Democratic struggle

PRD launches forum for reformers

Jakarta Post - July 12, 2002

Jakarta -- The Democratic People's Party (PRD) launched on Thursday the Democracy Front to unite like-minded reformers within a forum in a bid to revive the country's original reform movement.

PRD secretary-general Natalia Scholastika said the Democracy Front could prove to become a viable opposition force to the government and the legislature.

Asked what the forum would stand for, she said "first as a savior of the people's sovereignty, then as the savior of the people's political and economic agenda, and last as [a means] to overthrow the Megawati-Hamzah Haz government." She said toppling the government was easy, however this was just the first step toward changing the system with which the government was working under.

"The final target of the Democratic Front is to introduce this nation to a new system of government, a new economic and political concept," she said.

She said the front would hold a conference sometime later this month to hammer out the details of its goals and how it would achieve them. Anyone who is basically anti-President Megawati Soekarnoputri is invited to join, she said, adding that they wanted the forum to be informal.

Thursday's launch of the front followed a discussion on the fate of Indonesia's reform movement. Discussion participants included former president Abdurrahman Wahid, labor activist Dita Indah Sari and foreign expert on Indonesia Jeffrey Winters.

Dita supported the idea of the Democracy Front becoming a common platform, and called Megawati's presidency a disappointment to the people.

Appearing hesitant to back the front was Abdurrahman, who noted that it could lead to a revolution of which nobody understood its objective yet. "We should first come together and discuss what we mean by a revolution," he said.

Wahid, Sari call for `people's congress'

Green Left Weekly - July 10, 2002

Max Lane, Jakarta -- On June 25, the Jakarta Media Centre was packed to overflowing. Former Indonesian president Abdurrahman Wahid (Gus Dur) and Dita Sari, the most prominent labour movement figure in Indonesia, were going to speak on the same platform.

Representatives of Megawati's Indonesian Democratic Party of Struggle (PDIP) and Vice-President Hamzah Haz's United Development Party (PPP) were also invited, but expectations were low that they would attend.

Judhilherry Rustam, representing the Vigilance Against the New Order Committee, a watchdog group on corruption and abuse of power, was also on the panel. I had also been invited to speak as an academic observer of Indonesia and a sympathiser of the democratic movement in Indonesia.

Wahid's speech was a combination of criticisms of basic government policy together with factional attacks, sometimes quite bitter, on his rivals within the political elite -- Megawati and Hamzah Haz in particular.

The next day, Rakyat Merdeka, a daily paper with a mass circulation among Jakarta's urban poor and workers, carried the front-page headline, "Gus Dur gives a report card". The paper's report summarised Wahid's criticisms of the Megawati government in point form: - Corruption and collusion have continued under Megawati's presidency.

• The state-owned enterprises have been turned into milch cows for the political elite.
• The livelihood of the people has been taken from them.
• Many state assets have been let slip away into private hands.
• The government is subservient to the dictates of the IMF, World Bank and the US.
• The government prioritises the interests of the big corporations.
• The parliament has become a place where votes are bought and sold.
• The parliament has acted unconstitutionally.

The article also reported Wahid's advocacy of a five-year moratorium on all foreign debt repayments so that the money could be used to fund improvements in the economic welfare of the common people.

Not surprisingly, these criticisms received strong support from the audience of mainly students, urban poor, political activists and journalists at the June 25 meeting. There was little disagreement either from the speakers that these were serious criticisms that needed to be made.

Dita Sari concretised some of these criticisms by raising the issues of returning price subsidies to basic goods and protecting local industries. She also emphasised that these criticisms indicated the Megawati government was not capable of dealing with the current economic and political crisis and that, therefore, it had to be replaced.

An interesting debate followed on how to achieve a new government. All speakers, including both Wahid and Sari, agreed that there should be both extra-parliamentary as well as parliamentary efforts to bring about a change of government. The differences centred on the potential mechanisms for advancing these efforts and ultimately, on what kind of government was needed.

I had gone to the meeting wanting to pass on my impressions of the situation during the month or so I had been in Indonesia. One of the most striking things was the emergence of new social protest movements in the 1990s.

New trade unions and peasant groups formed, the student movement grew and led the overthrow of General Suharto's military dictatorship, a feminist movement started to emerge and NGOs were formed. Central to this process also was the mushrooming of action committees on local issues.

Since the fall of Suharto and the opening up of more opportunities for public expression of dissent, scores more trade unions, peasants', women's, professional and other interest groups have been formed. Ad hoc action committees have emerged everywhere. I doubt whether there is an Indonesian anywhere who has not been involved in a street protest or who does not have friends who have.

There are scores, probably hundreds, of radical or at least critical, discussion groups, study groups and small publishers of radical literature. While the student movement lacks any common focus, students' interest in politics is deeper.

Part of the three-hour discussion at the June 25 meeting focused on how this extremely dispersed and leaderless process of politicisation and protest could be galvanised to provide a political alternative to the government of the political elite. One suggestion was the formation of a "people's congress" that could bring together all these elements to try to hammer out an alternative political and economic program.

Dita Sari immediately supported this suggestion. Wahid responded, at first, with a general statement that neither the Peoples Democratic Party (PRD), of which Sari is a leading member, nor his own National Awakening Party (PKB), could achieve political change on their own, and that they had to work together. However, when pressed by journalists at the press conference immediately after the debate, he stated his support for the people's congress proposal.

"This is a good proposal", he said. "But any steering committee or organising committee must be representative. That will be an issue." Later, another journalist asked what the possible timing would be for such a gathering. "To be frank", Wahid answered, "The PKB has made no preparations on this issue yet. We haven't even been able to get our internal problems fixed yet, let alone to prepare for external issues." Another journalist asked: "The people need something to happen, Gus Dur. Do they have to wait for the PKB to fix itself first?" To this Wahid replied: "I think Dita should work on this." Was Wahid trying to reduce his commitment to supporting such a congress by urging Dita Sari to take the first step? In any case, most of the mainstream media over the next couple of days carried articles with headlines like: "Gus Dur agrees to support pro-democracy congress" or "Gus Dur supports people's congress".

There is currently a discussion in the Indonesian parliament (MPR) over whether the country's next president should be elected directly or, as is the case now, by the MPR. The PKB supports direct elections, as do all the other parties except the PDIP. The military-police faction in the MPR also opposes direct elections. Wahid made it clear that he was willing to stand again as president and said he was already campaigning in the regions.

One frustration that I thought many people must feel with the presidential elections is that the law forbids anyone under the age of 40 from standing as a candidate. I raised this issue at the June 25 meeting, pointing out that it meant that Dita Sari could not stand as a presidential candidate.

In his criticisms of the Megawati government, Wahid attacked the government's prioritisation of the interests of the "black conglomerates" and international capital. He said that the enterprises of the "little people" -- the peddlers, the food stalls, etc. -- were suffering. He used the term "people's capitalism" to refer to the kind of socio-economic system that he seemed to prefer.

There was no time to debate this out, although one older member of the audience challenged the panel to state their preference for either capitalism or socialism. Dita Sari took this opportunity to restate the PRD's critique of the government's surrender to neo-liberal policies and to argue that the only way to ensure an alternative program in the interests of the poor was implemented was to struggle for socialism.

[Max Lane is a visiting fellow at the Centre for Asia Pacific Social Transformation Studies, University of Wollongong. Lane is also national chairperson of Action in Solidarity with Asia and the Pacific.]

Aceh/West Papua

Jakarta at crossroads on what to do about Aceh

Radio Austrlaia - July 11, 2002

The Indonesian Government is at a crossroads in its long running war with separatist rebels in its rebellious province of Aceh ... a conflict which has been dogging Jakarta for almost 30 years. Jakarta is considering whether it should continue floundering peace talks abroad with GAM, Aceh's separatist rebel group or whether it should cancel the talks and impose martial law. Indonesia's President Megawati Sukarnoputri appears to be favouring the military option but moderates in Jakarta say peace talks and a Special Autonomy Law for Aceh introduced last year should be given a chance to work first.

Presenter/Interviewer: Tricia Fitzgerald

Speakers: Amin Riamon, spokesperson for Indonesia's MInister for Political and Security Affairs; University of Tasmania, Doctor Lesley McCullock; Kaudsar from the Aceh Popular Democratic Resistance Front,

Fitzgerald: As the death toll in Aceh continues to mount, so does the pressure on Jakarta to find a long-term solution. Indonesia's Co-ordinating Minister for Political and Security Affairs, Susilo Bambang Yudhoyono, is talking tough. He's in Aceh this week, holding talks with provincial officials on the continuing crisis. At stake is what Jakarta calls its comprehensive political, economic and military approach to the Aceh problem.

A spokesman for the Minister, Amin Riamon, says that multi- pronged approach is up for review.

Rioman: So this is the purpose of the visit by the Co-ordinating Minister for Political and Security Affairs to Aceh -- to evaluate the latest developments here; to ask the local Parliament and then the local government, the Chief of Police and then the TNI -- the military here. Whether we have to continue the comprehensive approach or we increase it into emergency law -- civil emergency law or marshal law.

Fitzgerald: The Security Minister says Aceh's rebels are terrorists and that peace talks should be shelved if they continue their attacks.

The rebels say they are acting in self defence against Jakarta's military campaign. They have admitted they did recently kidnap nine crewmen off a ship heading to Aceh's oil fields and a group of athletes, but have since released them.

Mr Bakhtiar, a spokesman for the GAM rebels, in Sweden, says labelling GAM as a terrorist organisation is a ploy by Jakarta to get international support.

Bakhtiar: They have called us terrorists and even fundamentalists but it never worked out because people know that we are not fundamentalists -- we are fighting not for a total Islamic state but it is for the preservation of our people as a nation.

Fitzgerald: Mr Bakhtiar says imposing a state of emergency will only escalate the conflict. He says the peace talks scheduled to take place in Geneva this month should go ahead.

Bakhtiar: We still uphold the Geneva Agreement of Joint Understanding signed between the two parties on May 10 -- last May -- and we look forward to continued talks for the conclusion of the ceasefire and the implementation of a ceasefire in the fields in Aceh.

Fitzgerald: The Indonesian Government is also making Aceh's acceptance of a special autonomy law it introduced for the province last year, a condition for the continuation of peace talks.

The law, allows for the introduction of Islamic Shariat law in Aceh, and promises the province a greater return on revenue from its oil and gas fields.

Doctor Lesley McCullock of the University of Tasmania says Jakarta is making a mistake, tying the resolution of the Aceh conflict to acceptance of the special autonomy package. She says the package has been flatly rejected by the Acehnese community.

McCullock: There wasn't an official referendum but there is a civil society taskforce in Aceh which is a consortium of around 50 NGO's and they put together a document that rejected the special autonomy package and also rejected the implementation of Shariat Law.

Fitzgerald: Not legally recognised in any other part of Indonesia, Shariat Law was introduced in Aceh four months ago, under the special autonomy package.

Doctor McCullock says, although the political elite in Aceh supported its introduction, most Acehnese never wanted it. She says many local people see it's introduction as an attempt by Jakarta to win Aceh's powerful islamic clergy.

McCullock: Shariat Law, it is true, was offered by Jakarta as a carrot, but immediately and quite vigorously rejected by Acehnese civil society. And the Islam that we see in Aceh -- and I spent quite a lot of time there -- is not a radical form of Islam, although the Acehnese society is a very pious Islamic society, but it is not radical Islam.

Fitzgerald: Aceh's Shariat Law forces women to wear the veil and allows for the establishment of a special police force. Already some civil groups say police are detaining women for not wearing the veil.

Mr Kaudsar of the pro-independence Aceh Popular Democratic Resistance Front says if Jakarta hoped to win over the hearts and minds of Acehnese by offering them Shariat Law -- it hasn't worked.

Kaudsar: The Acehnese don't need the Shariat Law because Shariat Law is not the basic demand for Aceh. What Acehnese want just independence or self-determination for independence.

Fitzgerald: The division of revenue from oil and gas fields, the other key part of Jakarta's autonomy package, is also proving problematic.

The Acehnese Civil Society Taskforce says funds which were supposed to be handed to back to the province under special autonomy, have not been paid because of a shortage of funds in Jakarta.

Aceh's Provincial government has expressed frustration over Jakarta's failure to stick to this aspect of the deal.

Indonesia's guerrilla war puts Exxon under siege

New York Times - July 14, 2002

Jane Perlez, Lhokseumawe -- The silvery pipes that extract hundreds of millions of dollars in natural gas a year for Exxon Mobil glint in the tropical sun here, a glittering contrast to the ramshackle huts and rice fields of the villagers nearby.

The disparity might spell trouble enough in an era of increasing sensitivity about the gap between the wealth of Western corporations and the foreign workers who labor for them.

But adding to the tension, this gas field, protected at its barbed-wire perimeter and well beyond by Indonesian soldiers, sits in the middle of a brutal conflict against separatist rebels here in Indonesia's northern province of Aceh (pronounced ah- chay). That leaves the company, the largest long-term foreign investor in Indonesia and one of the world's most profitable businesses, under siege.

Exxon Mobil is also the object of a lawsuit filed on behalf of villagers who accuse the company of turning a blind eye to brutality by Indonesian soldiers, who have a long history of human rights abuses and have been paid to provide the plant's security.

The company denies the charges. But the suit and Exxon Mobil's travails in Indonesia encapsulate the problems faced by big American companies that do business under the protection of ill- trained foreign armies in places where the United States has strategic interests.

Now, the Indonesian government is considering imposing a military emergency in Aceh, a move that could spell still more trouble for the plant and rankle Congress, where the Bush administration will be pushing soon to renew ties with the Indonesian Army.

Last year, attacks by the separatist guerrillas of the Free Aceh Movement, who argue that the gas revenues belong to the province, forced the plant to shut down for four months, the first closing of its kind for a company that prides itself on toughing it out.

Since the plant reopened a year ago, a beefed-up contingent of more than 3,000 Indonesian troops have patrolled much of the 50- by-10-mile swath of territory here, where the gas operations cut into fertile forest and sit alongside the simple plots of some of the world's poorest people.

At night, the executives sleep in shipping containers inside the plant, having been forced to abandon their ranch-style homes a few miles away.

Villagers are hostile. They say the presence of the oil and gas giant has brought them little but grief: no tangible improvement in their living standard, and the perpetual threat of violence from unwelcome Indonesian soldiers.

On the outskirts of the complex, where generations of fishermen have eked out a living, a 60-year-old villager named Abdullah waded knee-deep in murky water. "I used to own land here," he said with a shrug. "When they built the plant, we had to move. Now I pay rent."

The suit against the company was filed last July in the United States by a workers' rights group, the International Labor Rights Fund, based in Washington, on behalf of 11 villagers, and it is now coming to a critical juncture in the courts. It asserts that the villagers were victims of murder, torture and kidnapping by Indonesian soldiers paid to protect the plant.

The State Department is to deliver an opinion on August 5 on whether the suit interferes with the Bush administration's policy in Indonesia, the world's most populous Muslim country and an uneasy partner in its campaign against terror.

Lawyers for Exxon Mobil asked for the opinion, apparently in the expectation that an administration with a bent toward the energy industry would favor dismissing the suit.

The case has aroused fractious debate at the State Department, pitting officials who view Indonesia as an important nation that needs all the money it can get against those who say America should stand firm on human rights.

It is part of a rash of suits that have been brought under the Alien Tort Claims Act of 1789, which has been used by foreigners to sue corporations in the United States over charges of human rights abuses abroad.

In the Exxon Mobil case, the judge has said that the State Department's opinion will be nonbinding. But Exxon Mobil's interests and those of the Bush administration are likely to be one and the same, and in the past the department's view has clearly been taken into account.

Earlier this year, the State Department said that pursuit of a lawsuit against Rio Tinto, the international mining company, in Papua New Guinea, would harm American interests, and it was dismissed.

But in another case, this one against Unocal, the California- based oil and gas corporation, involving accusations of abuses committed by the government of Myanmar, formerly Burma, its partner in the development of a gas field, the State Department saw no conflict.

The gas field here, the biggest in the country, holds more than symbolic importance for both Indonesia and Exxon Mobil, which industry analysts say would be reluctant to relinquish the operation.

The field generates more than $1 billion a year for the government, industry analysts say. When Exxon Mobil shut down operations last year, a senior government minister, apparently angered over the loss of revenues, called the company "cowards."

During its heyday in the early 1990's, when the field was run by Mobil, it produced about one-quarter of the company's worldwide revenue. For the people of Aceh, who want independence, or at the very least a fair share of the natural gas revenues they send to the central Indonesian authorities, the gas production has been a vast disappointment since it first began in the mid-1970's.

Abdullah, the fisherman, summed up the feelings of many in the area, as he tilted his cap (emblazoned with the logo of the company that has supplanted him) toward the plant. "The poor are getting poorer," he said. "The rich are getting richer."

The fact that the plant employs about 800 local people as permanent staff members and 2,500 more as contract workers is small solace, critics say, for the permanent presence of the military. Unabashedly, villagers describe the Indonesian troops, who they say intrude, often brutally, in their daily lives, as "the Exxon Mobil army."

To bring the suffering home to the company's investors, an Acehnese woman, Cut Zahara Hamzah, addressed Exxon Mobil's annual shareholder's meeting in Dallas in May. "With the pretext of searching for the Free Aceh Movement guerrillas, who are fighting to free Aceh from Indonesia, they arrest, detain, torture and make to disappear innocent villagers," she said of the Indonesian troops.

Among educated Acehnese, hostility to the plant is also widespread. "I was born there, and grew up there, and even I really hate Exxon Mobil," said Yusuf Ismail Pase, a lawyer who heads the Aceh Environmental and Human Rights Defense Institute, a group financed in part by the United States Agency for International Development.

"I'm one of the victims because our land was bought by Mobil very cheaply," he said. "I don't remember the total amount my father got but I know people got nothing." In the suit, the identities of the villagers alleging abuses have been kept hidden for fear of reprisals, human rights experts said.

