Statement - Indonesia’s Involvement in G-20

8/9/2019 Statement - Indonesias Involvement in G-20

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STATEMENT

Indonesias Involvement in G-20 is not Something to be Proud of;

rather, it Makes the Lives of the Indonesian People Miserable

The G-20 Summit will convene again on June 26-27, 2010 in

Toronto, Canada. Prior to the G-20 Meeting, a Ministerial Meeting

composed of the Finance Ministers and Central Bank Governors of the

member countries of G-20 was held in Busan, South Korea. President

SBY will surely attend the G-20 Meeting and deliver his speech in front of

the leader countries that contribute 85 % the world GDP.

For President SBY, Indonesias involvement in G-20 is something to

be proud of. This is natural, considering the position and strategic role of

G-20 and Indonesia is the only member of G-20 that came from a country

that is considered as a lower-middle income country; it is as if the level ofIndonesia is equal to industrial countries (G8). Many parties also believe

that the participation of Indonesia in the G-20 forum is the biggest

achievement of SBY as the leader of this Republic.

Is it true that the involvement of Indonesia in G-20 something to be

proud of and it is an achievement that can be offered to the Indonesian

people?

Since the inception of G-20 in 1999, the role of Indonesia as a

member country is not really significant, her role is only to approve the

policies formulated by advance countries (G7) and BRIC (Brazil, Russia,

India and China). The honour to speak in the G-20 forum that was

bestowed upon President SBY is just a pseudo-honour because,

apparently, the honour to speak in this forum has a very high price. As a


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member country of G-20, Indonesia should carry the burden of the

financial crisis that is besetting advanced countries at present as a form of

solidarity, despite the fact that the actions and greediness of advanced

countries in exploiting the economy and ecology of poor countries were

never considered as an international crime. In addition to this, the member

countries of G-20, including Indonesia, should also accept the whole

liberalization and privatization agenda of the world economy which is the

primary agenda of G-20 and more advantageous to advanced countries.

The formation of the G-20 Forum in 1999 was actually intended to

respond to the monetary crisis at that time. The crisis has almost become

the main part and characteristic of the capitalist system. Whether we

realized it or not, sooner or later, the exploitative and accumulative

practices in a capitalist system will bring about a crisis and capitalism will

develop from one crisis to another or it create a new crisis (as a

euphemism, Joseph Schumpeter refers to it as constructive destruction).

As a proof, exactly 10 years since the 1998 monetary crisis, theworld economy is once again beset with a crisis. This time, the crisis of

capitalism is triggered by the chaos in the financial market. The products in

the financial market swelled and exceeded the value of the goods and

services produced by the people. Currently, the world GDP is only USD

57.9 trillion (IMF, 2009) while the value of the products in the financial

market is estimated to reach US$ 531 trillion.

At the start, the crisis besieged the financial market of the US in

early 2008. Financial stocks, investment banks and the prestigious

insurance companies in the US became bankrupt. They shattered like the

Twin Towers. This incident forced the US government to conduct large-

scale injection of funds and bail-outs to the financial companies and big

companies in the US. However, like throwing salt in the sea, this action of

the US government did not produce a new economic equilibrium in the


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said country.

Later on, the crisis spread to the centres of capitalism in Europe.

This crisis even made Iceland and Greece bankrupt and it is certain that it

will also spread to the other countries in Europe. In the centre of capitalism

in Asia, Japan and Dubai were first attacked by the financial crisis and

they have not yet recovered up to now. There is also a possibility that the

crisis will also spread to the other countries in Asia, especially the

countries that are already integrated in the global financial system,

including Indonesia.

The economic-political experts in the world are convinced that the

present global crisis is not just a financial crisis. Experts are starting to

provide facts about the threat of a food crisis and ecological crisis (climate

change) that will emerge together with the global financial crisis. Despite

this, the propaganda about the threat of a food crisis and climate change

should also be perceived with caution, considering that there is a tendency

to integrate the method in resolving these two crises into the samepackage to resolve the global financial crisis.

In order to resolve this crisis, advanced countries promoted a global

step that will not only involve advanced countries but developing countries

as well because they are considered as a new and huge economic power.

Basically, this global step will be taken to make developing countries the

safety net of the economies of advanced countries that cannot reduce theircost of living and level of consumption in the midst of the financial crisis

that is besetting these countries. Under the pretence of attaining a new

economic equilibrium, developing countries will become the victims and

the objects of the exploitation of advanced countries.

