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VAN ZORGE

REPORTON INDONESIA

C O M M E N T A R Y & A N A L Y S I S O N I N D O N E S I A N P O L I T I C S A N D E C O N O M I C S

VOL. II, NO. 18 — 1 NOVEMBER 2000

INSIDE ISSUE II/18: FROM THE EDITOR ......................................................................................... 3IRIAN JAYA .............................................................................................. 4

A Province At The Crossroads: Irian Jaya or Papua?The recent tragedy in Wamena, a town situated in the hinterland of Irian Jaya, has refocused attention on theremote and restive province. This outbreak of violence, in which over 30 people were killed and dozens injured,was triggered when a group of Brimob police removed one of the separatist ‘Morning Star’ flags that were flyingin the town. However, most of those killed were transmigrants. This event, together with the subsequent shift instance towards the separatist movement, signals a definite change in both the tactics and policy being used by thecentral government. This change is of immense importance, as it provides insight into the current power struggleamong the political elite in Jakarta and could have the most profound implications for the government’s attitudetowards other provinces with secessionist tendencies. It could also have major implications for Indonesia’s foreignpolicy.

INTERVIEW WITH A.M. FATWA ....................................................................... 18“Many Foreign Powers Do Not Want Indonesia To Be Strong.”

INTERVIEW WITH YORRYS RAWEYAI ................................................................... 19

“Maybe The Output Could Be: One Nation, Two Systems.”VZH LEADERS’ GETAWAY, SPEECH BY ADAM SCHWARZ ................................................ 21

“Indonesia’s Political Transition: Forwards or Backwards?”REGIONAL AUTONOMY ................................................................................... 25

Indonesia’s Progress Towards Fiscal DecentralisationWith the 1 January 2001 deadline for the implementation of decentralisation fast approaching, more informa-tion is now becoming available from the government. While there seems to be general agreement that many issueswill not be decided in time to meet the deadline, the government is nonetheless making steady progress with someof the technical details required, while leaving bigger decisions for later. We take a look at the latest developmentsin this critical area of government policy, and the risks and concerns that remain.

POLITICAL/ECONOMIC BRIEFS .......................................................................... 32

VAN ZORGE REPORT — 1 NOVEMBER 2000

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VZR is a bi-weeklyreport specialising in the

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Looking back over the political crisis thathas engulfed Indonesia for the past three years, one must wonder: Aren’t there

any capable leaders who can extricate thecountry from its state of overwhelming un-certainty? The current cast of political fig-ures, which includes President AbdurrahmanWahid, Vice-President MegawatiSoekarnoputri, MPR Chairman Amien Rais,and DPR Speaker Akbar Tandjung, has failedthe litmus test of leadership—the ability tobuild a national consensus. Each of thesepoliticians has, unfortunately, displayed a lackof direction and purpose in their respectiveoffices. Instead of pulling together for the sakeof trying to solve the country’s problems, theyhave become increasingly polarised. Persis-tent backstabbing and finger-pointing amongthe elite has exacerbated the climate of un-certainty, further eroding confidence in In-donesia as a place to do business.

More recently, the foreign investment com-munity has been fretting over the continuingbattle between the president and his politicalopponents. Slightly more than one year inoffice, Wahid has been besieged with chargesof corruption and incompetence. Incessanttalk by Amien Rais and, at times, even AkbarTandjung about the possibility of impeachingWahid rose to a high level pitch before August’sMPR session. Having failed, there are nowrenewed attempts within Rais’ camp to builda wider consensus that Wahid should beousted. Rais is arguing that if Wahid is notremoved from office, there is a risk of na-tional disintegration. Joining hands in this newchorus is the noted Indonesian economist,Sjahrir, who recently made statements to theeffect that Wahid is undoubtedly corrupt andmust resign.

It is ironic that, in the wake of the failed pros-ecution of former President Soeharto andquestion marks over whether his son, Tommy,will actually serve his sentence of 18-monthsentence for corruption, the nation’s politi-cians and self-appointed pundits areclamouring for Wahid’s demise. ThatSoeharto and his family were corrupt therecan be no doubt, whereas any wrongdoing byWahid has yet to be proven by state investiga-tors. Here, the blame for continued failure in

A Crisis of Leadershipthe Soeharto family trials must be laid at thedoorstep of a compromised judiciary, which hasneither the will nor the moral fortitude to incar-cerate the nation’s most notorious criminals. Evenmore ironic is the fact that Wahid’s detractorstoday were among the more vocal in their criti-cism of Soeharto during the latter’s years inpower, and now remain stunningly silent asSoeharto and friends remain beyond the reachof justice.

Bemoaning the fact that Wahid has yet to makesignificant progress on complex problems suchas secessionism and economic reform also missesthe mark. Pressures for secessionism are the back-lash of over three decades of brute suppressionand exploitation of the richer outer provinces bythe Soeharto regime and its military command-ers. The tremendous challenges posed by eco-nomic reforms, in particular corporate and bankrestructurings, are the costs of Soeharto’s egre-gious style of crony capitalism. These legacies ofthe Soeharto era, and many others, are the in-heritance of President Wahid and they will re-main daunting challenges for his successors inthe future, as well.

This is not to argue that Wahid does not haveglaring deficiencies. His incorrigible appetite forintrigue, perplexing tactical manoeuvres, and anopaque style of decision-making evoke exaspera-tion and confusion at the same time, which ishardly the ideal management model for a nationmired in crisis. Wahid perhaps recognises hisshortcomings, and has taken the right step inassigning a capable spokesman but, until now, itseems that the president is unable to resist thetemptation of reverting to form and taking thepodium.

So the question remains: Given the poor profileof today’s political figures and a maelstrom of cri-ses facing the nation, how could one ever be opti-mistic about Indonesia’s being able to turn thecorner and instill greater confidence about its fu-ture? The answer lies obviously not in undermin-ing the incumbent and therefore creating evenmore uncertainty. Solutions are not to be foundsimply by engineering Wahid’s removal from of-fice. Rather, a change in Indonesia’s fortunes willrequire a higher and nobler sense of purpose byIndonesia’s political elite, which in the final analy-sis will demand a show of true leadership.r


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IRIAN JAYA

A Province At The Crossroads: Irian Jaya or Papua?

THE SITUATION IN IRIAN JAYA IS UNIQUE,WITH CULTURES UNCHANGED FOR 30,000YEARS COLLIDING WITH MODERNITY.

NATIVE PAPUANS FEEL LITTLE AFFINITY FOR

INDONESIA, HAVING FEW ETHNIC, CULTURAL

OR RELIGIOUS SIMILARITIES.

SECESSIONIST SENTIMENTS STEM FROM AVARIETY OF FACTORS.

THE DUTCH RETAINED CONTROL AFTER

INDONESIAN INDEPENDENCE IN 1947.

The recent tragedy in Wamena, a town situated in the hinterland of Irian Jaya, has refocused attention on the remoteand restive province. This outbreak of violence, in which over 30 people were killed and dozens injured, was triggeredwhen a group of Brimob police removed one of the separatist ‘Morning Star’ flags that were flying in the town.

However, most of those killed were transmigrants. This event, together with the subsequent shift in stance towards the separatistmovement, signals a definite change in both the tactics and policy being used by the central government. This change is ofimmense importance, as it provides insight into the current power struggle among the political elite in Jakarta and could havethe most profound implications for the government’s attitude towards other provinces with secessionist tendencies. It could alsohave major implications for Indonesia’s foreign policy.

In order to understand this change and where it could lead, it is first necessary to examine the push for independence in IrianJaya in greater detail. We then go on to look at what the implications of the new policy could be, and the directions in whichthis could take the province.

Political OverviewCharacterised by a rapid and drastic transformation of society, the socio-po-litical environment of Irian Jaya is quite unique. Within the space of one ortwo generations, indigenous tribal cultures that had remained unchanged for30,000 years have suddenly collided with the 20th century. These culturesfind themselves struggling to come to terms with a modern society in whichindustrial activities are replacing traditional means of seeking a livelihood.With the pressures of cultural transformation and, as a result, of perceivedinjustices suffered at the hands of the central government, the military andPT Freeport Indonesia, the Papuan independence movement has gained stronggrassroots support among the native population of the province.

For many native Papuans, the independence movement has become a meansof expressing their frustrations and anger towards government policies, whichthey feel deny them their basic human dignity, violate their human rights,and irreparably damage their traditional lifestyles. Through the movement,the Papuan people are seeking an affirmation of their unique identity andhistory and, perhaps most importantly, their dignity; all of which they feelhave been suppressed under Indonesian rule. In general, native Papuans feellittle affinity with other Indonesians, particularly the dominant Javanese, withwhom they share few ethnic, cultural, or religious similarities.

Root Causes of Secessionist SentimentThe secessionist sentiments of native Papuans are the result of a combinationof cultural and historic factors. These include rapid cultural change, manyyears of poor governance, the recent precedent set by East Timor and a gen-eral desire for self-determination. In addition, there are strong indicationsthat opportunists and organised criminal elements are fermenting and ex-ploiting the independence movement for their own ends.

Historical Basis: The Dutch presence, in what was then known as WesternNew Guinea, was tenuous at best prior to Indonesian independence in 1947,at which time the vast majority of the interior of the island remained unex-plored. When the UN recognised Indonesian independence in 1947, theDutch retained control over Western New Guinea, despite claims to sover-eignty from the fledgling republican government to the west. With this their


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only remaining colonial possession in the region, the Dutch actively encour-aged and prepared the territory for self-government. Having already lost theirother possessions, the Dutch were loathe to see Western New Guinea also fallunder Jakarta’s control.

In October 1961, for the first time the Dutch installed a local parliamentknown as the Volksrat. Shortly afterwards, a group of native Papuans convenedwhat they described as the First Papuan National Congress, which subse-quently declared the Dutch possession an independent state on 1 December1961. It was at this congress that the bintang kejora, or ‘Morning Star’ flag asit is known internationally, was first adopted as the symbol of a free Papuannation.

Despite Jakarta’s ambitions, the under-equipped Indonesian military wasunable to challenge Dutch control until 1962. As part of Soekarno’s konfrontasipolicy, Indonesian forces attempted to infiltrate the territory with over 2,000soldiers. However, they met with little success, primarily because the Papuapopulation failed to welcome them as liberators. While Soekarno had boastedthat Papuans kept Indonesian flags hidden under their beds, more often thannot the Indonesians were attacked or captured, and handed over to the Dutchauthorities. Subsequently, manipulating cold war tensions, President Soekarnothreatened the Dutch colony—which he relabeled West Irian—with a soviet-built air force in an attempt to distract public attention at home away froman ailing economy.

Finally, in the face of mounting Indonesian threats and, more importantly,under considerable diplomatic pressure from the US, the Dutch governmentreluctantly transferred its authority over Western New Guinea to the UN in1962, on the condition that the Papuans were given the opportunity to voteon their future. The UN eventually acquiesced to an Indonesian proposal toconduct a poll among 1,000 handpicked tribal leaders in 1969 in what laterbecame known as the Act of Free Choice.

The validity of this Act of Free Choice is still hotly debated in Irian Jaya.Because local conditions precluded a popular referendum, Indonesian offi-cials argued that the best option was to convene a congress of more than1,000 prominent native Papuan leaders to determine the territory’s future.By contrast, the UN favoured a mixed system, with the balloting of registeredvoters in the cities and appointed tribal leaders for the hinterlands. However,at the height of the cold war, western nations had no desire to upset Soekarnoover the issue of a sparsely populated island inhabited solely by ‘primitivetribes.’ As a result, in an episode that the UN does not look back on as itsfinest hour, the Indonesians got their way.

In the event, far fewer than 1,000 individuals actually participated in the Actof Free Choice, and there are plausible claims that the Soekarno governmentused bribery and coercion to ensure a vote for integration with Indonesia.The UN, eager to appease Soekarno and divest itself of responsibility for theformer colony, accepted the result of the poll and recognised West Irian, as iswas known at that time to the Indonesians, as an integral part of the Indone-sian republic. In August 1969, Indonesia officially took over control of theterritory, and renamed it Irian Jaya. However, many pro-independence Papuans

THE FIRST PAPUAN NATIONAL CONGRESS

MET IN 1961 AND DECLARED PAPUA AN

INDEPENDENT STATE.

INDONESIA STARTED TO THREATEN TO TAKE

CONTROL OF THE COLONY IN 1962.UNDER INTENSE DIPLOMATIC PRESSURE

FROM THE US, THE DUTCH FINALLY

AGREED TO PASS CONTROL TO THE UN.

THE UN AGREED TO AN INDONESIAN

PROPOSAL TO CONVENE A CONGRESS OF

1,000 TO DECIDE THE COLONY’S FATE,LATER CALLED THE ACT OF FREE CHOICE.

MANY PAPUANS DISPUTE THE VALIDITY

AND FAIRNESS OF THE ACT OF FREE

CHOICE. THERE IS EVIDENCE THAT

INDONESIA USED COERCION AND BRIBERY.NEVERTHELESS, THE TERRITORY OFFICIALLY

BECAME PART OF INDONESIA IN 1969 AND

WAS RENAMED IRIAN JAYA.


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MOST INDONESIANS DISAGREE WITH THOSE

WHO DISPUTE THE ACT AND ARGUE THAT

IRIAN JAYA SHOULD HAVE BEEN

INCORPORATED INTO NEWLY INDEPENDENT

INDONESIA IN 1947.

THE ARRIVAL OF MODERN INDUSTRY AND

AN INFLUX OF TRANSMIGRANTS HAVE PUT

INDIGENOUS TRIBES UNDER GREAT STRAIN.

MANY PAPUANS FEEL THEY HAVE BEEN

ECONOMICALLY EXPLOITED AND THAT THEY

ARE THE VICTIMS OF RACISM.

THE PAPUANS HAVE SUFFERED THEIR

SHARE OF HUMAN RIGHTS ABUSES FROM

THE MILITARY AND THEY FEEL THAT THE

LEGAL SYSTEM CONTINUES TO WORK

AGAINST THEM.

PAPUANS ALSO FEEL THEY HAVE NOT

BENEFITED SUFFICIENTLY FROM FREEPORT’SOPERATIONS.

continue to reject the legitimacy of this decision. Given the undemocraticprocess and the dubious circumstances surrounding the Act of Free Choice,their position is not entirely without basis.

Conversely, some Indonesian nationalists argue that there was no justificationfor conducting the Act of Free Choice in the first place. They argue thatbecause of Irian Jaya’s shared colonial heritage and language with the rest ofIndonesia, the international community should have recognised it as an inte-gral part of Indonesia in 1947. These opposing views regarding the Act ofFree Choice are difficult to reconcile, with each side believing that its ownposition is morally justified.