One woman, identified as Jane Doe, says that on December 2, 2000, shortly after hearing cross-fire, she went to a nearby rice field and found her husband dead.

"Three witnesses who were in the fields with my husband said that the soldiers from Unit 113, the Exxon soldiers, arrived in military vehicles and shot at the group of farmers who were working in the fields," she says in the suit. Lawyers for Exxon Mobil declined to answer questions about the case.

Ronald I. Wilson, the president and general manager of Exxon Mobil Indonesia Inc., the subsidiary that operates the plant and is 100 percent owned by Exxon Mobil, said the company "doesn't condone human rights violations anywhere in the world, including Indonesia. If troops did anything to violate human rights, we did not condone it and we're not party to it," he said.

A challenge in Aceh

The Guardian Unlimited - July 11, 2002

John Aglionby -- The Indonesian government currently finds itself at a major crossroads over its policy towards Aceh, the province on the northern tip of Sumatra where separatists have been waging an armed struggle for independence since 1976, driven on by decades of broken promises of greater autonomy from successive regimes in Jakarta.

On the surface the options are relatively simple. Plan A would be to cancel the intermittent negotiations, impose a formal state of emergency and let the armed forces (with the elite Kopassus special forces very much in the vanguard) do whatever is necessary to crush the Free Aceh Movement (Gam).

The alternative is to press ahead with more intensive talks while simultaneously maintaining security and rebuilding the shattered infrastructure, government institutions and economy in the resource-rich province.

The fact that the government even finds itself facing such a dilemma speaks volumes about the failure of previous policies to restore order in the restive region.

For the last 17 months Jakarta has theoretically been pursuing a six-point multi-pronged approach involving military, economic, social and cultural aspects to win over the hearts and minds of the 4 million Acehnese.

Practically speaking, however, the Acehnese have seen little change except the firmer imprint of the army's jackboot on their lives as the civilian administrators, both local and national, have shown virtually no inclination to tackle the thornier issues. Public trust of Jakarta is therefore at an all-time low.

Officials would refute this by saying the government granted the province special autonomy last year which should see it receive a much larger allocation of the area's enormous wealth (predominantly oil and gas) than has hitherto been the case.

But unlike in Papua, the secessionist-wracked province at the eastern end of the archipelago, the autonomy was imposed with virtually no consideration given to the Acehnese people's views on the form the legislation should take. So there is no sense of ownership or control among the Acehnese over the pace and direction events are taking.

Two positive things can be said about the military operation. It is infinitely better disciplined than the police's efforts to maintain the peace and it has certainly put GAM on the back foot and pushed it up into the jungle-covered mountainous interior.

But at what cost? A massive escalation in the number of people, particularly innocent civilians, killed and livelihoods destroyed.

Last year the death toll was about 1,500, and this year it is likely to significantly exceed that. And as for getting anywhere closer to a final resolution of the conflict: not a chance.

GAM is certainly not free of blame. It vehemently denies it is a terrorist organisation yet it has no compunction about kidnapping innocent people, destroying school buildings and terrorising civilians.

The separatists, whose leader, Hasan di Tiro, is based in Sweden, say their demand for independence is non-negotiable, especially in light of the last 12 months' events, while Indonesia's president, Megawati Sukarnoputri, refuses to budge on creating even a federal state, let alone allowing Aceh to follow East Timor's example and break away.

The international community is firmly on the government's side as far as the nation's territorial integrity is concerned but is openly apprehensive about the escalating death toll and overreliance on a military approach to resolving the conflict.

A senior American official even said yesterday that a ham-fisted and ill-thought out imposition of martial law could negatively affect military ties between Washington and Jakarta, something the Indonesians are desperate to avoid.

In other words, the world is not just watching and taking note but impressing upon ministers the need to keep the talks going. Hence the current dilemma. To be fair to the government it is not rushing into the decision but allowing a frank and open, perhaps too open, debate on the subject.

The army chief of staff, General Ryamizard Ryarcudu, has made it very clear he wants to go in with guns blazing; the interior minister (a retired three-star general) believes martial law is preferable to civilian emergency on account of the local politicians' incompetence, and the local assembly wants the status quo to continue.

The senior security minister, Susilo Bambang Yudhoyono (another retired three-star general), is currently on a week-long fact- finding tour of the region and is taking care not to express his opinions but wait to discuss the matter in cabinet.

Ms Megawati is the swinging voter. She is unquestionably close to the military, which is helping to prop up her majority in parliament; she is irate abut GAM's activities and is terrified of national disintegration. However, she is also aware that nine years of martial law in the 1990s under the dictator Suharto achieved nothing except deepening the mistrust and hatred of Jakarta by the Acehnese.

It is by no means certain which way she will jump but whatever she decides it will be a significant indication of how she intends to run the country until the 2004 general election.

Indonesia to probe Aceh negotiator

CNN - July 12, 2002

Atika Shubertm Jakarta -- In another sign of Indonesia's crackdown in the restive province of Aceh, Chief Security Minister Bambang Yudhoyono will investigate suggestions the region's peace talks negotiator is not impartial.

Yudhoyono, on a week-long trip to the rebellious province, was quoted by state news agency Antara as saying there were suggestions the Henry Dunant Centre (HDC) for Humanitarian Dialogue was taking the side of separatists.

The Geneva-based center has facilitated a series of dialogs between the government and Free Aceh Movement (GAM) rebels.

Yudhoyono said the mediator was always trying to clarify or justify what GAM had done following clashes between security forces and rebels.

The result of Yudhoyono's trip will be key to new policies Jakarta is drawing up on Aceh.

After Indonesian President Megawati Sukarnoputri issued an order to take "firm action" last week, Yudhoyono threatened to declare a "state of emergency" which would effectively place the province under martial law.

The latest round of talks in May succeeded in getting both sides to declare a cease-fire and commit to an autonomy package as a starting point for negotiations. The cease-fire has been repeatedly broken, however, with violations on both sides.

The Free Aceh Movement also refuses to give up its stated claim of independence from Indonesia.

Indonesia has repeatedly warned that it will take a tougher stand against separatist rebels of the Free Aceh Movement as peace talks have unraveled amid escalating violence.

Human rights issues Rights groups and observers believe up to 600 people have been killed this year as a result of the conflict, blaming both the Free Aceh rebels as well as Indonesian police and military.

"There are a number of serious human rights violations that have been taken on the part of the rebels," said Sidney Jones from the International Crisis Group, currently researching a report on the conflict.

"At the same time, the military clearly feels that it has a green light to use all means necessary to ensure that the pushback continues. So we've seen very serious human rights violations on the part of the military, as well."

Lawmakers and human rights groups have protested the imposition of a state of emergency saying it is too similar to the military's "operational command" of Aceh in the early 1990's. Thousands of civilians were killed in a military attempt to extinguish the separatist movement.

The international community is monitoring the conflict closely for any signs of a return to the Indonesian military's brutal history in Aceh.

A senior US official said on Wednesday that the resumption of US-Indonesia military ties, broken off after Indonesia's military-led campaign of violence in East Timor, could be aversely affected by new alleged military abuses in Aceh.

Aceh lawmakers warn against state of emergency

Jakarta Post - July 11, 2002

Jakarta -- Aceh councillors warned the central government on Wednesday against imposing either a civil emergency or martial law in the province, arguing that the move would only worsen the security situation there.

In a meeting with Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono, they also urged Jakarta to fulfill its previous promises.

"We warn [the central government] that the imposition of either a civil emergency or martial law will only worsen the situation," councillor Said Muchsin said after a closed-door meeting with Susilo in Banda Aceh on Wednesday, Antara reported.

Susilo arrived in Banda Aceh on Tuesday to evaluate the situation in the troubled province to decide whether to impose either a civil emergency or martial law there.

Such a plan, however, has received strong objections from all quarters in Aceh society, the latest being Aceh lawmakers.

"The imposition of a state of emergency may cause the Free Aceh Movement to go out of control triggering anarchy," Said told Susilo, who was accompanied by Minister of Home Affairs Hari Sabarno, and National Intelligence Agency (BIN) chief A.M. Hendropriyono.

The administration of President Megawati Soekarnoputri is considering imposing a state of emergency in the country's westernmost province as security conditions there have worsened due to increasing armed contacts between government troops and members of the Free Aceh Movement (GAM).

Seven GAM members, including one female fighter locally known as Inoeng Balee, were killed on Wednesday when the military raided a GAM base in Tepuk Tulu village, Simpang Ulim, North Aceh regency.

At least 10 people, including one baby and a mother, were killed in gunfights between the military and GAM on Sunday and Monday. GAM members killed Lhoksukon military chief Captain Khairul Akpa on June 30.

Acehnese councillors, according to Said, told Susilo that they did not want the central government to impose either a civil emergency or martial law in Aceh to avoid more bloodshed. "There should be no more bloodshed in Aceh," he said, adding that the government should fulfill its previous promises.

The government promised earlier to bring to justice military personnel responsible for human rights violations when the province was placed under a military operation from 1989 to 1998, but until now the government has yet to make good on its promise.

Susilo maintained however that the government has engaged in dialog efforts but the bloody violence continues unabated. "Any armed secessionist movement should be put to an end," Susilo was quoted by Antara as saying.

In Jakarta, activist Rosita S. Noer said that security approach would not solve the problem in Aceh as it would only encourage the local people to support GAM. She emphasized that any separatist movement could only be ended through dialog and law enforcement, not by imposing a state of emergency.

"Dialog has been going on the right track in the past three years but it has to be followed through with law enforcement and the government has to keep its promises for Aceh," Rosita told The Jakarta Post.

Rosita, who once was a member of a fact-finding team for human rights abuses in Aceh, suspected that the large revenue from oil and gas in the province may had been the reason for the plan to impose a state of civil emergency. "Six trillion rupiah per year is sure a lot of money and may have been a reason to take steps to control such a huge amount of money," she remarked.

Meanwhile, a senior United States official warned on Wednesday that military operations in Aceh province could hinder the resumption of US military aid to Indonesia, cut off three years ago because of human rights abuses in East Timor.

Speaking on condition of anonymity, the official said that opponents of resuming aid would get a push if Indonesia opts for a military solution to the Aceh question.

"They [the opponents] will get the material to show that the Indonesian military does not get it," he was quoted by AP as saying.

Indonesia official warns Aceh rebels

Reuters - July 10, 2002

Jakarta -- Indonesia's chief security minister, on a fact-finding mission to Aceh province, said the government wanted to end a separatist war there peacefully but at the same time he issued a tough warning to the rebels.

Susilo Bambang Yudhoyono said hard-line elements in the Free Aceh Movement (GAM) would be crushed if necessary, the official Antara news agency reported on Wednesday.

In a reminder of the tension gripping Aceh, troops shot dead six GAM members including a woman rebel during a raid on Wednesday in the province's east, the military said.

Yudhoyono flew to Aceh on the northern tip of Sumatra island on Tuesday. The results of his week-long trip will be key to policies the government is drawing up on Aceh and which Yudhoyono has said could involve scrapping peace talks with the rebels and imposing martial law.

"We want to find a solution to Aceh which does not result in a waste of life. We hope this good intention elicits a sincere response from GAM," Antara quoted Yudhoyono as saying soon after he arrived in the province.

However, Yudhoyono said creating peace would take tougher security steps. He did not elaborate, but said if necessary, hard-line GAM elements would be crushed, Antara said.

The government expects to decide its stance early next month, and has won support from parliament for tough action but drawn criticism from human rights activists for its mounting rhetoric over GAM, which has been fighting for independence for 25 years.

Analysts have said a week of tough talk from the government -- including the public labeling of GAM as a terrorist group for the first time last Thursday -- showed Jakarta believed military action was the only solution to the conflict.

Army operations have been carried out regularly in the past year and clashes with rebels and other acts of violence linked to the war occur almost daily, often resulting in civilian deaths.

Two years of peace talks in Switzerland with the rebels have proven largely fruitless in stopping the bloodshed.

Many of Indonesia's political elite are still chastened by East Timor's decision to break away in a 1999 referendum, and are loathe to show leniency to rebels in Aceh, or Indonesia's other separatist hotspot, Papua province in the country's far east.

Rebels wounded

In Wednesday's raid, the military said it suffered no casualties and also wounded four rebels.

"Around 50 men from our squad raided a rebel stronghold this morning. In the operation, six armed separatists were shot dead," said Zainal Mutaqin, a military spokesman in Aceh. "One of the dead was a female fighter." A small number of women serve in GAM's armed wing.

Political analysts have said that by branding GAM a terrorist group, the government might try to link the fight against it to the international war on terror. The government has denied that.

No reliable death toll has been published for Aceh this year, but the International Crisis Group (ICG) think-tank said some 2,000 people were killed in 2001, most of them civilians.

Life a misery

Because of recent violence blamed on GAM, Yudhoyono said many people questioned the use of talks with the rebels.

He said any imposition of civil or military emergency was not the main objective of the government, whose primary focus was to halt a conflict that has made life a misery for Acehnese.

Activists expressed dismay at the government's hard line. "What we have here is [the government] fighting violence with violence and at the same time blaming the Aceh problem entirely on GAM," said Hendardi, director of the Indonesian Legal Aid and Human Rights Association.

Ibrahim Ambong, head of parliament's commission on defense and international affairs, backed a tough approach. "The commission is of the opinion that if dialogue has not given us results there should be firmer action in the form of a civil or military emergency," he said.

A military emergency, or martial law, would place the army commander in Aceh in charge of the province. Civil emergency is one step down, but still gives wide powers to local authorities. Aceh's people have long complained of abuses by GAM but their strongest criticism has been directed at the security forces.

Haz points to disgruntled generals

Laksamana.Net - July 10, 2002

Vice President Hamzah Haz has pointed a finger of blame at disgruntled generals who, he implied, have been destabilizing the restive province of Aceh by penetrating the Free Aceh Movement (GAM).

Amid the controversy concerning the government's plan to impose martial law in response to the continuing violence in Aceh, Haz has questioned who is the mastermind behind GAM.

"Is it true that the terrorist group belongs to GAM, or is it GAM with another added factor? We still do not know. Or, are there external parties who want Indonesia to be unstable?" said Hamzah Haz as quoted by Kompas.

Haz was opening what is likely to become a new debate on generals and mid-ranking officers who have served and established deep roots in Aceh from the days of the Suharto era.

Seen from the military track records of high-ranking officers, there are two former generals who served in Aceh and went on to become ministers. They are Lt. Gen. Syarwan Hamid, Minister for Home Affairs under President B.J. Habibie, and incumbent Minister of Communications Lt. Gen. Agum Gumelar.

Syarwan Hamid has a black record in Aceh, where he served as Military Resort Commander in Lhokseumawe, Korem o11 Lilawangsa, between 1991-1992.

Gumelar's connection with Aceh is less direct. In 1994 was assigned as Chief of Staff of the North Sumatra-based Bukit Barisan Military Command overseeing Aceh, under commander Arie Kumaat. Kumaat went on to head the State Intelligence Agency (BAKIN) under President Abdurrahman Wahid.

Since the end of authoritarian rule under Suharto, the crisis in Aceh has not necessarily been driven by GAM alone, but as a reflection of the proxy war among the generals. Under Suharto, military and intelligence operatives were given a carte blanc to put down the armed rebellion instigated by GAM.

Internal military tension had already surfaced, especially when then Armed Forces Commander General Benny Moerdani came into conflict with Suharto following the military's rejection of then State Secretary Sudharmono as vice president in 1988.

The bad relations between Suharto and Moerdani saw the latter work to bring his faction to prominence, taking over strategic positions at the center as well as at regional military command level.

The event that triggered the liquidation of Moerdani's faction was the 1991 Santa Cruz massacre in Dili, East Timor, which implicated Maj. Gen. Sintong Panjaitan and Col. Waraouw, two Moerdani protigis.

Then came the turn of Feisal Tanjung, assigned by Suharto as head of the Military Honorary Council investigating who was responsible for the Dili massacre.

The appointment signalled a power shift at central and regional military commands. Tanjung was appointed by Suharto as Army Chief of Staff in 1993.

The power shift was also reflected in Aceh. Then Col. Syarwan Hamid, close to Tanjung, was in charge in the troublespot of Lhokseumawe.

In 1990, a year before Syarwan took over the resort command, Suharto's son in law and another Moerdani rival, Prabowo Subianto, was assigned to Aceh as Kostrad (Strategic Reserve Command) unit commander.

This coincided with increasing tension, military oppression and a rise in the level of armed insurrection, allegedly provoked by dissatisfied regional military officers from behind the scenes.

The central military command in Jakarta launched an anti- narcotics campaign, the Nila Operation, in 1990, resulting in cleaning up at least 47 Aceh-based military officers who had got involved in the marijuana trade.

The story became interesting when authorities investigated one officer involved, Sgt. Robert Suryadarma from Battalion 111 based in East Aceh, one of the major troublespots. Suryadarma was found to be a follower of Rizal Gading, a rival faction of GAM supreme leader Hasan Tiro.

Rizal Gading in turn, is alleged to have had close ties to Benny Moerdani (see Geoffrey Robinson, Rawan is as Rawan Does, The Origins of Disorder in New Order Aceh, Indonesia Magazine). The crackdown in Aceh ran parallel to events at the center, where Suharto began to strengthen the Feisal Tanjung military faction in an effort to balance Moerdani's power.

From this arose speculation that Moerdani had been supporting certain disgruntled elements in the military linked to GAM in order to undermine the credibility and authority of its rival faction in handling the crisis in Aceh.

In response to the increasing armed strength of GAM supported by some military personnel, the military became more oppressive.

It was during Syarwan Hamid's tenure as Lhokseumawe-based commander that militarism hit a new peak in Aceh, involving not only military personnel but ordinary civilians.

