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Indonesia News Digest 27 – July 17-23, 2007

News & issues

Demos, actions, protests... Aceh West Papua Human rights/law Labour issues Environment/natural disasters Health & education Elections/political parties TNI/defense 10 years after the economic crisis Economy & investment Opinion & analysis Book/film reviews

 News & issues

Ratna Sarumpaet: The agony of a senior director

Jakarta Post - July 24, 2007

Kanis Dursin and Alia, Jakarta – With more than 20 plays under her belt, you would think senior director Ratna Sarumpaet would have no problem finding investors for her film, particularly if the proposed production was a big screen adaptation of her play that won rave reviews.

That does not seem to be the case however for the founder of Satu Merah Panggung (One Red Stage) theater group. For the past few months, the actress has been looking in vain for investors willing to foot the bill for her first ever motion picture.

"We have cast our nets everywhere and are still waiting for responses from possible investors," Ratna told The Jakarta Post early this month.

She did not give away who she had approached for the production of Pelacur dan Sang Presiden (A Prostitute and The President), a silver screen adaptation of her play Jamilah dan Sang Presiden (Jamilah and The President).

Pelacur dan Sang Presiden, which Ratna plans to release in conjunction with Human Rights Day on December 10, delves into the problem of human trafficking – a burning issue in a country of 220 million people.

The director-cum-activist said some 200,000 children are being trafficked and sold across the archipelago every year due to extreme poverty and a lack of education.

She said "people of all ages have to understand the gravity of the problem". "Such practice (human trafficking) is found in all regions and that is the reason why I don't single out any place in the film," said Ratna.

In preparation for the film, the actress undertook field research and interviewed workers and victims of the sex trade in many regions and cities including Batam, Solo, Surabaya, Kalimantan and Indramayu.

Her strong desire to make the public more aware of the problem – including its root cause – has prompted her to take the issue to the big screen.

"This is a campaign and as a campaign, I will do anything I can to promote this film so that all people watch this film and in turn make a profit for investors," she said. "I feel it's very important that this film gets screened widely. I hope it will open the minds of Indonesians to some of the real issues that are troubling our community today."

As noble and idealistic as her desire may sound, the film has until now failed to win the heart of Indonesian investors. So far only one company – and ironically a foreign company – has shown interest in the production.

"They (prospective investors) always say that this (project) is great and important, but they become apprehensive when we talk about financing," she said, adding that one investor even told her to make a film for teenagers instead. "I told him that this film is for people of all ages, including teenagers," she said.

Ratna said she was well aware the film industry has been obsessed with themes of horror, mysticism and teenage romance. However, she believed it was time for the mature cinema-going public to be presented with weightier offerings.

"If we look at Indonesia's film industry, we can never predict what kind of films would make money. There are so many horror, mysticism and teenage romance movies that failed to make profit," she said.

"Likewise, there is no guarantee Pelacur dan Sang Presiden will succeed, but that is how the film industry works... there will always bee a chance," she said.

Ideally, Ratna said, the country's film industry should provide education and entertainment. She said it was sad the industry focused so much on entertainment.

"Is it really true that we get entertained when we see ghosts everyday?" she said. "Those (ghost) programs are not educating (anyone)," said Ratna, who turned 59 last July 16.

Ratna is no stranger to stage or screen. She started her career in 1991 as director of the television show Rumah Untuk Mama (House for Mother) on state-owned TVRI.

She is a 16 year veteran of the theater and her work has been internationally honored. In 1998 she was awarded the Female Human Rights Special Award from the Asia Foundation for Human Rights in Tokyo.

Ratna said she had become despondent about the way the sex industry operated in Indonesia. She claimed the root of the problem was poverty and stupidity. These two factors affect both the prostitute and her client. This was proven, she said, by surveys and interviews she undertook in five major cities across Indonesia.

The other issue of serious concern raised by Ratna, and that Indonesia seems unable to fix, is trade in child trafficking. For the film-maker this is a moral issue and the solution should be the responsibility of all citizens.

"For me the sex industry is a tragedy; I find it particularly painful because Indonesia is a religious nation," she said.

"Everything in this country is connected with religion. You can't even spit without someone coming out to demonstrate. Not one child born in Indonesia should ever have to work in prostitution.

"For me, there's an obligation on mothers, and all who work in pesantren (Islamic schools, usually with boarders), to appreciate the issues.

"Because faith and religion are so important, children need to be aware from an early age. It could be said that this film is a campaign to raise awareness.

"And not just parents, but teachers and caregivers. There's also a message here for the authorities.

"The government knows that every year around 20,000 children under one year are traded in this republic. In some regions children up to five years of age are sold and that's not considered unusual.

"Our laws are weak. So this film is a campaign to raise awareness of the sex industry."

The film would be strengthened by some big names in local cinema, including Atiqah Hasiholan (Jamila), Christine Hakim (Ria, Sipir), Tio Pakusadewo (Soleh), Marcelino Lefrandt (Arthur) and Jajang C Noer (Mrs Wardiman) and Luna Maya (journalist).

It's interesting this is the first time Christine Hakim has played the role of an antagonist.

"But the antagonist in my film doesn't terrify like a ghost," Ratna said. "She always demands that humanity must be recognized."

"When I make a film, an antagonist isn't very wicked or bad or evil. There is still a human side to their character."

Education the best counter for radicalism

Jakarta Post - July 19, 2007

Muhammad Wildan, Singapore – The spread of radical Islamism in Indonesia has led many people to assume that it has to do mostly with the incorrect interpretation of Islam. Although this assumption may not be totally incorrect, this judgment is misleading. For some people, this could lead to theological accusations of Islam.

Rather, I tend to argue that, in fact, religion, including Islam, has been misused to frame people's disappointment with the state. I share the view of Olivier Roy (2004), who insists that along with global factors, the emergence of radical Islamism is mostly shaped by local peculiarities.

Modernization and globalization are mainstreaming across the world, including in some predominantly Muslim countries. Regardless of some advantages of these mainstreams, in general they have some disadvantages. Indeed, modernization and globalization have marginalized the role of religion. In the Indonesian context, Islam has lost its social authority.

The rise of radical Islamism, however, has not directly connected with Islam as a religious and social system. A number of studies on radical Islamic boarding school (pesantren) also conclude that there is nothing wrong with the Islamic teachings at some pesantren accused of breeding radicals.

In my view, the inability of religious followers to face modernity eventually leads them to such radicalism. Therefore, it is the task of the government to let all Muslims get involved in the mainstream.

The return of some Muslims to salafism (which advocates Muslims to return to the Koran and Hadith), in a way, is a sign of Muslims' rejection of modernity and globalization. It is the ideology of salafism that restricts the access of Muslims to modern values. Therefore, only higher education can accelerate Indonesian Muslims' move to moderation.

Those who opt for radical Islamism mostly share relatively narrow-minded views. Most of them had no chance to attend university. In many ways, this situation has confined their way of thinking to a single point of view. The limited number of books or knowledge resources, to some extent, has also restricted their insights.

The difficulties in comprehending current phenomena of modernity and the globalized world have forced some Muslims to look back to the traditional values of Islam. Salafism, the belief of Muslims during an earlier period of Islam, is perceived as the best generation of Muslims. They believe returning to salafi will help them regain their heyday. Undeniably, most radical Islamic groups, including those committed to violence, have embraced salafism.

One of the most crucial issues among these people is the notion of darul Islam (state of peace) and darul harb (state of war). For those who have embrace salafism this dichotomy is the best way to comprehend current social and political problems.

In addition, the inability of the Indonesian government to cope with social problems in the last 10 years also has convinced some Muslims of the necessity of sharia.

Along with demands for sharia ordinances in some regions in Indonesia, some Islamists have resorted to violence to achieve their goals. In many cases, the violence involves those having narrow-minded views.

For this reason, the government should not blame Islam for promoting radicalism. Rather, it should provide good and affordable higher education for all. It is only through education that modernization can be viewed as a positive aspect of life, instead of a threat.

Muslims, like other citizens, need higher education to broaden their minds in the era of globalization. Secondary school is no longer enough for them to cope with modernity and the complexities of the global world. Higher education will reduce cultural conflicts between traditional Islam and modernity, and therefore curb radicalism.

Education will not only help Muslims comprehend modernity, but also to take part in the mainstream and lead modernization itself.

In this case, I disagree with Olivier Roy, who says that Islam cannot choose the form of its own modernity. Indeed, modernization is becoming an integral part of life and it is not necessary for Muslims to avoid modernization, but they can pick their own type of modernity that fits traditional and religious values.

In this respect, I do agree with Mahmood Mamdani (2004), who states that a "culture talk" between Islamic values and Western modernity would generate a distinct type of modernity. However, it will not materialize unless Muslims enjoy good education.

[The writer is a lecturer at Sunan Kalijaga State Islamic University, Yogyakarta. Currently, he is a fellow at the Asian Research Institute at the National University of Singapore. He can be reached at wildan71@yahoo.com.]

Indonesia: Military threatens to crush 'separatists'

Green Left Weekly - July 18, 2007

James Balowski, Jakarta – Coinciding with the release of a report by Human Rights Watch exposing endemic human rights abuses in West Papua and the refusal to allow a member of the US Congress to visit the province, protests featuring the Morning Star flag were held.

The first protest took place on July 3 when a dancer unfurled a Morning Star flag during the opening ceremony of a four-day conference of the Papuan Traditional Council in the provincial capital of Jayapura. As well as being a traditional West Papuan symbol, the Morning Star is also the symbol of the Free Papua Movement (OPM), which has been fighting a low-level insurgency against Indonesian rule since the 1960s.

The following day, the Antara News Agency described the situation as tense, with a much larger than usual police presence on the streets. Eight people were arrested after the conference closed (although they were subsequently released).

The protest followed on the heels of an incident in the city of Ambon in Maluku on June 29 in which a group of uninvited dancers managed to sneak into an event commemorating National Family Day and unfurl a South Maluku Republic (RMS) separatist flag in front of President Susilo Bambang Yudhoyono and official dignitaries. Thirty people were later arrested.

Since then, there have been reports suggesting that security agencies were aware of the planned protest but allowed it to go ahead. This has raising speculation that elements within the TNI (Indonesian military) or police intentionally sought to embarrass Yudhoyono in order to push the government to give them a freer hand in dealing with separatism.

The Jayapura conference was to have been attended by Eni Faleomavaega, a Democratic member of the US Congress, but at the last minute the government refused to give him permission to go to Papua, saying his presence could "spark riots and encourage violence".

No doubt fresh in the government's mind was a one-day visit to Jayapura in early June by UN envoy Hina Jilani, which was greeted by hundreds of protesters calling on the UN to put pressure on Jakarta to overturn the 1969 referendum that resulted in West Papua's integration into Indonesia, and is widely seen as a sham.

On July 4, police broke up a rally by some 50 demonstrators from the United West Papua Popular Struggle Front (F-Parera-PB) in the Central Java city of Yogyakarta after they unfurled a Morning Star flag. Marching from their dormitory in the direction of the central post office they carried banners reading "Referendum yes" and "Autonomy no", and wore headbands and masks with the Morning Star symbol.

The students also unfurled a banner depicting Yudhoyono and Vice-President Jusuf Kalla as US puppets and demanded an investigation of rights abuses in the province.

The march was eventually halted by about 200 police, who told them they would only be allowed to continue if they left the Morning Star banners behind. After lengthy negotiations the students returned to their dormitory where they removed chairs and tables and blockaded the road for several hours.

The following day, around 100 Papuans demonstrated in front of the US Embassy in Central Jakarta wearing T-shirts with pictures of the Morning Star. Although closely guarded by police, no attempt was made to break up the rally.

According to the Detik.com, later in the day police launched a sweep for indigenous Papuans living in the nearby area of Tanah Abang.

On July 7 in Yogyakarta, the right-wing Unitary State of the Republic of Indonesia Defenders Front (FP-NKRI) said that it was planning to conduct sweeps in the city and surrounding areas claiming that the TNI and police are no longer capable of dealing with separatism.

According to a July 10 statement by the Institute for Papuan Advocacy and Human Rights, West Papuan activists say that extremist elements have already started threatening Papuan student activists involved in the demonstrations. Some 45 student leaders in Yogyakarta have fled their dormitories and gone into hiding following statements issued in the mass media by hardline Islamic and nationalist organisations the Islamic Defenders Front (FPI) and the Indonesian Anti-Communist Front (FAKI). Over the last year both organisations have been involved in a series of premeditated attacks on the leftist Indonesian Liberation Party of Unity (Papernas).

Seemingly unwilling to respond to what a July 5 Jakarta Post editorial described as "further evidence that disenchantment with the central government is genuine", sections of the regime have instead sought to blame foreign parties.

Speaking at a discussion titled "Beneath the shadow of separatism" in Jakarta on July 7, the former head of the Trikora regional military command (which oversees West Papua), retired Brigadier General Rustam Kastor, claimed that foreign intelligence agencies are playing a significant role in the re- emergence of separatist movements.

"The people of Maluku are satisfied with Indonesia. In Papua the people also don't understand separatism. What is happening is that certain people in these two regions are being used by foreigners for their own interests", Detik.com quoted him as saying.

Although saying separatism is a consequence of the government's failure to bring prosperity to these regions, legislator Ali Muchtar Ngabalin said he was "100 per cent convinced" that foreign actors were behind the incidents.

The commander of the Jayapura military command, Colonel Burhanuddin Siagian, who the UN has indicted on crimes against humanity in East Timor, responded in a rather more predictable fashion, saying that it is the duty of the TNI to crush any groups carrying out separatist activities.

[For regular reports from Indonesian language news sources on West Papua and Indonesia, email indoleft- subscribe@lists.riseup.net.]

Maluku Police chief removed over RMS flag incident

Jakarta Post - July 17, 2007

Desy Nurhayati, Jakarta Post – Observers welcomed the dismissal of Maluku's provincial police chief following the recent flag- waving incident by a separatist group in Ambon.

They said it was an appropriate measure but called also for the removal of security officials responsible for the incident.

The National Police confirmed Monday the dismissal of Insp. Gen. Guntur Gatot Setiawan as Maluku provincial police chief. He would be replaced by Insp. Gen. Guntur Ariyadi who currently serves as the National Police chief's deputy for operational affairs, the police said.

"The National Police did the right thing by discharging the Maluku police chief and we should appreciate that," legislator Yuddy Chrisnandi from the House of Representatives' Commission I overseeing information, defense and foreign affairs, told The Jakarta Post on Monday.

He said the dismissal was a form of disciplinary action the police chief had to take, even though the dismissed police chief was not personally at fault.

A group of separatists from the South Maluku Republic (RMS) attempted to wave their flag in front of President Susilo Bambang Yudhoyono's entourage during his visit to Maluku on June 29. During a ceremony to commemorate National Family Day, the protesters performed an unscheduled cakalele war dance for about 15 minutes before one of them unfolded a large RMS flag.

The group's actions were considered a serious threat to the country's unity. Authorities have detained a number of RMS activists, most of whom have been arrested and convicted for their involvement in similar cases in 2004 and 2005.

Yuddy said it was not only the Maluku Police chief who should be discharged, but also officers from the Presidential Guards (Paspampres) and the Pattimura military command (Kodam). "Commanders of Paspampres and Kodam should also be discharged (because) the incident took place in the second ring, which was guarded by Paspampres, Kodam and the police," he said.

Echoing Yuddy's comments, Neta S. Pane from the Indonesian Police Watch agreed with the dismissal, but said the decision was made too late. "Whoever was responsible for the incident – the police, Paspampres or Kodam – they should be expelled... brought to court and tried for (gross) negligence," Neta said.

"They need to be processed in court (so we can) find the weak points that have caused the incident. "This can also be a good lesson for security officials (to ensure) such an incident never happen again."

But Yuddy said there was no need for the officials to stand trial and that dismissal would be enough for failing to secure the event.

 Demos, actions, protests...

Activists rally to get out the vote for government poll

Jakarta Post - July 20, 2007

Adianto P. Simamora, Jakarta – A voter education group distributed educational brochures for the gubernatorial election Thursday to encourage people to use their right to vote.

Volunteers from the People's Voter Education Network stood at the Hotel Indonesia roundabout in Central Jakarta to give brochures to passing vehicles.

The brochure shows the profiles of the candidates along with what the candidate's responses to what the group identified as Jakarta's problem areas, including traffic congestion, floods, waste management and the economy.

The education network is comprised of Islamic mass organizations from Nahdatul Ulama and Muhammadiyah, interfaith communities, universities and radio news networks. The network was established in 1999 and is aimed at improving the public's participation in local issues and political processes.

Approximately 1,000,000 brochures on the Jakarta gubernatorial election would be distributed through supermarkets, churches, mosques and many other places, the network said.

National coordinator of the network, Jeirry Sumampow, said they asked people to be realistic "and just accept the two available candidates regardless their weaknesses".

"They are not supermen who will solve all problems perfectly," Jeirry said.

"That is why we have to know the candidates' profiles and responses to important issues to prepare ourselves to use our right at the election. To choose means we are responsible for the process of democracy of the city," he said.

It is estimated approximately 22 percent or 1.3 million from about 5.7 million eligible voters in the city are not registered.

Jakarta will host the first-ever gubernatorial election on August 8. The election campaign would take place for 14 days starting Sunday.

On-leave deputy governor Fauzi Bowo and running mate Prijanto are set to take on Adang Daradjatun, the former deputy chief of the National Police, and running mate Dani Anwar, a politician from the Prosperous Justice Party (PKS).

Further to the educational work of the network, the Jakarta Elections Supervisory Committee has invited the public to report alleged election-related violations.

But committee spokesperson Kamsul Hasan said, "we will not follow up reports or complaints from anyone, including gubernatorial candidates or their campaign team, if it is made more than a week after the date of the incident".

Kamsul said the committee would keep a record of all complaints made however regardless of whether or not they were able to act on them.

He made the statement after the committee signed Wednesday a memorandum of understanding with police and Jakarta's high court on integrated law enforcement around Jakarta gubernatorial election.

Kamsul said the committee would be the only vehicle for reports or complaints on election-related cases.

"The committee will sort through the reports or complaints first to determine whether the violation is administrative or criminal," he said.

"The administrative cases will be handled by the committee, while the criminal reports will be submitted to the police before being reported to the Jakarta High Court."

The poll watchdog has repeatedly called on the public to report violations ahead of the election.

Protesters want Japanese company nationalised

Tempo Interactive - July 18, 2007

Hambali Batubara, Medan – Student and social organisations in the North Sumatra provincial capital of Medan demonstrated at the Japanese Consulate and the representative offices of PT Indonesia Asahan Aluminium (PT Inalum) on Wednesday July 18. They were demanding that PT Inalum – which is majority owned by the Japanese government – be nationalised in order overcome the electricity crisis in North Sumatra.

In speeches the protesters said that the state-owned electricity company PLN has been unable to overcome the electricity crisis that North Sumatra has been suffering for some years now. PT Inalum meanwhile has been given full authority to manage the Sigura-gura Waterfall to supply the electricity needs of the company.

"Inalum, as a foreign company with massive capital appears to be neglecting the electricity crisis and leaving the people's homes in the dark", said action coordinator Harlen in a speech in front of the Japanese Consulate on Jl. Diponegoro in Medan.

The protesters also called on PLN and the North Sumatra provincial government to act firmly against PT Inalum who appears to be repeatedly extending the electricity supply barter agreement. PT Inalum's public relations officer Sijabat was not available for comment.

The electricity crisis in North Sumatra has been going on for some years and the situation has worsened over the last year. Rotating blackouts are frequent, with the latest round starting in July. The blackouts can occur three times a day for periods of up to four hours.

PT PLN North Sumatra says that North Sumatra has an electricity deficit of as much as 110 megawatts which the company has tried to overcome by renting a 65 megawatt capacity generator. They are attempting to overcome the remaining shortfall through an electricity supply barter agreement with PT Inalum that was facilitated by the North Sumatra government.

[Translated by James Balowski.]


Victims of conflict call on government resolve past rights abuses

Aceh Kita - July 23, 2007

Udin – At least 200 victims of the Aceh conflict from the Fraternal Solidarity for Victims of Human Rights Violations (SPKP HAM) demonstrated at the Aceh Regional House of Representatives (DPRD) on the afternoon of Monday July 23. They were calling on the government to immediately form a Truth and Reconciliation Commission (KKR) to resolve past humanitarian crimes.

Most of the participants in the demonstration were women, some of whom were in tears. Two of the protesters even fainted because they were so stricken with sadness. A light drizzle that had been falling on Banda Aceh since morning did not however lessen the protesters' determination to voice their demands. During the action they also brought banners and posters with messages demanding that the resolution of human rights violations in Aceh be accelerated.

In a speech Banda Aceh SPKP HAM chairperson Ali Zamzami demanded that the government be serious about resolving cases of human rights violations that occurred when the government declared the Military Operational Zone [1989-1998] and the state of martial law and civil emergency [May 2003 to April 2005]. "Aceh's dark history must be revealed now through a KKR", said Zamzami.

Nirwan voiced similar demands. In a speech he said he hoped that legislators would be able to cooperate with them to fight for the creation of a Truth and Justice Commission to solve past humanitarian crimes. He also asked the government not to keep making promised to victims of the conflict then failing to keep them.