Cultural Shock: Irian Jaya is characterised by an extraordinarily complex in-terplay of traditional cultures, most of which are under enormous strain as aresult of attempts to come to terms with the industrial age. Until the middleof the twentieth century, the bulk of Irian Jaya’s native population used stone-age implements and lived in isolation from the outside world. For many na-tive Papuans, a 30,000 year-old pattern of existence changed suddenly, withinthe space of one generation, with the arrival of Indonesian influence in 1962and the subsequent development of modern industry together with an influxof transmigrants from other more overcrowded parts of the archipelago. How-ever, the state apparatus of Soeharto’s New Order regime was ill-equipped tofacilitate this cultural transformation, and New Order officials were probablydisinclined even to try. Consequently, a major cultural collision ensued, andPapuan society remains in deep cultural shock. The recent calls for politicalindependence are just one symptom of this.

Perceived Injustices: For many native Papuans, the independence movementis a means for expressing anger at the perceived injustices of the central gov-ernment, the military and PT Freeport Indonesia. These perceived injusticesrelate to the overall disruption to traditional life, as well as a feeling thatgovernment policies have resulted in a failure to treat ethnic Papuans withbasic human dignity. Under Indonesian rule, many ethnic Papuans feel thatthey are the victims of racism.

Human Rights Violations: The Indonesian army has a poor track record inIrian Jaya, and has been accused of numerous instances of human rights abuses.The sense of injustice has been exacerbated by a lack of legal recourse forPapuan victims of human rights abuses, due to the influence of the militaryover the courts, and by a feeling that the legal system is inherently biasedagainst native Papuan interests. This feeling was reinforced shortly after therecent Second Papuan National Congress: While military officers remain al-most entirely above the law, the legal system promptly instigated investiga-tions into allegations of treason by some of the delegates attending the con-gress.

Perceived Inequities: With the boomtown atmosphere surrounding PTFreeport Indonesia’s massive mining operations, severe social jealousies haveemerged. There is a widely held belief that Irian Jaya’s mineral wealth is beingunfairly exploited and that native Papuans have failed to benefit from themine’s operations. This belief is visceral and held by the vast majority of


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AGGRAVATED BY THE TRANSMIGRANT

PROGRAMME, PAPUANS’ TRADITIONAL LAND

RIGHTS HAVE NOT BEEN RESPECTED.

THE PROVINCE HAS BEEN POORLY

GOVERNED AND SUFFERED AT THE HANDS

OF CORRUPT PUBLIC OFFICIALS.

ON TOP OF THEIR OTHER COMPLAINTS,PAPUANS FEEL NO AFFINITY FOR

INDONESIANS.

THE EAST TIMOR PRECEDENT HAS BEEN AFACTOR IN INCREASING THE EXPECTATIONS

OF THE PAPUANS.

LOCAL THUGS AND RACKETEERS, WHO HAVE

PROSPERED IN RECENT YEARS, AND ARE

USING THE SEPARATIST ISSUE TO THEIR

ADVANTAGE.

THIS INVOLVEMENT BY MORE UNDESIRABLE

ELEMENTS COULD CREATE A VICIOUS CYCLE.

native Papuans, not merely the Papuan elite. Ironically, it is worth pointingout that most Indonesians feel that Indonesia has been cheated by PT FreeportIndonesia.

Violations Of Land Rights: Complaints that traditional Papuan land rights(ulayat) have been violated by government transmigration programmes andcommercial logging activities are common. Unfortunately, the norms of tra-ditional land rights and of the traditional use of resources clash sharply withcommercial practices, at least in an Indonesian context. While this is a prob-lem over the entire archipelago, it is particularly acute in Irian Jaya.

Poor Governance: More sophisticated native Papuans take issue with themanner in which the New Order government administered the province. Acommon complaint relates to the highly centralised civil bureaucracy anddecision-making process. More than three decades of domination by a Jakarta-based bureaucracy have generated deep resentment in a large number ofIndonesia’s regions, not just Irian Jaya. Widespread, brazen corruption on thepart of public officials has exacerbated this resentment.

Desire for Self-Determination: Apart from the resentment against the centralgovernment due to the factors stated above, there is also a genuine desire forself-determination among native Papuans. This desire is based upon a percep-tion that indigenous Papuans share a common history and culture that arequite distinct from other Indonesians. Many Papuans lack a sense of affinitywith other Indonesians, particularly the dominant Javanese, with whom theyshare few ethnic, cultural or religious characteristics.

The East Timor Precedent: Support for the ethnic Papuan independencemovement received a boost, albeit a transient one, after the independence ofEast Timor. In late 1999, there were widespread expectations among Papuansthat the UN, the US and Australia would somehow liberate the provincefrom Jakarta within a matter of weeks. These false hopes have since dissipated.

Opportunists: Opportunists with vested interests have also come to the sup-port of the native Papuan independence movement. As in the new states emerg-ing as a result of decentralisation elsewhere in the world (such as in the formerSoviet republics), local thugs and racketeers have emerged as powerful fig-ures. For such individuals, the independence movement provides a means ofachieving greater power and wealth while simultaneously fending off threatsto their interests resulting from democracy and the rule of law. By insulatingIrian Jaya from Jakarta, independence—or failing that, special autonomy—promises to provide these individuals with a means of preserving Soeharto-erabusiness arrangements and to prevent the process of political reform fromshedding light on their shady dealings.

With their ability to manipulate and exacerbate the various causes of discon-tent mentioned above, opportunists play a particularly important role. Thereis the potential for a vicious cycle in which the process of political reformthreatens the position of gangsters, gangsters provoke popular dissent, popu-lar dissent strengthens the independence movement, and the movement pre-sents greater demands for political reform.


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THE FREEDOM OF EXPRESSION SINCE

SOEHARTO’S RESIGNATION HAS ALSO

EMBOLDENED THE SEPARATIST CAUSE.

THE JUSTIFICATION FOR SECESSION ISWEAKER THAN EAST TIMOR, BUT STILL

CANNOT BE IGNORED.

DEMANDS FOR EAST TIMOR’SINDEPENDENCE WERE COMPELLING AND

SUPPORTED BY THE UN TOGETHER WITH

MOST OF THE INTERNATIONAL COMMUNITY.

WHILE LESS CLEAR CUT THAN EAST

TIMOR, IRIAN JAYA HAS THE STRONGEST

CASE AMONG THE INDONESIAN PROVINCES

CURRENTLY SEEKING SECESSION.

IRIAN JAYA IS TOO IMPORTANT TO LOSE,AND WOULD ALSO SET A PRECEDENT

LEADING TO DISINTEGRATION.

PREVIOUS ARMED INSURRECTION WAS PUT

DOWN WITH RELATIVE EASE BY THE

INDONESIA ARMED FORCES.

Press Liberalisation: Finally, the seemingly sharp increase in calls for inde-pendence could be, to some extent at least, a function of the liberalisation ofSoeharto-era controls on public discourse. Thanks to political reform andliberalisation, opinions can be voiced and heard with far greater freedom nowthan in the past. Thus, the apparent increase in secessionist sentiment maybe partly the result of latent sentiments suddenly becoming public after along period of suppression.

Justification for SecessionThe strength or otherwise of the rationale for secession is a vital factor inassessing the level of support the independence movement can generate, bothdomestically and within the international community. Indonesian unity istypically justified in terms of a common national language and a shared colo-nial history. On this basis, the justification for the Papuan independencemovement is far weaker than in the case of East Timor, albeit somewhat stron-ger than in the case of Aceh.

Other Provinces: East Timor had compelling grounds for its demands forindependenc e. Apart from the fact that Indonesia acquired the territory byforce, East Timor had previously been governed by the Portuguese, and theprovince had little sense of shared history with Indonesia, virtually all of whichwas ruled by the Dutch colonial government prior to independence. In addi-tion, at the time of East Timor’s integration, the use of the Indonesian lan-guage was extremely limited. Crucially, the UN never recognised Indonesiajurisdiction over the territory.

In contrast to Irian Jaya, the rationale for the secession of provinces such asRiau and East Kalimantan is weak. These provinces were always an integralpart of the Dutch East Indies, to a large degree the provinces share similarreligious beliefs and the Indonesian language is widely spoken throughout.Aceh, which never fully succumbed to Dutch rule and was ruled by a thriv-ing, independent sultanate until the 17th century, has a slightly stronger ra-tionale for succession than Irian Jaya. In recognition of these facts, Indonesia’sfounding fathers granted Aceh the status of ‘special region,’ (although in prac-tice, this has meant little).

Status of the Independence Movement Since the Fall of SoehartoThe increased strength of the independence movement in recent times islargely the result of the transformation of Indonesia’s political system fromauthoritarianism towards democracy. However, notwithstanding the upheav-als in the Indonesian political system, the Indonesian president, his cabinet,parliament, and the military are all united in their determination to preventPapuan independence. The province is simply too large and too valuable forIndonesia to lose. Furthermore, there is a strong perception that the prece-dent set by the loss of Irian Jaya would spell the start of an unraveling of theterritorial integrity of Indonesia, encouraging separatist sentiment in otherprovinces.

Armed Papuan insurrection is unlikely to ever present a real threat to theIndonesian military, given the sheer size of the province and the geographic,physical and cultural barriers that divide its population. While guerillaoffensives launched by the Organisasi Papua Merdeka (Free Papua

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BUT THE NEW ERA HAS CREATED GREATER

UNDERSTANDING AMONG PAPUANS OF

THEIR COMMON CAUSE.

PAPUANS WERE DISAPPOINTED BY THE

LOCAL RESULTS OF THE GENERAL ELECTION.BUT THE REFERENDUM RESULT IN EAST

TIMOR ENCOURAGED THEM.

THE ELECTION OF ABDURRAHMAN WAHID

TO THE PRESIDENCY GAVE A BOOST TO THE

PAPUAN CAUSE.

Organisation) once justified the classification of Papua as an area of militaryoperations by the central government, the rebels were largely ineffective againstthe superior numbers and might of the Indonesian military due to a lack ofeffective leadership, and poor training and equipment. Although the FreePapua Organisation is believed to remain in existence, its numbers are prob-ably tiny, with most of its surviving members from its active period are nowin their 50s and 60s.

Spurred on by the calls for reformasi during the Habibie administration, theindependence movement in Irian Jaya started to gain strength once again in1998. A group of native Papuans known as Team 100 visited then PresidentHabibie with the intent of pressing the case for greater autonomy. Team 100included many of the eventual senior members of the Papuan Presidium,together with many moderates who wanted to address the grievances of thePapuan people within the context of a unitary state. The report that theypresented to Habibie contained many of the points that became the basis ofthe demands of the Second Papuan National Congress held in June 2000.

The general election in June 1999 had predictable results, with Golkar re-ceiving the greatest number of votes, followed by PDI-P and a host of smallerparties including PDI. Reflecting the arbitrary allocation of seats to prospec-tive delegates under the Indonesian electoral system, the majority of the del-egates elected were not native Papuans. This is because delegates are selectedby their respective parties, and not chosen directly by the electorate. In addi-tion, there were allegations of electoral fraud but, given the lack of electionobservers and the small number of voters relative to the general Indonesianpopulation, these were generally overlooked in the euphoria of the first freeand fair elections in most people’s living memory. The DPRD vote was simi-lar to that of the DPR, ensuring a generally conservative (pro-Jakarta) re-gional parliament. While this may have come as a disappointment to theseparatists, the referendum in East Timor, which followed three months later,served to embolden them and add momentum to the drive for independence.

Javanese Provinces With Secessionist SentimentCharacteristic Riau Aceh Irian Jaya East Timor

Lingua Franca n n p rColonial History n p p rRace n n r rReligion n n r rCulture r r r r

Shared: n Shared to Some Extent: p Not Shared: r

Comparison of Indonesia’s Regional Differences

The election of Abdurrahman Wahid as president gave native Papuans furtherhope that the old policies of the New Order would soon end. In many ways,Wahid was the perfect choice for the Papuans: A widely respected Islamicleader with strong secular tendencies, he had the ability to listen and seemedthe type of person who could address the grievances of the Papuan people.


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Indeed, President Wahid initially provided a strong vision for the Papuans,and was undoubtedly sincere in his overtures. He seemed to understand thatthe greatest desire of the Papuans was to be treated as equals with respect. Inhis speech to the Papuan people, delivered on the eve of the new millennium,he made a number of statements that resonated well with those in the audi-ence. He stated that the name of the province would change from Irian Jayato Papua, and he personally guaranteed the Papuans’ right to freedom andtheir freedom of speech. He also indicated his willingness to conduct a dia-logue with them and address the wrongs of the past. He went on to indicatethat freedom could be discussed as a concept in a democratic nation. Thispoint was to provide the greatest amount of momentum for the indepen-dence movement. For the first time, Papuans could freely express their aspira-tions without fear of reprisal. He also warned that he was responsible formaintaining the territorial integrity of Indonesia, but that this would notpreclude him from maintaining an open dialogue.

This vision, if followed to its logical conclusion, could have served as the basisfor finding a solution to the problems of the Papuan people. However, thevision eventually encountered two problems. The first was that the presidentgot out too far ahead of his cabinet in Jakarta, as well as parliament. This wasalso at a time when his critics were becoming increasingly vocal, and parlia-ment was turning against him. Without the support of his cabinet at the veryleast, he would be unable to implement his vision.

The second problem was that in many ways, the president’s vision created adeliberate misunderstanding. For a people who had been subject to the worstexcesses of the New Order, the distinction between discussing freedom on atheoretical basis and implementing it in fact may have been too fine. Fromthe vantage of the Jakarta elite and a military still smarting from the loss ofEast Timor, it looked as though the new president was going down a paththat would result in exactly the same outcome in Irian Jaya. This ultimatelyset President Wahid on a collision course with the vested interests in Jakarta,the impact of which is only now being played out.

Recent DevelopmentsThe probability of violent conflict has undoubtedly increased in recent weeks.The central government in Jakarta has been sending signals that indicate anew get-tough policy towards anyone advocating independence for the prov-ince. The most telling example of this can be seen in the policy shift towardsthe flying of the bintang kejora flag, the ‘Morning Star’, in the province.Previously, President Wahid had indicated that the flag would be permittedto fly as long as it was flown alongside the Indonesian national flag, and wassmaller and lower.

Despite the president’s original acceptance of the flag, Marsilam Simanjuntak,the cabinet secretary, announced on 12 October, that the flag would bebanned, along with all other items displaying its image, such as T-shirts, bagsand caps. He also stated that the Papuan taskforce, known at Satgas Papua,would be ordered to disband.

WHILE MAINTAINING THAT IRIAN JAYA

SHOULD REMAIN PART OF INDONESIA,WAHID ENCOURAGED AN OPEN DIALOGUE

WITH THE PAPUANS.

