK will probe into the alleged markup in the purchase of a Russian Mi-2 helicopter that cost Rp 12 billion.

National Police spokesman Insp. Gen. Paiman said the police wrote to President Megawati Soekarnoputri on Monday requesting permission to question Puteh as a witness.

"As a state official, Puteh's questioning needs presidential approval. We will use evidence collected by the Aceh Police and the former martial law administration in Aceh," said Paiman.

He added that the police would investigate other corruption cases allegedly involving the governor and other local government officials after they completed the first case and filed it with the prosecutor's office.

Previously, Aceh Police had said there were 42 corruption cases involving officials in the province that needed investigating.

Puteh has been named the administrator of civil emergency since the new status took effect on May 19, ending a year of martial law.

Earlier on Tuesday, Corruption Eradication Commission (KPK) chairman Taufiequrrahman Ruki said the commission would supervise the police in the investigation into the alleged corruption in the purchase of power generators.

"We will supervise them. They have sent a summons to Puteh to testify, but they must wait for approval from the President. [If they face difficulties in obtaining the approval] we will take over the case," Ruki announced on Tuesday.

According to the law on the KPK, the commission has the right to summon state officials without approval from the President and to press charges against them in court.

Ruki said the commission would be involved in the investigation into 11 corruption cases in the troubled province.

The commission will prioritize the alleged corruption in the purchase of the Russian Mi-2 helicopter by the Aceh administration. "We suspect there was a markup as we found the Navy bought a similar chopper for only Rp 6 billion," Ruki said.

The commission plans to question a number of Aceh government officials, including Puteh. Two other high-profile graft cases related to the purchase of used printing machines and the procurement of cars for the members of the provincial legislature are next to be probed by either the police or the KPK.

A report obtained by The Jakarta Post recently said that in 2003, the governor handed over Rp 75 million in loans to each of the 53 councillors to buy cars, but the lawmakers never paid back the money. A year before, the Aceh administration bought used printing machines worth Rp 4.2 billion, but they did not work.

Puteh has frequently denied reports of being involved in corruption, calling the reports a move to discredit him. He recently sought protection from lawmakers in Jakarta.

Martial law ends but troops remain

Green Left Weekly - May 27, 2004

Pip Hinman -- Jakarta's decision to lift martial law in Aceh, in favour of an "emergency status", won't change the lives of ordinary Acehnese for the better, according to a leader of the Acehnese community in Australia. Nurdin, who was once imprisoned and tortured by the Indonesian army, said that Jakarta's troops must be forced out of Aceh.

On the May 19 anniversary of the imposition of martial law in Aceh, Nurdin told Green Left Weekly that President Megawati Sukarnoputri's Indonesian government is sending up two more battalions to Aceh, which is on the northern tip of the island of Sumatra.

"Megawati's announcement [that martial law would be lifted at midnight on May 18] is really an admission of defeat. She said she would crush the Acehnese rebels in three months, but she hasn't done it in 12", Nurdin said.

"With the first round of the presidential elections due in July, she's keen to make it look like the war's over. In fact, it's not. She's spent some A$6.2 million fighting Free Aceh Movement (GAM) over the last year, sent more than 50,000 troops in and still the rebels have not been crushed, because Aceh's population of some 4 million want their freedom." The Indonesian military claims to have killed 2000 GAM rebels, arrested another 2100 and forced about 1300 to surrender over the past year -- more than the military's own estimate of GAM's strength. Human rights groups, including Amnesty International, Human Rights Watch and Tapol, report that many of those killed were civilians.

Martial law was imposed on May 19, 2003, following the collapse of talks between the Indonesian government and GAM. Rebel negotiators were arrested and Jakarta sent troops to crush the estimated 5000 rebels in the largest Indonesian military operation since the invasion and occupation of East Timor in 1975.

The government's shut-down of the province to reporters and human rights groups has kept this dirty war largely hidden from the world. But on May 12, Amnesty International reported that "nearly all aspects of the lives of ordinary citizens are adversely affected by the military emergency. People are terrorised by the numerous killings and the ever-present threat of arrest, torture and ill-treatment." The US-based Acheh Center reported on May 6 that Indonesia's armed forces top commander General Endriartono had admitted that soldiers had committed human rights violations against civilians, including rape and torture, and that more than 400 cases had been brought before military courts. Some prisoners, including Mohammad Nazar, a leader of the Aceh Referendum Information Centre (SIRA), have been moved to prisons in other parts of Indonesia.

Nurdin told GLW that the Acehnese people have little hope that a new president, due to be elected on July 5, will end the war in Aceh. He said that neither the Golkar candidate, former general Wiranto, nor Susilo Bambang Yudhoyono, another former general and leader of the Democrat party, were likely to withdraw the troops and start talks with GAM and Aceh's democratic organisations.

"[Wiranto and Yudhoyono] are reliant on the Indonesian military to back them and the military make a lot of money from corruption in Aceh", Nurdin explained. Not only that, the province is rich in gas and oil, and the government's new autonomy law still allows Jakarta to appropriate substantial revenue from the sale of Aceh's natural resources.

Activists call for release of women held in Aceh

Associated Press - May 26, 2004

An advocacy group pleaded Wednesday for the release of dozens of women it said were arrested by government forces and falsely accused of treason in the war-torn province of Aceh.

The non-government Information Center for a Referendum in Aceh, or SIRA, said 32 women have been charged with being part of "The Widows' Battalion" associated with the separatist Free Aceh Movement.

Their "guilt of even being involved in any political activity is very much doubt," SIRA said in a statement. "For the sake of humanity and justice, these women should be released. No proof whatsoever has been provided for this accusation. They are just victims of the military."

A spokesman for the military, Col. Ahmad Yani, said the women are members of the separatist group. "We take great care whenever we arrest someone," Yani said. "We have proof that they are involved in the secessionist movement."

A year ago, Indonesia launched an offensive against the rebels and imposed martial law that allowed security forces to arbitrarily arrest suspects.

Last week, the government downgraded the martial law in Aceh province to a state of emergency, but the new rules still allow the military to impose curfews, set up blockades and detain suspects indefinitely.

More than 2,000 people have died in the fighting since May 2003 and thousands more have been detained for alleged links to the separatist movement. Many of them, including juveniles, have been held for months without trial on charges of being rebel sympathizers. Human rights groups say most of the dead have been villagers caught up in army raids in remote villages. They also accuse the government of torturing detainees into confessing and holding brief show trials that result in multiyear prison sentences.

Rebels have been fighting since 1976 for an independent homeland in the oil- and gas-rich province on the northern tip of Sumatra.

SIRA advocates holding a referendum on possible independence for the region of four million people. Jakarta has refused this, fearing a repeat of the secession of East Timor, which broke away in 1999 after four-fifths of the electorate opted for independence in a UN-organized plebiscite.

Six killed in Aceh, Amnesty blasts army for rights abuses

Associated Press - May 27, 2004

Jakarta -- Six suspected separatist rebels were killed in Indonesia's Aceh province Thursday, as Amnesty International said the continuing military campaign there had caused "a marked deterioration" in the province's human rights situation.

The six were shot in separate incidents across the province, said army spokesman Lt. Col. Asep Sapari. No soldiers were injured in the fighting. The rebels' Free Aceh Movement couldn't be reached for comment.

It's impossible to independently verify military claims about Aceh -- journalists are barred from parts of the province on Sumatra island's northern tip. Last May, Indonesia's government abandoned an internationally sponsored peace process with the rebels, and the military launched a massive offensive in an effort to crush the 27-year-old rebellion.

More than 50,000 troops and paramilitary police have been deployed to confront Aceh's estimated 5,000 insurgents and sympathizers. At least 2,000 people have died in the fighting there in the past year. Rights groups have said most of them were innocent villagers caught up in the fighting.

In a statement received Wednesday, Amnesty International said that the conflict has displaced tens of thousands of people, and that both government troops and rebels are guilty of rights abuses.

The rights group's statement also expressed concern for the fate of the 2,000 people captured by security forces. "Detainees were denied access to lawyers," the statement said. "There were concerns that they were at risk of torture or ill-treatment, apparently routine in military and police custody."

West Papua

Turning migration inside out in Papua

Interact - Spring 2004

Neles Tebay -- When the territory of Papua was under Dutch rule, the population was almost exclusively Papuan, made up of some 252 ethnic groups. Since Indonesia took over the territory in 1963, however, the composition of the population has altered due to the influx of Indonesian migrants.

The main reason has been the government-sponsored programme of transmigrasi (transmigration). According to the regional office of the Deparatment of Transmigration in Papua (formerly known as Irian Jaya), from 1964 to 1999 nearly 250,000 households -- or over 500,000 people -- have been settled in Papua, living in more than 200 settlements or villages built by the government. Slowly but surely these transmigration sites have developed into towns with ballooning populations.

The majority of the transmigrated people originate from the island of Java and are Muslims. Although the government denies it, Papuans suspect the transmigration program to be a thinly veiled policy of "javanization" of the territory of Papua.

Other newcomers have been 'spontaneous migrants' who have settled in all major towns in Papua. Two-thirds of the population of major towns are not Indonesians who were not born in Papua.

The influx of migrants has already altered Papua's demography. In 1961, the population of 700,000 was predominantly Papuan. In 2001, of the 2.2 million people in Papua, there were approximately 800,000 migrants and 1.4 million indigenous Papuans. If this trend continues, within a few years the Papuans, who are a minority in Indonesia, will also be a minority in their own land.

Changing places

The influx of migrants has effectively marginalized indigenous Papuans. Migrants play dominants role in society, excelling in trade, services, construction and contracting in virtually all major towns. Jobs in government offices are taken by migrants and their descendents.

Government development activities has also been concentrated in towns, which are for more developed than rural areas. Consequently, migrants have disproportionately benefited from these government programmes, while the majority of the Papuans who live in isolated and remote villages are ignored.

Papuans see the migrants getting rich easily and quickly. People say: "They only come for the money," or "They only come to find and steal our natural resources, not to educate the Papuan people." The situation inevitably fosters envy and tension among local communities.

In 2001, the provincial government of Papua, worried about the impact of transmigration, introduced a programme if development for villages occupied by the Papuans in rural areas. In the same year, the central Indonesian government in Jakarta, in its law on special autonomy for Papua, agreed to limit the influx of spontaneous migrants to only those who are experts and have completed studies at high school or university level. However, to date the Indonesian government has failed to implement the law on special autonomy.

Breaking point

In the future, many more migrants will continue to go to Papua, to fill government jobs or work for private companies investing in the territory -- such as BP's gas project in Bintuni Bay in partnership with the state-owned Indonesian company Pertamina.

Qualified and skilled people are needed for these jobs -- and indigenous Papuans cannot fill all the jobs. Indonesian are free to move to and live in any part of Indonesian territory. People will go where the jobs and the opportunities are, and consequently many more internal migrants will go and settle in Papua. The influx of migrants is inevitable but it is also, inevitably, altering Papua's demography. Indigenous Papuans are already marginalized socially, culturally, and economically. Many of them feel it is no exaggeration to say that sooner or later, if these trends continue, ethnic Papuans will ultimately vanish from the surface on the earth.

Papuans are therefore calling on the international community to put pressure on the Indonesian government to implement its own law on autonomy for Papua. The Indonesian government must also be urged to engage in peaceful and constructive dialogue with Papuans to identify the root causes of the problems and to determine peaceful solutions -- before it is too late.

[Interact is published by the Catholic Institute for International Relations.]

East Timor

Wiranto hopes to meet Gusmao over 1999 atrocities

Agence France Presse - May 26, 2004

Jakarta -- Indonesian presidential candidate Wiranto, who has been charged with condoning atrocities in East Timor in 1999, hopes to meet East Timor's President Xanana Gusmao this weekend to discuss the abuses, a Wiranto aide said Wednesday.

"We are trying to set the meeting for the 29th in Bali and so far both sides have agreed," said Muladi, a member of Wiranto's campaign team.

However he said Gusmao had not yet officially confirmed the meeting which would be "informal and held in a family-like atmosphere."

In Dili, Gusmao's chief of staff Agio Pereira declined comment on whether the president would attend such a meeting. "The president receives a lot of requests for meetings but his schedule is also very tight," Pereira said.

Muladi told AFP that any meeting "will discuss the future and try to leave our problems in the past." He said the two men would discuss rights violations before and after East Timorese voted in August 1999 to break away from Indonesia.

UN-funded prosecutors in Dili have charged Wiranto, a former armed forces chief, with crimes against humanity.

A judge on May 10 issued an arrest warrant for Wiranto. But East Timor's top prosecutor Longuinhos Monteiro said Tuesday it would not be in his country's interests to forward the warrant to Interpol.

His comments followed a meeting with Gusmao, who says good relations with Indonesia should take priority over the United Nations-backed efforts to seek justice.

Wiranto is the candidate for Indonesia's largest party Golkar in the July 5 presidential election. He says he did his best to prevent the violence.

Government & politics

Mega bemoans her shrinking Cabinet and effect on government

Straits Times - May 29, 2004

Jakarta -- President Megawati Sukarnoputri has complained about Cabinet ministers who quit to challenge her in the coming presidential election.

Their departure weakened her government, she said on Thursday at a General Elections Commission (KPU) meeting.

She called for a way to prevent the political interests of ministers from affecting the administration of the country.

"If a minister joins the presidential race, then what we experience today will recur," she said. "The ministers just leave the Cabinet without finishing their duties," she was quoted as saying by KPU deputy chairman Ramlan Surbakti.

The President asked the commission for input to help the next government cope with such a situation in the future. "I raise this issue not because I am the incumbent president but such a matter should not happen again," she said.

In the July 5 election, the President will face three of her former ministers and her deputy, Mr Hamzah Haz. Former coordinating minister for political and security affairs Susilo Bambang Yudhoyono is the presidential candidate from the Democratic Party. His running mate is former coordinating minister for people's welfare, Mr Jusuf Kalla. Former communications minister Agum Gumelar is the vice-presidential candidate of the United Development Party (PPP), which has nominated its leader, Mr Hamzah, as its presidential candidate.

Earlier this month, Ms Megawati branded ministers contesting the presidential election as "leaping squirrels" for abandoning Cabinet and state duties to pursue their own political interests.

But she was soon criticised by observers who said that with or without resignations, her Cabinet had never worked effectively. "Mega should realise that her government does work well in many fields. So when some ministers resign, she should not use their departure as an excuse for her administration"s performance,' political analyst Arbi Sanit said.

The current Cabinet was unable to resolve key problems, particularly corruption, law enforcement and unemployment, he said. "Moreover it is a minister's right to resign from the Cabinet."

Another observer, Mr Saiful Mujani, said the resignations were a consequence of Ms Megawati's rainbow Cabinet which had not built strong ties with her Indonesian Democratic Party of Struggle. And he warned her against complaining too loudly about the resignations as it could backfire on her own campaign.

2004 elections

Profile: Susilo Bambang Yudhoyono

British Broadcasting Corporation - May 28, 2004

Rachel Harvey, Jakarta -- As Indonesians prepare for their first direct presidential election on 5 July, the latest opinion polls suggest a retired general is the frontrunner.

Susilo Bambang Yudhoyono, also known by his initials SBY, is drawing support from his image as a man of integrity, a strong communicator and firm leader in times of crisis.

Mr Yudhoyono is probably best known internationally for his leading role in Indonesia's fight against terrorism in the wake of the Bali bombing in 2002.

His speech on the anniversary of the attack was seen as one of the strongest delivered by any Indonesian leader on an issue which is still politically sensitive.

But critics say the former military commander is surprisingly indecisive, tending to consider all perspectives and opinions before making up his own mind.

Budi Santoso, chairman of Mr Yudhoyono's Democrat party, agrees he is a thoughtful man, but says he is capable of making decisive moves when necessary. "For example, while other presidential candidates where still looking about for suitable running mates, Susilo had already chosen Jusuf Kalla as his vice president," Mr Santoso said.

The man dubbed "The thinking general" was born in 1949 in East Java. The son of a retired army lieutenant, Susilo Bambang Yudhoyono graduated from Indonesia's military academy in 1973.

Two years later Indonesian security forces invaded East Timor. As he rose through the ranks, Mr Yudhoyono completed several tours of duty in the territory. By the time of East Timor's violent transition to independence in 1999, he had been promoted to Chief of Territorial Affairs. As such he would have reported directly to General Wiranto, the former head of the armed forces who has now been indicted for war crimes by a special tribunal in East Timor.

But there has never been any attempt to bring charges against Mr Yudhoyono. His supporters say he was not part of the inner circle of military commanders accused of allowing the violence to spread. That distinction is particularly important given that General Wiranto is now one of Mr Yudhoyono's main rivals for the presidency.

Honorary award

In fact, Susilo Bambang Yudhoyono never quite achieved the highest levels in the military to which he aspired. His four star General status was an honorary award given to him when he left the army to join the government of Abdurrahman Wahid in 2000. He started as minister for mines but was soon promoted to chief minister for security and political affairs.