"In Law No. 11/2006 on Aceh Governance it states that human rights violations are to be investigated. But where is the commitment? It has been almost a year and the KKR has yet to be formed", challenged Nirwan.

After giving speeches for almost an hour, the demonstrators met with members of the Aceh DPRD including Bachrum M. Rasyid, Samsul Bahri and Jamaluddin T. Muku. The respected members of the assembly however did not present a statement to the demonstrators, only making an offer for representatives from the protesters to hold a dialogue with leaders of the assembly. The protesters agreed to the proposal.

During the meeting that took place in the Aceh DPRD meeting room, the victims of the conflict explained about the formation of the Truth and Reconciliation Commission and the process of reintegration following the conflict. They also handed over a 16-page resolution arising out of SPKP HAM's second congress.

Commission A member Waisul Qarani promised to convey their demands to the Aceh governor and President Susilo Bambang Yudhoyono. Rasyid said that the delays in the formation of the Truth and Reconciliation Commission were because it was being obstructed by various regulations issued by the central government. In addition to this the Constitutional Court had also revoked Law No. 27/2004 on the formation of a national Truth and Reconciliation Commission which had therefore obstructed the formation of the Aceh commission. [dzie]

[Translated by James Balowski.]

Sharia still not well understood in Aceh

Jakarta Post - July 21, 2007

Nani Afrida, Berastagi – Five years after sharia was first implemented in Aceh, many residents, especially villagers, still do not fully understand it, an Islamic group says.

Many residents are unsure about its implementation, while some groups have politicized it, resulting in a focus on punishments like public caning and the requirement for women to wear a headscarf.

Gazali Mohammad Syam of the Aceh Ulema Conference Council said there was a need to further familiarize locals with sharia and its regulations, especially in villages. "Some people might still take sharia's implementation lightly, maybe because they have no knowledge on the matter," Gazali said.

He was speaking at recent meeting on five years of sharia in Aceh, organized by Mitra Sejati Perempuan Indonesia in Berastagi, North Sumatra. The one-day meeting involved 20 participants from various groups in Aceh, including the sharia office, as well as officials, the police, ulema, academics, activists, lawmakers, the Aceh and Nias Reconstruction and Rehabilitation Agency and several women's organizations.

Academic Arraniry Hamid Sarong said the poor understanding of sharia had become a serious problem and was beyond explanation given that sharia was introduced to Aceh in 2003.

Sharia was implemented in the province two years after the central government granted special autonomy to Aceh in order to curb the independence campaign conducted by the Free Aceh Movement.

"Back then, when sharia was about to officially introduced, everyone was in high spirits, so they forgot about how to implement the law," said an expert from the State Institute of Islamic Studies.

He said public caning for men who do not perform prayers three times of Fridays was an example of sharia that had not been enforced correctly.

When the law first came in, people were in high spirits, he said, but when it came to implementing the law, everyone was confused. "Everyone forgot how to find evidence that a man did not perform Friday prayers. It must involve the police, the prosecutor and the judge," Hamid said.

Since sharia's implementation, several qanuns or local ordinances have been passed. They include bans on khamar (drinking), maisir (gambling) and khalwat (premarital sex). Sharia also bans men and women from eating and selling food during the Ramadhan fasting month and forces Muslim women to wear the headscarf. Since its introduction in 2005, the sharia court has dealt with 157 cases.

Hamid said the government and the community had a tendency to make things official but got caught up in jargons and symbols instead of getting to the core of the problem. "Now there is a need to make people understand sharia which has been made official," he said.

Apart from a lack of understanding and familiarity, critics have pointed the finger at officials, saying they have failed to be good role models.

Several officials and even a sharia police officer have been apprehended for premarital sex but escaped prosecution. "It would be better if the sharia was implemented without making any exceptions," Gazali said.

Victims of Aceh conflict to hold second congress in July

Aceh Kita - July 19, 2007

Banda Aceh – Victims of the Aceh conflict being assisted by the group Fraternal Solidarity for Victims of Human Rights Violations (SPKP HAM) will hold their second congress in Saree in the Lembah Seulawah sub-district of Greater Aceh on July 20-23.

SPKP HAM Aceh coordinator Ali Zamzami said that the congress will be attended by some 300 participants consisting of victims of human rights violations from across Aceh, the founders of SPKP, observers and other invited guests. "The congress will push for and provide justice in contributing to the peace process as a channel to voice the wishes of the victims of human rights violations", Zamzami said in a press release sent to Aceh Kita on Thursday July 19.

In addition to choosing a management board and formulating a structure for the organisation, the congress will also be garnering support for and building an alliance that will be effecting in organising other victims.

Appearing at the second congress will be Ifdal Kasim (the commissioner of the National Human Rights Commission), Suciwati (wife of the late Munir), members of the National Commission on Violence Against Women, Faisal Hadi (the executive director of the Coalition of Non-Government Human Rights Organisations), Mugiyanto (Indonesian Association of the Families of Missing Persons), Asiah (Aceh Commission for Missing Persons and Victims of Violence) and representatives from groups supporting the victims of violence in West Papua, Tanjung Priok and East Timor. [dzie]

[Translated by James Balowski.]

GAM's party good for Aceh's peace, stability

Jakarta Post - July 17, 2007

Aguswandi, Banda Aceh – The Free Aceh Movement (GAM) establishing itself as a political party is the last thing Jakarta needs to worry about right now. In fact it should be celebrated as another step in Aceh's peace process. It is a success of the reintegration – political reintegration – of former combatants fully into the society. All reintegration programs established after the Helsinki pact have been trying to get individual ex-combatants back into normal life. Now is the time to help them, as a group, enter the normal democratic and political process in Aceh and Indonesia.

GAM's full transformation from an armed movement into a political movement is important for peace in Aceh. For now, like it or not, GAM's future political transition will affect the future of Aceh, and the celebrated peace process in the province. The decision to set up a political party shows they have the aspiration and intention to enter the normal democratic political struggle. It means things are improving and on track with the Helsinki pact.

Seen also in this way, it is the end of the old GAM and the beginning of a new, peaceful, political one. The weapons have been handed over, the armed wing has been disbanded and they as a group of former combatants have decided to set up a political party. Some of them are not interested in politics, many more are interested in setting up companies or continuing their studies, or getting married and having a normal life. So what?

GAM maintains its original flag and name as symbols of its political party for two reasons. First, to attract voters and a show off that they were the one who fought in Aceh before.

Second, it is important for some of the ex-rebels involved in an internal power struggle who are now claiming this is the real GAM political party. All the others are not, but either they are "political deserters" or not the genuine one. The complexity of the former rebel movement can only be understood by those who have followed the split within GAM after the governor election.

The initiative taken by some leaders within GAM to establish themselves as a political party, with its flag and its name, is more of a challenge to other groups within GAM than to the outside, including Jakarta.

So the flag might be the same, the symbols might not have changed, but life in Aceh is different since the peace agreement was signed. Life is moving forward in Aceh, not backward. GAM, like any other group in Aceh faces the challenge to talk about substantial issues, not about flags and symbols.

If GAM is to ever really be a political party, they also have to talk about the economy, education, governance and all the other things that matter to Acehnese life. They also have to compete with ideas from other political parties and civil society groups.

It is similar to the present governor, Irwandi, a former rebel, elected in the regional election. Instead of talking about symbolic stuff, he is busy talking about investment and development strategy. This scenario for Aceh is better than having a group or individuals who claim to be the representatives of the people, but have not actually been elected.

In fact, it is important to help GAM to move in the direction as a non-violent and democratic group. It will help them as a whole to become a more sophisticated political entity participating in the electorate process. In fact, their internal rift, their failure to transform themselves will be bad for the peace process. It might create a provisional type group like the case with the MNLF in the Philippines, or provisional IRA in North Ireland.

We are almost there now, at the closure of the ideal transformation of conflict in Aceh, from violent and bloody to an open and democratic process. Indonesia is in the process of creating a historical event, for ourselves and the world, solving a conflict and transforming peacefully.

Flags, symbols and names are the last things we should be discussing right now. Not Governor Irwandi, GAM or Jakarta can sustain themselves by highlighting this matter. More important things are the creation of jobs, the economy, building good governance, assisting victims of conflict and rebuilding after the tsunami. We can no longer build a future society based on a flag and symbols.

[The writer is a consultant on post-conflict in Aceh. The views expressed here are personal. He can be reached at agus_smur@hotmail.com.]

 West Papua

Report highlights human rights abuse in West Papua

Green Left Weekly - July 18, 2007

James Balowski, Jakarta – Indonesian police routinely torture, rape and kill with impunity in West Papua and risk fanning separatism there, Human Rights Watch (HRW) said in a report released on July 5.

The 93-page report, Out of Sight: Endemic Abuse and Impunity in Papua's Central Highlands, documents daily abuses by police officers and other security forces. A key finding of the report is that the police, particularly the paramilitary Mobile Brigade (Brimob), are responsible for the most serious violations although brutal treatment by the TNI (Indonesian military) also continue.

HRW documented 14 cases of abuse – in which only one security officer was prosecuted and jailed for eight months – and the report contains graphic first-hand accounts from the victims.

"I wanted to scream but he had his hand over my mouth and then he forced me. I resisted but he still forced me", a 16-year-old rape victim said. "Then he carried out the act on me. I couldn't walk. I was in so much pain. After that he ordered me that if I told anyone what had happened he would come and kill me", said the woman, whose village chief advised her not report the attack saying it would cause trouble with the military.

Another man described what happened when Brimob officers arrested him and some friends for a peaceful independence flag raising: "My teeth fell out. Blood flowed out. I was hit. I was kicked twice and then in the stomach twice again. I was kicked in the nose, the mouth and the teeth. More kicks were ordered and this was repeated. I could not count the number of times. I saw all my friends given the same treatment."

A similar story was related by a man who reported being beaten by the police while witnessing the arrest of another person: "I was beaten with the end of a gun on my back, and with fists to my face. My mouth and eyes were smashed and bleeding. I felt dizzy and fell. Straight away I was kicked by five members of the police and Brimob.

"They were all wearing complete official uniforms with guns... I was barely conscious when five members of the police took me into the car. As they were taking me, they punched me to the back three times with rifle butts and then in the car I was beaten with a truncheon."

HRW said that the head of the police and military in the region did not respond to requests for information on the cases the group documented. "No one is being prosecuted for the crimes we documented... The police are acting as a law unto themselves", Joseph Saunders, HRW's deputy program director, said in a statement.

Following the release of the report Indonesian police chief Sutanto said the claims will be investigated. "Please give us the information because we want the Indonesian police to protect the people", Sutanto told Agence France Presse on July 6.

In February, HRW released a report titled Protest and Punishment: Political Prisoners in Papua that documented severe restrictions on freedom of expression, assembly and association in Papua.

HRW called on the Indonesian government to open West Papua to independent observers in order to increase the amount and quality of information about conditions there and to allow independent and transparent investigations to take place. "The lack of reliable factual accounts means that unfounded rumours circulate with much the same potency as accurate accounts", the report said.

Indonesia won sovereignty over Papua, formerly a Dutch colony in the western half of the island of New Guinea, in 1969 after a referendum widely seen as a sham. A poorly armed separatist group, the Free Papua Movement, has conducted a low-profile armed resistance since the 1960s.

The report follows a visit to the province by UN Special Representative for Human Rights Affairs Hina Jilani on June 9, which was greeted by pro-independence demonstrations. Jilani concluded her visit by calling for better protection for activists in West Papua and saying she was concerned about military harassment.

On July 2 the Indonesian government refused to give permission to Eni Faleomavaega, a Democrat member of the US Congress, to attend a conference of the Papuan Traditional Council in the provincial capital of Jayapura, saying his presence could "spark riots and encourage violence".

[Out of Sight: Endemic Abuse and Impunity in Papua's Central Highlands can be viewed at http://hrw.org.]

 Human rights/law

House ends session with little to show

Jakarta Post - July 21, 2007

Ridwan Max Sijabat, Jakarta – As in previous sitting periods, the House of Representatives seemed to spend little time passing laws to benefit the people, and lots of time criticizing the administration.

Speaker Agung Laksono said the House has yet to give equal attention to its legislative, budgetary and oversight tasks.

Addressing the closing of the fourth sitting period at a plenary session here Friday, Agung said the House approved only 14 new bills during the three-month period, eight of which were on the formation of new regencies and municipalities.

He said the body had been too critical of the government in hearings and motions in reaction to the government's slow handling of numerous problems. "With the newly endorsed 14 bills, the House has approved 49 bills this fiscal year," he said.

The House, installed in October 2004, has endorsed a total of 76 out of 284 bills which have been given top priority for deliberation during the 2004-2009 period.

The 14 newly approved bills include one on excise taxes, limited corporations, Jakarta administration, minerals and energy, and the management of coastal areas and islets.

Agung, who chairs a team tasked to improve the House's legislative performance, said the legislature needed more help from experts and researchers.

He also said the House put more of an emphasis on quality than quantity, to prevent its products from being annulled by the Constitutional Court.

"We have formed two special committees to read the four political bills which are scheduled to be endorsed in December to give the public more participation... But, it seems impossible for us to prioritize the deliberation of two bills on land reform and forestry submitted by the Regional Representatives Council because of the rigid agenda," he said.

The use by legislators of the right to formally question, or interpellate, the government was found to be less than effective, having accomplished little more than to bring the House and the administration into conflict.

Agung, also deputy chairman of the Golkar Party, said the inquiry motion against the government's support of the UN resolution sanctioning Iran over its nuclear program was over following a recent meeting between the President and the House leadership.

"The interpellation over the slow handling of the Lapindo mudflow in Sidoarjo, East Java, is underway and its fate will be decided in a plenary session scheduled for Aug. 21," he said.

The House also criticized the defense cooperation agreement between Indonesia and Singapore. The government has been asked to renegotiate the treaty before submitting it to the House for ratification.

Besides foreign issues, the legislative body also expressed concern over separatism in Maluku, Papua and Aceh, saying the Indonesian unitary state was final and separatist conflicts had to be managed through a comprehensive approach, instead of a conventional security one.

Regarding the 2008 draft state budget, Agung said the House was pessimistic Indonesian economic growth would reach 6.5 to 6.9 percent next year, since the government has yet to give necessary attention to the development of the real sector and the slow spending of the 2007 state budget.

Agung also warned the government of the constitutional mandate to set aside 20 percent of the budget for the education sector, saying it had to seek alternative financial sources to enable it to meet the requirement in the 2008 state budget.

Executive director of the Indonesian Center for Law and Policy Studies, Bivitri Susanti, criticized the House's performance. She said the legislative paid too much attention to issues with no relevance to the actual problems faced by people.

"This is a classic story. They (the House) have never evaluated themselves, although they receive plenty of criticism and input... this indicates either they have no political will or they aren't competent to do their job," she said.

AGO asked to provide more evidence, speed up Munir probe

Jakarta Post - July 21, 2007

Jakarta – An activist and the widow of slain rights campaigner Munir Said Thalib have asked the Attorney General's Office to provide more evidence in seeking a review of a Supreme Court acquittal of the main suspect in the murder case.

In a December 2006 verdict, the court acquitted Pollycarpus Budihari Priyanto, a Garuda Indonesia pilot, of murdering Munir citing legal technicalities.

"I'm afraid if the Attorney General's Office (AGO) asks for a review of the case with the current evidence it will not uncover other parties involved in the murder case," Usman Hamid, a rights activist and former member of a government-sanctioned fact- finding team for the case, told reporters Friday.

He said the perpetrators of Munir's murder can be grouped into three categories: planners, helpers and executors. "With the current evidence, the AGO can only touch the third category, the executor, while the other two will remain untouchable," Usman said.

Munir died of arsenic poisoning Sept. 7, 2004, while on board Garuda flight 974 from Indonesia to the Netherlands after having departed Singapore, where the plane stopped in transit.

Usman said that with recently uncovered evidence, the AGO could still only prosecute the "helpers", which, in this case, are officials from Garuda Indonesia.

Investigators recently announced two new suspects in the case, former Garuda president Indra Setiawan and secretary to Garuda's chief pilot Rohainil Aini. "It will be better if the review attempt goes along with new evidence and new suspects," Usman said.

Suciwati, Munir's widow, said she is merely seeking justice. "It's almost three years since the death of Munir, but the main perpetrator remains a mystery," she said.

She expressed hope, however, that the identities of those guilty of instigating Munir's murder will eventually be revealed. "Actually, we can easily find who was behind it. But in this country, when a case allegedly involves government and military officials, the law becomes blind," she said.

Suciwati questioned President Susilo Bambang Yudhoyono's resolve to settle the case. "It is apparent that his is only a half- hearted commitment. "The investigation results of the fact- finding team established by the President have never been published or been followed up," she said.

Choirul Anam, Suciwati's lawyer, said investigators should have already been able to draw conclusions on the murder from the available evidence.

"Starting from fake documents which were used by Pollycarpus to get on the same plane with Munir, then phone call records between Pollycarpus and officials at the National Intelligence Agency, and many others," he said. "All of those should be enough to (identify) the main actor, but then it will depend on the will of the officials handling the case to uncover it."

Suciwati also criticized the police investigation team, the makeup of which she said has been repeatedly altered. "Each time the team is changed, they always start from the beginning instead of continuing from the previous investigation," she said.

Usman said the longer Munir's murder is left unresolved, the greater the chance is it will be politicized, especially considering the closeness of the 2009 election.

Revocation of defamation articles 'a victory for Indonesia'

Jakarta Post - July 19, 2007

Alvin Darlanika Soedarjo, Jakarta – Law and rights activists have labeled the Constitutional Court's revocation of Criminal Code articles concerning defamation against the government as a glorious achievement for human rights enforcement.

In the wake of the decision, the activists demanded that the government show its commitment to the court's verdict by facilitating the necessary changes.

"The revocation (of defamation articles) shows that the Constitutional Court is supporting democracy in Indonesia. We hope that this can create a domino effect in which various discriminating law articles would be deleted," director for legal assistance at the Foundation of the Indonesian Legal Aid Institute, Taufik Basari, said Wednesday.

The Constitutional Court ruled Tuesday that articles 154 and 155 of the Criminal Code, which criminalize all forms of defamation against the government, were unconstitutional and therefore annulled.

Taufik told The Jakarta Post that the revocation should inspire local judges to be more brave in tackling the "big fish" in politics who are deemed "invisible" because of their power and connections.

"The times have changed in Indonesia. Those deleted articles have been used to protect the colonial government and the previous Indonesian governments. It's a maturing process for the country."

Taufik said, however, that the Criminal Code final draft, which has been under revision for a decade, still includes articles 154 and 155 as well as article 134. Article 134, which criminalizes defamation against the president, has also been annulled by the Constitutional Court.

"The Criminal Code draft will be handed over to the House of Representatives soon. Now it is still in the hands of the Justice and Human Rights Ministry."

Commission for Disappearances and Victims of Violence (Kontras) impunity division head, Haris Ashar, said the revocation of the defamation articles is an achievement for human rights supporters, but suggested that it be made retroactive.

"Previous sentences in the past regarding defamation should be corrected. Progress regarding human rights was measured by changes in law, but a multitude of cases were overlooked," he told the Post.

"There should be punishment for people who have used those articles for their own benefit. Exoneration of people's names, people who have been receiving punishment because of the articles should also be followed up on." He added that those convicted under the annulled articles should receive compensation.

Roby Alampay, executive director of the Southeast Asian Press Alliance, called articles 154 and 155 backward and antiquated, saying they have no place in a modern society with aspirations for genuine democracy.

"Former president Soeharto used the crude laws to imprison his critics over three decades in power, and even after he had been deposed the laws continued to hang over the heads of Indonesians who had anything to say about government and country," Alampay said in a statement, a copy of which was made available to the Post on Wednesday.

He said the court's decision was a victory for all Indonesians and an inspiration to champions of free speech throughout Southeast Asia.

Government urged to ratify UN protocol against prison torture

Jakarta Post - July 19, 2007

Alvin Darlanika Soedarjo, Jakarta – Rampant torture in Indonesian prisons could be minimized if the government ratified the Optional Protocol of the United Nations Convention against Torture, several NGOs said.

Under the protocol, the country's prisons would be open to independent external monitoring.

"Transparency at prison centers is a matter of regulation. The ruling can enhance and press Indonesia to ratify the Optional Protocol of the UN Convention against Torture (OPCAT)," said Institute for Policy Research and Advocacy chairwoman Agung Putri on Wednesday.

Addressing the launch of a book on prison monitoring, Putri said the approach of prison center officials in observing inmates throughout the country is failing.

"There is a perception that people with prison sentences have minimal rights. Inside the prison centers, people who are weak tend to become victimized," Putri said, referring to discrimination against women and child inmates.

Child inmates, she said, are often threatened by sexual abuse while transsexuals often become the object of rape.

"With the ratified OPCAT, prison officials could be monitored and jail won't become a 'closed wall'. Any abuse will become an international concern" she said.

Association for the Prevention of Torture Asia-Pacific program officer, Philippe Tremblay, said eradicating prison oppression will not happen overnight as it is also a matter of changing the culture of incarceration.

"The Indonesian government and parliament should start paying serious attention to the OPCAT, which is the most effective way of minimizing torture," he said.

The optional protocol has been ratified by 34 countries and signed by 31 from Africa, Latin America, the Asia Pacific and Eastern and Western Europe. "Signing means that they agree to ratify the optional protocol."

