Democratic struggle

Squalls before the storm

Green Left Weekly - June 26, 2002

Max Lane, Jakarta -- Natalia Scholastika was a student activist in Bandung, West Java, when the first arrest warrant against her was issued in 2001. A member of the Peoples Democratic Party (PRD), she had helped organise a protest by thousands of workers in Bandung and there were clashes with the police. Several activists were arrested and put on trial. Natalia was not captured. A new police chief was appointed and the arrest warrant was forgotten. Scholastika kept organising. In November 2001, she was elected secretary-general of the PRD.

I met Scholastika in the PRD national office in Jakarta. It is a small house in the crowded residential area of Tebet. It serves as both the office for the Central Leadership Council, which coordinates the PRD's campaigning work, as well as being a place where activists can sleep at night.

"We have a political contradiction here", Scholastika said. "Especially on the campuses, everybody follows politics. There is no apathy. But at the same time, the student movement has declined and is in disarray." Scholastika explained that the big student cross-campus activist alliances of the 1998 anti-Suharto movement, such as the City Forum (Forkot) and its offshoot Jarkot, have declined dramatically. "They can mobilise maybe a hundred students now. Forkot has only one significant base, the Cawang Trisakti campus." Some groups that have been active in the past have been infiltrated by political brokers from the big parties or even the military. "One group even recently held an action in which they implied the student movement was opposed to putting the generals on trial for human rights abuses. Everybody is sure there was military money behind that", Scholastika said.

The latest issue to hit the headlines is whether Indonesia should end its relationship with the International Monetary Fund. Kwik Kian Gie, the minister in charge of the National Economic Planning Board and a member of President Megawati Sukarnoputri's Indonesian Democratic Party of Struggle (PDIP), opposes the IMF's instruction that Indonesia proceed quickly with the sale of several banks that the government took over after the 1997 financial crisis. They will surely fall into foreign hands.

Selling them early, Kwik argues, means selling them at very cheap prices and it also means that there would be no room for the government to reschedule the payment of the massive debts the government owes these banks. The size of these debts are nightmarish and could bankrupt the government in 2003 or 2004, according to Kwik. Megawati's other cabinet ministers have rebutted Kwik, stating that Indonesia cannot do without the IMF.

Debate An extensive and well-resourced network of non-government organisations and other institutions has now developed, which helps maintain an ongoing debate around issues of economic and political reform.

"The political atmosphere is very good for the movement", Scholastika told Green Left Weekly. "There are so many issues that are politicising society. Most of the issues being raised are hurting the political standing of the elite and the military. The military seems to think that its safest tactic now is to keep silent -- it is still on the defensive. The political elite is damaging itself. It is in an alliance in the government but each party is busy exposing the corrupt practices and unpopular policies of the other." The PRD secretary-general said that the priority issue for the majority of Indonesians remains high prices. "This year alone the price of most basic goods has risen 10-30%. There has been no real rise in incomes. The people are being more and more squeezed.

"We have no trouble in convincing people that the problem is the Megawati-[vice-president] Hamzah Haz government itself. Its popularity is very low. There have been spontaneous actions in which local people have taken down the flags of the PDIP in their neighbourhood. Just recently, there have been demonstrations by PDIP members protesting against Megawati's decision to support an ex-general deeply for the position of governor in Jakarta. The general was involved in the deadly attack on the PDI headquarters in 1996. Illusions in Megawati are disappearing." Alternative Scholastika explained that the problem that the movement faces is how to present an alternative to the Megawati government that the people will see as credible. "We call for a government of the poor, but who will this government be comprised of? That is what people are asking. How will it come to power?" She pointed out that the organised forces for a broader front that could challenge for power still had not yet emerged. "We had hoped that the May 1 Committee that organised the May 1 action could develop into such a broad front. But it has not developed beyond a trade union front taking up mainly labour issues. There is also the `Command Post for Lowering Prices' which has gathered some youth but it is still limited. We are trying also to reinvigorate the coalition of intellectuals that formed during the anti-Golkar campaigns of Abdurrahman Wahid's presidency. But a clear alliance of forces that could be seen as an alternative to the government of the political elite is just not there yet. That is our task now." "There is a debate taking place with other student and issue-oriented groups and NGOs", Scholastika added. "Is it time to raise the issue of replacing the Megawati government? Some groups, like Indonesian Muslim Students Action Committee (KAMMI), still view things in a moral framework -- of `cleaning up' the current government. Others have a phobia towards politics. Where they have developed a mass base of their own, they refuse to let it become involved in what they see as the `dirty game' of politics." It is a strange atmosphere in Indonesia at the moment. One cannot say it feels like the calm before the storm, because there are too many small squalls taking place. And it is not only the media discussion of politics, and the spontaneous anti- Megawati protests.

Every day, the newspapers report small and large local strikes and demonstrations or other grassroots actions. There are bombings in Jakarta and there is continuing unrest in Ambon and Aceh.

There are a large number of organisations that condemn the Indonesian political elite, a sentiment that is in line with the popular mood. Will they grasp the nettle, unite and put themselves forward as an alternative to the current government of the elite, as the PRD advocates?

Labour struggle

Maspion employees return to six-day work

Jakarta Post - June 29, 2002

Fabiola Desy Unidjaja, Jakarta -- Workers of the Sidoarjo-based plastic goods producer PT Maspion went back to work on Friday, ending a week-long stand off with the management of the factory over working days.

Thousands of workers entered the factory compound in Sidoarjo, East Java early in the morning and started their work as usual. Policemen no longer guarded the compound, and only company security guards watched over the site.

Assistant to Maspion president, Suharto, said the factory workers had no further complaint as the five-day working week regulation had been canceled. "The workers are satisfied because we have fulfilled their demand, but actually the six-day working week system burdens the company," Suharto told The Jakarta Post.

He said that the five-day working system was introduced to cut production costs. "But, we will just stick to normal working hours and no worker will be permitted to do any overtime to avoid unnecessary expenses," Suharto said.

Almost half of the 25,000 workers had been on strike in protest of the decision to cut working hours. The strike was marred by a clash on Wednesday that injured at least five workers and a journalist. Wisnu Dewabrata from Kompas daily, was beaten up by at least 10 policemen during the second day of the strike on Wednesday. The daily will take legal action against the police.

Also on Friday, criticism continued to mount against the perpetrators of the assault, with the Indonesian Television Journalists Association (IJTI) demanding legal action. "The public should know that such an assault is a violation of the rights of people for information," the statement signed by IJTI chairman Ray Widjaja said.

He underlined that the police had a long history of violence against journalists. "To end the list, there should be a transparent report on steps that have been taken against the policemen involved.

East Java Police spokesman Adj. Sr. Comr. Sad Harunantyo said on Friday that the police had arrested Second Brig. Hamzah who was among the police that seized Wisnu's camera during Wednesday's clash.

He further said that the East Java Police chief had asked the Sidoarjo Police to handle the case and to identify other policemen that joined Hamzah in the clash. "The [East Java] police chief has ordered that the names of the policemen involved in the clash should be submitted before July 1," Harunantyo said as quoted by Antara.

The East Java journalists association had asked the police to announce the names before July 1, which is the commemoration of National Police Day.

Workers, employers may take disputes to court

Jakarta Post - June 27, 2002

Jakarta -- The House of Representatives is expected to pass soon a long-awaited bill on the settlement of industrial disputes, which will allow workers and employers to take their disputes to labor courts.

The bill, which was drafted to update Law No. 22/1957 on industrial disputes and Law No. 14/1964 on labor dismissals, stipulates that workers and employers can take their disputes to the courts should they fail to resolve them through bipartite and tripartite negotiations.

According to the bill, district courts in all regencies and cities will have labor courts, consisting of career judges and ad hoc judges representing employers and workers.

"[A]ll decisions made by the labor courts will be binding," according to the bill, although workers and employers can appeal the verdicts to the Supreme Court.

The new bill phases out the local and central committees for the settlement of labor disputes, tripartite institutions set up under the current law to resolve disputes.

These tripartite institutions, representing workers, employers and the government, were found to be ineffective because their decisions were not binding and unable to be executed.

The draft law, which has already been deliberated by the House and the government, also suggests tripartite negotiations mediated by a government officer, conciliation by neutral third parties and arbitration to resolve disputes before they are taken to the courts.

The bill also regulates that only disputes concerning labor rights and interests, dismissals and unions are subject to negotiations and hearings at the courts.

Under the bill, workers are not allowed to go on strike while their disputes are in negotiation or being heard by the courts.

The bill threatens administrative sanctions or the revocation of licenses for government mediators, conciliators and arbitrators who violate any of the articles of the law. Those involved in disputes found guilty of violations are subject to one-month imprisonment or a maximum fine of Rp 50 million (US$5,500).

The bill has been applauded by both employers and labor unions, who say that besides speeding up dispute resolutions, the bill also will provide legal certainty.

Minister of Manpower and Transmigration Jacob Nuwa Wea said the bill would provide workers legal certainty about their rights and employers about their investment, especially with the start of the ASEAN Free Trade Area next year.

"This law will encourage all workers to be competitive and investors to comply with the labor law," said Nuwa Wea, who is also the chairman of the All-Indonesia Workers Union Federation.

Muchtar Pakpahan hailed the bill, saying it was based on a draft law proposed by a number of trade unions, including the Indonesian Prosperity Trade Union (SBSI), which he leads. "The SBSI and other major unions generally support the bill," he told The Jakarta Post by telephone from Jayapura, Papua.

Ariest Merdeka Sirait, the chairman of the Jakarta, Bogor and Bekasi Labor Union, said the bill had been needed for a long time because of the restrictions placed on labor unions nationwide.

Djimanto, the secretary-general of the Indonesian Employers Association (Apindo), said none of the employers under Apindo objected to the bill, adding that striking workers should not be paid. "We are all of the same opinion that no work equals no pay. Workers going on strike should not be paid because there is no products when workers are striking," he said.

The labor conditions in Indonesia have attracted international attention. The ongoing meeting of the International Labor Organization and the International Confederation of Free Trade Unions in Geneva has criticized the restrictions placed on labor unions in numerous regions in the country. The bill is scheduled to be passed into law on July 15.

Six workers, a reporter injured in a clash

Jakarta Post - June 26, 2002

Jakarta -- Five workers from PT Maspion Unit I in Gedangan area, Sidoarjo regency, East Java and a reporter who was covering the workers demonstration, were injured on Wednesday after a clash broke out between workers and the police, a report said.

Antara identified the five workers as Sukarmin (32), Arif (34), Nadzar (33), Ikhsan (29) and Nur Salim (32). All suffered from bruises.

The other victim was a reporter from Kompas daily, Wisnu Dewabrata, who was hit by the police while taking pictures during the demonstration. The police also seized his film.

The clash broke out when thousands of PT Maspion Unit I workers, who had launched a strike on Tuesday to protest the implementation of five days work, planned to continue their actions with a rally. The group were heading for PT Maspion Unit II in Buduran area with the aim of inviting their fellow workers to join the protest.

However, on their way to the factory, they were intercepted by dozens of police officers, who beat them up, injuring the six and forcing the remaining workers to disperse.

The laborers feared that the plan to implement the five-day week would affect their earnings. They said that their salary had been reduced when four months ago, the company reduced the permissible overtime from 4.5 hours a day to 1.5 hours.

Labor union restrictions too tight: Minister

Jakarta Post - June 26, 2002

Jakarta -- Minister of Manpower and Transmigration Jacob Nuwa Wea slammed employers and law enforcers for the rampant restriction of labor unions, saying workers had the right to strike as a last resort to put pressure on management to meet their demands.

The minister said that to date, he had received hundreds of complaints from labor unions about the arrest and trial of labor activists for coordinating labor strikes.

"I have sent a letter to the Supreme Court, the Ministry of Justice and Human Rights, the National Police and the Attorney General's Office to remain extra alert in handling labor cases," he said at a meeting at his office here on Tuesday with employers to publicize a bill on resolving labor disputes.

Jacob who has gained popularity among workers, labor unions and pedicab drivers, explained that many labor activists had been arrested and even jailed for leading labor strikes.

"Striking workers should not be arrested or charged with committing a crime because they have their right to do so, in accordance with the law.

"Therefore, the police, prosecutors and judges should be more careful when handling labor cases," he said, citing that many labor activists sentenced by district courts had appealed to higher courts to seek justice. This has tarnished Indonesia's image on the international stage, he added.

Indonesia codified ILO Convention No 87 on freedom of association into Law No. 21/2002 on labor unions, allowing workers to go strike to fight for their interests.

Jacob, also chairman of the All-Indonesia Workers Union Federation (FSPSI), cited the imprisonment, on May 27, 2002, of three labor activists employed by mining company PT Pakerin in the East Java town of Mojokerto as an example.

The three, Subyanto, Sumarsono and Betha Wiraningtyas, were each sentenced by the Mojokerto District Court to one year in prison for coordinating a labor strike to demand the management provide meal and transport allowances for the company's workers.

"The strange thing is that the prosecutor charged them under Chapter 161 of the Criminal Code on committing crimes and Chapter 335 on committing unsocial acts for their role in leading the strike," he said, citing the workers had gone on strike after the management refused to meet their demands.

The minister said he was suspected a conspiracy between the management, local police, the prosecutor and the court in penalizing the three activists to discourage the workers from striking.

Widespread labor union restrictions have attracted serious attention in the ongoing ILO conference in Geneva and the International Confederation of Free Trade Unions (ICFTU), representing more than 140 affiliated labor unions worldwide.

A report by ICFTU noted that a number of restrictions in the legislation allowing the court to dissolve a trade union if its basis conflicts with the 1945 Constitution or the Pancasila, the national ideology, or if its members or leaders have committed a crime against national security in its name and have been sentenced to at least five years in prison for that reason.

Union says labor relations remain tense

Jakarta Post - June 24, 2002

Jakarta -- Despite the lifting of the worst restrictions on labor union rights in 2000, many others still remain and labor relations have become increasingly tense, with many incidents of violent physical attacks on strikers, according to the International Confederation of Free Trade Unions (ICFTU).

ICFTU in its 2002 report Indonesia: Annual survey of violations of trade union rights released on June 19, 2002 through the Global Unions' website global-unions.org said that in one incident there was an attack on sleeping strikers, in which two people were killed.

It was referring to the death of two workers of footwear factory PT Kadera in East Jakarta who were killed when paramilitary groups launched an attack on the demonstrators who were protesting the company's closure in March 2001.

ICFTU represents 157 million workers in 225 affiliated organizations in 148 countries and territories. The All- Indonesian Workers Union Federation (FSPSI) and the Indonesian Prosperous Trade Union (SBSI) are ICFTU's affiliated members in Indonesia.

Since former president Soeharto's regime ended in May 1998, Indonesia has thrown out its draconian labor laws which prevented workers from forming trade unions and allowed the use of military force to settle industrial disputes. Workers are by law free to unionize and draw up their own rules.

Under the labor union law endorsed in 2000, unions must be registered with the Manpower and Transmigration Ministry and they are required to have a least 10 members, a reasonable limitation by international standards. In addition, there can be more than one union at a workplace and those who prevent a worker from joining a union are liable to a fine or imprisonment.

The law gives civil servants the right to organize, which they did not have beforehand.

The report also noted a number of other restrictions in the legislation allowing the court to dissolve a trade union if its basis conflicts with the 1945 Constitution, or the Pancasila, the national ideology which emphasizes consensus and national unity, or if its members or leaders have committed a crime against national security in its name and have been sentenced to at least five years in prison for that reason. "Once a union is dissolved, its leaders cannot form another for six years," the report quoted the law.

The law also allows the government to interfere in the labor unions' internal affairs since the unions are obliged to keep the government informed of nominations to and changes in their governing bodies, on pain of losing official recognition, and therefore the right to represent their workers.

