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Professor M.C. Ricklefs
Indonesia in late April 2001 was challenged by facing long-term, medium-term and short-term crises.
The long-term crisis was the consequence of four decades of authoritarian and increasingly corrupt and dysfunctional government. As the population grew, competition for resources inevitably increased. Economic development provided new resources, new standards and new aspirations, but when it faltered in the wake of the financial, economic and political crisis of the late 1990s the population was left with a major gap between aspirations and possibilities. No real progress has been made in closing that gap: Jakarta shows all the outward indications of resumed economic life, but there is very little new investment and in the countryside many areas suffer from the consequences of economic collapse. A crisis may be looming in some areas for rice farmers, whose crops the government simply fails to buy at the agreed price.
Social problems are expressed, inter alia, in widespread violence: across religious lines in some areas, across ethnic divisions elsewhere, sometimes between groups distinguished neither by religion nor ethnicity. Thousands have died in such violence in the last two years. Chronic social violence and widespread criminality are likely to be a feature of Indonesian life for the foreseeable future.
At the root of this long-term crisis is not, in fact, the economy but a failure of governance. The institutions of governance were corrupted for political and personal advantage by the governing elite from the late 1950’s. The Soeharto regime was one of the most corrupt in the world. There is little progress in rehabilitating the institutions of governance or the assumptions and conventions which underlie them in successful democracies. In particular the rule of law is corrupted from top to bottom. Some of the most flamboyant corruptors of the Soeharto era have been brought to trial, convictions have followed; and more are likely to do so. But justice is for sale in Indonesia and, reflecting the absence of popular faith in the courts, vigilante law reigns in the streets.
The medium-term challenge is whether the institutions of Indonesia’s fragile democracy can survive until the next general elections, which are scheduled for 2004. If the populace can come to believe that the political parties are able to represent their interests and that the law is able to defend them, then there is a chance that democracy will succeed. It needs to be remembered that every transition from authoritarianism to democracy around the world in recent decades has been marked by much confusion, conflict and despair in the early stages. But is also possible that democracy will collapse again in Indonesia, as it did in the 1950s, because it fails to represent ordinary people or to address their problems and thereby discredits the very idea of democracy.
The short-term challenge is whether President Abdurrahman Wahid, in order to defend himself from impeachment by his enemies in parliament, will allow – indeed encourage – fanatics among his followers to come to Jakarta to intimidate the parliament. He claims that 400,000 have sworn to fight to the death to defend him, in a cause they regard as equivalent to jihad (Holy War). Another Islamic group says it is prepared to fight Abdurrahman’s supporters.
WATCHPOINT: Observers who recall the role that the fanaticism of some Islamic groups has played in bloody social violence in the past, fear that it may do so again.
About our company:
AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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