Philippe said the signing of the protocol should be fast-tracked by the Indonesian government to ensure it is dealt with before the 2009 national election.

If OPCAT is signed by Indonesia, a system of regular monitoring would be set up in which an international body would visit prisons in the country once every four or five years.

"The international body should be independent. This could be led by a local commission, such as the National Commission on Human Rights of Indonesia," Philippe added.

Director for monitoring and evaluation at the Justice and Human Rights Ministry, R. Bambang Subagio, said there had been an effort to revise the Criminal Code to see to it that not all persons convicted of crimes were sent to prison.

"In order to further promote the idea of implementing human rights, we have formed national teams in 450 regencies to raise awareness on the subject to local governmental agencies," Bambang added.

"Especially in provinces of East Java, South Sulawesi and East Nusa Tenggara, where torture or abusive practices are prevalent," he said.

Men, women 'still unequal 23 years on'

Jakarta Post - July 18, 2007

Jakarta – The government has made no significant progress toward implementing the Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) 23 years after its ratification, women's rights advocates say.

"We haven't seen any concrete action from the government regarding the elimination of discrimination against women," Rena Herdiyani, executive director of the Kalyanamitra women's group, said in a conference on CEDAW on Tuesday.

She said that even though the government had taken some minor steps toward eliminating discrimination against women in Indonesia, "(Women) have yet to benefit from it."

"Most laws, such as the 1974 Marriage Law and the 1992 Health Law, still contain articles that discriminate against women," Rena said. The marriage and health laws contain articles that permit polygamy in the case of infertility and ban the distribution of information on reproductive health to unmarried people.

Rena said the two laws require urgent revision, but that the government had not shown any willingness to amend them. "The process is moving along slowly. Take for example the Marriage Law that was sent into the legislature in the early 1990s but has yet to be finished," she said.

On July 27, Indonesia will present a review of its implementation of the convention at a CEDAW committee session in New York which runs from July 23 to Aug. 10.

Eva Kusuma Sundari, a legislator from the Indonesian Democratic Party of Struggle, criticized the State Minister for Women's Empowerment, insisting she had failed to effectively campaign for gender equality in the legislature. "This minister cannot even influence other ministers, let alone the legislature," she said.

Eva said that the majority of women politicians in the House of Representatives had failed to assist in facilitating the implementation of the convention.

"There has been no systematic campaign to make legislators aware that they have a special assignment in monitoring the implementation of CEDAW," she said.

From among the 62 women legislators at the House, only 20 percent adhered to the feminist premise of gender equality, she said. "The others, they are women in appearance only, but their perspectives are not women-oriented," Eva said.

She added, however, that this was not completely their fault as their respective parties had not educated them on the fact that gender equality was an ideological mandate. "No wonder the House as an institution has yet to achieve a strong commitment for gender equality," she said.

Court move opens up free speech

Jakarta Post - July 18, 2007

Tony Hotland, Jakarta – The Constitutional Court struck down on Tuesday articles in the Criminal Code banning speeches and writing expressing hostility toward or inciting hatred of the government, calling the centuries-old rulings detrimental to democracy.

The verdict arrived after the court also scrapped in December three articles that ruled burning pictures of the president and vice president and mocking them in public were crimes.

The code was introduced during the Dutch colonial period and was often used by former president Soeharto to stifle critics. These articles were also used to silence and imprison activists by both the previous and current administrations.

"Articles 154 and 155 in the Criminal Code run against the 1945 Constitution's Article 28 (on freedom of speech), thus they no longer have legality," said court chairman Jimly Asshiddiqie. The articles carried jail terms of up to seven years.

The court said the two articles were irrational because a citizen of an independent and sovereign nation could not possibly be hostile to the government, except in the case of treason. "The code already has specified articles on treason," said Court judge H.A.S. Natabaya.

Furthermore, the court said the Dutch justice authorities were also against the inclusion of such articles in their criminal code.

It said the Dutch government considered the articles to be against the freedom of expression and thus were applicable only in a colonized area. "History has shown that these articles were intended to be used against independence fighters during the Dutch colonization," said Natabaya.

The judicial review of the two articles was filed by Panji Utomo, a rights activist from Nanggroe Aceh Darussalam. Panji was sentenced to three months in jail by the Aceh District Court for expressing hatred and insulting the government at a rally at the office of the Aceh and Nias Rehabilitation and Reconstruction Agency last year.

"This is a victory for friends who have been struggling to create freedom of speech. This (verdict) defines democracy," he said.

The court, however, did not issue any verdicts on articles 107, 160, 161, 207 and 208, for which reviews were also filed. It said these articles were irrelevant to the points of constitutional rights damages that Panji had cited in his suit.

But the latest amendment of the Criminal Code drafted by the Justice and Human Rights Ministry still contains articles criminalizing such actions.

The ministry's director general of human rights Harkristuti Harkrisnowo said in a previous hearing of the trial that such articles could indeed be interpreted in multiple ways and that the government was considering revamping them.

 Labour issues

President told to examine labor exports

Jakarta Post - July 23, 2007

Ridwan Max Sijabat, Jakarta – Labor exporters and activists have called on President Susilo Bambang Yudhoyono to evaluate the implementation of a 2006 presidential instruction on rapid, cheap and safe labor exports following a rift between Manpower and Transmigration Minister Erman Suparno and chairman of the government-sponsored National Labor Placement and Protection Agency Jumhur Hidayat.

Migrant Care, a nongovernmental organization that provides advocacy for migrant workers overseas, said the mounting friction between the two officials had left migrant workers unprotected.

"We consider the rift to be one of authority and mainly due to conflicting interests. As evidence, both sides have never been involved in any fight for workers' interests," Migrant Care's policy coordinator Wahyu Susilo told The Jakarta Post on Sunday.

The rift started when the labor agency froze licenses recently awarded by Erman to an insurance consortium led by state-owned PT Jasindo and set up a private committee to implement the G-to-G agreement on the export of workers to South Korea.

Husein Alaydrus, chairman of the Indonesian Association of Labor Supplying Companies, called on the government to replace the insurance consortium with a trust fund whose duties would then carried out by an independent agency to ensure migrant workers' safety and welfare both at home and abroad.

The rift has also caused wide confusion and disagreement among labor exporters, who have called on the President to liquidate either the labor agency or the ministry for allegedly being corrupt and imposing red tape on migrant workers.

Migrant Care executive director Anis Hidayah expressed deep concern over the rift, saying both institutions had paid little attention to the thousands of troubled migrant workers, many facing death row, in Malaysia and Saudi Arabia.

"Conflicting interests have a lot to do with their efforts to raise funds for the 2009 general elections," she said.

The director of the Binawan Healthcare Institute, which supplies nurses and health workers overseas, Saleh Alwaini, called on the President to mediate the rift and give special attention to labor exports, as it was the only subsector able to help cope with unemployment problems and eradicate poverty.

"The government has to set up more labor training centers to improve the quality of job seekers and reform the corrupt bureaucracy to accelerate labor exports," he said.

Court tells Sogo to hire back dismissed workers

Jakarta Post - July 21, 2007

Jakarta – Jakarta Industrial Relations Court decided Thursday that retail giant Sogo must reemploy 45 staff who were fired due to the closing of the chain's Plaza Indonesia branch in Central Jakarta early this year.

Presiding Judge Heru Pramono said the court could not accept the reason given by PT Panen Lestari Internusa (PLI), Sogo's owner, to dismiss the employees. "The court has decided that the forced majeure reason the company used to fire the employees was not right, so we rejected it," Heru said.

The judge said the rejection was also based on the fact that three of the dismissed employees were pregnant.

According to the 2003 Labor Law, a company can fire staff if it suffers losses for two years in a row, or under forced majeure, but not workers who are pregnant.

The Industrial Relations Court was established in 2006 to handle labor disputes.

The judge said Sogo should pay the employees' salaries dating back to March and also ordered the company to pay Rp 50,000 to each former employee per day until they receive the compensation owed them.

PT PLI's lawyer, Andi Abdurrahman Nawawi, said the company is considering an appeal. "We will discuss with the company whether we will appeal or not, because there are no vacancies in Sogo for them," Andi said.

He said the main reason Sogo fired the employees was because the leasing contract between Sogo and PT Plaza Indonesia Realty ended on Feb. 28.

Sogo, which was first established in Japan, has three branches in Jakarta and six branches in several other large cities in Indonesia. PT PLI also holds licenses for Debenhams department store, Kinokuniya book stores and Starbucks cafes.

Andi said Sogo in Plaza Indonesia formerly had 346 employees. The company transferred 214 to within PLI's other chains, while another 79 resigned. But the remaining 53 refused both resignation and transfer to any chain other than Sogo.

PT PLI then fired the 53 employees who last month filed a lawsuit regarding the dismissal. During the legal process, eight employees agreed to resign and receive a severance payment, while the remaining 45 insisted the company reemploy them at another Sogo branch in the city.

The Sogo Workers Union said the employees sought reemployment because they believed the company was healthy. They were also suspicious over five particular firings, insisting Sogo discriminated against the former employees because they wear head scarves.

"The company also fired many workers who almost reached early pension," said Melvin Z., a member of the union. Andi denied the accusations of discrimination.

Workers fight on despite mass dismissal

Jakarta Post - July 19, 2007

Multa Fidrus, Tangerang – It was business as usual Wednesday a PT Naga Parama Shoes Industry (NASA) and PT Hardaya Aneka Shoes Industry (HASI), manufacturers for American athletic apparel company Nike, despite fears of a massive staff dismissal.

Factory staff – 7,500 employed by PT HASI and 6,500 by PT NASA – kept working as usual. The factories are in the same compound in Pasar Kemi, Tangerang.

"We can do nothing more than do our best at work because our struggle for a certain future through a rally at the Jakarta Stock Exchange building in Jakarta on Monday bore no fruit at all," said Hari S.W., a worker and deputy union chairman at PT HASI.

On Monday, thousands of workers from the two companies staged a rally at the Jakarta Stock Exchange building in Jl. Sudirman, South Jakarta to protest Nike's decision to cease placing orders with the two companies as of the end of 2007.

The workers demanded that Nike keep placing orders at the present level, or provide severance pay for all the workers.

Hari said the statement made by Erin Dobson, Nike's director for corporate responsibility communications, that Nike's decision to end the contracts with both factories was final, had caused the workers to become restless.

"We will still continue working as usual at least until December to complete the rest of Nike's orders," he said, adding that Monday's rally meant production had come to a complete halt.

Hari said so far the company's management had yet to decide what to do with its workers should Nike insist on its decision to sever the contract with the company.

According to the workers, Nike will terminate contracts with PT HASI and PT NASA, both of which are controlled by PT Central Cipta Murdaya, a holding company owned by Siti Hartati Murdaya, because of the "poor quality" of their products and services.

However, Hari dismissed Nike's explanation, saying that the factory had fulfilled Nike's quality standards and used the production system the sports company had demanded. Hari said workers continued to look for other ways to make Nike cancel its decision to terminate the contracts.

Separately, Agus Darsono, a worker at PT NASA, said that the factories' employees had been upset by the end of the contract. "This is just like a dream. Nike suddenly announced that it would terminate the contracts with PT NASA by March 2008 after 18 years of working together through good cooperation," he said.

He claimed that since the cooperation with Nike began in 1988, the company had never had any problems with product quality and quantity. "If the factories are shut down, not only the 14,000 workers, but hundreds of ojek (motorcycle taxi) drivers who daily transport workers from home to work will also be affected," Agus said, adding that the thousands of food sellers around the factories would also be put out of business.

On Tuesday morning, PT NASA organized a massive prayer attended by all the Muslim workers at the factory compound. Thousands of workers were drawn in solemn prayer and chanting led by cleric Habibullah Al Faqir.

"We held the massive prayers because restlessness has started to engulf us after we hear about the termination order," Sunardi, another executive at the workers union at PT NASA said. He said the prayers and the cleric's sermon were expected to calm the tension in the factory.

Cleric Al Faqir said it was the first time he had ever been invited to preach to anxious factory workers. "We hope that after attending the Istiqosah (prayer for strength of heart), the workers can calm down and avoid anarchy," he said.

Workers say Nike a bad sport

Jakarta Post - July 17, 2007

Jakarta Post – Thousands of workers from two shoe manufacturers rallied Monday at the Jakarta Stock Exchange building to demand Nike, an American athletic apparel company, restore contracts with the companies.

The workers are from PT Naga Sakti Parama Shoes Industry (NASA) and PT Hardaya Aneka Shoes Industry (HASI), both in Tangerang, which manufacture shoes exclusively for Nike. They took to the streets around the building, causing heavy traffic congestion along Jl. Sudirman, the city's main thoroughfare.

The protesters carried banners saying "Nike is a blood-sucking vampire" and "Go to hell Nike". "We demand Nike consider that more than 14,000 workers have relied on the company's shoe orders for many years. Please, don't put our lives in jeopardy," union spokeswoman Elizabeth Sutarti said.

Nike has terminated contracts with the two factories because of the "poor quality" of their products and services.

Sutarti, however, dismissed Nike's explanation, denying the factories were producing low-quality shoes or having delivery problems. "We rarely received complaints from Nike, at least in the past two years," she said.

Workers will continue to hold rallies if Nike does not meet their demands, she said.

Nike Corporation sent a termination letter to Siti Hartati Murdaya, president director of PT Central Cipta Murdaya, the holding company for both PT NASA and HASI, on July 6. The letter said Nike intended to end the cooperation with both companies. It provided a nine-month notice, saying the cooperation would end in March 2008.

Murdaya told a press conference she had negotiated with Nike for additional time, but to no avail. "We proposed termination periods of 18 months and 30 months for HASI and NASA, respectively. We can't relocate 14,000 workers over a nine-month period."

She said the companies needed more time to relocate workers and to create a new company to employ laid-off workers.

Maretha Sambe, a Nike media consultant, quoted the company's director for corporate responsibility communications, Erin Dobson, saying the company's decision to end the contracts with both factories was final. She said Nike had already warned them of their below-standard output and other problems in March this year by decreasing shoe orders by more than 50 percent.

According to Murdaya, Nike used to order 80 percent of the companies' total capacity of 1,000,000 pairs of shoes per month. But Nike decreased its monthly order to less than 300,000 pairs of shoes since early this year.

The US athletic apparel company is not responsible for paying compensation to affected workers, Sambe said. "Nike is only a buyer and not the investor who owns the factories and employs the workers."

 Environment/natural disasters

House enacts new energy law, hopes to encourage sustainability

Jakarta Post - July 18, 2007

Jakarta – The House of Representatives has enacted a new Energy Law that is aimed at securing sustainable energy supplies, and promoting energy conservation and the use of renewable energy resources.

In a plenary session Tuesday, all 10 House factions agreed by acclamation to enact the new law. The legislation was initiated by the House, and had been under discussion by the House's energy commission with the government, the private sector and other stakeholders since 2006.

"A review and revitalization of our national energy policy must be the first priority, as energy is a vital public need whose provision is the responsibility of the state," commission chairman Agusman Effendi said of the law.

The new legislation sets out the broad policies for the development of the energy sector, and will be complementary to other energy-related laws, including the 2003 Geothermal Law, the 2001 Oil and Gas Law, the 1997 Nuclear Energy Law, and the bills currently being deliberated to replace the 1985 Electricity Law and the 1967 Mining Law.

The policies set out in the bill include the maintaining of a strategic energy reserve to ensure the nation's energy security, consisting of not only conventional fossil fuels (oil, gas and coal), but also renewable energy resources, such as biofuels, hydropower, and geothermal energy.

In addition, the law envisages the development of renewable energy resources through pricing mechanisms and incentives, with the latter also being employed to promote efficient energy use.

Under the law, both the central government and local administrations are required to actively participate in ensuring the success of the new policies by providing tax breaks and financial incentives to industries that avail of renewable energy and engage in energy conservation. Energy subsidies for the poor will also be maintained.

A National Energy Board must be set up within six months after the law's enactment to serve as the highest-level policy maker in all energy sector development programs. The board will be chaired by the President and have the energy and mineral resources minister as a member.

Energy and Mineral Resources Minister Purnomo Yusgiantoro, who attended the plenary session, said the government would first work on drafting the government regulations establishing the board, and then the other ancillary regulations required to give effect to the legislation.

"With this new law, and with the board directly chaired by the President, we expect sustainable energy policies in the future to be more effective and better enforced," he said.

The ministry is currently discussing possible fiscal incentives with the tax service in connection with the law.

Prior to the enactment of the new law, President Susilo Bambang Yudhoyono issued a presidential decree on national energy policy, which envisages renewable energy accounting for 17 percent of the nation's energy consumption by 2025, with oil's share being reduced to 20 percent.

Oil currently accounts for 54 percent of the energy mix for the country's 220 million people, with the growing demand for energy posing the threat of an energy crisis in the future in the absence of sustainable energy policies.

Green group blasts government over Riau deforestation

Jakarta Post - July 21, 2007

Alvin Darlanika Soedarjo, Jakarta – The Indonesian Forum for the Environment (Walhi) has accused the government of encouraging deforestation by allowing eight industrial timber plantation companies to cut down trees in Riau province beyond the legal limit.

"The Forestry Ministry has issued permits for these companies to continue exploiting forest and peatland in Riau for the pulp and crude palm oil industries," Walhi chairman Chalid Muhammad told a media conference Friday.

The eight timber plantations, which control more than 2 million hectares of land in Riau, are responsible for the disappearance of forests in the province, he said.

"The ministry has failed to conserve the forests there and it should be held responsible for deforestation, which contributes to global warming," Chalid said.

Walhi cited letter of dispensation No. 613/2006 issued by Forestry Minister Malam Sambat Ka'ban, which allows the industrial timber plantations to continue to exploit the forests.

Indonesia, especially in rural areas, emits more than 3 billion tons of carbon dioxide annually. A large part of this is caused by deforestation.

Indonesia is considered the third leading emitter of greenhouse gases after the US and China.

Ka'ban, who is reportedly locked in a dispute with the National Police over forest-related crimes in Riau, issued a letter of support for Adelin Lis, the financial director of logging company PT Keang Nam Development Indonesia who is on trial for illegal logging in Riau.

The letter said Adelin was guilty only of administrative errors, not criminal action in logging outside the company's concession area.

Walhi Forest Campaign division head Rully Syumanda said forestry officials and the police put more effort into arresting poor rural culprits rather than the directors or owners of big companies involved in illegal logging.

"By 2015, about 93 percent of Riau's forest will be gone," he said.

Walhi said industrial timber plantation companies usually operated by cutting down the forest, clearing the land with fire and then planting industrial timber. Haze from forest fires in Indonesia is an annual occurrence, affecting large parts of the country and neighboring countries such as Singapore and Malaysia.

Chalid said a scheme proposed by several international organizations to reward rural people for forest conservation would not be effective, considering much of the land was controlled by plantation companies.

Besides Riau, Walhi representatives from West Kalimantan, Central Kalimantan, North Sumatra and Southeast Sulawesi reported on deforestation in their provinces.

The environmental group says police, judges and prosecutors must find new ways to stop illegal loggers, because previous efforts have proven useless.

Forestry Ministry spokesman Masyhud told The Jakarta Post he had not seen the dispensation letter allegedly issued by the minister granting the eight timber estate companies permission to fell more trees.

House shelves mudflow query motion until after break

Jakarta Post - July 20, 2007

Ridwan Max Sijabat, Jakarta – The House of Representatives decided Thursday to suspend finalizing its proposed interpellation motion over the Sidoarjo mudflow after the House Consultative Body agreed not to include the issue in Friday's House closing plenary session.

The Indonesian Democratic Party of Struggle and National Awakening Party factions were the only groups that proposed the interpellation motion be included in Friday's plenary session, House Deputy Speaker Soetardjo Soerjogoeritno said after the consultative body meeting.

Thursday's postponement was the second such occurrence after legislators failed to reach an agreement on the motion during a plenary session Tuesday.

"The majority eight factions want the motion to be decided after the recess period because Friday's plenary session focuses on the endorsement of two new bills and on a closing address for the current sitting period," he said.

The House is scheduled to approve bills on excises and limited companies, and to hear House Speaker Agung Laksono's closing address to this year's third sitting period. The House will assemble again in mid August.

Signed by 225 legislators, the motion pushed for an official explanation from the government over its slow handling of the mudflow at the mining site of Lapindo Brantas Inc. in Sidoarjo, East Java, and of thousands of displaced residents and their damaged assets.

The mudflow, caused by gas and hot-mud leaks in May 2006, has been flowing for more than a year. The government has not managed to stop the leakage or fairly compensate affected residents.

Yuddhy Chrisnandi, an initiator of the interpellation motion from the Golkar Party, confirmed that his faction would prefer the fate of the motion to be decided after the House's recess period. He insisted that Vice President Jusuf Kalla, who chairs Golkar, had asked that his faction give its full support to the motion.

"It is only a matter of time; but our faction fully supports the interpellation motion," he said.

Abdillah Toha, a National Mandate Party legislator, said he expects the President will provide an explanation of the government's handling of the mudflow in light of a recent agreement between the House and the government to try settle the issue.

"After recently bringing the friction between both state institutions to the Constitutional Court, both the government and the House agreed to have the President give the government's reply to the House's interpellation motion," he said.