During the recent May Day, thousands of workers from numerous labor unions went on strike to protest poor labor conditions in the country and demanded the government set June 6 as May Day instead of May 1, to commemorate the murder of labor activist Marsinah who was killed after organizing a strike in her workplace in the East Java town of Sidoarjo on May 6, 1995.

The report said the law does not guarantee workers the right to strike because they are not allowed to stage a strike while negotiating with their employers.

It said the regulation requires workers and their management to sign collective labor agreements (KKB) within 30 days and they must be submitted to the Ministry of Manpower for mediation, conciliation or arbitration.

"The law does not address the settlement of jurisdictional disputes between different trade unions at the same workplace," said the report.

Quoting SBSI Chairman Muchtar Pakpahan and other labor activists, IFCTU said relations between the government, big business and workers remains tense.

"When workers try to set up trade unions, companies often either dismiss or demote union leaders and members, making workers afraid of organizing or joining a union. Trade unionists also cite a growing number of attacks on their organizers by paramilitary groups supported by the military and police and paid for by employers to intimidate workers or break strikes," said the report.

Aceh/West Papua

West Papuan supporters confront Megawati

Green Left Weekly - June 26, 2002

London -- On June 16, protesters disrupted Indonesian President Megawati Sukarnoputri's meeting with British Labour Prime Minister Tony Blair. Waving placards, posters and a grave stone for the murdered Papuan leader Theys Eluay, protesters blocked the entrance to Downing Street to draw attention to the Indonesian military's human rights abuses in West Papua. Police dragged protesters out of the way, while others shouted "Get out of Papua" and "Papua Merdeka".

Civilian trial demanded for suspects in Theys murder

Jakarta Post - June 29, 2002

Tiarma Siboro, Jakarta -- The nine military suspects in the murder of pro-independence Papuan leader Theys Hiyo Eluay should be tried in civilian court, instead of a military tribunal, analyst Kusnanto Anggoro of the Centre for Strategic and International Studies (CSIS) and noted rights activist Todung Mulya Lubis said on Friday.

Bringing the nine servicemen to a civilian court would bode well for the principle of equality, they said. "Trying militarymen before the military tribunal will only pave the way for them to protect the institution from any wrong doing," Todung said.

The National Military Police recently revealed that nine suspects of Army's Special Forces (Kopassus) members would be tried in a military tribunal next month, instead of a human rights tribunal or a regular civilian court.

Three of the suspects include three middle ranking officers, Lt. Col. Hartomo, Maj. Doni Hutabarat and Capt. Rionaldo. The other six are non-commissioned officers. The suspects are charged with committing "an ordinary murder", and may face a maximum of 15 years in jail if convicted.

Todung also criticized the military's esprit de corps -- absolute devotion to the military -- which had affected the fairness and transparency of the legal process, as in many cases it had failed to punish its members.

"Any cases tried at the military tribunal will not be as open as other trials at a civilian court, because it is not in line with principles of the due process of law. Now the question is, should this sense of esprit de corps protect military operations which often victimize civilians?," Todung asked.

Papuan religious leaders and community leaders demanded earlier that the government bring the case to a human rights court as they believe that a political motive was behind Theys' murder.

Todung and Kusnanto, however, said that they were not out to challenge the presence of a military tribunal, but underlined that the tribunal was supposed to try members of the military who were accused of violating the military code of ethics, such as desertion or insubordination.

"The military handles all cases by classifying it as disobedience, even though they may actually be dealing with a human rights violation. This, of course, affects the verdict as it will be lighter than ones imposed in the general court," Kusnanto said.

Theys was found dead after he was reportedly abducted by unknown armed men on his way home from a function held at the local headquarters of Kopassus in November last year. Theys' driver, Aristoteles, remains missing and is presumed dead.

In a bid to unravel the murder, the National Military Police interviewed a total of 109 witnesses, 40 of whom are military officers.

TNI Chief claims security in Aceh has improved

Tempo - June 26, 2002

Zacharias Wuragil, Jakarta -- Indonesian Military (TNI) chief Gen. Endriartono Sutarto has claimed that the security situation in Aceh has improved. However, he still considers the Free Aceh Movement Force (AGAM) as the most important party that determines security in Aceh.

"It all depends on what the AGAM wants in this matter," Sutarto told reporters following celebrations for the International Day against Drug Abuse and Illicit Trafficking, held at the State Palace in Central Jakarta on Wednesday.

According to Sutarto, if the AGAM intends to continue talks with Indonesian government, the TNI will do the same. However, if the AGAM only intends to consolidate itself, the TNI will refuse to take part in talks with the AGAM.

Aceh refugees demand compensation

Jakarta Post - June 28, 2002

Apriadi Gunawan, Medan -- Some 1,000 Acehnese refugees staged a protest in front of the North Smatra provincial legislature on Thursday, asking the government to keep its promise to provide them with financial assistance.

Arriving in five trucks and dozens of buses, the refugees demanded the immediate distribution of financial compensation so that they could start new lives in other areas.

Coordinator of the protesters, Ngadirun, said the protest was prompted by a report that the central government had allocated some Rp 10 million (US$1,111) for each family, not Rp 2.75 million as previously mentioned by the local administration.

He said the money was intended to finance each family in establishing a new home after they had joined the local transmigration program.

"We are ready to move and live in other parts in the country, but the government should provide us with the money to start our new lives," Ngadirun said.

He underlined that none of the refugees wanted to go back to Aceh as the security situation in the restive province remained uncertain.

The government had also vowed to provide some Rp 900 billion to support the refugees while they were still living in refugee camps spread across the province.

However, the refugees claimed that none of the promises had been kept, and sometimes they did not even receive their allowances to buy food.

Currently, there are 1.3 million refugees staying in Langkat regency here.

Most of the refugees are not Acehnese, as they had come from other islands in Indonesia and left the province when the separatist Free Aceh Movement (GAM) grew stronger in Aceh.

In the meeting with the refugees, North Sumatra social affairs agency chief Sylvester Lase dismissed the report that the central government had allocated Rp 10 million for each family.

He said the government provided Rp 2.75 million for the refugees to start up new lives, and another Rp 5 million for each family to set a new home.

The official said the money would only be disbursed when the refugees were ready to join the local transmigration program, or to return to their hometowns.

He claimed that the program had yet to start, and that the first badge of the refugees would consist of 73 families to be sent to Riau province, 39 families to South Tapanuli regency in North Sumatra and six families to Medan Sunggal district in Medan. The second badge would be made up of 489 families to be sent to Riau.

Sylvester also said that should the refugees find any irregularities in the distribution of the compensation, they should report it to his office.

"If the officials take your money, just report it and we'll dismiss them," he said.

Aceh peace talks put at risk as violence rages on

Jakarta Post - June 28, 2002

Nani Farida, Banda Aceh -- Activists on Thursday cast doubts over the upcoming Aceh peace talks, as violence continued unabated with neither the separatist Free Aceh Movement (GAM) nor the government willing to back down from preconditions to move into a dialog.

Next month's all-inclusive dialog is expected to mark a breakthrough in ending nearly three decades of violence in Nanggroe Aceh Darussalam province by getting the two warring sides to speak.

But worsening security conditions had set back chances of a successful meeting, the activists said.

A lecturer at Aceh's State Syiah Kuala University, Takwaddin, said people feared that the dialog would fail just like others did before. "They've held eight dialogs before and all have come to nothing because of the violence," he said.

The Geneva-based Henry Dunant Center will mediate the dialog, which will serve as an alternative to the ongoing peace talks the Center sponsors. A source close to the dialog's preparation process said the worsening security conditions could block the dialog from taking place at all.

The source said that Henry Dunant officials canceled two preliminary meetings, the last one of which was slated for June 21. "They've never given any clear reasons for canceling the meetings." In another sign of uncertainty, Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono said GAM had yet to accept Indonesia's pre-conditions for the dialog.

The government insists further talks with GAM would only be possible under the framework of a unitary state of Indonesia and GAM agreeing to a proposed special autonomy package.

"Important for Indonesia is that GAM is serious about accepting the special autonomy and ceasing its armed resistance. The rest is negotiable, that's the point," Susilo said after attending a Cabinet meeting with the President.

GAM has been fighting for Aceh's complete independence since 1976. More than 10,000 people, mostly civilians, have since died because of the conflict.

Criticism against the government increased since its comprehensive program to end the conflict not only failed but worsened the situation in Aceh. Under the program launched in January, the military has built up its presence in the province and reactivated the Iskandar Muda Military Command. The death toll for 2002 so far is more than 400.

On Tuesday, Army Chief of Staff Gen. Ryamizard Ryacudu asked House of Representatives legislators to support the ongoing military operation in Aceh despite an upsurge of casualties.

Analysts have said the military was part of the problem instead of the solution and were blocking efforts to break the circle of violence. However they said there was little incentive for Jakarta to push ahead with negotiations amid signs that GAM's forces were weakening.

Outside of Indonesia, few countries support an independent Aceh state as GAM demands. Most have urged GAM to accept the government's special autonomy status.

Earlier reports have shown GAM negotiators leaning toward acceptance of the offer but as yet nothing concrete has been done.

To save the dialog from collapsing, Chairman of the Aceh Referendum Center of Information (SIRA), Mohammad Nazar called for a cease fire ahead of the all-inclusive dialog. "It will help if the government and GAM first discuss the dialog mechanism first, including the safety guarantee for the participants," he said. Nazar reminded the government not to arrest any GAM negotiator who rejects the special autonomy offer.

Aceh to recruit religious police

Jakarta Post - June 27, 2002

Jakarta -- In a further move to implement syariah, or Islamic law, in Aceh, Nanggroe Aceh Darussalam Police will soon recruit officers for its special religious police unit, YAntara news agency reported.

"We have already set up a team to discuss the recruitment. We have prepared the required processes and now we are waiting for approval from the legislative council," Aceh Police chief Insp. Gen. Yusuf Mangga told the news agency. He added that the number of new recruits would be specified later in a city regulation.

The central government granted special autonomy to the province last year in an attempt to appease demands for independence. As part of this special autonomy, Aceh has been allowed to implement syariah.

Nine sportsmen abducted in Aceh

Jakarta Post - June 27, 2002

Jakarta -- After participating in the Aceh provincial sports week in Sigli, nine athletes and officials from the Aceh Singkil regency were reportedly abducted by a group of unidentified armed men in Peureulak, East Aceh regency, Antara reported on Thursday.

The military operation command spokesman in Lhokseumawe, Maj. Zaenal Mutaqin, confirmed the incident. "I have received a report that the nine athletes and officials from Aceh Singkil were abducted by armed civilians on Wednesday afternoon, as they were returning home after taking part in the sports event in Sigli," Mutaqin said.

"We became aware of the abductions when the driver of the car carrying the abducted people reported the incident to a security post," he said.

According to the driver, identified as Sofyan Thaib, the car he was driving was intercepted by about 20 armed men in the area of Peureulak. Sofyan was ordered out of the car and then his mouth was taped shut. The armed men then drove away in the car, with the nine athletes and officials.

The fate of the nine men remains unknown, but security personnel are tracking their whereabouts. Zaenal hinted that the armed civilians were possibly rebels from the Free Aceh Movement.

Defense in Theys' murder trial says no witnesses saw slaying

Jakarta Post - June 26, 2002

Novan Iman Santosa and Yogita Tahilramani, Jakarta -- Not a single eyewitness against nine suspects for the murder of Papuan pro-independence leader Dortheys "Theys" Hiyo Eluay witnessed the murder, defense lawyer Warsito Sanyoto said on Tuesday.

Despite the lawyer's claim, the National Military Police asserted that its team had built a strong case against the nine suspects, all members of the Army Special Forces (Kopassus).

A total of 109 witnesses had been interviewed by the National Military Police. Of those 109, 40 are military officers. "Of all the witnesses, not a single eyewitness claims to have witnessed the murder," Warsito told The Jakarta Post.

He added that there were witnesses who claimed to have witnessed the kidnapping of Theys, but they could not positively identify the kidnapper or kidnappers. "One witness saw an unidentified man pushing the driver of Theys, towards the car. But, who this man was, the witness cannot say for sure," Warsito said. Theys' driver, Aristoteles, remains missing and is presumed dead.

Dossiers of the nine suspects were prepared by local police, who were the first to initially handle and investigate this case, before investigations were ultimately taken over by the National Military Police.

A military probe concluded that the murder of Theys, a former Golkar Party member, was not politically motivated.

The nine suspected Kopassus officers involved in the death will be tried through a regular military tribunal next month, since the case was not classified as a human rights violation, but a criminal act." The nine suspects face a maximum of 15 years in jail.

Three of the suspects are middle ranking officers: Lt. Col. Hartomo, Maj. Doni Hutabarat and Capt. Rionaldo. The other six are non-commissioned officers.

National Military Police chief, Maj. Gen. Sulaiman A.B., seemed confident on Monday that his team had built a strong case against the nine Kopassus officers, saying that they had damning testimony from several witnesses.

There was an eyewitness, Warsito said, who knew one of the suspects, Capt. Rionaldo, personally, and met him on a daily basis, but this eyewitness too, could not identify whether the kidnapper was Rionaldo or not.

"All us lawyers were present when the photographs were being shown to witnesses and, witnesses and suspects were confronted with one another," Warsito said.

"If it was Rionaldo, this witness would have said, it's Rionaldo, since they meet each other on a daily basis and this person knows Rionaldo's face very well. The fact is, the witness said that it was not Rionaldo." When asked of the possibility that the eyewitness was afraid that his life would be in danger if he admitted that Rionaldo could be one of the alleged kidnappers, Warsito did not comment on this.

He simply said that the team of lawyers were confident that they could break the case of the military prosecution since it was not only "weak, but it did not have the support of eyewitness testimony." "I am quite confident our team will win the case," Warsito said.

Eluay killing not political, says military

Sydney Morning Herald - June 25 2002

Indonesia's military has ruled that the killing of seperatist leader Theys Eluay in the restive Indonesian province of Papua was not politically motivated.

The suspects -- all members of the army's Kopassus elite special force based in the Papuan capital Jayapura -- will face a military tribunal, Military Police chief Major General Sulaiman was quoted as saying by The Jakarta Post.

Eluay was kidnapped and strangled in November by a group of unidentified men after he returned from a dinner at the local Kopassus headquarters.

Sulaiman refused to disclose a possible motive for the murder, which has intensified the distrust felt by ordinary Papuans toward the military and the central government and has led to calls for an international investigation.

Sulaiman said the suspects, among them three middle-ranking officers, had denied any role in the slaying.

The army has admitted that some of its officers may have been involved in Eluay's murder, but said the men were acting outside the chain of command.

Eluay advocated peaceful dialogue with Jakarta rather than violence in Papua's independence struggle.

Indonesian President Megawati Sukarnoputri supported the establishment of the inquiry, but has declared her unequivocal opposition to West Papuan independence.

Indonesia formally annexed West Papua, a former Dutch colony, in 1969 after a UN-sanctioned 'act of free choice' in which about 1,000 hand-picked tribal leaders allegedly expressed their desire for integration. Critics have dismissed the process as a sham.

Forget peace talks, just crush rebels: Jakarta

Straits Times - June 26, 2002

Derwin Pereira, Jakarta -- The Indonesian Armed Forces (TNI) has received crucial backing from legislators to use force against separatists in Aceh as a military offensive grew imminent in the troubled province.

But doubts emerged whether the TNI's hardline option would be effective given the deeply entrenched nature of the insurgency in the area that is complicated by guerilla warfare and the military's acute shortage of weapons.

The military generals, having had their plans stalled by previous civilian administrations, appeared to be riding on a wave of unprecedented political support for their security policy since ex-president Suharto's fall in 1998.

Mr Amris Fuad Hassan, who attended a parliamentary commission hearing on Monday where the newly installed army chief, General Endriartono Sutarto, made a pitch for the use of force not just in Aceh but other trouble spots such as Irian Jaya, said "peaceful dialogue is no longer an option".