A year later he found himself in conflict with his boss. Facing impeachment, President Wahid asked Mr Yudhoyono to declare a state of emergency. Mr Yudhoyono declined, and promptly lost his job. In March 2004, history repeated itself. Mr Yudhoyono, reappointed as senior political and security minister under President Megawati, stepped down after a very public spat with the president and her husband. The decision to resign, according to Denny Ja, executive director of the Indonesian Survey Institute, has paid off handsomely.

"Even though SBY was a senior member of a deeply unpopular government, he has come to be seen as a victim of that government rather than part of it," said Mr Ja. Being forced from office under successive presidents seems to have enhanced Mr Yudhoyono's reputation as a man of principle, willing to sacrifice his own ambitions for the values he believes in.

That -- and the fact he looks good on TV -- makes him a potential election winner, according to Denny Ja. "You have to remember that 60% of the population only graduated from elementary school, so they don't investigate candidates too closely," Mr Ja said. "When we ask people who is most competent to run the economy and security, people put SBY first. Whatever the truth, that's the perception and perception matters."

Mr Yudhoyono says he has travelled the length and breadth of Indonesia, talking to ordinary people. "I understand what they feel; I know their expectations" he recently told a crowded room full of supporters.

The question is whether he has the qualities to meet those expectations. His image so far seems to rest as much on what he has not been involved in as it does on what he has actually achieved. That will change if he is elected president. Then the real Susilo Bambang Yudhoyono will have to stand up.

Presidential favourite a hit in Java heartland

Reuters - May 30, 2004

Dean Yates, Garut -- The dramatic rise of Indonesian presidential frontrunner Susilo Bambang Yudhoyono is all the more surprising when you look at his campaign headquarters in the West Java town of Garut.

A volunteer labours over an old typewriter in a tiny office. No funds have been sent to prepare for the presidential election campaign, which opens on Tuesday. For April's parliamentary poll, volunteers made do with 500,000 rupiah ($54) and 50 T-shirts emblazoned with Yudhoyono's picture.

In other towns in West Java, Indonesia's most populous province, offices of Yudhoyono's Democrat Party were not even open when a Reuters correspondent dropped by late last week.

But despite minimal funds and an infant political party, the retired general and former chief security minister has won converts across the emerald rice fields and towering volcanoes of Java island, Indonesia's political and economic heartland.

Home to more than half Indonesia's voters, Java was once a bedrock of support for incumbent President Megawati Sukarnoputri. Not any more.

From dozens of conversations during a trip through West Java it's clear many Indonesians have pinned their hopes for the July 5 election on a man some see as saintly by the nation's political standards -- honest, scandal-free, calm, a former general with no blood on his hands, and a good Muslim.

"This election is a chance to stop our country from falling apart," said 19-year-old student Revi Purwanti Rusliyani, passing the time with her friends in Garut, a town of 120,000 people surrounded by mountains and mist. "We need someone who has the education and leadership qualities like SBY," she added, using Yudhoyono's nickname.

Opinion polls show Yudhoyono winning 40 percent of Indonesia's first direct presidential poll, way above his main rivals Megawati or former military chief Wiranto, nominee of Golkar, once the party of former autocrat Suharto. The two other candidates in the race also lag well behind Yudhoyono.

Remarkably, few Indonesians interviewed in West Java's rice fields, towns and fishing villages had a bad word to say about Yudhoyono, even if they would vote for someone else.

That, researchers say, means he could pick up their votes if the election goes to a runoff in September and their first choice does not survive the July ballot. A runoff between the top two is required if no candidate wins a majority in July.

Troubled country

Since Suharto stepped down in 1998 after 32 years of military- backed leadership, civilian rule over the world's most populous Muslim nation has been weak and ineffective.

The economy is not growing fast enough to absorb five million job entrants each year. Indonesia's notorious graft and unpredictable courts have eaten into investment.

Yudhoyono has pledged to clean up corruption and win back the foreign investment Indonesia needs. He served as Megawati's top security minister until he quit last March.

Foreign governments like Yudhoyono because he speaks their language in fighting terrorism, although diplomats and some analysts say he can be chronically indecisive at times.

"For those who like SBY here, he is seen as a good worker and clean," said Harun al Rasyid, chief of Sukaraja village.

With their vast machinery, Golkar and Megawati's party should be jostling for the presidency. They came first and second in the April parliamentary election, winning 23 percent and 20 percent of the seats, respectively. Yudhoyono's party won 10 percent of the seats. But the big two are finding that what counts now is a winning candidate.

For a dozen motorcycle taxi drivers, farmers and jobless youths waiting out heavy rain under a rickety bus shelter in the village of Hayawang, the big issues are jobs and security. Almost to a man they dismiss Megawati. They like Wiranto but say he is too close to Suharto. In a straw poll, Yudhoyono wins the popularity contest because of his clean image.

That sort of support is consistent across the country. "The popularity of SBY has reached down to the villages. It is spread evenly across all provinces," said Muhammad Qodari, research director of the Indonesia Survey Institute.

Other things might work in Yudhoyono's favour. Sony Mulyadi Supriadi, a reporter with the local newspaper Priangan in Tasikmalaya, said Megawati could count on the backing of her most fanatical supporters around the town. But he had noticed more pragmatism among Golkar supporters. "Many who chose Golkar [last April] will go for SBY. They just think he is better," Supriadi said.

Ex-generals run for president but RI won't be regimented

Agence France Presse - May 30, 2004

Indonesia's presidential race gets under way this week, with two ex-generals among the front-runners to lead a nation which was ruled for most of its history by authoritarian figures.

Former military chief Wiranto and ex-security minister Susilo Bambang Yudhoyono are among five candidates who start campaigning Tuesday across the world's largest archipelago for the July 5 election.

Some 150 million voters, taking a giant step towards democracy six years after the fall of dictator Suharto, will for the first time directly elect their leader.

No one is expected to secure the more than 50 percent needed to win on the first round. Analysts say Wiranto, Yudhoyono or incumbent Megawati Sukarnoputri are likeliest to make it through to the run-off on September 20 between the top two.

While Indonesian voters are comfortable with military figures, analysts say the emergence of two former generals -- one of whom faces serious human rights charges -- is not a threat to the fledgling democracy.

"As long as they join the concept and follow the rules in a democratic context it is not a threat to democracy," said Dewi Fortuna Anwar.

"What many people worry about is the fact that in our transition to democracy, military thinking is still dominant, still part of the political discourse and civilians themselves have a feeling of insecurity," said Anwar, a former adviser to president B.J. Habibie.

Mohammad Qodari, research director of the Indonesian Survey Institute, said not all civilian candidates are better than military ones. He said some of Megawati's policies tend towards authoritarianism. She is a daughter of founding president Sukarno, who introduced the concept of "guided democracy."

Hadar Gumay of the Center for Electoral Reform said many Indonesians still hold the idea that military men are superior to civilians. "It's a reflection of our society's thinking." Another former general, Agum Gumelar, has joined the race for the vice- presidency as the running mate of vice-president Hamzah Haz. Haz is considered an underdog, as is national assembly speaker Amien Rais.

Under Suharto, the all-powerful military held civilian administrative positions nationwide.

Indonesians, grappling with economic problems and terrorist attacks, now long for the stability and prosperity associated with Suharto's rule. However Anwar said people want a strong leader but not an authoritarian one, making Yudhoyono more popular than Wiranto. Yudhoyono is way ahead in recent opinion polls.

"Wiranto was the highest military figure while Susilo never reached the highest level. Susilo did not exercise too much power in the past and has always been regarded as an intellectual," Anwar said.

United Nations-funded prosecutors in Dili have charged Wiranto with crimes against humanity. They say that as armed forces chief in 1999 he failed to curb atrocities by Jakarta's forces and their militia proxies against independence supporters.

A judge in East Timor has issued an arrest warrant, which Jakarta has ignored.

Wiranto is the candidate for the Golkar party, which had backed Suharto and which won the April 5 parliamentary election.

Golkar has the support of the National Awakening Party (PKB), which came third. If people vote for party rather than personality this would give Wiranto a big advantage.

But analysts said voters -- many of whom turned to new parties including Yudhoyono's Democrats in April -- would be divided between those who toe the party line and those who vote for individuals they like.

While PKB is affiliated to Indonesia's largest Muslim group Nahdlatul Ulama (NU), the NU leader Hasyim Muzadi is Megawati's running mate.

"If you have just a simple mathematical equation the winner will be the Golkar candidate, but again we are talking about a direct presidential election," Anwar said.

"Many younger people in PKB are not comfortable with this marriage of convenience [with Golkar]. Hardcore loyalists will support PKB-Golkar but those who are not hardcore maybe will just vote for Muzadi," she said.

"NU has a huge following but it is split." Arbi Sanit, a political lecturer at the University of Indonesia, agreed. "Who says that PKB is supported by all NU members?"

Panwaslu rejects Gus Dur's complaint

Jakarta Post - May 29, 2004

Jakarta -- For the second time in a week, former president Abdurrahman "Gus Dur" Wahid has hit a snag in efforts to revive his chances of returning to power.

The General Elections Supervisory Committee (Panwaslu) rejected on Friday a demand to include his name in the roster of eligible candidates.

Last Saturday, the General Elections Commission (KPU) disqualified him from the presidential race citing health reasons.

The committee said that Panwaslu could not heed the demand of the visually impaired Muslim cleric as it was beyond the committee's authority to take that decision.

"The authority to include the eligible candidates rests with the KPU. Panwaslu has no such mandate," committee member Masyhudi said, quoting Law No. 23/2003 on presidential election.

The committee then referred Gus Dur to the administrative court to file a suit. "The KPU ruling on the eligibility of presidential and vice presidential candidates was drawn up by state officials, it (the case) could, therefore, be a taken up by the administrative court," he said.

The meeting was presided by committee deputy chairman Saut Sirait, as chairman Komaruddin Hidayat had left the Panwaslu office after waiting for Gus Dur's arrival for almost two hours.

The committee, however, said that another KPU ruling which required a mandatory medical examination for presidential and vice presidential candidates was not drafted in line with Law No. 23/1992 on health.

Lawyers of Gus Dur have filed complaints with the committee against KPU Ruling No. 36/2004 on the eligibility of presidential and vice presidential candidates, which resulted in the disqualification of the revered cleric.

The commission has declared eligible Democratic Party nominees Susilo Bambang Yudhoyono and Yusuf Kalla, Golkar Party nominees Gen. (ret) Wiranto and Solahuddin Wahid, National Mandate Party nominees Amien Rais and Siswono Yudohusodo, Indonesian Democratic Party of Struggle nominees Megawati Soekarnoputri and Hasyim Muzadi, and United Development Party nominees Hamzah Haz and Agum Gumelar for the direct presidential election.

To resolve the dispute, the committee summoned the KPU for a tripartite meeting. The KPU declined to attend any meetings to resolve the dispute, and was adamant in saying that it had no dispute with Gus Dur.

Differences over ways to handle the dispute have aggravated conflict between the KPU and Panwaslu.

Despite the committee's rejection, Gus Dur said after the meeting that he was grateful for what Panwaslu had done. "This is a historic decision and I am happy for it. This decision has a positive tone and Panwaslu should be applauded," Gus Dur told reporters.

Bowing to the committee's recommendation, Gus Dur said that his defense team would soon file a suit with the administrative court.

Earlier this week, Gus Dur's defense team filed a civil lawsuit against three institutions he deemed responsible for thwarting his presidential bid.

Gus Dur sued the KPU, the Ministry of Health and the Indonesian Doctors' Association (IDI) for declaring him unfit to run for public office, seeking a whopping Rp 1 trillion (US$110 million) in nonmaterial damages.

The defense team will also seek a judicial review with the Supreme Court on the ruling.

Golkar, PKB sign coalition accord

Jakarta Post - May 29, 2004

Moch. N. Kurniawan and Tiarma Siboro, Jakarta -- The Golkar Party and the National Awakening Party (PKB) signed a coalition agreement on Friday, but doubts remain if the alliance would boost their candidates' chance of winning the July 5 presidential election.

The accord was signed by the chairmen of the two parties -- Akbar Tandjung of the Golkar Party and Alwi Shihab of PKB.

"This coalition will unite visions, missions, and programs in the executive and the legislative branches and state institutions at the national level," said the declaration, read out by actress Nurul Arifin, who ran as a Golkar candidate in the April 5 legislative election, but did not gain a seat.

"We will unite actions to help Golkar's presidential and vice presidential pairing Wiranto and Solahuddin Wahid, who are fully supported by PKB, win the presidential election," the declaration said.

The PKB decided to forge an alliance with Golkar after the General Elections Commission (KPU) disqualified Abdurrahman "Gus Dur" Wahid from the country's first direct presidential election on July 5.

Golkar, which won 24 million votes in the April 5 legislative election, has named rights campaigner Solahuddin Wahid as the vice presidential candidate of Wiranto, who had been accused of gross human rights violations in East Timor in 1999. PKB garnered 12 million votes in the same election.

Akbar said he was happy with the written agreement supporting the Wiranto-Solahuddin pairing and that Gus Dur had also given his written support.

Alwi, meanwhile, expressed the hope that the coalition would result in long-lasting and solid cooperation.

However, just as Akbar and Alwi signed the accord, the provincial chairman of PKB in Medan, North Sumatra said that the coalition was not in line with the agreement reached in a national working meeting. Antara reported from Mataram, West Nusa Tenggara (NTB) on Friday that all regional and branch leaders of Nahdlatul Ulama (NU) and leaders of 60 Islamic boarding schools (pesantren) in the province had agreed to support the pairing of Megawati Soekarnoputri and Hasyim Muzadi in the upcoming election.

Provincial NU chairman Syaiful Muslim said the agreement was made during a meeting that ended on Thursday evening.

"The agreement to support the Megawati-Hasyim pairing is the individual decision of each NU leader, but the leaders of the 60 pesantren represent their institutions," Syaiful said.

On Wednesday, 120 NU ulemas from Java and Sumatra also pledged their support for Megawati and Hasyim.

Reports said earlier that virtually all NU leaders in East Java, the stronghold of the country's largest Muslim country, had also thrown their support behind the pair.

Almost 80 percent of the 12 million votes that PKB, which was set up by NU leaders ahead of the 1999 general election, garnered in the legislative election came from East Java.

Meanwhile, young PKB politician Bara Hasibuan tendered his resignation on Friday due to disappointment over the party's decision to support Wiranto.

"I consider the current election a critical time for this country to nominate credible leadership, otherwise we will never move forward.

"I do understand that the PKB has been in a difficult situation after the KPU disqualified its main candidate, but I don't think it should have to support Golkar's candidates," Bara told The Jakarta Post He also said that many PKB members were of the same opinion, but did not divulge any names.

PKB had earlier nominated Gus Dur and Marwah Daud Ibrahim as their candidates, but KPU disqualified Gus Dur due to his poor eyesight. The party has not appointed a replacement, while Gus Dur had vowed to stay out of the system.

"I wish that the PKB would support any other figure but Wiranto... his past is such heavy baggage for the country," said Bara, referring to allegations of rights abuses against the retired four-star Army general.

Parties not transparent about poll funding: NGO

Jakarta Post - May 29, 2004

Tiarma Siboro, Jakarta -- Many political parties have not submitted the appropriate reports on campaign expenditures for the April 5 legislative election to the General Elections Commission (KPU), a civil governance non-governmental organization disclosed on Friday.

Transparency International Indonesia (TII) secretary-general Emmy Hafild has therefore urged people not to vote for those parties' candidates in the July 5 presidential election.

"Their lack of credibility means they will merely consider the interests of those certain people who assisted them," she said.

The TII report says most parties -- including the Indonesian Democratic Party of Struggle (PDI-P), the Democratic Party, the National Mandate Party (PAN) and the Prosperous Justice Party (PKS) -- did not provide a transparent report on their campaign funds, and that their actual expenditures far exceeded their reported spending.

"For instance, the PDI-P reported on its balance sheet that it had about Rp 103 billion (US$117 million) in its treasury, while it spent no less than Rp 241 billion during the campaign. The Democratic Party claimed Rp 5 billion on its balance sheet, despite expenses of about Rp 30 billion for its campaign.

"Meanwhile, PAN and the PKS reported Rp 15 billion and Rp 125 billion respectively, but we estimate the parties spent tens of billions of rupiah during their campaigns," Emmy said. She added that several other parties, including the New Indonesia Alliance Party (PPIB), the Freedom Bull National Party (PNBK), the National Awakening Party (PKB), the Pioneer Party and the Golkar Party, had failed either to submit reports on their opening and closing balances or to disclose their financial sources for the campaigns.

The TII released the report after a four-month study from December 2003 to April 2004 in 20 areas across the nation.

"We also found that many legislative candidates dug deep into their own pockets to pay their expenses, even though the law stipulates that an individual's personal campaign funds should not exceed Rp 100 million," Emmy said.

She urged the KPU to request clarification from the parties, arguing that rampant money politics and the absence of transparency among parties had marred the legitimacy of the election.