Representatives from a number of factions at the House appealed to the Constitutional Court after the President refused to personally explain the government's support for UN Resolution 1747 imposing sanctions on Iran for its nuclear enrichment project.

Protesters put illegal logging trial on hold

Jakarta Post - July 19, 2007

Apriadi Gunawan, Medan – The trial of an illegal logging suspect was delayed Wednesday after a group of people disrupted court proceedings at Medan District Court in North Sumatra.

Tensions over Adelin Lis' hearing led presiding judge Arwan Byrin to postpone the trial until July 23. The trial was scheduled to examine five witnesses Wednesday but heard from just one.

Representatives from a North Sumatran group against illegal logging rushed into the courtroom and demanded Adelin be sentenced to life in prison. Police and prosecutors failed to secure the courtroom despite the judge's demands.

"We don't want to prevent the group from staging their protest but they have to do (it with some) order," said Medan's district court head Arwan. "And because they didn't, we postponed the trial."

Arwam said the protesters would have to respect the proceedings and told them to have some trust in the court. "There is no need to terrorize the court – especially if we want to uphold justice in this country," he said.

As financial director and owner of PT Keang Nam Development Indonesia, Adelin has been accused of violating forestry laws in relation to the illegal logging and collection of timber products outside the company's concession area in Mandailing Natal regency, North Sumatra, between 2000 and 2005.

Several protest groups in support of both sides packed the court Wednesday to witness the trial.

A group of youths claiming to come from the North Sumatran chapter of the Crescent Star Party said they were ready to bring in Forestry Minister MS Kaban (of CSP) as a witness to explain a letter he wrote for Adelin's lawyer and local police.

Hundreds of workers recently dismissed from PT Tropical Wood timber company also attended the hearing. They said they want traced the origin of timber produced by the company.

PT Keang Nam Development Indonesia president Oscar Sipayung was one of the witnesses presented by the prosecution. He said based on the forestry minister's letter in 1999, the company had the right to manage 58,590 hectares of forest. The permit would expire in 2049.

Oscar was the only witness examined by the judge during the Wednesday trial. When asked whether it was possible to present Kaban as a witness, prosecutor Harli Siregar said it would be considered.

Adelin's lawyer, Hotman Paris Hutapea, said he did not plan to present Kaban as witness. In a previous trial, Hotman told journalists he might present Kaban as a witness to explain the letter.

"It's the prosecutor's authority. But if the prosecutor wants to present him, we agree," Hotman said.

Adelin Lis received a letter of support from Forestry Minister MS Kaban, who said the alleged activity conducted by Adelin was not a crime, but an administrative error.

Lawyer Adnan Buyung Nasution criticized Kaban's actions Monday. He said Kaban had behaved unethically and would be seen to have obstructed justice. Legal experts have also asked the government to use anti-corruption laws, not forestry laws, to try illegal logging suspects.

Buyung said forestry laws and regulations did not have the necessary teeth to catch illegal logging suspects, especially if the suspects were business people or officials regularly untouched by the law.

Japan's nuclear plant leak to be reference for Muria residents

Tempo Interactive - July 18, 2007

Sohirin/Jems de Fortuna, Semarang – A leak at the Tokyo Electric Power Co (Tepco) nuclear-powered electric generator plant has made the residents around Gunung Muria (Jepara, Pati and Kudus, Central Java) grow stronger as regards resisting the government's plan to build a nuclear plant in their area.

"The government and Batan (the National Atomic Energy Agency) must be unselfish and cancel the plan," said Hasan Aoni Azis US, Deputy Chairman of Rekso Bumi Society (Marem), when contacted by Tempo, yesterday (17/7).

Marem is a community group around Gunung Muria, which has often been campaigning to reject the nuclear plant in Jepara during the last two months.

It was reported that Tepco's nuclear reactor emitted 1.5 liters of water containing radioactive material after an earthquake measuring 6.8 on the Richter scale shook Kashiwazaki, Monday (16/7).

Due to the earthquake that killed nine people and wrecked 300 buildings, Japan has closed down three of its nuclear reactors.

Hasan referred to the result of a survey by the Indonesian Institute of Sciences (LIPI), the Bandung Institute of Technology (ITB) and the Agency for the Assessment and Application of Environmental Technology, which stated that Muria Peninsula and Gunung Muria were fault areas with high potential of volcanic earthquakes.

"History also records that the areas around Muria, including Jepara, Kudus, Pati and Semarang have been hit by large earthquakes," he said.

Earlier, Iwan Kurniawan, a doctor of nuclear physics and also former Batan expert, said that the permit for a nuclear plant in Muria has not yet been given by the International Atomic Energy Agency (IAEA).

The Indonesian Nuclear Power Monitoring Agency (BPTNI) is currently studying the uranium content potential in East Nusa Tenggara area. According to BPTNI Head, Sukarman Aminjoyo, the research is important because Indonesia will use nuclear as a replacement for electricity fuel.

"If there are (potentials), how much is the content because so far only West Kalimantan is confirmed to be rich in uranium," he said in Kupang.

Graft laws best suited for dealing with illegal logging

Jakarta Post - July 17, 2007

Jakarta Post – Legal experts are recommending the government use the anti-corruption law, not forestry laws, to try illegal logging suspects.

Lawyer Adnan Buyung Nasution said Monday matters pertaining to illegal logging were extremely complicated, and the use of the anti-corruption law would be the best way to fight the crime.

Speaking during a seminar in Jakarta, Buyung said forestry laws and regulations did not have the necessary teeth to catch illegal logging suspects. "Some charges for forestry crimes fail because the suspects, businesspeople and officials, are often untouchable by the law," he said.

He cited the case of Adelin Lis, who received a letter of support from Forestry Minister MS Kaban, who said the allegedly illegal logging activities conducted by Adelin were not a crime, but simply an administrative error.

Adelin, financial director of PT Keang Nam Development Indonesia, is accused of violating forestry laws in relation to illegal logging and illegally collecting timber products outside the company's concession area in Mandailing Natal regency, North Sumatra, between 2000 and 2005.

Buyung said Minister Kaban's actions in the case were unethical and could be seen as obstruction of justice. "Why did Kaban say the case was only an administrative violation?" Buyung asked.

He said illegal logging could not proceed without the involvement of officials in forestry offices, regional administrations and law enforcement bodies.

Gayus Lumbuun, a member of the House of Representatives' law commission, said illegal logging always involved official corruption, which was why the crime was so difficult to tackle.

"We need specific regulations for (dealing with) illegal logging activities," Gayus said. He said of the 150 illegal logging cases the National Police had investigated, only 10 were brought to court, and in nine of these cases the accused were not convicted.

"These crimes caused losses equal to about a third of the state budget. And this continues because the police, regional administrations and the Forestry Ministry have their own interests in dealing with these cases," he said.

Gayus said the Attorney General's Office had the authority to fight illegal logging but had to be more involved in dealing with the crime. "The Attorney General's Office should play a role in handling these corruption crimes," he said.

Attorney General Hendarman Supandji, in an address read by Deputy Attorney General Mukhtar Arifin during the seminar, said many illegal logging suspects went uncaught because of the size of Indonesia's forests and the limited number of law enforcers.

Hendarman said illegal logging needed to be eradicated as quickly as possible because of the losses it caused the state, as well as the environmental damage. Separately, National Police chief Gen. Sutanto said the police, in cooperation with the Forestry Ministry, would set up a team to investigate illegal logging.

"We will send the team to Riau. The team will consist of police officers, Forestry Ministry officials and officials from the State Ministry for the Environment," he said.

Forestry Minister Kaban said earlier this month that Sutanto should focus on evaluating the performance of all provincial police chiefs, especially in Riau, North Sumatra and Papua, were numerous illegal logging suspects had walked free.

Tents still shelter displaced tsunami survivors

Jakarta Post - July 17, 2007

Ciamis – As a fisherman wife, Saring lives a simple life. But the 53-year-old never imagined she would have to camp in a make- shift tent for more than a year.

Along with 32 other displaced families, Saring has lived with her husband and four children in a temporary home since a July 17, 2006 tsunami struck and destroyed their house located some 15 meters away from the coastline at Parapat village in Pangandaran beach, Ciamis regency, West Java.

The disaster-relief tents are scattered in a plantation area about 10 meters from the main entrance to the popular Pangandaran beach.

The temporary 8-square-meter tent is the center of Saring's family's activities. It's where they sleep, play and study.

The tsunami wave damaged many fishing boats, including the one owned by Purwono, Saring's 55-year-old husband. Purwono's boat was how he earned a living and supported his family. "We have moved three times," Saring said. "In this place, we've been living for eight months."

In the nine months since cash aid was stopped, the couple have had to struggle to provide food for the family, or to send their children to school.

"I'll do anything," Saring said. "I will do other people's laundry or their cooking to make enough to buy vegetables. My husband has just started going to sea again but now has to stop due to high waves."

But Purwono said he would not easily give up. With simple equipment he still owned, he opened a repair shop to help fix damaged fishing boats and machines. He turned a nearby post some 20 meters from the tent to house his repair shop.

Saring and Purwono said they would survive but that living in their tent was torture.

"It's very hot during the daytime and very cold at night," Saring said. "Not to mention we have to squeeze in for space when sleeping. When my child got sick, it was terrible. I wish that I could sweep my floor again and sleep tight."

Another displaced resident, 35-year-old mother-of-three Wasiah said her 20-month-old boy was suffering from bronchitis.

"His coughing is not getting better and he is not gaining weight," Wasiah said. "It's sad to see him take medicine all the time."

The three public bathrooms used by the families living in makeshift tents are stronger buildings and serve as a shelter during heavy rains, despite the foul stench.

And although these families have received some financial aid to help build new homes, one year after the disaster the regency administration has yet to come up with relocation place where they should build their houses.

Most families used to live near the coastline, but they are no longer allowed to build houses there. "We're told that we might get land in April, then June and then July," Saring said.

Coordinator of Pangandaran displaced residents, Mardiyono, said of the tsunami-hit districts, only Pangandaran district residents did not yet have relocation sites.

Apart from the 33 families in Pangandaran beach, 13 other families in Wonoharjo village, one in Pananjung village and 22 in Babakan village were still in shelters, he said.

"We ask please don't act differently (because) we are residents here too and we can't go back to our former houses (because they also have been) declared prohibited," said Mardiyono.

But Ciamis Regent Engkon Koswara blamed the displaced residents for continuing to live in tents. "I was told everyone has received Rp 15 million assistance to move out (to new houses)," Engkon said.

But a new home seems like a distant dream for most of these displaced residents.

Ciamis Regency Legislative Council said it was working toward asking the regency administration to treat the displaced residents equally by providing them with a relocation site.

The council's secretary Subur said the administration was preparing a plot of land in Cimerak, Pangandaran, as a relocation site.

However, Sabur said most of the displaced residents still living in tents originally had their homes in areas where construction was prohibited.

He said this made the administration reluctant to prepare the relocation site since they had violated regulations in the first instance by building near the coastline. "They lived in areas where buildings were prohibited and they cannot rebuild there."

 Health & education

Politicians talk, teachers walk over education

Jakarta Post - July 20, 2007

Ridwan Max Sijabat, Jakarta – Legislators said Thursday the government should be able to allocate more money for the education sector, while thousands of teachers from Banten and West Java provinces marched through Jakarta to demand action on education.

Legislator Didik Rachbini, speaking at a seminar organized by the House of Representatives' education commission, said the government would be able to allocate the 20 percent of the state budget for education, as required by the Constitution, if it better managed its finances.

He said the government should manage its payment of foreign loans and bonds at some Rp 100 trillion annually, reduce the Rp 120 trillion in annual power and oil subsidies and increase efficiency efforts in other sectors.

Didik said Malaysia and Singapore allocated some 24 percent of their state budgets for education.

Commission chairman Masduki Baidlowi urged the government to prepare a fixed strategy and concrete education programs to be financed by the increased education budget.

"Increasing the education budget is not for raising teachers' salaries but for rehabilitating damaged education infrastructure and conducting a total reform of national education management in an effort to provide access for all to education and improve the quality of human resources," he said.

He also said the government should ensure schools to meet national standards for the nine-year compulsory education program.

"This is important as almost 70 percent of our workforce never went past elementary school. The majority of our migrant workers employed overseas are uneducated and unskilled," he said.

People's Consultative Assembly Speaker Hidayat Nurwahid said the government would be able to allocate 20 percent of the state budget for education if it had the political will.

"If the government intensifies tax collection efforts, it will be able to do it," he said. "I have information that leakage in tax revenue reaches 300 percent annually."

Hidayat also said he supported the Banten and West Java teachers' demands for more money.

The teachers rallied on Jakarta's main streets Thursday to force the government to allocate 20 percent of the budget for education and provide raises for the some 1.7 million teachers nationwide.

The teachers also demanded the government issue regulations on social security protection for teaching staff and on skills certifications. They also want the national exams axed as the lone determining factor for students' graduation.

The demonstration caused heavy traffic on the city's toll roads and main streets, as the teachers marched from the House building to the nearby Education Ministry and then to the State Palace.

"We will come again and stage bigger demonstrations until the government opens its eyes to the poor condition of education, including infrastructure and teaching staff. We are here to represent 1.7 million teachers nationwide and fight for our common interests," the chairman of West Java chapter of the Indonesian Teachers Association said during a meeting with leaders of the House and Regional Representatives Council.

Illegal school fees still the norm

Jakarta Post - July 20, 2007

Jakarta – A recent survey by a coalition of non-governmental organizations active in the education sector found schools are still illegally making parents pay to register their children as new students.

The survey, which covered 131 schools in 13 regencies and municipalities, found that besides charging parents fees for uniforms and textbooks, schools often impose fees for such non- educational projects such as the construction of fishponds, fences and prayer rooms.

"We compiled these results from the survey performed from June 19 to July 18. There are more reports coming. This is just the beginning. We will soon have a meeting with the respondents, the House of Representatives and the Education Ministry. We are also considering pressing charges against the government for allowing these practices," Ade Irawan of Indonesian Corruption Watch told The Jakarta Post on Thursday.

Ade said parents paid between Rp 250,000 (US$27.60) and Rp 7,500,000 ($828) to register their children at schools. He added most parents had no bargaining power because they were unfamiliar with admissions regulations, and they wanted to guarantee their children were registered.

"School officials never familiarize parents with the new student admissions procedures. They also never tell the public how many students they can accommodate. They exploit the system by selling admissions to students who do not qualify," he said.

Jumono from the Alliance of Parents Concerned With Education Funds said his organization tried to empower parents by giving them copies of the 2003 law on the national education system. The law stipulates the government must eliminate all obstructions to access to education.

"I want to empower parents by telling them their rights, so I distribute copies of the law. That strategy has worked. Parents who have copies have been able to avoid paying the illegal fees," he said.

Ade said schools often threw up administrative obstructions by requiring playgroup certificates as a qualification for registering at elementary schools, or demanding copies of birth certificates and refusing to accept birth notices issued by hospitals.

Jumono said schools must publicly post their budgets and admissions policies to ensure transparency. "I saw one school in eastern Indonesia that posted their school budget on the office wall. I haven't seen any school in Jakarta do that," he said.

Jumono said his organization had reported some of these cases to government officials, but this had only resulted in the schools' principals being replaced, without changing how the schools operated.

He said filing lawsuits against school officials was the best way to stop the practice of imposing illegal fees on parents. "But the police require us to submit evidence that the fees go into personal accounts. Unfortunately, we have not yet been able to provide such information," he said.

 Elections/political parties

Analysts warn of CSR abuse by political parties

Jakarta Post - July 23, 2007

Andi Haswidi, Jakarta – As corporate social responsibility (CSR) becomes mandatory in the new law on corporations, analysts warn the implementation of the legislation could be abused by politicians.

"I suspect this has something to do with the upcoming election. I fear the politicians will try to take a free ride for their campaigns at the cost of business players," economic analyst Faisal Basri told The Jakarta Post on Sunday.

Political parties might take advantage of a company's CSR programs to win over voters, or ask for part of a company's CSR budget to finance their social activities and political campaigns, he said.

Faisal criticized the factions in the House of Representatives for their approval Friday of the clause in the new law requiring all companies operating in and or connected with natural resources to institute social and environmental responsibility programs.

A political analyst at the Center for Electoral Reform, Smita Notosusanto, said abuse of the new requirement was likely. She said in the past the private sector has been a pivotal source of financing for political campaigns.

"There should be a clear definition in law and regulation that differentiates CSR and political campaigns, to avoid abuses," she said.

According to the commentary accompanying the legislation, Article 74 on CSR not only affects natural resource-based companies, such as mining, oil and gas and plantation firms, but also companies that do not exploit natural resources but "affect the functions of natural resources", which basically means all businesses outside the financial, information technology and consulting sectors.

Prior to the passage of the law, the Indonesian Chamber of Commerce and Industry (Kadin), together with Indonesian Business Links and dozens of other business associations, released a joint statement saying making CSR obligatory violates the principles of good governance and best practices, and that it is counterproductive to the concept of CSR.

"Corporate social responsibility is totally different from environmental responsibility. You can't just mix them up like that. Moreover, if CSR becomes obligatory, than it is not CSR anymore, which is supposed to be voluntary in nature," economic analyst Faisal said.

The implementation of the law, he said, would cause confusion or even overlap, as there were already laws governing environmental responsibilities, such as the Environment Law and the State-Owned Enterprises Law, plus different regulations imposed by local governments.

Faisal said CSR programs would be abused and used as part of the campaign machines of political parties.

"The implementation of this legislation will seriously hurt the already poor investment climate here. For foreign investment, this legislation literally says 'go away,'" Faisal said. A spokesman for the Federation of Industrial Associations, Franky M. Sibarani, said business associations had to lobby the government over the new law.

"The government is expected to finish the ancillary regulations in three months. What we want to do now is talk to the government so that they will listen to our perspective on what CSR is," Franky said.

He also said seeking a judicial review by the Constitutional Court was one option the federation was currently studying.

Law excluding ex-convicts is discriminatory: Expert

Jakarta Post - July 20, 2007

An expert in criminal law told the Constitutional Court on Thursday that a regulation stipulating that ex-convicts cannot run for office is unjust and discriminative.

"A person must not be labeled as a bad person forever even though they were once convicted of a criminal act, especially when they have already served time in prison for their crime," said Chairul Huda, a lecturer at Muhammadiyah University, during a Constitutional Court plenary session.

The court is currently reviewing Article 58 (f) of the 2004 Regional Administration Law in response to a request by Muhlis Matu, a member of the Takalar legislature in South Sulawesi, that the law be readdressed. The article states that a person who has been imprisoned for five years or more cannot become a candidate in a local election.

Muhlis claimed that the article infringed on his right to run for deputy regent in the local election because he was imprisoned for nine years from 1982 for attempted murder stemming from his adherence to the Makassarese tradition of Siri (pride). He was released on good behavior in 1987 after serving only five years.

"Article 58 (f) of the 2004 law does not cover all kinds of criminal acts because it only states that one can be a regional leader if he or she has never been sentenced for five years or more," Chairul said.

He charged that the article is clearly discriminative. "How about people who get sentenced to less than five years, but they commit the same crime and are convicted several times?" he asked.

"The article should be changed to read that all people who have faced criminal penalties or been imprisoned are forbidden to run in a regional election," he said.

Akil Mochtar, a lawmaker from the House of Representatives Commission for legal affairs, said the article was included to guarantee that regional administrations are led by people able to create good and clean governance.

"We want a person that can be a role model for other people," he said. Chairul disagreed, insisting that many of the country's leaders had been imprisoned several times but still made good leaders.

"Take former president Soekarno or House of Representatives deputy head A.M. Fatwa for example, both were imprisoned several times but nobody doubts their credibility," he said.

Muhlis's lawyer, Januardi Haribowo, said his client's election to the local legislature had never been questioned. It was not until he decided to run for the post of deputy regent that his status as an ex-convict became an issue.

The court session will remain adjourned until the House and the government decide on whether to summon more law experts to testify.

Lawmaker, minister call for political system restructuring

Jakarta Post - July 23, 2007

Jakarta – A lawmaker, a government minister and a political expert called for a restructuring of the political system during a weekend seminar, saying the present system has numerous loopholes and flaws.

Deputy chairman of the House of Representatives' political commission, Effendi Choirie, suggested the country adopt a bicameral system, with two legislative chambers, to empower the parliament.

He said under the current parliamentary system, the Regional Representatives Council (DPD) had no real power, even though it was under the House.

"I think the DPD should be able (to play its political role) and represent different elements of society," said Effendi, a member of the National Awakening Party, adding that under a bicameral system, the DPD would have more power to represent the people.

Effendi said the country's political system should be designed and empowered to fight for the rights and interests, both economic and social, of all citizens.

"The country's general election system should first and foremost consider the best interests of citizens," he said. "This will mean having the number of people's representatives from each region be based on the population of the different areas of the country."

As an example Effendi cited East Java, which has just four representatives in the DPD, although it is home to some 40 million people, "while Gorontalo, which is inhabited by 700,000 people, also has four representatives".

Another speaker at the seminar, State Minister for Youth and Sports Affairs Adhyaksa Dault, said the political elite had to lead the way in moving the country forward. "If the political elite stay like this, this country will remain in this (current) state, no matter who leads (the country)," Adhyaksa said.

Critics of the administration of President Susilo Bambang Yudhoyono say it has failed to address basic problems facing Indonesians, particularly unemployment and poverty.