"The unity of Indonesia should never be taken for granted," he told The Straits Times. "We cannot tolerate any form of separatist movement in this country. Very soon, it will be Kalimantan, Riau and others wanting to jump onto the bandwagon for independence. The armed forces should not hesitate anymore because they have our backing."

His comments follow a plea by Gen Endriartono that the TNI could not do anything to crush the separatists if it did not have the backing of legislators.

Observers said the military might have secured "vital insurance" by securing parliamentary support for a blitzkrieg against the Free Aceh Movement (GAM). And with a political umbrella now, it could crush the rebels without any fear of being accused of human rights abuses.

The TNI has been tightening the screws on the rebels for the past six months. For a start, it carved out another strategic zone for itself in the country by deploying troops there and appointing a one-star general to head the command. It scored another victory by earlier killing GAM commander Tengku Abdullah Syafi'ie. But this has hardened the separatists' resolve to slug it out with Jakarta.

Security analyst Ken Conboy of the Control Risks Group noted: "GAM, in fact, has persevered on and off for nearly three decades with almost no formal military hierarchy. And with ... a newer generation of secessionists operating from Malaysia still intact, there is little likelihood of GAM throwing in the towel any decade soon."

The difficulty for the TNI is to fight an outfit that resorts to guerilla tactics rather than conventional warfare -- something that could sap the morale of already demoralised soldiers.

Despite deploying an elite reconnaissance unit and more troops on the ground, there is little evidence so far that the TNI could weather the storm effectively. This is made even harder by the fact that the military is grappling with a shortage of anti- guerilla weapons.

Gen Endriartono made it clear during his meeting with legislators that this was a pressing problem as he made a pitch for more funds.

The TNI seems to have won over the legislators despite gaping holes in its policy towards Aceh. Mr Amris said: "There is no other option available to us. Force is the only way to keep Aceh in Indonesia."

Aceh activists call for end to security operation

Jakarta Post - June 25, 2002

Nani Farida, Banda Aceh -- Acehnese human rights activists questioned on Monday the effectiveness of Presidential Instruction No. 1/2002 on the Comprehensive Solution to Aceh's Problems to settle the conflict in the province as its six-month deadline nears, while violence remains unabated.

The instruction, issued in January and aimed at coordinating social, economic and security issues to end the separatist movement in the province, has provided justification for the Indonesian Military (TNI) to do whatever it takes to maintain law and order.

"As long as the government keeps the decree alive, violence will continue in the province," Tarmizi, of the Aceh Legal Aid Foundation, said on Monday, while adding there had been hundreds of cases of violence registered by the foundation since January.

He charged that the TNI had used the article on law enforcement to prioritize the use of force instead of dialog in ending the conflict in Aceh.

"Law enforcement should have brought many cases of violence to court, not by conducting raids that sometimes missed their target and victimized common people," Tarmizi added.

He pointed out that the security apparatus had carried out many unlawful arrests against members of the separatist Free Aceh Movement (GAM), without giving any clear reasons.

"It's like a repetition of former military operations," he said, while referring to the imposition of the Military Operation Zone (DOM) in the past.

The instruction was first issued by then president Abdurrahman Wahid in April 2000, after a humanitarian pause agreed by both the government and GAM failed to end clashes in the province.

The instruction focused on economic rehabilitation, law enforcement and all-inclusive talks to end the prolonged conflict.

President Megawati Soekarnoputri maintained the policy and issued an extension to the instruction in January, but as its deadline nears, the all-inclusive talks have yet to be realized and the TNI continues to wage war against the separatist movement.

Tarmizi underlined that it was impossible for the government to conduct talks, but at the same time stepped up pressure against GAM, which is supposed to be the government's dialog partner.

Another activist Abdulrahman Yacob underlined that the continuation of the instruction would backfire, as people would lose their trust in the government.

"The people of Aceh are tired of the violence and it has to end," he remarked.

He cited the traumatic 10-year military operation in Aceh, which ended in 1999. The ongoing law enforcement operation has brought back many bad dreams and memories for a large number of people.

Tarmizi expressed pessimism that the central government would pay attention to the Acehnese concern over the law enforcement operation.

"When the government finally set a date for the talks, they will talk about security and underline the importance of law enforcement to continue the implementation of the instruction," he said.

House backs moves to use force against separatist movements

Jakarta Post - June 25, 2002

Tiarma Siboro, Jakarta -- Members of the House of Representatives (DPR) unanimously threw their support behind the Indonesian military on Monday in allowing it to flex its muscles against secessionist movements in the country, particularly the Free Aceh Movement (GAM).

"We fully support moves by the TNI to take resolute action against separatist movements in Indonesia, especially GAM," House Commission I chairman Ibrahim Ambong said at the conclusion of a hearing with Indonesian Military (TNI) chief Gen. Endriartono Sutarto here on Monday.

Commission I, which is in charge of political, security and foreign affairs, also endorsed a proposal by the TNI to increase the budget allocation for defense and efforts to improve the welfare of military personnel.

During the hearing, Endriartono repeatedly stressed that efforts to destroy the unitary state of Indonesia must be firmly quelled, with military force if necessary.

According to the four-star general, separatist groups such as GAM should be seen as an enemy not only by the military, but also by civilians including legislators, so that the "TNI can carry out its duties without any fear of allegations of human rights violations".

"As long as civilian [politicians], I mean all of you honorable legislators, do not support us in dealing with these rebellions, we [the TNI] can never do anything to crush them," he said. "All we need is a political decision ordering us to mount it [the military operation]," Endriartono said.

During the hearing, Endriartono was accompanied by, among others, Navy Chief of Staff Adm. Bernard Kent Sondakh, Air Force Deputy Chief of Staff Vice Air Marshall Alimunsiri Rape, Army Chief of Staff Gen. Ryamizard Ryacudu, TNI General Affairs chief Lt. Gen. Djamari Chaniago, and Strategic Intelligence Strategic Agency (Bais) chief Vice Air Marshall Ian Santoso PK.

"We support the ongoing peace talks between the government and a number of Acehnese representatives, but this process has also been used by GAM to consolidate," Endriartono said referring to a series of peace talks sponsored by the Switzerland-based non- governmental organization The Henry Dunant Centre.

Since Endriartono was installed as TNI chief replacing Adm. Widodo AS, he has consistently urged the crushing of any struggles against the legitimate government by military means, arguing that the government had been patient enough in dealing with rebellions.

During the 32 years of the New Order regime, former president Soeharto conducted several such military operations in attempting to crush separatist movements in provinces including Irian Jaya, Nanggroe Aceh Darussalam and East Timor.

At the time, thousands of civilians reportedly fell victim to the operations with rape, torture, intimidation and murder by the military reportedly commonplace.

The military approach had been condemned for its failure to answer separatist demands in the country, particularly after Indonesia's former 27th province, East Timor, got its independence through a United Nations-sponsored vote of self- determination.

The TNI has also been blamed for committing gross human rights violations during its military operations. Some of its officers are currently on trial before the Human Rights Tribunal.

Military fails to stop violence in Aceh

Jakarta Post - June 24, 2002

Nani Farida, Banda Aceh -- The reestablishment of the Iskandar Muda military command in Nanggroe Aceh Darussalam province has failed to bring about peace in the restive region.

Aceh human rights campaigner Maimul Fidar said the existence of the military command had instead limited the space for civilian activities in the province.

"There is no free space for civilians in Aceh like there was [before the military command was revived]," Fidar said on Saturday, while pointing to a seminar that was recently banned by the authorities in Aceh.

Fidar, coordinator of the Human Rights Aid Institute in Aceh, added that there had been no sign of decreasing violence since the reinstatement of the military command. He emphasized that the military command was not helping to resolve the problems in Aceh.

Spokesman for the separatist Free Aceh Movement (GAM) in Pidie, Teungku Laweung, concurred with Fidar, saying that the reestablishment of the military command had only brought more repression to the province.

He recalled the conflagration in Idi Rayeuk subdistrict and the alleged torturing of 22 civilians in West Aceh by the military and police on June 5 and June 6.

"The military command will not confine us, but rather will give us more space. We regret the increasing number of civilian fatalities in every incident," he said, responding to a question about whether GAM's room for maneuver had been curbed since the reestablishment of the military command.

The Iskandar Muda military command was reinstated on Feb. 5 amid opposition from human rights activists. It was originally formed in 1956, but was disbanded in 1985 for efficiency reasons. Since then, security operations have been coordinated by the Bukit Barisan military command, based in Medan, North Sumatra.

At least 1,700 were killed last year in Aceh, with more than 200 having been killed since the beginning of this year alone.

Iskandar Muda military command spokesman Lt. Col. Firdaus Komarno, however, refuted all the accusations, saying that people should differentiate between civilians and the military. "The military and civilians are two different things. How can they be mixed up?" Komarno asked laughing.

Commenting on the accusations that the military often committed human right abuses, Komarno said his men could not arrest and punish people on a whim.

"We have procedures. If someone is proven guilty, we will take action," he said, adding that the existence of the military command had helped improve the psychological state of the Acehnese.

According to Komarno, the Acehnese now dared to once again go about their everyday activities. "That's a success," he said on Saturday.

Despite the arguments of the military, violence has been on the rise over the past few weeks in Aceh.

The latest incident was on Saturday morning when a police officer, identified as Samsul, 50, was shot dead by an unidentified person at his home on Jl. Taman Siswa in the provincial capital of Banda Aceh. He was rushed to the hospital, but to no avail. His daughter said that she knew the identity of the assailant.

Previously, six members of the Air Force's special forces (Paskhas) were killed in an ambush near Iskandar Muda airport in Blangbintang, Aceh Besar regency, on Wednesday night.

Five PTPN workers killed in Aceh

Jakarta Post - June 24, 2002

Jakarta -- Ten armed men shot dead five employees of a state- owned plantation in Aceh and kidnapped eight others on Saturday, the military said on Sunday.

All of the victims were employees of state-owned plantation PT Perkebunan Nusantara I in Langsa district, East Aceh.

The five were killed while working on an oil palm plantation in Blang Tualang village, Bireum Bayeum district, some 450 kilometers east of Banda Aceh, the spokesman for the military's Operations Command in Aceh, Maj. Zaenal Muttaqin, told Antara news agency.

He identified the five as Sofyan Hadi, Hariyono, Lahat, Syahrul and Mulyadi. The bodies of the five victims have been returned to their families for burial. Missing were Tasman, Buyung, M. Soleh Abdullah, Salahuddin, Muhiddin, Sri Gunawan, Armana and Hendrik Saputra.

Zaenal said armed rebels from the Free Aceh Movement (GAM) were behind the killings and the abductions. "After cold-bloodedly killing the five, the rebels abducted nine others, but one of the men, identified only as AZH, managed to escape and took refuge at a security post," Zaenal said.

The attackers, armed with rifles and handguns, also burned a platform truck used to carry the oil palm kernels.

The military, Zaenal added, was attempting to locate the rebels and free the eight men who were abducted. "If GAM runs out of resources and has no public support it should not terrorize local residents," he stated.

Also on Saturday, a joint police and military team of some 180 men raided a suspected GAM base in Peureulak, East Aceh regency, and shot dead three rebels. Zaenal said some seven other rebels managed to escape.

Meanwhile, residents in Dama Hitam, West Aceh district, were quoted by AFP as saying that they had found on Saturday the bodies of two men who had died of gunshot wounds.

They said the victims were civilians who had been shot by security forces who conducted an antirebel operation in the area on Friday. Muttaqin said he had not received a report on the incident.

GAM has been fighting for an independent Aceh on the island of Sumatra since 1976. More than 10,000 people, mostly civilians, have died in the conflict, including over 200 this year.

Government & politics

Islamic alliance 'could lead to anti-Megawati plot'

Jakarta Post - June 29, 2002

Muhammad Nafik, Jakarta -- A recent series of gatherings involving Muslim politicians could lead to the establishment of an Islamic alliance against President Megawati Soekarnoputri should she insist upon deterring the amendment process for the 1945 Constitution, analysts said.

"If Megawati makes a blunder by continuing to refuse the constitutional amendments, the grouping could be turned into an anti-Megawati alliance immediately," Arbi Sanit, an academic from University of Indonesia, said on Friday.

He warned that Muslim politicians along with their nationalist colleagues from the Golkar Party might even plot to oust Megawati from power if she failed to consistently support the much- demanded changes to the Constitution ahead of the 2004 elections.

Senior Muslim figures from major political parties and numerous Muslim organizations have held four separate meetings since last month to set up a new Islamic alliance aimed at countering the nationalist-oriented Indonesian Democratic Party of Struggle (PDI Perjuangan), which Megawati currently chairs.

The latest of which took place on Thursday evening, when they gathered at the residence of deputy speaker of the People's Consultative Assembly (MPR) Cholil Bisri in Slipi.

Meeting attendees included former president Abdurrahman "Gus Dur" Wahid, chairman of the National Awakening Party (PKB) Alwi Shihab, Justice Party (PK) President Hidayat Nurwahid, legislator from the National Mandate Party (PAN) Fuad Bawazier and a number of Golkar leaders such as Fahmi Idris and Theo Sambuaga.

A well-placed source told The Jakarta Post Thursday evening that the meeting had originally planned to discuss whether or not to keep Megawati until her current tenure ends in 2004, but dropped that part of the agenda after PAN Chairman Amien Rais, who is also MPR speaker, did not show up for unknown reasons.

PAN is one of the Muslim-based political parties that formed the Central Axis Group which successfully blocked Megawati's bid in the 1999 presidential election.

PDI Perjuangan legislators and leaders were conspicuously absent from the meetings.

Megawati's husband Taufik Kiemas is reportedly trying to approach Muslim politicians to challenge the new alliance. He set up a private meeting with Gus Dur on June 4. However, Arbi claimed Taufik's maneuvers would be futile as it was very difficult for Gus Dur to trust Taufik and Megawati.

Megawati also held a meeting at her residence on Thursday evening with Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono, Indonesian Military (TNI) Chief Gen. Endriartono Sutarto and the chiefs of staff of the Army, Navy and Air Force.

No information was available about the meeting, but a source close to the President said that the meeting was prompted by the Muslim politicians' gathering at Cholil's house.

According to Arbi, Muslim politicians plus Golkar legislators from Islamic groupings could declare Megawati and her party a "big enemy or threat" to the nation's reform process if she rejected a direct presidential election.

Speaking to journalists during last week's European visit, Megawati questioned whether the people were already prepared to hold a presidential election.

Syamsuddin Haris from the Indonesian Institute of Sciences (LIPI) said on Friday the recent meetings of Muslim politicians were aimed at consolidating their vision and mission in preparation for the 2004 elections. "Their focus is not Megawati. Their political agenda and target are not clear yet," he said.

However, Syamsuddin said that with the meetings the group wanted to show its "strength" to put pressure on Megawati and PDI Perjuangan to implement the reform agenda.

Another political observer Fachry Ali said Muslim politicians were making a "trial-and-error" movement through the series of meetings to explore a possible alliance ahead of the next elections. "What the political maneuvers actually will be, is still unpredictable," he said on Friday.

Fachry said the political meetings would give a full recognition of Gus Dur's camp of the National Awakening Party (PKB) that has been split into two factions. The other camp is led by current Minister of Defense Matori Abdul Djalil.

"It also benefits Gus Dur himself as he once again gets some of the limelight after his downfall last year," he added.

Political leaders meet at Cholil's residence

Jakarta Post - June 28, 2002

Jakarta -- A number of political leaders belonging to a loose grouping of Islamic parties, plus some Golkar Party legislators, met at the residence of deputy speaker of the People's Consultative Assembly (MPR) Cholil Bisri on Jl. Kemanggisan Ilir 2B, Slipi, on Thursday evening, with the host denying that the gathering had any political agenda.

Those attending the meeting included former president Abdurrahman Wahid, National Awakening Party (PKB) chairman Alwi Shihab, Justice Party (PK) president Hidayat Nurwahid, Golkar chairman Fahmi Idris, and National Mandate Party (PAN) legislator Fuad Bawazier.