As local commander, Syarwan introduced a strategy of civil- military cooperation -- a euphemism for compelling civilians to participate in intelligence and security operations against real or alleged government opponents. Syarwan thus militarized the civilian population.

"The youth are the front line. They know best who the GPK [Security Disrupting Movement] are. We will then settle the matter," said Syarwan [Kompas, July 11, 1991].

In its effort to isolate the armed insurgency by GAM, the military established the Military Operation Area (DOM) in three troublespots, Pidie, East Aceh and North Aceh. In these three areas, GAM was believed to have gained the sympathy of a fairly wide cross-section of the civilian non-combatant population.

The military became trapped in a process of state-sponsored terrorism, utilizing tools including rape, kidnapping, mass killing and torture to combat the civilian pro-GAM population.

The DOM was finally lifted during the Habibie presidency, but the military and GAM remained trapped in unending armed conflict.

Analysts say that during the military domination of Aceh under Suharto, military personnel in charge in Aceh mostly had backgrounds in intelligence and included veterans of special anti-terror units. "As they were mostly experts in counter terrorism, it was no great problem for them to act as terrorists," explains one.

Viewed in this light, Hamzah Haz seems to have good reason to question whether it is GAM and GAM alone which has been perpetrating terrorist acts.

As if to suggest a similarity between Aceh and the attack earlier this year on Soya village in Ambon, Haz has given the impression that the military is continuing to work behind the scenes to destabilize the regions. "As at Soya in Ambon, up to date we still do not know who is behind the ruthless mass killings. This is just one example," he said.

Baby shot, mother near death in latest Aceh violence

Jakarta Post - July 10, 2002

Jakarta -- A baby was shot and killed and its mother left fighting for her life in violence which claimed at least 10 lives in the war-ravaged Indonesian province of Aceh on Sunday and Monday, sources said.

The dead also include a soldier, two alleged Free Aceh Movement (GAM) separatists and a 79-year-old man and his son.

Maj. Zaenal Mutaqin, spokesman for the Iskandar Muda Military Command overseeing Aceh, said two rebels were killed in separate gun battles in North Aceh and East Aceh on Monday.

Razali, 30, an alleged member of GAM, was killed in the village of Cebrek, North Aceh. The soldiers who killed him seized a gun and ammunition from his house, he said.

Zaenal said another GAM member, identified as Abdullah, was killed during a clash with a group of patrolling soldiers in Tualang Cut, East Aceh.

Alamsyah, 30, was arrested for further investigation after he surrendered to the soldiers, he said.

GAM spokesman for East Aceh Ishak Daud denied the two were rebel soldiers, saying the local military had killed three civilians. "The soldiers killed not only Abdullah and Razali but also 22- year-old Kasem Ali. The three are civilians who have no relationship with GAM," he said.

He said the trio were killed as reprisal for GAM attacks on two military posts in the regencies of Simpang Ulim and Alue Baloh on Monday.

Jakarta may declare civil emergency in Aceh

Financial Times - July 9, 2002

Tom McCawley, Jakarta -- Susilo Bambang Yudhoyono, Indonesia's chief security minister, arrived in the troubled Aceh province on Tuesday as Jakarta considered declaring a civil emergency to end a 26-year war with separatists.

Mr Susilo flew to Banda Aceh, the province's capital, to assess conditions as officials in Jakarta showed signs they were losing patience with two years of peace talks.

Ibrahim Ambong, head of a parliamentary security commission, said: "We've given them all they want, special autonomy, more oil and gas revenue, special rules. If they still want independence there's no reason to tolerate them." Last week Mr Susilo asked parliament to recommend a civil emergency, labelling the main separatist group the Free Aceh Movement (GAM) as "terrorists".

A civil emergency would bring Aceh, Indonesia's westernmost province, closer to full martial law and allow the army to search houses and detain civilians.

Separatists such as the GAM have been fighting the Indonesian government since 1976, intensifying calls for independence and an Islamic state.

More than 3,000 people have died in the conflict since the authoritarian former president Suharto stepped down in 1998. Mr Suharto began a brutal, nine-year military operation in 1989 that he said would crush the rebels.

Last month rebels kidnapped and detained some 18 people, including nine workers on a boat chartered by ExxonMobil.

Ryamizard Ryacudu, army chief, told journalists in Jakarta: "Anyone with common sense can see that the kidnappings, burning and terror need tough military action." Perceptions of widespread human rights abuses by Indonesian soldiers have fed public demands for a referendum on independence.

Acehnese community groups have also complained Jakarta has siphoned off the province's mineral wealth and given little in return.

ExxonMobil Indonesia, a unit of the giant US energy company, operates the Arun LNG field in North Aceh, producing almost a fifth of total oil and gas exports.

Jakarta has tried to stave off separatist sentiment by offering Aceh's 4m people special administrative autonomy and up to 85 per cent of mineral revenue.

However, the conflict between Indonesian soldiers and rebel forces has continued, despite two years of peace talks in Geneva. The last round of talks was in May.

Acehnese leaders have rejected calls for the civil emergency. "Military solutions have been tried several times since 1976, and none have worked," said Ahman Farhan Hamid, an Acehnese member of parliament.

Acehnese human rights activists claimed a civil emergency would repeat Mr Suharto's military operation, and strengthen calls for independence. "A repressive approach will not only hurt combatants," said Ahmad Humam Hamid, of the human rights forum. "It will hurt civilians."

Commission probes Langsa massacre

Jakarta Post - July 8, 2002

Jakarta -- The National Commission on Human Rights has launched an investigation into last year's massacre of 31 residents in Langsa, Aceh, Antara reported on Saturday.

B.N. Marbun, a member of the commission, said the team arrived in Langsa on Thursday and will return to Jakarta on Monday.

Thirty-one plantation workers were killed when an unidentified group of armed men raided their company PT Bumi Floar in August 2001. Both the military and the Aceh Free Movement (GAM), which is fighting for an independent state, have disclaimed responsibility for the attack.

The investigating team has recruited local activists to help with the inquiry, Antara reported.

Military operation will only 'take toll on civilians'

Jakarta Post - July 8, 2002

Jakarta -- As the government continued to secure more support for its plan to intensify military operations in Aceh, experts warned that an increased military presence in Aceh would not solve problems but would only create state-sanctioned violence against innocent civilians there.

The latest endorsement of the government's harsh plan for Aceh came from the People's Consultative Assembly Speaker Amien Rais, who conveyed his support during his meeting with President Megawati Soekarnoputri on Thursday.

Amien said on Sunday that during his meeting with Megawati, he asked her to utilize two other alternatives available, and then resort to the military onslaught.

"In the meeting, I suggested three things, namely negotiation with GAM needs to be continued, and the autonomy law must be implemented fully," he said, adding that the security forces needed to take stern actions against trouble makers, be they thugs or GAM members.

"As for the military emergency, I think that's the last option, because those three options needed to be implemented first," he said.

Meanwhile, human rights activist Ori Rachman of the Commission for Missing Persons and Victims of Violence (Kontras) warned on Sunday that going back to another military operation could become just another ploy to terrorize the Acehnese.

He also warned that the government's new labeling of the Free Aceh Movement (GAM) as a "terrorist group" could backfire.

"Many actions by military and police officers in Aceh could very well be categorized as acts of terrorism because they put the people [civilians] in misery," Ori said.

In another hint that the government wants to crush GAM more than ever, Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono last Thursday labeled GAM as a terrorist group.

The next day, a group of Acehnese legislators rejected the new label, saying that GAM was just a group of Acehnese people who campaign for independence. They said such a label could lead to stigmatization, that could be used as a justification for the military to launch another military operation in Aceh.

Munir, one of the Kontras founders, also lamented the government's moves to revive the military approach, saying that it would only bring more casualties. He emphasized that the leaders, both military and political, had never learned the history of the cycle of conflict in Aceh.

Past rulers, from the Dutch colonial government to President Sukarno and President Soeharto had all adopted iron-fisted military approaches to deal with the desire for independence among the Acehnese, but none have ever extinguished it.

The transitional government of B.J. Habibie lifted the military operation imposed by his predecessor, Soeharto. The ensuing administration of Abdurrahman Wahid pursued a peaceful solution for Aceh by opening a dialog with GAM.

However, Abdurrahman later had to issue a presidential decree that gave the military another free hand to operate in Aceh. This decree was then extended by Megawati. The extended decree expires this month. Megawati is considering the adoption of a total military approach to end the conflict once and for all.

Riefqi Muna of the Research Institute for Democracy and Peace (RIDeP) was very disappointed by Megawati's fierce approach. "This is a setback in the effort to create a peaceful solution in Aceh," Riefqi told The Jakarta Post by phone.

According to Riefqi, the situation had shown the public of the government's inconsistency. Citing last month's peace talks in Geneva, Riefqi said that the government and GAM should have followed up on the peace dialog rather than launching military operations.

During the peace talks, both Jakarta and GAM agreed to fully execute Law No.18/2001 on Aceh's special autonomy as a starting point for further negotiations to find a peaceful solution. The autonomy law gives Aceh higher oil and gas revenues and the opportunity to implement Sharia law.

Four killed as fresh violence hits Aceh

Agence France Presse - July 8, 2002

Banda Aceh -- At least two civilians and two suspected guerillas were killed in the latest violence to hit Aceh, residents and the military said yesterday.

But in Jakarta, the authorities and parliament have not yet reached the conclusion that a state of emergency is needed in Aceh.

The Free Aceh Movement (GAM) has been fighting since 1976 for an independent state in the province. An estimated 10,000 people have been killed since then, 600 of them this year alone. Jakarta has branded the GAM as terrorists.

On Friday, residents in Kandang, North Aceh district, said two unidentified men on a motorcycle shot dead two youths at a roadside coffee stall.

Troops killed two suspected GAM members in a clash in Kampung Paya Biek in East Aceh district, also on Friday, Aceh military spokesman Major Zaenal Muttaqin said. Two AK rifles and ammunition were recovered, he added.

Meanwhile, Jakarta-appointed Aceh governor Abdullah Puteh pledged to prioritise dialogue to settle the conflict here as the central government appeared to harden its stance against the separatists in the resource-rich province.

"In the next 10 days, I will sit with the parliamentarians, the heads of the provincial police and military, with student leaders, non-governmental organisations and religious leaders to talk about it," he said, commenting on the possibility of the imposition of a state of emergency.

Meanwhile, in Jakarta, a leading parliamentarian said the lower house, the People's Representatives Council, had agreed to back "whatever strong stance" the military commander and the national police chief took to combat separatism in Aceh.

"We are all in agreement to exert pressure against separatism because it clearly disturbs the unitary state of the Republic of Indonesia," Mr Ibrahim Ambong, an MP from the Golkar party who heads the parliamentary commission on security, politics and foreign affairs, told the Antara news agency.

Rural issues

Drought causes 8.4 billion rupiah in losses in East Java

Jakarta Post - July 12, 2002

Yogita Tahilramani and Edith Hartanto, East Java -- This year's drought has dealt a severe blow to East Java province causing the country's major rice producing area to suffer losses to the tune of Rp 8.4 billion.

The loss has been caused mainly by a water shortage, ravaging hundreds of thousands of hectares of paddy fields and crops in 12 regencies.

Chief of the administration's information and communication division Suprawoto said on Wednesday that at least 4,440 hectares of paddy fields across the province had been hit by drought, and another 150,000 hectares of rice, corn and soybean fields may go absolutely dry.

East Java produces around two million tons of rice for the national stock every year. Some 65 percent of East Java's population of 35 million comprise of farmers, including fishermen, poultry farmers and, farmers who grow rice, soybean and corn.

Suprawoto said that the suffering of East Java's farmers could worsen if extra care was not taken, since this year alone some 6.5 million tons of rice had spoiled.

Farmers across the province, particularly those from severely-hit areas like Ngawi and Lamongan have rejected thousands of water pumps provided to them by the administration, stating that the fields had turned into "rock-hard ground".

The administration, however, continues to provide more pumps for drought-prone areas. Suprawoto said that the administration had no other choice.

It had initially thought of working in collaboration with the Agency for the Assessment and Application of Technology (BPPT) to seed clouds, he said.

But the plans were abandoned after BPPT said there was a 70 percent chance of failure, due to the lack of clouds and unfavorable climatic conditions.

"There is only a 30 percent chance of success to produce rain. That's just way too expensive considering that we would be spending Rp 700 million for each shot," Suprawoto told The Jakarta Post on Wednesday.

Conditions could worsen since the water level in several dams in East Java -- which are used to irrigate the paddy fields -- has dropped drastically due to the water shortage, be it from the rivers, ground water or even rain. "We're afraid that East Java will not be able to meet its rice production target this year due to the drought," Suprawoto said.

Up until May this year, East Java had only produced around 5.46 million tons of rice or around 62 percent of this year's target, which is about 8.83 million tons.

Lamongan, Ngawi and Nganjuk are the hardest hit regencies as the nearby reservoirs could no longer provide water, Suprawoto said.

Selorejo and Bening reservoirs near the town of Malang are among those with sharply diminishing water levels. The reduced water supply from the Selorejo reservoir will definitely affect Jombang and Kediri while similar conditions in Bening reservoir are bound to worsen the effect of the drought in Nganjuk area. Farmers could not do anything in those areas, except to watch their fields turn into plots of dried and cracked ground.

Aside from the prolonged dry season, East Java's water problems lie in the fact that the province receives little water from the Bengawan Solo river which stretches from Central Java to East Java. "East Java depends on the water supply from the Bengawan Solo, the water gate of which is located at Central Java's Gajah Mungkur reservoir and is controlled by Central Java officials.

"This year we got only 24 percent of water compared to 29 percent last year. This is a problem, because during the wet season they [Central Java officials] opened the water gate to avoid flooding in their area and let the water run through East Java severely flooding areas like Lamongan and Bojonegoro," Suprawoto said.

But when it is dry season, Central Java holds the water by closing the water gate, so East Java ends up with a severe water shortage, he said. "There's nothing much we can do about that. We can't depend on Central Java anymore in this situation. It's the same every year," Suprawoto said.

In a bid to cope with the problem, East Java will start distributing another 439 shallow water pumps this month to areas worst hit by water shortages. Each pump is expected to save around 15 hectares of paddy fields, of which one hectare of land can produce around 5.5 tons of husked rice.

"So 439 pumps can save around 6,000 hectares," he said, adding that some 718,000 hectares of paddy fields with irrigation facilities were not included in the water pump scheme.

Fertiliser shortage threatens rice production

Straits Times - July 11, 2002

Robert Go, Jakarta -- Indonesia's food-production targets could be hit this year because unscrupulous officials have allegedly been exporting fertiliser and reaping huge profits -- at the expense of farmers here, who desperately need the commodity for their own crops.

The practice has gone on for years, sources told The Straits Times, but officials have done little to stop it and ensure that Indonesian farmers receive adequate supplies.

Food production will become more crucial this year as a severe drought has hit several rice-growing regions, resulting in water shortage and devastated crops.

The government had previously projected that the rice harvest this year would reach over 51 million tonnes. But officials at the State Logistics Agency (Bulog) admitted recently that environmental factors and the lack of fertiliser could see a total yield of only 48.5 million tonnes.

"Farmers are already in bad shape. There is drought and lack of water, fertiliser problems, difficulty in getting good seeds ... Unfortunately the government still cannot focus enough on addressing these serious issues," said Mr H.S. Dillion, an agriculture specialist and former government adviser on poverty issues. "This could result in greater poverty and all the social problems which that brings."

Farmers have staged several protests in recent months against what they see as government inaction in the face of their troubles.

Any shortfall in rice production will not only hit the income of farmers but could also affect the poor -- reducing their access to affordable staple food products -- and could trigger social unrest.

Agriculture experts said Indonesia might be forced to import 2.5 million tonnes of rice this year to avoid wide-scale shortage. That figure is much higher than the 1.5 million tonnes that Jakarta imported last year to meet demand.

On paper, Indonesia's six state-owned fertiliser plants produce 6.5 million tonnes of fertiliser each year, more than enough to meet the 4.5-million-tonne domestic demand. Government regulations require that this be sold at subsidised prices to farmers first. Firms are only allowed to export leftover supplies.

But a Jakarta-based trader said that he has been able to buy fertiliser freely from state-run distribution centres and export the product to a number of South-east Asian countries. "I heard there is a ban on exports. But producers make more profit by exporting and earning US dollars," he said.

When contacted, Mr Ato Suprapto, a director-general at the Agriculture Ministry, said yesterday: "We have already told producers to distribute extra amounts to areas experiencing scarcity. We stopped exports already. Distributors know they have to meet local demands. This year's shortage was not the result of illegal exports, but rather of technical problems at several fertiliser plants."

When asked to explain how exporting agents could still buy easily from official distributors, he claimed that his ministry does not monitor the trade: "Ask the Industry and Trade Ministry for info on that."

Officials at the Industry and Trade Ministry and at PT Pusri, the holding firm that manages Indonesia's fertiliser plants, declined to be interviewed.

'War on terrorism'

Military denies al Qaeda presence in restive Aceh

Jakarta Post - July 11, 2002

Jakarta -- The Indonesian Military (TNI) denied on Wednesday that al Qaeda, the terrorist network led by Osama bin Laden, had a presence in war-torn Aceh.

A senior officer from TNI's Intelligence Board (Bais) told The Jakarta Post that Bais had checked out Aceh after it received information from the Philippine intelligence agency on the terrorist network's possible move to the province. However, there was no indication as yet that the bin Laden-led terrorist organization had been present there.

"We received the information a long time ago but after a check in the field, there was no indication that al Qaeda had moved operations to Aceh," he said.

The senior military official made the statement in response to American-based CNN's report on Wednesday that bin Laden had planned as far back as 2000 to move his al-Qaeda terrorist cells to Aceh from Afghanistan.

Maj. Gen. M. Djali Jusuf, chief of the Iskandar Muda Military Command overseeing Aceh, admitted that the situation in the province had been deteriorating because of foreign interference in the conflict but said so far, al Qaeda was not involved in the conflict.