The report also disclosed that several parties had intentionally omitted the identities of their campaign donors in disregard of the law, which stipulates that each party must disclose the identities of individuals who contribute funds exceeding Rp 5 million.

The parties are: the Indonesian Justice and Unity Party (PKPI), PAN, the PDI-P, Golkar and the Indonesian Unity Party (PSI).

Students protest against Hasyim

Jakarta Post - May 29, 2004

Bogor -- Vice presidential candidate Hasyim Muzadi was met by a rally during a visit to the Bogor Institute of Agriculture campus, where he was scheduled to talk.

The students said Hasyim and his running mate, Megawati Soekarnoputri, should not contest the election as they had failed to carry out the reform agenda. They said the pair would only make the situation in the country worse. Despite the protest, the talk on agriculture policy went ahead.

Civil servants flout rules to join campaign teams

Jakarta Post - May 28, 2004

Hasrul, Kendari -- The Southeast Sulawesi General Elections Commission (KPUD) has rejected several campaign teams proposed to back presidential candidates as they include civil servants, such as the deputy mayor of Kendari and other senior officials. "Only three teams submitted lists of their members. We returned them because the proposed names were not in accordance with existing conditions," KPUD chairman Kaimuddin Haris said on Thursday.

The campaign teams in question would support candidates Megawati Soekarnoputri and Hasyim Muzadi, Wiranto and Solahuddin Wahid, and Susilo Bambang Yudhoyono and Jusuf Kalla.

Under Decree No. 35/2004 issued by the General Elections Commission (KPU) and Circular No. SE/04/M.PAN/03/2004, by the administrative reforms minister, civil servants are banned from involvement in presidential campaigning.

"So, the ban on the involvement of civil servants, including police and military officers, has clearly been regulated. But, almost all the presidential campaign teams defiantly included their names," Kaimuddin said in Kendari, Southeast Sulawesi.

The campaign team for the Wiranto-Solahuddin pair included deputy mayor of Kendari Andi Muzakkir Mustafa and other local senior officials.

Likewise, other civil servants in Kendari were also nominated for campaign teams for Susilo and Kalla, and Megawati and Hasyim.

Among the names put forward were Ayub Padangarang, Kanna, Idrus Mufty and Aminah Razak Porosi -- all lecturers of the law faculty of Haluoleo University.

Zainal Abidin, spokesman for Susilo's Kendari campaign team, admitted several civil servants were included as they had voluntarily registered, despite the rules.

However, Zainal said the ban on civil servants' involvement should be regulated in more detail.

He said his team had not been informed by the KPUD of the outcome of its proposal.

Similarly, Wiranto's Kendari campaign team spokesman Fikri Yunus said his side had not been officially notified that the KPUD had rejected its proposed team.

Fikri and Zainal said they would restructure their teams to comply with the regulations.

Five parties set to endorse Amien Rais

Xinhua News - May 28, 2004

Jakarta -- Five political parties in Indonesia are ready to declare their support for National Mandate Party (PAN) presidential candidate Amien Rais, PAN secretary-general Yasin Kara said yesterday.

They are the Marhaenism National Party, the Freedom Bull National Party (PNBK), the Reform Star Party (PBR), the United Indonesia Party (PSI) and the Socialist Democratic Labour Party (PBSD).

"The political parties will declare their support during a meeting to be held at the Kafe Tenda Senayan restaurant today," he was quoted by the state news agency Antara as saying. The choice of an open-air restaurant for the declaration of the parties' support for Mr Amien and his vice-presidential candidate Siswono Yudhohusodo shows the people that it is not an exclusive gathering, he said.

The parties had previously chosen the Al Azhar mosque as the venue, said Mr Yasin, who is on Mr Amien's campaign team. He said the parties were planning to hold the declaration of support last week but the timing did not work out.

Mr Amien recently said it was not easy to unite so many parties: "The coalition is made for a national leader so it must be formed carefully."

Indonesia's KPU denies poor links with Panwaslu

Antara - May 28, 2004

Jakarta -- Indonesia's General Elections Commission (KPU) has asserted that it is by no means underestimating the existence of the Election Monitoring Committee (Panwaslu), and that it has no plan to replace Panwalu members, KPU deputy chairman, Ramlan Surbakti, said here Thursday.

Ramlan noted that he found it necessary to clarify the development on the latest report on the alleged distant relations between the KPU and the Panwaslu.

He said KPU does not want to underestimate Panwaslu by turning down its recommendation to KPU to reprimand violators of the legislative election campaign.

Asked about Thursday's report that the KPU will replace Panwaslu members found guilty of violating KPU's regulation, Ramlan said the report was only based on a question raised by a reporter to him. He however added that the report did not mean that KPU wants to underestimate the Panwaslu.

No. 1 isn't unreachable anymore for Wiranto

Straits Times - May 28, 2004

Derwin Pereira -- The political star of retired general Wiranto appears to be getting brighter.

The former military commander, who more than three years ago suffered an ignominious exit from politics, has now taken a big step towards clinching the presidency in Indonesia.

In a coup over his rivals, he secured the endorsement of the Nation Awakening Party (PKB) -- the country's third largest party, which is linked to the 40-million-strong Nadhlatul Ulama (NU).

And in a charm offensive on the international front, he is plotting a meeting with Timor Leste leader Xanana Gusmao tomorrow. The ex-general is accused of complicity in the 1999 Timor Leste imbroglio.

Winning PKB's backing, however, seems to be more significant in terms of shifting the political balance in his favour. It is a major boost for the retired general, who also has at his disposal the support of Golkar which won the most seats in Parliament in the April legislative election.

Golkar deputy chairman Marzuki Darusman, who led negotiation talks with PKB, told The Straits Times yesterday: "This is a major turning point in Wiranto's campaign for the presidency. He has got the support of two big parties, which makes him a major force in Indonesian politics." PKB won 10 per cent of the seats in the parliamentary poll, most of the votes coming from the NU home base of East Java.

Mr Wiranto has picked as his running mate Mr Solahuddin Wahid, the younger brother of former president Abdurrahman Wahid who is PKB's chief patron. Both brothers are top leaders of NU which is Indonesia's largest Muslim organisation.

Mr Abdurrahman played a key role in getting PKB to endorse the Wiranto candidacy after having been disqualified by the General Election Commission last week from taking part in the race.

He told reporters: "We've reached a decision to back Solahuddin Wahid as a vice-presidential candidate from PKB in a ticket with Wiranto. PKB needs someone in the race."

The Wiranto camp is jubilant. But observers believe it is not going to be easy for him to galvanise total NU support. NU members traditionally do not vote in a single block. Part of the the NU vote could go to Mr Hasyim Muzadi and Mr Susilo Bambang Yudhoyono.

Indeed, at least one opinion poll last month indicated that the vote would split. However, former security czar Bambang remains the more popular candidate, recent polls have shown, with the support of 40 per cent of NU. Mr Wiranto and Mr Abdurrahman are ranked very low on the list.

Mr Wiranto faces another problem. He also does not have the full backing of the Golkar machinery, with subversive elements in the party -- led by chairman Akbar Tandjung -- trying to block his chances.

But depending on whether he can strike a deal with Golkar and PKB -- which is asking for several Cabinet seats, including a senior post for Mr Abdurrahman -- Mr Wiranto has in effect the most potent machinery to deploy for the July 5 election. The key is whether party machinery will count as much in Indonesia's first direct presidential poll. The Wiranto camp thinks that its huge infrastructure and network will do the job for it.

It is now moving on the international front which has long been the Achilles heel of Wiranto's candidacy. Mr Marzuki disclosed that meeting with Mr Gusmao in Bali was aimed at 'mending ties' with the Timor Leste leader in the hope that the former Indonesian territory would back down on attempts to incarcerate Mr Wiranto.

A Timor Leste tribunal last week issued an arrest warrant for him over the violence, mostly blamed on pro-Jakarta militias backed by elements of the Indonesian military. Mr Wiranto was armed forces commander at that time.

At a broader level, Mr Marzuki said the goal was to project an image to the international community that the former general was taking the first step at reconciliation. The key is whether such PR will have any bearing for the hawks on Capitol Hill.

Mr Wiranto's star is shining, but major hurdles remain that make his chances of winning the presidency still far from certain.

Wiranto's first trip abroad since Timor warrant

Reuters - May 28, 2004

Jakarta -- Indonesian presidential candidate Wiranto is expected to travel to Singapore on Friday on his first trip abroad since a human rights tribunal in East Timor issued an arrest warrant on May 10 against the former military chief.

He was due to have lunch with Singapore's Senior Minister Lee Kuan Yew and possibly Prime Minister Goh Chok Tong, a senior official of Wiranto's party said.

Another official said it would be Wiranto's first trip abroad since the warrant was issued for crimes prosecutors say were committed during the tiny territory's bloody break from Jakarta rule in 1999.

Wiranto was chief of Indonesia's military at the time. He has denied responsibility for any human rights violations and said he is interested in good relations with East Timor.

Five small parties ready to declare support for Amien

Antara - May 27, 2004

Jakarta -- A number of political parties are ready to declare their support for National Mandate Party (PAN) presidential candidate Amien Rais, PAN secretary general, Yasin Kara said Thursday.

Ready to give their support for Amien are Indonesia's Marhaenism National Party, the Freedom Bull National Party (PNBK), the Reform Star Party (PBR), the United Indonesia Party (PSI), and the Socialist Democratic Labor Party (PBSD).

"The political parties will declare their support during a meeting to be held at the Kafe Tenda Senayan restaurant tomorrow (Friday)," he said. The choice of an open-air restaurant for the declaration of the parties' support for Amien and Siswono, shows the people that it is not an exclusive gathering, he explained.

The parties previously chose the Al Azhar mosque as the venue but changed it, said Yasin, who is also a member of Amien's campaign team.

He said the parties were planning to hold the declaration of support for Amien and his running mate Siswono Yudohusodo last week but the timing did not work out.

Amien recently stated that it was not easy to form a coalition of many parties. "Forming a big coalition is not the same as setting up a small firm. The coalition is made for a national leader so it must be formed carefully," he said.

Gus Dur sues over disqualification

Straits Times - May 26, 2004

Jakarta -- Indonesia's former president Abdurrahman Wahid is suing the General Election Commission for US$110 million (S$189 million) after it disqualified him from the July presidential race on health grounds.

Mr Abdurrahman, who was impeached for incompetence in 2001, said he is suing the election commission for its arrogance, discrimination against a disabled person and for crippling democracy.

He filed a civil suit against three institutions he deems responsible for disqualifying him from the July 5 direct presidential election -- the General Election Commission (KPU), the Ministry of Health and the Indonesian Doctors Association (IDI).

Lawyer Ikhsan Abdullah said a health examination was not adequate to gauge whether or not someone could be declared physically fit to run for the presidency.

The health examination criteria for presidential candidates were drawn up jointly by the KPU and the IDI.

Mr Ikhsan also said that one of KPU's regulations on qualifying candidates was discriminatory and constituted a violation of human rights.

"We will also seek a judicial review by the Supreme Court on the ruling," he said. The team filed a petition for the review yesterday. When asked why the Health Ministry was included in the suit, he said the ministry was responsible for authorising the cooperation between the KPU and the IDI.

In a departure from his usual open manner, Gus Dur declined to comment on the move. Immediately after handing the suit to the court bailiff, he was rushed to a van that took him to the headquarters of Muslim organisation Nahdlatul Ulama (NU) in Central Jakarta.

The KPU declared on Sunday the five pairings that had qualified for the presidential race, excluding Gus Dur and running mate Marwah Daud Ibrahim, who were nominated by the National Awakening Party (PKB).

KPU deputy chairman Ramlan Surbakti hailed Gus Dur's legal move, saying it was better than calling on his supporters to take to the streets and resorting to violence.

Meanwhile, Mr Wiranto's running mate and former human rights activist Solahuddin Wahid, who is Gus Dur's brother, said PKB should fulfil its promise to support the Golkar candidates following Gus Dur's disqualification.

PKB leaders and a group of NU clerics agreed in their meeting in East Java earlier this month to support the Wiranto-Solahuddin duo if Gus Dur was disqualified.

Mr Solahuddin was quoted by Antara as saying he would utilise the political network of the PKB and Golkar.

Presidential hopefuls prepare for campaign

Radio Australia - May 26, 2004

Indonesia's presidential candidates are gearing up for the official start of campaigning next week. Five pairs of candidates will contest the July 5th election. The front runner at this stage is controversial former military chief, General Wiranto, representing Golkar.

Presenter/Interviewer: Sen Lam

Speakers: Nuim Khaiyath, executive producer of Radio Australia's Indonesian service

Khaiyath: The main players of course are three are former generals. One is SBY Susilo Bambang Yudhoyono, Wiranto and of course Agum Gumelar who is the vice presidential nominee for Hamzah Haz, the current vice president of Indonesia. And of course Megawati is now pairing with the former head of Nahdlatul Ulama, considered to be the biggest Islamic organisation in the world, not only in Indonesia with over 40 million membership. And Amien Rais of course has got Siswono as his running mate.

Lam: And of course as you mentioned there are three generals there. Does one get the impression that Indonesians can't get enough of the military in politics?

Khaiyath: Well that's what I like to say, it's like the triumph of hope over experience. Just about five years ago the military was the most hated institution in Indonesia, and now suddenly it looks like there's SBY and of course Wiranto with a very good chance of becoming the next Indonesian president. It is because they say Indonesians whether they want to admit it or not, they need a strong leader, and they can only get a strong leader in their mind by having a military person up there.

Lam: And of course Golkar's track record is hardly illustrious.

How do you account for Golkar's popularity, may we read its parliamentary election some indication as to how the August presidential poll might go?

Khaiyath: It looks like it, Wiranto has got a very, very good chance. But SBY is somebody you cannot overlook. But why did Golkar do so well? It's because the political machine that they have, and it's always functioning, it never really went out of order, so although in Java perhaps Golkar did not do as well as they could have done, but outside Java Golkar is still being identified and still being considered as synonymous with power.

Lam: And what about the former general and security minister Susilo Bambang Yudhoyono? How do you account for his popularity?

Khaiyath: Well he's very popular now but many people are still saying that he is kept in the back because not many people have known about him. Wiranto might have been notorious but I think that notoriety is to his advantage, and the fact that a warrant was issued by a United Nations-backed tribunal in East Timor is only going to help him, because Indonesians are saying well this man must be something or else why even the United Nations wants to take him on. So I think it is to his advantage to have this warrant issued.

Lam: So does that almost mean that many Indonesians do not care about what happened in East Timor and General Wiranto?

Khaiyath: Not what happened in East Timor, I think what still rankles with many, many Indonesians is the fact that East Timor is no longer part of Indonesia. For a country that was for about 300 to 150 years being under colonial rule to have lost something and then to put the blame on Australia having the machinations for East Timor to be separated from Indonesia, that rankles. And therefore people are looking at East Timor as a fifth column for "the Caucasian" or the white powers.

Lam: The former president Abdurrahman Wahid is out of the race, but his party, the PKB has thrown its weight behind Golkar. Do you find that surprising?

Khaiyath: That's not very surprising because look the vice presidential nominee for Golkar is Salahudin Wahid, the younger brother of Abdurrahman Wahid. He is also or he was one of the vice chairman of Nahdlatul Ulama. If you look at Abdurrahman Wahid, a very, very shrewd man. When he took over Nahdlatul Ulama in the 80s he declared Nahdlatul Ulama would no longer play politics, that Nahdlatul Ulama would go back to its original declaration of its charter and that was to become a social organisation and educational organisation. That allowed Nahdlatul Ulama to have its people in all political parties in Indonesia, to the extent that now you see the vice presidential nominee for SBY is Jusuf Kalla and Nahdlatul Ulama's person. And of course Wiranto the same thing, and of course Megawati with Hashim Muzati, also somebody from Nahdlatul Ulama. So it seems that not only the military, but Nahdlatul Ulama is having its finger in every case.

Lam: But given the fact that NU was concerned with social and other issues, it was also a reformist organisation. The fact that it's throwing its weight behind Golkar isn't that surprising?

Khaiyath: Well it doesn't want to put its eggs in one basket in the sense that look if SBY wins then Jusuf Kalla the vice president is from NU. To have Salahudin behind. So what happened was when Wiranto decided to have Salahudin as his vice presidential running mate he decided that that would somehow temper his image as a very strong, very stern, very staid military person, to have somebody like Salahudin Wahid, the deputy chairman of the Indonesian natural commission for human rights and to have somebody coming from Nahdlatul Ulama, a very powerful organisation, although they might not be voting as a block, but it is still very powerful. And now it's P.K. bid, which is Abdurrahman Wahid's party throwing its weight behind Salahudin Wahid, meaning to say behind Wiranto, it's a very interesting thing.

Nuim Khaiyath, executive producer of Radio Australia's Indonesian service.