WAHID’S VISION RAN INTO TWO PROBLEMS.FIRST, HE WAS TOO FAR AHEAD OF BOTH

HIS CABINET AND PARLIAMENT.

ALSO, A MISUNDERSTANDING STARTED TO

OCCUR, AND PAPUANS FAILED TO

UNDERSTAND THAT WHAT WAS ON OFFER

WAS NOT INDEPENDENCE.

NOW THE GOVERNMENT HAS REALISED

WHERE THINGS ARE LEADING, AND HAS

DECIDED TO TAKE A HARDER LINE,STARTING WITH THE SEPARATIST FLAG.

THE FLAG WILL BE BANNED AND THE

PAPUAN TASKFORCE DISBANDED.

11


Local police in Jayapura set a deadline of midnight on 19 October for the flagto be lowered in Jayapura, with additional deadlines to follow for other citiesstill flying the flag. It is interesting to note that this announcement was madeby the Superintendent for Jayapura, not the Kapolda Brig Gen S.Y. Wenas,provincial chief of police for Irian Jaya. Wenas was transferred from his post asKapolda to National Operations Director for Patrols, a position which hecharacterised as a lateral move. In an interview in Jayapura with the Van ZorgeReport on 18 October, Brig Gen Wenas indicated that he had received strongpressure from Jakarta to take a harder line with the separatists. However, healso indicated that he felt the officials in Jakarta did not understand the situ-ation in Irian Jaya, and that it was his job to keep the peace. He also statedthat it was not worth shedding blood “over a piece of cloth.” While his reap-pointment was part of a larger police reshuffle, questions remain as to why hewas transferred, given that he has only been in the position for one year andwas considered by most Papuans to have been one of the best Kapoldas theyhad ever had. As such, his transfer could be seen as a further indication that aharder line will be taken in the province in the future.

This change in government policy came in the wake of the tragic Wamenaincident. But the Wamena incident itself also begs the question: Why was theWamena flag was pulled down in the first place? The answer is complex, andhas perhaps less to do with events in Irian Jaya than with the continuingpower struggle among the Jakarta elite.

Early on in his tenure, President Wahid assigned Vice-President Megawatiresponsibility for Irian Jaya, as well as responsibility for the provinces of Malukuand North Maluku. Megawati has made two trips to Irian Jaya, the mostrecent in May of this year. Although highly publicised, the May trip failed toyield any positive results. In many ways, her trip only served to strengthenthe resolve of Papuans further, as they felt slighted by her brief appearances ateach stop and frustrated by their inability to engage her in a dialogue on theissues confronting the province.

During the time that Megawati had responsibility for Irian Jaya, PresidentWahid was also conducting his own campaign in the province. The mostmemorable trip was on the eve of the millennium, when he viewed the sun-rise from Jayapura. During that trip he stated that the province should berenamed Papua and that the Papuans would be allowed to fly their ‘MorningStar’ flag. It was at this time that he was also approached by the Papuanleadership about attending their Second Papuan National Congress, to beheld in May and June 2000. His initial comments were supportive and thiswas taken as a positive sign by the Papuan leadership.

This was to later become one of his first major points of conflict with hiscabinet and parliament. He indicated that he would support the congressfinancially and would also open the congress in Jayapura. Members of hiscabinet at that time baulked at the idea, criticising him both for his policyand also for not consulting them prior to making what they felt was a majorpolicy decision. President Wahid had subsequent meetings with the Papuan

BUT DESPITE THE GOVERNMENT’S NEW

POLICY, THE AUTHORITIES ON THE GROUND

IN IRIAN JAYA HAVE FOR THE MOMENT

HELD BACK

THE POLICY CHANGE CAME AFTER THE

WAMENA INCIDENT, BUT JAKARTA SEEMS

TO HAVE HAD A HAND IN BRINGING THINGS

TO A HEAD.

DESPITE HER RESPONSIBILITY FOR THE

PROVINCE, MEGAWATI HAS DISAPPOINTED

MANY PAPUANS BY HER LACK OF

ENGAGEMENT.

THIS CONTRASTED WITH PRESIDENT’SWAHID MUCH MORE APPROACHABLE

STYLE.

BUT WAHID WAS SO CLOSE TO THE

PAPUAN LEADERSHIP THAT HE ATTRACTED

CRITICISM FROM ELEMENTS IN JAKARTA,INCLUDING HIS CABINET.


12

WAHID’S FAILURE TO ATTEND THE SECOND

PAPUAN NATIONAL CONGRESS WAS ATURNING POINT.

THE AUGUST 2000 MPR SESSION

SHOWN A FURTHER HARDENING OF

ATTITUDES.

THE MPR REJECTED WAHID’S PROPOSAL

TO CHANGE THE PROVINCE’S NAME TO

PAPUA. IN ADDITION, MEGAWATI ACQUIRED

MORE AUTHORITY IN RUNNING THE

CABINET.

\WAHID HIMSELF HAS CONTINUED TO

DISTANCE HIMSELF.

THESE CHANGES LEFT THE PAPUAN

LEADERSHIP IN A DIFFICULT POSITION WITH

THEIR SUPPORTERS.

leadership and a good rapport was developed between them, to the extentthat the main source of contact between the Papuan leadership and the cen-tral government was through the president himself, to the exclusion of almostall others. This is important, since the Papuan leadership strongly pinned itshopes of finding a solution to the Papuan problem on the president himself.However, only days before the congress, the president let it be known that hewould not attend after all. There is little doubt that he was under great pres-sure in Jakarta not to make the trip, and this was perhaps one of the first clearsigns of the president bowing to such pressure, in order to protect his politi-cal position.

In the wake of President Wahid’s failure to attend, the government’s moodtowards Irian Jaya and the leadership started to change immediately follow-ing the Second Papuan National Congress. A number of statements by thecabinet secretary underscored the change in policy, branding some of theleaders as traitors. Accusations were also made at the time about unnamedforeign involvement behind the separatist movement. These themes, althoughunproven, would gain additional credibility.

As the August MPR session approached, President Wahid found himself un-der additional pressure from a number of sources regarding the efficacy of hispresidency. His sympathetic stance towards the Papuans made him vulner-able to attacks from his political opponents.

During the MPR session, the delegates took an increasingly hard-line posi-tion towards separatists. One indication of this was seen in the decision toreject the proposal to change the name of Irian Jaya to Papua, or West Papua,in direct opposition to the statement that the president had made to thePapuan people. If ever there was a sign that the president’s previous vision wasdead, then this was it. Such a small but highly symbolic gesture could havebeen used to advantage in diffusing the Papuans loss of faith in Jakarta. In-stead, their fears were only confirmed, hardening their resolve. To make mat-ters worse from a Papuan perspective, President Wahid was also forced torelinquish daily responsibilities of the presidency to Vice-President Megawati.Indeed, it was this move that gave her a mandate to take a more hard-linestance towards the Papuans, which she appears to have done in Septemberwith dire results.

Interestingly, President Wahid has continued to distance himself from thePapuan problem. It is possible that he has now come to realise that his previ-ous position put him too far ahead of his cabinet and parliament, just whenhe was feeling increasingly vulnerable politically. Continuing to be closelyassociated with the issue would leave him exposed to further attacks at a timewhen he is trying to diffuse potential areas conflict between himself and hispolitical opponents.

One consequence of his disengagement from the process was that it left thePapuan leadership in an increasingly awkward position. Papuan leaders wereable to hold off the more radical elements at the Second Papuan NationalCongress (who had wanted to form a government in exile immediately), bypushing for a structured dialogue with the central government. Members ofthe congress gave the leadership until 1 December 2000 to achieve their

13


THE PAPUAN PRESIDIUM MADE APROPOSAL TO KEEP THINGS MOVING AND

AVOID 1 DECEMBER 2000 BECOMING ASHOWDOWN, BUT THIS FELL ON DEAF EARS.

THERE ARE NOW CALLS FOR A CHANGE INTHE LEADERSHIP OF THE PAPUAN

PRESIDIUM.

OTHER ATTEMPTS TO REOPEN A DIALOGUE

HAVE MET WITH LITTLE SUCCESS AS

MUTUAL SUSPICION HAS INCREASED.

MANY IN JAKARTA DO NOT WANT TO SEE

ANY FURTHER DIALOGUE OUTSIDE THE

INSTITUTIONS ALREADY IN PLACE.

THE MOST RECENT MEETING BETWEEN

THE PRESIDIUM LEADER AND WAHID WAS

INCONCLUSIVE AND THOUGHT TO BE

UNSATISFACTORY.

mains goals, which included establishing an electoral commission in the prov-ince, writing a constitution and setting up an embassy with Indonesia.

That date is rapidly approaching with no clear progress having been made bythe Papuan leadership. Their hope had been to come to an interim agreementwith the central government in the form of an MOU stating three points: (1)declaration of Irian Jaya as a zone of peace, which would be weapons-free onboth sides, (2) the start of a comprehensive dialogue addressing the concernsof the Papuan people, and (3) the acceleration of economic development. ThePapuan Presidium (known under the Indonesian acronym of PDP) had hopedthat this MOU could be signed and socialised among native Papuans beforethe 1 December 2000 deadline. This would have enabled them to declare asmall victory and turn the day into one of celebration rather than one ofdemonstration and possible conflict.

It now seems highly unlikely that the signing of the MOU will take place anytime soon, if ever. This puts the current leadership of the Papuan Presidiumat serious risk, as Papuan leaders have no concrete results to present to theirPapuan constituents. Calls for changes to the leadership have already startedto emerge in some of the local Jayapura newspapers. If new leadership emergesit will most likely be more radical and less inclined to engage in meaningfuldialogue.

To date, the efforts at dialogue have not met with success. The original planfor a team included Barnebas Suebu and Izaac Hindom, was rejected by thePapuan Presidium. They indicated that since the two were Papuans there waspotential to create horizontal divisions among the Papuan community. Basedon this, the proposal was rejected. In an interview, Barnebas Suebu statedthat he has been appointed by President Wahid to act as an intermediarybetween the central government and the Papuans. It has not yet been con-firmed that he will be accepted by the Papuan Presidium; nor is there anyclearly defined timetable for dialogue.

A broader dialogue between the central government and the Papuan peoplealso does not have universal support, especially in parliament. A.M. Fatwa,the deputy speaker of DPR (House of Representatives), made the argumentthat the dialogue should occur within the context of the democratically electedrepresentatives of the province, and not by creating a new channel of commu-nication when one was already in place (see interview on page 18). Thus, thedialogue should be restricted to include only the central government and theregional and local parliaments. Anything else would subvert the democraticprocess. While technically correct, this narrow viewpoint will do little tosocialise the decisions that would be made within this context.

The Papuan Presidium had high expectations for a meeting that occurred onTuesday 24 October in Jakarta between Theys Eluay, leader of the PapuanPresidium, and President Wahid. Both sides had deferred any further actionon the issue of the ‘Morning Star’ flag until the meeting took place. But themeeting, which was also attended by Yorrys Raweyai, controversial memberof the Papuan Presidium and leader of the notorious Pemuda Pancasila (see


14

SUBSEQUENT GOVERNMENT STATEMENTS

HAVE REITERATED THE HARD-LINE STANCE:THE ‘MORNING STAR’ FLAG MUST GO.

PRESIDENT WAHID IS LITTLE ROOM FOR

MANOEUVRE, AS HIS OWN POSITION ISUNDER PRESSURE. AS A RESULT IT ISDIFFICULT FOR HIM TO FIND A SOLUTION.

MEGAWATI’S MOTIVES FOR FINDING ASOLUTION ARE DIFFERENT TO WAHID’S.

THE CURRENT PAPUAN LEADERSHIP NEEDS

TO FIND A SOLUTION IF IT IS TO SURVIVE.

WHILE ALL PARTIES MAY DESIRE ASOLUTION, THEY HAVE VERY DIFFERENT

INTERESTS THAT MAY BE DIFFICULT TO

BRIDGE.

IF THERE IS A CRACKDOWN, THE STATUS

QUO COULD RETURN AFTER INITIAL

RESISTANCE.

interview on page 19), was less than satisfactory and seems to have led no-where. Certainly, no positive outcomes were forthcoming. Theys indicatedthat there were wide differences in opinion between the president and thePapuan Presidium. No timetable for further meetings was established andfuture contact will be with Coordinating Minister for Political, Social andSecurity Affairs Bambang Susilo Yudhoyono, and not the president or thevice-president. Judging by his previous comments, Yudhoyono is likely to beless than sympathetic to the Papuan leadership.

Subsequent to this meeting, the president announced through his cabinetsecretary, Marsilam Simanjuntak, that the ‘Morning Star’ flag would remainbanned because it has become a political symbol of separatism. He indicatedthat the Papuans would be free to fly another flag, if it carried only culturalsignificance. This offer has so far been rejected by the Papuan Presidium.

Clearly President Wahid is on the ropes in regards to the question of IrianJaya. He realises that a solution must be found, but that his heartfelt at-tempts are now a liability to his political standing. Nonetheless, failure tofind a solution will inevitably result in a loss to his own credibility, already acommodity in somewhat short supply. Failure to find a solution would mostprobably result in increased violence, for which he would also be blamed.This would also provide a further rallying point for his opponents, at a timewhen he needs every success that he can muster.

Vice-President Megawati, on the other hand, also wants to find a solution tothe problem, but for rather different reasons. Failure to solve the problemcould result in the disintegration of the republic and, with it, her father’slegacy. By all accounts, she has become increasingly sympathetic to themilitary’s view on disintegration since the loss of East Timor one year ago.Furthermore, by taking a hard-line approach, she can also gain additionalcredibility within the military, something that will be an important source ofsupport if she is to take greater control of the government in the future. Withthe pressure building on President Wahid, this may have been in her mindwhen the decision was taken to remove the ‘Morning Star’ flag in Wamena.

The Papuan Presidium must also find a solution acceptable to its base ofsupport if it is to survive. The expectations that have been instilled among thenative Papuan people are now extremely high. They are also very immediate.

It is clear that the various actors are anxious to find a solution to the problemof Irian Jaya and the question of Papuan separatism. However, their motiva-tions for finding one are diverse and to some extent divergent. This has led usto look at how these motivations might intertwine, and the possible out-comes that could emerge in the coming months. We have isolated three sce-narios that we consider the most probable.

ScenariosOne scenario is that the security forces, comprising the police with substan-tial military support, take an increasingly hard-line approach on the issue,despite the temporary pause that has been reached at this juncture. In thisscenario, flags would be pulled down across the province and arrests madeamid a general tightening of security. After an initial outbreak of resistance by

15


native Papuans, violence would gradually abate and be replaced by a generalresignation and acceptance of the status quo. People would return to theireveryday lives. Eventually, order would return along the lines of that whichexisted before expectations were raised by Papuan Presidium leaders.