Also joining the gathering were Golkar legislators Rambe Kamarulzaman, Andi Matalata and Theo Sambuaga, and PKB legislators Muhaimin Iskandar, Ali Masykur Musa, Yusuf Muhammad, and Rodjil Gufron.

PAN chairman Amien Rais, who is also MPR speaker, failed to show up. Legislators and leaders of President Megawati Soekarnoputri's Indonesian Democratic Party of Struggle (PDI Perjuangan) were conspicuously absent from the meeting.

According to the host Cholil, the function was merely a thanksgiving celebration that had no political significance. But a highly placed source who participated in the gathering told The Jakarta Post Thursday evening that the meeting was originally intended to discuss whether or not Megawati should be maintained in office until 2004, the end of her tenure. The source said they decided not to pursue the topic after Amien Rais failed to show up without giving any explanation.

PAN was one of the Muslim-based political parties that blocked Megawati's bid in the 1999 presidential bid. However it also played a pivotal role in removing former president Abdurrahman Wahid from office in July 2001, catapulting Megawati into the presidential seat.

Almost at the same time, President Megawati was holding a meeting at her residence on Jl. Teuku Umar with Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono, Indonesian Military chief Gen. Endriartono, and the chiefs of staff of the Army, Navy and Air Force.

No information was forthcoming about the topics discussed at the meeting, which started at around 7pm. A source close to the President told the Post that the meeting was called with very little notice.

At the meeting of Muslim party leaders, Fuad Bawazier said the participants had all agreed that Indonesia should hold a direct presidential election in 2004.

"Whatever happens, we will have a direct presidential election in 2004, and any political party that opposes the move will be sidelined, including the PDI Perjuangan," Fuad said.

The PDI Perjuangan has shown great reluctance in supporting a direct presidential election in 2004.

Megawati kills democracy: Experts

Jakarta Post - June 28, 2002

Ahmad Junaidi, Jakarta -- Political experts criticized chairwoman of the Indonesian Democratic Party of Struggle (PDI Perjuangan) Megawati Soekarnoputri dubbing her a "democracy killer" for defying her party's aspirations by supporting the reelection of Jakarta Governor Sutiyoso.

"She has not only reduced [the meaning of democracy], she has even killed democracy," political observer J. Kristiadi of the Centre for Strategic and International Studies (CSIS) said at a discussion at the City Council on Thursday.

PDI Perjuangan's central board announced on Tuesday that the party favored Sutiyoso as the governor was considered capable of providing security during the 2004 General Election and the General Assembly of the People's Consultative Assembly in 2005.

Two weeks before the announcement, Megawati had instructed the party's city councillors to nominate Sutiyoso, rejecting the party's own candidates.

Kristiadi viewed Megawati's endorsement as undemocratic since it defied the aspirations of her party's city branches, which earlier nominated 11 gubernatorial candidates, not including Sutiyoso, in its earlier meeting here.

He said Megawati had repeated the same mistakes committed by the past regime of former authoritarian Soeharto by endorsing Sutiyoso, who is a former Jakarta military commander.

"Her acting against the grass roots aspirations will weaken support for her party since their supporters will no longer trust the party," Kristiadi said.

He said the Jakarta election should be more democratic than other provinces and urged the party's councillors and other councillors to reject Megawati's nomination.

Separately, political expert Ikrar Nusa Bhakti said Megawati should remember that Sutiyoso was implicated in the bloody attack at her party's headquarters on July 27, 1996.

"Megawati and her party seem to have forgotten the case for the reasons of political expediency. It could become a boomerang for her party," Ikrar of the National Institute of Sciences (LIPI) was quoted by Detikcom online news as saying.

In his opinion Megawati was practicing the ways of the New Order regime of Soeharto in nominating a military figure for Jakarta governor citing security reasons.

Megawati's support for Sutiyoso is controversial as the party's city chapters earlier proposed 11 other candidates in its earlier meeting here.

Her actions have been deplored by party members and she has been called a traitor by victims of the July 27 tragedy for nominating Sutiyoso. At least five supporters were killed after the attack, which was followed by massive riots in the areas around the party headquarters on Jl. Diponegoro, Central Jakarta in 1996.

The party's Jakarta chapter chairman Tarmidi Suhardjo, who was nominated by the party's branches, pledged to continue his candidacy although Megawati has nominated Sutiyoso.

"I'm ready to be "slapped" by Megawati and even kicked out of the party," Tarmidi, who is also the City Council's deputy chairman, said earlier.

But the former deputy chairman of the party's central board, Suparlan, who is also a member of the House of Representatives, supported Megawati's decision.

"We [our cadres] have no capability to become a governor or, even, a City Council chairman. We should be realistic," Suparlan said.

Separately, the Association of Indonesian Provincial Legislative Bodies plan to issue a statement rejecting Megawati's intervention in the election, the association chairman Edy Waluyo said on Thursday.

"The Jakarta delegation will propose an agenda to discuss the central government's intervention in the gubernatorial election," Edy, who is also chairman of the City Council, told reporters.

Accompanied by West Sumatra Legislative Council chairman Arwan Kasri, Edy, who earlier registered himself as a candidate, revealed the association would hold a two-day national meeting in Pangkal Pinang, Bangka-Belitung province, starting on Friday.

Arwan Kasri, who is also the association's coordinator for Sumatra, supported Edy's statement, saying the gubernatorial election was under the authority of the City Council.

"We councillors in West Sumatra reject the intervention. It's the right of the provincial legislative body," said Arwan of the National Mandate Party (PAN).

The fate of the Jakarta gubernatorial election, which will be held on September 17, will be in the hands of 84 councillors, 30 of which come from PDI Perjuangan, 13 from PAN, 12 from the United Development Party, nine from the Indonesian Military (TNI)/National Police faction and eight from the Golkar party. The rest belong to several minor parties.

Mega stuns own party by backing governor

Straits Times - June 27, 2002

Marianne Kearney, Jakarta -- President Megawati Sukarnoputri's overriding concern with securing her future through political deal-making is causing ripples in Indonesia's most hotly contested political race after the national elections.

She stunned cadres from her PDI-P party this week by backing current Jakarta Governor Sutiyoso for a second term rather than one of her own legislators. The former military commander was accused of engineering violent attacks on her party headquarters in 1996.

Legislators say that by calling on Jakarta legislators to vote for Governor Sutiyoso, Ms Megawati stands accused of having abandoned her most ardent supporters -- the people -- as well as her own party cadres and the loyalists who stood by her during the Suharto years.

Party members in parliament as well as the local assembly and those close to the president were 'amazed and dumbfounded', according to University of Indonesia political analyst Andi Mallarangeng.

Professor Mochtar Buchori, a PDI-P legislator, added: "She seems to have forgotten her mission to improve the life of the people and just doesn't listen to the ordinary people."

Backing a former military man to rule Jakarta would minimise opposition during the 2004 elections, according to some analysts. Others suspect she may have negotiated a political deal with Mr Sutiyoso. Such a move could cost Ms Megawati her grassroots supporters, the professor said.

Mr Sutiyoso's crackdown on petty traders and rickshaw operators, as well as his failure to deal with floods this year, had attracted public criticism, he added.

On Tuesday, hundreds of PDI-P members staged a rally outside her Jakarta government offices calling Ms Megawati a 'traitor' for supporting Mr Sutiyoso when he was still a suspect in the 1996 attacks.

Mr Sutiyoso was the Jakarta garrison commander when the military and others seized control of the headquarters of the PDI-P, which was then in opposition.

Ironically, analysts now accuse Ms Megawati of imitating the tough approach of former president Suharto who tried to oust her as PDI-P leader in 1996.

"In the old days, Suharto appointed whoever he wanted as governor and everyone had to accept it, now Mega is repeating this process," said Mr Mallarangeng.

With backing from the PDI-P, which holds most seats in Jakarta's parliament, and the military and police faction, Mr Sutiyoso would easily be elected. Several PDI-P legislators have vowed to defy party orders.

The surprise over Ms Megawati's backing for Mr Sutiyoso was captured in the local papers. A cartoon in the Koran Tempo had Ms Megawati with her hands over her eyes, pushing Mr Sutiyoso. The caption read: Close the eyes and ears when choosing the Jakarta Governor.

The popular tabloid Rakyat Merdeka ran the front-page headline: Sutiyoso is apparently a secret PDI-P cadre, drawing attention to the fact that he was not even a PDI-P member.

Legislators admit to having ignored their constituents

Jakarta Post - June 26, 2002

Kurniawan Hari, Jakarta -- A number of legislators admitted on Tuesday that they had largely ignored their constituents, but shifted the blame for this neglect to Indonesia's electoral system.

The deputy chairman of the United Development Party (PPP) faction in the House of Representatives, Chozin Chumaidy, said the severe lack of communication between legislators and their constituents was a direct result of the country's proportional electoral system.

"We have adopted a proportional system, which requires voters to choose the symbols of political parties [when voting]," Chozin told The Jakarta Post on Tuesday.

A legislator from President Megawati Soekarnoputri's Indonesian Democratic Party of Struggle (PDI Perjuangan), J.E. Sahetapy, echoed Chozin, saying the distance between the people and their representatives in the legislature was the result of the country's electoral system.

Chozin called for the adoption of a combination of a proportional and district electoral system, which would enable voters to choose their representatives.

Under the proportional system, people vote for political parties, which choose their representatives in the legislature. With a district electoral system, people would vote for individuals, compelling candidates to go out and meet and greet the people.

A survey conducted by the International Foundation for Election Systems Indonesia showed the majority of Indonesians could not identify their representatives in the legislature.

Of the 3,580 people surveyed nationwide, only 4 percent were able to name their representatives in the legislative body.

"I am surprised by the results of the survey; perhaps we have to encourage more meetings with our constituents," Chozin said.

Sahetapy, however, rejected suggestions that political parties were exploiting the public to further their own narrow interests.

The executive director of the Center for Electoral Reform, Smita Notosusanto, disputed claims that the proportional electoral system was to blame for legislators ignoring their constituents.

"It all depends on the political will of legislators. They could open an office to hold meetings with their constituents if they wished," Smita told the Post.

Ferry Mursyidan Baldan of Golkar acknowledged that there was a lack of communication between legislators and constituents.

But Ferry also disagreed that the situation was the result of the proportional electoral system, which the nation has employed for years. "Don't place the blame on the system. This is simply because of a lack of responsibility on the part of legislators," he said.

Ferry, who is the deputy chairman of House Commission II for home and legal affairs, said many legislators slighted their constituents, but claimed that this did not represent the majority of legislators.

He also said House members had the time to meet with their constituents and discuss their problems and wishes. The current schedule for the House gives legislators four months off each year.

Let the people elect their president: Survey

Jakarta Post - June 25, 2002

Jakarta -- If the People's Consultative Assembly (MPR) is going to allow the people to directly elect the president and vice president in 2004, then it should allow them to make that selection all the way through, rather than halfway.

In a survey by Taylor Nelson Sofres Indonesia, 74 percent of the 3,580 people polled endorsed a direct election to choose the nation's next president and vice president.

If the direct election method failed to settle the issue, quite likely given the present open field, 55 percent of the respondents felt there should be a second round of elections.

Only 28 percent felt that the task should be entrusted to the MPR. The remaining 17 percent said they had not formed an opinion.

The MPR is currently debating the presidential election issue as part of the draft to the Fourth Amendment to the Constitution, which is expected to be endorsed at its annual meeting in August.

While there is a consensus on a direct presidential election, instead of going through the MPR, the assembly is still divided on how to settle the matter if the election were to prove inconclusive.

The MPR's committee preparing the amendment has come up with two options: Organizing a second-round election, or handing the matter back to the MPR.

The factions in the MPR were accused of political horse-trading in 1999 when Abdurrahman Wahid was elected as president even though his Nation Awakening Party (PKB) had come third in the general election.

Megawati Soekarnoputri, whose Indonesian Democratic Party of Struggle (PDI Perjuangan) won the general election, took the vice presidency. Golkar, which came second, saw its chairman, Akbar Tandjung, clinching the House speakership while chairman of the National Mandate Party (PAN) Amien Rais, whose party came fifth, secured the speakership of the MPR.

Hamzah Haz, whose United Development Party (PPP) came third, secured a post in Abdurrahman's cabinet before he was promoted to vice president when Megawati became president in July last year.

The survey was inconclusive on two other matters regarding the presidential election.

Only 46 percent of the respondents said the president should be nominated by political parties; 48 percent said the president and vice president should be elected as a single package.

A boost for the career of vice-president

Radio Australia - June 25, 2002

Indonesia's Vice-president, Hamzah Haz, has won the backing of a powerful group from his Islamic party for a possible presidential challenge in 2004.

The chairman of the United Development Party's in East Java, Hafidz Ma'shum, says its 38 branches have all agreed to push for the nomination of Mr Haz as the party's presidential candidate.

East Java, a traditional Muslim stronghold, has the largest provincial chapter of the United Development Party which is the country's main Islamic party.

The vice-president was last week quoted as saying that he would be prepared to be nominated for the presidency in 2004 if the people wanted it.

He has been criticised for his meetings with a Muslim cleric who has been linked by Singapore to regional terrorism and with the detained leader of an Islamic militia.

Critics say he is seeking support from hardline Muslim groups before the 2004 elections.

The People's Consultative Assembly elects a president and a vice president following legislative elections which are held every five years.

Megawati rated highest in spite of government failing: Survey

Jakarta Post - June 24, 2002

Jakarta -- President Megawati Soekarnoputri has performed better than all other national political leaders currently in office, even as her government isdeemed to be failing in delivering the goods, according to a recently published survey.

More than 53 percent of 3,580 people polled said they were satisfied with Megawati's performance, compared with 51 percent for Vice President Hamzah Haz, 22 percent for corruption scandal suspect House Speaker Akbar Tandjung and 43 percent for People's Consultative Assembly (MPR) Speaker Amien Rais.

With the presidential election two years away, the finding could be an indication of their standing today, as the four leaders are the main contenders for the 2004 election: All chair their respective politicalparties, the Indonesian Democratic Party of Struggle (PDI Perjuangan), the United Development Party (PPP), the Golkar Party and the National Mandate Party (PAN).

With none of the contenders holding a commanding lead, the 2004 election promises to be a very close contest.

The survey, carried out in April by Taylor Nelson Sofres Indonesia in cooperation with the International Foundation for Election System (IFES) Indonesia, was commissioned by the House and the MPR to test public opinion about the current political situation.

That she outperformed all the other political leaders seemed to be about the only good news for Megawati.

The respondents virtually gave the thumbs-down when it came to the performance of her government. The majority (62 percent) said the government had not brought about any improvement, and only 34 percent feltthere had been some progress. The 3,580 respondents were selected randomly from urban (36 percent) and rural (64 percent) areas in all 30 provinces.

Corruption/collusion/nepotism

Casino 'used to launder money'

Australian Associated Press - June 30, 2002

Jakarta -- Corrupt Indonesian businessmen used Australia's high- rolling Christmas Island casino to launder money when it was owned by a crony of Indonesia's former dictator Suharto, a former shareholder believes.

The ABC's Four Corners program was told billions of dollars flowed through the gambling house, providing a tax bonanza to the Australian Government until it was shut in 1998 as a result of the Indonesian economic crisis.

Gamblers from Jakarta would pour on to the Australian island territory, only one hour's flight away away by private jet, betting up to $1 million a card.

In an interview with Four Corners, the casino's Australian developer and 10 per cent shareholder, Frank Woodmore, said, "I used to ask my colleagues Indonesians where the money came from, and the answer was really that it was just the way that these people operated in Indonesia.

"They had a very substantial black economy ... it was probably very largely from corrupt practices on their part. It was quite noticeable that we often recycled the same old players; the same people were coming in time and time again. Now that did give some suggestions that maybe there's money laundering going on."