Adhyaksa said the country needed a blueprint for its political development, taking an example of the United States which had its blueprint since its independence in 1776.

Indra J. Piliang of the Centre for Strategic and International Studies said the challenge for Indonesia was whether the current multiparty system was compatible with the current presidential system.

"What needs to be done is to create a simpler multiparty system by increasing the electoral threshold and also the parliamentary threshold," said Indra.

Besides challenging the current multiparty system, Indra also questioned whether a truly democratic system was in the best interests of Indonesia. He said many democratic countries had failed in terms of economic growth, while undemocratic countries succeeded.

Youth unexcited by election, candidates excited about youth

Jakarta Post - July 23, 2007

Jakarta – The official campaign period for Jakarta's first-ever direct gubernatorial election kicked off on Sunday. We'll be following Fauzi Bowo and Prijanto's fight against Adang Daradjatun and Dani Anwar for the top spot with our special election coverage from today to Aug. 8.

The election for Jakarta's new governor is just around the corner. It's getting increasingly hard to go anywhere in the city and not see bright orange banners testifying to the greatness of the two candidates.

It will be the first time Jakartans directly elect a governor and is thus an important poll, but there are concerns about the large number of first-time voters who will be participating and the possibility of a low voter turn out.

The Jakarta Elections Commission has said that 15 percent of the 5.7 million registered voters will taking part in an election for the first time.

The Indonesian Survey Institute recently found that 65 percent of eligible voters would not vote in the election – either because they were registered or had decided not to exercise their right to vote.

Other regional head elections have seen high participation rates of between 65 and 85 percent in the past three years.

Political analyst Andrinof Chaniago urged both candidates to focus on issues affecting young people to make sure they turned out on polling day.

"If they want to win the hearts of young people, both candidates should focus on things related to their lives, such as the improvement of youth centers and extracurricular activities at their schools," he said in a recent interview.

They should pay more attention to youth centers in the city's five municipalities, which were in a poor state and were often occupied by squatters, he said.

Moreover, public services, especially the transportation system, should be improved because young adults were highly mobile.

"What is important about this election is that the candidates can make form a relationship with the youths by promising to improve public services and realizing those promises," Chaniago said.

He said young people would actively participate in the election although the would focus more on the popularity of the candidates than their political messages.

Many young people, however, do not seem to be enthusiastic about the election and are unconvinced that the new governor will be able to bring many changes to the city.

A vocational student in Central Jakarta, Abdul Syukur, 17, said he probably would not vote because he thought neither candidate had paid much attention to the youth.

"I'm already registered for the election, but I don't think I will vote, because I think both candidates only care about politics and haven't focused on educational issues or youth matters yet," Abdul said.

He said he hoped that whoever won the election would be able to bring a true change to Jakarta and would focus on problems among teenagers, like drugs.

Anissha Tinanti, 19, said the election did not mean a lot to her as she thought the candidates offered only empty promises.

"But if I have to vote, I will vote for Fauzi Bowo because I think he's more experienced and more popular in Jakarta," said Anissha, a first year architecture student at the University of Indonesia.

Current deputy governor Fauzi Bowo and retired Army general Prijanto will face former deputy chief of the National Police, Adang Daradjatun, and his partner Dani Anwar in the official campaign period that started on Sunday.

Ipang Wahid, Adang's media consultant, said young people were strong supporters of Adang because they agreed with the changes the candidate would bring to city.

"We have many supporting elements, especially from the young, such as from the Orange Volunteers (Relawan Oranye) – a group affiliated with Adang and his running mate – and the Jakmania soccer fans club," Ipang said.

He said they planned to air a TV commercial about education and run several events that involved youth participation.

Fauzi campaign staffer Budi Siswanto said that even though the overall campaign would not focus on young people, they would hold some events involving celebrities or sport stars to educate young voters about the importance of casting their ballots.

"Many young people have known Fauzi even before he ran for the election, since he was the head of National Narcotics Agency and the former head of the National Sports Council," Budi said.

Candidates have fourteen days to get vote out

Jakarta Post - July 21, 2007

Endy M. Bayuni, Jakarta – The campaign for Jakarta's gubernatorial election officially kicks off Monday amid gloomy predictions from pundits and naysayers of a very low voter turnout, either because of the low registration rate or threats of a boycott by voters discontented with the system and the limited number of candidates.

Time will tell how accurate the pundits and the surveys are about low voter turnout (one survey this week even put expected turnout at a mere 35 percent), but unless the candidates themselves make an effort to get people to vote on Aug. 8, those predictions could easily become a self-fulfilling prophecy.

Should that happen, it will be a disaster for democracy, and the elected governor will rule for the next five years with little legitimacy. Governing then would be that much more difficult.

It is therefore in the interest of both teams contesting the election – the pairs of Fauzi Bowo and Prijanto, and Adang Daradjatun and Dani Anwar – to ensure that as many people as possible exercise their right to vote on election day.

Other local elections held in Indonesia over the past year or so, and there has been more than 100 in all, have seen reasonable levels of participation of between 65 and 85 percent of registered voters.

The trouble with the predictions for voter turnout in Jakarta is that it is unclear whether they are truly based on credible surveys of potential voters. Let's not forget that not everyone who lives and works in Jakarta automatically has the right to vote. Being the capital of Indonesia, there are many temporary residents and also temporary migrant workers. Many who live and work in Jakarta are actually residents of adjacent districts like Depok, Bogor, Tangerang and Bekasi.

This explains why the population of Jakarta is officially put at around 9 million, based on the number of Jakarta ID holders. In reality, however, Jakarta's population can reach 12 million, and even 14 to 15 million, during the day when people from adjacent areas come to the city to work and play.

With that in mind, the 5.7 million people who are registered to vote seems a reasonable figure, out of a population of between 8 and 9 million, if we remove those people too young to vote. The figure is also about the same as the number of registered voters for the 2004 national election.

Claims that millions of eligible Jakarta residents are not registered to vote are gross exaggerations. We can therefore eliminate this factor as a reason for a poor voter turnout next month.

It's a different story with voter discontent, which could lead to some sort of mass boycott of the election, or worse, a voter revolt. There was certainly a lot of discontent when it became clear only two candidates would be contesting the election.

Other, more popular, figures like politician Sarwono Kusumaatmadja or former minister and Army general Agum Gumelar, or actor Rano Karno, had been mentioned earlier as possible candidates for the top post in Jakarta, raising the prospect of a festive election.

So it was only natural that many people were disappointed when they learned there were only two candidates, neither a popular public figure.

Fauzi Bowo, the incumbent deputy governor who is taking time off to campaign for the governor position, has long been in the shadow of his boss Sutiyoso. Although he is an able and trained bureaucrat, most people know little of his role in Sutiyoso's administration.

Adang Daradjatun is not exactly a figure who would inspire people to vote. His career as a police officer, reaching as high as deputy chief of the National Police, is not that well known, certainly not to make people rush to the polls to vote for him.

Both candidates face the same challenge, so at least we can say we have a level playing field.

It's pointless at this stage to bemoan the limited number of candidates or the absence of independent and popular candidates. The decision has been made, and voters have to settle for these two.

The main challenge for both candidates during the official campaign period these next two weeks is to help voters get to know them enough to feel comfortable voting for them. In a system where voting is not compulsory, not voting is a legitimate option. Undoubtedly, many skeptics will exercise their right not to vote on Aug. 8.

Two weeks is not long enough for anyone to properly acquaint himself with the public, let alone talk about his track record and achievements. If there is one valuable lesson learned from these local elections, it is that the campaign period should be extended to allow voters to become familiar with the candidates.

Tight restrictions were imposed in the past for security reasons, with election rallies tending to be disorderly and even violent. But those days are no more. Most elections we have had since 1999, national and local, have been free of violent incidents. Surely, we can open up the space by now.

Both Fauzi and Adang, however, will have to settle with the two weeks allocated them to make themselves known to voters. It's a tall order, but both have an equal chance. May the best man win.

Voters to give government poll a pass: Survey

Jakarta Post - July 20, 2007

Mustaqim Adamrah, Jakarta – The Indonesian Survey Institute (LSI) says more than 65 percent of eligible voters in Jakarta will not cast ballots in the Aug. 8 gubernatorial election.

The research center defines this non-voting group as eligible voters who were left off voter lists and those who have been registered but will not exercise their right to vote.

After a three-day field survey and interviews with 600 randomly selected respondents, with an error margin of 4.1 percent, the LSI found 52 percent of eligible voters were not registered or did not know if they were on the voter lists.

"That number includes eligible voters who believe in the benefits of the forthcoming Jakarta election," said LSI executive director Saiful Mujani at a media conference. "But they still won't be able to vote. Therefore, we consider them part of the potential non-voting group."

The LSI, one of the leading research centers in the country, found at least 13 percent of eligible voters in the city were registered but were choosing not to vote because they did not like either of the two candidates in the election.

Saiful said the majority of those in the potential non-voting group were well educated, financially secure, aware of democracy and critical of the administration. "It (not voting) is their way of protesting the corrupt democracy," he said.

The candidates in the election are incumbent Deputy Governor Fauzi Bowo and his running mate Prijanto, a retired Army general; and former National Police deputy chief Adang Daradjatun and running mate Dani Anwar.

The Jakarta Elections Commission closed voter registration on June 28, with 5.7 million voters registered, or about 75 percent of Jakarta's total population. Previously, several research centers discovered around 1.2 million of Jakarta's eligible voters were not registered.

According to the LSI, non-voters in earlier regency, city and provincial elections around the country accounted for, on average, 25.03 percent, 34.13 percent and 34.84 percent of eligible voters, respectively.

"Jakarta is both a city and a province. The 65 percent figure is an alert that the Jakarta election results could be unreliable," said Saiful.

He warned of potential conflicts if the election proved close, with just a few percentage points separating the two candidates. "The losing candidate will claim some of the votes from the non- voting group as his," he said.

The Jakarta Legal Aid Institution and the Centre for Strategic and International Studies (CSIS) have encouraged voters to cast ballots.

Legal Aid Institution director Asfinawati said during a discussion Thursday that Jakartans should forge political contracts with the governor candidates, to hold the eventual winner to his campaign promises.

"We should support a new governor who develops a system that benefits all society, instead of benefiting just a few businessmen who have access to city officials because they have money," she said.

Any governor who is concerned with city development issues, she said, should encourage the people to be critical of the administration by forming watchdogs.

Another speaker at the discussion, CSIS political expert Indra J. Pilliang, said the public should increase their monitoring of the administration.

However, he warned some groups might try to misuse these watchdogs to foil attempts to improve the city, "as money is all that matters to them". (10)

Jakarta's voting population

  • Registered voters: 5.7 million
  • Eligible voters: 7.8 million
  • Jakarta population: 9.04 million

From various sources

Government told to concentrate on improving parties' quality

Jakarta Post - July 18, 2007

Alvin Darlanika Soedarjo, Jakarta – The government must improve the qualitative aspects, not quantitative aspects, of political parties through the package of political bills currently under deliberation at the House of Representatives, political observers said Tuesday.

"The government is obsessed with having only a few political parties reaching stability. Limiting the electoral threshold percentage for parties is not the answer for a better democracy," political observer Hadar N. Gumay said Tuesday at a seminar on political bills.

"The government views these political parties as having many problems, so they want to regulate them better."

The four bills in the package concern political parties, legislative and presidential elections and the composition of legislative bodies.

Hadar, executive director of the Center for Electoral Reform, said that admirable parties would receive votes from the public on their own merit and would not require an attempt to limit competition.

Qualitative improvements for parties, he said, would include more stringent standards for the recruitment of party executives, such as by setting minimum education requirements.

"Another example is to create (higher requirements) for parties' treasurers or financial managers to ensure they are capable of managing a... budget to run the party," he said, adding that political parties are the pillars of democracy.

Several parties have demanded that the government lower the electoral threshold from 3 percent to 2 percent in the new legislative election bill to accommodate smaller parties in the upcoming election.

People's Voter Education Network national coordinator Jeirry Sumampow said the political climate in Indonesia would improve if the electoral threshold was scrapped in the bills. "Naturally, parties who serve their communities better will get more votes and thus are able to exist," he said.

The establishment of new political parties, Jeirry said, should be easy and does not require strict regulation. "What the government should regulate further is the process involving the election, in which it directs parties to be more serious."

The government, he said, must concentrate on furthering the public's political education on day-to-day issues the country faces. Under article 47 of the bill on political parties, sanctions are not given to parties for failing to provide a political-based education to communities, Jeirry said.

Zainal Arifin, a member of the special committee deliberating the political bills at the House, said "uniformity" among parties would resemble the political condition during the New Order era.

"Moreover, changing the electoral threshold would not be effective if parties are able to re-establish themselves easily with new names," said the Indonesian Democratic Party of Struggle representative.

The political bills are scheduled to be endorsed by the House in November.

Parties want lower electoral threshold

Jakarta Post - July 17, 2007

Jakarta Post – Eight religious-based political parties are demanding the government lower the electoral threshold from three percent to two percent in the new legislative election bill to allow the existence of small parties in the forthcoming election.

Article 9 in Law 12/2003 on the legislative election stipulates parties participating in the coming general election must have at least 3 percent of current House membership and at least 4 percent of current regional council membership in 50 percent of the total number of provinces or 50 percent of the total number of cities.

The eight parties demanding the lower threshold are: the United Development Party (PPP), the National Mandate Party (PAN), the National Awakening Party (PKB), the Justice and Welfare Party (PKS), the Peace and Welfare Party (PDS), the Star and Crescent Party (PBB), the Star Reform Party (PBR) and the Democratic Party (PD).

In the 2004 election, PPP gained 58 seats in the House (10,5 percent), PD 55 seats (10 percent), PAN 53 seats (9.6 percent), PKB 52 seats (9.4 percent), PKS 45 seats (8.1 percent), PBR 14 seats (2.5 percent), PDS gained 13 seats (2.3 percent) and PBB won 11 seats (2 percent).

The existing law would eliminate the last three parties from the coming election.

The 2004 election results put both the Golkar Party (128 legislators or 23.3 percent) and the Indonesian Democratic Party of Struggle (109 legislators or 19.8 percent) in the safe area.

"We hope that the government will consider our input. This is to accommodate diversity of a political nature," said Lukman Hakim Syaifuddin, PPP faction chief at the House of Representatives. "We will bring these issues to the next deliberation."

Lukman said they were also demanding political party members could become candidates of the Regional Representatives Council (DPD). The existing law rules DPD candidates must be non-partisan or individual candidates.

He said the parties wanted to maintain the number of members of the House, the Provincial Councils and the regional councils as they were in the existing law – 550 members for the House, 35 to 100 members for the Provincial Council and 20 to 45 members for regional council.

The parties also requested articles on election areas for all legislative bodies refer to the existing law.

Soetrisno Bachir from PAN said the government should let the people function as the selection mechanism. He requested the government not raise the electoral threshold requirement and said any action must be done in stages.

"We have the same point of view, which differs from that of the two big parties," Soetrisno said. "We need to find a solution on this issue."

Ruyandi Hutasoit from PDS said the government would maintain diversity in the political sector by lowering the electoral threshold.

"It's not because our party didn't achieve 3 percent, but to guard political diversity," he said. MS Kaban from the PBB said the government must allow leeway for small parties to participate in the general election by adjusting the related laws.

"Why can't we compose a dynamic law that could last for a long time, so that we don't have to revise it every time we are facing general elections." said Kaban.


Limit urged on military tribunals

Jakarta Post - July 21, 2007

Tony Hotland, Jakarta – Crystal clear jurisdiction of military tribunals is essential in curbing impunity and achieving transparency toward a more professional military, the Indonesian Human Rights Monitor (Imparsial) group noted Friday.

Just as the House of Representatives is of the view soldiers who have committed common crimes should be tried in civilian court, Imparsial said military tribunals should not deal with graft and human rights violations committed by soldiers.

The House and the government are amending the 1997 law on military tribunals in a series of steps toward military reform, following the collapse of Soeharto's 32-year authoritarian regime that relied on the military to sustain power.

President Susilo Bambang Yudhoyono has agreed soldiers who commit common crimes should be tried in civilian court, pending the lengthy amendment of the Criminal Code. But activists say the military community is still resistant to the changes.

"The Military Tribunal Law and the Military Criminal Code must spell out the types of crimes the tribunals are allowed to handle, and it should not include graft and human rights cases," said Imparsial's Bhatara Ibnu Reza.

The House will subsequently amend the Military Criminal Code with a completed amendment of the Military Tribunal Law.

Graft should be left to the Anti-Corruption Court or civilian courts, and human rights cases to human rights tribunals. A clear jurisdiction of military tribunals, said Bhatara, should also include re-positioning the tribunal under the Defense Ministry.

"Being under the military headquarters means we are unable to minimize the influence of command since tribunal officers rely on the headquarters when it comes to pensions, promotions and salaries. They will be easily influenced when working a case," he said.

A review of the discretional rights of supervisors, who have the power to determine punishments in offenses, should also be made effective to make sure authority is exercised in a professional manner, said Bhatara.

"These supervisors decide if an offense is an administrative one and goes to tribunal or not. Unchecked authority is the cause of the impunity we see now," he said.

Imparsial also noted the rights a defendant is entitled to in a military tribunal are fewer than in a civilian court.

Unlike the Criminal Code, the current Military Tribunal Law does not rule on a defendant's rights to contact a lawyer, to access healthcare or a doctor, receive family visits, be tried in an open court or demand compensation or rehabilitation. A military tribunal also is closed to the public.

"Besides jurisdiction and structure, the law needs to look at these very few rights and make improvements," said Imparsial's Donny Ardyanto.

Government told to decide on disputed military land

Jakarta Post - July 19, 2007

Jakarta – President Susilo Bambang Yudhoyono has a few tough decisions ahead of him in the wake of a recent spate of land disputes involving the Indonesian Military (TNI) and civilians.

"The president, as the head of state, must decide who will have the land," Isono Sadoko from the Akatiga Foundation told The Jakarta Post on Wednesday.

Akatiga is a non-governmental organization that specializes in social analysis at which Isono is a researcher.

He said that according to the 1960 Agrarian Law, the state has the right to manage land for the benefit of the Indonesian people. He added that the state must choose between defending the rights of civilians or the military in the case of the current land disputes.

Isono explained that the Indonesian government had committed a major error early on in its agrarian history by allowing the military to confiscate tracts of land held by the Dutch colonial administration in the early years of independence.

He added that even though the civilian government under President Soekarno did not agree to those measures, the government nonetheless failed to determine the true ownership status of the acquired land.

He added that not all the land claimed by the military has been put to use. In many areas, the military land had been left unoccupied, which led to the surrounding communities resettling on it. This eventually led to disputes between the military and civilians.

This situation, he said, has persisted for decades because of the lack of synchronized regulations on land ownership.

"If we refer to the Agrarian Law, it is the people who deserve to own the land. But the military has also claimed the land and recorded it as their asset. The National Land Agency (BPN) must map out all of the military-claimed land and check its status," Isono said.

National Land Agency chief Joyo Winoto said that each allotment of contended land had a unique history and that his office would map all military-claimed land to highlight the areas under dispute.

To land with unclear ownership status, he said, BPN would apply an agrarian reform program.

"We can't just make the military relocate to other plots of land in more secluded areas. We have to look at the problem and the context of each piece of land," Joyo said Wednesday at a press conference on the BPN plan to map TNI land.

Isono said simply reallocating land to the military would not solve the current disputes. Instead, the state must unearth the history of the land to achieve a sense of justice for the people. "If the land was owned by poor people, unless the state has a higher purpose for it, the state should give it back," he said.

Maj. Gen. Abi Kusno, logistical affairs assistant to the TNI chief of staff on general affairs, said the military had more than 3.76 billion square meters of land spread through 12,600 plots, but that only 14 percent of it was certified.

He said that the Rp 3 billion (US$333,333) allocated in the 2007 state budget for the military land certification program was insufficient to process the remaining 3.2 billion square meters of uncertified land.

"This land is located all across Indonesia. If any of it were adjacent to other people's land, it would have the potential for conflict," Abi told the press conference.

Joyo suggested that the government allocate more funds to certify state and military-claimed land through the BPN certification program. "Our office program will facilitate the certification process," he said.

House, government at odds over military ops transparency

Jakarta Post - July 17, 2007

Jakarta Post – Commission I for defense and information at the House of Representatives and the government have agreed to delay the discussion of an article on military operations in the public information bill to find a better formulation for the paragraph.

Most House members said the bill should not limit public access to military operations data, but the government insisted that military operations information should not be opened publicly because it relates to national defense and security.

"Military operations should not be closed from public knowledge because (the operations have) already happened so people have the right to know about them," said Abdillah Toha, a member of the House commission and the National Mandate Party faction, on Monday.

Despite opposition from the House, the government has suggested that among the information to be made publicly inaccessible – through insertion into the third chapter of the bill, which regulates information that cannot be opened to the public – are details about operations, intelligence, tactics and strategies relating to the country's defense system and national security.

The House and the government agree, however, that information concerning witness identities, criminal intelligence, war strategies, data on Indonesia's natural resources and inter- ministerial letters should be hidden from public eyes.

Yuddy Chrisnandi from the Golkar Party said military operations are financed by the people's money and that, therefore, they must be conducted with the people's knowledge. "Most military operations that are closed from the public usually become a serious problem," he said.