If this were to occur, President Wahid would be discredited. It would signalthat the military and the hardliners within the cabinet had gained the upperhand. Equally, it would indicate that the president’s vision had been provenunrealistic and dangerous. One of President Wahid’s most cherished and fewremaining causes would be no more. The Papuan Presidium would also bemarginalised, with Papuans losing confidence in their leaders’ ability to lead.

The realisation of this scenario would depend primarily upon the reaction ofthe Papuans to a general crackdown. While this outcome would have beenmore probable a decade ago, communications have improved significantly inrecent years, and there is a likelihood that native Papuans’ awareness of theirown ‘togetherness’ on an issue has risen in line. Given the broad popularsupport that exists among the Papuans for independence, this scenario is theleast likely to occur.

A more likely scenario is that following a crackdown by the security forces,there would be violent resistance from the Papuan community on a scale notseen hitherto. Such a government policy would probably also serve to radicalisethe Papuan Presidium, marginalising the moderates within the leadership. Aviolent reaction to the extent that it targets the non-indigenous residents ofIrian Jaya would have a disastrous effect on the province. It could trigger amass exodus of transmigrants, especially from the interior districts of the prov-ince. This would have the effect of crippling the economies and social infra-structures of those districts, which are dominated by transmigrants. Further-more, an exodus of refugees towards the coastal towns would place great strainon the infrastructure and systems of those hubs that are key to the province.It is worth remembering that thousands of transmigrant refugees sought shelterin police and army installations following the Wamena violence. It could takeonly a relatively small escalation of such localised violence to set into motiona massive wave of refugees across the province. Such an obvious impact of thesocial infrastructure could serve to embolden the native Papuans further andfill them with confidence. Being relatively sparse on the ground and easilyoutnumbered, police and army personnel could also be tempted to join theexodus.

This second scenario would also trigger a strong international reaction andfurther depress foreign investment, both in the province and in Indonesiagenerally. It would give the international NGO network additional ammuni-tion with which to pressure Indonesia. If unrest spiralled out of control, theprospect of images of traditionally clad tribesmen fighting heavily armed In-donesian soldiers (who already have a less-than-enviable reputation) beingflashed onto television screens across the world is horrifying and would doirreparable damage to the country’s reputation. This, in turn, would inevita-bly trigger a nationalistic backlash within Indonesia, stoked by members ofthe Jakarta elite, adding further fuel to the fire and provoking a full-blowncrisis with the international community. Under such a scenario everyone would

BUT THE CRACKDOWN WOULD DISCREDIT

WAHID AND HIS VISION, AND MARGINALISE

THE PRESIDIUM.

BUT IT IS IMPOSSIBLE TO KNOW HOW THE

PAPUANS WOULD REACT TO A HARD-LINE

APPROACH.

A MORE LIKELY POSSIBILITY IS THAT AHARD-LINE CRACKDOWN WOULD TRIGGER ASPIRAL OF VIOLENCE, SETTING IN MOTION

AN IRREVERSIBLE TRAIN OF EVENTS IN THE

PROVINCE.

THE INTERNATIONAL COMMUNITY COULD

ALSO BE DRAWN INTO THE PROBLEM,CREATING A BACKLASH AGAINST FOREIGNERS

AND PLACING FURTHER STRAIN ON THE

ECONOMY.


16

lose, although certain sections of the elite might hope to profit from theturmoil. Again, President Wahid would shoulder much of the blame, as theperson responsible for encouraging Papuan separatist sentiments in the firstplace. The police and military would be subject to additional internationalcondemnation. It is not inconceivable that such a breakdown in the situationcould even pressure the UN to reconsider its stance on the Act of Free Choiceof 1962, realising one of Indonesia’s worst fears.

A third scenario involves a get-tough policy that minimises the use of vio-lence. The government would increase pressure to eradicate the symbols ofindependence, while engaging in a limited, but nonetheless sincere, dialogue.The main difference would be that existing institutions were used, such asthe local parliaments and religious groups, in order to facilitate this dialogue.This would satisfy one of the main concerns expressed by Deputy SpeakerA.M. Fatwa in his interview with the Van Zorge Report on page 18, namelythat the government institutions already in place would be short-circuitedand undermined by a dialogue process (for example with the Papuan Pre-sidium) that did not include them. By way of a compromise, a special au-tonomy package giving wide-ranging fiscal and administrative powers to theprovince would be unveiled. Sufficient native Papuans would see the benefitsof this approach and would support the policy of the government. The inter-national community would be able to justify its position of supporting theterritorial integrity of Indonesia by citing increased local autonomy. The po-lice and the military would be relieved at not having to deal with a possiblefull-blown insurgency on their hands. It would also serve to marginalise someof the more radical elements with the Papuan community and brand them astroublemakers.

While this scenario may fall short of establishing the comprehensive dialoguethat many in the Papuan leadership and community demand, it might none-theless be achievable and satisfactory if conceived creatively and with visionand trust. It would almost certainly be the preferable scenario for the major-ity of people in Irian Jaya, both native Papuans and transmigrants. However,the majority does not always control events. Indeed, this has been the prob-lem in the entire history of the Papuan people. It would, in some ways, vindi-cate President Wahid’s previous approach. It would be a tragedy if aversion tosuch a vindication of Wahid’s policy were to make the solution less appealingto certain elements of the elite.

Which particular road is followed will be primarily driven by the Jakarta eliteand how these decision-makers choose to relate to the restive province and itspeople, and perhaps even each other. The stakes are, in truth, incredibly high;not just one province is in the balance here, but an entire method for dealingwith a vast archipelago searching to find a way of living with itself is beingformulated. President Wahid had the vision, but maybe not the secure politi-cal base of support back in Jakarta or the political acumen to carry it through.He needed to convince both the Papuan leaders and the Jakarta elite, and inthe end failed on both counts despite the best of intentions. Now, the halls ofthe State Palace and the House of Representatives reverberate with fears offoreign manipulation and politically inspired moves to bring down the presi-dent. This is hardly an auspicious environment in which to approach one of

ANOTHER POSSIBILITY IS THAT THE

GOVERNMENT COULD GET TOUGH WITHOUT

EXCESSIVE VIOLENCE. LIMITED DIALOGUE

WOULD HAVE TO BE KEPT OPEN, AND AN

ATTRACTIVE AUTONOMY PACKAGE

PRESENTED TO THE NATIVE PAPUNS.

WHILE THIS WOULD BE THE MOST

DIFFICULT SCENARIO TO BRING ABOUT, ITWOULD BE THE BEST FOR ALL CONCERNED.

THE FINAL OUTCOME DEPENDS ON THE

JAKARTA ELITE. IT IS A CRITICAL MOMENT,AND THE TIMING IS HARDLY IDEAL.

17


the most vital and yet finely balanced problems facing Indonesia today. It is agreat challenge, especially at this juncture in Indonesia’s tortuous progresstowards re-inventing itself after three decades of authoritarianism.

Given the Papuans’ conviction of pursuing their objectives through organisationrather than violence, Irian Jaya could be the definitive case for determiningIndonesia’s success or failure in dealing with regional discontent. The oppor-tunity is still there, but the situation hangs in the balance. However, an un-compromising position that fails to address the valid grievances of the Papuanpeople in an open and egalitarian manner will most likely have disastrousconsequences. Notwithstanding this danger, the central government has sofar done a very poor job of presenting the case for how native Papuans willbenefit from greater autonomy. As a result, a significant proportion of Papuansstill vehemently rejects the central government’s regional and special autonomyproposals.

It seems as though all the parties involved are at a turning point, and one atwhich true leadership and statesmanship are required. If the central govern-ment, and specifically President Wahid and Vice-President Megawati, pur-sue a policy that includes native Papuans in the decision-making process asequals, then there is a chance that a positive solution can be found; one thatwill bind Irian Jaya and the restive native Papuans to Indonesia through choiceand common prosperity. If such a policy were followed, it could create arallying point for all that Indonesia has to promise in the future. It would besupported wholeheartedly by the international community, and would helpto demonstrate the short-sighted nature of much of the recent nationalisticrhetoric. However, the leadership required and the ability to transcend nar-row political interests has been in short supply in recent months, and it issaddening that such a test should come at such a difficult time, when viewsare becoming increasingly polarised. But, a turning point has been reached,and directions can still be chosen—not just for one province, but for an entirecountry.r

IRIAN JAYA COULD BE THE DEFINITIVE CASE

FOR DEALING WITH REGIONAL DISCONTENT.BUT THE GOVERNMENT HAS SO FAR FAILED

TO RISE TO THE CHALLENGE.

WHILE THE OPPORTUNITY STILL REMAINS,ONLY TRUE LEADERSHIP AND VISION ON ALL

SIDES CAN AVERT WHAT COULD BECOME ACATASTROPHE.


18

Following his return from leadinga recent fact-finding mission to theWamena district of Irian Jaya, the

Van Zorge Report met with A.M.Fatwa, one of four deputy-speakers of theDPR (Indonesian House of Representa-tives) and a chairman of PAN (NationalMandate Party). In his capacity asdeputy speaker to the DPR he is respon-sible for parliamentary Commissions IV,V and VIII, covering transport and in-frastructure, industry and trade, andenergy and mineral resources. Born inSouth Sulawesi, Fatwa was jailed with-out trial for a total of eight years duringthe Soeharto era, on account of his beinga founder and signatory of the Petisi 50,a group of activists and prominent In-donesians critical of Soeharto. He wasrehabilitated when B. J. Habibie tookover the presidency. He has served inICMI, the Indonesian Association ofMuslim Intellectuals, and also inMuhammadiyah.

Van Zorge Report: The DPR is cur-rently considering the issue of special au-tonomy for certain provinces. How willthat affect Irian Jaya?A.M. Fatwa: The People’s Consulta-tive Assembly [MPR] has proclaimedthe existence of two special territories,Aceh and Irian Jaya. Legislation to di-vide Irian Jaya into three provinces hasalready been promulgated, in theform of Law No. 45/1999. However,it is difficult to implement this legis-lation for a variety of reasons. First,Irian Jaya’s natural resources are veryunevenly divided. The Kepala Burung(Vogelkop) area is quite rich, and sois Timika. But Jayapura is small andpoorly endowed in natural resources.

The second reason for the postpone-ment is the issue of human resources.The local people need to be ap-

proached on a psychological or cul-tural level, in order for them to un-derstand the reasons for the measure.They seem to be apprehensive aboutthe fact that if human resources arelimited and the province is dividedinto three sections, too many outsid-ers will enter the region and domi-nate the administration.

One of the main reasons that the cen-tral government in Jakarta considersit necessary to divide the provinceinto three separate provinces is to en-able the acceleration of the develop-ment of the region. The area is toovast. Currently, the roads are practi-cally non-existent, with poor connec-tions between the various kabupaten[regencies]. Therefore, all economicactivities have to be undertaken by air,which increases costs dramatically. Toenhance the quality of life in the area,the administrative areas should bemade smaller.

There is some resistance to the idea thatthe province should be divided, with sus-picion among the Papuan populationthat the policy is intended to prevent theemergence of pan-Papuan solidarity.As a matter of fact, this is not the in-tention. However, I can understandwhy the people feel that way. That isone of the reasons why the implemen-tation of the legislation has been post-poned.

What was the purpose of your recent visitto Irian Jaya, and what problems andissues did you encounter?Well, it is my duty as a representativeof the people to visit the regions per-sonally to experience the situation onthe spot, particularly in view of therecent unrest in Wamena. However,it is a routine part of the responsibili-

ties of a representative of the peopleto visit the regions. The uprisingmerely added to the sense of urgency.

You have said that there is a conspiracybehind the Papuan Presidium. What doyou mean? Can you explain further?We are extremely suspicious of foreignpowers that hope to gain from thefragmentation of the Indonesian na-tion. Our intelligence agencies indi-cate that there have been a number offoreign nationals who have been de-tained in Irian Jaya, and of these anumber have been arrested and sub-sequently brought to Jakarta.

In their own self-interests, many for-eign powers do not want Indonesiato be strong. Many of these powershope to gain a foothold in a weakenedor fragmented Indonesian nation. IfIndonesia is divided or broken up asa nation, it becomes easier for the for-eign power to implant, or instill theirinterests. Yes, of course, the foreign-ers are free to disagree with us, butwe as a nation should be on our guardand be concerned with such consid-erations.

Haven’t the US and other developed na-tions provided support to Indonesia, thusensuring that it is able to maintain itsterritorial integrity?We are grateful, if that is the case.However, from past experience we havelearnt that when there has been anoutbreak of social unrest in Indone-sia, foreign powers have been behindit. For example, every time there is anuprising or revolt, it is usually sup-ported by NGOs or LSMs [lembagasuara masyarkayat, Indonesian NGOs]most of which are supported by for-eign funds. The unrest is intended toserve foreign interests.r

INTERVIEW WITH A.M. FATWA

Deputy Speaker Of The DPR

“Many Foreign Powers Do Not Want Indonesia To Be Strong.”

19


The Van Zorge Report recentlyinterviewed Yorrys Raweyai, whowas invited by leaders of the

Papuan Presidium to join theirorganisation earlier this year, in whatremains a rather controversial decisionthat has done little to improve thePresidium’s standing. Yorrys rose to promi-nence in the 1990s, when he came tolead the notorious Pemuda Pancasilagroup, which was associated with manyof the strong-arm tactics of Soeharto’sNew Order regime. Many remain sus-picious of his motives in being involvedin Papuan separatist politics, es-pecially in view of the fact thathe remains the president ofPemuda Pancasila.

Yorrys’ father, who was mixedethnic-Chinese and Bugis,came to Irian Jaya from UjungPandang in 1939, and latermarried Yorrys’ mother, a na-tive Papuan. Yorrys was bornin the province 1951, andlived there until the age of 27,when he decided to leave for thebright lights of Jakarta, arriving in thecapital in 1979.

Van Zorge Report: You are a memberof the Papua Presidium. The press por-trays you as a bad influence, a negativeinfluence, on the presidium. When youread these things in the Indonesia press,if you were to answer those newspaperstories, what would you have to say?Yorrys Raweyai: Time will tell whatwill happen, because the opinions arefrom the newspaper and are just po-litical opinions. But I think that what-ever they say it’s just part of the na-tional political process. Actually, Ididn’t want to be in the presidium,and it’s all because of the democraticprocesses employed by the presidium.It wasn’t from me. I wasn’t even in

Papua at the time, but they chose meto be a part of the presidium.