Wiranto's rise makes markets nervous

Australian Financial Review - May 26, 2004

Andrew Burrell -- Sprawling across the entire 21st floor of one of Jakarta's ritziest office towers, the campaign headquarters of presidential contender Wiranto is filled with solemn loyalists plotting the strongman's campaign.

"These offices are on loan from a businessman friend of MrWiranto," explains Fachrul Razi, a top campaign strategist and a long-time ally of Indonesia's former military chief.

The "loan" of the headquarters at the Menara Imperium building -- where Tommy Soeharto in his heyday would routinely land his chopper on the roof to party at the top-floor nightclub -- is a sure sign that Wiranto has friends in all the right places.

On the eve of Indonesia's month-long presidential campaign, Wiranto's camp has plenty of work to do: he still trails the frontrunner, retired general Susilo Bambang Yudhoyono, by a wide margin.

But a credible opinion poll to be released this week will show Wiranto enjoying a solid pick-up in support since his surprise nomination last month as the candidate for Golkar, Indonesia's most popular political party.

The survey will confirm that Wiranto, the former adjutant to deposed dictator Soeharto, has begun his inevitable climb in the polls -- his popularity has consistently been rated in the low single digits -- that some believe could culminate in his swearing-in as president in October.

Wiranto's strategists are planning a television campaign next week that will emphasise his strong leadership and patriotism.

One of these ads could be particularly effective: it features 1998 footage showing Wiranto, who was military commander at the time, decked out in full regalia making a speech. Behind him is Yudhoyono, his then subordinate.

Wiranto will also travel, using a private jet, to all of Indonesia's 32 provinces, backed by Golkar's extensive machine and flush with funds from mystery donors.

Wiranto's aides are confident they still have several months to build on his popularity, convinced that the election will go to a second round in September between the top two from the initial poll on July 5.

"We have never thought that there will be only one round to the election. The assumption is there will be a second round because no one will win more than 50 per cent of the vote," says Fachrul, a former deputy chief of the armed forces.

"We are more optimistic now since we [Golkar] won the legislative election [on April 5] with 21 per cent of the vote. And we have a bigger political vehicle compared to the other candidates."

Wiranto's camp believes he can win, at most, 40 per cent of the vote on July 5, given he will have the backing of former president Abdurrahman Wahid's National Awakening Party, which won 11 per cent of the vote last month.

Indonesia's election commission has blocked Wahid from running on health grounds.

Wiranto, who has been indicted for war crimes by the United Nations for his role in the East Timor bloodshed in 1999, is not the preferred choice for president by Australia and the United States.

And, increasingly, it seems he is also not the choice of the financial markets or foreign investors, who would prefer to see Yudhoyono and his market-friendly running mate, Jusuf Kala, in charge.

What makes many foreign business people especially nervous is that Wiranto's main economics adviser is Rizal Ramli, a nationalistic former chief minister for the economy who is known for his bitter relationship with the International Monetary Fund.

Insiders believe Ramli will be restored to his old job should Wiranto win the election, imperilling any hopes of spurring foreign investment.

Wiranto's rise, and the general uncertainty in Indonesia, is already making the markets jumpy.

The belief that the election will be closer than anyone had thought is one of the factors behind the recent weakness in Jakarta's stockmarket.

"We are now seriously factoring in the possibility that Wiranto could be president of Indonesia," a leading Jakarta broker said last week. "And there is a belief that he would not be market friendly."

Back at Wiranto's headquarters, Fachrul, a retired four-star general, denies rumours that Wiranto's campaign will be largely funded from Soeharto family coffers.

This is despite the fact that Wiranto has already won the backing of the former president's daughter Tutut, whose own party failed to win enough votes for her to contest the presidential election.

"Tutut will support but will not give any money," he says.

Fachrul also scoffs at suggestions that the human rights abuse allegations against Wiranto -- a UN-backed tribunal has issued an arrest warrant -- will prove a factor among grassroots voters.

His record on promoting reform in Indonesia would outweigh the East Timor claims, he predicts.

And Fachrul insists that the election will be fought cleanly.

"For us, we will not undermine other candidates ... everyone has the same chance to become a winner."

Bambang to seek growth that benefits 'the small people'

Straits Times - May 27, 2004

Shefali Rekhi -- Indonesia's economy might be improving, but this has not translated into a "feel good" factor among the people on the ground.

The result: a disconnect between the rosy macroeconomic indicators and what ordinary folks feel about the country's economic growth, said Mr Susilo Bambang Yudhoyono, the front runner in the race for the Indonesian presidency on July 5.

"There is something artificial about the prosperity we are seeing now," the former general and Cabinet minister noted, pointing out that much of the nascent recovery is because of increased consumer spending. There is also a "disconnect", he said.

"The macro indicators are not mirrored in the microeconomic picture. People are complaining that the costs of basic education have risen sharply. So have the costs of telephone calls, electricity, construction materials. Clearly, the big numbers are not reflected down to the small people."

Mr Bambang was delivering a talk on his vision for shaping his country's future as part of a series of lectures on Indonesia's presidential election, organised by the Institute of Defence and Strategic Studies and The Straits Times.

Asked by several members of the audience at the Shangri-La Hotel what he planned to do to promote business, draw investors and boost growth in the country, he said Indonesia needed to push for a growth rate of 7 per cent a year, up from its present growth rate of 4.5 per cent, to improve the welfare of its people.

The four key planks he outlined in his speech for economic recovery were: infrastructure, human resource development, easier availability of credit and legal reforms.

With a view to attracting foreign investors, he is also promising to make state-owned enterprises efficient, make the tender processes more transparent, cut red tape and significantly improve labour laws. Steps would also be taken to boost security and maintain stability in the country.

Mr Bambang has his task cut out for him. Elections have stymied the rate of recovery of an economy that was hit by the 1997 financial crisis. Foreign investors have been shying away and export growth rates have been slackening, though regional economies have been doing far better.

To change that, Mr Bambang wants to pump more money into public works, which could include improving utilities and housing, improving rural-urban linkages as well as helping key areas in the rural zones to ensure better agricultural harvest.

"Infrastructure development is key," he said. "Economic growth simply cannot take off if everyone spends too much of their time stuck in traffic." From his speech, it was not quite clear how his government would fund these plans.

But Mr Bambang's plan to push for growth with a human face showed up in his commitment to reform education and health care services and to make sure the gains are shared by many instead of a few.

His government will improve the national curriculum, increase the ratio of teachers to students and spend more on libraries, he said. Local governments will be encouraged to improve training facilities for workers and there will be more money spent on building clinics and subsidising some medical facilities.

There will also be a concerted effort to improve civic education to foster a spirit of unity in the country. Small and medium enterprises -- the avenues for more jobs -- will get softer credit or cheaper loans.

"I say this because I am constantly haunted by the faces at campaign rallies," Mr Bambang said. "It is for them that I aim to make economic recovery my No. 1 priority in my first 100 days in office."

Regional/communal conflicts

Tensions simmer in Ambon

Antara - May 28, 2004

Ambon -- Maluku's provincial capital of Ambon was tense again on Thursday following a traffic accident and bomb explosions in Pardais Tengah at around 7.51 pm.

Police had to deploy six armored vehicles to prevent people belonging to different community groups from attacking each other. Columns of police took up positions in Jalan AM Sangadji and Jalan Diponegoro to contain people of different communal affiliations in their respective residential areas.

Ambon resort police chief Adjunct Senior Commissioner Leonidas Braksan led officers in the field in persuading residents to refuse being provoked, stay home and leave the settlement of any breach of the peace to the police.

He said the tensions began following a collision between public transport vehicles in the afternoon. He urged people to refer any security problem to the authorities.

Tensions high in Ambon

Radio Australia - May 24, 2004

In the Indonesian province of Maluku, road blocks and barricades have been erected in several parts of Ambon after two weekend bomb blasts. Local police say the attackers are trying to provoke violence between the muslim and christian communties. There are also claims that those responsible have a clear political agenda.

Presenter/Interviewer: Sen Lam

Speakers: Bishop Petrus Mandagi, head of the Catholic church in Ambon

Mandagi: "This explosion to some extent will raise tension in Malukus up to now, in Ambon this bomb blast is a part of a provocation to create conflict in Ambon, to enlarge the present conflict in Malukus, in Ambon especially."

Lam: So you agree with local Malukun police who think that the bomb blasts were staged as a ploy to stir up local hatred?

Mandagi: "Yes, yes I agree with this, because bomb blasts placed in the village, people in that village are Christians. This bomb blast to provoke the Christian people here in Ambon so that they can feel that maybe this bomb was placed by the Muslim people. So the provocateur tried to make Christians and Muslims involved in conflict."

Lam: So do you think these provocateurs are not from within the local communities?

Mandagi: "They are in local community but I think they are not refer to directly to Muslim or Christian. They belong to neither group; maybe it's their link to those in Jakarta for presidential election you know."

Lam: What can you tell us about these groups?

Mandagi: "Maybe these groups is created by politician that will show the world that the city of Ambon is not at peace. It means that the present government are not able to create peace in Ambon, that's why the present government has to be changed for another president."

Lam: What's the environment like? What's the atmosphere like in Ambon today? Is it very tense? Mandagi: "I think people here become more mature and the people now in Ambon either Muslim or Christian are mature, they're now wise to see that this conflict are created for political interest."

Lam: And yet we've received reports of barricades made up of tyres, rocks, bamboo, whatever material people can lay their hands on, of barricades being setup in main streets in Christian and Muslim communities. Have you seen any barricades being setup?

Mandagi: "Yes last week especially since the coming of Megawati, a group of people called Posco anti-LMS it means the group belong to those who rejected separatist group LMS. This group lays obstacles, barricades in several roads in Ambon."

Lam: And this is in protest against President Megawati's visit on Saturday?

Mandagi: "They want to take attention from Megawati, that we now in Ambon we are in conflict, so you see these are obstacles here in the streets. The people in Ambon either Christian or Muslim, they want to come together, they want to live together, but it's not easy to be a leader there. There are many groups there and each group has his own interests, to me not so easy for Muslim leader, and we have to support the brotherhood between the Christians and Muslims in Ambon. The moderate Muslim here in Ambon they like the conflict to stop, and the Christians and Muslims come together, live together."

Two bomb explosions rock Ambon

Antara - May 27, 2004

Ambon -- Two bomb explosions shook Ambon, Maluku's provincial capital, on Wednesday striking fear into the hearts of the local population.

The first bomb explosion occurred in the sensitive Mardika- Batumerah area in the subdistrict of Sirimau at around 9.35 pm and the second bomb exploded in the Trikora Monument area in the subdistrict of Nusaniwe 10 minutes later. There have been no reports of casualties or damage so far.

Sectarian clashes erupted again here last April 25, triggered by the commemoration of the 54th anniversary of separatist RMS (South Maluku Republic) movement.

There have been three bomb scare incidents earlier that day. One person died and 12 others were wounded in the bomb explosion in Batumeja, Sirimau, on Tuesday.

Human rights/law

Compromise reached on domestic violence bill

Jakarta Post - May 29, 2004

A. Junaidi, Jakarta -- The government and women activists have settled their dispute on a controversial article on marital rape in the domestic violence bill which, if enacted, will carry a maximum sentence of 20 years in jail.

"During our last meeting with government officials, we agreed to maintain the article, on condition that a police report should be based on a victim's complaint," director of the Legal Aid Institute/Association of Indonesian Women for Justice (LBH-APIK) Ratna Batara Munti said.

Officials from the Ministry of Religious Affairs and the Office of the State Minister of Women's Empowerment had earlier rejected marital rape as a crime based on interpretation of religious teachings and moral and cultural judgments.

Ratna said the activists had agreed with the government's demand for the exclusion of an article that required the state to provide compensation to victims of domestic violence.

"We also agreed that the bill would not be retroactive," Ratna told a press conference at the office of the National Commission on Violence Against Women (Komnas Perempuan).

The commission earlier reported a persistent increase in the number of reports of violence against women over the last three years. From 3,169 cases reported in 2001, the figure rose to 5,163 in 2002 and 5,934 in 2003.

Of the cases reported last year, only 162 went to court, while the others were withdrawn by the victims or dropped due to insufficient evidence.

A women's non-governmental organization, Kalyanamitra, reported on Thursday there were 806 cases of violence against women last year that involved mostly children and teenagers.

"Most of the victims were underaged while the perpetrators were people close to the victims, like fathers, stepfathers, husbands, uncles and neighbors," Kalyanamitra researcher Dina Permana Sari said in a discussion.

Dina said last year's cases of violence against women were categorized into rape (558 cases), domestic violence (150 cases) and sexual harassment (98 cases).

She said the research was based on reports from 10 newspapers across the country: The Jakarta Post, Kompas, Republika, Pos Kota of Jakarta, Pikiran Rakyat of Bandung, Waspada of Medan, Singgalang of Padang, Suara Merdeka of Semarang, Kedaulatan Rakyat of Yogyakarta and Memorandum of Surabaya.

Articles related to marital rape

Article 5: Prohibited acts categorized as domestic sexual violence:

a. Sexual harassment;
b. Forcing another to have sexual intercourse;
c. Forcing another to engage in unnatural sex acts or any act with which they are uncomfortable;
d. Forcing another into intercourse for commercial or other purposes;
e. Damaging a women's reproductive organs.

Article 54: Anybody who perpetrates domestic sexual violence as mentioned in: a. Article 5 (a) is liable to a minimum four years and maximum 10 years in prison or a minimum Rp 4 million and maximum Rp 10 million fine.

Article 5 (b) is liable to a minimum four years and maximum 15 years in prison or a minimum Rp 4 million and maximum Rp 50 million fine.

Article 5 (c) is liable to a minimum four years and maximum 15 years in prison or a minimum Rp 4 million and maximum Rp 75 million fine.

Article 5 (d) is liable to a minimum four years and maximum 20 years in prison or a minimum Rp 4 million and maximum Rp 100 million fine.

Bill on domestic violence faces government challenge

Jakarta Post - May 29, 2004

Muninggar Sri Saraswati, Jakarta -- The contents of a draft domestic violence law are considered so sensitive by the government that it has been reluctant to start deliberations in the House, despite the fact that the bill was initiated by the legislature six years ago.

The bill deals with issues related to sex and personnel relationships, issues that are quick to get traditionalist Indonesians hot under the collar. The most contentious thing in the bill is the article on marital rape and sexual abuse. The bill outlaws both of these forms of violence against women.

Article 5 of the bill makes it an offense for a person to perpetrate sexual abuse, an unwanted sexual act, a sexual act that is not common and/or accepted, a sexual act with another person for prostitution or other purposes, or who forces another person to witness a sexual act.

"A number of government officials, particularly those from the Ministry of Religious Affairs, oppose the bill. They consider that wives are supposed to obey their husbands, including in the bedroom. They back this up by citing religious arguments," said Estu Fanani of the Legal Aid Institute/Association of Indonesian Women for Justice (LBH APIK), which was involved in the drafting of the bill. "We are seeking recognition that women have the right to control their own bodies," Estu said.

Domestic violence, which mostly affects women, has long been ignored in Indonesia's conservative and male-dominated society, she added.

The fact that the ambit of the bill also extends to unmarried and separated couples has sparked further reticence on the part of the government. "Some government officials oppose the bill because of this issue. They won't acknowledge the rights of unmarried or separated couples. The government only accepts the existence of married couples," Estu said The bill also covers those who are related by blood, marriage, adoption, tradition or other social circumstances, and domestic servants.

Another contentious issue dealt with by the bill is economic violence. Members of a household are not allowed to do anything that could cause economic loss to the household, or which is designed to bring about economic dependency by limiting or abrogating the rights of spouses from working both inside and outside the home, or excessively controlling the expenditure of the family, such as husbands requiring their wives to submit financial reports to them.

"This is something complained of by many of the women who took part in the discussions across the country prior to the completion of the bill," Estu explained.

The latest version of the bill divides domestic violence into two categories: minor and serious. The minor category covers domestic violence such as the slapping of a spouse or family member where this does not inflict serious injury. The draft does not spell out the maximum sentence or fine for those found guilty. The second category, serious violence, involves any act that causes death or serious injury.

"The bill spells out the obligations of police officers, prosecutors, judges and members of the community in dealing with domestic violence, including marital rape, which is not yet considered by many Indonesians as being a serious crime," Estu said.

A group of women's NGOs secured the support of the State Minister for Women's Empowerment in April, just before the bill reached the House for deliberation. "We will never give our struggle up as women deserve proper protection," Estu asserted.

Reported cases of domestic violence, 1998-2002

Category	1998	1999	2000	2001	2002
Physical violence	33	52	69	82	86
Psychological violence	119	122	174	76	250
Economic violence	58	58	85	16	135
Sexual abuse	3	15	1	0	7
Rape	1	10	0	0	0
Sexual harassment	2	5	1	0	0
Violence during dating	0	0	0	0	7
Violence against children	0	0	0	0	1

Source: LBH APIK

Pornography definition, bill contents unclear: NGO

Jakarta Post - May 27, 2004

A. Junaidi, Jakarta -- Activists and experts supported on Wednesday an antipornography bill, but urged the government and the House of Representatives to drop several controversial articles in the bill, including those banning of erotic dances and kissing on the lips in public.