He however, admitted that he received information that a senior aide of bin Laden visited the province last year but the visit was not followed by the terrorist network's presence in the province.

CNN said Ayamane al-Zawahri, bin Laden's senior aide, visited Aceh with al-Qaeda's former military chief Mohammed Atef in June 2000.

The Free Aceh Movement (GAM) has been fighting for an independent state in Indonesia's westernmost province since 1976 and the Acehnese people have been yearning for complete independence for centuries.

"Both of them [al-Qaeda leaders] were impressed by the lack of security, the support and extent of the Muslim population," said CNN. "This was part of a wide strategy of shifting the base of Osama bin Laden's terrorist operations from the subcontinent to Southeast Asia," the report added.

Al-Qaeda, which is blamed for the September 11 attacks in the US, had its bases in Afghanistan destroyed when the US began its war against terrorism last October.

More than 10,000 people have been killed since the 1970s in Aceh. The government is considering imposing a state of emergency, or even martial law in the province, which has huge oil and gas reserves and is situated at the entrance to the Straits of Malacca, one of the world's busiest sea lanes.

In other developments, at least 13 people, including two young children, were killed in separate clashes between the local military and suspected GAM members on Tuesday and Wednesday.

Zaenal Muttaqin, a spokesman for TNI in Aceh, said the military shot dead seven rebels when it launched a raid on GAM's stronghold in Seunebok Tuha Village in Simpang Ulim Subdistrict, East Aceh, on Wednesday.

He said the raid was launched early on Wednesday after gaining information from a rebel arrested by the local military. He added that the soldiers also seized a number of guns and ammunition from the rebels.

The seven were not identified but the military claimed that they were all members of the separatist movement. Ishak Daud, spokesman for GAM, denied the military's statement, saying three rebels and several soldiers were killed in the clash.

"The GAM members killed were Rasyidin Abubakar, Nurdin Yassin and Azhari Yusuf," he said, adding that the TNI soldiers also shot dead one woman and two young girls identified as Radiah Ali, 45, Nurlena Achmad, 15, and Yusnidar, 13.

Lt. Col. Muh. Nakir, chief of the TNI's East Aceh Military Subdistrict, said one rebel, three civilians and two children were killed in a separate assault on a GAM hideout in Idi Rayeuk on Tuesday. Dozens of other civilians were rushed to a nearby hospital with serious injuries, he said.

Nakir said the assault was launched after receiving information that indicated the whereabouts of the location of the hideout. He claimed the civilians were killed by two grenades thrown by the rebels near during the clash.

Rebels Reject CNN report as propaganda

Laksamana.Net - July 10, 2002

The Free Aceh Movement (GAM) has denied a report that claims it was in cahoots with Osama bin Laden's Al-Qaeda terrorist network.

A spokesman for GAM's exiled leaders in Sweden, Zaini Abdullah, on Wednesday told Japan's Kyodo News the source of the report presumably came from the Indonesian government, which wants to discredit the separatist group.

"We know nothing about Al-Qaeda and we have never had any contact with Al-Qaeda because GAM is not fighting for an Islamic state but for independence," he said.

He was referring to a CNN news item that cited an intelligence report revealing that bin Laden wanted to relocate Al-Qaeda's main base from Afghanistan to Aceh in 2000.

"That was a fake report made by the Indonesian government as a [form of] propaganda to label us as a terrorist group," said Abdullah.

The CNN report said an Indonesian man, Agus Dwikarna, had guided Al-Qaeda members during a visit to Aceh in 2000. Dwikarna, who was arrested with two other Indonesians in the Philippines in March for alleged possession of explosives, has claimed intelligence agents in Jakarta framed him.

The CNN report cited an Indonesian police document stating that Dwikarna had been plotting with militants to assassinate President Megawati Sukarnoputri but later dropped the plan.

There have never been any top-level political assassinations in Indonesia, not counting leaders of rebel groups, murders of generals and state-sponsored executions.

Intelligence report: Bin Laden sought Indonesian base

CNN - July 9, 2002

Maria Ressa, Manila -- Intelligence officials tell CNN that Osama bin Laden wanted to move the base of operations for his al Qaeda terrorist network from Afghanistan to Southeast Asia in 2000.

The plan, according to these officials' intelligence report, was to move the base to Aceh in Indonesia, where members of the Free Aceh movement (or GAM) were working with al Qaeda.

Aceh is a remote Muslim province in which rebels have fought for a separate Islamic state for decades. Bin Laden's No. 2, Egyptian Ayman Al-Zawahiri visited Aceh with al Qaeda's former military chief, Mohammed Atef, in June 2000.

"Both of them were impressed by the lack of security, the support and extent of Muslim population," reads the intelligence report made available to CNN. "This visit was part of a wider strategy of shifting the base of Osama bin Laden's terrorist operations from the subcontinent to Southeast Asia."

Al-Zawahiri and Atef were accompanied by two men now in custody: Kuwaiti Omar al-Faruq and Indonesian Agus Dwikarna. Asian intelligence sources tell CNN that al-Faruq was al Qaeda's senior representative in Southeast Asia.

United States sources confirm that al-Faruq was arrested by Indonesian authorities on June 5 and now is at Guantanamo Bay in Cuba.

US and Asian sources say al-Faruq's name and telephone number were found in a phonebook recovered in Pakistan during the arrest of former al Qaeda operations chief Abu Zubayda.

Who knew what, and when?

That same phone number, according to Philippine intelligence sources, was found in the mobile phone of Dwikarna, who guided the al Qaeda members during their visit to Aceh. Dwikarna was arrested in the Philippines in March.

"We have found out for sure that Agus Dwikarna has direct links to al Qaeda," Andrea Domingo, the Philippines Commissioner of Immigration tells CNN.

"The most important thing is to view this as an international organization that has a lot of resources up to now and that is still alive and operating at very different levels." An Indonesian police document obtained by CNN says Dwikarna was working with militants who plotted to assassinate Indonesia's President Megawati Sukarnoputri -- a plan that was later aborted.

Counterterrorist experts say bin Laden was looking for a place to which to move his operations as long as five years ago, and that in 1997 he sent a delegation to Yemen. As in Indonesia, nothing came of that visit.

But for investigators, details of the Aceh visit might help unravel the terrorist network left behind.

Government & politics

PDI-P: A few true believers

Laksamana.Net - July 11, 2002

President Megawati Sukarnoputri's Indonesian Democratic Party of Struggle (PDI-P) could split apart following parliament's decision not to investigate House of Representatives Speaker Akbar Tanjung's role in a multimillion dollar scandal.

The party's support for a second term for Jakarta Governor Sutiyoso has also caused dissent within the party while another gubernurial race -- in which the party is likely to back Maj. Gen. Sudrajat as Governor of Bandung -- is also creating friction.

At least one PDI-P legislator has already resigned, while another says disillusioned members could form a splinter party.

Indira Damayanti Sugondo sent her letter of resignation to Megawati on July 1 -- the day parliament voted overwhelmingly not to form an inquiry into the Tanjung graft case.

Of PDI-P's 153 legislators, only five voted in favor of the inquiry, while three voted against it, and 92 abstained. Those in favor of the inquiry were Sugondo, Mochtar Buchori, Haryanto Taslam, Julius Usman and Meliono Suwondo.

Suwondo said Wednesday that disappointed PDI-P members might form a rival party. "It is possible that rumors about the formation of a PDIP-Reform or Revolutionary PDIP will come into being as a concrete reaction of the disappointed members, whose numbers are increasing," he was quoted as saying by state news agency Antara.

He said a small group of PDI-P members, including Buchori and Usman, recently formed a "communication forum" at a meeting in Bogor, West Java, to discuss the party's failure to combat corruption.

Suwondo said PDI-P's stance on the Tanjung case could tarnish the party's image and prevent it from winning the 2004 general election.

Several PDI-P members have also been disgusted by Megawati's decision to support Jakarta Governor Sutiyoso for a second term in office. Sutiyoso was chief of the city's military command when state troops and hired thugs attacked Megawati's party headquarters on July 27, 1996, sparking deadly riots.

About 400 PDI-P supporters rallied in Jakarta on Tuesday to condemn Megawati's support of Sutiyoso. Grouped in the so-called July 27 1996 Harmony Communication Forum, the protesters said PDI-P was no longer a democratic party of the people, but had become an organization of business people who exploit the party's cadres, members and supporters.

"PDI-P, which has claimed to be the pioneer of democracy, has actually moved backward in terms of its vision, mission and struggle, especially in terms of the election of the Jakarta governor," said forum coordinator Thomas Resmol. He lamented that the perpetrators of the July 27 incident are still yet to be dealt with appropriately.

The backing for Maj. Gen. Sudrajat, now director general of defense strategy at the Department of Defense, reported to be coming from Megawati's husband Taufik Kiemas, has upset party faithful and students in Bandung, capital of West Java province.

Opponents to the move are not objecting to Sudrajat in person, but over the continuing support of the party for military involvement in politics.

In Jakarta, dissent over the support for Sutiyoso has permeated the city council, where a number of councillors defied the party's central board Monday and rejected the nomination. City chapter chairman Tarmidi Suhardjo said he still planned to run for election, The Jakarta Post reported.

PDI-P deputy chairman Roy B. B. Janis is the only one of a number of party candidates for the post who has withdrawn in line with the central board decision.

House slammed over selection of rights commission members

Jakarta Post - July 11, 2002

Fabiola Desy Unidjaja and Tertiani ZB Simanjuntak, Jakarta -- Human rights activists have accused the House of Representatives of making political deals during the selection of members of the National Commission on Human Rights (Komnas HAM).

The selections have raised fresh fears that only the perpetrators of human rights violations will be protected.

Ifdhal Kasim, from the Institute for Policy Research and Advocacy (Elsam), said many of the newly elected members had neither the integrity nor the credibility to unravel rights abuses blamed on the Indonesian Military (TNI).

"The rights commission may turn into a more useless commission as some of the new members have bad track records in the investigation on rights abuses allegedly committed by the TNI in numerous regions in the past," he told The Jakarta Post on Wednesday.

On Monday, the House of Representatives' Commission II on legal affairs picked 23 of 41 candidates proposed by an independent team to sit on the rights commission. The 1999 Law on the rights commission orders the House select 35 members.

Most of those selected are either little known or doubtful as they failed to deliver their mission and vision before the House's commission II which conducted the fit and proper test.

Hugely experienced and respected candidates, such as the coordinator of the Foundation of the Center for the Study of Human Rights (Yapusham), Todung Mulya Lubis, and humanist and agricultural expert H.S. Dillion, lost their places on the commission.

Many people believe that the two were scrapped because of their involvement in the Komnas HAM fact-finding team investigating the violence surrounding East Timor's vote for independence in 1999. The team listed a number of military officials who are currently being tried at the ad hoc Human Rights Tribunal in Jakarta.

Ifdhal said the military and the government were afraid the rights commission would backfire on them since it had the authority to investigate, a law-given privilege unique in the world. "I suspect there is a 'political deal' to maintain the commission as a toothless body," he said.

Asked whether the new composition of Komnas HAM would be beneficial to the TNI, People's Consultative Assembly deputy speaker Lt. Gen. Agus Widjojo said: "The TNI never impedes the legal process conducted by the rights body's personnel."

He was speaking on Wednesday after a discussion following the launch of the translated version of Geoffrey Robertson QC's Crimes Against Humanity: The Struggle for Global Justice, published by the Norwegian Embassy, Komnas HAM and Solidamor.

Law expert Harkristuti Harkrisnowo, who led the independent team to select candidates proposed for Komnas HAM members, pointed out that the new composition had yet to represent the country's pluralism.

Elsam co-founder Abdul Hakim Garuda Nusantara, an elected Komnas HAM members, told the discussion that the rights commission had lost its strength after the completion of their masterpiece inquiry on East Timor.

"Please, don't put high expectation on Komnas HAM. It was formed by the House and the government, and cannot be separated from political interests. The rights commission also depends on how well its partner is functioning, for example, the state prosecutors who follow up Komnas HAM inquiries. I cannot promise much, but I will do my best," Abdul Hakim told the discussion.

Many of the rights commission's inquiries have been abandoned or are yet to be prosecuted, including the shootings of East Jakarta's Tanjung Priok residents in Sept. 12, 1984 and the series of shootings of Jakarta students known as the Trisakti, Semanggi I and Semanggi II incidents in 1998 and 1999.

MPR annual session not to topple President Megawati

Tempo - July 10, 2002

Wahyu Dhyatmika, Jakarta -- People's Consultative Assembly (MPR) Amien Rais has guaranteed that this August's MPR Annual Session would not become a special session to topple President Megawati Soekarnoputri as there's no agenda to request an accountability report from the president.

"As MPR Speaker, I guarantee that the progress report or the president's annual performance report will not be used as an accountability report. There is no way there will be a demand for an accountability report from the president in this annual session," Amien told reporters at the legislature complex in Jakarta on Wednesday.

Amien made this statement in response to the worries of several people, particularly the Indonesian Democratic Party of Struggle (PDI-P) members, that the MPR Annual Session be used to topple the president.

Such authority has actually been revoked following the third constitution amendment last year. "There's no way that the annual session become a special session. It's impossible," stated Amien.

He admitted that the upcoming annual session had aroused controversies with the amendments to the 1945 Constitution, which will reduce the responsibilities of the MPR. "If the MPR agrees not to hold the annual session next year, it's quite alright with me. No problem with that," said Amien.

Amien does not mind if there are demands for the MPR to be frozen due to changes in the MPR's role and function in the constitution amendments.

"This institution belongs to many people, the society. If the people's representatives want the MPR to hold a session in 2003, let's do it. If it is not considered necessary and we just go along with the 2004 session, let's do that. Even if the MPR is frozen, as long as it is a joint-decision, let's go for it," said Amien.

PDI Perjuangan rocked by another resignation

Jakarta Post - July 11, 2002

Jakarta -- A senior Indonesian Democratic Party of Struggle (PDI Perjuangan) legislator has resigned in apparent disgust at the party's decision not to establish a team to investigate the Rp 40 billion (US$4.5 million) scandal at the State Logistics Agency (Bulog).

The exit of Indira Damayanti Soegondo has increased speculation that President Megawati Soekarnoputri's political party, which won the highest number of votes in the 1999 elections, is suffering serious internal problems.

Indira's resignation follows the recent exit of Dimyati Hartono and Sophan Sophian from the party chaired by President Megawati.

Dimyati, former chairman of the PDI Perjuangan faction at the House, quit last year during a clash with Megawati and other party figures over the party's political platforms.

Sophan quit in January for similar reasons. Indira confirmed that she had sent her resignation letter to Megawati on July 1, but added she was yet to receive no reply.

Indira was one of five legislators from the PDI Perjuangan faction that voted for the establishment of an inquiry team to probe the Bulog scandal that allegedly involves House Speaker Akbar Tandjung.

Only three PDI Perjuangan legislators followed Megawati's directions to vote against the establishment of the special investigation team, with most faction members abstaining from last week's vote.

Following the resignation of Sophan in January, speculation has developed that PDI Perjuangan is in the brink of a serious internal conflict.

Meilono Suwondo, who also voted for the establishment of the inquiry committee, was among PDI Perjuangan legislators who felt frustrated over his faction's policy on the bulog scandal.

PDI Perjuangan has become the target of public criticism for its weird policies, including Megawati's support for incumbent Jakarta Governor Sutiyoso for a second term in office and rejection for direct presidential election in 2004.

Megawati, legislators at odd over commission

Jakarta Post - July 11, 2002

Sri Wahyuni and Kurniawan Hari, Yogyakarta/Jakarta -- President Megawati Soekarnoputri locked horns on Wednesday with legislators over the need to establish an independent constitutional commission.

Closing a three-day seminar on the Constitution organized by Kagama, Gadjah Mada University's alumni association, Megawati said an institution comprising members with expertise, wisdom and experience was needed to paint the big picture as regards the constitutional amendment process. But legislators rejected the proposal to set up a commission to take over the process of amending the 1945 Constitution from the People's Consultative Assembly (MPR).

They questioned the urgency for such a commission citing the MPR's "proven competence" in updating the national charter.

"I don't think we need a constitutional commission. But, if the fourth amendment ends up deadlocked, the establishment of such a commission could become a possibility," said the chairman of the assembly's ad hoc constitutional amendment committee, Jacob Tobing, in Jakarta on Wednesday.

The assembly is slated to discuss the fourth raft of amendments to the Constitution during its annual session in August. The first series of amendments was made in October 1999, the second in August 2000 and the third in November 2001.

Megawati said the big picture should include studies on which parts of the Constitution needed amendment, the direction and goals of the amendments, the consequences of the amendments, and the formulation of the amendments themselves, Megawati said.

In short, she said, there should be an inventory of what information should be disseminated to the people for their approval.

"It was within this frame of understanding that I came out with the idea of a constitutional commission," Megawati said. "Whether it means that we need a referendum or whatever you like to call it [to establish an independent constitutional commission], we must comply with the principle of respecting the people's rights," she added.

Megawati fought back her tears when mentioning the role of the founding fathers in the formulation of the 1945 Constitution.

Another legislator, Yusuf Muhammad (National Awakening Party -- PKB), said the idea of setting up such a commission had come too late as all party leaders supported the amendments made by the Assembly. Golkar legislator Baharuddin Aritonang dismissed the proposal as an outdated idea.

Three factions, the Megawati-led Indonesian Democratic Party of Struggle (PDI Perjuangan), Golkar, and the National Awakening Party had floated the idea of establishing a commission during the assembly's 2000 Annual Session.

But what was proposed by the factions was diametrically opposed to what had been proposed by scholars and activists who had joined together in an coalition of NGOs to press for an independent commission.

The three factions insisted that the commission should be incorporated into the assembly's existing ad hoc commission, while the NGO coalition demanded that the new commission have full power to draft amendments.