Even though some newspapers say somerather unflattering things about you, theleaders of the presidium swear by you.They say that you are a solid fellow andthat they appreciate you as part of theirgroup. But why do you think they wantedyou on the presidium?I don’t know. I was a member of acultural council. Maybe, when theywere thinking about the people theywanted to include in the presidium,

they were looking for people who hadcapability and credibility. But it’sbetter if you ask them why they choseme, and not me. But maybe theythought that I could help them.

Where do you see your role on the pre-sidium? How can you help them?They have given me a role in the po-litical and social aspirations of thePapua people. I have been specificallyassigned to social and political objec-tives within the Asia Pacific region;talking with the Indonesian govern-ment; and matters of aspirations andthe dialogue with the government ifIndonesia and the Asia Pacific region.

How about the Satgas Papua and theSatgas merah putih? Are you involvedwith either one of these organisations?

On 2 August we talked with the headof police and the chief of the military,because there is an incorrect interpre-tation of these Satgas groups. Thereare different perceptions about theSatgas, and I have already spoken tothe head of the police and the mili-tary chief about the Satgas to explainto the military and the police that theSatgas groups are not meant to be likea militia force. We are organising theSatgas as volunteers for the benefit ofthe community in Papua.

What would they do in thecommunity? How would theyhelp the community? Commu-nity work?

Right now we are develop-ing concepts for the Satgasgroups, for utilising themby giving them training andeducation so that they canserve as a partner of thePapua presidium; a partnerwith the government, but

beneath the Papua presidium. For thefuture we still don’t know.

What’s the difference between the twogroups: Satgas Papua and Satgas MerahPutih?Satgas Merah Putih has evolvedwithin the interest of the local gov-ernment. It’s the local governmentthat has formed Satgas Merah Putih.And the Satgas Papua is beneath thepresidium and the LMA [the culturalcouncil].

What would you like to see happen interms of the relationship between the cen-tral government in Jakarta and Papua?I mean the new democratic government,not the old government. If you could havethe best outcome for Papua, what wouldthat be?

INTERVIEW WITH YORRYS RAWEYAI

Member of the Papuan Presidium

“Maybe The Output Could Be: One Nation, Two Systems.”

“WE SEE THAT PRESIDENT GUS

DUR, AKBAR TANDJUNG AND

AMIEN RAIS ALL HAVE DIFFERENT

AND CONFLICTING PERCEPTIONS

AND UNDERSTANDINGS OF PAPUA.THIS IS THE PROBLEM.”


20

We see that President Gus Dur, AkbarTandjung and Amien Rais all havedifferent and conflicting perceptionsand understandings of Papua. This isthe problem. Within the Papuanstruggle we are trying to place human-ity above politics.

How are these perceptions between GusDur and Akbar Tandjung and AmienRais different? What are the differences?Gus Dur is more moderate in hisstance towards Papua. AkbarTandjung is still using theold paradigms to view Papuaand the Papuan struggle.Amien Rais, in my view, ismore concerned with movingPAN into the future. In fact,when he campaigned inPapua in order to try and lurePapuan votes he said that ifPAN won the elections they wouldgive Papua a federal system of gov-ernment.

Do you think that either AkbarTandjung or Gus Dur are willing toapproach this sort of view that Papuawould be one of the states within a fed-eration?This is one of our basic rights. Thegovernment must talk to the pre-sidium. Maybe the output could be:one nation, two systems. Internationaldiplomacy would be through Indo-nesia. So, we could have an economylike Hong Kong, but a political sys-tem like Puerto Rica.

Describe the old paradigm that peoplelike Akbar Tandjung and the old gov-ernment use. What is it that you think theysee in Papua. How do they view Papua.What characterised the old paradigm?We saw this before the congress hadfinished. The results of the congresswere not yet known. Before the con-gress had finished and before the con-gress had issued any statements orconclusions Akbar Tandjung had al-ready come out with a statement say-

ing that the congress was separatistand its members as traitors. And hisstatements were very emotional state-ments. Gus Dur is the only one whois trying to be open and trying to findsolutions. And you have to ask your-self why has the Papuan communitymade these demands, which cannot,after all, be ignored.

Do you think that the congress will an-nounce that if Gus Dur remains thepresident the congress will be open to ne-gotiations, but if not Papua will harden.At the present time, we see that inthe entire government it is only GusDur who accepts that there should be

a dialogue. So, if there is no more GusDur, then what does Papua have?We’re back to square one. They wouldbe better off independent. That’s forsure.

There is one person that I don’t see onyour list, and that’s Megawati. Wheredo you think that Ibu Mega comes downin this?[laughter] Well, Megawati doesn’t talkabout it. So, I can make no comment.

What did she say when shecame back from her journeyto Papua?She was only here for 10minutes. You cannot doanything in that time. It’sjust wasting time. She spenta lot of money. Doing noth-ing.

What did she say when she came back?No statement?No statement.

I think that she believes there is too muchtalk in Indonesia right now and notenough action.All critical. No one can give a solu-tion. Every day there are demonstra-tions and more demonstrations. Sothere is no certainty.

What is your guess about Megawati. Doyou think that she has sympathy for thePapuan people?I have no comment on that.r

“GUS DUR IS THE ONLY

ONE WHO IS TRYING TO

BE OPEN AND TRYING

TO FIND SOLUTIONS.”

21


VZH LEADERS’ GETAWAY, SPEECH BY ADAM SCHWARZ, EDITOR-IN-CHIEF, ASIAWISE.COM

“Indonesia’s Political Transition: Forwards or Backwards?”

Adam Schwarz was a guest speakerat the Van Zorge, Heffernan &Associates Leaders’ Getaway held

in Yogyakarta in September—a bian-nual gathering of senior executives fromthe foreign business community and keydecision-makers within the Indonesiangovernment and parliament. Widely re-spected for his book A Nation in Wait-ing, Mr Schwarz is currently editor-in-chief of Asiawise.com, an online busi-ness and finance publication, and liv-ing in Hong Kong. Drawing on his greatexperience in Indonesia and his under-standing of the views of investorslooking at Indonesia from theoutside, we include the highlightsof his keynote address.

I like to begin any discussionof contemporary Indonesianpolitics with a reference to whereIndonesia was a few years ago.It’s a point that often gets lostin discussions, particularly bythose outside Indonesia. I al-ways hear Indonesia being com-pared with its peers, or fellowcrisis countries: Thailand, Malaysiaand, to some extent, South Korea. Of-ten, Indonesia comes off poorly insuch comparisons. But these compari-sons are part of the problem, becauseif we look at the magnitude of thedifficulties Indonesia started with,Indonesia has no real peer. Aloneamong these countries, Indonesia wasup against a fundamental politicaland economic crisis the likes of whichthese other crisis countries did nothave to face. So, it’s unfair to measureIndonesia against these other coun-tries. In Indonesia the problems weregreater and, as a result, the solutionsare going to take longer to find, allother things being equal.

Let me talk briefly about those ‘otherthings.’ I want to go over a couple ofpositive trends, at least as I see them.One is the pace of change. It’s beenjust over two years since PresidentSoeharto stepped down. It’s about 15months since parliamentary elections,and about 10 months since PresidentWahid took power. It seems like a life-time ago—all the more so for peoplewho are living here and paying atten-tion—since President Soehartostepped down. It seems like a lifetimeago since President Wahid took power.

There’s a lot been going on. But, af-ter all, it is actually quite a short pe-riod of time. Now, some people wouldnot put this in a list of positives. Theywould say that the pace of this changeis a liability, and that’s certainly anargument one can make. It is veryrapid. But, a better question to ask is,what is the alternative? What choicedoes Indonesia have? And I don’tmyself have an answer to that. I don’tsee how this could have been donedifferently in a credible way thatwould have been better. So, althoughthere is very much the sense of a blind-folded dive into the deep end of apool, which is an uncomfortable ex-perience, I don’t really see how it

could have been done differently. Re-flecting on comments I hear abroad,about how things should have beendone differently, and how thingsshould be done differently, it is worthremembering that this is not an aca-demic exercise. This is reality push-ing the process along, and politicianshave to deal with that.

The second thing to note, which of-ten gets swept under the carpet be-cause so much remains undone, arethe things that have been done. That

is to say, there have beenchanges, and there have beenimprovements. There hasbeen a good deal of what wemight put into the broadcategory of political reform.These include the military’srole in politics, once domi-nant but no longer. Thenthere is the emergence of awhole class of civil-societyorganisations, from theparliament to the media, tocorruption watchdogs, to

consumer advocacy groups and manyother groups. These were all once in-effectual and at the margins, and nowthey have come to be in the middleof the action in a very short period oftime. The attorney-general’s office,almost a decoration in the New Or-der, is now a viable, important playeron the political scene. And lastly, theeconomy, which is an area where Ithink the disconnect with the viewson the outside is particularly strong.The view from abroad, and particu-larly the view from the financial mar-kets, is that there is very, very little ofanything positive going on in Indo-nesia. It’s hard to engage the finan-cial markets in Hong Kong (where I

“IT’S UNFAIR TO MEASURE

INDONESIA AGAINST THESE

OTHER [CRISIS]COUNTRIES. IN INDONESIA

THE PROBLEMS WERE

GREATER…..”


22

live), and the people who work in it,on the subject of Indonesia. Peopledon’t want to hear about it. That is initself a major hurdle for Indonesia toget over.

But again, the focus there is often onthose leading indicators you get bywatching CNBC. You’re talking aboutthe currency and the stock market,and those are indicators that are par-ticularly vulnerable to political swings.They go up and they go down, andthere’s been a lot of down. People tendto take their cues on what’s going onin the economy from these indicators.But, as you know, there’s actuallymore going on here. Growth is pick-ing up, exports are picking up,there is growth in consumer de-mand, and there is some invest-ment growth. If you look at arange of statistics, some anec-dotal, in small- and medium-size enterprises, there is activ-ity.

If you’re looking at indicatorson car sales and residentialleases, on the price of cement,you can see that there is activity go-ing on; there are pockets of wealthhere, leading one to conclude thatthere has been some recovery of pur-chasing power in the economy. Ob-viously, a great deal remains to bedone, but the point is that weshouldn’t draw too many conclusionsfrom simply watching the currencyand the stock market. As I said, I thinkthese are very subject to politicalswings, especially given that there isvery little ballast and very little turn-over in both.

That’s not an exhaustive list but, hav-ing gone through it, one is temptedto then say to the pessimists, to thosewho want to despair: “Okay, you’remissing the forest of this gradual po-litical reform for the trees of regularsetbacks.” But, this does beg the ques-

tion: “Which is the forest and whichare the trees?” My own feeling is thatthe forest is, in fact, the underlyingtrend of erratic but inexorable reforms.For me, this is the forest, the big pic-ture. But others might argue that thesetbacks are the issue. The violence,the political in-fighting, the politicalimmaturity, a recalcitrant military (orpockets of the military), the disap-pointment that one hears in the po-litical process, in the president him-self.

Some would say that this is the realstory; this is the forest. That, for me,is the question to be asked of Indone-sian politics today. But, my own view

is that the former underlying trend iscloser to the truth. I still think thaton a trend basis there is movementforward and that this is the real story.

But there are obviously plenty ofpeople on the other side of that de-bate, and they have some pretty goodarguments in their arsenal. And it’strue also that the consensus view inthe international financial markets isthat it is the trees that are becomingthe forest. It is the problems and set-backs that are increasingly formingpeople’s views in the financial mar-kets about developments here, andthat, I think, is slightly unfair andsomewhat incorrect. But, at somepoint, perception becomes reality,and, for Indonesia, this is becomingone of its challenges: to manage thatperception process better.

For my part, I take heart in some ofthe things that have not happened. It’suseful to note that there has not been,despite a society and a political sys-tem being under tremendous stress,a turning inwards as one might haveexpected and which one sees happen-ing elsewhere. There is no surge of pro-tectionist populism. There has notbeen, to date, a surge or resurgence ofethnic-based economic favouritism.So, although resources broadly de-fined (material, physical, natural,human) are stretched very thin, mysense is that there’s enough here tomove the system forward, that it’sadequate for the job.

But, obviously, there are stillsome very, very serious obstaclesin the road. I want to wrap uphere by going through a veryshort list of what I see as thekey things that have to be done.Once again, this is the view thatis admittedly colored by whatI do from Monday to Friday,from my perspective living inHong Kong.

To clarify this view, let me runthrough what I see as the real chal-lenges that lie between the forest andthe trees. First is the broad issue ofstability, of law and order. This againcomes through very clearly when youtalk to people abroad about investingin Indonesia. No government of anypolitical persuasion can survive forlong without providing a basic levelof security. One of the truisms of poli-tics is that capable law enforcementis a necessary and vital element of run-ning an effective government. That’san obvious point. The more interest-ing question is: what do you do aboutit in this political system? I don’t havethe answer to that. But the core ofthat issue involves moving to the nextstep of finding and defining themilitary’s role in the political system,writ large.

“WE SHOULDN’T DRAW

TOO MANY CONCLUSIONS

FROM SIMPLY WATCHING

THE CURRENCY AND THE

STOCK MARKET.”

23


Law enforcement is normally a func-tion of the police force and, down theroad, I have no doubt that this willbe the case in Indonesia. But it’s notthe case today, and there seems to begeneral agreement that the policeforce is not up to the task today. Andthat brings us back to the military.It’s pointless to pretend that the mili-tary does not have political influence.It does. Either through action or in-action, it has influence. If there’s go-ing to be an improvement in law en-forcement, this influence has to berecognised and accommodated insome way. I want to be careful in us-ing the word ‘accommodated’ becauseI’m not actually suggesting a particu-lar course of action. What I’msaying is that there are two endsto the spectrum. At one end ofthe spectrum, the military isscapegoated for the sins of thepast and, at the other, the mili-tary is absolved of any respon-sibility for the sins of the past.Both of those poles are unten-able as a political choice in anemerging democracy. The ques-tion is: where in the middle doyou go? And that, obviously, isa question for the Indonesian politi-cal leadership. My point is that the is-sue needs to be settled. The harm hereis in the status quo; in avoiding anydecision. A difficult decision is beingignored, as if it will go away untreated.I don’t think it will. Indeed, I wouldargue that it will only become moredifficult if the decision remains unad-dressed.