The ABC program, screened tonight, quotes former casino staff as saying that high-rollers would arrive on the island with bag loads of money, very likely the proceeds of illegal activities such as drugs, prostitution and arms trading.

The casino's entertainment manager, Tony Mockeridge, said, "If you scratched the surface you'd find very, very quickly that they were involved in drugs, prostitution, arms dealing ... that sort of thing."

The report comes as investors plan to reopen the casino, raising the question as to how today's regulators would deal with a new operation on Christmas Island.

The casino would be established only if Asia Pacific Space Centre decides to establish a Russian satellite launching operation on the island.

Four Corners said that over the five years the casino operated, 90-per cent owner Robby Sumampow flouted Australian law aimed at stopping casino owners from profiteering.

At a time when the Australian Government was keen to forge closer links with Indonesia, Mr Sumampow had the blessing of Indonesia's then all-powerful president Suharto through Suharto's favoured younger son Hutomo "Tommy" Mandala Putra.

Suharto's 32-year regime ended in May 1998 and Tommy is now in jail in Jakarta on charges that he ordered the assassination of a Supreme Court judge who sentenced him to jail.

The report said Mr Woodmore believed that Tommy had a 20 per cent stake in the business. During the casino's heyday, he was a frequent visitor, placing up to $250,000 on one card.

Mr Sumampow had close links with the Indonesian military's operations in East Timor during its 1975 to 1999 occupation, holding valuable coffee and sandalwood monopolies there.

General Benny Murdani, who oversaw Indonesia's annexation of East Timor, was believed to have a 5 per cent stake in the casino, the report said.

No more mark-ups in arms deals, vows military chief

Agence France Presse - June 24, 2002

Jakarta -- Indonesia will no longer buy weapons at inflated prices, its military chief vowed yesterday, amid concerns that people were illegally making unwarranted profits from mark-ups.

General Endriartono Sutarto also said that he would launch an investigation into any indication of irregularities in the purchase of weapons and other military hardware, according to the Kompas daily.

"If there are really indications of a mark-up, then it should be followed up," it quoted him as saying in the Central Java city of Yogyakarta.

His comment came after President Megawati Sukarnoputri said on June 18 that she was committed to stopping mark-ups in the purchase of weapons and other military equipment.

One sale likely to come under scrutiny is the purchase in the early 1990s of 39 ships used by the former East German navy. The ships -- 16 Porchim-class corvettes, 14 Frosch-class LST troops carriers and nine mine sweepers -- together with spare parts and ammunition were bought for US$12 million.

About US$230 million, from German loans, were used to renovate the ships. But less than 10 years later, only 10 of the ships are operational.

From scrap in Singapore ... to luxury car in Indonesia

Straits Times - June 29, 2002

Marianne Kearney, Jakarta -- Forking out $60,000 for a five-year-old Mercedes S-Class, bound for the scrap yard is a luxury few Indonesians can afford.

But for the rich, such a car -- deregistered in Singapore and smuggled into Indonesia -- is a bargain. It costs far less than a new, imported Mercedes S500 that carries a tag of between 700 million rupiah and one billion rupiah.

A ministerial decree enacted in the mid-1980s aimed at protecting local carmakers banned the import of second-hand vehicles. According to the Department of Customs and Excise, only 25-tonne trucks are exempted from this ruling. As a result, Indonesians looking for affordable second-hand cars have turned to smuggled vehicles.

In turn, Indonesian dealers -- along with some police and Customs officials who reportedly facilitate smuggling activities -- are making good money by selling luxury second-hand Singaporean cars to wealthy Indonesians.

Dealers in Singapore say they sell several cars a week, and it is estimated that around 1,000 to 1,500 cars are smuggled into Indonesia every year.

In Singapore, second-hand car dealers are allowed to export to foreign buyers as long as cars are deregistered and have obtained an export form or Cargo Clearance Permit, which lists the engine number of the car, the Land Transport Authority in Singapore said.

Dealers contacted in Singapore disclosed that they get inquiries and visits from lots of Indonesians every week, mostly from Batam but some from Jakarta as well. They said that Mercedes-Benz models and luxury cars were the most popular among Indonesian buyers.

The smuggling of cars came into focus several weeks ago when former Jakarta police chief Sofyan Yakob was linked to a group which smuggled dozens of cars into South Sulawesi.

Ever since the police launched an investigation into the case, many car smugglers and dealers have gone underground and stopped their activities through Jakarta's Tanjung Priok port.

But even with the crackdown on smuggling through Jakarta, others have found ways of getting around the heightened checks.

"Shipments can be moved to Lampung, Cirebon or Surabaya. Documents are falsified -- the forms show that it's not cars being imported but household goods, textiles or toys," one Indonesian car dealer told Tempo magazine.

The dealer said he worked with large-scale smugglers who knew how to work the ports.

The smuggling racket has been helped by some police officers who issue special emergency licence plates to hide the fact that the cars are not new and lack import documents. The emergency licences are only supposed to be issued to state or police officials.

The racket is a significant source of off-budget funds for the police: Each emergency licence plate costs 30 million rupiah, say car dealers.

Smugglers say they can also bribe Customs officials for documents proving the cars are brand new. This costs approximately 100 million rupiah.

On top of this, the smugglers need to buy a number plate for around 500,000 rupiah and police registration which costs a further 2.5 million rupiah.

In one case, even used cars which were a gift from the Japanese government to the Irian Jaya government found their way in the used-car black market in Jakarta.

Despite the lucrative racket, Mr Hari Agung, the director-general for Land Transport Imports, says the Customs Department has no plans to amend the laws blocking the import of second-hand vehicles.

Police chief Da'i Bachtiar also said an investigation by the department is focusing on whether Gen Sofyan violated police rules, and not on whether several smuggling rackets are at work.

Regional/communal conflicts

Inaction on Maluku violence 'reigniting separatist cause'

Straits Times - June 24, 2002

Marianne Kearney, Jakarta -- Unlike its aggressive attempts to crush separatist rebels in Aceh, the Indonesian government has been half-hearted in ending the equally alarming sectarian conflict in Maluku.

Ironically, inaction in the province -- which has witnessed bloody clashes between Muslim and Christian extremists despite a peace accord in February -- had reignited the separatist movement there, said analysts. "Aceh is taken seriously by the government but the Malukus are not," a Western diplomat said.

The government's differing stance is explained by the fact that Aceh militants demanding independence are perceived as far more threatening than the religious militants who merely threaten civilian lives, according to the observers.

Police in the Malukus have been reluctant to heed calls from both the central government and the Malukus' governor to arrest the leaders of militant groups, such as the Laskar Jihad, which have been active there.

But in Aceh, the military and mobile police have been aggressively launching operations against the armed separatists since President Megawati Sukarnoputri authorised a new military operation last year.

Jakarta was ignoring the Malukus at its own peril, said the Western diplomat. "The joke is that now the government's lack of action over the violence in Maluku has re-created the separatist movement. RMS was refounded in November 2000 after the arrival of Laskar Jihad," he said, referring to the Republic of South Maluku Movement (RMS).

RMS was an independence movement formed in the 1950s, but most of its members fled to the Netherlands when it failed. It had not been heard from again until 2000. Another independence movement, the Maluku Sovereignty Front (FKM), has also sprung up.

The military had shown little urgency in solving the conflict because it was not their responsibility, said Moluccan sociologist Tamrin Tomagola.

The military had appeared more committed to ending the conflict, said observers, after a revamp placed a military commander -- rather than police -- at the helm of the security operations.

Curiously, the presence of the Laskar Jihad is now an impetus for a crackdown on the RMS after Vice-President Hamzah Haz suggested that the religious fundamentalists could not be expelled from the province until the separatists had been thrown out as well.

"The separatist element has given the security forces a good excuse to crack down on Laskar Jihad," said the diplomat. Also, RMS has minimal local support, which makes it an easier target.

Other observers noted that top Security Minister Susilo Bambang Yudhoyono had begun to take action to end the three-year-old conflict in the Malukus. Along with Welfare Minister Yusuf Kalla, he promised that the February peace accord would bring peace.

Human rights/law

IMF wants reform of Commercial Court

Jakarta Post - June 24, 2002

Fitri Wulandari, Jakarta -- The International Monetary Fund has stepped into the public debate over the Commercial Court's bankruptcy ruling on PT Asuransi Jiwa Manulife Indonesia (AJMI), saying the case should serve as a trigger point for Indonesia to speed up reforms in the Commercial Court and revision of the Bankruptcy Law.

"Legal and judicial sector reforms remain critical to a sustained improvement in the investment climate. A recent high-profile controversial ruling underscores the need for an acceleration of reforms in this area," Anne Krueger, IMF's first deputy managing director and acting chair, said in a statement on Friday while disbursing US$358 million of its latest loan tranche to Indonesia.

An IMF spokesman confirmed that Krueger was referring to the bankruptcy ruling on AJMI, the Indonesian unit of Canada's insurance giant Manulife Financial Corp., according to Dow Jones.

"More forceful progress is needed, notably with respect to creation of an anticorruption commission, reform of the Commercial Court and revision of the Bankruptcy Law," Krueger stressed.

The Commercial Court declared two weeks ago AJMI bankrupt after a receiver of now closed down, former partner PT Dharmala Sakti Sejahtera (DSS) filed a bankruptcy petition over failure in 1999 to pay a dividend, payment of which shareholders had not authorized.

Lawyers have hailed the IMF appeal. However, they stressed different points on the issue.

Luhut Pangaribuan stressed the need for reform within the court, that is judges in the Commercial Court, rather than revision of the Bankruptcy Law.

"The judges need to be reformed because they are corrupt," he told the Jakarta Post over the weekend.

No matter how good the law is, the judges can always bend it or find loopholes, he stressed. Luhut said it would take a long time for reform of the Commercial Court to bear fruit given the corrupt judges there.

As such, as a short-term solution, he suggested that the government appoint ad-hoc judges to accompany the judges in trials. The ad-hoc judges could be selected from among legal practitioners and should pass scrutiny by the House of Representatives.

"If corrupt judges were to remain in the Commercial Court, it would be better if trials in the Commercial Court were also done by ad hoc judges," he remarked.

"The ad hoc judges could be legal practitioners selected by the House of Representatives through a fit and proper test," Luhut suggested Bankruptcy specialist Hotman Paris Hutapea also welcomed the IMF's call, but stressed the need for revision to Law No. 4/1998 on bankruptcy, which he said had many weaknesses.

Hotman said that the logic of the law was weak because a company that failed to repay one of its debts could be declared bankrupt by judges even if it was solvent, meaning it had assets much greater than its liabilities.

According to Hotman, the concept of the prevailing Bankruptcy Law was made by Dutch law expert Jerry Hoffe together with the IMF with the purpose of forcing recalcitrant local debtors to repay their debts to foreign creditors.

If revision is done, the conditions to declaring a company bankrupt should be clearer, he said.

"Are we going to declare a company bankrupt after we thoroughly examine its financial condition or just by deciding that it has failed to repay one mature debt?" he said.

Rachmat Bastian, also a bankruptcy lawyer, said should the revised law oblige judges to take into account solvency in bankruptcy cases, the revised law should also extend the period of time for the Commercial Court to deliver its verdict to allow it to examine the solvency of the company being tried.

At present, the Commercial Court has only 30 days to examine a bankruptcy petition before delivering a verdict. "This is not enough to prove whether one company should be declared bankrupt," he said.

Focus on Jakarta

Demonstrations around Hotel Indonesia to be banned

Jakarta Post - June 25, 2002

Ahmad Junaidi, Jakarta -- The Jakarta Administration announced on Monday its plan to propose a bylaw which will ban demonstrations around the newly renovated Hotel Indonesia traffic circle on Jl. MH Thamrin in Central Jakarta.

"It [the bylaw] is needed to protect the traffic circle. We don't want the money spent on the fountain to have been in vain," Governor Sutiyoso said, referring to the Rp 14 billion (US$1.5 million) project.

Sutiyoso inaugurated on Sunday the completion of the renovation of the traffic circle, which was built in five degrees of declivity. The project was funded by an outdoor advertising agency, PT Media Indra Buana, in exchange for 10 billboard plots in strategic locations in the city, including around the circle, for two years.

The Hotel Indonesia traffic circle has become a popular spot for street rallies since the downfall of authoritarian President Soeharto in May 1998 due to its strategic location.

The rallies usually caused heavy congestion. The demonstrators often jumped into the fountain pond and some have even been known to climb the 17-meter-high Welcome Statue located at the center of the circle.

The administration once positioned large flower pots around the circle to prevent the rallies but they were soon broken by demonstrators.

Sutiyoso told reporters at the City Hall on Monday that the water fountain in the traffic circle is expected to prevent demonstrators from climbing the Welcome Statue.

Separately, councillor Dani Anwar of the Justice Party rejected Sutiyoso's idea to ban demonstrations around the traffic circle, saying that it was an attempt by Sutiyoso to take away people's rights.

"The police can arrest demonstrators who destroy the circle, but we should not ban people from conducting rallies [around the circle]," said Dani, whose party supporters have often held large, peaceful rallies at the circle.

He said that forbidding people from conducting rallies would be against Law No. 9/1999 which allows people to conduct rallies on condition that they notify the police beforehand.

Student activist Adi Putra Binarta of privately-run Trisakti University questioned the motivation behind Sutiyoso's proposal to ban the rallies at the traffic circle.

"Maybe Sutiyoso wants to create an image that he can manage some semblance of order in the city so that he can be reelected in the next gubernatorial election," said Adi, who joined a rally at the circle three months ago.

Sutiyoso had earlier been sharply criticized for his decision to install a fence around the National Monument Park (Monas), which is also a popular spot for demonstrations. Activists also believe that Sutiyoso wanted to block rallies by fencing the park, but the administration said the fence was aimed at preventing street traders from operating in the area.

Jakarta celebrates 475th anniversary

Associated Press - June 24, 2002

Jakarta -- Thousands of people gathered on the streets here yesterday to celebrate the 475th anniversary of Indonesia's capital -- one of Asia's most crowded and polluted cities.

"I love and hate Jakarta," said Ms Siti Maimunah, a vendor selling coconut ice cream to the celebrating crowd yesterday, the first day of a two-day celebration. "It's where the jobs are but it's so hard to live here," she said, echoing the sentiment of many of the city's residents.

Jakarta, which is on Indonesia's main island of Java, is home to more than 10 million people who suffer through the city's traffic-clogged roads, poor public transportation, polluted air and open sewers every day.

The city's population includes the poor from all over the archipelago, who flock to the capital for jobs and a better life, only to be evicted from their makeshift homes by the city administration.

In January and February, Jakartans had to endure more hardship as torrential rains triggered floods that left areas of the city under water for weeks.

Despite their troubles, the thousands who turned out yesterday were in a celebratory mood. Dozens of parties were being planned across the city.

One of the city's most beloved landmarks -- a fountain near the site of many of the protests in 1998 that led to the fall of former president Suharto -- was reopened last night after a 14- billion-rupiah renovation.

Meanwhile, hundreds of gaily decorated cars and motorcycles tooted their horns during a two-hour-long parade that ended in the city centre.

Jakarta was founded in the early 14th century and became one of the biggest international seaports in Asia. It was called Batavia during Indonesia's four centuries of Dutch rule.

Informal sector/urban poor

Fare hike another slap in the face for the poor

Jakarta Post - June 27, 2002

Berni K. Moestafa, Jakarta -- Widespread criticism of the government is growing as transportation fares are set to go up by 40 percent following its earlier fuel price increases.

Critics slammed the decision as a slap in the face of the poor, and called into question the government's unilateral approach of raising the fares.

"It's bad. Companies can weep on the government's shoulder if fuel prices go up but the poor have nowhere to go," said Wardah Hafidz of the Urban Poor Consortium (UPC) on Wednesday.

The government has said it would raise transportation fares by between 28 percent and 40 percent through two stages starting next month and January 1, 2003. All fare increases will apply for economy class seats, thereby affecting mainly the lower-income group.