"There are many military operations in Indonesia that the government never admits to, but they are there and most of them have claimed the lives of innocent people," Yudi said.

He added that the reason behind his suggestion to open military operations information to the public was so the government could no longer deflect responsibility for the consequences of such operations.

Andreas Pariera from the Democratic Party of Struggle suggested that the government make a list of national defense and security items that it believes should not be made accessible to the public. He said this would inform the people as to the extent of information that is being withheld from them.

The bill, which aims to open as much government-related information to the public as possible, has been under discussion at the House for over five years. If the bill is passed, Indonesia will join 40 other countries that have legislated the right to access public information.

 10 years after the economic crisis

A tale of mistakes piled atop errors

Jakarta Post - July 23, 2007

Vincent Lingga, Jakarta – In early July 1997, when the Thai baht crashed and lost more than 50 percent of its value against the dollar immediately after the Bank of Thailand floated the local unit, Indonesia was an innocent, unaffected bystander, its rupiah stable at around Rp 2,500 to the dollar.

However, what was initially perceived simply to be a baht crisis quickly spread to Indonesia, Malaysia, the Philippines and South Korea, stripping bare their economic and political weaknesses and causing Indonesia to suffer the deepest ever plunge in the value of its currency and the most massive wealth destruction any country had seen since the early 1940s.

Foreign portfolio investors and creditors who got burned in Thailand and suffered from asset inflation, misallocated capital and inadequate regulation of the financial services industry reassessed Indonesian economic prospects against the lessons they learned in Thailand.

The Indonesian rupiah came under strong speculative attack immediately after investors and analysts found that Indonesia's economy had shared most of the diseases that led to the financial debacle in Thailand.

Bank Indonesia initially defended the rupiah by direct market intervention, dipping into its foreign reserves and raising interest rates to tighten money supply.

However, as the demand for dollar did not decrease and the attacks on the rupiah became even stronger after the Philippine peso and the Malaysian ringgit were devalued, Bank Indonesia decided to float the rupiah on Aug. 14.

The float did take pressure off the central bank's foreign reserves, but the drastic move left the currency fully exposed to the negative market sentiment, causing panic among most national businesspeople who had been comfortable for decades with the "crawling" peg of the rupiah, with an annual depreciation of 3 to 5 percent.

Within less than two weeks, amid the scramble for dollars by companies that wanted to retire their foreign debts, the rupiah tumbled to Rp 3,000 and the Jakarta stock market lost a staggering 35 percent from its peak in early July.

Hundreds of companies with unhedged foreign debts but with revenues mostly in rupiah were threatened with insolvency. The central bank's tight money policy – interest rate rose to as high as 30 percent – to encourage investors to hold the local unit made things even worse as Bank Indonesia was completely in the dark about the magnitude of corporate foreign debts.

As the financial condition of most companies and consequently commercial banks worsened, international banks were unwilling to do business with domestic banks, even refusing to accept letters of credit from most Indonesian banks.

The El Nino impact of a prolonged drought in the second semester of 1997 that damaged food crops and plantation commodities compounded the economic woes, thereby setting off a vicious cycle of pessimism and massive capital flight.

The steady rise in interest rates and the steady weakening of the rupiah also revealed the critical weaknesses of corruption, collusion and nepotism – in which most business was done.

In early October, as the rupiah had lost more than 30 percent of its value to hover at Rp 3,800, the government invited in the International Monetary Fund. But the US$43 billion rescue package concluded with the IMF at the end of October failed to improve investor confidence.

In a drastic move that the IMF eventually admitted as a grave mistake, the multilateral institution recommended the closing of 16 insolvent banks, including several owned by members of the Soeharto family.

In the absence of any kind of deposit insurance program, the bank closure panicked depositors and prompted massive deposit withdrawals from most other private banks.

Then president Soeharto instructed the central bank, in contravention of its tight money policy, to inject liquidity (emergency liquidity credit) into troubled and cash-trapped banks in a bid to contain the panic. However, bank runs and capital flight continued.

Bank Indonesia reports showed that from October 1997 to January 1998, cash in circulation increased by a staggering 50 percent and the supply of base money (M1) expanded by almost 40 percent.

The two contradictory policies – massive money expansion and punitively high interest rates at over 60 percent – further damaged the economy, causing the rupiah to fall even lower and consequently doubling consumer prices.

Bank Indonesia reports showed that around Rp 145 trillion in emergency liquidity credits were injected into private banks between October 1997 and March 1998.

But eventual audits found that only about one-third of that amount was paid to depositors as the bulk of the credit was abused by bankers and bank owners to buy foreign exchange and shift assets overseas, to repay subordinated loans of the majority shareholders and to settle derivative contracts.

Hence, much of the ballooning quantity of the rupiah wound up being sold for dollars on the open market and shifted to Singapore and Hong Kong and other offshore locations by Indonesians desperate to get their money out of the country.

The collapsing rupiah and the bankruptcy of most banks and big business groups began to erode Soeharto's political legitimacy.

As 1997 closed, the rupiah had lost almost 75 percent of its value and the stock exchange 80 percent of its market capitalization as many companies and banks simply went bankrupt, millions of people were thrown out of jobs and the severe drought caused fears of food shortages.

The beleaguered Soeharto defied market sentiment and announced in early January 1998 a new state budget that was seen by the market as grossly unrealistic, causing the rupiah to crash through the Rp 10,000 level.

Panicked people rushed to strip supermarkets and grocery stalls bare of rice, cooking oil, noodles, flour, sugar and biscuits.

Soon after, a high-powered IMF team arrived in Jakarta and, in cooperation with the World Bank, revised its rescue package with bolder and painful reform measures.

However, the market reacted negatively to the IMF-World Bank rescue package of Jan. 15, apparently skeptical that Soeharto would implement all the reform measures.

Soeharto again stunned the nation and the international market on Jan. 20, 1998, when he unveiled then big spender minister of research and technology B. J. Habibie as his surprise choice for vice president for the March 1998-2003 term. The rupiah fell through the Rp 17,000 point on Jan. 23.

Market sentiment was further damaged when Soeharto, fresh from being reappointed to the 1998-2003 term in mid-March, announced a crony Cabinet lineup that included his eldest daughter and notorious businessman Muhammad Bob Hasan.

The president incited massive street protests when on May 5 he went ahead with raising fuel prices by more than 70 percent as part of the reform measures agreed to with the IMF.

Street demonstrations and rioting which started immediately in Medan, North Sumatra, quickly spread to cities in Java and exploded into a bloody incident in Jakarta on May 12, with four students from Trisakti University killed by troops.

This tragedy set off massive rioting and looting in Jakarta on May 14 and 15 and eventually led to the fall of Soeharto on May 21, 1998.

The Indonesian crisis is thus a tale of mistakes piled atop mistakes, misjudgments by the IMF and the Indonesian government, and bureaucratic wrangling between the IMF and the World Bank.

[The author is a staff writer at The Jakarta Post.]

The Asian Crisis - Why was it so much worse here?

Jakarta Post - July 23, 2007

James Castle, Jakarta – For anyone involved in business or policy in developing Asia, the boom and bust of the 1990s are the defining events of the last twenty years. A decade has passed since the floating of the Thai Baht on July 2, 1997 precipitated a series of currency devaluations and other financial catastrophes that are now collectively known as "The Asian Crisis".

Indonesia was the worst hit of the five crisis countries – Thailand, the Philippines, Malaysia and South Korea – so it is appropriate to revisit events of the time in an effort to understand why it was so much more severe here.

While there remains much lively argument over the relative weights that should be assigned to various factors identified as causes of the crisis, many agree the most important factors were loose credit conditions and fixed exchange rates that encouraged risky short term foreign currency borrowing to fund long term domestic fixed asset acquisition. But this applied to all of the crisis-hit countries to greater or lesser degrees. And in this regard, Indonesia was far from the worst offender. If so, why was our fate so much worse? What was so different here?

The answer to this most important question is to be found in the crony-capitalism that was at the heart of the New Order system. While it admittedly generated nearly three decades of unprecedented growth, it also contained at its core, fundamental abuses that made a serious financial crisis all but inevitable.

While excessive concentration of ownership existed in the other crisis countries, the modern business sector was much more concentrated in Indonesia. And the situation here was even more dangerous because of the emergence in the late 1980's of a truly untouchable clique of rent-seekers more powerful and protected than all the other cronies combined. This was the Soeharto family clique.

President Soeharto was trapped in the unhappy position that dramatic changes were needed to stabilize the economy yet these changes threatened the very heart of the personal financial empires of his children. Virtually all technical advice aimed at avoiding crisis or mitigating its impact pointed in this direction and therefore became immediately suspect and unacceptable. While it is possible to imagine a ruthless Soeharto sacrificing any or all of the large crony conglomerates to save his government and his legacy, he could never sacrifice his family.

Indonesia was caught in a perfect storm in 1997. It had an aging and increasingly isolated leader who was a victim of both the demand for change that came from his own policy successes and the financial excesses of his selfish and undisciplined children.

Indonesia's rigid authoritarian system that had worked so well for 30 years and brought so much economic progress had become increasingly brittle as Soeharto listened less and less to the external advisors who had served him so well for so long and more and more to his immediate family and their sycophants, desperate to protect their short term financial interests and preserve their privileged position atop Southeast Asia's richest economy.

One of the enduring images of the crisis is the photo of a grim- faced Michael Camdessus, Managing Director of the IMF, standing with arms crossed as the seated Soeharto signs the acceptance of the latest list of IMF demands. The photo was to quickly become an iconic symbol of Soeharto's humiliation and, by extension, the humiliation of all Indonesians, even those who wished Soeharto gone.

The irony of the photo is that in other affected countries finance ministers, not the heads of state, signed similar IMF documents. But at the time of this signing Soeharto no longer trusted his financial ministers whose advice now always ran against family interests and presented politically dangerous challenges to his iron rule. So in a colossal lapse of judgment – the kind a younger, healthier Soeharto never made – he signed the documents personally, at a stroke bringing humiliation upon himself and his country.

Protecting his children was synonymous with protecting his system. Unfortunately, the system he struggled to protect was one that, according to the IMF and others, had concentrated more than half of the modern domestic corporate structure in the hands of perhaps no more than ten families, including Soeharto's own. Such a structure meant that risks were poorly diversified and regulatory and corporate governance weaknesses were compounded.

Virtually all of these privileged cronies owned banks that had related-party lending far in excess of regulatory limits. Post- crisis analysis has shown that about half of the lending of failed banks that had to be taken over by the government was intra-group, a devastating regulatory failure.

The underlying weaknesses in the corporate sector and the flaws in the financial system upon which the crony capitalists relied caused Soeharto's fatal blunder, the mismanagement of 1998 liquidity support credits that were intended to assist healthy national banks suffering from liquidity problems.

Most of the liquidity injections went to banks that were far from healthy and had excessive amounts of related party (crony) loans. Much of the liquidity credit went directly to support bank customers that were actually part of the same group as the bank owners, leaving depositors and the government holding worthless or greatly devalued assets when the banks ultimately collapsed.

The temptation for abuse was excessive and did not meet serious resistance. Because of inappropriate related party lending, owners of large private banks were incentivized to funnel the liquidity credits to prop up their biggest customers, that is, themselves. The funds were quickly shifted to ailing local corporations and then sent abroad in hard currency to escape the grasp, however feeble, of other domestic creditors, the largest of whom ultimately became the Indonesia people through its failed government.

Thus, the major reason Indonesia suffered so much more than other crisis countries a decade ago was the systemic concentration of the assets of the modern business sector in the hands of a tiny, untouchable clique causing an ill and aging dictator to confuse saving their interests with saving the national economy.

Today, much has changed for the better. Ownership of private sector assets is now much more diverse. Indonesia's banks are much better managed and Bank Indonesia supervision is tighter and independent. The blatant misbehavior of the past can no longer occur in a systemic fashion. Dangers, however, always exist in the financial environment.

The next crisis will probably result from vulnerabilities that we do not fully recognize at present. This will be the subject of a later column. But because of changes made to date, particularly more diversified ownership, better financial supervision and greatly reduced related-party lending, Indonesia is much better placed to weather the next financial storm. It will not originate here and we will not be harmed disproportionately.

[The writer is a businessman who has lived and worked in Indonesia since 1977. He is a past Chairman of the International Business Chamber of Indonesia and Amcham Indonesia.]

Indonesia's monetary crisis and the long road to renewal

Jakarta Post - July 23, 2007

John A. Prasetio, Jakarta – A decade ago, almost without warning, the Asian economic crisis arrived to challenge the "East Asia Miracle" thesis of the World Bank. Indeed, in the spring of 1997, the Organization of Economic Cooperation and Development (OECD) predicted that East Asia could continue to average 7 percent annual growth for decades. Ratings on Asian debt by international agencies were rock solid, and financial analysts were extremely bullish on Asia.

Following the meltdown, some commentators were quick to reverse their earlier description of East Asian policies as market friendly, and identified crony capitalism, dubious business practices as well as poor corporate governance as being responsible for the crisis. Asian values, which were previously praised as the driver of the rapid growth in East Asia were also blamed as a source of critical weaknesses in governance.

By early 1999, however, as the contagion infected Russia and Brazil, the focus of analysis increasingly shifted to external factors, particularly the role of short term and speculative financial flows, as well as the herd behavior of fund managers.

Up to the first half of 1997, foreign banks aggressively increased their lending in Indonesia, Thailand and Malaysia, but in the second half of 1997, in a short span of time, they pulled out an estimated US$34 billion, almost 10 percent of the afflicted countries' GDPs.

Indeed, the IMF bailout packages are also said to have turned a market correction into a full blown meltdown. Not less than Joseph Stiglitz, former chief economist of the World Bank, had come to argue that IMF conditions for financial assistance were counterproductive, and it was a mistake to jack up interest rates in the crisis-hit countries, insofar as this strategy had pushed highly leveraged companies into bankruptcy, and triggered a massive capital exodus by terrified foreign lenders and investors. In addition, pushing the authorities to close faltering institutions had the impact of sparking panic and massive bank runs, instead of restoring investors' confidence.

The Susilo Bambang Yudhoyono-Jusuf Kalla administration, installed at the time Indonesia was on its way to recovery in 2004, has defined its agenda of moving Indonesia to the new space of a stable nation, united and peaceful, with a pro-growth, pro- job and pro-poor economic strategy. And yet today, Indonesia has not completely abandoned its old, pre-crisis world of high cost economy with red tape, complex regulations and incoherent policies.

Despite policy reform packages which have begun to gain momentum, Indonesia is not quite yet inside the new zone of strong governance, increased competitiveness and robust economic fundamentals. While the rule of man has been swept away, the rule of law has yet to become firmly established. While the banking sector has been strongly capitalized, and corporations have improved their balance sheets, access to credit has become profoundly difficult.

Following the crisis, the regulatory environment provided disincentives for the banking sector to lend "recklessly." Banks have also become more conscious of not getting into a "moral hazard" situation, and thus the willingness of commercial banks to aggressively book loans has become very much restricted.

In fact, banks have been cutting back on lending except to the best borrowers. As a result, the role of commercial banks as financial intermediaries has been limited with a big portion of the excess liquidity in the banking sector being invested in Bank Indonesia bills as opposed to being channeled to the real economy.

In addition, in the post-crisis period, half of the banking sector in Indonesia is foreign owned, and these banks impose stringent global governance standards not only on their operations, but also on the corporations that do business with them.

At the height of the crisis, when the asset bubble burst, new investors snapped up distressed firms, including recapitalized banks, at attractive prices. In early 2005, Altria consummated its deal in which Sampoerna was valued at US$5 billion, as opposed to less than $500 million at the time of the crisis. This transaction was praised as a fair deal.

By the same token, many other acquisitions before 2005 are now perceived to have been conducted at far below the true worth of the assets. While this has become very much a politically sensitive topic, the fact is that many of the new investors have injected leading edge technology, and stronger managerial skills as well as technical competencies that enabled a strong turnaround of those acquired firms.

Since 2003, the benchmark index of the Jakarta Stock Exchange (JSX) has bounced back. The return of foreign funds, and excessive domestic liquidity have pushed the JSX index to a record high that surpassed the 2000 mark in April 2007. Nevertheless, when foreign portfolio capital left in mid-2005, the JSX index declined, and Indonesia experienced a mini currency crisis.

Subsequently, a surge in foreign funds resumed in October 2005, following the government's decision to make a move on oil prices. Today, our equity market is 70 percent controlled by foreign investors, and there are renewed debates on how to prevent possible destabilizing episodes of massive flow in portfolio capital.

Obviously, mishaps can always happen, but Indonesia today is less prone to a sudden reversal of inflows than a decade ago: we have stronger banking systems, flexible exchange rates, and respectable balance of payments. We have also built record high foreign reserves as insurance against future financial crisis.

On the other hand, Indonesia continues to show a poor record in improving the business conditions necessary for attracting foreign direct investment. In fact, the May 2007 edition of IMD's World competitiveness Yearbook put Indonesia's competitiveness performance near the very bottom of the 55 economies surveyed. It is obvious that a relentless reform mindset will need to take hold for capital flows to our economy to be stronger, and less volatile.

Ten years after the crisis, Indonesia's corporate sector is still finding its way to a stricter governance regime. Securities laws and listing requirements have actually been strengthened, and the media are more inquisitive and probing. Yet, many companies remain ambivalent to the value of good governance in the face of underdeveloped judicial systems. In some companies, board practices follow the letter rather than the spirit of governance codes.

Nevertheless, some corporate captains have come a long way: Not only have they restructured their business to make it more transparent, they have also changed their mindsets. These corporate leaders are now focused on their core competencies, and they no longer relentlessly pursue market share without regard to profitability and shareholders' value.

To sum up, for Indonesia, the journey to renewal has been long and painful. Much progress has been made, and yet much work remains to be done to strengthen our capacity to withstand another crisis of globalization, and to accelerate growth. The banking sector has cleaned up their balance sheet, but a big share of their lending is going to consumers rather than corporations.

Indonesia was a central destination for FDI before the crisis; today, our records for FDI inflows are not outstanding. While portfolio inflows have bounced back, our stock exchange is still relatively small, and many mid sized companies are not really motivated to list their shares. Widespread cronyism is probably a thing of the past, but for the moment, the search for effective governance looks like a long road indeed.

[The writer is chairman of CBA Asia and vice president of the Indonesian Chamber of Commerce and Industry.]

Did the IMF get the crisis right?

Jakarta Post - July 23, 2007

Binny Buchori, Jakarta – What do we remember about the economic crisis of 10 years ago? Some of my recollections are: Fluctuation of the rupiah's value against the U.S dollar, increasing prices of almost all goods, people rushing to grocery stores, fighting to buy food and household goods that were difficult to find, bank closures causing panic beyond measure all over the country, followed by private enterprises closing due to bankruptcy, causing a dramatic rise in unemployment.

Probably to most Indonesians at that time, the feeling was that of shock and great uncertainty. How would one know that Indonesia's economy, which for so many years looked robust and gave the impression of stability, would suddenly become so volatile?

Analysts have produced many reports and studies as to why Indonesia's economy hit rock bottom during the crisis. Some of the issues often discussed as the cause of the crisis are corruption, bad governance and weak fiscal policy.

The economic crisis did hit Indonesia very badly. One illustration is the soaring external debt. The country struggled to pay its external debt, which increased dramatically from $129 billion in 1996 to $151.2 in 1998. Consequently, the ratio of external debt to GDP also increased from 58.3 percent in 1996 to 167.9 percent in 1998. With this huge debt stock and debt burden, Indonesia sacrificed its resources for servicing the debt.

It is therefore not surprising that Indonesia's crisis has been described as very costly.

To overcome the crisis, the Indonesian government, among heated debate and arguments, asked the International Monetary Fund to come to Indonesia, with the belief that Indonesia's economy would recover. The IMF came with a $43 billion bailout as a standby loan.

The heated debate was not baseless, because many Latin American countries and African countries experienced IMF programs in the 1980s and 1990s, when they suffered from financial crises, and there was evidences that IMF programs for tackling economic crises in these countries were not always successful.

There are at least three myths about IMF programs: First, that they bring new private investors to the countries. Second, that they increase investor confidence. Third, they stabilize exchange rates.

The IMF program comes with conditions, known as the Structural Adjustment Program, aimed at generating savings and foreign exchange to fix the balance of payment and facilitate debt repayment. The principle of this is financial stabilization by imposing strict fiscal and monetary discipline. This approach makes fundamental changes in the way the state functions.

The IMF requires the government to be more efficient, so that it has to cut subsidies, including subsidies for fertilizer, oil, education and health. The government also has to allow the market to have a bigger role in the economy through the privatization of state-owned enterprises, including water, telecommunications and power firms.

Indonesia also had to allow the country to integrate further with the global market by reducing import tariffs and opening up the domestic market to imported goods and international retailers. The government was also obliged to allow the free flow of capital.

Once a country decides to seek a bailout from the IMF, it has to deal with sectoral adjustments, which are facilitated through lending from multilateral and bilateral creditors. In Indonesia, for example, the World Bank, released a huge loan called the Policy Reform Support Loan I, amounting to $1 billion.

The ADB gave Indonesia a Financial Guarantee Reform, amounting to $1.5 billion, to develop all necessary regulations and policies for privatization and deregulation in Indonesia.