The second broad area that the out-side world is looking at is theeconomy. To be brief, I will take a fairlyeasy way out by borrowing LaksamanaSukardi’s mantra, which is that, “Theanswer lies in the institutions.” I don’tsee any real reason why—and I’venever been persuaded by any eco-nomic analysis to the contrary—In-donesia cannot grow its way out of its

current problems, large and intrac-table as they may seem. Just imagine,if we were talking about growth thisyear of five or six percent rather thanthree to four percent, and if we weretalking about a rupiah in the range ofRp 6,000 to Rp 7,000 to the dollaras opposed to bumping up againstRp 9,000, that already would makea huge difference in the perception ofIndonesia and its prospects today.There is, after all, a lot of bad newsalready priced into Indonesian assets.There is wealth in this country and alarge wealth-creating capacity. But theissue does tend to come back to insti-tutions. Can you get the courts tofunction, can you get the bureaucracy

more generally to facilitate productiveenterprise rather than extract rentsfrom it? Can you get the banks to lendon collateral and not on connections?One could go through a longer list,but that is the idea. How do you getsome of the inefficiency out of thehigh-cost economy. There’s still a longway to go there. Where Indonesianeeds to go is generally well under-stood, but the progress is frustratinglyslow for many people. The commonview held by foreign investors, par-ticularly as they look at Indonesia asone of many possible alternatives fortheir investment capital, is thatprogress has been painfully slow.

Third and last, we always end up onthe issue of political leadership. Asthey say in that old Porsche commer-

cial, “There is no substitute.” There’snothing automatic about recoveryand herein lies another danger: oneoften comes away from discussionswith policymakers in Jakarta withoutfeeling a sense of urgency. Often,there’s an unstated assumption thatthere is something inexorable aboutrecovery; it’s coming almost no mat-ter what we do. Well, I don’t think itis. Recovery is achievable, but it’s go-ing to take action and activity to bringit. Now, President Wahid has actu-ally done a fine job on a number offronts, although it’s often tough tofind company in that argument. Heunderstands the critical issue, namelynational unity. I’m impressed with his

vision and his decision to putthis at the very top of his pri-ority list. But I think now thetime has come to push forwardand to apply that vision moreconcretely on a number of dif-ferent fronts, and to do so witha sense of urgency: on the mili-tary, for the reasons just dis-cussed; on corruption, wherecourt cases are languishing; ona range of economic policy is-sues, such as whether to sell

IBRA assets, when, and to whom;whether to sell state enterprises, forhow much, how many, and to whom;fiscal decentralisation: what, how fast,and how soon. These are questions thatare not going to answer themselves.Leadership is crucial in providingthese answers, or at least in initiatingan enlivened debate on these issues.And it is a source of concern, to put itmildly, that there hasn’t been moreof a vigorous debate on some of theseissues already. These problems, again,are of that category that aren’t goingto go away if untreated. They can beresolved, but not by inaction.

So, to conclude, memories are fa-mously short in politics. I think thepresident can still, but perhaps lessso than he once was able to, credibly

“NO GOVERNMENT OF

ANY POLITICAL

PERSUASION CAN SURVIVE

FOR LONG WITHOUT

PROVIDING A BASIC LEVEL

OF SECURITY.”


24

blame frustrations over the pace ofprogress on the magnitude of theproblems that were inherited at thestarting line. This is an implicit wayof pinning some of the blamefor his problems on previousgovernments, which, I think,is fair enough. But I also thinkthat time is running out. Itseems to me that the onus isincreasingly falling on thepresident to produce solutionsto today’s problems and not ex-planations for why they areproblems. The president is go-ing to be judged, and, indeed,is increasingly being judged,on his performance rather than hisplans for what he intends to do. Now,the gap between these two boils downto political leadership. I think there

is room for optimism in that the ca-pacity for leadership and the peoplein positions to be leaders are there.There are those resources; there are

those tools. But whether they are go-ing to be put in a position to providethat leadership and to exert that pres-sure on this process is the question

which remains unanswered. If the for-est and trees questions are the short-term questions today, then the politi-cal leadership question is the medium-

term question. I don’t have ananswer to that. But, from myperspective, that’s what Iwould focus on. Are we goingto see the Indonesian politicalleadership make this shift fromexplaining and dealing with anadmittedly difficult-to-deal-with past, and turning the shiparound and moving it forward?Those are the signposts that I’mtrying to keep an eye on andthat is all we can do.

So, I will stop there and thank youfor giving me a chance to talk thismorning. Thank you very much.r

“I DON’T SEE ANY REAL

REASON WHY…..INDONESIA

CANNOT GROW ITS WAY OUT

OF ITS CURRENT PROBLEMS,LARGE AND INTRACTABLE AS

THEY MAY SEEM.”

25


In recent weeks, significant additional details have been made available bythe Indonesian government regarding the ongoing planning process for theimplementation of fiscal decentralisation in Indonesia. On 13 October 2000,a meeting of the Pre-Consultative Group on Indonesia was held to discussdecentralisation. This meeting was attended by many donors and key officialsfrom the relevant Indonesian government agencies. This venue provided thegovernment with the opportunity to present a clear and reasonably coherentstatus report that formed a useful foundation for assessing Indonesia’s progresstowards decentralisation. Much useful work was included in thedecentralisation reports made available at the meeting, the contents of whichindicate that around 75 percent of the preliminary technical work required tounderpin successful decentralisation is now in place.

However, while the government has made much progress with the technicalwork, it has avoided making clear decisions regarding the ultimate goals ofthe decentralisation process. The key technical documents have already beenworked through within the government and subsequently made public, al-though major details could still differ from those currently stated. Despitethis, the involvement of key groups such as the business community, parlia-ment and the general public, still appears to be limited.

The substantial benefits of a successful fiscal decentralisation programme forIndonesia, as elsewhere, lie in the expenditure decisions that better reflectlocal needs and aspirations. Some believe that these benefits relate to a moredemocratic decision-making process, which basically amounts to the samething, since such improved decision-making will better match consumer pref-erences with government expenditures. Most of the major questions that needresolution have already been formulated, and many have been usefully ad-dressed.

Although hidden from public view for a number of months, there have beennumerous disagreements within both the government and among the foreigncommunity regarding the pace and extent of Indonesia’s decentralisationprogramme. The disagreements among the Indonesian players have beenbroadly similar to those coming from the various foreign players and relate tothe benefits and costs of decentralisation. As might be expected, central agen-cies that risk losing authority and functions have resisted moves towardsdecentralisation. Conversely, those who stand to gain from the decentralisationprocess, such as local government officials, have called for more power andauthority than they are likely to be granted.

The Ministry of Finance has been more forthcoming than has often been thecase in other countries embarking on a similar course. However, the recent

FROM GOVERNMENT REPORTS RECENTLY

MADE AVAILABLE ON PLANNING FISCAL

DECENTRALISATION, IT APPEARS THAT

AROUND 75 PERCENT OF THE TECHNICAL

WORK IS NOW IN PLACE.

HOWEVER, THE GOVERNMENT HAS

AVOIDED MAKING CLEAR DECISIONS ON

ULTIMATE GOALS, AND THE INVOLVEMENT

OF KEY GROUPS REMAINS SUCH AS THE

BUSINESS COMMUNITY AND PARLIAMENT

REMAINS LIMITED.

THE MAIN BENEFITS OF DECENTRALISATION

RELATE TO A MORE DEMOCRATIC SYSTEM OF

DECISION- MAKING.

THERE HAVE BEEN DISAGREEMENTS, BOTH

AMONG INDONESIAN AND FOREIGN

INTERESTS, AND A STRUGGLE BETWEEN

THOSE WHO WILL LOSS AUTHORITY AND

THOSE WHO WISH TO ACQUIRE AS MUCH

AUTHORITY AS POSSIBLE.

THE MINISTRY OF FINANCE IS BECOMING

MORE REALISTIC. THERE IS ACCEPTANCE

REGIONAL AUTONOMY

Indonesia’s Progress Towards Fiscal Decentralisation

With the 1 January 2001 deadline for the implementation of decentralisation fast approaching, more information is nowbecoming available from the government. While there seems to be general agreement that many issues will not be decided intime to meet the deadline, the government is nonetheless making steady progress with some of the technical details required,while leaving bigger decisions for later. We take a look at the latest developments in this critical area of government policy, andthe risks and concerns that remain.


26

pronouncements by the government are much more uniform and would seemto indicate that reality has set in concerning the appropriate pace ofdecentralisation. Moreover, officials in the now-defunct Ministry of RegionalAutonomy and the Ministry of Home Affairs have probably ensured that thedecentralisation process is irreversible by building up local government de-mand for the process. The result is that advocates of decentralisation are nowmore willing to acknowledge that not everything will happen on 1 January2001, the date previously scheduled. This acknowledgement permits a morerealistic assessment of decentralisation: who is ready, who is not, and if ready,ready regarding which matters. Consequently, the government is now decid-ing that critical decisions relating to certain aspects of the decentralisationprocess, such as the issue of local governments’ right to borrow funds, will bedeferred.

For the foreign business community, decentralisation raises a number of im-portant issues. For example, some local governments have attempted to ex-tract additional fiscal resources from foreign companies, using decentralisationto justify themselves, even before these governments have been formallygranted increased powers. So far, the central government has helped foreigncompanies to defend themselves from unreasonable demands and to negoti-ate reasonable outcomes with decentralised governmental units. However,problems of this nature are likely to continue and these will undoubtedlyhave a negative effect on the expense and efficiency of these companies’ opera-tions. Thus, the decentralisation process will almost certainly be costly. Whilethe situation is not yet fully under control, the risks to foreign companies,particularly extractive companies, seem to be somewhat more manageablethan these companies may have feared a year ago.

One core decision in the decentralisation programme that has been taken isthat the central government will retain its authority to determine overall policymore or less across the board, while many aspects related to administrationand management will be decentralised. The issue of the extent to which thecontrol of expenditure will be delegated has been under public discussionsince the beginning of the year. Although ‘final’ decisions have supposedlybeen made, it seems likely that further discussions and adjustments will takeplace. For example, those kota/kabupaten that consider their capacity to man-age their new responsibilities too limited, may re-delegate some of these re-sponsibilities back to higher levels of government. However, the process ofdelegation is poorly defined and could be difficult to manage.

Some local governments, such as those comprising the administration of DKIJakarta, probably have sufficient capacity to manage the process ofdecentralisation. However, an apparent government desire to treat alldecentralised units in the same way in order to appear equitable is likely tocurtail the degree to which authority is devolved to local governments ingeneral. The result is that local government units that are ready to proceedare likely to be granted a lower degree of authority than they might haveexpected under decentralisation. For example, such units might not be per-mitted to borrow funds within Indonesia without prior central governmentapproval. The experience of decentralisation elsewhere suggests that allowingsuch borrowing leads to bad choices by some local governments. However,

THAT NOT EVERYTHING WILL HAPPEN BY

1 JANUARY 2000.

LOCAL AUTHORITIES ARE ALREADY TRYING

TO EXTRACT REVENUE FROM FOREIGN

COMPANIES, EVEN BEFORE THESE

GOVERNMENTS HAVE BEEN FORMALLY

GRANTED INCREASED POWERS.

CENTRAL GOVERNMENT WILL CONTINUE TO

DETERMINE MOST OVERALL POLICY,ALTHOUGH MANY ASPECTS RELATED TO

ADMINISTRATION AND MANAGEMENT WILL

BE DECENTRALISED. ALTHOUGH DECISIONS

RELATING TO THE PROCESS ARE SUPPOSEDLY

FINAL, THEY MAY IN FACT BE MODIFIED AT

A LATER STAGE.

SOME LOCAL GOVERNMENTS ARE ALREADY

ABLE TO MANAGE THE DECENTRALISATION

PROCESS, BUT THE GOVERNMENT PREFERS

TO MOVE UNIFORMLY ACROSS THE BOARD.THIS MEANS THAT THE MORE ADVANCED

LOCAL GOVERNMENTS WILL BE HELD BACK

INITIALLY.

27


the constraints that are likely to be imposed on local governments units willalmost certainly hamper initiative and lead to continued over-dependence onJakarta, undercutting the efficiency benefits of decentralised decision-mak-ing.

The major gain over the past year is that most participants now agree that asuccessful decentralisation process will require several years to implement. Ayear ago, there was no consensus between the government, parliament andthe decentralised local government units about the necessary steps to achievedecentralisation and how to carry it out. Discussions with the wider publicabout the issues involved and means of achieving goals had yet to start. Whilethere has been substantial progress in this regard, a defined framework wouldgo further towards generating an increased level of involvement outside gov-ernment circles. Although some public discussion has started on matters re-lated to decentralisation, a broad consensus on fiscal decentralisation has yetto be achieved. Key unresolved issues relate to the roles of parliament and theMPR (People’s Consultative Assembly), which will probably rewrite the rulesregarding the Indonesian decentralisation process over the next year or so,with unpredictable results. The decentralisation process could also be se-verely affected by Indonesia’s turbulent presidential politics. To avoid thisrisk, there is a need for analysis in the public domain to justify the key deci-sions on decentralisation that have been made. As such, the decisions made sofar should be viewed as nearly final, but still potentially subject to majorrevision.

Many measures need to be implemented over the next couple of months inpreparation for a successful soft opening of fiscal decentralisation in Indonesiaon 1 January 2000. The Minister of Home Affairs and Regional AutonomySurjadi Soedirdja, in a speech to the donor community on 13 October 2000,placed fiscal decentralisation in the context of democratisation and discussedthe risks realistically for the first time. Viewed from the perspective ofdecentralisation, the cabinet reorganisation of two months ago was interpretedby many outsiders as suggesting that the pace of decentralisation reform hadslowed. For example, a strong advocate of the decentralisation process, Minis-ter Rias Rashyid, did not receive the key position of Minister of Home Affairsin the new cabinet. However, in his new position in charge of the governmentadministrative apparatus, he still has the capacity to influence key eventsrelated to the process, such as the planned transfer of civil servants from thecentre to the provinces. However, the signals suggest that the major strategyfor implementing decentralisation remains intact, and that the decentralisationprocess will continue, albeit perhaps at a slower pace. The government itselfhas begun to move more rapidly.

The key unresolved factor that affects decentralisation is the reform of themilitary. This relates in particular to a reassessment of the role of the military’sterritorial system and the necessity under current financial constraints for themilitary to raise much of its own budget. Most major foreign companies areusually too large to be pushed around by the military. However, they mustremain on good terms as, on occasion, these foreign companies may need tocall on active military support to help control civil unrest.

WHILE WIDER PUBLIC DISCUSSION HAS

STARTED, THERE IS STILL NO BROAD

CONSENSUS ON THE ISSUES. ROLE OF THE

MPR AND PARLIAMENT IS ALSO

UNRESOLVED, AND IT COULD REWRITE THE

RULES IN THE FUTURE.

DESPITE CONCERNS AFTER THE LATEST

CABINET RESHUFFLE, THE MAIN STRATEGY

OF DECENTRALISATION REMAINS INTACT,ALTHOUGH IT MAY MOVE FORWARD MORE

SLOWLY.

THE ROLE OF THE MILITARY REMAINS AMAJOR CONCERN.