Based on the initiative of advanced countries that were previously

joined together in G-8, a new forum called G-20 was formed. This forum is


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composed of the member countries of G8 and the developing countries

that have huge contributions to investments and global trade. As such,

India, China, Brazil, Indonesia, and the other developing countries were

allowed to join the industrial countries to gather strength to confront the

crisis.

In this forum, joint strategies are formulated to resolve the global

financial crisis together. There are at least three main pillars in resolving

the global crisis, namely: first, re-strengthen the position, role, and function

of multilateral financial institutions like the IMF and the World Bank as the

financial source to resolve the crisis. Second, re-strengthen global

investments through various ways, including using the issue of climate

change to obtain new investments. Third, re-establish free trade by

abolishing protection policies and prohibiting the opening of markets,

especially in countries with a big population.

The global strategies mentioned above to resolve the crisis are

basically the restoration of the old ways of capitalism. The economic policyoutline used is neo-liberalism that is based on financial liberalization,

broadening of investments, free trade, and foreign debts. This is despite

the fact that in many discourses, these methods were already identified as

the main cause of the crisis.

For Indonesia, her involvement in G-20 without a reserve means

that this country is willing to accept global formulas and its actors, such as,the World Bank, IMF, WTO, and TNCs. As a consequence of the

membership of Indonesia in G-20, Indonesia should implement the whole

economic liberalization agenda that is composed of three things, namely:

first, Indonesia should increase the number of her stocks in multilateral

financial institutions and increase the amount of her foreign debts. Second,

Indonesia should be open for more investments, especially in the service

and financial sector, including investment schemes to confront climate


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change. Third, Indonesia should abolish various trade barriers (protection)

and ensure the implementation of market liberalization in the country.

As a reward, Indonesia will obtain more commitments for foreign

loans, both from bilateral loans and the loans obtained from multilateral

financial institutions. This is in accordance with the interest of the

government of Indonesia as implied in the speech of President SBY in the

G-20 Meeting in Washington DC in 15 November 2008 when he said that

multilateral financial institutions should prepare liquidity, credit, and

facilities to finance trade in order to maintain across borders economic

activities.

Based on the framework (trap) of the G-20 forum, it is certain that

the burden of the global financial crisis will be bestowed to Indonesia. This

is so because, as we all know, the foreign debt of Indonesia is not only a

problem in terms of its increasing nominal value but also because of her

role in changing the political-economic outline of other countries leading to

neo-liberalism. The huge foreign debt of Indonesia that is accompanied bystrict requirements is the reason why Indonesia is continuously chained to

neo-colonial investments and trade liberalization that will make Indonesia

bankrupt. As such, for Indonesia, G20 is not something to be proud of;

rather, it makes the lives of the Indonesian people miserable.

Based on the things mentioned above, we, from Koalisi untuk

Keadilan Global (Coalition for Global Justice) demand the following :1. Reject the ways of neo-liberal capitalism in the form of

financial deregulation, trade liberalization, expansion of

investment, and foreign loans as the strategies in

resolving the global financial crisis.

2. Reject the strengthening of the role of multilateral financial

institutions, such as, the IMF and the World Bank and the

use of foreign loans as a financial source to resolve the


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crisis, especially in developing countries.

3. Reject all forms of manipulations towards the issue of food

crisis, climate change, and the agenda of sustainable

development that is actually an effort to prolong neo-

liberalism and imperialism in third world countries.

4. Demand the government to re-implement the national

economy based on the mandate of the Proclamation of

Independence and the 1945 Constitution, particularly

article 33, as the basis of the peoples economy.

Such are our demands

Jakarta, 25 June 2010

Members of the Coalition

1. IGJ (Institute Global Justice)

2. INFID (International NGO Forum on Indonesian Development)

3. KAU (Koalisi Anti Utang)

4. WALHI (Wahana Lingkungan Hidup Indonesia)

5. Migrant CARE

6. KRUHA (Koalisi Rakyat Untuk Hak atas Air)

7. SPI (Serikat Petani Indonesia)

8. KIARA (Koalisi Rakyat Untuk Keadilan Perikanan)

Documents

Statement - Indonesia’s Involvement in G-20