According to the coalition proposal, the Assembly would have to accept and approve the draft amendments. If the Assembly rejected them, there would then be a national referendum so as to give the public the last say.

Over the past months, the coalition has tirelessly campaigned for the establishment of an independent constitutional commission.

Some 300 students from Gadjah Mada University and activists from the KAMMI Muslim students' association held a rally during the closing ceremony carrying banners and posters condemning Megawati as the killer of reform.

"Megawati's presence on the campus is nothing but an affront to Yogyakarta students, who have been vocal and firm in demanding reform," read a statement signed by the KAMMI Yogyakarta chairman Imron Rosyadi.

The students said they were protesting the fact that Megawati, whom they perceived to be an anti-reform figure, was the one who received the results of the seminar.

The workshop came out with two options. First, to synchronize and to systematize the previous three amendments and to consider them as part of the Constitution during a transitional period.

Former Gadjah Mada University rector Ichlasul Amal seemed to offer a middle way when he emphasized that the "synchronization and the systematization" process did not necessarily mean the annulling of the previous amendments.

Second, to amend Article 37 of the 1945 Constitution and set up an independent constitutional commission to draft a constitution within a year based upon public participation.

Article 37 stipulates that at least two-thirds of the People's Consultative Assembly members should be present and that at least two-thirds of the members should express their agreement before the Constitution may be amended.

"We hope the August Annual Session will adopt the options we have offered. That way they will avoid a possible deadlock," Ichlasul said.

LIPI identifies many flaws in political bills

Jakarta Post - July 10, 2002

Kurniawan Hari, Jakarta -- Political observers with the National Institute of Sciences (LIPI) urged the House of Representatives (DPR) on Tuesday to give the public a chance to critique and give inputs to the bills on elections and political parties which they say have many flaws.

They said public participation was also needed to enrich the bills as well as to prevent House factions from manipulating them for their own political interests.

"We hope the House will be open to criticism and inputs from the public, especially non-governmental organizations and students, to channel the people's political aspirations," said LIPI researcher Ikrar Nusa Bakti.

Fellow LIPI researcher Syamsuddin Haris added that the legislators should pay serious attention to the deliberation of the bills which will be the legal basis for the 2004 General Elections.

Both researchers were commenting on the substance of two bills on political parties and general elections. The government has yet to submit the bill on the composition and structure of the People's Consultative Assembly, the House, the provincial and regency legislatures. The bills will likely include direct presidential election if the Assembly agrees to include the issue in the upcoming Annual Session.

Syamsuddin emphasized that the bills designed by a team from the home ministry had too many flaws.

Instead of providing a term of reference for direct presidential elections, the bill on general elections merely provides guidance for legislative elections.

Syamsuddin said this was not in line with the third amendment to the Constitution that was endorsed last year. According to the third amendment general elections to elect legislators at the House, Assembly and provincial and regency legislatures are to be held in conjunction with direct presidential elections. Syamsuddin also criticized the bills for limiting the number of legislative seats to 550, saying there were no legal or pragmatic reasons for the figure.

He said that the number of seats should be put in the bill on the composition of the MPR, the DPR, the Regional Legislative Council (DPRD), and the Regional Representatives Council (DPD).

In addition, Syamsuddin proposed that the General Election Commission (KPU) should be independent and its secretariat must be run by an independent secretary-general who is loyal to the commission leadership, instead of the Ministry of Home Affairs.

The issue of the KPU leadership has been the main concern of pro-reform activists. They say all the regulations in the bill will be rendered useless if the KPU is not independent.

Syamsuddin feared that the article in the election bill that stipulates that the secretary-general will be from the home ministry could create anomalies in the election process at either the central or regional level.

"We must ensure that the bills will not revive the influence of the government on the political parties," Ikrar added, referring to the practice during the New Order regime. The House has set up two special committees to deliberate the two bills but the deliberation is expected to take a long time to complete.

MPs 'have better things to do than probe Akbar'

Straits Times - July 9, 2002

Jakarta -- Indonesian President Megawati Sukarnoputri yesterday defended her party's decision not to seek a parliamentary inquiry into alleged graft by the Speaker, saying legislators have more important things to do.

Her Indonesian Democratic Party of Struggle, the largest single party with 153 of the lower house's 500 seats, last week abstained in a vote and thus foiled plans to set up a commission to probe Akbar Tandjung.

Akbar, who also heads Golkar, the second largest party with 120 seats, is currently on trial over the financial scandal concerning the misuse of funds from the national food agency, Bulog.

"Not everything has to be settled by a special commission," Ms Megawati was quoted as saying by Mr Al-Amien Nur Wahab, the chairman of a youth group affiliated with the nation's largest Muslim organisation, Nahdlatul Ulama.

"There are still a lot of draft Bills that have yet to be debated or passed by Parliament," Ms Megawati reportedly told Mr Al- Amien.

Mr Al-Amien, speaking at the palace after meeting the president, said Ms Megawati did not want to further burden the Parliament with another probe commission.

"And also, what then would be the role of the judiciary?" the President reportedly said.

As state secretary under president B.J. Habibie in 1999, Akbar was charged with overseeing the 40 billion rupiah emergency programme to feed poor families in Java using Bulog funds.

Prosecutors say there is no evidence that any food was ever distributed. Akbar denies any wrongdoing, saying he was misled by others in the case.

His trial opened in March and is expected to continue until August. He could face up to 20 years in prison if found guilty. Analysts have been quick to write off Akbar's political career and several Golkar members have called for his resignation. But the veteran politician has refused to step down pending the verdict.

One of Akbar's co-defendants, businessman Winfried Simatupang, told Akbar's trial yesterday that the decision not to buy food and to keep the money had come from the late Dadi Suryadi, an executive of an obscure foundation which Akbar assigned to implement the distribution.

Winfried, who in a controversial move had returned the 40 billion rupiah in cash in several instalments to prosecutors, said he had kept the amount in a drawer in his bedroom for two years.

Politicians have aired suspicions that the money was channeled to Golkar for its 1999 general election campaign.

Critics of the decision by Ms Megawati's party not to support a commission have accused it of collusion with Golkar and abandoning its reform ideals.

Student groups have also complained that Akbar would escape justice in Indonesia's corrupt legal system. They say a parliamentary probe would increase political pressure on him to quit politics and expose other key politicians involved.

A total of 193 House members voted against the setting up of the special committee, 73 others agreed to it and 94 abstained.

Corruption/collusion/nepotism

Police question McDonald's Indonesia boss on loan

Reuters - July 8, 2002

Jakarta -- Indonesian police questioned the local franchise holder of fast-food chain McDonald's for seven hours on Monday over a suspected graft scandal involving millions of dollars.

Police say Bambang Rachmadi, the son-in-law of a former Indonesian vice-president, is suspected of obtaining a 40 billion rupiah loan unlawfully from state pension fund Jamsostek and failing to pay it back.

"We asked him 29 questions and we will question him again soon. But we won't detain him now," Anton Wahono, head of the corruption division for the Jakarta police, told reporters. "We can't detain people without careful consideration." Rachmadi failed to answer a summons to appear for questioning in early April after being questioned a month before and police said then they would definitely arrest him.

Rachmadi denied that he had tried to evade the police summons and said he was not guilty of anything.

"I told the police before I left that I planned to go to Australia and the United States for two months. And I've told them I want to go to Kuala Lumpur soon," he told reporters.

"Who said I'm a fugitive? I have paid back all of the debts. I have nothing to lose and nothing to hide," he added.

The loan was made to the Rachmadi-controlled holding company for McDonald's Indonesia -- the country's largest fast-food chain with 76 outlets in 17 cities.

Jamsostek is the country's largest pension fund. Police have named two former officials suspected of giving Rachmadi's company the loan in 1999 without approval from the Jamsostek board of commissioners.

There have been a spate of high profile corruption cases in Indonesia, that some political analysts say shows President Megawati Sukarnoputri is serious about cracking down on graft, which has made the country a byword for corruption. Verdicts in most of the cases have yet to be delivered.

When Megawati took power last July she promised to clamp down on graft, much to the scepticism of many Indonesians and foreign investors.

Rachmadi is a son-in-law of former Indonesian vice-president Sudharmono, who also once headed the former ruling Golkar party.

Regional/communal conflicts

One dead, four hurt in explosion in riot-hit Poso

Agence France Presse - July 13, 2002

A teenager was killed and four other people were wounded when a bomb exploded outside their bus in the troubled Poso district of Central Sulawesi, according to police.

It is the latest challenge to a peace deal signed between Muslims and Christians in the area last December.

The explosion happened Friday when the bus driver's assistant, or conductor, got out of the bus to examine a bag found on the road in front of them, a police officer in Poso town told AFP Saturday. He said the wounded passengers and a 17-year-old girl who died had got out of the bus with the conductor.

He said they were travelling from the provincial capital of Palu to Tentena, a predominantly Christian town where the wounded are being treated at hospital.

"The hand of one victim was severed," the officer said.

Reports said the explosion happened about four kilometres (2.6 miles) from Poso.

The police officer could not say whether anybody has been arrested or what type of explosive material caused the blast.

"This is still being investigated," he said.

In June, four people died and 17 were wounded when a bomb ripped through a crowded bus near Poso.

An estimated 500 to 1,000 people were killed and tens of thousands made homeless during two years of intermittent Muslim- Christian fighting in the Poso area which broke out in 2000. A government-brokered peace deal in December brought a shaky peace to the region.

Another peace pact, also brokered by Jakarta, was reached in February between Muslims and Christians in the Maluku islands to the east of Sulawesi.

That agreement has also been threatened by bombings and other acts of violence.

Local & community issues

300 foreign vessels looting fishing areas

Jakarta Post - July 8, 2002

Apriadi Gunawan, Medan -- Around 300 foreign vessels believed to be from Thailand are looting fish stocks in North Sumatran waters and robbing local fishermen of their livelihoods, according to Governor T. Rizal Nurdin.

Rizal urged the central government to take action against the illegal foreign vessels he said were operating off the western coast of North Sumatra. "The arresting of these fishermen is wholly the responsibility of the Navy," Rizal told The Jakarta Post over the weekend.

He said the foreign fleet had been plaguing the local fishing industry for "quite some time", but he fell short of saying how much had been inflicted in losses.

According to government estimates, losses from illegal fishing nationwide could reach up to US$4 billion a year. These were a combination of losses from illegal foreign vessels and the violation of export regulations by local fishing vessels.

Indonesia's own fishing exports stood at just $1.17 billion last year, down slightly from export sales in 2000. By law, foreign fishing vessels may enter Indonesian waters. However, they must pay a fee to the government.

Government officials said that many foreign vessels purchased fishing licenses from local fishing companies to avoid paying the fee. Many of these local fishing companies were only phony companies, set up as a front to sell permits to foreign vessels.

Secretary to the All-Indonesian Fishermen's Union (HNSI), Sibolga Kastamansyah, said the organization frequently informed the government about the presence of illegal foreign vessels in North Sumatran waters. "But we haven't seen any results. Neither has any concrete actions been taken by the authorities," he said.

Kastamansyah said the vessels from Thailand had been operating in their area for several years without interference from the government.

Using trawls, the illegal vessels not only catch mature fish but immature fish, thus effectively cutting supply to unsustainable levels. "We feel that the lot of the fisherman is getting worse by the year," Kastamansyah said.

Last year, Minister of Maritime Affairs and Fisheries Rokhmin Dahuri said his office had prepared a set of measures to curb illegal fishing by foreign vessels. Among the measures was the registering of fishing vessels operating here and the use of tracking devices through a satellite link to filter out illegal vessels from the legitimate ones. This way, he said, he expected to reduce by 25 percent the 4,900 fishing vessels that were operating illegally in Indonesian waters.

Human rights/law

Big names on trial, but corrupt courts seen as block

Associated Press - July 10, 2002

Lely T. Djuhari, Jakarta -- Former dictator Suharto's son is accused of murdering a judge who ordered him jailed for graft, the head of the Central Bank has been convicted of misusing $80 million in bank funds, and the speaker of Indonesia's Parliament is on trial for corruption.

On the surface, these high-profile trials suggest that Indonesia is finally getting tough on rich and powerful suspects who have flouted the law for decades. But critics say most of the trials are a farce, with justice for sale to the highest bidder.

"It's a mess," said Indonesian anti-corruption activist Benny Harman. "It's hard to hope for a decent ruling on corruption when the arbiter is seen as corrupt." Four years after Suharto was ousted amid demands for a cleanup, graft is still endemic.

It threatens to scuttle Indonesia's hopes of recovering from the 1997 Asian financial crisis, because business leaders complain that the corrupt courts mean it's often impossible to enforce or settle disputes.

While the government of President Megawati Sukarnoputri has won some praise for beginning to attack corruption, many Indonesians are skeptical that justice will be done in a slew of cases involving influential figures.

In the murder trial of Hutomo "Tommy" Mandala Putra, Suharto's youngest son, many prosecution witnesses have recanted their original stories, and the lead defense attorney was briefly jailed after being accused of bribing witnesses for favorable testimony. The trial was adjourned Wednesday for a week after the billionaire defendant failed to show up due to illness.

Few expect Parliament Speaker Akbar Tandjung, still in office despite being on trial on charges of misusing $4.5 million of state funds, to be convicted. Last week, about 300 students -- fearing Tandjung would escape the justice system -- demonstrated to demand a special parliamentary probe. Police broke up the protest with a water cannon and batons.

The Tandjung and Tommy trials, which are being broadcast live on national television, are entering their final stages. Central Bank chief Syahril Sabirin has already been convicted, but is appealing -- a process that can take years. Meanwhile, he is still at the helm of the Central Bank.

"Corruption in the legal system here happens at all levels and at every opportunity," said Wangstuti Zakiyah from Indonesian Corruption Watch.

She said defendants could pay for the judge they wanted to hear their case and bribe prosecutors to write favorable indictment papers. Bribes to the county's more than 5,000 judges are not always direct payments in cash.

"One judge asked for the defendant to pay billions of rupiah for his daughter's wedding in exchange for a more lenient verdict," said Zakiyah. "Another asked for an exorbitant fee to speak at a legal seminar."

Chief Justice Bagir Manan acknowledged his courts had problems. "We are understaffed, poorly paid and have limited authority to sanction those involved in corruption," he told The Associated Press.

Manan said the country's 38 Supreme Court judges were overworked, with some handling as many as 60 cases simultaneously. This caseload can lead to rushed decisions, he said.

Some investors say things are worse than under Suharto, when corruption was at least organized in a reliable patronage system. "Now, you still have to pay, but you can't sleep at nights wondering whether it will bring you any good," said an Indonesian businessman who spoke on condition only his first name, Djoko, was used.

Meanwhile, it's business as usual in the lobby of the Central Jakarta District Court. A 'broker' who calls himself John offers his services to speed up decisions and arrange meetings with judges. "I'll pay the judge 50 million first" -- equal to $5,700 -- he was overheard saying by phone to a client. "I don't know if I have any more cash now."

Court overturns Manulife-Indonesia bankruptcy

Voice of America - July 8, 2002

Patricia Nunan, Bangkok -- Indonesia's Supreme Court has overturned a controversial bankruptcy ruling against the Jakarta branch of a Canadian insurance company. The case against Manulife-Indonesia had raised serious questions about the independence of Indonesia's judiciary and alarmed foreign investors.

The Supreme Court ruled that the bankruptcy order against Manulife-Indonesia was not valid, and is therefore void. Last month, Indonesia's commercial court declared the Canadian- affiliated company bankrupt, based on a complaint by a former Indonesian joint venture partner. The commercial court said the reason was that the company failed to pay dividends to shareholders in 1999.

The court ignored the fact that Manulife says its board of directors had voted against paying a dividend that year or that the company, one of Indonesia's largest insurers, showed a profit and had hundreds of millions of dollars in assets.

The Canadian government and international companies said the ruling could adversely affect foreign investment in Indonesia and raised questions about the country's judicial system. Manulife says its problems began when it tried to buy out the 40 percent shares owned by its Indonesian joint-venture partner in October 2000, after it had gone bankrupt. Since then, Manulife says it executives have been harassed and were victims of attempted extortion.

Manulife-Indonesia's Director Philip Hampden Smith says his company was targeted because of its success. "Because when people see that you're successful at making money," Mr. Smith explained, "you become a target. When you look at companies in Indonesia that have done well, most of them have become targets at some time or another because, obviously, [they] maybe cash rich."

Indonesia's Justice Ministry has ordered an investigation into the three commercial court judges who passed down the bankruptcy declaration. The Supreme Court's decision comes weeks ahead of the arrival of a United Nations legal expert, for a fact-finding mission on the independence of Indonesia's judiciary.

Power, money rule Indonesia's judiciary: Experts

Jakarta Post - July 8, 2002

Bernie K. Moestafa, Jakarta -- With a United Nations fact-finding mission yet to set foot on Indonesian soil, legal experts said it would likely find here a judiciary far from being independent, and hostage to money and politics.

Legal expert Harkristuti Harkrisnowo of the University of Indonesia said corruption, and government and legislative interference were commonplace in the Indonesian courts. "We know how bad things are here, the police, prosecutors, lawyers and judges," Harkristuti said over the weekend.

So does the government. At its request, the UN will send its special rapporteur Dato' Param Cumaraswamy from July 15 to July 25 on a mission to assess the country's legal system. He will report his findings to the UN Human Rights Commission during its annual session in April 2003.

But even before he has to arrive in Jakarta, the international community is already well aware of Indonesia's poor track record.

The stream of bad news that has flowed out of the country's commercial court has deterred foreign investors. And the UN has persistently asked for headway to be made in the human rights tribunal on atrocities committed during the 1999 East Timor violence.

Cumaraswamy's planned mission comes at a time when the Jakarta Commercial Court has once again drawn international attention with its controversial bankruptcy ruling against insurance firm PT Asuransi Jiwa Manulife Indonesia (AJMI) of Canada.