28

The key solution to military reform is the regularising of the financing of themilitary. One strategy to minimise the fiscal costs of this change would be tonationalise military businesses. The funds obtained could be used to formaliseand finance what should become an ongoing government obligation to themilitary—one that the military is currently carrying out informally. How-ever, such a measure would be a very difficult decision for the Indonesiangovernment to implement. Despite the obstacles, until this issue is resolvedit is hard to see how smaller businesses can function outside the major urbancentres with the threat of excessive military rent seeking. In larger cities, suchbusinesses have a certain level of immunity, but outside these areas, wherefuture economic development must occur, such businesses are vulnerable toextortion.

The major management issue facing the government is that for a solution tobe reached, the military must be prepared to accept a reduction in its discre-tionary use of funds. It seems clear that at the present time, not all elementsof the military would be happy to see the implementation of decentralisationgoing entirely smoothly. In the event of a poorly implemented decentralisationprocess, the opportunities for the military to exert power and influence at thelocal level would be uncomfortably high. Regrettably, the process of militaryreform has yet to begin. The major constraint on military reform is that thegovernment is largely dependent on military support to maintain controlthroughout the archipelago at a time when regional unrest is high.

The major budgeting issues relating to the financing of the first year of fiscaldecentralisation seem to be more or less settled. A compromise appears tohave been reached to ensure that major efforts will continue to increase theparticipation of local governments in fiscal decision-making relevant to theirinterests. However, this year is mostly a dry run in which the decentralisedunits have the opportunity to learn what to do. At the regional level, Bappenasand the Bapedas will continue to call the shots for the moment, while crucialexperience is acquired by local governments. Nonetheless, some larger localgovernments will have a more immediate influence on the allocation of re-sources allocated to them.

Issues related to the raising revenue remain unresolved but are moving to-wards resolution. The proposed level of revenue to be provided by the centralgovernment to each kota/kabupaten, as indicated by a formulae based on vari-ous demand factors specified in Law No. 25 (population, per capita income,etc), often fail to match historical pre-decentralisation expenditure levels. Aprovision that guarantees each local government unit at least 80 percent (orsome similar percentage) of its current income will probably be utilised toresolve most of the anomalies. Meanwhile, the formulae design process is stillongoing. However, it is clear that decentralisation will increase fiscal dispari-ties among kota/kabupaten in exchange for increased expenditure efficienciesand reductions in the potential for national fragmentation.

The decentralisation of authority over decisions related to taxation is a nor-mal requirement if responsibility for financial decision-making is to be exer-cised by local government. Significant decentralisation of control over incomeand property taxation is not currently a part of the decentralisation process,

THE ONLY VIABLE SOLUTION IS TO BRING

THE MILITARY ON BUDGET AND SELL OFF ITS

BUSINESS INTERESTS. OTHERWISE, SMALLER

COMPANIES OUTSIDE THE MAIN URBAN

AREAS COULD BE AT THE MERCY OF

MILITARY RENT SEEKING.

THE MILITARY HAS A VESTED INTEREST INSEEING THE DECENTRALISATION PROCESS

FUNCTIONING POORLY.

BUDGETING ISSUES FOR THE FIRST YEAR

SEEM TO BE SETTLED. THE FIRST YEAR

WILL BE A LEARNING PROCESS.

REVENUE ISSUES REMAIN UNRESOLVED AND

THERE ARE LIKELY TO BE ANOMALIES

BETWEEN HISTORICAL EXPENDITURE AND

ACTUAL INCOME.

INCOME AND PROPERTY TAXATION

AUTHORITY IS NOT BEING DECENTRALISED,AND THIS COULD JEOPARDISE LOCAL

GOVERNMENT DECISION-MAKING

29


although there has been a recent announcement regarding a relaxation of acurrent Indonesian law restricting the right of local governments to raise taxwithin their jurisdictions. Local governments with increased authority overexpenditure but insufficient authority over broad-based revenue raising arelikely to find new and ingenious ways of raising funds (potentially a signifi-cant problem for resource extracting companies), or to challenge nationalauthorities. This is a problem that will not go away. Foreign businesses willfind their activities subject to more pressures from decentralised local govern-ments lacking sufficient revenue authority to act in an independent and re-sponsible fashion. The central government hopes that local governments willchoose to act responsibly, but the option to act independently and irrespon-sibly remains. Many of the potentially large efficiency gains fromdecentralisation are at risk until local governments are more able to financethemselves. Without the authority to borrow in a viable municipal bondmarket, or to impose local taxation on property, income, and perhaps sales,hard-pressed local governments could well become overly reliant on tradetaxes.

The potential for local government intervention is still high. While the Min-istry of Industry and Trade appears to be coming to grips with this issue,putting a wide range of local trade taxes into place could have an adverseeffect on Indonesia’s economic growth. The trade-off between the necessityof local governments being able to raise a sufficient volume of revenue andbenefits of retaining a free national market to help Indonesian companiesachieve a sufficient economy of scale to become efficient have not been re-solved. In the US, problems of this nature are prevented by a non-corruptjudiciary, the lack of which remains a grave problem in Indonesia.

The ASEAN Free Trade Area (AFTA) will come into effect in 2002. There is astrong likelihood that Indonesia will not collaborate fully with this effort toimprove efficiency and increase collaboration through reducing tariff barrierswithin ASEAN. The increased level of authority of local governments willmake Indonesian compliance with these new rules even more difficult to en-force. This process has yet to be managed, even at the national level, althoughIndonesian companies afraid of competition from other ASEAN countries arelikely to try to pressure the government into delaying the introduction ofAFTA.

The authority to make policies regarding natural resources remains with thecentral government to a large extent. A reasonable resolution of problemsrelated to this issue now looks likely. However, the process of resolution hasbeen difficult, and these issues will not go away until local governments gaina better revenue base. Moreover, such key issues as the location of naturalresources across kota/kabupaten boundaries are still to be resolved. Most localgovernments with natural resources are looking for new sources of revenue,and problems arising in this area are likely to plague foreign companies formany years.

National government officials will not be transferred to provincial and localgovernments in large numbers immediately after the implementation ofdecentralisation, although the process will begin in 2001. However, provin-

RESPONSIBILITY AS LOCAL GOVERNMENTS

SEARCH FOR INGENIOUS WAYS OF RAISING

SUFFICIENT REVENUE.

THE TRADE-OFF BETWEEN LOCAL

GOVERNMENT REVENUE NEEDS AND A FREE

NATIONAL MARKET HAVE YET TO BE

RESOLVED. THE LACK OF A RELIABLE

JUDICIARY IS AN ADDED CONCERN.

ALTHOUGH AFTA IS DUE TO BE

INTRODUCED IN 2002, THERE ISLIKELIHOOD THAT INDONESIA WILL DRAG ITS

FEET. DECENTRALISATION WILL MAKE

COMPLIANCE EVEN MORE DIFFICULT TO

ENFORCE.

POLICY REGARDING NATURAL RESOURCES

HAS BEEN RETAINED BY THE CENTRE, BUT

PROBLEMS COULD STILL ARISE.

THE TRANSFER OF GOVERNMENT OFFICIALS

FROM JAKARTA TO THE LOCAL

GOVERNMENTS IS BEING RESISTED,


30

cial and local governments will still need to acquire new expertise in account-ing, finance, budgeting, financial management and auditing. In all, perhaps2,500 new experts will be required. National government officials scheduledfor transfer to local governments will pass through a much longer transitionperiod than first planned, if indeed they ever are finally transferred. Therewill therefore be significant double-spending during the transition. This fi-nancial burden will be difficult for Indonesia to deal with, given the country’sbudgetary constraints. The government understands the problem of fiscalsustainability, but has accepted that this costly transition is unavoidable.

Substantial additional training is required to ensure that the necessary hu-man resources will be available at the local level within the next five years.The delay in the availability of these resources is a significant flaw. The re-quired training has not yet been financed, and will be a major drain on thedevelopment budget. The salary costs of these new officials will necessitate asignificant rise in government expenditure as a share of GDP. Issues related tothe transferring of current officials and financing of the hiring of new officialsto implement the necessary tasks remain contentious, although they will prob-ably be resolved over the course of 2001.

Decentralised debt-finance by provincial and local governments is being ad-dressed in government regulations, but it appears that the central govern-ment will not permit most local governments to borrow independently of thenational government. While it is understandable that Indonesia might de-cide not to permit many local governments to borrow within Indonesia, thiswill limit those that are ready to borrow responsibly.

A decentralisation that achieves increased efficiencies will require substantialsupport and participation from the non-profit sector. Some of the non-profitinstitutions necessary to support this process are already playing a major role.These are key institutions to help make decentralisation work, and they willneed to be strengthened. It would be helpful, therefore, if the new intergov-ernmental forum were not to continue as a creature of the national govern-ment, but had a more direct relationship with parliament.

One matter of significance to the foreign business community that is notbeing addressed in accord with standard international practice is the issue oflabour management relations. The control of policy relating to labour man-agement relations is being retained by the central government, which is con-sistent with international practice. However, the administration of labourmanagement relations is being delegated to local governments underdecentralisation. This solution is not in full accord with international prac-tice.

In the US, for example, the National Labor Relations Board (NLRB), anindependent national government body that reports to Congress, makes ad-ministrative judgments about the complex procedural issues that arise be-tween American labour unions and management. Such issues that arise be-tween the two groups are not addressed by the NLRB until after union griev-ance procedures with management have failed to resolve the problems. It isdifficult to see how the additional differences that decentralised decision-

PROLONGING THE TRANSITORY PERIOD.CONSEQUENTLY, NEW EXPERTISE WILL HAVE

TO BE HIRED AT SIGNIFICANT ADDITIONAL

COST.

TRAINING OF NEW PERSONNEL WILL TAKE

FIVE YEARS AND HAS YET TO BE FINANCED.THIS PROLONGED LENGTH OF TIME IS AMAJOR FLAW.

IT IS UNLIKELY THAT LOCAL GOVERNMENTS

WILL BE PERMITTED TO BORROW MONEY.

DECENTRALISATION NEEDS SUPPORT FROM

THE NON-PROFIT SECTOR. THESE

INSTITUTIONS NEED TO BE STRENGTHENED

AND PARLIAMENT SHOULD BE ENCOURAGED

TO BECOME MORE INVOLVED.

ADMINISTRATION OF LABOUR MANAGEMENT

RELATIONS IS BEING DECENTRALISED,UNLIKE THE PRACTICE IN MOST OTHER

COUNTRIES.

THIS COULD CREATE PROBLEMS, ESPECIALLY

IN VIEW OF THE WEAK LEGAL SYSTEM.

31


making will add to this process can be resolved—even in a US context wherethere is a responsible non-corrupt legal system. Furthermore, Indonesia hasnot yet put in place anything like the complex procedures that make the USlabour management system workable. The only way for labour managementrelations to function under something approaching the US model would befor Indonesia to decide not to decentralise all the administration and man-agement of its evolving labour relations system.

ConclusionThe bottom line for Indonesian decentralisation is that the efficiency gainsbrought about by the combination of increased democracy and decentralisationshould still be fully available in the longer term. However, the initial intro-duction of the process still seems difficult, and much more needs to be done:the involvement of parliament has not been obtained; foreign investment inIndonesia is at risk until investors with other choices believe that the Indone-sian system, including both decentralisation and the local government deci-sion-making system, will permit successful company operations; the military‘wild card’ needs to be brought under control; and certain decentralisationdecisions on the expenditure side may have gone too far, while some decisionson the revenue side probably have not gone far enough. Both of these latterproblems will create difficulties for foreign companies.

Given Indonesia’s overall government circumstances, it is hard to be too opti-mistic that all that needs to be done will be completed in a timely fashion.Further adjustments in the law and regulations are likely to be needed. None-theless, it is worth remembering that the US government has been involvedin such a process for about 200 years, and it still finds good reason to con-tinue to be concerned with such issues.r


32

POLITICAL/ECONOMIC BRIEFS

Political Briefs

UN team to visit West Timor in No-vemberAccording to the government, a del-egation from the UN Security Coun-cil will be permitted to visit WestTimor in mid-November to evaluateprogress in disarming the militias andregistering those refugees who wish toreturn to East Timor. Indonesia re-fused to allow a visit last month, inthe weeks following the murder ofthree unarmed UN humanitarianworkers in the West Timor bordertown on Atambua.

A 47-man government team report-edly left Jakarta bound for the prov-ince in mid-October, comprising gov-ernment officials and members ofTNI and Polri (national police). Theteam has been assigned to work fromAtambua for the next three months.In the absence of any UNHCR offi-cials in the province following thetragic events of September, this teamis tasked with registering refugees inthe camps prior to their relocation orreturn to East Timor.

Coordinating Minister for Political,Social and Security Affairs SusiloBambang Yudhoyono has said thatwhen the UN team arrives it will beable to observe the registration of refu-gees and inspect the arms collectedfrom the militias. According toYudhoyono, the Indonesian authori-ties intend to re-register the refugeesin early November and allow them to“choose freely” whether to return toEast Timor or be resettled in otherparts of eastern Indonesia.

However, Human Rights Watch, aNew York-based human rights group,has issued a statement calling for theIndonesian administered registrationto been stopped, saying that there was

no guarantee that refugees will be freefrom intimidation and able to make afree choice.

Yudhoyono also stated, rather vaguely,that between 41 and 91 percent ofthe militias’ weapons had been seized.He went on to claim that Indonesiahad fulfilled the requirements of theUN Security Council resolutionpassed two days after the murder ofthree aid workers in Atambua. Thedisarming of the militia came to aclose on 10 October, having yieldedonly 85 standard rifles, although some1,100 home-made guns were col-lected. Police have also stated that theinvestigation into the murders of thethree UN aid workers was close tocompletion, and that the police hadsufficient evidence to prosecute sevensuspects.

In view of the fatal shooting of a thirdmilitiaman by New Zealand peace-keepers on 25 October well inside EstTimorese territory, Indonesian govern-ment claims that the militia groupshave been disarmed and disbandedseem dubious.

Militia leaders claim their lives are indanger from the militaryIn a surprising development, fourformer leaders of pro-integration mi-litia groups in West Timor have writ-ten a letter to the UN Security Coun-cil offering to reveal everything theyknow about the violence surroundingthe East Timor vote for independence,in return for a guarantee of safety. Thefour say that the Indonesian militarytried to assassinate them in an attemptto ensure that they would not revealthe true facts about the Indonesianarmy’s involvement in the campaignof violence and intimidation. Theyalso alluded to knowledge of thearmy’s complicity in the killings ofthree UN relief workers in the border

town of Atambua, West Timor, inearly September.