Media reports quoted the government as saying on Tuesday that ferry tickets will increase by 40 percent, trains by 40 percent, and inter-city buses by 28 percent. The decision followed complaints by transportation owners after the government raised fuel prices four times this year.

State oil and gas company Pertamina is selling fuel at 75 percent of international market prices as part of the government's effort to phase out fuel subsidies. "I'd say scrap or delay the fare hikes," Wardah said.

With the school season arriving, she said, parents of poor families were also burdened with school fees. "Usually this is the month, that lower-income families devote all their resources to getting their children into school. The entrance may be free now, but uniforms and school contributions are not," she said.

A Rp 2.85 trillion (about US$328.15 million) fuel compensation program has been drawn up to protect the poor from the impact of the fuel price hikes.

According to the government, the number of poor people in the country is about 40 million, with monthly expenditures ranging from Rp 72,000 to Rp 95,000. Under the compensation program, each poor family with an average of five members, should receive about Rp 350,000 worth of assistance.

But Wardah said the compensation fund failed to reach its intended target. "Only the higher class among the poor have received the funds, the real poor people like scavengers and squatters remain out of reach," she said.

Azas Tigor Nainggolan of the Jakarta Citizens Forum said the government should drop its unilateral approach when deciding to raise transportation fares. It should take inputs from consumers, he said. "The fare hikes show that the government is bowing to transportation owners." Chairperson of the Indonesian Consumer's Foundation (YLKI), Indah Sukmaningsih said the government turned the costlier fuel price into an easy excuse to raise fares. Many problems of transportation companies lied outside of higher fuel prices, she said.

"People from the ferry sector complain about costly fees at ports. Others complain about illegal levies along their routes ... what is the government doing about that?" she asked.

An executive at the Association of Land Transportation Owners (Organda), G.T. Surbakti defended the decision to raise fares as necessary amid a reeling transportation industry.

Higher prices of fuel and spare parts due to the rupiah's sharp depreciation in the last four years against the US dollar have put a strain on transportation owners to improve services or even to maintain their fleet.

Surbakti said that even the 40 percent increase in fares was inadequate to cover the higher fuel cost since the beginning of this year.

News & issues

Police blasted for failing to uphold press freedom

Jakarta Post - June 29, 2002

Muhammad Nafik, Jakarta -- Frequent cases of violence and intimidation against journalists by police personnel across the country reflects their serious lack of understanding of the freedom of the press, an activist says.

"Recent abuses against journalists by police show that they refuse to support press freedom amid the reform era," Adnan Pandupradja, who chairs Police Watch, a non-governmental organization, told The Jakarta Post on Friday.

He also criticized the police for failing to control their members who often used violence to deal with journalists covering sensitive events.

The number of reporters who have become easy targets of attacks by security forces has increased steadily since President Megawati Soekarnoputri ascended to the presidency in July 2001.

According to the Alliance of Independent Journalists (AJI), at least 58 cases of physical assaults on reporters were recorded from May 3, 2001 to May 3 this year.

The victim of the latest attack, Wisnu Dewabrata of the leading Kompas daily was beaten by police officers while covering a labor strike at PT Maspion based in Sidoarjo, East Java on Wednesday.

The officers, who chased striking workers that clashed with them, also seized Wisnu's identity card and camera. Earlier last month, an SCTV reporter suffered a similar assault from police personnel in the troubled province of Maluku.

Socio-political observer Fachry Ali concurred, saying the police were sill reluctant to support press freedom in the post-Soeharto regime. The police still feel they are soldiers, not public security personnel who must protect members of the society, including journalists, Fachry said. He told the police to consider the media a partner instead of an enemy in carrying out their duty of enforcing the law.

He and Adnan urged National Police chief Gen. Da'i Bachtiar to take a stern action against his members who assault and intimidate members of the press. "If Gen. Da'i is serious in upholding press freedom, he should issue a firm instruction to all his personnel to stop violence against journalists," Adnan said.

A similar view was expressed by retired police general Awaluddin Djamin, who said Da'i should seriously look into attacks on reporters. He said the police must take firm legal action against their officers involved in attacks on members of the press because it was one of the "sensitive" national issues. "This could boost the police's credibility," he added.

Awaluddin also backed moves by publishing companies to prosecute police members accused of beating or intimidating their reporters.

Yet, he denied claims that assaults on journalists meant that the police were campaigning against the media so as to be able to reestablish repressive security measures against troublemakers as was practiced under Soeharto's 32-year authoritarian rule.

Tommy Suharto says president Wahid wanted him jailed

Agence France Presse - June 26, 2002

Tommy Suharto, the youngest son of Indonesia's former dictator, testified for the first time in his murder trial and accused the then-president of interfering in his earlier corruption case.

Hutomo "Tommy" Mandala Putra is currently on trial for possessing weapons and for ordering the contract killing in July 2001 of Supreme Court judge Syafiuddin Kartasasmita. Both offences are punishable by death.

In September 2000 the Supreme Court, which Kartasasmita headed, overturned an acquittal by a lower court and ordered Tommy jailed for 18 months for a corrupt land deal.

The former millionaire playboy said he, his lawyer and three other friends met Kartasasmita at the latter's house in October 2000 to ask the reason for the conviction and sentence. Tommy at the time was free pending an official order committing him to jail.

Tommy said Kartasasmita told him that then-president Abdurrahman Wahid had interfered in his case by asking the Supreme Court to overturn the lower court's acquittal.

"I knew all along that I would lose my case because of intervention from the palace," a relaxed Tommy told the court, adding that he had earlier received such information from sources at the Supreme Court. "He [Kartasasmita] ... confirmed there was a demand from the palace," he said.

Tommy said the judge asked him at the meeting to get the "green light from the palace" if he wanted further action.

Tommy said that the same month he met Wahid twice at separate smart hotels. The president told him to go ahead with his plan to apply for a review of the verdict and promised he would not interfere in the case.

Tommy said two men close to Wahid who helped arrange the meeting later asked for 15 billion rupiah (now 1.7 million dollars) to help smooth his appeal process. They promised to return the cash if the review application was rejected. Tommy also applied for a presidential pardon but Wahid turned him down.

Tommy failed to turn himself in to serve the jail term by the November 3, 2000 deadline and went on the run. In October last year, in a controversial twist to the case, a separate Supreme Court panel granted Tommy's request for a review of the verdict and quashed the corruption conviction.

But police arrested him the following month on suspicion of ordering the judge's murder. They say they also found arms caches in two properties linked to Tommy during their year-long search for the country's most famous fugitive.

Tommy, a symbol of nepotism during his father's 32-year rule, has maintained his innocence of the murder and weapons charges.

Two men who were allegedly paid 10,000 dollars by Tommy to kill the judge were sentenced to life in prison on May 8. The trial was continuing.

Bus owners protest over bus seizure

Jakarta Post - June 28, 2002

Cirebon -- Hundreds of bus owners grouped under the West Java and Central Java Organization of Land Transportation Owners (Organda) demanded on Thursday the release of 117 buses currently impounded by the Jakarta office of the Ministry of Transportation, apparently without good reason.

In a media conference on Thursday, spokesman of the protesting bus owners Iskandar Agus Banadji said that they demanded Jakarta Governor Sutiyoso immediately release the buses, which were seized last month. "We will report the case to Jakarta provincial legislative council and other government institutions, should the governor allow the impoundment of those buses to continue," Iskandar said.

He claimed that the intercity buses were impounded without good reason and the Jakarta administration had sought a "ransom payment" for their release.

"For each bus, they sought Rp 1.5 million to Rp 5 million in 'compensation money'," Iskandar charged, adding that a bus company suffered Rp 500,000 in losses per bus per day due to the impoundment.

The bus owners threatened to stage a protest, along with the crews, at the Jakarta administration if their demands were ignored.

Legislators, editors reject tax on reading materials

Jakarta Post - June 28, 2002

Kurniawan Hari, Jakarta -- In an effort to lower book, newspaper and magazines prices, editors and legislators on Thursday agreed to demand the government remove the imposition of value-added tax (VAT) on reading material.

They said getting rid of the tax would bring down the prices of newspapers, magazines, and books which would boost sales and increase reading among the public.

Deputy Chairman of House Commission I for broadcasting and media Effendy Choirie pledged his commission would soon discuss the matter with the Minister of Industry and Trade and the finance ministry's director general.

VAT accounts for 10 percent of the prices of printed material. It means an additional cost for readers.

Leo S. Batubara of the Association of Newspaper Publishers (SPS) said the total amount of VAT paid by newspapers to the government was Rp 140 billion last year. As of June this year, he said, the amount had reached Rp 70 billion.

"Knowledge should not be taxed," Leo said. He added the high prices of newspapers were also to blame for their low circulation.

There are about 566 publications in Indonesia, but only 30 percent of them are profitable. Home to more than 210 million people, Indonesia's daily newspaper circulation stands at 4.8 million copies, far below the United Nations Educational, Scientific, and Cultural Organization's (UNESCO) ideal daily circulation of 22 million copies.

Chief editor of Media Indonesia daily Saur Hutabarat suggested the public should not be required to pay VAT on books and newspapers. "Books and newspapers educate the public. Therefore, there should be no need to impose VAT on those items," said Saur.

Chief editor of Kompas Suryopratomo and deputy chief editor of The Jakarta Post Endy M. Bayuni agreed with Saur that the VAT must be dropped. "VAT has raised the prices of books and newspapers," said Suryopratomo.

A number of legislators clearly expressed their support for the removal of value-added tax imposed on books and newspapers. "Tax on knowledge is senseless. This must be removed," said legislator Astrid S. Susanto.

During the hearing, legislators also questioned the performance of Antara state news agency. Head of Antara Mohammad Sobary said he had decreased the agency's deficit from Rp 7 billion to Rp 2.3 billion and fired several employees found guilty of embezzlement and fraud.

'Kompas' enraged by assault case

Jakarta Post - June 28, 2002

Fabiola Desy Unidjaja, Jakarta -- As part of the campaign to put an end to the long list of assaults against the Indonesian media, Kompas daily vowed on Thursday to proceed with the legal process against the police for beating one of its reporters while reporting the Maspion worker strike in Sidoarjo, East Java.

The daily's Deputy Managing Editor, Taufik H. Mihardja, said on Thursday that Kompas would not be satisfied with an apology from the police and somebody had to be legally punished for the incident. "We have reported the incident to Sidoarjo police and are studying further possible legal steps for the assault," Taufik told The Jakarta Post.

Journalist Wisnu Dewabrata was beaten up by officers from the Sidoarjo police force, while covering a strike on Wednesday involving thousands of Maspion workers.

As the strike heated up, the police started to chase down the workers and a clash broke out, leaving at least five workers injured. Wisnu, who was among the crowd, was also hit by a police billy club, and his press identity card and camera were taken away by the officers.

Taufik said Wisnu only suffered minor injuries and continued to work and report on the strike. He asserted that it was not a matter of how serious the injuries were, but the rights of the press to report certain events safely and without threats from security officers.

"We do not want the case to be settled with an apologetic statement, we want the perpetrators to be brought to justice for the incident. These kinds of assaults should be stopped," he said.

Assaults against the press are not something new in Indonesia, and unfortunately during Megawati's administration, violent attacks against the press and its freedom has increased.

Many have feared the country would suffer a setback in press freedom, as aside from the increasing number of assaults, the government has drafted regulations to curb the media.

Ati Nurbaiti, chairwoman of the Alliance of Independent Journalists (AJI), said Wisnu's case followed another 58 recorded cases of physical assaults on members of the press from May 3, 2001 (international press freedom day) to May 3 this year. "If this goes on, we'll have to present the police force with our annual 'Enemy of the Press' award," she told the Post.

She said that in some cases police had claimed ignorance of the press laws and asked AJI to send them a copy of the document.

"It is inconceivable that a police chief does not know the universal rule against assaulting neutral parties in a conflict situation such as journalists and humanitarian workers, and that such officers never instruct their subordinates on this matter," she remarked.

Separately, National Police Spokesman Insp. Gen. Saleh Saaf vowed that the police would follow up with the case and punish the officers involved.

"The police never have the intention to block press freedom. We fully understand that the press is our partner, but please be patient as we are still trying to reform ourselves in respecting the media," Saleh told the Post.

All KPU members threaten to quit if election bill passed

Jakarta Post - June 28, 2002

Muhammad Nafik, Jakarta -- All 11 members of the General Elections Commission (KPU) have threatened to resign en masse if the House of Representatives passes a new election bill that would effectively undermine the commission's independence.

Commission deputy chairman Ramlan Surbakti warned on Thursday that commission members would resign in protest if the bill, which furnishes the government with control over the commission, were passed.

"We'd fight first. If it is futile, we will take a firmer stance [resignation]," he stated, while two political bills -- one on elections and the other on political parties -- were being deliberated at the House.

Many believe that under the bill on elections currently being deliberated at the House, the commission would be liable to government intervention, as the commission, in its work, would be "assisted" by a secretariat-general that would function under the auspices by the Ministry of Home Affairs.

The secretary-general and deputy would be civil servants appointed and dismissed by the president based on proposals by the minister of home affairs.

The secretariat-general would also have unbridled authority as it would determine the commission's organizational structure and working mechanism. It will also manage the commission's finances and budget. The secretariat-general will also control data and information related to the electoral process, including ballot tabulation.

Ramlan had no reservations about the possible outcome of such a bill. "There's potential for manipulation and corruption in the 2004 general election if KPU has no authority to control its secretariat-general," Ramlan said.

A plethora of alleged electoral fraud from the 1999 general election still remains unresolved. Much of this had been due to the fact the previous commission was comprised of individuals and party representatives, who themselves took part in the electoral process.

Despite various objections, including from non-governmental organizations, the bill received support from senior Indonesian Democratic Party of Struggle (PDI Perjuangan) and Golkar Party legislators. PDI Perjuangan's Agustin Teras Narang even challenged commission members to make good on their resignation threat.

Golkar's Yahya Zaini further argued that despite the fact that the secretariat-general was structurally tied to the bureaucracy, the commission could still serve as an independent poll organizer.

The General Elections Commission will present its own revision to the two bills at a hearing with House Commission II on legal and home affairs on July 11, which is chaired by Teras.

Ramlan insists that full independence is an "absolute prerequisite to fair and accountable elections," and this means having full authority over its offices and staff, including the secretariat-general. He proposed that the commission set up its own secretariat-general, free of government control.

Commission members were selected last year by the House after a presidential proposal to replace the previous commission, which comprised representatives from 48 parties and five government appointees.

Throwing in the towel against Tommy?

Jakarta Post - June 27, 2002

Jakarta -- The prosecution appeared to throw in the towel on Wednesday during the cross-examination of Hutomo "Tommy" Mandala Putra, the alleged mastermind behind the murder of Supreme Court Justice M. Syafiuddin Kartasasmita.

While Chief Prosecutor Hasan Madani normally asked probing questions, this time he seemed to skip from one question to another.

Asked about his poor performance, Hasan told reporters after the hearing that he would not waste his energy as it would be useless.

"He denied everything, including everything contained in the case file, let alone our indictment. He'll just keep on denying everything," he claimed.

Tommy is facing four charges: the murder of Syafiuddin, the illegal possession of firearms at the Cemara Apartments in Central Jakarta, and in Pondok Indah, South Jakarta, and flight from justice. Each of the first three charges are capital offenses.

Despite the seriousness of the charges, Tommy's cross-examination lasted only about two-and-a-half hours. The questions mostly concerned the charge of fleeing from justice. Tommy calmly answered all the questions posed by Hasan and the judges, denying all suggestions of wrongdoing.

A defendant's statements during his cross-examination, Hasan said after the session, formed part of the evidence that went toward proving an indictment. But in the end, it was the judges who would make the final decision.

But the judges themselves did not seem to be overly enthusiastic about cross-examining Tommy. On several occasions, Presiding Judge Amiruddin Zakaria interrupted Tommy's testimony to warn the spectators not to make noise.