Director of the Women's Legal Aid Foundation (LBH-APIK) Ratna Batara Munti said the controversial articles would not be appropriate and would be impinging on freedom of expression.

"We support the bill, but the definition of pornography should be clear. The bill should aim to protect children and women from violence," Ratna said in a workshop on the antipornography bill.

She said that pornography could be defined as materials that showed human genitals explicitly, especially those of women, as an object of humiliation, sexual violence and penetration with objects and animals.

She suggested that eroticism be excluded from pornography as it was part of the right to freedom of expression. "Law enforcers could arbitrarily interpret eroticism as a crime and thus many people could be victimized if their form of expression was considered pornographic," Ratna said.

The reform era following Soeharto's downfall in 1998 has brought freedom and change, including the mushrooming of mass media that exploit women's sexuality. Pornographic materials, such as video compact discs, books and tabloids, are openly sold on the streets. Television programs show erotic material without considering the time slot or whether it is suitable for children.

It was unclear whether the inclusion of the ban on erotic dances was due to the popularity of the "drilling dance" by dangdut singer Inul Daratista.

Besides banning erotic dances, the bill, which was initiated by the Ministry of Religious Affairs, also prohibits people from exposing their genitals, buttocks or breasts, appearing naked and from kissing on the lips in public.

"I could be arrested if I kissed my wife at the airport. It's ridiculous," said Burhan Mangin, a professor in mass media sociology at Surabaya-based Untag University.

Burhan said the bill would also be difficult to implement across the country in communities that had different traditions, such as undressing to bathe in rivers, or going around half-naked in their daily life.

Gadis Arivia from the University of Indonesia feared that the bill could be misused by certain law enforcers for their own ends. "I fear that the bill may only enrich policemen, prosecutors and judges," Gadis said.

Some key articles in the bill

Article 41

(1) Exposing genitals in public - five years in prison or a Rp 250 million fine.

(2) Exposing buttocks in public - five years in prison or a Rp 250 million fine.

(3) Exposing breasts in public - five years in prison or a Rp 250 million fine.

Article 44

(1) Appearing naked in public - six years in prison or a Rp 260 million fine. Article 45

(1) Kissing on the lips in public - five years in prison or a Rp 250 million fine.

(2) Asking people to kiss in public - five years in prison or a Rp 500,000 fine

Article 46

Performing erotic dances in public places - five years in prison or a Rp 250 million fine.

Article 47

(2) Simulating masturbation - five years in prison or a Rp 250 million fine

(3) Asking people to simulate masturbation - five years in prison or a Rp 250 million fine.

Source: Anti Pornography Bill

Focus on Jakarta

City under fire for 'discrimination' against sidewalk vendors

Jakarta Post - May 27, 2004

Damar Harsanto, Jakarta -- The city administration was slammed on Wednesday for what critics said was its harsh treatment of sidewalk vendors, while at the same time turning a blind eye to businesses being run out of houses not designated for commercial or business purposes.

"It is OK if the administration wants to uphold the regulations, even by force, but please do not discriminate," said Adolf Heuken, the author of several books on Jakarta's history.

Heuken said the administration discriminatorily enforced Bylaw No. 11/1988 on public order by forcibly evicting sidewalk vendors but turning a blind eye to other enterprises that also violated the bylaw.

"Look at the Menteng residential area [in Central Jakarta]. Many houses have been converted into commercial places, but the administration has yet to take action to regularize them," he said.

Heuken was a panelist at a book discussion at the Jakarta Media Center in Central Jakarta to celebrate the fourth anniversary of non-governmental organization the Jakarta Residents Forum (Fakta). The book being discussed was Fakta's recently released Bunga Trotoar (Sidewalk Flowers), a survey of street vendors in the city.

Panelist Agustinus Herwanto of Fakta also voiced concern over the administration's policies. "If the administration is not discriminative, why does it allow gas stations, malls and shopping centers to occupy green zones across the city?" he asked.

Street vendors are frequently blamed for traffic congestion because they take over the sidewalks and spill over into the road.

The administration earlier said it lacked the space to accommodate all of the street vendors in the city. Officials said they could only provide space for 6,609 out of 147,000 registered sidewalk vendors, plus the thousands of unregistered ones.

Tasman, a street vendor in Jatinegara, East Jakarta, said about 250 vendors in the area had been trying in vain to obtain permits from the municipality for the past two years. Instead, he said, the vendors had to deal with extortion by thugs and officials.

"The community unit chief even demands a fee from us, saying it is part of the implementation of the autonomy law. Is that reasonable?" he said.

Heuken said street vendors first really appeared in the capital in the 1950s. However, the administration has never come up with a spatial planning concept to accommodate the vendors.

And, he said, with the lack of job opportunities in the city more and more people will set themselves up as small-scale entrepreneurs in order to survive.

News & issues

Hendropriyono challenged to explain measures against NGOs

Kompas - May 29, 2004

Jakarta -- General Hendropriyono, the chief of the National Intelligence Agency, BIN, has been challengd to reveal in public the information he submitted to parliament (DPR) about twenty local and foreign NGOs which are accused of disrupting national security in the period leading up to the presidential election on 5 July. He has been asked to explain the political motivation for this.

The challenge was issued by the coordinator for Kontras, the Commission for the Disappeared and Vicitms of Violence, Usman Hamid, the Director of Imparsial (Indonesia Human Rights Monitor), Rachland Nashidik, and Hendardi of PBHI, the Legal Aid and Human Rights Advocacy League in a press release issued on 28 May.

As earlier reported, BIN announced that a number of local and foreign NGOs are deemed to be a threat to national security. Among the twenty NGOs is the International Crisis Group whose representative in Indonesia. is Sidney Jones, and ELSHAM, the Institute for Advocacy and Human Rights in Papua.

Commission I of the DPR is also pressing BIN to take preventive measures and, if necessary, arrest NGOs which jeopardise national security, including excluding Sidney Jones.

The submission to the DPR by BIN is seen by Kontras, Imparsial and the PBHI as proof that it is hostile towards the freedom of political rights and democracy. Still worse. BIN is spreading disinformation to the public that the expression of political rights is a threat to security.

"We need to know BIN's political motivation in spreading such information. Is it related to the growing opposition to military presidential candidates or are there other motives?" said Hendardi.

The actions taken by the chief of BIN is beyond its powers and should provoke a reprimand from the president. "What we want to know is whether this measure is being taken as part of the policy of the Megawati cabinet. If this is the case", he said, "this signifies that Megawati, as a presidential candidate, has failed to emerge as a non-militaristic candidate. If not, it is giving an erroneous impression of the views of Megawati".

The view that oganisations within civil society can influence international opinion is very naive. There have been many reports in the media about criticisms of the government emannating from NGOs.

Usman Hamid also said that the decision to expel Sidney Jones is highly irresponsible. The support being given by the DPR would appear to represent the views of certain political parties which consider that they are being harmed by NGO activities.

[Translated by TAPOL]

BIN has not officially recommended Jones be expelled

Koran Tempo - May 28, 2004

Jakarta -- An intelligence coordinating meeting which was held yesterday has yet to officially recommend that the director of the International Crisis Group (IGC) Sydney Jones be expelled from Indonesia.

This was related by the head of the State Intelligence Agency (BIN) A.M. Hendropriyono."We have been gathering data on people or groups which [we] consider are hurting the country", said Hendropriyono following a cabinet meeting in Jakarta yesterday. Nevertheless he continued, firm action must be taken against non-government organisations (NGOs) who creating social unrest and damaging the state.

In addition to this the former head of the Jakarta military command accused a number of NGOs of selling out their own country for the sake of money. "It's an old pattern, [like] certain NGOs who betrayed their own nation to the point where East Timor broke away, [in the past] they would have got the death sentence", he said.

Hendropriyono also took the opportunity to counter accusations that he had given a recommendation for Jones' expulsion or the extension of her visa to stay in Indonesia. However he said that"if her actions hurt the Indonesia people, why would [we] want to extend [her] stay in our country. I think that is the basic logic of it".

According to Hendropriyono not all of Jones' reports which have been published and distributed overseas are entirely accurate. As a result he said, the government will continue to provide clarification on these issues to international institutions.

Meanwhile, interim coordinating minister for politics and security, Hari Sabarno, said that the government had yet to consider a recommendation not to extend Jones' visa. According to Sabarno the problem is that the matter is still at the stage of an intelligence investigation and has yet to be reported to a coordinating meeting of the politics and security department. On the issue of Jones, "it is best if it is the DPR [People's Representative Assembly] which provides the official recommendation", he said yesterday.

When Jones was contacted yesterday she said that she had been encountering difficulties in obtaining a visa extension since February. She said she had submitted a request for a visa extension for the period May-April to the department of labour and transmigration but it was rejected because there were problems cited by a particular department. According to Jones, which department and the reasons for the problem were not mentioned. When asked if it was because of the reports issued by ICG she answered, "I don't know, possibly".

She said that she had already requested a meeting with a member of the DPR's commission on defense and BIN however there has been no response.

The issue of a recommendation that Jones' visa not be extended was raised in a BIN working meeting with the DPR's commission on defense. According to the deputy chairperson of the commission, Efendy Choirie, they agreed with BIN's recommendation to repatriate foreign NGO activists, one of which was Jones, because they were not just carrying out research. "Under the guise of empowering society there is obviously a special mission as was uncovered by BIN [in its investigations] on the ground", he said.

Another DPR member, who did not want their name quoted, said that the contents of the BIN report did not provide any details at all on Jones' activities.

The 46 page document only refers to the existence of a plan to disrupt security which is being developed by specific foreign organisations. In one part of the document which was seen by the Tempo News Room yesterday, it said that "These organisations are continually trying to meddle in Indonesia's domestic affairs". The two names which were mention were Jones as the project director of IGC Indonesia which is based in Australia and May Lane [Max Lane] from the Socialist Democratic Party [Democratic Socialist Party], Australia.

Based on BIN's observations, in the same report is said that Jones' activities in Indonesia were not in accordance with her position as a social worker. It said that she had put greater emphasis on activities related to political issues. This included a belief that Jones had criticised the government's policies on the Papua and Aceh question.

Jones was also accused of giving political lectures which essentially slandered and seriously damaged Indonesia. The document did not however explain in detail the contents of these criticisms or when and where Jones had made them.

Cultural observer Goenawan Mohammad who was contacted separately by Tempo believes that Hendropriyono's statement that there are NGOs which are creating social unrest is an indication of the reemergence of efforts to the resurrect repressive methods which were used in the past. "[We] are now beginning hear things which remind us of the insinuating ways of the period of the New Order [regime of former President Suharto] and even further back during the earlier period of guided democracy [under Indonesia's founding President Sukarno between 1959 and 1965]", he said yesterday.

[Translated by James Balowski.]

Prosecutors given police guard

Jakarta Post - May 29, 2004

Abdul Khalik and Ruslan Sangadji, Jakarta/Palu -- Prosecutors and judges in conflict areas have been provided police protection following Wednesday's murder of prosecutor Ferry Silalahi in the Central Sulawesi capital of Palu.

National Police chief Gen. Da'i Bachtiar said all Palu prosecutors were being provided individual guard by police officers and that prosecutors and judges in other conflict areas would receive similar security.

"Ferry's murder proves that prosecutors and judges are in danger. After discussing the matter with the head of the Central Sulawesi Prosecutor's Office, we decided to guard all prosecutors there individually," he said on Friday.

He said police protection would be removed after Ferry's murder was solved.

Police protection in other conflict areas will be given particularly to those prosecutors and judges who are currently handling cases that could endanger their lives, he said. Police are deploying two-thirds of its 250,000-strong force to maintain security prior to the presidential election campaign period which begins on June 1.

The provinces of Aceh and Papua, where separatist movements have long been active, and Central Sulawesi capital Poso and Ambon in Maluku, which have seen a recent resurgence of sectarian violence, have been declared the most watched areas. Palu is four hours' drive from Poso.

Da'i declined to speculated on a possible motive behind Ferry's murder, saying the case was being investigated.

Meanwhile, Central Sulawesi Police chief Brig. Gen. Taufik Ridha said several witnesses had been questioned and evidence collected, but declined to release the identity of suspects in order not to undermine the investigation.

Palu prosecutor Firdaus Jahja told The Jakarta Post in Palu that immediately after the attack on Ferry, he and fellow prosecutors received 24-hour guard by fully-armed police personnel. "Our house has been guarded by a group of policemen day and night for the last two days. We are also guarded wherever we go," he said.

Firdaus also said he had received several death threats via messages and calls on his phone. The mobile phone number from which the threats originated was a Jakarta number.

Ferry, 46, was shot dead at around 10:15 p.m. on Wednesday in his car outside the residence of lawyer Thomas D. Ihalaw on Jl. Swadaya in Tana Modindi neighborhood, South Palu, just after attending an evening Mass. His body was flown into Jakarta on Friday for burial.

Ferry handled various corruption and terrorism cases, including a recent case against suspected Jamaah Islamiyah (JI) members Muhammad Fauzan, Nizam, Firmansyah, Fajri and Aang Hasanuddin. The five were tried for illegal possession of arms, munitions and explosives and for abetting and aiding Bali bombing suspect Achmad Roichan, alias Nung.

The JI regional terror network is believed to have masterminded the October 2002 Bali bombings that claimed 202 lives, and the August 2003 JW Marriott Hotel blast in Jakarta that killed 12 people, including the suspected suicide bomber.

Policeman discharged over UMI campus attack

Jakarta Post - May 28, 2004

Andi Hajramurni, Makassar -- A police code of ethics committee dishonorably discharged an officer on Thursday for his role in a brutal attack on the Makassar-based Indonesian Muslim University (UMI) that injured 65 students.

First Brig. Nur Hasyim, 28, was dismissed from the police force in a hearing presided over by Sr. Comr. Edy Muliadi, accompanied by Sr. Comr. Syahrir Kuba, Sr. Comr. Suherlan and Sr. Comr.

Herman Amin.

Hasyim was found guilty of violating the police code of ethics and Government Regulation No. 1/2003 on the police oath as he was among those who perpetrated the May 1 assault on the UMI campus.

The committee said Hasyim was no longer eligible to serve as a police officer as a result of the incident, which had damaged the honor and image of his force.

"Based on statements from witnesses and evidence presented to the hearing, he is proven guilty. Therefore ... we declare First Brig. Nur Hasyim is no longer fit to carry on as a police officer," Edy told the hearing at the South Sulawesi Police Headquarters.

Hasyim had earlier been ordered detained for 14 days by a separate police disciplinary committee and his promotion delayed for two terms in relation to the attack.

Twenty-two other officers, including 10 high- and middle-ranking ones, were also punished by the disciplinary committee for their role in the incident.

Hasyim was the first police officer to face a hearing by the police code of ethics committee, which is also scheduled to try 11 other officers.

Apart from the committee hearings, the South Sulawesi Police will also put at least 10 officers before the Makassar District Court in relation to the university incident.

During the attack, dozens of UMI students were kicked and beaten with sticks, guns and bare hands by police officers who stormed their campus over the reported hostage-taking of a policeman by the victims.

Prior to the UMI campus incident, the students had been demonstrating against the rearrest in Jakarta of elderly cleric Abu Bakar Ba'asyir, who has been charged with terrorism.

Crackdown on NGOs arbitrary: Activists

Jakarta Post - May 28, 2004

Muninggar Sri Saraswati, Jakarta -- Rights activists warned on Thursday against cracking down on non-governmental organizations (NGOs) that were critical of government policies, as the move would tarnish the country's fragile democracy.

"The move against activists is baseless. We're living in a reform era; if the government considers their reports threatening, it should discuss the issues with the activists," Todung Mulya Lubis told The Jakarta Post on Thursday.

Todung, a noted rights activist and lawyer, said suggestions that the NGOs' reports would threaten national security during the July 5 presidential election were naive. "No country, including Indonesia, is able to hide information in the world today, when communication technology has developed very rapidly," he said, adding that any crackdown against activists would have international repercussions. "There will be backlash from the international community, if the government takes firm action against activists," he said.

Police chief Gen. Da'i Bachtiar said on Wednesday that authorities were closely monitoring activists of 20 local and foreign NGOs for issuing reports detrimental to national security. Da'i did not divulge the names of the NGOs, but National Intelligence Agency (BIN) director Gen. (ret) Hendropriyono told the House of Representatives on Wednesday that the Brussels-based International Crisis Group (ICG) and the Institute for Policy Research and Advocacy (Elsam) were on the watch list.

ICG Indonesia director Sidney Jones said on Wednesday that authorities had refused to extend the work permits of the ICG's foreign staff, forcing the group to stop operating in the country and virtually telling them to leave. "The ICG is a reputable NGO founded by former world leaders. Expelling its director from the country would confirm public fears that the New Order regime is coming back," Todung said.