AJMI's downfall is yet another clear example of Indonesia's imploding legal system. Other examples abound. Last year, the International Finance Corporation (IFC) stumbled over what it charged were fictitious creditors blocking its attempt to have a local company declared bankrupt. Subsequently, the IFC suspended its investments here while its affiliate, the World Bank, trimmed its lending to Indonesia.

Such cases have made investors wary, making it hard for the government to attract them amid an already adverse business climate. Political instability and rampant security threats are other risks investors are trying to avoid when they decide not to come here.

Bankruptcy law expert Rahmat Bastian said that just about every case that went to the Commercial Court ended up disadvantaging foreign investors.

All of which helps to explain why foreign companies try to seek justice outside Indonesia whenever possible. Such moves are already bearing fruit. Singaporean and US courts have issued orders to freeze Indonesian assets, something virtually unheard of in the local courts.

Rahmat said that he saw the judges during the Soeharto era dispensing fairer justice then they do now. "Today it seems as if there is no need to be ashamed when taking sides." While this was apparent in cases where bribery took place, he said that in cases filed against the government, the judges too tended to side with the government. "The government almost never looses a case logged in the State Administrative Court," he said. According to him, judges appear not to care much about whether their verdicts were justifiable.

Harkristuti added that some judges felt they could translate the law the way they saw fit. She said it did happen that judges passed opposing verdicts in two identical cases. "We're loosing the parameters that defines justice," she said.

She said the Indonesian courts were also prone to government interference as a consequence of politics coming in the way.

Lack of independence, critics said, was also evident in the case of Indonesia's human rights tribunal. The trial against military officials implicated in the 1999 violence in East Timor, they said, had come under pressure from the military.

Legislator Muhammad Abdul Mochtar said he hoped Indonesia could make the most of Cumaraswamy's visit. "What we need is thorough legal reforms," said Mochtar, a member of the House of Representatives' Commission II, which is in charge of home and legal affairs.

Focus on Jakarta

Garbage problems still looming

Jakarta Post - July 12, 2002

Jakarta -- Garbage problems continue to haunt the Jakarta city administration.

The Bekasi legislative council complained on Thursday about what they saw as poor management of the garbage dumped at the Bantar Gebang site by the Jakarta Sanitation Agency.

Councillor Nurul Yakin of the National Mandate Party (PAN), claiming to represent the council, said the city administration had failed to improve sanitary landfill systems.

The current method left awful smells that spoiled the nearby residents living conditions, he said. Jakarta dumps an average of 25,000 cubic meters per day at Bantar Gebang.

"The Jakarta administration must be able to deal with the garbage in the dump site professionally so as not to cause more environmental problems for local residents," he was quoted by Antara as saying.

Nurul also blamed the city administration for failing to keep its promise to improve the condition of Bantar Gebang dump site by, among other things, renovating the irrigation and repairing damaged walls surrounding the dump site and the access road.

Nurul said that the Bekasi legislative council would soon observe and examine the environment around the dump site, including residential areas.

The latest complaint will seemingly prolong the dispute between the city administration and the Bekasi mayoralty over the dump site, which started late last year.

The Bekasi mayoralty has threatened to close the 104-hectare dump site should the Jakarta Sanitary Agency fail to implement a proper sanitary landfill system.

The as many as 18,000 local people living around the dump site have frequently complained about the environmental degradation due to the improper garbage handling in Bantar Gebang. Some have suffered from skin problems, diarrhea and other illnesses, reportedly due to the waste.

In February, residents burned a dump truck belonging to the city administration. They said they were upset with the drivers who dumped the waste outside the dump site.

The dispute then cooled down after a series of meetings between both sides, mediated by the central government. The deal was that Jakarta was still allowed to dump its garbage in Bantar Gebang until 2003.

In March, Governor Sutiyoso handed over a cheque worth Rp 14 billion to Bekasi Mayor Nonon Sonthanie. The money was part of Rp 22 billion promised by the city administration to improve the sanitary landfill system and the social facilities for residents around the area. Another Rp 8 billion is supposed to be given next year for similar purposes until the dump site is closed in 2003.

The Bekasi mayoralty is assigned to maintain Bantar Gebang and report the development to the Jakarta administration. There was no explanation why the Bekasi councillor did not check with the mayor over the implementation of the renovation and repair works funded by the Rp 14 billion.

$630,000 for four gorillas, $123,000 for city's poor

Straits Times - July 11, 2002

Marianne Kearney, Jakarta -- Four male gorillas which arrived here recently are proving to be some of Jakarta's most controversial guests.

Residents are outraged that the government plans to spend 3.2 billion rupiah on imported fruits for the primates -- much more than the 625 million rupiah allocated for the city's poor people last year.

After a delay following security concerns due to the September 11 attacks last year, the four gorillas arrived at Ragunan Zoo on Monday from Howlett and Port Lympne wildlife park in Britain. They are a present from the park.

According to the Jakarta Parliament's budget commission, Ragunan Zoo has requested that the council allocate 3.2 billion rupiah to feed the four animals.

"The gorillas need special food, which is very expensive -- such as apples from overseas and other food that is not local but fitting with their usual standards," said Ms Anna Rudiantika from the budget commission.

She said zoo managers had explained why they needed a special diet and the Parliament has approved the 3.2 billion rupiah disbursement.

But no money has yet been channelled to the zoo, she revealed. The expensive food bill has angered Indonesians, particularly in a city where -- according to international aid groups -- several hundred thousand children are suffering from malnutrition.

"How could the maintenance of such animals be worth millions of rupiah, which derives from the city budget? As a Jakarta resident, I feel insulted by such a plan," said Ms Sisca, a mother of two from South Jakarta.

However, the international wildlife organisation which organised the sending of the four gorillas and built their 0.8-ha zoo enclosure, said there was no need for the zoo or the city council to bear any of the costs for the feeding or upkeep of the gorillas.

"They are in two acres of natural forest, there is more food than they can eat. It is like a giant two-acre salad bowl," said Mr Willie Smit, director of the Gibbon Foundation in Indonesia.

Mr Smit dismissed claims that the gorillas would need a special diet before they could adjust to Indonesian fruit.

He added that transportation of the gorillas, the building of the 1 billion rupiah enclosure, as well as any food bills, were all being paid by a deceased benefactor, Ms Puck Schmutzer. Ms Schmutzer, of mixed Indonesian-Dutch descent, wanted to fund one of the best primate centres, said Mr Smits.

The now-completed gorilla enclosure at Ragunan Zoo is the largest primate facility in South-east Asia.

Mr Smit said he was not sure who was behind the scheme to make money from the gift of the gorillas and making claims about their expensive dietary habits.

However, he said the whole project would be audited by Price Waterhouse Coopers accountants to ensure there was no leakage of the donated funds.

"Ms Schmutzer was very strict about that kind of thing -- corruption. She wanted written on her grave: 'Animals don't let me down.'" he added.

A spokesman for Ragunan Zoo, Mr Madinah, denied the zoo had demanded funds to feed the gorillas. He also said that the zoo would become of the best primate centres in the region, as it housed several other primate species such as silver leaf monkeys, black gibbons, grey gibbons, and was planning to build an orangutan enclosure as well.

Street vendors protest eviction

Jakarta Post - July 9, 2002

Nana Rukmana, Cirebon -- Hundreds of street vendors and becak (pedicab) drivers occupied the municipal office here on Monday, in protest over their forced eviction from areas around shopping malls.

The protesters demanded the local government allow them to operate in the areas around the shopping malls.

"They use hoodlums or pay security officers to drive us out. The city doesn't even ban us from operating there," said Bambang Supriyanto, the coordinator of the street vendors.

According to him, street vendors and becak drivers around the areas of Cirebon Mall, Grage Mall, and the Asia and Yogja supermarkets have been forced to leave.

"It's true that the managers don't forbid us, but there are certain people always threatening us and saying we should not be here," said Bambang.

Cirebon Mayor Lasmana Suryaatmadja accepted the protesters' demand for a meeting and promised to help them resume operations around the shopping malls as soon as possible.

"For the time being we will allow them to operate there until we issue a ruling regulating their areas of operation," said the municipality spokesman Tuti Suryawati. "We will also ask the managers of these supermarkets to coexist with them peacefully." Bambang said he expected Lasmana to keep his promise otherwise they would return in greater numbers.

Cirebon, he said, was home to about 1,000 street vendors, spread across the city's traditional markets and other crowded areas. Becak drivers numbered about 6,000, operating in two shifts.

Most of the street vendors and becak drivers are migrants from the Central Java regencies of Tegal and Brebes and neighboring West Java regencies of Indramayu, Tasikamalaya and Kuningan, said Bambang.

Legislative council speaker Suryana said the absence of proper regulations on the informal sector had caused street vendors and becak drivers to often complain to the local government of discriminatory practices against them.

News & issues

Judge orders check on Tommy after he reports sick

Straits Times - July 11, 2002

Jakarta -- An Indonesian judge yesterday ordered prosecutors to check on Tommy Suharto in jail after the youngest son of former president Suharto sent a sick note to his murder and weapons trial.

Prosecutors were due yesterday to present final arguments and recommend a sentence should the five judges find him guilty. Both charges are punishable by death.

But chief judge Amiruddin Zakaria read out a letter from a jail doctor certifying that Hutomo 'Tommy' Mandala Putra, 39, was sick and needed rest.

Prosecutor Hasan Madani told the court it was strange the letter was only filed the day the defendant was to appear and that the doctor had left blank the number of rest days he needed.

Questioned after the trial, Mr Madani declined to speculate whether the sickness was a means of buying time.

Mr Muhammad Assegaf, one of Tommy's lawyers, said he was only told of the letter earlier yesterday and had no details of the illness.

Judge Zakaria ordered prosecutors to visit Tommy in jail to observe his condition. The Cipinang jail doctor Ilham said yesterday that he had been summoned by the head of the jail to examine Tommy after complaints that he was suffering from diarrhoea.

"In the letter, if you read it, it only states the sickness but I did not say how long he needed to rest and I certainly did not say that the trial should be postponed. That is for the judges to decide," Dr Ilham said.

The court was adjourned until Monday when both prosecution and defence will sum up their arguments. The judges will then announce their verdict and pass sentence, should the defendant be found guilty.

Indonesia's fire traps

Straits Times - July 10, 2002

Marianne Kearney, Jakarta -- As the death toll from Sunday night's grisly fire in a South Sumatra karaoke club climbs, building experts admit that many karaoke bars, entertainment centres, hotels and even office buildings are fire disasters just waiting to happen.

Palembang Fire Department head Andas Bastoni said he was not surprised that at least 53 had perished when the fire, believed to be the result of faulty electrical wiring, hit the Heppi 45 karaoke club.

"All the floors were sub-divided into many, many little rooms. Lots of rooms for asoy," said Dr Andas, using a slang word for fooling around. Karaoke clubs in Indonesia often double up as brothels.

"There were no proper escapes as the corridors between them were only one metre wide," he said. As well as no fire escapes, there was no emergency exit on the ground floor.

The five-storey club should also have had windows that opened but the owners had built fake ones facing the main street to cover up solid concrete walls.

Many victims probably died from smoke inhalation when they were trapped on the upper floors, said Dr Andas.

The Fire Department had to blast holes in the street-front walls to try to recover victims. Some bodies had been so badly burnt they were just charred bones.

Those caught on the upper floors could not be rescued immediately because the fire department's longest rescue ladder was not long enough, said Dr Andas.

And emergency workers said yesterday that there could be more bodies to recover as the top floor was still too hot to enter.

The owner of the building applied for a restaurant licence two years ago but later opened a karaoke club in secret -- a common practice in Indonesia, according to Dr Andas. The owner, now wanted by the police, also added two storeys to the original three-storey building without government consent.

Palembang police said yesterday they had arrested the club's manager, identified as Akun.

Palembang, an industrial city in South Sumatra, has at least 50 other hotels, supermarkets and office buildings which do not meet fire regulations issued in 2000, said Dr Andas.

The problem is widespread in the country. According to Mr Robert Simantuk from Jakarta's Building Inspection Department, many cities across Indonesia have poor fire-safety and building standards as there is no national yardstick.

But several local governments were taking it upon themselves to try to meet fire safety criteria in the capital.

In Jakarta, the city with the strictest fire legislation in Indonesia, new buildings must have a fire exit located at least 50 m from corridors or public spaces. And a five-storey nightclub or entertainment building would have to have at least one emergency stair exit, said Mr Simantuk. Cinemas, malls and offices must all have fire detectors, smoke detectors and sprinkler systems.

But Jakarta-based architect Sonny Sutanto, who designs hotels, malls and large office buildings, said: "It is easy to bend the rules."

Jakarta bookies ride on Singapore lottery

Straits Times - July 10, 2002

Robert Go, Jakarta -- Every Monday and Thursday at 5 pm, office clerk Danial Erwin makes his most important calls of the week -- to his bookie, to check winning numbers.

Like millions of Indonesians, Danial is hooked on togel, short for toto gelap, an illegal 4-D game that piggybacks on Singapore Pools' lottery results. He bets 60,000 rupiah (S$12) or more each week -- a substantial portion of his income -- with the hope of striking it rich.

"My wife doesn't like it at all," he says. "She complains that I just waste money. Of course, I am careful and never spend too much."

More than a decade ago, Indonesian bettors did not have to "borrow" winning numbers from Singapore, but played the Jakarta government's own lottery games, or a togel system that used the government's winning numbers. The proceeds were supposedly used to fund the Suharto government's various social and development projects.

Betting is now illegal in the country but that does not stop low-income Indonesians from playing games of chance.

Bookies organise themselves in a pyramid scale. A handful of big bosses are on top, a small number of major players stay at the intermediate level, and a vast number of street-level bet-takers serve the millions of players. The racket is hugely popular and exists in all major cities, including Jakarta, Surabaya, Medan and Bandung.

While it is nearly impossible to get a precise figure on how much money is exchanged during any given week, one street bookie told The Straits Times that it reaches into billions of rupiah weekly at the top level.

"You wouldn't believe how much it's worth by looking at the small bet amounts. But there are lots of players, and it all adds up if you control the scheme," he said.

The bookie said he makes about a million rupiah each week -- a good income. He keeps 25 per cent of the bets he takes and hands over the rest to his boss, who deals with a bigger agent above him in the pyramid.

Although togel is illegal, people say the police are actually involved in the game as well, either directly or by protecting the players involved for a fee. Another group also benefits from togel: The dukuns, or witch doctors, who give out auspicious numbers to desperate bettors.

Mr Danial said: "I won big once after consulting a dukun. He gave me four numbers and I put 1,000 rupiah on it. I think he only asked for a 5,000-rupiah payment, but I got back 2.5 million rupiah. My wife didn't get mad at me that time."

Bets start at 10 cents

The togel system is simple enough: it uses the last four digits of Singapore Toto's winning seven-digit numbers.

Players can place bets, ranging from 500 rupiah (10 Singapore cents) per number to more than 100,000 rupiah, on two, three or four digits. The odds are one to 60, one to 400 or one to 2,500, respectively.

On Mondays and Thursdays, the same drawing days as in Singapore, bookies pay out to winners and keep the losers' cash. There is also a togel game based on a Malaysian lottery drawn on Sundays.

One city's trash, one town's cattle feed

Straits Times - July 8, 2002

Marianne Kearney, Jakarta -- Cities around Indonesia are increasingly drowning under a sea of rubbish as local governments struggle to cope with the mountains of garbage produced every day.

But in Yogyakarta, residents have found an unusual way of processing their city's rubbish by using mobile and natural recyclers -- cows.

Every day at Ngablak, a rural town in the countryside outside the city of Yogyakarta, hundreds of local farmers bring their prized cows to graze in one of Java's, and probably Indonesia's, most unusual grazing fields -- the council rubbish tip.

The cows chew their way through household garbage, leaves and rural rubbish alongside the usual horde of scavengers who collect the man-made rubbish like glass, plastic, metals and paper.

"They eat leaves, vegetables, and even rags but they can't eat the plastic," said Mr Suropo from Yogyakarta's rubbish removal and cleaning services.

While these bovine rubbish processors might be a hindrance to the rubbish trucks and forklift operators, their dung helps break the remaining rubbish much faster, he said.

Some cows, of course, have found grazing in the rubbish tip a little dangerous. "Some cows were cut and injured when they ran into a truck, but the owners have to take responsibility for their cows," said Mr Suropo.

The farmers, mostly residents from the surrounding villages, are quite happy to run the risk of the odd injured cow because they are able to feed their cows for free. For most farmers, buying feed for their cows is expensive and finding free grazing land is almost impossible except in more remote parts of Java.

Two years ago, only a handful of cows came to graze at the rubbish tip. Now the number has swollen to 200 cows as the farmers and the rubbish tip manager agreed to work together. "We can improve the welfare of the local people as well as reduce the volume of rubbish here," said Mr Suropo happily.

Every day, the city of Yogyakarta produces 30 to 40 tonnes of rubbish, estimates Yogyakarta's Sanitation Agency. As in most cities across Indonesia, paper, glass and plastic are sorted and recycled by scavengers. Until recently, there was no way of recycling the food scraps and other household waste.

The Ngablak rubbish tip probably would have been overflowing with this non-recycled waste in 10 years' time, Mr Suropo said, but with the cows working their way through much of the natural waste, the tip would be operational for 15 years.

Across Indonesia, as rubbish dumps reach their use-by date, and residents and local governments argue over where to locate new landfills, waste has been literally piling up in the streets.

Earlier this year, Jakarta's City Sanitation Agency came to blows with the residents and the government of Bekasi, an outer suburb of Jakarta, as residents objected to having the rubbish dump located near their homes. And in Surabaya, East Java, the city's rubbish was not collected for nearly a month as the government failed to find a new site for its rubbish tip last year.

Mounting piles of rubbish in Jakarta's streets and canals were partially to blame for the devastating floods that hit the city in February this year, said government officials.