Did the prescription work? As experienced in Latin America and African countries, the Structural Adjustment Program created a number of problems. Financial liberalization in Ecuador, combined with the absence of good governance, led to financial crisis and made the government use more than $7 billion of public funds to bail out banks. (Structural Adjustment: the SAPRI Report: the Policy Roots of Economic Crisis, Poverty and Inequality, Zed Books, 2004).

In Indonesia, the public, during the IMF program and in the post-IMF period, experienced an increasing cost of living and witnessed a flood of imported goods, from agricultural products to second-hand clothing, as well as international retail businesses.

The flow of agricultural products came as a consequence of the lifting of import tariffs, which at the same time made Indonesia become a net importer of food. In 2003, Indonesia experienced a trade deficit of $1.4 billion in food crops and $134.4 million in livestock (Witoro: Memperdagangkan Kehidupan, Menelisik Nasib Beras di bawah Pasal-Pasal WTO in Globalisasi Menghempas Indonesia, LP3ES and Perkumpulan PraKarsa, 2006).

Meanwhile, the prescription of financial stabilization actually created financial destabilization, as shown in the case of the closure of 16 banks with no proper preparation, which resulted in capital outflow amounting to $5 billion.

On this issue, the Independent Evaluation Office (IEO) of the IMF admitted it made a mistake. In the report, The IMF and Recent Capital Account Crisis, Indonesia, Korea and Brazil, 2003, it stated that the IMF misjudged the severity and the macro-economic risks in the banking sector.

The intervention lacked a comprehensive bank restructuring strategy and thus the closures deepened the crisis. The report also admitted the IMF failed to understand the different situations in Brazil, Indonesia and South Korea, and yet applied the same remedy.

In Brazil, the IMF identified correctly the problem: macro- economic imbalance, because that is the expertise of IMF. But in Korea and Indonesia the crisis was caused by weak financial corporate sectors, and the IMF failed to produce an accurate assessment.

The IMF and World Bank gave the same prescription that they gave to Latin America and African countries even though the circumstances were very different. And the public experience in these countries suggests that the remedy does not always work.

The admission of the IEO reaffirms that they made a the mistake. But the irony is that despite the mistake, Indonesia cannot hold the IMF accountable. Indonesia paid its debt to the IMF in full, no reductions, and there were no sanctions for the institution.

This reaffirms the opinion that it is time that we reformed the governance of the IMF, so that it is transparent and accountable. One of the recommendations from the High-Level Panel on IMF Board Accountability, comprised of scholars, former IMF staff and activists, released in April 2007 by the New Rules of Global Finance, a non-profit organization based in Washington DC, is that IMF should have an external complaint mechanism in the form of public sessions, which would allow the public to review some of the controversies such as the Asian financial crisis. This would lay down the foundation for the IMF's accountability and would help avoid the same mistakes from being made.

It can be said that the "one size fit all" approach of the International Monetary Fund in tackling the crisis did not work.

The Indonesian crisis should teach all of us that deregulation, privatization and liberalization may not be the one and only solution for crises. To avoid the same mistake in the future there should be a reform in the governance of international financial institutions.

[The writer is executive director of Perkumpulan PraKarsa.]

 Economy & investment

Government reveals unemployment reduction plan

Jakarta Post - July 21, 2007

Urip Hudiono, Jakarta – The government hopes to reduce unemployment and poverty by diverting some routine spending in 2008 to help finance infrastructure development in the regions.

"The higher spending on infrastructure will help spur faster growth, and drive that growth in the direction we want, which is one that creates more jobs and increases earnings among the poor," Coordinating Minister for the Economy Boediono said Friday. "We will start working on this this year, so that the results can be felt in 2008."

The government plans to divert up to Rp 30 trillion (US$3.3 billion) in routine spending from the 2008 budget to capital expenditure, State Minister for National Development Planning Paskah Suzetta said after a meeting Thursday evening between Vice President Jusuf Kalla and the government's economic team.

The cutbacks will mostly affect routine ministerial spending on items deemed excessive, such as travel and seminar costs, with the money then being spent instead on infrastructure projects such as roads and bridges in the regions, Kalla said.

In its mid-year budget revision proposals, the government has proposed a reduction in both routine procurement spending to Rp 62.5 trillion from the Rp 72.1 trillion budgeted at the beginning of the year, and capital procurement spending to Rp 68.3 trillion from Rp 73.1 trillion.

The government hopes to lower Indonesia's open unemployment rate to 5.1 percent by 2009, and the poverty rate to 8.2 percent.

Open unemployment as of the end of February stood at 9.7 percent, slightly down from 10.4 percent a year ago. Meanwhile, Indonesia's poverty rate as of the end of March had similarly decreased to 16.6 percent from 17.7 percent.

Indonesia's economy needs to grow by more than 7 percent per annum to meet the government's unemployment and poverty targets. To achieve a growth rate of 7 percent, the country will need at least $111 billion in new investment this year.

The economy grew by an on-year rate of 6 percent in the first quarter of the year, after slowing down slightly to a full-year 5.5 percent last year from 5.6 percent in 2005.

The Finance Ministry estimates that growth will hit 6.1 percent in the first half, and 6.3 percent for the full year, as targeted. Earlier, Kalla had said that Indonesia should be optimistic about achieving 7 percent growth next year and 8 percent in 2009.

Boediono said Indonesia that Indonesia had been making slow but steady progress in improving the quality of economic growth through increased investment.

"All the economic indicators are showing an increase in investment, accompanied by reductions in unemployment and poverty," he said.

"Investment in particularly improves the quality of our economic growth, because its multiplier effect in creating jobs is greater compared to growth that is built only on consumption."

Nevertheless, Bank Indonesia Governor Burhanuddin Abdullah warned recently of the danger of a widening gap between the haves and the have-nots, and growth that had done little to help reduce unemployment and poverty.

He said how that higher inflation in 2006 had cut into the purchasing power of the poor, while the rich were able to compensate for this by gaining from the boom in portfolio investments and high interest rates.

Confidence in economy up, says survey

Jakarta Post - July 23, 2007

Urip Hudiono, Jakarta – Recent improvements in Indonesia's macroeconomic indicators are bringing about confidence in the economy as a whole, with the central bank's latest survey showing estimates of higher growth built on more investment and a continued increase in bank lending for the year.

With inflation having been kept in check, coupled with a fairly steady rupiah, the economy is expected to have expanded between 5.1 and 6 percent on-year during 2007's second quarter, and is expected to continue growing at the same levels throughout the year.

Growth may even reach 6.47 percent as investments and exports pick up further, according to a quarterly survey on the economy that Bank Indonesia conducted. The survey involved 100 economists, market analysts and academics in 13 major cities throughout the country.

The survey says that local and foreign investments will increase during the second half of this year, as Indonesia's exports grow by between 15.1 and 22.5 percent.

The higher investment will echo robust activity in the country's main economic driver, consumption, which will be supported by relatively stable consumer prices, while the rupiah remains between Rp 9,001 and Rp 9,500 to the US dollar, creating a stable environment for trade activities.

Inflation may still affect growth in consumption and investments if the government fails to manage the demand and supply of goods and services, as well as consumer price expectations in the country, the survey said.

Problems with graft and the rule of law are other factors which may have adverse effects on growth.

The government is expecting 6.3 percent full-year growth for 2007, and 6.6 percent for 2008, on inflation of 6.5 percent.

Indonesia's economy only grew by 5.5 percent last year, slightly lower than 2005's 5.6 percent, due to a rise in inflation and interest rates from fuel price hikes.

In a separate survey conducted of all Jakarta-based banks, lending from the banking sector is expected to continue rising in the third quarter of 2007 on lower interest rates.

Bank lending in the second quarter had grown along with rising demand, the survey showed, with only 34 percent of banks having failed to meet their quarterly lending targets, while only 13 percent of total loan applications in the period were rejected.

Most of the lending was in the form of working capital loans in the trade industry and consumer loans for mortgages, picking up on the recent trend of lower lending rates.

The average lending rate for working capital loans decreased slightly to 14.2 percent in the second quarter, from 14.5 percent in the first. The interest rate on consumer loans, however, saw an uptick to 16.9 percent from 15.9 percent.

Lending rates are expected to come down again in the third quarter to 13.9 percent for working capital loans and 16.5 percent for consumer loans.

This is expected to further spur bank lending to drive the economy, which according to data from Bank Indonesia reached Rp 856 trillion as of the end of May.

The central bank is for 2007 expecting bank lending to grow between 18 and 20 percent, from 14 percent to Rp 792 trillion last year.

House ignores anger over CSR duty

Jakarta Post - July 20, 2007

Andi Haswidi, Jakarta – Despite strong protests from the business community, the House of Representatives will press ahead with its plan to make corporate social responsibility (CSR) legally mandatory, albeit in a diluted form.

The article on compulsory CSR in the corporations' bill will be retained, despite the protests, but will be confined to resource-based industries, the deputy chairman of the corporations' bill working committee, Choirul Saleh, said here Thursday.

"The special committee approved the corporations' bill yesterday and it will be passed as scheduled on Friday," Choirul told The Jakarta Post.

The revised article states that all companies engaged in the exploitation of natural resources must conduct CSR programs, and will be punished if they fail to do so.

Choirul said that the money used to fund a CSR program would be considered to be part of the company's annual operating costs, and so could be set off against tax.

As for actual figures on the amount of funding that would have to be devoted to CSR, and the sanctions for non-compliance, these issues would be provided for in the new legislation's ancillary regulations.

Initially, the CSR obligation, as stipulated in the bill, applied to a much broader range of businesses, and involved a mandatory contribution of up to 5 percent of a company's net profit.

The inclusion of the CSR requirement at the initiative of the House has been heavily criticized by many as violating the philosophical basis of CSR.

"CSR programs should be voluntarily. They should not be made a corporate responsibility," Indonesian Employers Association (Apindo) chairman Sofyan Wanandi told the Post.

Sofyan argued that CSR, by its very nature, was a voluntary measure instituted by firms in order to help achieve sustainable development through various types of program that benefited all stakeholders. Sofyan said that the decision to consider CSR spending as part of operating costs, as provided for in the bill, could backfire on the state as it could encourage tax evasion.

"Some companies could abuse it by allocating large sums for CSR programs so as to swell their operating costs and thereby reduce their tax liabilities, while all the time keeping the money for themselves," he said, adding that government control would no doubt be ineffective, going by past experience.

Earlier this week, the Indonesian Chamber of Commerce and Industry (Kadin), Indonesian Business Links and dozens of other business associations issued a joint statement saying that making CSR obligatory violated the principles of good governance and best practice, and was, in fact, inimical to the concept of CSR itself.

Despite the criticism of the CSR aspect, Choirul said that the corporations' bill offered a new dawn for corporations in Indonesia, both local and foreign.

"The bill provides for faster registration of companies as it puts in place the necessary legal framework for computerized processing. Another example of progress is that it allows shareholders' meetings to be conducted using teleconferencing facilities," he explained.

In a separate move that could further burden industry, the House is currently preparing to deliberate a bill on local taxes.

The bill, which is sponsored by the government, proposes that local governments be given the right to levy what is referred to as an "environmental tax" on companies with total sales worth more than Rp 300 billion (about US$33 million) a year, other than companies operating in the food processing industry. The amount of the tax will be capped at 0.5 percent of total operating costs.

 Opinion & analysis

Indonesia risks going green

Asia Times - July 23, 2007

Bill Guerin, Jakarta – Indonesia is now formally on the vanguard of the global green energy movement. A new energy law approved last week aims to reduce significantly the economy's dependence on imported refined oil while boosting the use of other energy sources, including natural gas, biofuels and geothermal supplies.

The law mandates the establishment of a National Energy Board, chaired by the president, which will carve out policies and oversee development in the energy sector. The new law also stipulates that a strategic reserve in both conventional fossil fuels and renewable energy resources, such as bio-diesel, will be maintained and penalties will be imposed on industrial energy users who ignore conservation. Those who promote it, on the other hand, will be given incentives.

The new scheme includes a dramatic altering of the national energy-use mix, with renewable energy sources, currently 5%, accounting for more than 17% of total supply by 2015. Over the same period, the use of oil is scheduled to be reduced from 52% to 20% and alternative fossil fuels such as natural gas and others to more than 60%.

While earning a US$1.36 billion surplus in crude-oil trading last year, at the same time Indonesia net-imported $8.66 billion worth of refined oil products. That energy trade deficit resulted in the government paying Rp60.5 trillion ($6.6 billion) in fuel- price subsidies.

The new policy includes incentives, such as government financial assistance, for private and state companies involved in the distribution and utilization of renewable energies, including biofuels. That's potentially good news for the foreign investors and politically connected local companies that have recently piled into biofuel production, including state-owned oil-and-gas utility Pertamina.

Pertamina currently has an in-country monopoly on biofuel distribution, but has run up heavy losses because biofuel is still more expensive than subsidized gasoline and diesel at the pumps. As global oil prices hit new 10-month highs of about $75 per barrel, Indonesian policymakers are keen to reduce the national fuel bill and move toward more energy sufficiency.

But questions abound about whether the enforced use of more environmentally friendly energy sources makes economic sense. Indonesia is close to overtaking Malaysia as the world's largest producer of crude palm oil (CPO), the most commonly used feedstock for bio-diesel, the biofuel that is blended directly with conventional petroleum-based diesel.

The yield from Indonesia's CPO plantations is way ahead of most other tropical biofuel options, including coconut and castor oil. Yet biofuel is viable only as long as global crude-oil prices stay above $60 a barrel, economists say. If prices were to return closer to their historical moving average, the biofuel drive's economics would be dubious.

Not only does the long-term sustainability of biofuels depend primarily on the future price of oil, but biofuel production is also potentially destructive to the environment through clearing pristine tropical forest areas for plantations.

The threat of food insecurity is one that haunts Indonesia perhaps more than any other country in the region. Domestic cooking-oil prices have this year risen by almost 30% after an 80% rise in CPO futures offshore. Indonesian CPO producers are understandably chasing profits abroad, despite a government bid to stabilize domestic cooking-oil prices through an export-tariff increase of more than 400% imposed last month on CPO and related byproducts.

Meanwhile, nationalist sentiments are gaining ground that foreign companies are disproportionately profiting from Indonesia's natural resources. Those sentiments are expected to be a major factor in the run-up to general elections, which are scheduled for 2009.

However, anti-foreign rhetoric also helps mask the reality that while major foreign investments have recently piled into biofuels, politically connected local companies are grabbing ever larger chunks of the country's energy business, particularly in biofuels. Analysts say that helps to explain the substantial financial assistance for companies involved in the distribution and use of renewable energies included in the new energy bill.

Major investments aimed at leveraging existing green energy incentives and policies had already piled into the CPO plantation sector and processing facilities. The biggest Indonesian biofuel deal to date, worth $5.5 billion, was struck in February among Sinar Mas Agro Resources and Technology, a subsidiary of the Sinar Mas Group, China's state-owned oil company CNOOC (China National Offshore Oil Corp), and Hong Kong Energy.

Still, there are several significant barriers to boosting renewable-energy use and promoting energy conservation. Among them are the high costs of investment, the lack of an efficient distribution infrastructure, and the sea-change in consumer attitudes required to persuade Indonesians to care about saving energy. These factors, analysts say, could all slow the government's ambitious new alternative-energy targets.

Despite declining production, the oil-and-gas sector is still a key contributor to national coffers, particularly when world oil prices are high. Oil and gas revenues made up about 23% of total domestic revenues for 2006, according to data from Bank Indonesia. All told, oil and gas revenues, including income from oil and natural-gas exports, royalties and taxes, reached $22.5 billion, up 17% from a year earlier.

Yet the downside of higher oil prices is that they cost Jakarta more in fuel subsidies and in the substantially higher prices the country must pay for imported fuel products. These subsidies, as well as being a burden on the Indonesian taxpayer, encourage wastage of energy and work at cross-cutting cleavages with the energy-conservation cause.

About Rp42 trillion was allocated in 2006 to subsidize the price of 10 million kiloliters of kerosene, the average level of national annual consumption for household use. A government report issued last year concluded that 83% of direct fuel subsidies were enjoyed by the 60% of Indonesians in the highest income group, while only 40% of the lowest income group received only 17% of the calculated benefit of these subsidies.

Energy subsidies for the poor, including for cooking fuel and public transport, will be continued under the new law. While using oil subsidies as a crude vote-buying technique is nothing new, President Susilo Bambang Yudhoyono won widespread praise among economists in 2005 for making some of the biggest cuts in energy-price subsidies in global economic history.

Yet the marginal impact on the poor of the rising prices that followed subsidy cuts was a sharp blow to confidence in his government's promise to reduce poverty rates substantially. The new energy bill and its stated aim to green Indonesia are unlikely to deliver big economic benefits any time soon, particularly considering the apparent flaws in the policy.

Last year the government said no more subsidy cuts were planned at least until the end of this year. Yet the temptation for populist measures ahead of what are expected to be hotly contested 2009 polls is likely to become increasingly acute. Those political realities could still result in a swing away from the government's new alternative-energy commitments – despite its progressive intentions.

[Bill Guerin, a Jakarta correspondent for Asia Times Online since 2000, has been in Indonesia for more than 20 years, mostly in journalism and editorial positions. He specializes in Indonesian political, business and economic analysis, and hosts a weekly television political talk show, Face to Face, broadcast on two Indonesia-based satellite channels. He can be reached at softsell@prima.net.id.]

Indonesia reinvented

Jakarta Post Editorial - July 23, 2007

As Asia this month marks a decade since the region went into a deep financial crisis, one might well ask, what exactly has Indonesia been doing these last 10 years? The short answer is that we have been reinventing ourselves. The slightly longer answer is that this has been a difficult and painful process, and that we have had mixed results. Skeptics feel we have achieved little, but the more optimistic among us feel we have made quite significant progress. Everyone agrees however that we still have a long way to go.

If former president Soeharto was mentally fit (which he is not, according to his lawyers' claims in a court of law to spare him from criminal prosecution), he would not recognize the Indonesia that he built during his 32 years in power only to destroy at the end of his reign.

Indonesia today, for better or worse, has been dramatically transformed in the last 10 years. It is now a totally different country in many respects from the one that Soeharto left behind in May 1998, when he was forced to step down.

This is now a country where the leaders are being made accountable for their actions and must routinely seek a mandate from the people; a country where those in leadership position are constantly being watched and scrutinized by the public.

It's a country where differences of opinions are respected and where everyone is free to think and to express themselves without fear of persecution. Our basic human rights are also much more respected and guaranteed than they were before.

This is a new Indonesia where political power is no longer concentrated in the hands of one person, but instead is shared with other individuals and institutions. It's an Indonesia that has been decentralized thoroughly to the lowest levels of the administration, thus giving people in the regions more say in running their own affairs.

It's an Indonesia where the police's main job is to protect and to serve, not to intimidate or beat up the people, and where the military is confined to dealing with the nation's defense and is removed from politics, and made much more accountable. It is also a country where the economy may remain weak (especially relative to its neighbors), but is on a much more solid foundation than the one Soeharto left behind.

If you had entertained any of these notions of Indonesia during the Soeharto years, you would have been called a romantic utopian.

Indeed, Indonesia has come a long way from the days when the country spiraled into chaos after catching the Asian currency contagion that broke out in Thailand in July 1997. Indonesia came off worse than other Asian countries like Thailand, Malaysia and South Korea. The financial crisis led to a wider economic crisis that in turn caused a political earthquake that forced Soeharto out of power. In the ashes of his New Order dictatorship, we started laying down the building blocks of a new Indonesia.

Progress has been too incremental for anyone who lives in Indonesia to really feel the difference. As then US ambassador to Indonesia Ralph Boyce said in 2003 about the transformation in Indonesia, "it is moving at a glacial speed", but over the years the changes have added up to quite a lot.

Yet, in many other respects some things remain unchanged. Corruption is as rampant as it was during the Soeharto years, if not more so, even as many people have been tried, convicted and sent to jail for the crime. Some people and institutions have yet to learn to respect our differences, and prefer to settle them the only way they know how, through the use of violence.

It's still an Indonesia in which our leaders endlessly bicker over minor issues but leave the more difficult and substantial matters unresolved. It's an Indonesia where justice for many remains elusive. Though cases of human rights violations are rare these days, perpetrators of past violence still roam free, as do many of the Soeharto disciples and henchmen. Impunity remains the order of the day for the politically and economically powerful, even as we try to impose the rule of law.

For many, it is also a country where they are actually worse off in economic terms than before.

The number of people living in poverty may have declined from the peak of the economic crisis in 1998 but it is still higher than what Soeharto once achieved. More people than ever are out of work. Sending your children to school is now an expensive affair, and university is practically out of reach except for the rich.

No one ever said reform would be easy and painless, but no one warned us it was going to be this difficult, and that the price we would have to pay would be so high, especially for those who remain trapped in the vicious cycle of poverty and unemployment.

We can't turn back the clock. The Asian currency contagion 10 years ago, and the powerful tsunami that it unleashed, especially in Indonesia, have become part of our history. If we knew then what we know now, we could have handled the situation better and made the changes more palatable.

That's probably the most valuable lesson of all as we mark the first decade since the Asian financial crisis. We can't change the past, but we have the power to determine and reinvent our future. Let's move on. At least we know we are on the right track.