Arrests of activists and individuals critical of the government were common during the 32 years of the Soeharto administration, also known as the New Order. Elsam chairman Ifdhal Kasim said on Thursday he had no idea why the NGO was included on the watch list, as no government or security officials had ever complained about its activities.

"We have never received complaints from anyone, including law enforcers. Our reports are mostly about government policies on human rights and legal reforms. "Our criticisms are based on scientific analysis, because they are intended for policymakers, not for the general public. We have never violated any laws...," Ifdhal told the Post.

He said plans to crackdown on activists was intimidation against civil society, which was a common practice during Soeharto's leadership. "This kind of intimidation is the old method applied by the New Order against its opponents. It is unfortunate the culture is still alive in the so-called democratic era," he said.

The ICG has released a number of reports on a variety of issues, including the war in Aceh, religious conflict in Ambon and Poso, Central Sulawesi, activities of regional terrorist network Jamaah Islamiyah (JI) in Indonesia and security reform. Elsam has published reports on the East Timor and 1984 Tanjung Priok massacre human rights tribunals, legal reform and recommendations on the establishment of a truth and reconciliation commission.

Jakarta's police chief threatens think-tank

Associated Press - May 28, 2004

Jakarta -- Indonesia's police commander joined in the government's criticism of the International Crisis Group yesterday, threatening the think-tank with legal action if it issues 'statements that destabilise security' in the presidential election.

The threat comes a day after the Brussels-based group issued a statement saying it was being threatened with expulsion, and Foreign Minister Hassan Wirayuda complained that its reporting on the government's military offensive in the troubled province of Aceh was biased.

"We have given a warning to them," Police Chief General Da'i Bachtiar said. "Don't give statements that destabilise security in the country. If they continue to do so, we will act according to the law." Police on Wednesday said they are monitoring 20 local and foreign groups which they believe are planning to issue reports that could disrupt security ahead of the July 5 presidential election.

They did not name the groups, but the warning was the latest sign that the authorities are increasingly critical of human rights and other groups that have proliferated since the ouster of former dictator Suharto in 1998.

Since President Megawati Sukarnoputri was elected in July 2001, the government has jailed student activists and newspaper editors who criticised the President and other political leaders.

Ms Sidney Jones, who heads the ICG office in Jakarta, could not be reached for comment yesterday. On Wednesday, she said the authorities had refused to extend work permits for her and other staff members.

ICG has reported on the rising threat of Islamic militants in Indonesia, separatist wars in Aceh and Papua, sectarian violence in Central Sulawesi and the country's struggle to reform its police force and military.

Jones' case an administrative matter: Foreign minister

Antara - May 28, 2004

Jakarta -- A case involving the International Crisis Group's director, American Sidney Jones, has nothing to do with freedom of expression but is simply an administrative matter, foreign affairs minister Hassan Wirajuda said here on Friday.

"Since her case is only an administrative matter, I do not want it to be publicized," Hassan said after installing three Indonesian consuls general, as well as ministry spokesman Marty Natalegawa as the new director general of the foreign cooperation bureau.

He said that when the relevant institutions gave Jones a permit to live and work in Indonesia, they did not ask for the ministry's opinion or recommendation.

"Thus, the possibility that her work permit will not be extended is not the responsibility of the foreign affairs ministry," Hassan said, adding that the United States had not objected to the possibility of Jones' work permit not being extended.

Jones accused of harming Indonesian interests

Antara - May 28, 2004

Jakarta -- National Intelligence Agency (BIN) Chief Hendropriyono here Thursday accused the director of the International Crisis Group (ICG) in Indonesia, Sidney Jones, of having harmed the interests of the Indonesian government and nation by purveying untrue reports about Indonesia.

"According to an assessment of the Intelligence Coordination Forum, Sidney Jones and a few Indonesians have harmed the nation's interests by providing information for financial gain," Hendropriyono said after a cabinet session led by President Megawati Soekarnoputri.

Asked whether Jones would be expelled from the country, Hendropriyono said, "No, she won't but action must be taken against those resented by the Indonesian people and government."

Hendropriyono said intelligence agencies in the country had been continuously monitoring Jones' activities.

About the evaluation of some non-governmental organizations (NGOs) that the government's attitude towards Jones was reminiscent of the intolerance the past repressive regime had always shown for pro-human rights organizations, Hendroopriyono said the evaluation was was not true.

Earlier, on Wednesday, National Police Chief Gen Dai Bachtiar said, the authorities had been closely monitoring the activities of 20 local and foreign NGOs that had been issuing reports deemed capable of fueling trouble during the July 5 presidential election. Among the 20 NGOs were the Brussels-based ICG and the Institute for Policy Research and Advocacy (Elsam).

ICG Indonesia Director Sidney Jones said the Indonesian government had ordered the group to stop operating in the country as of May 10 and refused to extend the work permits of the group's foreign staff.

The group had issued a number of critical reports on a wide variety of issues, including the war in Aceh, sectarian conflicts in Ambon and Poso, Central Sulawesi, and the activities of the regional terrorist network, Jamaah Islamiyah, in Indonesia.

The BIN told the House of Representatives on Tuesday that 20 local and foreign NGOs had been working to disturb security during the country's first-ever direct presidential election on July 5.

Intelligence agency says ICG's Jones cannot stay

Jakarta Post - May 28, 2004

Fabiola Desy Unidjaja and Abdul Khalik, Jakarta -- State Intelligence Agency (BIN) chief A.M. Hendropriyono said security authorities might not extend the work permit of International Crisis Group (ICG) director Sidney Jones, claiming she had tarnished the country's image.

Being the coordinator of the country's intelligence authorities, Hendropriyono said he had enough reasons not to extend the permit. "Sidney Jones is working here with a human rights watchdog and has published or sent her reports abroad for money.

Not all of her reports are true," Hendropriyono said after a Cabinet meeting on Thursday.

"We are not expelling her, but actions should be taken against those who disturb the government and the people. Why should we let her stay here?" However, Hendropriyono fell short of citing which of Jones' reports he considered inaccurate or fictitious.

He warned that the government could exercise "old measures" against the outspoken NGOs, referring to the use of violence to clamp down on government critics under the past regime. "Since we are in a new era, we do not do that, but should we find that these people are continuing to sell out their country we may return to the old measures," he remarked.

Hendropriyono underlined that a sovereign country had the authority to take action against those who threatened national interests. "I'm not speaking about Sidney only, but Indonesian people who sell out the country," the retired three-star general said. "If they are reporting the truth then we will respect them, but if not of course we will have to reprimand them."

Security authorities are closely monitoring activists of around 20 NGOs in the country, including the ICG. The Brussels-based ICG is known for its critical reports on various security issues in Indonesia, ranging from the ongoing security operation in Aceh to the existence of Jamaah Islamiyah (JI) terrorist network here.

BIN is currently gathering more data on Jones, as well as several NGOs it considers a threat to the country's image.

The BIN chief, mandated by Presidential Instruction No. 5/2002, coordinates all intelligence activities and has the authority to review foreigners' work permits.

Interim coordinating minister for political and security affairs Hari Sabarno said the country had the right to take measures against those who threatened national interests. "We will even take actions against Indonesian nationals if they become a threat," Hari said.

Separately, National Police Chief Gen. Da'i Bachtiar said the police were currently gathering more incriminating evidence to charge the NGOs and their activists with provoking the people, causing public disturbance and sowing hatred against the government.

"We have received preliminary evidence from BIN and are currently following up the reports. If it is proven they have violated the law, we will take legal action against them," he said. He said the NGOs could be banned from operating in Indonesia and its foreign representatives could be sent home.

The government's move came ahead of the presidential election which will see President Megawati Soekarnoputri running for the presidency again. A source told The Jakarta Post that Megawati's Indonesian Democratic Party of Struggle (PDI-P) is trying to persuade Hendropriyono to stay cool at least until the election is over.

Pramoedya wins Norwegian Authors's Union award

Jakarta Post - May 27, 2004

Jakarta -- Revered Indonesian author Pramoedya Ananta Toer, 79, won the Norwegian Authors' Union award for his contribution to world literature and his continuous struggle for the right to freedom of expression.

"By showing what the risk of the expression of speech, Pak Pramoedya has demonstrated to us the value of freedom of expression," the union chairman, Geir Pollen, said in a statement issued by the Royal Norwegian Embasssy here on Thursday.

Pollen will come to Jakarta to hand a cash prize of Rp 125 million (US$13,440) over to Pramoedya in a special ceremony held at Taman Ismail Marzuki here on June 2, 2004, which is hosted by the Norwegian Embassy.

Every year the Norwegian Authors Union gives an award to authors who have made an extraordinary contribution to the right of freedom of expression in the world.

In September 2000, Pramoedya won the 11th Fukuoka Asian Culture Prize. The officials described Pramoedya as "one of the truly great winners of Asia", adding that his literary work tackled issues concerning national independence and the emancipation of mankind.

They cited his Buru tetralogy, which includes Bumi Manusia (Earth of Mankind) and Anak Semua Bangsa (Child of All Nations), were based on his story-telling to fellow political prisoners at locations where he had been exiled. The tetralogy was banned under the regime of Soeharto, who resigned in May 1998. (Darul Aqsha)

Jakarta moves to expel leading foreign researcher

Sydney Morning Herald - May 27, 2004

Matthew Moore, Jakarta -- The researcher regarded as the leading expert on the South-East Asian terrorist group Jemaah Islamiah has been stopped from working in Indonesia and has been told the visa that allows her to stay in the country will not be renewed.

Sidney Jones, who heads the Jakarta office of the Brussels-based International Crisis Group, and other staff in her office all failed to have their work permits renewed several weeks ago, and since then their office has ceased to function.

Government officials, including the Foreign Minister, Hassan Wirajuda, yesterday criticised some of Ms Jones's work, prompting her to issue a statement complaining about her treatment.

"Wirajuda reportedly told journalists and political party activists that ICG's reports were biased, and that the Government had the right to expel whomever it chose," her statement said.

"To date, ICG has received no direct communication from the Foreign Ministry, BIN [the intelligence agency], or immigration with respect to its work or the visas of its staff." She said the Ministry of Labour had told her it had received a "complaint" but it could not say who made it or what it was about. "How can we answer charges when the charges are made in secret?" she asked.

A spokesman for the Foreign Ministry, Marty Natalegawa, confirmed Mr Wirajuda had criticised Ms Jones at a breakfast yesterday attended by Indonesian journalists, but denied he said her work was biased.

"It's absolutely not the case. What [Mr Wirajuda] said was, when a question was asked about the status of Ms Jones's visa, he wondered out loud about the work of the ICG but not in the context of it being biased but he simply [posed] a well- considered question about the authority of its reports."

Mr Natalegawa said the Foreign Minister was particularly concerned about ICG reports on strife-torn Aceh province in Sumatra's western tip, but insisted these concerns played no part in the decision to stop Ms Jones working in Indonesia.

"This is totally unrelated to the question of Sidney Jones's work permit ... we are not going to fall into the trap and, nice try to Sidney Jones, make her some kind of martyr."

The decision not to renew Ms Jones's work permit has some parallels with the refusal in December 2001 to extend the work permit of the then Herald correspondent, Lindsay Murdoch, who was also criticised by the Government for his reporting from Aceh.

A research fellow in Indonesian politics at the Australian National University, Greg Fealy, said there was no doubt Ms Jones was "the foremost researcher on [Jemaah Islamiah] and South-East Asian terrorism, who has put more information on the public record about JI than any other researcher".

But, he said, not only her work on JI would be missed if she could not remain in the country. "Her work on Aceh, Papua and Ambon is also excellent, she's indefatigable ... there's no-one who comes close to what she does." The former Australian foreign minister who heads the ICG, Gareth Evans, said he would be happy to answer any complaints from Mr Wirajuda or the head of BIN, General Hendropriyono. "I think the Indonesian Government should take into account that if we are expelled ... this will do far more damage to Indonesia's reputation than ICG's."

Head of IGC says Indonesia threatening to expel her

Agence France Presse - May 27, 2004

The Jakarta-based director of an international analysts' group says Indonesian authorities have threatened to expel her because of her reports on the country.

Sidney Jones of the Brussels-based International Crisis Group (ICG) said "serious accusations" were made against her on Tuesday during a meeting between the National Intelligence Agency (BIN) and a parliamentary security affairs committee.

In a statement she quoted Foreign Minister Hassan Wirayuda as saying Wednesday that ICG's reports were biased and that the government had the right to expel whoever it chose.

Jones said authorities had refused to extend work permits for ICG's foreign staff, based on a complaint which they refused to specify. "How can we answer charges when the charges are made in secret?" She said she had been trying unsuccessfully for two months to meet BIN director Hendropriyono to discuss her group's work.

Foreign ministry spokesman Marty Natalegawa said Wirayuda had not alleged bias but "wondered about the authoritativeness of some of her reports," including those on Aceh. He said the government is not in the business of removing people from the country but added that the foreign ministry has nothing to do with Jones's work permit. "This is a classic case of someone trying to make a martyr of one's self," Natalegawa said. "They are creating a crisis which is non-existent between the Indonesian government and ICG."

ICG's Jakarta office, one of 19 around the world, has produced reports on Aceh, Papua, Maluku, Poso, police and military reform, decentralisation and terrorism.

Yasril Ananta Baharuddin, head of the parliamentary security committee, quoted an intelligence agency report as saying about 20 NGO workers including Jones could "disturb security" during the current presidential election period. Baharuddin, quoted by Kompas newspaper, said his committee encouraged the agency to ban them from the country. "The majority of the commission said that a ban should be imposed on anyone, such as Sidney Jones, who is strongly indicated to have engineered and provoked anti-military activities and cooperated with several NGOs here," he said.

Jones told AFP she believed the ICG's reports on Aceh and Papua, where separatist sentiment is strong, had provoked the expulsion threat. She described it as a worrying development for freedom of expression.

"These kinds of evictions were common in the Suharto period but are much less common now. I fervently hope this expulsion is just a threat and does not turn into reality," she said. "If it does I think it's a throwback to a darker era."

Jones, a US citizen, worked for Human Rights Watch for 14 years, based in New York. She also ran a United Nations human rights programme in East Timor from December 1999 to July 2000. She arrived in Indonesia in May 2002.

ICG president Gareth Evans, a former Australian foreign minister, said in a statement he has total confidence in Jones and the Jakarta team. "I think the Indonesian government should take into account that if we are expelled from Indonesia, this will do far more damage to Indonesia's reputation than ICG's," he said.

Environment

Illegal logging escalating: Police

Jakarta Post - May 28, 2004

Abdul Khalik, Jakarta -- Illegal logging cases investigated by police in the first quarter of 2004 almost doubled compared to the same period of 2003, police said on Thursday.

National Police director of special crimes Brig. Gen. Suharto said his officers investigated 246 cases involving 169 suspects in the first quarter of the year, up from 125 cases involving 80 suspects in the same period of 2003.

According to Suharto, most of the illegal logs were smuggled out of the country, particularly to Malaysia.

"The cases are occurring more frequently this year. We have launched several operations and managed to capture many smugglers. We have also confiscated 100,000 cubic meters of logs, worth Rp 75 million, since January 2004," said Suharto.

He said the police had confiscated 36,500 cubic meters of logs worth around Rp 32 million in the first three months of 2003.

Aside from the logs, they had confiscated heavy equipment worth millions of rupiah, as well as trucks and boats.

Police data shows that East Kalimantan had the highest number of illegal logging cases at 27 cases involving 29 suspects, followed by Central Kalimantan, with 15 cases and 12 suspects. Other provinces, such as South Kalimantan, West Nusa Tenggara and North Sumatra also had a high number of cases.

Suharto said the increase in illegal logging cases showed that police efforts were not enough without support from local agencies, such as customs and excise, forestry, the military and local administrations.

"We apprehend many suspects everyday. But, if the cases keep coming we won't have enough personnel to handle them. I think other agencies should prevent illegal logging from happening in the first place," he said.

Suharto said that on many occasions his officers had seized logs worth billions of rupiah, and handed them over to local agencies so that they could be sold to recover state losses. However, the agencies had not sold the logs.

"The logs could disappear and nobody would take responsibility.

Our hard effort would be a waste of time. We wish that others would follow our example," he said.

Suharto acknowledged the increase in illegal logging was also due to the fact that some police officers were helping the perpetrators.

"We know that several police officers are involved in illegal logging activities, we have taken harsh action against them. We are committed to punishing any police personnel involved in illegal logging -- now, or in the future," he said.

Illegal logging has become a primary concern for both the government and many non-governmental organizations (NGOs) recently. It is claimed that state losses from the illegal activity have reached Rp 30 trillion per year.

The NGOs have said illegal logging causes the deforestation of millions of hectares of land each year.

However, analysts underline that the problem is becoming more complex as the industry, government officials, and others benefit from the practice.

Aid & development

Instability, elections hinder poverty reduction

Jakarta Post - May 28, 2004

Stevie Emilia, Shanghai -- Current instability and the upcoming presidential elections in Indonesia constitute the main hindrance to the national target of halving the poverty rate, economists here said.