The case is being heard by five judges: Amiruddin, Andi Samsan Nganro, Herri Swantoro, I Ketut Gde and Pramodana K. Kusumah Atmadidja.

Judge Andi Samsan Nganro admitted that he had not given his best performance on the day as he was ill. "I jumped from one question to another because I couldn't concentrate. I have a bad flu," he told The Jakarta Post.

He said that Judge Herri Swantoro was unable to attend the trial as he was suffering from typhoid. Herri was replaced by Sylvester Djuma, who did not utter a word during the hearing.

The trial will resume on July 10, when prosecutors will present their sentence recommendation for the defendant.

Armed militia group trains outside Jakarta

Agence France Presse - June 27, 2002

Jakarta -- An armed Indonesian civilian group had held military training exercises outside Jakarta, the country's top security minister said yesterday.

Coordinating Minister for Political and Security Susilo Bambang Yudhoyono said Jakarta police chief Inspector-General Makbul Padmanegara had sent him a report detailing the recent activities of the group. But Mr Susilo said he could not reveal the group's identity and motives as investigations were proceeding.

"Although their training ground was held outside of Jakarta, it is necessary to check whether it correlates with [political and security] developments in Jakarta. They had used military supplies," he said.

It appeared the developments referred to were a series of bomb attacks in Jakarta during the past month. Two bombs have detonated, injuring six people, while two others were found before exploding.

Militia groups were used by the army to boost security during the legislative assembly session in 1998.

However, they came under strong criticism from human rights groups when the government used 125,000 civilians -- many of them from groups with reputations for thuggery -- in clashes with pro-democracy students that year which left 15 people dead and more than 400 injured.

Police protected me while I fled, says Tommy

Associated Press - June 27, 2002

Jakarta -- Taking the stand for the first time, Tommy Suharto told a packed courtroom yesterday that Indonesia's security forces had protected him while he was on the run for a year.

The son of former president Suharto denied that he had killed a Supreme Court judge but admitted that he had tried to bribe associates of a former president to clear him of corruption charges.

Tommy, whose real name is Hutomo Mandala Putra, is accused of masterminding the assassination of Judge Syafiuddin Kartasasmita in July last year after the judge sentenced him to 18 months in prison for a multi-million-dollar real-estate scam. He is also charged with two counts of illegal weapons possession and evading justice.

He was arrested in November last year after a high-profile manhunt, and he offered new details yesterday about his year on the run.

He argued that he never was a fugitive, saying he had spent most of his time at homes he owned in Jakarta or in holiday cottages across Java.

"Most of the time I spent in my own house," he said. "There was coordination with the (Indonesian security forces). It was safe there." His testimony appeared to confirm allegations by human- rights activists that police had protected Tommy on orders from his father. Police could not be reached for comment.

Appearing relaxed and joking with the judges, Tommy insisted he did not know the two hit men convicted of killing Judge Kartasasmita.

He admitted that he once had met the judge in private. But he insisted that it was only to ask why his appeal to the Supreme Court had been turned down.

"I would never do that," Tommy said, when asked if he ordered the judge's murder. "When I met him, everything was fine ... I was not angry at the judge because I knew he was under political pressure." Tommy said he also met then-president Abdurrahman Wahid in October 2000 to seek a presidential pardon after his corruption conviction.

Environment

Fishermen at a loss due to pollution

Jakarta Post - June 24, 2002

Oyos Saroso H.N., Bandarlampung -- Although compensation has been given by sugar cane factory PT Gunung Madu Plantations (GMP) to local fishermen in Lampung, the fishermen remain reluctant to go fishing due to declining fish stocks in Bandarlampung's polluted water.

They claim pollution would force them to stay home for at least the next six months.

Coordinator of the Lampung chapter of the Indonesian Forum for the Environment (Walhi) Mashuri Abdullah said on Friday that the chemicals in the sugar cane fluid could spread and cause more widespread damage.

"It has not only contaminated the water near the port, but has also spread to other areas because of the changing wind direction," Mashuri said.

Pollution in the waters around Panjang seaport was first discovered on May 8. An underground pipeline distributing sugar cane fluid from PT GMP to the docked ship Paros Valleta was found to be leaking.

The pollution destroyed much of the surrounding marine life. Fishermen feared that in the next few months, they would not be able to find anymore fish. The pollution was estimated to have killed more than 31 types of fish.

Walhi's advocacy and campaign manager Mukri Priatna said it would take at least six months to recover the polluted water. Walhi estimated 900 tons of sugar cane fluid had leaked from the pipeline, but an official at Panjang seaport claimed it was as much as 1,500 tons. PT GMP claimed there was only 300 tons. The widening contaminated area was because of the wind, it said.

PT GMP Financial Director Gunamarwan said the dissemination of fish eggs, known as restocking, could only be made in July after the compensation dispute had been resolved. "We are still assessing this matter before we distribute the fish eggs," he said.

Compensation talks turned into a dispute as about 40 people pretended to be fishermen. PT GMP, however, decided to render the compensation to 1,027 fishermen living nearby the location.

PT GMP spokesman Hapris Jawodo said the compensation was given only to fishermen living between the Hanjung area and the village of Sukaraja in South Telukbetung.

"PT GMP has provided Rp 700 million (US$77,777) compensation. To receive compensation, the fishermen have had to fulfill some requirements," Hapris said, citing ID cards and recommendations from the fishermen union and the respective village heads. The amount of compensation has varied from Rp 900,000 to Rp 200,000 for ship owners and ship crew respectively.

Chairman of the evaluation team for the granting of the compensation, Suparmo, acknowledged that several people had pretended to be fishermen in an effort to obtain the compensation. He said anyone unable to provide the required documents would find their claim declared fictitious.

Suparmo said there were at least 42 people who had pretended to be fishermen. "But, they would not be given compensation because they were unable to show the required documents." A team member and local councillor, Prabawa said that if the phony fishermen insisted on asking for compensation, the team would bring the case to the police. But if they withdrew their demand, the team would not report the matter to the authorities. "We will do that for humanitarian reasons," he added.

Health & education

Plan to beat teacher shortage

Straits Times - June 27, 2002

Jakarta -- Indonesia's Education Ministry plans to hire 366,630 temporary teachers next year to overcome shortages in schools around the country.

Education Minister A. Malik Fadjar said during a parliamentary committee hearing on Tuesday that his ministry was seeking a budget allocation of 2.3 trillion rupiah, or 200,000 rupiah per teacher, for the plan.

Legislators welcomed the move but said it would result in "unjust wages" for teachers.

Hospitals providing free health care for the 'rich'

Jakarta Post - June 25, 2002

Bambang Nurbianto, Jakarta -- The health card system aims to provide a free health service for the poor. But while many destitute people are unable to enter the program due to their lack of an ID card, employees of several hospitals admitted on Monday that many of the recipients look affluent.

Meri Silalahi, a nurse at Tarakan hospital in Central Jakarta, said that many of the cardholders were people with a university education, who owned cellular phones and wore gold jewelry.

"The hospital offers services free of charge to anyone who holds a health card. We don't ask those people how they obtained the card, because they would become angry if we were to do so," Meri told The Jakarta Post.

Tunggul Setiabudi, an employee at Koja hospital in North Jakarta, also said that he often received complaints from nurses who treated patients holding health cards.

"Some nurses told me that some patients with health cards were hospitalized here but did not deserve the free health facility," Tunggul told the Post.

However, like Meri, Tunggul also did not ask health card holders about how they had obtained their card, saying that he had no authority to do so.

Head of the City Health Agency Abdul Chalik Masulili said last week the health cards were often counterfeited and sold to people who had no right to receive free health services.

Masulili also admitted that many poor people could not enter the program because they were unable to produce a city ID card.

According to the City Statistics Bureau, there are more than 30,000 families or at least 100,000 poor people in Jakarta who do not have a city ID card.

Both Meri and Tunggul said on Monday they had received warnings from the health agency about counterfeit health cards. But they said they had never come across any.

Health cards are issued by doctors at the nearly 300 health centers in the capital for poor people with a Jakarta ID at the recommendation of subdistrict heads.

All hospital fees for health card holders become the responsibility of the city administration. The free services include surgery.

"We will provide any health service needed by a patients with a health card as long as the facility is available here," said Nurul Huda, a staff member of the public service division at Koja hospital.

She added that the hospital would provide service to any health card holder as long as the person could produce supporting documents such as an ID card, a family card and a recommendation from a health center doctor.

Dr. Makmur Mandaria of the Tarakan hospital medical service division, shared Nurul's statement, saying that his hospital was obliged to serve all health card holders without asking how they had obtained them.

Makmur said that so far the city health agency had no mechanism to monitor whether health services were reaching the right people.

He said the abuse of health facilities for the poor also occurred at a hospital in Surabaya, East Java. But such practices were stopped as the health agency in the city checked the addresses of patients who received health services.

"If they found that a patients was not poor, the person would be obliged to repay all of the hospital fees. Under such a mechanism, they could cut the reimbursement by up to 50 percent. Here, we do not have such a mechanism," Makmur told the Post.

Masulili said that his agency would issue a new type of health card so that they could not easily be counterfeited. Unlike the current health card, the new card will bear a photograph of the holder.

East Java AIDS death toll reaches 30

Jakarta Post - June 25, 2002

Jakarta -- The death toll from Acquired Immune Deficiency Syndrome (AIDS) cases in East Java has now officially reached 30.

East Java Deputy Governor Imam Supardi said there has been an increase in HIV/AIDS cases because of local people's lack of awareness.

According to data at the local health office, there have been 423 HIV/AIDS cases reported and 30 have so far died. There was no detailed data on the spread of the disease.

Imam, also chairman of the Anti-drug and -HIV/AIDS Movement Month in the province, said the number of HIV/AIDS cases in the province have increased by between 400 percent and 500 percent since 1999.

"In 1999, only three new cases were discovered every month but from 2000 to May 2002, almost eight new cases were discovered every month. Eighty percent of the cases were transferred through sexual contact, and 12.5 percent through sharing needles," he said.

Nationally, the province has the second highest number of HIV/AIDS cases after Irian Jaya, while Jakarta and Riau are third and fourth.

Imam added the local office of the Anti-drug organization has also noted a decrease in the number of drug abuse cases to 388 in 2001 from 407 in 2000.

President Megawati Soekarnoputri is scheduled to launch a nationwide anti-drug and HIV/AIDS awareness movement on Wednesday. All motorists in the province have been asked to keep their headlamps on all day long to mark the launch.

Religion/Islam

Pressure builds for scrapping of religion ministry

Jakarta Post - June 28, 2002

Muhammad Nafik, Jakarta -- Calls are mounting for the government to revamp or scrap altogether the Ministry of Religious Affairs following a recent proposal to establish a joint religion office to promote interfaith harmony.

Critics say the ministry has strayed from its core mission as a center of ethics and morality, which should take the lead in fostering close relations between followers of different religions.

"The ministry has become the focus for a power struggle between political parties, and, as a consequence, religion is the victim," said Komaruddin Hidayat, a professor at Jakarta State Islamic University (UIN).

Ulil Abshar Abdalla, from the Indonesian Conference on Religion and Peace (ICRP), also threw his weight behind the call, in the full knowledge that many Muslim groups were competing for jobs in the ministry. "The ministry appears to be a source of political pride for many Muslims," Ulil said without elaborating.

Former president Abdurrahman "Gus Dur" Wahid had sought to scrap the ministry in 1999, arguing that the government should not intervene in religious affairs as Indonesia was not an Islamic state. However, he canceled the proposal after it drew strong resistance from many circles, including leaders from his own Nahdlatul Ulama (NU), the country's largest Muslim organization.

Earlier last week, leaders of different religious organizations, along with the House of Representatives, called for the establishment of a joint secretariat to foster religious ties.

Scholars said the joint religion office would be effective if it was set up independently by organizations of different religions, with the government merely acting as facilitator. In the long run, the proposed office could take over the responsibilities of the Ministry of Religious Affairs in promoting interfaith unity.

Komaruddin said the call for such a joint religion office reflected people's frustration over the ministry's failure to bring peace to Muslims, Christians, Hindus, Buddhists and others.

However, he warned that scrapping the ministry would bring short-term "pragmatic" problems that the government and some Muslim groups had to face.

"I supported the idea of Gus Dur to dissolve the Ministry of Religious Affairs because it was not needed, but it has been too difficult to put into practice," said Komaruddin.

He added that what the government could do in practice would be to review soon the ministry's existence and activities.

"It should be revamped to become a state office dealing with religious affairs, with a limited number of officials," said the noted Muslim scholar, who resigned several months ago as the ministry's director general of state Islamic colleges.

He said that with sweeping reforms the ministry would be able "to enlighten the public and provide general policies" on how to improve ties between followers of diverse religions.

Ulil said the restructuring should include replacing many of the ministry's officials who had "conservative perspectives" on religion.

A similar view was shared by NU leader Solahuddin Wahid, who is Gus Dur's younger brother. He hoped the move would prompt the ministry to cease its engagement in operational matters. "It is impossible to scrap the ministry, but to restructure it is quite feasible," Solahuddin added.

He and Komaruddin suggested that management of the haj pilgrimage be handed over to the private sector and of Islamic education to the Ministry of National Education.

UIN Rector Azyumardi Azra said the reforms should cover the ministry's existence, its poor human resources, vision and mission in facilitating interfaith dialog.

"The Ministry of Religious Affairs should free itself of responsibility for technical matters and produce broad-minded concepts to improve relations between religions," he added.

Islamic vigilantes attack cafes in Jakarta

Sydney Morning Herald - June 27 2002

Around 150 Islamic extremists armed with sticks and swords rampaged down a street popular with foreign tourists in Jakarta yesterday, forcing their way into cafes and smashing beer bottles, police and witnesses said.

No one was injured in the midday raid on Jalan Jaksa by members of the small but hardline Islamic Defenders Front. Police were present during the attack, but made no arrests, said Lt Wagimin.

The Front has staged similar attacks in the past on discotheques and bars, which they consider un-Islamic and immoral. It also spearheaded sometimes violent protests against the US-led war in Afghanistan.

Jalan Jaksa is about a kilometre from the presidential palace. It is lined with cafes and cheap hotels catering mostly to foreign backpackers.

The attackers smashed beer bottles they had taken from the shelves of at least five establishments on the street. They also damaged signs advertising alcoholic products, witnesses said.

Indonesia is the world's most populous Muslim nation, however most of its 210 million people practice a tolerant form of the faith.

Armed forces/Police

Budget constraints shrink military might

Jakarta Post - June 29, 2002

Berni K. Moestafa and Tiarma Siboro, Jakarta -- Once the big brother amongst Southeast Asian military forces, the Indonesian Military (TNI) now suffers from acute budget constraints which are crippling its arsenal and diluting its might.

With a defense budget of 1 percent of gross domestic product (GDP), the TNI guards an area nearly six times larger than its next biggest neighbor Malaysia, which has a defense budget of about 2 percent to GDP.

"Ideally we should have a defense budget of 3.8 percent to GDP, but anything beyond 2 percent now is great," said Director General for Strategic Defense at the Ministry of Defense, Maj. Gen. Sudrajat on Friday.

TNI's budget, he said, was heavily burdened by soldiers' salaries and squeezed even more due to maintenance costs. Indonesia has some 297,000 active military members with 400,000 in reserve. Under the 2002 state budget, they must survive the year on Rp 9.3 trillion (about US$1 billion).

While soldiers continue to get paid, not all of TNI's military equipment receive proper servicing. Shortage of spare-parts and inadequate maintenance is damaging TNI's arsenal, with vehicle parts often getting cannibalized.

Data from the TNI shows that it owns 117 ships with only 30 percent operational, and 220 aircraft with just 45 percent operational.

"The drop in serviceable equipment is costing us our mobility," said TNI spokesman Maj. Gen. Sjafrie Sjamsoeddin on Friday. For instance, he said, instead of flying troops into conflict zones, the TNI must ship them.