The four leaders are seeking guaran-tees not just for themselves but for 54of their associates, including theformer Aitarak militia leader, EuricoGuterres. Guterres seems to be find-ing his own relationship with the In-donesian authorities more amenable,especially following his release frompolice detention on 26 October.

While there may be a few cracks ap-pearing in the previous discipline andsolidarity among militia leaders, itwould be surprising if the Indonesianmilitary were unable to reassert itsinfluence over the wayward militia-men. Members of the Indonesianmilitary (TNI) are likely to exert con-siderable pressure in what is after allan internal affair. If not, then thiscould have serious implications forsenior officers in TNI who were in-volved in operations in East Timor inthe build-up to the referendum in1999.

Court orders the release of GuterresFollowing a ruling by the SouthJakarta District Court, the police wereordered to release the notorious pro-Indonesia militia leader EuricoGuterres on 24 October, on thegrounds that he had been wronglyarrested on 4 October. As we suggestedin our previous issue, the release ofGuterres seemed to be inevitable, giventhe public support he had receivedfrom prominent politicians, includ-ing Akbar Tandjung (speaker of theDPR) and Amien Rais (speaker of theMPR), but that any decision wouldprobably wait until after the CGI(Consultative Group for Indonesia)meeting in Tokyo. However, as we goto print, the status of Guterres appearsunclear. Although apparently free, hehas now sought police protection and

33


remains in the safe house that hadbeen used for his previous house ar-rest during his final weekend in cus-tody—a luxury residential complexused by senior police officers at po-lice headquarters.

President Wahid admits to meetingwith Tommy SoehartoPresident Wahid has confirmed thathe met with Tommy Soeharto in earlyOctober, following the court’s an-nouncement of Tommy’s 18-monthjail sentence for corruption. Tommywas found guilty of causing Rp 95.4billion (US$11,2 million) in losses tothe state in a land-swap deal betweenthe State Logistics Agency (Bulog) andthe Goro supermarket chain, jointlyowned by Tommy and his then busi-ness partner Ricardo Gelael.

Although the president has stressedthat he had no intention of makingany deal with Tommy and that thematter lies with the Supreme Court,the fact that such a meeting took placeat all would suggest that the presi-dent is not happy to let the matterrest with the courts. In fact, there arerumours of two meetings, at least oneof which was attended by Tommy’selder sister, Siti Hardiyanti Rukmana.If true, this suggests that members ofthe former first family are looking tostrike a deal with the president, pre-sumably offering to return some oftheir allegedly ill-gotten wealth inreturn for dropping the legal movesagainst members of the family. Thefact that Wahid should be involvedin clandestine meetings with a con-victed criminal is highly dubious, andsays little for the president’s respectfor the due process of the law. In ad-dition, the president also runs the riskof creating another source of conflictwith parliament, since the MPR haspassed a decree requiring the presi-dent to bring to court all those sus-pected of serious crimes of corruption.Failure to do so will give the DPR

further ammunition should it wish tocall a special session of the MPR topush for the president’s impeach-ment.

Suwondo questioned, says presidentnot involvedIn what could become a crucial casein President Wahid’s political career,Alip Agung Suwondo, the president’sformer masseur, was questioned bypolice for eight hours on 24 Octoberregarding Rp 35 billion that Suwondoclaims to have “borrowed” from thenational State logistics Agency(Bulog). Despite an official receiptfrom Bulog showing Suwondo’s sig-nature and title as ‘the president’spersonal assistant,’ together with evi-dence that the money was subse-quently transferred to a variety of po-litical and business people, Suwondostuck to his story that he had borrowedthe money for his own use.

In a previous court hearing of the case,the former deputy chief of Bulog,Sapuan, had stated to police thatSuwondo had demanded the moneyon behalf of the president for a hu-manitarian project in the troubledprovince of Aceh. The evidence so faris hardly encouraging from thepresident’s point of view, despite thecurrent denials by both Suwondo, andnow Sapuan himself. Currently, a 50-member committee drawn from thevarious factions in the DPR is inves-tigating the case and will decide ifthere are sufficient grounds to takefurther action against the president.

Major police reshuffle announcementtriggers speculation over the motivesA major reshuffle of Polri (NationalPolice) officers was announced on 17October, involving 31 mid- to high-ranking officers. Most notable amongthe moves was the promotion of IrianJaya police chief Brig Gen SilvanusYulian Wenas to head police patroloperations, and the transfer of the

Jakarta police chief Insp Gen Nurfaizito the position of head of the NationalPolice Training Centre.

The transfer of Brig Gen Wenas comesone week after the violence at Wamena,Irian Jaya, following the change in thegovernment’s policy towards the fly-ing of separatist flags in the province.Wenas is replaced by Insp Gen F. X.Soemardi, former head of the policeacademy, and a Catholic from Cen-tral Java. In an interview with the VanZorge Report on 18 October, Wenassaid that he had no intention of al-lowing people to be killed over “a pieceof cloth,” a reference to the deadlinefor removing separatist ‘Morning Star’flags from flagpoles across the prov-ince. Wenas was widely respected inthe province for his conciliatory ap-proach and his attempts to open up adialogue with local leaders in orderto avoid confrontation. It may be thatthe government was uncomfortablewith this openness to discussions withPapuan leaders, and felt a new manwas needed to implement Jakarta’s newhard-line policy towards separatistsentiments in the provinces. Nonethe-less, in his last few days in the job,Wenas has announcement that thedeadline for removing all separatistflags (which had been previously setfor 19 October) would be postponed.

Meanwhile, the transfer of Nurfaizito head up police training could beseen as a measure to remove him fromactive duties in the field. Nurfaizi isreplaced by Insp Gen MulyonoSulaeman, former deputy assistant oflogistics at police headquarters.

Interestingly, there are rumours thatthe move was made as a result of thearrest of Suwondo, President Wahid’spersonal masseur and co-founder ofan airline called Awair, who is impli-cated in the National Logistics Agency(Bulog) scandal (see previous story).Many observers believe that the po-


34

lice knew Suwondo’s whereabouts eversince the scandal first broke, but haveonly now made any attempt to arresthim. If this is so, then the arrest couldhave been encouraged by variousgroups within the DPR in an attemptto increase the pressure on the presi-dent. Suwondo received a disburse-ment of Rp 35 billion from Bulog’semployee foundation, and an officialreceipt indicates that he aked for themoney in the name of the president.

Papuan leaders promise no more vio-lenceWith the deadline for the removal of‘Morning Star’ separatist flags havingpassed without any violence thanks tothe police decision to postpone anyshowdown, Theys Eluay, head of thePapua Presidium, has promised thatthere will be no more bloodshed.Eluay was in Jakarta last week wait-ing to have talks with PresidentWahid on ways of diffusing the ten-sion surrounding the flag issue. Eluayis quoted as saying that if the flagshad to come down, it should be donein a “decent way.” The question iswhether members of the separatistSatgas Papua taskforce will see thingsin the same way as their leader. Twoseparatist flags remain aloft in the pro-vincial capital of Jayapura, while manystill fly in towns outside the capital,most in violation of the president’sconditions that the national flag hadto flag alongside and higher than theMorning Star flag.

Meanwhile, Yorrys Raweyai, thepresident of Pemuda Pancasila (seeinterview on page 19) and a contro-versial member of the Papua Pre-sidium Council, headed by TheysEluay, has said that the central gov-ernment should pay more attentionto development in Irian Jaya as ameans of reducing separatist senti-ment in the province. However,Yorrys also said that he wanted IrianJaya to remain a part of Indonesia.

Yorrys was born in the province andlived there until the age of 28, atwhich point he moved to Jakarta. Theinvitation from the Presidium to bringYorry’s into the group has caused con-siderable controversy in view of hispast associations with Soeharto andPermuda Pancasila, and done little tolegitimise the cause.

Results of Presidium meeting withPresident Wahid disappointingPresident Wahid finally met withPapuan Presidium leader Theys Eluayon 23 October following the policedecision not to enforce the removal ofseparatist ‘Morning Star’ flags fromthe province after the 19 Octoberdeadline for their removal had passed.Also present at the meeting was YorrysRaweyai (see above). Yorrys is quotedas saying that the president had askedthat the Presidium change the mean-ing of the flag in the eyes of the Papuanpeople, something which the Pre-sidium members had said would beimpossible. A compromise appears tohave been reached in which a jointteam will be established comprisinggovernment and Presidium membersto search for a way to resolve the issue.

Following a cabinet meeting on 26October, Cabinet Secretary MarsilamSimanjuntak said that PresidentWahid had decided that the flagcould no longer be used a symbol ofPapuan aspirations and that Papuansshould find an alternative culturalsymbol.

Military personnel withdrawn fromSoeharto’s residenceIt seems that President Wahid was notentirely joking when he said on a re-cent overseas trip that student dem-onstrators should be allowed access toJl Cendana, the leafy street in centralJakarta on which Soeharto and mostof his family live. Since the secondweek of October, all military unitsassigned to guard the former

president’s residence have been re-moved, and any further disturbancewill have to be dealt with by the po-lice. Soeharto and his family previ-ously received special military protec-tion in the two and a half years sincethe former president stepped down.

In the event of serious demonstra-tions, the police have the option ofcalling for assistance from the mili-tary. However, as we pointed out inour previous issue, there seems to bea sense of rivalry between the armyand the police to the extent that thepolice might prefer to deal with anydisturbances single-handed. It will beinteresting to see how they cope withthe challenge.

Intelligence agencies to be overhauledIn separate announcements by Coor-dinating Minister for Political, Socialand Security Affairs Susilo BambangYudhoyono and Minster of DefenceMahfud M.D., the government haslet it be known that its non-militaryintelligence coordinating agency, theState Intelligence Coordinating Board(Bakin) will be renamed the NationalIntelligence Agency (BIN) and givenmore responsibility than its forerun-ner. In comments that seem to indi-cate a third intelligence agency is re-quired, Minister of Defence MahfudM.D. also spoke of creating an entirelynew intelligence network under theMinistry of Defence, to supply “ac-curate information” to the govern-ment. His reasoning seems to be thatthe Ministry of Defence no longer hasadequate access to military intelli-gence, from TNI’s intelligence service,the Strategic Intelligence Agency(Bias). However, observers are puzzledas to why a third agency should benecessary when the existing Bakincould be improved to supply infor-mation to the Ministry of Defence.

In subsequent comments, PresidentWahid has indicated that there has

35


been too much overlap between thetwo organisations, and that from nowon the military’s Strategic IntelligenceAgency (Bias) should concern itselfonly with military matters and nolonger handle political issues. Thiswould seem to contradict the need fora third agency.

One question to be asked here iswhether the changes are aimed at re-forming and democratising the exist-ing intelligence agencies, or simplyincreasing their influence in assessinginternal threats to the security of In-donesia. One indication of this willbe whether any new agency would bestaffed by civilians or military person-nel. If the latter, then public suspi-cion of the murky underworld of theIndonesian intelligence is unlikely tobe allayed. In the public eye, thecountry’s intelligence agencies arewidely seen as being responsible forengineering incidents that then cre-ate a pretext for acting against ‘unde-sirable elements’ in society.

Minister Mahfud’s comments on es-tablishing a new intelligence networkhave some observers worried, while themore recent statement from the presi-dent suggesting a scaling back of themilitary’s involvement in monitoringpolitical issues augur well.

Syarwan Hamid named a suspect inattack on PDI officeWhile the investigations into humanrights abuses in East Timor in 1999and the subsequent court cases seemto have all but run out of steam, thecase against senior officers allegedlyinvolved in the July 1996 attack onthe PDI headquarters continues tomake the headlines. On 16 October,former Home Affairs MinisterSyarwan Hamid was named a suspectin the attack. Syarwan was head of themilitary’s social and political affairs

department at the time. He now joinsJakarta governor Sutiyoso on the listof suspects.

Sutiyoso, who was Jakarta’s militarycommander when the attack tookplace, admitted earlier this year thatthe order to attack the headquartershad come from former presidentSoeharto. At the time of the attack,which triggered serious rioting in cen-tral Jakarta and left at least five dead,the government maintained that it wascarried out by supporters loyal to PDIleader Soerjadi. This version of eventsis not generally accepted, sinceSoerjadi had been elected by a gov-ernment organised PDI conference,and his ‘loyalists’ were reportedlyhired thugs.

Raining HawksFor the third time since June, and thesecond time in a fortnight, a British-built Indonesian air force Hawk jetfighter has crashed, on this occasionin Pontianak, West Kalimantan, kill-ing both the pilot and the co-pilot.The fighter was on a routine trainingflight. The Indonesian air force pur-chased 32 Hawk 100 and 200 fight-ers in 1995, which means that it haslost almost 10 percent of its Hawkaircraft over the past five months.While comments in the local presssuggest that the string of accidentswas a result of difficulties in obtain-ing spare parts due to an embargo onmilitary supplies, in fact the armsembargo affecting EU countries waslifted back in January 2000. The In-donesian air force is investigating theaccidents but it seems that pilot erroris the most likely cause. However,while the EU may have lifted its armsembargo, to the annoyance of the In-donesian military, the US embargoremains in place. All Hawk 100 fight-ers have been grounded since this lat-est accident. An air force spokesman

was quoted as saying that none of theHawks were insured.r

Economic Briefs

President Wahid delays legal proceed-ing against three top businessmenIn an announcement that has beengreeted with widespread dismay,President Wahid has said that legalproceedings against three top busi-nessmen will be delayed as their rolein boosting exports and contributingto economic recovery is vital. Thethree businessmen involved are:Marimutu Sinivasan of the TexmacoGroup, Prajogo Pangestu of the BaritoGroup and Sjamsul Nursalim of theGadjah Tunggal Group. Together theyare responsible for causing massivelosses to the state. The move has sincebeen described by Attorney GeneralMarzuki Darusman as resulting fromthe rescheduling of the three tycoons’debts with IBRA. However, the movehas created an outcry, with the presi-dent being accused of collusion andan unwarranted intrusion into thejudicial process.

Bomb explodes at Newmont’s officein LombokA small bomb exploded at the officeof PT Newmont Nusa Tenggara, inthe West Nusa Tenggara provincialcapital of Mataram on the island ofLombok on 13 October. Newmontoperates a copper and gold mine inthe Batu Hijau region of WestSumbawa. There was only minor dam-age, and no casualties were reported.Following the incident, the speaker ofthe provincial assembly was quoted assaying that the attack could have beendue to local people’s disappointmentwith the benefits they had received asa result of the mining operations inSumbawa.r

Documents

VOL O OVEMBER - papuaweb.orgpapuaweb.org/net/golden/vanzorge-2000-vol2-18.pdf · van zorge report on indonesia c o m m e n t a r y & a n a l y s i s o n i n d o n e s i a n p o l