A timid law for Jakarta

Jakarta Post Editorial - July 21, 2007

The newly passed Jakarta Special Administrative Law can be seen as promoting democracy in Jakarta, though only timidly, but lacks all the articles to necessary to transform Jakarta into a modern, humane metropolitan city.

The new law is sure to be more supportive of democracy than the 1999 law that it replaced. The 1999 law stipulated that the Jakarta governor and his or her deputy were elected by the Jakarta Legislative Council, or the DPRD, while the new law requires the governor and deputy to be directly elected by the people.

By adopting direct elections for governor and deputy governor, Jakarta is now on par with other provinces in the country, many of which have already had direct elections for governor and deputy governor. Unlike other regions, Jakarta sets tougher requirements for candidates to run for the governor's seat, i.e. the candidate must win at least 50 percent of the cast votes. This requirement, however, will not have any implications on the upcoming gubernatorial election as there are only two candidates running.

However, unlike other provinces, Jakarta democracy stops there. It does not go down to the municipal and regency level. Jakarta has four municipalities – North, South, East and West Jakarta – and one regency, the Thousand Islands. Even under the new law, these four mayors and one regent are still going to be appointed by the elected governor, with recommendations from the Jakarta DPRD. But the governor can ignore the recommendations.

Like other mayors and regents across the country, Jakarta's mayors and regent have a legislative council, but again, their members are selected by the Jakarta DPRD and endorsed by the governor.

When we go further down to the village level in this law, democracy seems to emerge again, although only partially. While the village heads are appointed by mayors and the regent, members of their legislative counterparts are all directly elected by the people.

Such complications in democratic practices in Jakarta, for many, can simply be tolerated because it is a special province. That's apparently one of the reasons this law exists. Most of all, people don't seem to be bothered whether their mayors and regent are elected or not. They might even not know who they are. The only leader they may know well is the governor.

We too can accept the timidity of the law in terms of promoting democracy. But we are concerned with the timidity of this law in promoting better public services and making this city a better place to live, work and play.

Unlike the autonomy laws, which decentralize power and functions to the municipality and regency level, thus bypassing the provinces, autonomy in Jakarta stops at the provincial level. The consequence is that all the money in Jakarta is going to be controlled by the governor – as is happening now – and the municipalities and the regency will not have financial independence. This practice will unfavorably affect public services as the provincial administration is just too remote from the people, especially the poor.

As if confirming the centralistic nature of this law, the law says that governors can appoint up to four deputies, on top of the elected deputy. It is not clear how the four deputies will work. It seems that such a mechanism will only create redundancies in the bureaucracy, as the Jakarta administration has many agencies, which are replicated at the municipality and regency level. The law simply has no interest in reforming the city bureaucracy.

The law, nevertheless, tries to solve the long prevailing problems of coordination with regions bordering Jakarta, especially in spatial planning, by demanding the establishment of the Inter-Regional Cooperation Agency. However, the law is again so timid in its nature that it does not give any power to this agency nor set a deadline for its establishment. The law leaves it to the administrations of Jakarta, West Java and Banten to decide on the nature of this agency.

This law focuses too much on the administration, but just ignores the people. It seems to forget the purpose of establishing a Jakarta administration, which is not only to support the governing of the unitary state of Indonesia, but most of all to serve its citizens better.

After all, it depends on the people who implement the law. It is for sure timid, but if the next governor dared enough to make a breakthrough in providing better public services, we may see a better outcome. So, let's forget the law for now and pick the best candidate for Jakarta.

Raising the flag is just an expression of anger

Jakarta Post - July 18, 2007

Iwan Gunawan, Jakarta – The administration of President Susilo Bambang Yudhoyono seemed to be irritated by independence aspirations reflected in the display of separatist flag in Ambon and Papua.

Such aspirations have been visible in Aceh, with former rebels proposing a local party which chooses their old flag as the party's symbol.

But Vice President Jusuf Kalla was quick to deny the administration had ever approved the request.

In response to the expression, a political party that claims to be nationalistic said those incidents would not have occurred had they still been in power.

So should the nation be concerned about the flag-displaying trend? From the administration's point of view, the issue should raise public concern regarding it's ability to solve serious national problems.

If the government fails to be decisive in its handling of the impacts of the Sidoarjo mudflow or in pursuing major corruption cases, why should we expect to see punishment for those raising a flag which was not a crime in the first place? Even if the administration is successful in building a legal case against those involved in the display of separatist group-linked symbols, critics would zero-in on the fact that we can steal state assets and walk free – but to show political aspiration in public is an offense.

From the perspective of the nation, this trend should force us to ask if there we have a healthy state of central-regional relations in this country.

Indonesia's people, its politicians and bureaucrats ignore the fact that provinces are not just administrative sub-units in a one-way top-down command system.

In fact, many of the regions in the country were sovereign territories before and during the colonial period. When independence was declared at the end of World War II in 1945, the regions did not think twice about committing themselves to the new Republic of Indonesia.

What is often underestimated is while the allegiance may be circumstantial given the window of opportunity for independence at that time, it was not without reciprocal expectations.

In other words, the regions agreed to be part of the Republic with an expectation they would be an inherent part of any important decision making of the country. For more than three decades under the New Order regime, however, regional participations in critical decision making were nearly absent.

Decisions were made by one man along with "elected" representatives (from the regions as well) pretending to deliberate – only to finally endorse any decision of the president.

Today's decisions are made through painful procedures of democracy, but genuine participation of the regions in critical decision making remains absent.

State budgets are negotiated between the executive and the legislative, both of which are controlled by centralistic political elites.

The Regional Representative Council (DPD) is the more genuine representatives of the people and was born in 2004 – but the centralist elites were unwilling to give it a role in critical decision making.

Local elites were awarded a political space to contest their own elections, but only if they were loyal to the central party board. And "loyalty" today is always associated with a "financial contribution" to the central board.

If all avenues for genuine regional and local aspirations are blocked by centralistic and elitist politics, the display of a separatist flag by the regionalists is actually a healthy way out.

No one has really been hurt, and they certainly did not take the financial pie the administration and the parties are fighting over. Political parties and party candidates raise their flags almost everyday, often using public money and without question occupying public spaces.

So why are the nationalists so worried about the "separatist" flags? Some observers say the incidents would not threaten national integrity.

They simply reflect the ability of those behind the move to win the hearts and minds of the population in regions that are tired of the dominance of the elites in Jakarta.

There seem to be several options the nations can consider in balancing the interests of the regionalists and the nationalists.

First, local elections for mayors, regents and governors could be made more open to local and regional candidates. The 7 percent threshold for parties to name candidates should be removed and independent candidates should instead be allowed to contest.

The risk of potential deadlocks in local parliamentary processes if this option is pursued is a myth. In reality, there is no genuine opposition or coalition in this country anyway. Pursuing this option would at least fully open the regional political space within the corridor of Indonesian democracy, even to the flag raisers.

Secondly, the DPD can be genuinely involved in critical decision making. It needs a full legislative mandate, even if in the end it has a smaller number of votes compared with the House of Representatives.

This option would allow the regions to transparently see how their aspirations are taken up in the national political decision making process.

The debates over whether Indonesia subscribes to unicameral, bicameral or tricameral parliamentary system is rather irrelevant at this stage. Indonesia is good at creating hybrid systems anyway.

Thirdly, regional symbols have been a part of this nation since its beginning – a flag is only part of it. Had Abdurrahman Wahid been in office, he would have encouraged other regions to have their own flags – not just Aceh, Maluku and Papua.

The presence of regional symbols will only better reflect the diversity of social identities of this great country. This option would at least make "illegal" flag-waving become legal and would allow our security and intelligence to focus their energies on criminals and terrorists.

Unfortunately, the harsh reality is any of these changes depend on the willingness of the 550 House members and the administration to push for genuine reform.

The reform movement put up a modern infrastructure of democracy with better elections and institutions. But if the nationalist politicians in the parties and the administration opt to keep on with horse trading and money politics, then perhaps raising regional flags is actually a healthy way of showing regional aspirations.

[The writer teaches regional development studies at the University of Indonesia and Bogor Institute of Agriculture.]

Past conflicts trouble Indonesia

Jakarta Post - July 17, 2007

Aboeprijadi Santoso, Jakarta – Few issues have shaken the nation as the conflicts in East Timor and Aceh. Both have been resolved, yet their impact on our nationhood lingers on.

The two issues, East Timor and Aceh, basically differ only in terms of political genesis and constitutional status; the one was invaded, occupied and acquired independence through a UN-held vote; the other, a betrayed, rebel province, with the Helsinki pact remains part of Indonesia.

Both have allowed both change and continuity for the course of the nation. On East Timor, the revolutionary spirit which shaped the political climate of Indonesia in the 1960s turned out to be relevant, as it was subsequently manipulated by the New Order.

While evoking the myth of Fretilin "communist" threats, the military actually capitalized on Sukarno's rhetoric to "get rid of the last vestiges of imperialism and colonialism" to justify the occupation. Soldiers were told of the need "to emancipate (East Timor) from the yoke of Western colonialism".

Popular perception of the far-flung archipelago as one state, whole and intact, was reinforced as Soeharto proclaimed the archipelagic concept (Wawasan Nusantara) to consolidate the new law of the sea in the 1980s.

As the media was suppressed, this idea led us for decades to consider East Timor a non-issue despite the tragedy that was occurring and the fact that Indonesia, contrary to its Constitution, became a colonial power.

It is this kind of besieged nationalism that has gained strength in particular because the military – thanks to the Aceh war – has restored its self-confidence. The Army, at its lowest point during the reformasi, was allowed and able to regain political ground as the Aceh crisis heightened.

If the experience with Timor is seen as a conflict with alien forces ("we" versus "they") allowing us to blame the outside world, the Aceh conflict was the opposite. It affected our national psyche as the Aceh war broke. The public supported the military's determination to crush the rebels. As a result, if East Timor questioned the concept and limit of our nation-state, the Aceh case put the idea of our nationhood itself in doubt.

Our nationalism, once defined by our founding fathers as one that should be nurtured in the garden of humanity, had turned aggressive, emphasizing centralism and particularistic rather than universalistic values. In the name of the unitary state, similar modes of retaliation and torture were used in Timor and Aceh, our war victims were kept out of sight (even activists do not ask about them) and true reconciliation out of question. Neither the state nor society likes to be reminded of them.

Although East Timor has parted ways as Aceh remains with us, both shook the nation because they affected our pride and state sovereignty in a way the nation never experienced before. Indonesia's unity and nationhood were at their height when the regional rebellions (late 1950s) were crushed, West Irian (Papua) regained and people mobilized in the name of an ongoing revolution (1960s).

Now, quite the opposite has been the case as the country "lost" one province (East Timor) and was seriously challenged by another (Aceh) while being burdened by crises – they all hurt our imagined might and greatness. "We" become hypersensitive and quickly saw things as infringing on our sovereignty.

The recent flag incidents in Maluku and Papua and the row over the former rebel flag in Aceh remind us that even in the post- conflict era we haven't been able to restore confidence in our nationhood. Neither are our leaders creative enough to build new instruments of collective imagining necessary to nurture the sense of belonging.

It's not just a matter of (lack of) "nation building". Tension grows between the center and periphery as old-style nationalism is at odds with the increasing demands for greater democracy. With self-government, local chief elections and local parties, Aceh, if successful, could provide a new model for Indonesia.

As we, as it turned out, badly needed external help to keep our nation-state intact, the security apparatuses need no longer be the sole guardian of the nation. Not the military, but diplomacy and good governance should be at the forefront of maintaining the nation-state by managing justice and welfare.

Finally, both the Timor and Aceh atrocities and impunity will remain blind spots for the nation. While Aceh and other conflicts areas provided paths to rehabilitation and promotion for alleged Timor war criminals, this war also tainted many ex-generals and, as the row over Sutiyoso's recent visit to Australia showed, will continue to do so. Like a curse, the legacy of human right matters, too, will continue to trouble the nation.

[The writer, a journalist with Radio Netherlands, is writing a book on East Timor and Aceh.]

Money and political interests turn our laws into dead letters

Jakarta Post - July 19, 2007

Hikmahanto Juwana, Jakarta – This newspaper has published various opinions from writers discussing legal conditions in Indonesia. The articles seem to identify the sources of weaknesses in law enforcement here.

Basically there are three categories of challenges facing law enforcement in Indonesia. First is the challenge in making substantive laws. Second is the weakness of law enforcement agencies. Third are the challenges related to the legal culture.

Making substantive laws is a challenge since lawmakers do not pay sufficient attention to ensure the laws they create can be implemented effectively. Lawmakers assume that the regulations they make will be automatically implementable and enforceable.

Laws are made at the national level without taking into account the gaps that exist in different regions in Indonesia, including legal infrastructure.

Laws are often made by reference to the conditions in Jakarta or in other big cities. Without adequate legal infrastructure, laws and regulations cannot be effectively enforced as intended. Many laws thus become dead letters.

Furthermore, laws and regulations are often made unrealistic. This is due to laws being made at the "order" of the political elite, foreign countries or international financial institutions, and even as a result of Indonesia's becoming a party to certain international treaties.

The making of such laws usually is not concerned with how they will be enforced. As long as their is a trade-off for making the law, law enforcement is hardly an important issue. This indicates that such laws are made with no real intention to enforce them. They are thus merely symbolic.

The second category of sources of weakness stems from the agencies enforcing the laws, including the individuals in these agencies.

Many have pointed out that law enforcement is weak because of the influence of money. In every line of law enforcement, the individuals are very much prone and open to the opportunity of corruption and bribery.

The other factor influencing the weakness of law enforcement is the fact that law enforcement has become a political commodity in Indonesia. During the Soeharto administration, the use of law enforcement as a political tool was prevalent.

Law enforcement could be arranged when those in power wanted it. The actions of law enforcers could be dictated, and even intervened in, by those in power.

Another problem causing weak law enforcement is selective enforcement. Corruption suspects and petty theft suspects are often not treated differently. And suspects with power and money often receive special treatment.

Law enforcers seem to take sides only with the rich and rarely if ever with the poor. The law tends to be on the side of those who hold positions and have connections with legal officials or access to the legal system.

All of the above is caused by the mentality of the law enforcement apparatus, which tends to look at suspects in terms of position or social status, rather than focusing on the alleged crimes. The higher the social status one has, the more reluctant the apparatus becomes to pursue matters.

The next source of weakness is that legal institutions are filled with mediocre-quality individuals. This is a result of the law being marginalized, with the brightest law graduates pursuing employment in the private sector.

Given the public sector's failure to attract individuals possessing knowledge and integrity, coupled with indications of bribery and corruption in the recruitment process, it is foreseeable that law enforcement will remain weak, perpetuating the role of money in law enforcement as part of a vicious circle.

Another issue with law enforcement agencies is the limited budget. Budgetary funds allocated by the government for legal infrastructure and the salaries of employees of public legal institutions are grossly inadequate.

Another concern, for some litigators it is unimportant to know the law. What is important is to have the right connections with individuals in enforcement agencies, such as judges, prosecutors or police.

The third category of sources of weakness in law enforcement is the legal culture in Indonesia.

Indonesians facing the legal process, especially those living in big cities, will do anything in order not to lose or to avoid punishment. This indicates that Indonesia is a victory, rather than a justice-seeking society.

It is not surprising, therefore, that in seeking victory, all possible means are explored, legitimate or otherwise, for the sake of gaining the end result.

The typology of a victory-seeking society is an issue for law enforcement agencies, especially when they lack integrity and are prone to bribery. A victory-seeking society is likely to see power and money as means to achieve victory or avoid punishment.

Bearing in mind the typology of Indonesian society, those who face the legal process will prefer advocates who have the right connections over advocates who understand the law.

Another source of weakness is the attention in the mass media. Whether we realize it or not, law enforcement in Indonesia has become a media circus since the press is driving law enforcement.

The attention afforded to law enforcement by the press is certainly very positive, as over the longer term it hopefully will lead to increased seriousness or professionalism in law enforcement.

What requires our attention, however, is the temporary nature of the attention. The fluctuating dynamism in law enforcement in a case appears to be dependent on the mass media.

If the media is willing to place a case in the headlines for a continuous period of time, legal institutions are likely to work more quickly and tend to be more responsive. However, when the same case disappears from the news, so does law enforcement.

At present, many in Indonesia are undertaking various measures for improvement. It is neither easy nor simple to resolve and correct the many weaknesses that have overshadowed law enforcement in Indonesia.

[The writer is Professor of Law, University of Indonesia. He can be reached at hikmahanto@yahoo.com.]

 Book/film reviews

Reminder of the perils that await migrant workers

Jakarta Post - July 22, 2007

[Dreamseekers: Indonesian Women as Domestic Workers in Asia by Dewi Anggraeni. Equinox, Jakarta (2006) pp. 250.]

Tony Smith, Contributor, Bathurst – In the 19th Century, Dutch colonists sent landless East Indies peasants to Suriname and New Caledonia to labor in plantations.

In the late 1970s labor exported from Indonesia was predominantly female as women sought employment as domestic workers in countries across Asia including Saudi Arabia, Taiwan and the three countries studied by Dewi Anggraeni: Hong Kong, Singapore and Malaysia.

Dewi's research was supported by the International Labor Organization of the United Nations, and while empathy with the workers informs the research report, Dewi understood the importance of consulting all of the stakeholders around this pressing issue. She calls her book "a labor of love"; few readers will disagree with this claim.

In examining the Indonesian women who have sought positions overseas, Dewi found a major motivating factor in the unavailability of work locally. It is not surprising, then, to find a poor attitude toward them among many overseas employers, who assume that the women lack skills, are poorly educated and are so desperate that they will work for little return.

Nor is it surprising that such perceptions lead to disappointment on both sides. However, in most cases the dangers to the women are far greater than the inconvenience to employers.

Many overseas domestic workers have suffered abuse of some kind. Unfortunately, the media cover only the extreme cases where, for example, workers have been duped into prostitution or severely assaulted.

Non-government organizations have taken up the cause and attempted to ensure that the workers are treated respectfully, and the situation has generally improved.

Too often, however, the Indonesian Embassy or a refuge such as Bethune House, has had to pick up the pieces after a woman's dream has been shattered.

Dewi discovered a "jigsaw" of information, personal stories "ringing with humanity" and vested interests trying to protect the status quo.

In a balanced approach, Dewi interviewed workers, employers, sponsors, employment agencies and representatives of governments and organizations such as the Women's Aid Organization.

Some of the interviews revealed heart-rending stories. "Sari", for example, was physically assaulted, verbally abused, strictly controlled and had her rightful salary withheld. Her employer cut her hair, claiming that she was unhygienic.

Others suffered sexual abuse. In many cases when the women complained to the recruitment agency confidentially, the employers were told and the abuses worsened.

Cycle of low esteem

Dewi notes that the women fared differently in each of their destination countries. Language was a greater difficulty and disadvantage in Hong Kong. In Malaysia, they had some cultural affinity with other Muslims and Malays, but they also suffered from an attitude that Indonesia was an impoverished land.

Wisely, she avoids the construction of a league table of mistreatment and gives credit where it is due for attempts to improve the women's situations. Standardization of contracts for example, has gone some way to formalizing and codifying the women's rights.

Dewi constructs some useful typologies of workers, employers and the agencies involved in the administration of overseas workers. She finds that the women vary in their motivations, skills and attitudes while employers differ in expectations, understanding and fairness.

The private sector recruitment and training agencies also vary widely, because they are poorly regulated, resourced and supported by government.

The Indonesian government has been "unjustifiably slow" in reacting to the problem, and unfortunately, it seems to be common knowledge that "irresponsible and unscrupulous elements" within government profit from the status quo.

An aid worker described "an inherent attitude" that women who seek work of this kind are "stupid, unskilled... untrainable". Yet, "when they are treated like normal adults they will behave accordingly". In all workplaces, managers and employers make decisions that facilitate the effectiveness of their workers. The problem is the difficulty of breaking into the cycle of low esteem.

Overseas readers will be interested to know whether this is a uniquely Indonesian problem. Dewi notes that despite social evolution since Independence and particularly growth of education, "collective, feudalistic mores" remain.

In the household, the order of importance runs from husband, to wife, then children and lastly domestic servants. Among the staff there is also a hierarchy from nanny to driver, gardener and cook through to maid and cleaner.

Maids are expected to be invisible and it is their role that forms the stereotype for overseas workers. There is sexism involved also.

As Solidaritas Perempuan (Women's Solidarity) argues, laws designed to protect other Indonesians employed overseas have not applied to domestic workers.

Dewi concludes with an examination of "the stakeholders as protagonists in hypothetical scenes of conflict". She uses a medical analogy, suggesting that the piecemeal approach to the problem has thus far treated isolated symptoms.

She recommends "an overhaul, remedial surgery". Dreamseekers provides a rational basis on which Indonesian decision-makers might base their decisions about the future welfare of these vulnerable women.

While Dewi avoids speculation and is thoroughly objective, Dreamseekers is a case study in a more general issue. It reminds us all of the problems that await workers of all kinds in the globalized economy.

While the rhetoric of globalization is of equality, equity and opportunity, the reality threatens to render us all outworkers in our own lands.

Dreamseekers is therefore a very timely document. The reviewer is a political scientist who has taught at several Australian universities, most recently the University of Sydney.

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