Although the TNI no longer technically handles domestic security, rapid troop deployment remains necessary to counter armed groups in conflict-torn regions like Nanggroe Aceh Darussalam or Maluku. In addition to the domestic budget constraints, a partial military embargo by the US government, as a result of the East Timor violence, prevents maintenance of military equipment such as the sophisticated and costly F-16 Fighting Falcon jetfighters. "We purchase some of the spare-parts through third countries, but at higher prices," Sjafrie said.

Sudrajat said the TNI planned to phase out its dependence on foreign military equipment by producing most of its military equipment here. "It's a long term project though, we're looking at 30 to 40 years from now." He said President Megawati Soekarnoputri's recent visit to Slovakia and the Czech Republic was aimed at tapping their military technology.

Small arms and tank spare-parts from Slovakia, and aircraft spare-parts and radar technology from the Czech Republic, were examples he gave of the negotiations that were ongoing.

Analysts however, said Indonesia lacked a clear defense plan to guide its military industry development. "We have a defense plan, but it was done in 1982," one analyst said.

Military observer Salim Said stated that the government should update its defense plan to identify new threats and develop the military around those. A starting point could be the People's Consultative Assembly (MPR) decree No. VII/2000, under which the TNI surrendered most of the domestic security affairs to the National Police.

Analysts have said that if the TNI's only job was to deal with external threats, the government should have built up the air force and the navy instead. But neither the air force nor the navy can expect greater funding, if the government goes by its present budgeting policy.

The government spends its defense funds based on the number of personnel in each of the armed forces, said Air Force spokesman Commodore Imam Wahyudi. With 230,000 members, the Army is the clear beneficiary of this policy. The Air Force has 27,000 members and the Navy 40,000.

Kusnanto Anggoro of the Centre for Strategic and International Studies (CSIS) said that presently, Indonesia's neighbors posed no threat.

The closest threat, the dispute over the Sipadan and Ligitan islands with Malaysia remains, but its handling through diplomacy has lowered the risk of any open conflict. "The first line of defense is always diplomacy," Kusnanto said.

Law for civilians not the same as for police, TNI

Jakarta Post - June 25, 2002

Novan Iman Santosa and Yogita Tahilramani, Jakarta -- This nation seems to have a huge stock of shocking legal violations. One ongoing case involves no less a figure than Comr. Gen. Sofjan Jacoeb, a former Jakarta Police chief.

Jacoeb is now under investigation for issuing temporary vehicle documents for 11 Mercedes Benz vehicles allegedly smuggled into Indonesia from Singapore.

Jacoeb, now an inspector at the National Resilience Institute, is alleged to have committed the crime during his term as chief of the South Sulawesi Police and after he became head of the Jakarta Police last year.

But whether justice will be served in this case is the question that concerns the public, and rightly so judging from earlier treatment accorded members of the Indonesian Military (TNI) and the National Police under the law.

A drug case involving the son of a former top Army officer serves as an example. Second Lt. Agus Isrok of the Army's Special Force (Kopassus) was arrested for the possession of drugs on August 8, 1999. A Jakarta Military Tribunal sentenced him on June 22, 2000, to four years in prison, as well as discharging him from the service.

Months later, the Jakarta Military High Court reduced the sentence to two years and reinstated Agus as an Army officer.

Agus' codefendant, Donny Hendrian, was sentenced to a nine-year jail term and was ordered to pay a fine of Rp 200 million by the West Jakarta District Court in April 2000.

Justice for military and police officers is one thing, and the discrepancies between the punishments for soldiers and civilians is another. Unlike Agus, an Army officer and the eldest son of former Army chief Gen. Subagyo Hadisiswoyo, Donny is a civilian.

Criminologist Adrianus Meliala said criminal cases involving military and police personnel were investigated by the Military Police, and then handed over to military prosecutors to try before a military tribunal. But they use the same Criminal Code for civilians, he said.

The discrepancies arise, according to Adrianus, because although the same Criminal Code is used for both civilians and the military, military tribunals tend to hand down much lighter sentences than civilian courts.

"Military tribunals cut military defendants some slack for serving the country as military officers," Adrianus told The Jakarta Post on Monday.

And in the military, he added, a criminal case does not necessarily have to be handed over to the Military Police, should the commanding officer decide, for example, that it could badly tarnish the image of the military. So cases can be closed after the soldier in question has received "internal punishment", such as physical punishment.

Referring to Jacoeb's case, Adrianus said that even though police personnel were subject to the Criminal Code, it ultimately depended on their superiors as to how their cases would be dealt with.

"A police chief could decide that a criminal case, once dealt with by internal affairs or even by police detectives, is finished and done with," he said.

"The officer in trouble may get reprimanded, suspended or even dishonorably discharged, but if a police chief decides that the case does not have any criminal content, it will never be forwarded to state prosecutors, as it would according to the new 2002 law on the police." What is ludicrous here, he said, is that police investigations of criminal cases involving police officers or officials are not overseen by an independent legal body or the Attorney General's Office.

"Sometimes, police officers are grilled by detectives, who are their colleagues or friends," Adrianus said.

Criminologist Harkristuti Harkrisnowo said the use of military tribunals should be limited. According to Law No. 31/1997, these tribunals should hear cases involving violations of regulations on military ethics and military discipline, such as desertion, insubordination or stealing and passing on confidential files to a foreign country.

"These tribunals should not include heavy cases like homicide, rape or drug trafficking. The use of the military tribunal should be limited. The heavier cases, legally speaking, should be tried in civilian courts," Harkristuti said.

No politics, says new Jakarta navy chief

Straits Times - June 25, 2002

Derwin Pereira, Jakarta -- As the army manoeuvred behind the scenes to return to a position of power in Indonesia, the navy slowly distanced itself from such attempts as its new commander made clear that it would not dabble in domestic politics.

Admiral Bernard Kent Sondakh told The Straits Times in an interview that the navy's profile would increase significantly in the next few years as it grappled with rising problems of piracy, protecting natural resources and securing the country's busy sea lanes. But politics was a no-go for the navy, he said.

"Our task is a very professional one," he maintained. "It is a military function to defend the sovereignty of Indonesia and not take part in day-to-day politics."

His comment flies in the face of ongoing developments in Indonesia where the army has been taking steps over the last year to preserve its political position.

Amid mounting controversy and what some critics see as a setback for democracy in the country, the Indonesian Armed Forces (TNI) declared last week that it wanted to remain in the legislature until 2009 to allow the military to 'consolidate internally'.

The original plan was to leave Parliament in 2004. The TNI was also contemplating allowing its members to vote and be elected.

According to a draft of the election Bill, officers could be elected in the provinces provided they obtained a permit from their superiors.

The Bill appears to have the backing of major parliamentary factions like President Megawati Sukarnoputri's Indonesian Democratic Party of Struggle (PDI-P) and Golkar -- parties seen to be veering towards the TNI for support ahead of the 2004 polls.

Admiral Sondakh did not comment on the latest moves by the TNI but said in jest that the media was always trying to draw the military into politics.

Noted the four-star general: "It's all you reporters trying to create the impression that we are intervening in politics." Analysts said Admiral Sondakh's comments were a broad reflection of sentiments in the navy and even in the air force.

Some officers have privately expressed reservations at the army continuing to call the shots four years after Mr Suharto's fall.

During the interview, the navy chief took pains to explain that the navy was trying hard to raise its profile as a professional outfit.

Moves were under way to revise the academic curriculum of naval cadets and officers attending courses at the staff and command college. The Indonesian navy was also intent on stepping up bilateral exercises with neighbouring countries like Singapore and Malaysia.

More importantly, he said the navy was seeking to upgrade its ships and equipment to handle a range of problems the country was facing from piracy and smuggling to potential conflicts that could arise in Indonesia's sea-lanes of communication.

The country's economic problems and budget constraints meant that there was a tight lid on the purchase of equipment now. He said that the navy was getting around the problem by "overhauling" several of the 113 ships in its operations. He said: "We are looking at ways to ensure that all our ships are in prime condition to handle whatever security threats we face."

International relations

Critics on warpath against US military aid to Jakarta

Asia Times - June 25, 2002

Tim Shorrock (Inter Press Service), Washington -- As US officials lobby Congress to approve a US$16 million package of military aid for Indonesia, they are stressing the need to support political stability in the world's largest Muslim nation while downplaying Jakarta's role in the global war against terrorism.

"Whether democracy succeeds or fails in Indonesia won't be a function of our reaction to the events of September 11," Matthew Daley, the deputy assistant secretary of state for East Asian and Pacific Affairs, said in a recent speech. "In dealing with Indonesia on counter-terrorism, if the focus is September 11, you're missing 90 percent of the story."

The George W Bush administration is seeking $8 million to train the Indonesian police in internal counter-terrorism tactics and another $8 million for a "peacekeeping headquarters" for the Indonesian military, known as TNI.

Jakarta "has to confront the threat of sectarian violence", Daley said. "We want to provide unequivocal support for the territorial integrity of Indonesia," he said at a forum on Indonesia sponsored by the Sasakawa Peace Foundation and the US-Indonesia Society.

The change in rhetoric represents a shift from the Bush administration's initial response to September 11, when it pressed Jakarta and other allies to join the war against the al- Qaeda network responsible for the hijack attacks on New York City and Washington.

Indonesian President Megawati Sukarnoputri was the first leader of a Muslim country to visit President Bush after the attacks and the two leaders used their meeting to restart high-level contacts between the Pentagon and the TNI. Bush also lifted a US ban on the sale of non-lethal commercial arms to Jakarta.

In the weeks after September 11, US officials warned that Osama bin Laden's al-Qaeda network had infiltrated Indonesia, posing serious danger. "I think they are more dangerous to Indonesia than they are to the United States," Paul Wolfowitz, the deputy secretary of defense who once served as the US ambassador in Jakarta, told an Indonesian magazine last November.

US military aid and training for Indonesia was suspended in September 1999 in the aftermath of the rampage in East Timor by militia forces backed by the TNI. Later that year, Congress adopted the Leahy amendment linking the resumption of military aid to the prosecution of military personnel involved in the atrocities.

Since Megawati's visit to Washington, US-Indonesian military ties have grown closer. In April, US and Indonesian officials held talks on security issues, followed in May by a visit to Jakarta by Defense Secretary Donald Rumsfeld, who said that a quick resumption of military ties between Washington and Jakarta would bolster the war against terrorism.

"I think it is unfortunate that the United States does not today have military-to-military relationships with Indonesia," he told reporters.

But many in Congress continue to believe that Indonesia has not fulfilled its promises to reform the military. And on the issue of East Timor, the State Department itself is unsatisfied with Indonesia's attempt to prosecute generals responsible for the 1999 violence. "I cannot tell you that we're encouraged by the progress to date," said Daley.

One factor in the US decision to stress Indonesian issues over global terrorism is the potential backlash from Indonesian Muslims toward US policy in the Middle East, particularly Washington's "uncompromising support for Israel", said Meidyatama Suryodiningrat, the managing editor of the Jakarta Post.

"The perception remains that Muslims are being victimized" by US policy, Suryodiningrat said. He noted that radical Islamic parties will contend for power in the 2004 national elections in Indonesia. If the economic situation doesn't improve, more young Indonesians could be "attracted to radical ideologies", he said. "There is a potential for radical Islamic movements to become popular."

Suryodiningrat said a resumption of US military ties could lead to reforms within the TNI. "But if it's focused narrowly on terrorism, it will do more harm than good," he said.

The aid the Bush administration is seeking will better prepare the TNI to deal with domestic disturbances and civil unrest, argued Daley. "We're trying to expand the margins of what we can do with the TNI." The United States should be "realistic" and recognize that Indonesia must resort to using its military rather than police to deal with internal problems -- a situation "not unfamiliar" to US leaders, he said.

The $16 million would allow Indonesian forces to be "trained in ways to deal with problems without recourse to discriminate violence in units under command and control", he added.

"If approved by Congress, the money won't go to tactical units themselves to buy bayonets, stun guns, electronic prods and that kind of thing, but for command and control, mobilization and training. This doesn't amount by any stretch of the imagination to a broad resumption of a long-term military relationship. That requires more progress" in military reform, Daley said.

But Sidney Jones, the Jakarta representative of the International Crisis Group, said it is far too early to resume direct military aid to the TNI. The $16 million package requested by the Bush administration "sends a very wrong signal about the Indonesian TNI involvement with internal security", she said. The Leahy amendment, Jones said, "is our only source of pressure on the Indonesian government".

A recent International Crisis Group paper on Indonesia states: "Better military training will not alter the fact that there is a fundamental lack of political will on the part of Indonesian national civilian and military authorities to exert control over private armies, punish abusive soldiers, end military corruption or proceed with long-promised reforms."

Economy & investment

Government told to immediately improve investment climate

Jakarta Post - June 29, 2002

Dadan Wijaksana, Jakarta -- The latest data showing a precipitous drop in foreign direct investment (FDI) should serve as a wake-up call for the government to quickly take action to improve the country's investment climate, analysts said.

Analysts said the government had so far failed to learn the lessons from the past and seemed wholly unable to realize how serious the impact of the FDI drop was on the country's economy.

"The [FDI] data should serve as a wake-up call for the government to realize how serious the problems are. Because, aside from exports, investment could accelerate our economic growth, as we cannot keep relying forever on strong consumption," University of Gadjah Mada economist Sri Adiningsih told The Jakarta Post on Friday.

Sri warned the government that without sufficient economic growth, the huge number of unemployed -- current figures put the number at over 40 million -- caused by the 1998 economic crisis could not be absorbed, which in turn would trigger a serious social backlash.

"That's why we need to have our exports and investments growing by at least 10 percent per year if we are to have at least 5 percent economic growth, the minimum level of growth needed to absorb new job seekers," she added.

She also urged the government to stop wasting time by engaging in a public war of words blaming each other for the country's various problems, as this would push investment away even further.

She was referring to, among other things, the recent controversy within the government whether to continue to accept International Monetary Fund (IMF) loans to assist and improve the country's economic reform programs.

The Investment Coordinating Board (BKPM) announced Thursday that FDI approval during the first five months of the year fell by 59 percent to US$1.67 billion, compared to $3.98 billion in the same period last year, due mostly to the unfavorable business climate.

All this comes at a time when the country's macroeconomic picture seems to be improving, particularly with a declining interest rate, stronger exchange rate of the rupiah and a declining trend in inflation.

FDI approvals, however, have been steadily declining since the country was badly hit by the financial crisis in the late 1990s, because of various problems that have turned investors away from the country including security disturbances, economic and political instability, corrupt court system, labor disputes and confusion over regional autonomy.

The government's failure to address these problems has only turned things from bad to worse, prompting not only the reluctance on the part of foreigners to invest but also creating jitters among domestic investors.

Chairman of the National Economic Recovery Committee (KPEN) Sofjan Wanandi claimed the current administration's impotence and inability to find any solutions would only make the problems worse until a new team of economists could be named after the next election in 2004.

"In the next two years, with the absence of strong leadership, real investments will not be coming in," Sofjan. Investors who were already doing business here have gradually left the country, he added, and no new ones were coming.

Anton Supit, chairman of the Indonesian Footwear Association (Aprisindo), also said the level of investor confidence was so low that several foreign shoe manufacturers had been shutting down their operations here and were moving to neighboring countries, leaving tens of thousands of local workers in the lurch.

"Several shoe makers have closed their companies one by one. With one factory managing to absorb an average of 6,000 workers, this only creates more bad news," he said.

Economist Pande Radja Silalahi agreed that failing to address this situation immediately would make the problems accumulate, making them even harder to fix.

"....This is serious. This could cause huge unemployment, which is a big problem for all of us. The government has no choice but to improve the business environment quickly," Pande said.

Among other things that needed to be addressed, he added, were major reforms in the legal system, less labor disputes and clearer regulations surrounding the regional autonomy, all those should be the government's priorities.