Jakarta residents dumped about 3 million cubic metres of rubbish every year in the city's rivers, said Mr Kosasih Wirahadikusumah from Jakarta's Environmental Impact Management Agency (Bapedalda).

Officials at the City Sanitation Agency estimate that scavengers are able to recycle about 70 per cent of the city's rubbish. The rest -- much of which is actually biodegradable -- is left to collect in the rubbish dumps.

Jakarta's sanitation officials say they are talking to foreign companies about trying to recycle household rubbish and turning it into animal feed. But none of the other city governments, except for Yogyakarta, has invited the animal recyclers onto their rubbish tips.

Environment

West Kalimantan in top alert, fights off haze

Jakarta Post - July 12, 2002

Jakarta/Medan -- West Kalimantan Governor Aspar Aswin declared his province on top alert on Thursday, urging local governments to tackle forest fire outbreaks which have been blanketing the province in a haze for the past week.

He demanded all government institutions take concrete action to fight forest fires which were causing health problems to people living in the provincial capital of Pontianak.

Last week, limited visibility because of the haze forced the cancellation of several flights in and out of Pontianak.

Efforts should focus on residential areas, Aspar was quoted as saying by the SCTV television station.

Environmentalists said the government should crack down on illegal loggers and plantation owners who contributed to the haze problem.

Although natural causes are behind many of the forest fires, forest encroachers, illegal loggers and plantation owners often clear forest land by burning.

Though illegal, such clearing methods remain popular. In particular amongst forest encroachers and illegal loggers, whose activities have risen since the late 90s.

In North Sumatra, people in the provincial capital of Medan have, for the past week, been waking up to smoke from forest fires from neighboring towns. The haze from forest fires in three areas covers Medan, limiting visibility to 2,000 meters.

The head of data management and weather analysis at the Meteorology and Geophysics Agency (BMG), Firman, said that the first fires were lit around July 8 and now numbered 180.

He said forest fires occurred in North Sumatra, Riau and Malaysia. In North Sumatra, hotspots were detected in the regencies of Asahan, Labuhan Batu, South Tapanuli and Mandailing Natal. While in Riau, hotspots were detected in the Bengkalis and Indragiri regencies.

Firman said forest fires in the eastern coast of Sumatra were common during the dry season. Last year, the BMG identified 656 hotspots in North Sumatra. But as the wind was coming from the southeast slowing around Medan, the haze had began to collect around the city, he said. The city itself is flanked by mountains.

Head of the North Sumatra Ministry of Forestry, Darori, said his office could do little to prevent the annual forest fires. "We do everything we can every year, but it seems as if forest encroachers are faster and smarter in burning down forests," he said.

Forests have also become a source of contention with neighboring countries. Singapore, which practically has no forest, and Malaysia are frequent victims of haze from forest fires in Sumatra. Since the great forest fires in 1997, the three countries have stepped up efforts to jointly battle forest fires with Malaysia often sending its fire troops to help their Indonesian counterparts.

West Kalimantan haze trips up flight schedules

Straits Times - July 9, 2002

Jakarta -- A choking and dangerous haze that has been blanketing the Indonesian city of Pontianak in the early morning has caused delays in flight arrivals and departures, officials said yesterday.

An airport official at the city in West Kalimantan, said one landing was delayed yesterday and about six flights were delayed over the weekend.

Visibility over Pontianak was a mere 50 m early in the morning but improved drastically later due to strong winds, said the meteorology office.

On Friday, health officials handed out up to 1,000 smog masks to drivers. Many residents have been complaining of sore eyes and respiratory problems, the state Antara news agency said.

The meteorology office said it had not rained in the area for at least a week and the thick haze had occurred daily in the early hours. It added that the smoke came from the use of fire to clear land around the city.

Environmentalists have said although the haze lasts only a few hours a day, it has high levels of dust and other particles which are dangerous to health.

Indonesia has banned land clearing by fire since 1999 following widespread forest and ground blazes in 1997-98 that sent haze over large parts of South-east Asia -- causing serious traffic and health hazards.

But fire remains the easiest and most cost-efficient way of clearing land, and Indonesia's millions of small farmers cannot afford more expensive clearing ways.

Such economic considerations weigh on the minds of officials who enforce clean-air laws and crack down on fire-starters.

Officials ignore warnings on real environmental threats

Jakarta Post - July 8, 2002

Bambang Nurbianto, Jakarta -- The city administration have turned a deaf ear to the warnings of experts that future floods could be worse if they fail to maintain or even expand the number of green areas in the city.

Planners, environmentalists and other experts often link the problem of flooding to the lack of green areas in the city as violations of the principles of environmentally friendly development continue.

"It is typical of the city officials that they always try to pursue short-term benefits as much as possible without considering the long-term problems that result," said Ahmad "Puput' Safrudin of the Jakarta branch of the Indonesian Forum for the Environment (Walhi).

Puput was commenting on the planned development of a new business center in a 40-square-meter area of Senayan that comes under the control of the Senayan sports complex authority in Central Jakarta, and which was originally zoned as a public, green area.

There have been a number of controversial projects constructed in the Senayan area, including the Mulia Hotel, Plaza Senayan and Taman Ria Senayan.

Governor Sutiyoso has agreed to reconstruct the fire-razed flea market in Taman Puring in South Jakarta, whose location according to the 2010 city master plan is supposed to be a green area. He also approved the construction of a controversial sports mall in Kelapa Gading, East Jakarta, that was originally zoned for social and public facilities.

Chairman of the Jakarta chapter of the Indonesian Association of Planners (IAP) Abdul Alim Salam said the city would eventually pay an expensive price for the administration's lack of commitment to the environment.

If the development of a business centers in Senayan continued, it would cause environmental problems. But more problems would arise if the city needed more land for sports facilities in the future, he said.

Puput said the administration should expand the green areas in the city from the present nine percent to about 14 percent of the total area of Jakarta as mandated by the city master plan up to 2010.

"How can the city administration increase the number of green areas if it continues to violate the land use policies set out in the city master plan," said Puput, adding that the ideal extent of green areas should be 30 percent of the total area of the city.

Wicaksono Sarosa, an executive director of the Urban and Regional Development Institute (URDI), said that worse flooding would not be the only consequence of the dwindling green spaces.

The city would become hotter due to the loss of green spaces and because more people would buy air conditioners. "So, those who suffer most will be the people who are not able to afford air conditioners," said Wicaksono.

For endangered apes, a suburban sanctuary

Melbourne Age - July 8, 2002

Catharine Munro -- To walk into the world of Yunus Makasau is to enter a wonderland of exotic creatures stolen from across the -- vast and sprawling Indonesian archipelago.

Mr Makasau is engaged in the risky work of confiscating endangered animals from Indonesia's rich and powerful and returning them to the wilderness.

"I have often faced police and military officers who threaten me with their guns, so I am not scared any more," the 51-year-old forestry officer said.

"I receive a lot of threats directed both to me personally and to my family. [But] the threats usually come from traders who don't like having their animals confiscated."

At the Nature Protection and Conservation Office on the outskirts of Jakarta, he runs a government compound holding owls and gibbons from Sumatra, honey bears from Borneo and birds of paradise and pig-nosed turtles from Papua.

Most intriguing are the pensive orang-utans, whose hands seem to reach out for the reassurance of touch, as well as for food. One, 10-year-old Edo, is being trained not to spit, a habit he learnt from his keepers at a private zoo in north Jakarta. Orang-utans share 97 per cent of their DNA with humans.

The few animals still in the wild -- orang-utans are very slow breeders -- are studied for evidence that they may be capable of developing rudimentary cultures. But Asia's only ape is dying out. The Orang-utan Foundation claims their numbers have fallen from 25,000 to about 15,000 in the past decade.

According to World Bank, their entire habitat of lowland forests on the islands of Sumatra and Borneo will be wiped out in the next 10 years.

Bushfires and illegal logging have increased the rate at which animals are being taken, particularly since Indonesia's economic crisis in 1997.

The cash-strapped government cannot provide the forestry department with the support its officers need to enforce Indonesia's laws against stealing protected species.

The officers have been funded since 1998 by the Gibbon Foundation, a Swiss conservation agency. But confiscated animals comprise just a few of Jakarta's stolen animals.

Most reside in cages in the lush gardens of Jakarta's ultra-rich. The officials who are supposed to protect Indonesia's extraordinary natural heritage are the most enthusiastic poachers, conservationists say.

An orang-utan fetches up to $1800 in the seedy markets of Jakarta. The price rises to $9000 in the black markets of Taiwan and Japan and to $54,000 once they reach the United States.

Health & education

HIV infection via transfusions on the rise

Jakarta Post - July 12, 2002

Debbie A. Lubis and Muninggar Sri Saraswati, Jakarta -- Most people still think that the spread of HIV/AIDS here is mainly caused by the sharing of syringes -- usually between drug users -- and unsafe sex. However, one may also be infected by HIV/AIDS via a blood transfusion.

The World Health Organization (WHO) estimates that 5 percent to 10 percent of people with AIDS are infected via blood transfusions.

In Indonesia, the prevalence of HIV among the recipients of blood donations sharply increased, from 0.002 percent in 1992 to 0.15 percent in 2000, according to the Ministry of Health.

Official data shows that there are 120,000 people living with HIV/AIDS in the country.

The Indonesian Red Cross (PMI), as well as most hospitals here, carries out an initial screening to check the blood for possible HIV/AIDS using a specific test to detect the virus antibodies, known as the Elisa test.

Chairman of the Blood Transfusion Unit at PMI Sujudi and AIDS expert to Cipto Mangunkusumo General Hospital (RSCM) Dr Noroyono Wibowo admitted, however, that the Elisa test could not guarantee that the blood that had passed was HIV/AIDS-free.

Sujudi explained how the Elisa test might fail to recognize possible HIV/AIDS antibodies. "Failure is possible due to low- quality liquid reagents used in the test or due to human error," he told The Jakarta Post in his office.

Personal adviser to the chief executive officer of Siloam Gleneagles hospital in Karawaci, Tangerang, Eva Fifenly told the Post that the hospital always checked its blood intended for transfusion. It also double-checked the blood taken from the Indonesia Red Cross (PMI). "We always check the blood here using a method known as the rapid test," she said.

This is similar to the Elisa test. Should the test reveal the possibility of HIV/AIDS, at the patient's request the hospital will screen the blood using the Western Blot test. That and the Polymerized Chain Reaction are two tests that can confirm the presence or absence of HIV/AIDS.

The management of Pondok Indah hospital and the Metropolitan Medical Center, both in South Jakarta, refused to make any comment. However, a doctor at Pondok Indah and a member of staff at MMC separately told the Post that the hospitals deployed a similar procedure to test blood.

"That's an international standard observed by most hospitals in the world," the doctor, who wished to remain anonymous, said on Thursday. While the Elisa test costs only Rp 47,000 (US$5.20), the Western Blot costs Rp 522,000 per test and the Polymerized Chain Reaction is Rp 1,250,000.

The price of a 250 cc pouch of blood from PMI for private hospitals is Rp 130,000 while that for state hospitals is Rp 65,000. The price includes the cost of screening.

A man who was recently hospitalized at Pondok Indah regretted that he had not been informed about the test in the first place. "I wouldn't mind paying a considerable sum to avoid the risk of getting infected with HIV," he said.

Since 1992, PMI has been screening donated blood for possible HIV/AIDS using the Elisa test. Last year the Elisa test enabled PMI to discover that about 100 of a total 1.2 million pouches of blood here contained possible HIV/AIDS.

"Should the test indicate that the sample is HIV-positive, we will send it to be rechecked using the Western Blot test at the Ministry of Health or to RSCM for the Polymerized Chain Reaction as we can't afford the equipment necessary for the tests," Sujudi said.

Cheap drugs beyond reach of HIV carriers

Jakarta Post - July 10, 2002

Debbie A. Lubis, Jakarta -- People living with HIV/AIDS in Indonesia are having difficulty gaining access to imported live- saving antiretroviral drugs because of the exorbitant price of patented drugs and a limited supply of the generic version.

Health experts said a package of antiretroviral drugs available in drugstores across the country, which were supplied by large pharmaceutical companies in Europe and the US, costs HIV sufferers Rp 8 million ($US900) to Rp 10 million. A package is equivalent to a one-month treatment.

Meanwhile, cheaper generic versions of the drug, mostly imported from India, are available only at the HIV/AIDS study center at the University of Indonesia and Cipto Mangunkusumo General Hospital. The cost of the one-month treatment package of the generic drug is Rp 750,000.

Samsuridjal Djauzi, an immunologist at the study center, said on Tuesday that no other parties in the country were importing the generic antiretroviral drugs except for the study center, which had started importing them last year.

"It all came from our own initiative. At that time, we felt sorry for poor people with HIV/AIDS who could not afford patented drugs. Then our doctors pooled their money together to bring in the generic drugs from India," said Samsuridjal, who is also president of Dharmais Cancer Hospital.

Because of limited funds, the center can only provide drugs for 200 HIV carriers, which is far below meeting the demand. Every month, he said, 10 new HIV carriers are put on a waiting list to receive generic drugs from the center.

Despite the scarcity of affordable antiretroviral drugs, the government has not yet made any real moves toward helping low- income people living with HIV/AIDS. Nevertheless, sources said that the government had planned to appoint a state pharmaceutical company, PT Indo Farma, to import generic versions of the drug.

Although Indonesia has no plan to produce its own life-saving drugs any time soon, the trade-related aspects of the Intellectual Property Rights (TRIPS) agreement has given new flexibility to allow countries to override patents for the sake of public health.

Mawarwati, the secretary-general of the National Agency of Food and Drug Control (BPOM), said that based on such flexibility, Indonesia would be able to have access to antiretroviral drugs at affordable prices.

"We can produce the drugs here, but we have to import the raw materials. We can import them from sources that offer cheap prices with the same quality as patented ones," she said.

Meanwhile, the study center manager, Kurniawan Rachmadi, said Indonesia would be liable to be sued in the courts for infringing the companies' patents, unless it declares an HIV/AIDS crisis. "The declaration allows us to override patents if we state that the epidemic has reached an extreme state of urgency to allow access to the drugs," he said.

Rachmadi was pessimistic that the country could declare a crisis any time soon as the government was careless in collecting data. "Their numbers do not represent the real figures," he told the Post.

According to an official estimate, Indonesia has 120,000 people living with HIV/AIDS.

Antiretroviral drugs do not cure AIDS but prolong the life expectancy of sufferers, Samsuridjal said. "It prevents the virus from replicating and improves the patient's immunity," he said.

He said there were many kinds of antiretroviral drugs and should be consumed in three combinations because taking only one kind would create a resistance to the virus. He advised people with HIV/AIDS not to stop taking the drugs.

"It is similar to diabetes patients who take medicine for their entire life. Antiretroviral therapy requires discipline and continuity," he said.

Shockingly high childbirth deaths in Indonesia

Straits Times - July 9, 2002

Robert Go, Jakarta -- Every 30 minutes, one Indonesian woman dies while giving birth and out of 100 babies born here, six won't reach the age of five -- statistics that show the sorry state of the country's health-care system.

Unfortunately, given its tight financial position, the government is likely to continue allocating only about 2 per cent of its yearly budget to the Health Ministry.

And health-care programmes here would still be dependent for years on aid from foreign donors such as the United States Agency for International Development or the United Nations' various arms.

Ms Wastidar Musbir, head of the Indonesian Midwife Association, said that while maternal and infant mortality rates had declined in recent years, Indonesia's numbers remain the highest in Asia.

"It is a very sad situation. Ninety per cent of births here should be normal births, but many women die because of lack of basic medical monitoring and care," she said.

Most of the deaths can be avoided easily, experts argued. Dr Biran Affandi, chairman of the Indonesian College of Obstetrics and Gynaecology, said that 60 per cent of maternal mortality cases occurred after excessive haemorrhaging following childbirth.

He said: "Insufficient pre-natal monitoring, inadequate care during the birth process itself, poor facilities at clinics -- all contribute to our inability to deal with health complications that are easily dealt with in other countries."

Part of the problem is that many Indonesian women do not see anything wrong with going to untrained dukuns or witch doctors when they go into labour. Most come from communities where dukuns have traditionally taken care of such issues. Dukuns handle up to 80 per cent of childbirths in remote rural areas.

Another factor is money -- dukuns charge less than clinics or trained midwives, and sometimes would accept goods instead of cash in exchange for their services.

The biggest obstacle, however, remains the fact that Jakarta gives a low priority to the well-being of the people, and does not spend enough money in ensuring sufficient health care for all.

Dr Azrul Azwar, director-general for people's health at the Ministry of Health, said: "We already have several motherhood programmes, but yes, these don't reach everyone. The Health Ministry should get a bigger share of the national budget. But frankly, government attention to health remains low. This will continue unless there is a shift in the attitude of government officials."

Some experts already warned that health initiatives would be the first to go as local governments, which are now empowered under the regional-autonomy programme to control fully its expenditure choices, try to make do with their meagre budgets. All this could result in health programmes' greater dependence on foreign money.

Ms Fitri Putjuk, communications adviser for the USAid-funded Siaga maternity programme, said: "We still cannot count on government funding. Most money for these kind of projects came from foreign sources. Indonesia is definitely playing around with its most important asset -- the future generations."

Childbirth:

• One woman dies every 30 minutes
• Once every 30 minutes, an Indonesian woman dies while giving birth.
• Out of 100 babies born here, six won't reach the age of five.
• Sixty per cent of maternal mortality cases occurred after excessive haemorrhaging following childbirth.
• Witch doctors or other traditional birth attendants deal with 50 per cent of all childbirths. That figure reaches as high as 80 per cent in remote rural areas.

No room in school for thousands

Jakarta Post - July 9, 2002

Jakarta -- With the new academic year drawing near, some 13,000 junior high school graduates across South Kalimantan are facing the possibility of having to give up their formal education due to a limited number of places in senior high schools, an official said.