On the second day of a World Bank conference on poverty here on Thursday Mohamad Ikhsan of the University of Indonesia raised fears regarding the increase in the number of disadvantaged people including those in conflict areas.

Indonesia is among 189 countries which agreed in 2000 to the Millennium Goals, which include halving the number of people living under the poverty line by 2015.

"Although some areas are rapidly progressing, there are conflict areas such as in Aceh and other areas like East Nusa Tenggara where the number of poor people has increased," the economist said. Special efforts and attention are needed to ensure balanced progress in every area, he added.

Former chief economics minister Saleh Afiff pointed to the ineffectiveness of the Cabinet particularly with ministers resigning to join the country's presidential election in July, with a likely runoff in September.

"We won't even be able to reach the mid-term target because with the election, the Cabinet -- although they are not deliberately putting everything on hold -- don't have the courage to do anything. Even the [former coordinating minister for people's welfare] Jusuf Kalla is campaigning [as running mate to Susilo Bambang Yudhoyono] so it will be very difficult for us to reach the target," he said. "How can we reach the [millennium] goals if there is now a vacuum in our government?" Saleh said.

Mohamad Ikhsan said the country "is not working toward improvement." Low budget is commonly cited as a hindrance to improve maternal health and fighting HIV/AIDS, for instance.

"Some local governments just maintain what they have instead of speeding up the process and allocating more funds. In the end, people who are largely still dependent on government programs are left behind," he said.

World Bank President James D. Wolfensohn said at the closing of the event that while there was no single blueprint to reduce poverty, the conference had revealed that large-scale poverty reduction depended on several key factors. He cited "sustained political commitment and visionary leadership, with continuity over time" and "transparency and accountability to cut corruption".

The conference adopted the Shanghai Agenda for Poverty Reduction which encourages rich countries in particular to intensify assistance to countries that have not benefited from the recent global wave of progress in economic and social development.

Health & education

Economic crisis blamed depression and mental illness

Jakarta Post - May 29, 2004

Yuli Tri Suwarni, Bandung -- The number of people suffering from psychiatric ailments has been on the rise over the past few years in the West Java capital of Bandung, with much of the increase being attributed to the economic hardship that has persisted since the economic crisis hit Indonesia in 1997.

Dr. Machmud, the director of the Bandung Psychiatric Hospital, the only hospital for mentally ill patients in Bandung, said that the hospital had admitted more than 1,000 mentally ill patients each month since January.

In April alone, the hospital registered 1,184 patients suffering from both mild mental disorders such as depression and distress and severe disorders like schizophrenia and paranoia.

He added that there had been a rising trend in the number of mentally ill patients since 2001.

In 2001, at least 9,936 patients were treated at the hospital. This figure increased by nearly 30 percent over two years to 12,473 patients in 2003. "The main trigger right now is economic hardship. After the economic crisis, many companies were shut down so that a lot of people lost their jobs. Losing one's job has been the prime cause of mental depression," he said.

After losing their jobs, at first people may still be able to hang on after being deprived of their livelihoods. Gradually, however, they may not be able to stand the pressure and finally become stressed-out and depressed. Many even attempt suicide, said Machmud recently.

Besides economic problems, he said, the second major problem was domestic disputes between partners and parent-child conflicts.

He said that more than 50 percent of the psychiatric patients in the hospital came from the lower income brackets. Their medical expenses were covered by the government to the tune of more than Rp 1.2 billion (US$140,000) per year.

Machmud disclosed that the increase in the number of people suffering from psychiatric disorders would reduce productivity levels and the life expectancies of people.

"They are inclined to blame others or blame themselves for everything," he said.

He added that the those with psychiatric disorders could also adversely affect people with healthy minds. Based on studies, the life expectancy of a person (a healthy person) was influenced by his surroundings (40 percent), his own behavior (35 percent), access to healthcare (20 percent) and hereditary factors (5 percent).

"If a healthy person lives with another person who is, for example, depressed and always puts the blame on others, he or she will likely start to behave like the first person does. Especially if he or she does not have a strong character," he said.

According to Dr. Machmud, psychiatric problems could not be solved simply by going to the doctor. Other factors, especially an improvement in the economy, would contribute significantly and give more hope to people suffering from depression.

Baby boom looms large for Indonesia

Straits Times - May 29, 2004

Devi Asmarani, Jakarta -- A baby boom is looming large in Indonesia with its much-touted population control programme losing pace due to budget cuts and decreasing foreign aid, following the 1998 fall of the Suharto regime.

Once hailed as one of the world's most successful policies, Indonesia's family planning programme is no longer a priority for a government that has been grappling with other pressing political and economic issues in the past six years.

Officials and population experts are worried that, at the current birth rate of 1.5 per cent a year, the country's 206-million- strong population will reach 249 million in 10 years, with most of the babies being born to poor families.

"Every year, between three and four million babies are born, about the same as the whole population of Singapore," Mr Ispin Husni, the spokesman for the National Family Planning Board (BKKBN), told The Straits Times.

Although the birth rate has been in decline since the start of the family planning programme in 1970, many are concerned over the fact that women from lower economic backgrounds have less access to contraceptives, especially since the economic crisis began in 1997.

A recent demographic and health survey shows that women from poor families on average give birth to three children during their reproductive age, compared to the two children born to middle and high-income families.

Reports have also shown that more women had given birth to unwanted babies. Abortion cases, which are most often not done by medical doctors, soared to about two million a year from about 750,000 a decade ago. Nearly 6,000 women died from the procedure every year.

Free contraceptives for the poor have been in short supply since the country was hit by the economic crisis. The government can only provide 15 per cent of the supply, with the rest provided by foreign donors. But some of these donors have since cut their funding for the country significantly.

Furthermore, unlike the intensive social awareness campaigns done by the Suharto regime, the drive for better reproductive health and the use of contraceptives has nearly ground to a halt because of the lack of funding.

The ubiquitous "Two children, boys or girls" campaign slogan made famous by the Suharto administration had helped send the number of contraceptive users soaring from 500,000 in 1970 to 15 million people in 15 years.

Adding to the problem is the decentralisation of power, which shifted the central government's role in population control policy to regional administrations. "Every region has different sets of priorities; in some regions, population control is hardly an issue," said Mr Ispin.

But officials and experts said the lack of interest among political leaders in acknowledging and addressing population woes has worsened the problems. Many politicians have been reluctant to continue the family planning policy that is seen as a Suharto legacy.

In a speech to a group of Muslim clerics last year, Vice- President Hamzah Haz, who has three wives and 13 children, even called for an end to the family planning programme, saying that 'it is no longer important'.

Said Mr Ispin: "If the policymakers continue to neglect this problem, we will likely experience another baby boom."

International relations

Golkar candidate Wiranto meets US ambassador

Antara - May 27, 2004

Jakarta -- Golkar Party presidential candidate Wiranto met with US ambassador Ralph L Boyce at the latter's residence on Jalan Suropati, Central Jakarta, here on Thursday.

The tete-a-tete lasted about 45 minutes, namely from 6.15 pm to 7 pm. The meeting sparked speculation among newsmen that Wiranto wished to clarify various issues involving himself, including his alleged implication in human rights violations in East Timor in the past.

After the meeting, Wiranto declined to reply when newsmen asked about it. He only said "we talked about current developments, especially in connection with the campaign agenda and presidential election." He said his meeting with Boyce was something other presidential candidates had also done.

Among the topics he had discussed with the US envoy were Indonesia's future problems and relations with the US as well as opportunities the two countries could exploit. "He [Boyce] gave a good response," he said.

Wiranto said Boyce respected the current process of democracy in the country very much. "He expressed his respect for the democracy we are still building ,especially the presidential election," he said.

Regarding his nomination for president by the Golkar Party, Wiranto said "he [Boyces] appreciates what Golkar has done and taken into consideration." "This shows that the process of democracy in Indonesia is recognized by the United States," he said.

Indonesia plans to hold its first-ever direct presidential election on July 5. Wiranto will compete with four other candidates in the election namely incumbent President Megawati Soekarnoputri, incumbent Vice President Hamzah Haz, former coordinating minister of political and security affairs Susilo Bambang Yudhoyono and current chairman of the People's Consultative Assembly Amien Rais.

Wiranto has picked Sholahuddin Wahid, a figure from the country's largest Islamic organization Nahdlatul Ulama, as his running mate. Megawati meanwhile has teamed up with NU chief Hasyim Muzadi and Amien Rais with businessman Siswono Yudhohusodo. Hamzah Haz has taken former minister and military figure Agum Gumelar as his partner and Susilo Bambang Yudhoyono Golkar figure and businessman Yusuf Kalla. Campaigning will start on June 1 and continue until July 1.

A Wiranto election victory will put US in a spot

Straits Times - May 28, 2004

Roger Mitton, Washington -- The possibility that Golkar candidate Wiranto may become the next president of Indonesia is causing concern in the United States. The former Indonesian Army general has been accused of complicity in a notorious massacre of demonstrators in Timor Leste in 1999.

There has been talk of a United Nations indictment against him for human rights abuses. Although the allegations remain unproven, they may cause severe problems in relations between Washington and Jakarta if Mr Wiranto wins the presidential election.

Mr William Liddle, a political science professor at Ohio State University, said: "A Wiranto presidency will make it more difficult for the executive branch of the US government to deal with Indonesia, because there will be constant pressure from Congress and from human rights groups." That pressure could lead to Mr Wiranto being refused permission to enter the United States.

More likely in the short term, the US Congress could tighten the legislative restrictions on military ties with Indonesia that were put in place as a result of the Timor Leste atrocity five years ago.

Mr Larry Niksch, a specialist in Asian Affairs at the US Library of Congress Research Centre, said: "Congress will not look upon a Wiranto presidency with great favour. And one cannot rule out specific legislative action in Congress to impose penalties or sanctions on Indonesia."

But last month, US Ambassador Ralph Boyce said Washington could work with Mr Wiranto. "We can work with anybody that comes out of a free election process," he said. "We're not involved in selecting individual candidates, supporting or opposing individual candidates ... It's the election process that we care deeply about and it seems to be going very well."

Any qualms about Mr Wiranto could be partly ameliorated in US eyes if he were to take steps showing a greater concern for human rights. Some feel he has already started to go down that path by choosing Mr Salahuddin Wahid, a former deputy chairman of Indonesia's human rights commission, as his vice-presidential running mate. Mr Donald Emmerson, an Indonesia expert at Stanford University, California, said: "If Wiranto's Cabinet choices included individuals known as champions of human rights, that too may stimulate some second thoughts on the part of US legislators inclined to punish Indonesia for electing him."

But many feel that what is more likely to stimulate such thoughts and thus neutralise US fears about a Wiranto presidency is his strong stance on security and counter-terrorism. That issue transcends all else in American eyes.

Mr Emmerson said: "Given America's concern with security, including the pursuit and prevention of terrorism in Indonesia, Wiranto's military background and apparent willingness to crack down on Jemaah Islamiah are potential assets to be weighed against his debits on human rights grounds."

But there is also another candidate who is viewed in Washington as having those same valuable assets, but without the negative human rights reputation that bedevils Mr Wiranto. Mr Susilo Bambang Yudhoyono, who propelled his fledgling Democratic Party to major gains in last month's parliamentary elections and who is another retired general, is seen by many in the US as the most desirable candidate. Mr Niksch said: "My guess is that within the Pentagon and the State Department, Bambang Yudhoyono is probably looked at with a fair amount of positive optimism."

Others agree that in Washington, Mr Bambang is widely regarded as a cleaner and firmer candidate than either Mr Wiranto or incumbent President Megawati Sukarnoputri. He is also perceived in the US as being the candidate who could do the most to restore economic growth and maintain public order in Indonesia.

As regards Mrs Megawati, the US views her presidency as having been defined by under-achievement, both domestically and in the fight against violent extremism. "Certainly, for those who wanted a tougher stance on terrorism, she's been a disappointment," Mr Liddle said.

Still, despite privately expressed preferences, officials in Washington have been careful not to publicly extol or disparage any of the candidates. The official US position is that it is up to the Indonesian people to decide who is going to govern them and it is not the place of the United States to pick favourites.

Of course, Washington has vociferously supported Indonesia's democratisation process and its main concern is to see that process continue in the presidential elections.

Naturally, there is a desire that Indonesians elect someone who has the authority to tackle tough problems like reform in the military and pervasive corruption, as well as being a leader who will continue to drive forward political reforms.

Regardless of who is victorious, Washington hopes that Indonesia will be able to readopt a more decisive role in the affairs of the region.

"The US would like to see Indonesia playing the positive, moderate regional and global role that it played under Suharto," said Mr Liddle. "It is hard to see it happening with Wiranto, but it could happen with Susilo Bambang Yudhoyono."

US to support new Indonesian president, Envoy Says

Antara - May 27, 2004

Jakarta -- The United States government will support whoever will be elected as Indonesia's next president, US ambassador to Indonesia Ralph Boyce said after meeting Indonesian President Megawati Soekarnoputri on Wednesday.

"Whoever emerges as the new president of Indonesia through a transparent and fair presidential election, we will support him or her," Boyce said. His country will not question whether the new president has a military or a civilian background, he added.

He pointed out that the US was once led by President Dwight Eisenhower, who had a military background. The envoy said he conveyed to the president his appreciation for the country's recent general election.

"We highly appreciate the process of democratic election in Indonesia," he said, adding that the US will not support any particular presidential candidate or any presidential candidate's campaign team.

Despite expressing his confidence that the July 5 presidential election would not be marked by a riot or security disturbance, Boyce called on the people to remain vigilant of unwanted incidents. "The US is responsible for warning its people in Indonesia to be vigilant in the run-up to the election," he said, referring to travel advisories issued by the US government to its citizens.

Military ties

Australia vetoes some Kopassus officers

Radio Australia - May 25, 2004

Australia says it's refusing to deal with some officers of Indonesia's notorious Kopassus special forces. The Australian military is applying the veto to officers accused of human rights violations while still trying to rebuild links with Kopassus. The Defence Minister says it's a difficult balancing act but in Australia's national interest.

Presenter/Interviewer: Graeme Dobell

Speakers: Senator Robert Hill, Australia's Defence Minister; Ross Cottrill, head of the Australian Institute of International Affairs and a former top defence official

Dobell: Australian special forces troops last trained with the Indonesian red berets in 1997. The training link was cut as violence mounted in East Timor. And Kopassus has since been implicated in other shady actions, including the murder of two Americans and an Indonesian working at the Freeport mine in Papua.

But as part of its anti-terrorism policy, Australia is building up cooperation with Special Forces in Southeast Asia, already conducting joint exercises with the Philippines and Thailand.

And Defence Minister, Robert Hill, says it's in Australia's national interest to resume military cooperation with Kopassus. Hill: We have sought to re-engage Kopassus because we regard it as the principle counter terrorism capability within Indonesia. There are other capabilities that are developing, particularly within the police and we're supporting that as well. But if a very serious incident, such as a hijacking, it may well be more likely then not Kopassus that is brought in.

Dobell: Along with that re-engagement, Australia is also blackballing some of the 5000 officers and men who make up Kopassus becuase of human rights violations.

Senator Hill.

Hill: We have said that we cannot work with those who have committed crimes in the past. This has not made it easy to develop that relationship but we're trying to achieve a win-win situation here. The first that we can work with this organisation where it's necessary to protect Australian lives, but secondly not to send a message that might be confused in relation to basic adherence to basic human values. We haven't proceeded far yet other then through exchanges of senior personnel, meetings between leaders, commanders of the organisations and we are continuing to work down that path and to identify those that we can work with and to gain the confidence of Indonesia in respecting the restrictions that we need to impose.

Dobell: It's an extraordinary military balancing act, seeking cooperation with Indonesia's elite special forces, but also identifying key officers who won't be welcome on joint exercises with Australia. A former top Defence official in Canberra, Ross Cottrill, now head of the Australian Institute of International Affairs, gives this description of how the individual ban would be applied.

Cottrill: "Well one way is to start with designing the exercise that Kopasseus's elements would be involved with, in such a way that it is more appropriate for some parts of Kopassus and less appropriate for others to be involved."

"For example, you could design it so that it was focussed on kind of terrorist capabilities perhaps a hijack of an aircraft or something of that sort and then it would be natural for both sides to select their most suitable forces for that and there could be consultation about how those sources are selected."

Dobell: If Australia has already told Indonesia that some Kopassus officers are not acceptable, how does that impact on the efforts to rebuild the military relationship?

Cottrill: "Any country would be really reluctant to have an exercise partner or a security partner blackballing effectively individual officers, particularly if their senior and thought to have a future. It is much easier to deal with it in functional terms rather than in terms of personalities."

Dobell: Why then is Australia going through the political difficulties of dealing with this organisation which has such a black reputation? Why is it continuing to try to deal with Kopassus when there is that barrier?

Cottrill: "It's a question of bundling. It's because the kind of terrorist capabilities that are of most relevance to co-operation with countries like Australia reside in Kopassus along with capabilities for dealing with urban insurrection or unrest domestically and those things are grouped together and of course we want to be able to co-operate on counter terrorist measures, but we do not really want to be involved with elements with the Indonesian armed forces, it might have an unsavoury record."

Business & investment

Indonesia's oil giant gushes cash, seeks bailout

Asia Times - May 28, 2004

Jakarta -- Indonesia's state-owned oil and gas company, PT Pertamina, is broke and it has asked for a government bailout, as excessive costs have put the company's operating cash flow, and the company's future, in critical condition.

Pertamina's expenditures currently are surpassing its income due to its obligation to meet domestic fuel oil demand with fuel oil bought on the international market at sharply inflated prices, a spokesman said.

"With a liquidity position below 2 trillion rupiah [US$215 million], the company is already bleeding," Pertamina's director of finance, Alfred Rohimone, told a hearing on Tuesday with the House of Representatives' commission on mines and energy.

At the end of April, Pertamina had cash reserves of less than $215 million, but the company's costs for importing crude oil and fuel products exceeded $540 million per month. The company's policy of making cash advance payments to purchase crude oil have also added to its loss of cash flow, Rohimone said.

As a result, the company, which imports some 300,000 barrels of crude oil and fuel products a day at international market prices, is on the brink of running a deficit, and has asked the Indonesian government to help it avert a crisis.

The country's current state budget has allocated some Rp14.5 trillion in fuel subsidies to Pertamina, based on an assumption of oil priced at an average of $22 per barrel. Pertamina should receive subsidy compensation for that entire amount, Alfred said, but in practice, with payments being spread over 12 months, the company only receives 70 percent of the total compensation.

At present, crude oil prices are hovering at a record high of more than $40 per barrel, and the government is scheduled to submit a revision to the 2004 state budget to the House of Representatives as early as July. At that level, according to Pertamina, the fuel subsidy could nearly triple to some Rp40 trillion ($4.35 billion), causing a larger deficit.

Pertamina has already had to spend Rp40 billion to buy crude oil at the price of $35 per barrel, Rohimone said. As a further consequence of the price rise, it has used Rp3.6 trillion of its monthly fee to the government to buy oil, he added.

"Pertamina must cover any shortage in payment with its own funds, Rohimone said. "But under the present unfavorable financial circumstances, the company may no longer be able to do so."

According to Rohimone, the company's current financial condition is largely linked to the previous management's policy of spending a huge amount of money to pay debts. The company had cash reserves of Rp23 trillion ($2.5 billion) in 2001, but said they were depleted through the repayment of government loans.

"The previous management in 2002 spent a lot of money to pay debts on several long-term projects. As a result, we are now broke," Rohimone said.

The lack of operating revenue has forced Pertamina to cancel several projects, and the company said it may liquidate three money-losing subsidiaries as part of its program to improve efficiency.

Pertamina has 14 wholly owned subsidiaries in various business areas including non-oil sectors. But based on an evaluation of the 14 companies, three of the subsidiaries will be liquidated and three others merged into other, better performing companies, Pertamina President Ariffi Nawawi said.

Pertamina also has decided to delay planned exploration activity in Iraq's Western Desert field until the United States has handed over legal and sovereign power to an Iraqi authority.

"We heard that the transfer of power will take place in June 2004. We will wait until this has happened," Pertamina's director of Downstream Industries, Bambang Nugroho, said on the sidelines of the meeting on Tuesday.

Pertamina had planned to begin its exploration activity in the Western Desert field in Iraq in March, but due to increased tensions in Iraq and reports that the US would hand over power to Iraqis, it has decided to postpone the plan's execution.

The company's losses, on top of costs that have exceeded government subsidies, have worsened Pertamina's economic health.

As a result, finance director Rohimone has forwarded several alternatives to the government to help overcome the company's rising deficit. Among them is a request for the government to pay Pertamina its marketing fee on time and to pay Pertamina the fuel oil subsidy compensation funds in advance, based on the actual price and calculations of asset reappraisals.

Rohimone has also asked that the government take over the company's obligation to pay tax and duties on public service operations.

"Short-term measures to cope with the financial crisis in Pertamina would be to release funds from the escrow account, a clear marketing fee [and] on-time payment of subsidy," Rohimone said. "A long-term solution would be improving the structure of the fuel oil price."

In addition, he said the company should review new investment projects, especially those that burden its cash flow.

Excess liquidity put pressure on rupiah

Jakarta Post - May 29, 2004

Dadan Wijaksana, Jakarta -- Aside from global concerns over a possible hike in US interest rates, the rupiah's sharp drop should also be blamed on excess liquidity in the domestic banking sector, which has opened up greater room to speculate against the local unit, according to the central bank.

Bank Indonesia senior deputy governor Anwar Nasution said on Friday the excess liquidity in the banking system was huge, "some of which has been used to speculate against the local unit".

Anwar added that slow progress in corporate restructuring had forced banks to avoid lending to the corporate sector, a condition which in turn creates excess liquidity.

He said that the excess liquidity explained why the rupiah was still under pressure at a time when other currencies in the region had started to bounce back against the US greenback.

"The corporate restructuring in countries such as Malaysia, Thailand and [South] Korea is faster than that of ours. This [slow restructuring] has limited bank lending, and thus caused excess liquidity in the banks," Anwar told reporters, pointing to the slow restructuring of indebted Texmaco Group and Dipasena as examples.

Despite years of efforts, the debt restructuring in the two firms -- which were among companies hit the hardest during the late 1990s financial crisis -- is still no where near completion. Lacking in its lending exposure notably to the corporate sector, the banks then invested their huge funds in non-productive investment such as government bonds, mutual funds and the central bank's promissory notes auctions.

"And now, the banks are also playing in the currency market. That's why BI is reviewing actions to be able to absorb that excess liquidity," Anwar said, without elaborating.

Earlier, Bank Indonesia governor Burhanuddin Abdullah has said that several banks, mostly foreign ones, have taken advantage of the volatility in the local currency market by speculating against the rupiah.

Suspected capital outflows, caused mostly by the widely- anticipated rise in the US rate, took the global currency market by storm as many investors switched their assets in emerging markets back to dollar-based assets.

The rupiah has dropped by around 9 percent against the dollar this year, which makes it the worst performing currency in the Asia region.

Although the dollar has recently started to depreciate against many other currencies amid speculation of a possible delay in the US rate hike, the rupiah kept declining. Dealers said that companies continued to buy dollars on fears that the local unit might further decline. They need the dollar for repaying debts and paying for imported goods.

Statements from the central bank and Minister of Finance Boediono that the dollar in the medium term was likely to weaken because of the US twin deficits problem, seemed to be unable to calm nervous companies.

The rupiah ended on Friday at Rp 9,290 per dollar, unchanged from the closing level on Thursday -- the lowest level in 19 months.

Rupiah continues to fall as other currencies recover

Jakarta Post - May 28, 2004

Dadan Wijaksana, Jakarta -- The rupiah continued to falter on Thursday and ended at a fresh 19-month low, showing no sign of a rebound at a time when other currencies in the region started to regain ground against the US dollar.

The local unit closed at 9,290 per dollar, down from 9,275 the day before -- the weakest since October 14, 2002 -- with dealers pointing fingers in part at local firms building up their dollar stocks to cover debt repayment and the cost of imports.

The companies continued to buy dollars on fears that the local currency could fall further in anticipation of an imminent rise in the US benchmark interest rate -- which should make dollar- dominated assets a more attractive investment.

"So, I guess this is their way of stemming or reducing the losses they have suffered from the rupiah's recent decline," a dealer at a state bank said on Thursday.

Thursday's drop capped the rupiah's shaky showing in recent weeks, while regional peers have managed to recover from US dollar pressure, which recently picked up on optimism about the US economy.

The local unit has so far depreciated by close to 9 percent since January, a loss that exceeds the gain of 7 percent it made last year.

In comparison, on Thursday, the Singapore dollar ended at its highest level for more than two weeks while the Philippine peso also gained. The most impressive showing was probably shown by the Korean won, which closed as its highest level for three weeks.

In addition to external factors, the dealer said the rupiah had also fallen victim to the country's heightened political atmosphere in the run-up to the unprecedented, direct presidential elections.

Indonesia will hold the elections on July 5, with a possible runoff on September 20, should the winner in the first stage of voting fail to secure at least 50 percent of the vote.

Despite all the pressure, Bank Indonesia says it has yet to consider raising its one-month promissory note (SBI) interest rate, provided the US Federal Reserve's interest rate hike was no greater than 0.25 percent.

Analysts have said that, among other things, a rise in SBI rate should help stem rupiah depreciation to draw interest in holding the rupiah. Turning to the stock market, the Jakarta stock index took advantage of gains posted in Asian markets, closing higher for the second day in a row.

The index ended 1.4 percent higher at 728.31 points from the previous day, as a blue-chip share sell-off sparked the market, dealers said.

Cigarette giant Gudang Garam led the 67 gainers on the day after rising by 4.1 percent, or Rp 550, to close at Rp 14,100.

The country's largest and second-largest telecommunications firms -- Telkom and Indosat -- were also among the gainers, up by 2.1 percent and 3.9 percent to close at Rp 7,350 and Rp 4,000 respectively.

Astra International, the nation's largest auto maker, closed at Rp 5,750, 1.8 percent higher than the previous close.

The tale of Indonesia's cement Taj Mahal

Asia Times - May 27, 2004

Bill Guerin, Jakarta -- "It's all over for Cemex, and as far as we're concerned they can go back to Mexico," said Titi Nazif Lubuk, deputy leader of the West Sumatra legislative assembly.

She was speaking on November 1, 2001, the day the local parliament usurped Jakarta's authority by announcing its unilateral takeover of Semen Padang, the local subsidiary of publicly listed Semen Gresik.

The move, described by Titi as an example of "people power" by the coup leaders, a motley crew of provincial politicians, renegade corporate leaders and local Islamic clerics, had posed a significant challenge to the authority of President Megawati Sukarnoputri who then was less than four months into office.

Now, with only six weeks to go until the country's first-ever direct presidential elections and as Jakarta prepares for international litigation, the Padang locals have fired a warning shot across the bows of the five candidates, including Megawati, who are vying for the top spot.

Local public leaders and senior politicians, a local tribal leader and a local newspaper owner, together with the province's Indonesian Youth National Committee, staged a mass rally over the weekend, demanding that Jakarta halt the sale of all state assets, including Semen Padang, to foreign investors.

Titi was in the front line once again, as was the provincial governor, Zainal Bakar, who was widely quoted as saying at the time of the 2001 takeover that Semen Padang is West Sumatra's Taj Mahal, a symbol of local pride that must not be sold to foreigners.

Titi put forth another argument at the time. The fact that the Semen Padang industrial complex, which employs nearly 3,000 people and is the largest single employer in the province, is built on communal lands and customary law prohibits it from being handed over to foreigners, she said.

But many believe the real objective of those behind the unlawful spinoff and the renewed pressure on Jakarta is to keep Semen Padang as their cash cow ready to be milked at will.

The Semen Gresik group, which is based in Surabaya, the provincial capital of East Java, owns 99.99 percent of Semen Padang shares and also owns Semen Tonasa in South Sulawesi.

The government owns 51 percent of Semen Gresik, while the public holds a further 23.46 percent and Monterrey-based cement giant Cemex SA (Cemex) owns the remaining 25.53 percent.

The Washington-based International Center for Settlement of Investment Disputes registered a request for arbitration submitted by Cemex in December.

The long-running controversy dates back to 1995 when the Suharto government allowed Semen Gresik to acquire the Padang and Tonasa subsidiaries in a move hailed as consolidating the three state- owned cement companies into a synergic entity, providing higher efficiency and an increased credit rating, thereby lowering their borrowing costs.

After Suharto's resignation, the desperate need for cash forced the B J Habibie interim administration to sell off a 25.5 percent stake in Semen Gresik in October 1998.

Cemex won a competitive bid at US$1.38 per share and paid $290 million. This was equal to a 127 percent premium on the share price, and the deal earned the Mexicans great kudos as the only major foreign investors to take the plunge in Indonesia during the grimmest months of the regional financial crisis.

The deal made sense for both Cemex, by then the world's third- largest cement producer, and for Jakarta's privatization program and the country as a whole. The sale was the first under privatization and Cemex was given a special "put option" giving it the right to buy another 51 percent stake in the company by the end of 2001.

However, amid threats and intimidation from Padang, Jakarta broke up Gresik's three units two weeks before the three-year conditional sale-and-purchase agreement expired.

If the government caved in, it was argued, other state-owned holding companies, which own and manage airports, seaports and mining units in several provinces, might also face a similar political impasse as renegade local leaders joined the bandwagon and claimed their rights to state assets. Sure enough, by the end of 2001, local legislators in Sulawesi were demanding that the Semen Tonasa plant also be spun off.

There were also fears that other groups in West Sumatra might demand the spinoff of the Ombilin coal unit located in the province from its holding company, publicly listed, government- controlled PT Bukit Asam Coal Co, based in South Sumatra.

Any hopes that the central government would face down the local government of West Sumatra and the implicit regional threat to its authority were wide of the mark. Instead of being resolute and pushing ahead with Gresik's privatization, Jakarta allowed the assets to be taken away without legal grounds.

The government was between a rock and a hard place. If it pressured the main minority shareholders, Cemex, to agree to the split, the screams of "nationalization" would have drowned out the noise coming from the streets of Padang, and would likely have scared off investors in all sectors for a very long time.

Conversely the cash-strapped government could not afford to pay huge amounts of compensation in the event that Cemex called Jakarta's bluff and agreed to a spinoff.

A letter sent in April 2003 by State Minister for State Enterprises Laksamana Sukardi to West Sumatra Governor Zainal Bakar added to the confusion. The letter stated that the central government, as the majority owner of Semen Gresik, understood the aspirations of the West Sumatra people, and therefore approved of their demand for Semen Padang's spinoff from Semen Gresik.

Oddly enough, the letter, described as a "meaningless political goodie" by one analyst, also warned that any decision on the split would be based on the provisions of the Law on Limited Liability Companies and regulations governing publicly listed companies. This meant in essence that government approval was not a legal requirement because Semen Gresik's minority shareholders, who consist of the investing public with 23.5 percent and Cemex with 25.5 percent, would approve any ensuing total separation.

Last September, after months of failed attempts, Semen Gresik was finally able to regain control of Semen Padang, but not before hundreds of troops and police were deployed to escort the new management into the compound. This took place despite a local court ordering the existing management to leave the company.

Their reluctance to leave was explained in part by media reports in Jakarta and Padang that claimed the 2001 coup leaders, who included Semen Padang directors and several legislators and business owners close to the West Sumatra governor, had benefited from supply contracts and other lucrative marketing arrangements with Semen Padang and exporting Semen Padang cement.

As for Semen Gresik, PricewaterhouseCoopers was asked in December to re-audit its accounts, and the Jakarta Stock Exchange has set a deadline of this Friday, May 28, for the group to file its consolidated 2002 and 2003 accounts, or face the risk of share suspension.

Cemex plans to ask the Washington-based arbitration court to rescind the original agreement and order the Indonesian government to pay all related costs and expenses, including compensatory damages

Calls for a spinoff have continued, even after Cemex registered its arbitration claim. Semen Gresik's president, Satrio, warned off the government in February, advising it to postpone the plan to sell more shares to Cemex. "The local people are not in the mood for such a plan, especially during the general election," he said.

The bitter experience in Indonesia, however, has apparently not affected Cemex's outlook on new acquisitions. "We are interested in being in any part of the world," chief executive Lorenzo Zambrano told a shareholders meeting last month. "We continue to study where we can invest."

The negative impact on investor confidence in Indonesia by more international litigation against Jakarta can hardly be overstated but there is also a wider threat implicit in the success of the Padang coup. Foreign ownership of Semen Gresik is a politically divisive issue. After Saturday's rally a petition was issued, signed by senior politicians from the West Sumatra chapters of the Crescent Star Party (PBB), the National Mandate Party (PAN), the New Indonesia Alliance Party (PIB) and the PKPI. Other signatories were the local regent, who also chairs the provincial chapter of the United Development Party (PPP), as well as the local leader of the Prosperous Justice Party (PKS), Mahyeldi Ansharullah.

Sukardi said at a news conference shortly after the Padang locals commandeered the factory in 2001: "This is about the interests of the nation. I hope that the people of Padang can understand that."

He could not have foreseen the split in parliament resulting from no single party holding enough seats to exert its authority, and this division whipping up regional sentiments by appeals to local pride and xenophobia. This state of affairs could have dire consequences for the new government, come this October.

Foreign investors will want to see evidence that central government policy, widely supported in parliament, will win the day and that such prevarication and capitulation to provincial and district governments will not be perpetuated by a new administration.

As for Cemex, it may well be in the mood to cut its losses, pursue the arbitration in Washington, and then get out of Indonesia, as Titi suggested two and a half years ago.