The head of intermediate education at the province's education agency, Humaidi Syukeri, said there were an estimate 22,000 places in both state and private senior high schools for the coming academic year, which started next Monday. This figure, he added, was far lower than the 35,000 who were due to graduate from junior high school.

"We are not certain about their future, whether they will be able to continue their studies in senior high school as their number exceeds the number of places in the senior high schools," Humaidi said in Banjarmasin.

He explained that the number of senior high school graduates usually was broadly similar to the number of places to be filled by new students.

"Many junior high school graduates have yet to enroll in, or are unable to qualify for, senior high school. They could choose Islamic boarding schools as an alternative," he added.

Abdullah Amin, the head of the provincial education agency, suggested that parents avoid forcing their children to enter popular schools.

He said many parents complained about the limited number of places mainly because they insisted on choosing popular schools for their children.

"In principle, all schools are the same, none of them should be more popular than others. All schools are treated equally by the government," he said.

He warned that the popular schools could not guarantee better results if the students were not willing to work hard.

Kids' food supplements popular despite warnings

Straits Times - July 8, 2002

Jakarta -- Traditional food supplements for children are selling well in Indonesia's capital city with parents convinced of their benefits despite many containing ingredients not suitable for children's consumption.

But these supplements have already received approval from the Food and Drug Control Agency (BPOM) despite warnings by doctors and consumer groups about the products. "I need them to keep my children in good health," said Ms Sulistyawati, 32, on Saturday.

She was buying some jamu, a traditional medicinal drink, for her two children at a kiosk in Pasar Pramuka, East Jakarta. She paid 5,000 rupiah (S$1) for a packet, which contains 10 sachets. "This jamu is good for my children as it gives them a good appetite. It also stops them getting worms," she said confidently.

However, Dr Marius Widjajarta of the Indonesian Health Consumers' Empowerment Foundation warned parents not to give food supplements to their children without consulting doctors. He warned they must be alert for food supplements claiming to be universal panaceas or able to increase intelligence. "It's nonsense. No food supplement or medicine can do that," he said.

He criticised the BPOM as most of the children's supplements had been registered with the agency even though some contained substances that children should not consume, such as the artificial sweetener cyclamate.

Religion/Islam

University lecturer leads Muhammadiyah Youth

Jakarta Post - July 11, 2002

Edith Hartanto and Yogita Tahilramani, Surabaya -- Still shy but a bit surprised, university lecturer Abdul Mukti emerged as champion on Wednesday when he was elected leader of Muhammadiyah Youth, replacing outgoing leader Imam Addaruqutni.

The election was the main agenda item of the four-day Muhammadiyah Youth congress at the Asrama Haji in Sukolilo here, which closed on Wednesday.

Mukti, a master of education graduate from Flinders University of South Australia, who has no party political affiliation, won 792 votes, a mere 68 more than National Mandate Party (PAN) official Suyoto, a university rector, during the three-hour voting session that began early on Wednesday morning.

Mukti's election reflects participants' determination to distance Muhammadiyah Youth from political party influence.

A 70 year-old organization, Muhammadiyah Youth is under the aegis of Muhammadiyah, one of the most prominent and puritanical Muslim organizations in Indonesia.

During the 1999 general election, the majority of Muhammadiyah's votes went to candidates from PAN, which is led by People's Consultative Assembly (MPR) Speaker Amien Rais, a former Muhammadiyah chairman and Muhammadiyah Youth leader.

Wednesday's voting session went smoothly despite a bomb hoax that temporarily shook supporters of the 13 leader hopefuls prior to voting.

Mukti, who comes from the small Central Java village of Kudus, secured major support from delegates representing Central Java, Yogyakarta, part of Sumatra, West Java, Banten and West Kalimantan. According to Muhammadiyah Youth official M. Saleh Tjan, apart from his "plus point" of having no political party affiliation, Mukti was deemed capable of guiding Muhammadiyah Youth.

"He may be low-profile, but he is wise and firm. I believe he will be able to lead the Youth to concentrate on formulating social-oriented programs, to help with the nation's current social problems," Saleh said. Mukti said that he believed he could motivate members to really understand and contribute ideas to the problems of the nation.

Formulating a national program was tough considering that most members had hardly ever discussed crucial issues facing the nation such as labor, health, education, gender, or even the amendment of the 1945 Constitution, he said.

He added that even though he had no wish to enter politics and was happy with his teaching job at the Walisongo Institute of Islamic Studies, he would not prevent Muhammadiyah Youth members from expressing their political aspirations.

Muhammadiyah, established in 1912 as a modern organization while maintaining its commitment to the Koran, reaffirmed its desire recently to avoid practical politics and embrace local cultures to affect social changes.

The 30 million-strong Muhammadiyah has made modern contributions to Islamic religious thought.

Muhammadiyah is different from the Nahdlatul Ulama, another prominent Muslim organization, which is much more tolerant and adopts various pre-Islamic traditions as a pragmatic way of spreading Islam, mostly in Java.

Some recommendations of the 12th Muhammadiyah Youth Congress

1. Push MPR members to avoid deadlock during the amendment of the 1945 Constitution.
2. Push the government to prioritize implementation of the reform agenda, particularly of the judiciary.
3. Urge the Indonesian Military (TNI) and National Police to continue to coordinate their offers and engage in dialog to achieve national stability, particularly in the riot-torn province of Aceh. Push the government to abort any possible plan for introducing martial law in Aceh.
4. Push local administrations to fully utilize the 1999 Law No. 22, on regional autonomy, for the development of regional economies.
5. Push the government to prioritize the development of the national education system and its quality.
6. Push the government to encourage non-Islamic schools to provide religious education in accordance with the religion of the students. The government should take action against non- Islamic schools that fail to provide Islamic studies for Muslim students studying there.

International relations

Little hope put on Mega's peace broker role

Straits Times - July 12, 2002

Marianne Kearney, Jakarta -- Indonesia's offer to act as the honest broker between the two Koreas, made during North Korean number two leader Kim Yong Nam's first visit here, has been greeted with scepticism.

Observers point out that President Megawati Sukarnoputri has only the slimmest of chances to ease tensions and revive dialogue between the two feuding neighbours.

Yesterday, the visiting president of the North Korean Parliament held "intense discussions" with Ms Megawati, Foreign Minister Hassan Wirayuda told reporters after the meeting at the presidential palace.

"As a good friend, Indonesia offered how we can help in the effort to revive dialogue between the two states towards reunification of North and South Korea and also towards resolving the conflict in that region," he said.

Indonesia has promoted the visit, which follows a visit by Ms Megawati to Pyongyang in March, as a first step in a dialogue between the two Koreas.

During her visit, Ms Megawati met North Korean leader Kim Jong Il and urged North Korea to resume a dialogue with the world and delivered a message from South Korean President Kim Dae Jung.

However, observers and diplomats here doubt that any peace initiatives will emerge from Mr Kim Yong Nam's visit or even that it indicates North Korea's willingness to restart talks.

"There is no particular meaning behind why Kim Yong Nam is visiting Indonesia. Last year he visited all the other South-east Asian countries so perhaps it is just part of that," said Mr Kim Eun Sok, a diplomat at the South Korean embassy.

He said that although he did not doubt the sincerity of Jakarta's efforts, he saw no signs that North Korea was ready to come to the negotiation table. Tensions between North and South Korea increased sharply at the end of last month when their navies clashed close to their maritime border.

Observers also said Indonesia's desire to act as a peace broker appeared to originate in Ms Megawati"s "emotional' attachment to her father and founding president Sukarno's diplomatic policy. They say the memories of her visit to North Korea as the daughter of then president Sukarno, when she first met Kim Jong Il, are driving the peace overtures more than concrete ideas on how to broker peace.

Another diplomat doubted the peace initiatives were serious, saying that Ms Megawati and her government were far too consumed by domestic politics and trying to control Parliament ahead of the 2004 elections to focus on international affairs.

Among other things, she is dealing with the fallout of a major graft probe involving the Indonesian Speaker, factionalism in her own party, a separatist movement in Aceh and a sectarian conflict in the Malukus and a lacklustre economy.

Western diplomats also noted that although the two nations had friendly ties since the 1960s, it was strange that Indonesia -- which has an anti-communist policy and only last week arrested a vendor for selling T-shirts promoting communism -- is promoting peace with one of the world's last communist states.

Indonesia has little to gain from the visit, say diplomats, but the impoverished North Korea might be hoping to promote economic ties. Jakarta and Pyongyang yesterday signed two memorandums of understanding to avoid double taxation and cooperation in science and technology.

Mr Hassan said they also talked about working together in international bodies such as the Asean Regional Forum.

Aceh martial law could set back prospects for US military aid

OneWorld (US) - July 10, 2002

Jim Lobe -- If Indonesia declares martial law in oil-rich Aceh province, as suggested last weekend by top military officials, the government of President Megawati Sukarnoputri may find it more difficult to resume military-to-military ties with the United States, according to analysts in Washington.

Such a declaration, especially if it is accompanied with increased repression, will also hurt chances for a negotiated solution to the long-running conflict between the Acehnese and the Megawati government, who have been engaged in peace talks in Geneva for several months, although no progress on key issues of autonomy and revenue-sharing has been reported.

"The talk of martial law is pretty ominous," said Mike Jendrzejczyk, an East Asia specialist at Human Rights Watch (HRW) in Washington. "Nobody seriously believes a military solution is possible, and any increased offensive will only further distance Jakarta from the Acehnese." Speculation about Jakarta's intentions for Aceh is intensifying as Megawati's top security minister, Susilo Bambang Yudhoyono, who last week for the first time labeled the Free Aceh Movement (GAM) a "terrorist" group, leads a government delegation to the northern province to determine what to do.

The trip, and Bambang's latest statements, follows a hardening of the government's stance against GAM and an intensification of the conflict, including several high-profile murders and GAM's abduction of 18 athletes and sailors over the past month. GAM, which has waged a 26-year struggle for independence from Jakarta, released all 18 last weekend, claiming that they had been detained on suspicion of being spies.

The latest developments come as the Bush administration is pressing Congress to renew military ties with the Indonesian armed forces (TNI) that were substantially reduced during the 1990s and cut altogether in 1999 when TNI-organized and -armed militias devastated East Timor after its inhabitants voted overwhelmingly for independence in a United Nations-backed referendum. The former Portuguese colony, which was invaded and annexed by Indonesia in 1975, formally gained its independence earlier this year.

Under current US law, Washington can resume military-to-military relations, such as training, only when Jakarta meets several conditions, including bringing to justice those responsible for the mayhem in East Timor, as well as other indications that the military has been brought under civilian control and has improved its human rights record.

But the Pentagon, particularly deputy defense secretary Paul Wolfowitz, who served as US ambassador to Jakarta in the 1980s, believes that the Indonesian military has a key role to play in the Bush administration's war on terrorism. Washington believes that members of the al-Qaeda network have raised money and pursued some other activities in Indonesia, which is the world's largest predominantly Muslim nation.

The administration has asked Congress to approve financing for a new "command and control" unit that would act as a peacekeeping force in ethnic and religious conflicts that have arisen in various parts of the archipelago, as well as the supply of certain "non-lethal" items, such as radios. It also has signaled an interest in renewed training of TNI officers at a proposed anti-terrorism institute to be established in Hawaii.

So far, however, the Pentagon has not been able to get its way, as both houses of Congress, while sympathetic to the administration's concern about radical Islamist activity in Indonesia, have agreed to provide aid only to the Indonesian police and rejected the proposal for training and arming the peacekeepers.

While most opposition to renewing military ties comes from Democratic lawmakers, they have been joined by some on the Republican right who are particularly concerned about the TNI's human rights record and reports that army units have provided aid to radical Islamist groups involved in fighting between Christian and Muslim communities in the Maluku Islands.

Human rights advocates are particularly worried about the conflict in Aceh, where Indonesian forces have waged a brutal counter-insurgency campaign that has included disappearances and summary executions of both suspected GAM members and others, including rights activists and teachers. GAM, too, has been criticized for summary executions of suspected informers and prisoners and threatening non-Acehnese communities, leading thousands to flee the province.

While Bambang himself is believed to favor a state of civil emergency -- that would give the local governor powers to order arrests, ban the media, and restrict assemblies or demonstrations -- over a declaration of martial law, even that, according to experts, is likely to reduce chances for negotiations. Sidney Jones, Indonesia director of the Brussels-based International Crisis Group, said such a move would at the least cause "greater resentment" towards the government.

But it would also harden opposition to restoring military ties in Congress, according to one aide, who asked not to be identified. "Despite the government's efforts, it would be difficult to paint the GAM as a target in the war on terrorism that would justify US support and it would add to fears that we were backing an abusive military," he said.

Aceh violence 'threatens US ties'

BBC News - July 9, 2002

Renewed clashes in the troubled Indonesian province over the past few days have also claimed the lives of three civilians in a grenade blast, and three more rebels, officials said.

Indonesia's Security Minister Susilo Bambang Yudhoyono is visiting the northern province to decide whether to institute tougher measures to end the 26-year-long separatist insurgency.

But an American official in Indonesia's capital, Jakarta, warned that the spiralling violence could harm attempts to restore full military ties between the two countries.

Emergency talks The seven rebels from the Free Aceh Movement (GAM) were killed when government troops raided a rebel camp in eastern Aceh, a military spokesman said.

"After a 15-minute gun battle, troops combed the area and found one woman and six men dead," he said. A spokesman for the separatists confirmed to the Associated Press news agency that several fighters had been killed, but said soldiers had also been killed in the exchange.

The recent deaths came as Mr Yudhoyono holds talks to decide whether to declare a civil emergency -- one step from martial law.

Last week, Mr Yudhoyono labelled GAM as "terrorists" in what analysts said could be a hardening of the government's attitude against the separatists.

But at the beginning of his week-long visit to Aceh, the security minister said peace talks could continue, but armed violence would not be tolerated.

On Wednesday, Mr Yudhoyono was due to discuss the security situation with the province's police and military chiefs.

Any increase in military involvement in Aceh could harm attempts to strengthen ties between Indonesia and the US, an American official warned.

US Congress unimpressed

Before full military ties can be restored, the US Congress must agree that Indonesia has done enough to account for what happened in East Timor when pro-Jakarta militias battled those seeking independence.

The unnamed senior US official in Jakarta said a rising death toll or military action in Aceh would not be welcomed by legislators in Washington. "This could disrupt very sensitive efforts to deal with the military-to-military relationship," he said, according to Reuters news agency.

Fresh separatist violence occurs almost daily in the province of Aceh with the death toll from 26 years of fighting estimated to be more than 10,000. Various ceasefires have been agreed but never held.

Politics blamed for Indonesia's delay in posting envoy

Canberra Times - July 9, 2002

Jakarta -- The post of Indonesian ambassador to Australia remains unfilled because of a political struggle in Jakarta over who appoints the country's diplomats.

Indonesia's Department of Foreign Affairs has refrained from nominating a new ambassador after the outgoing envoy, Sudjadnan Parnohadiningrat, was last month recalled early to be promoted in Jakarta.

"I don't want to over-analyse this or add an element of intrigue to it ... the thing is we just need to find a nominee and they [the parliament] will process it," department spokesman Marty Natalegawa said.

He said the Indonesian mission in Canberra was being run by Charge d'Affaires Imam Cotan, an arrangement similar to missions in London and Tokyo.

But retired Indonesian diplomats attributed the hesitance to nominate an ambassador to Canberra to a stand-off with the parliament over who controls appointments.

Last month parliament's Foreign Affairs Commission rejected seven of the department's 27 candidates, including an ambassador to New Zealand, on the grounds they were either too old or not up to scratch.

Parliament has had a say in ambassadorial appointments -- representing both Indonesia and other countries -- since a constitutional amendment in 1999 said the parliament must consider candidates.

The new arrangement led to a delay in the arrival of Australia's current ambassador to Indonesia, Ric Smith, by several months. The rejection of candidates was a symptom of parliament imposing its powers on the government after the fall of Suharto in 1998, according to international law specialist and former diplomat Hasjim Djalal.

"Paying attention to the DPR's opinion now means that the opinions from the DPR must be obeyed by the Government," Professor Djalal, who has served as ambassador to Germany and Canada, said.

"If you ask me personally, we should have an ambassador in Australia, it's a very important country. It's awkward in terms of diplomatic relations ... there should have been an ambassador as soon as possible."

Canberra is widely acknowledged as a difficult and important posting for Indonesia's diplomats. Last year, ambassador Sudjadnan was put to the test during the Australian election campaign, dealing with the issue of boat people.

Economy & investment

Indonesia moves to protect sugar industry

Radio Australia - July 9, 2002

The Indonesian government has raised the import duty on sugar by up to 30 per cent to protect local sugar cane farmers from cheaper imports.

The rise follows widespread violent protests by sugar cane farmers against cheaper imports.

Indonesia in 2000 imported 1.2 million tonnes of sugar, mainly from Thailand.

Jakarta's new titans

Business Times - July 15, 2002

Michael Shari, Surabaya -- When Indonesia's President Suharto fell from power in 1998 and the business empires of his cronies melted down, young Hary Tanoesoedibjo saw a chance to snap up cheap businesses.

Four years later, the 36-year-old CEO of an obscure investment bank in the gritty East Java port of Surabaya has risen to prominence by using his brokerage fees to buy and sell companies that had been stripped from the cronies' shipwrecked conglomerates. The dairy concern Indomilk and the SCTV television station are among his holdings.

Then, in April, Tanoesoedibjo snagged the biggest prize of all: He took control of Bimantara Citra, the Suharto family's flagship holding company, buying most of the stock from Suharto's second son, Bambang Trihatmodjo.

Tanoesoedibjo is a leading figure in a new generation of young Indonesian tycoons. They took advantage of the crisis by betting against the crowd and investing in a diverse range of businesses, from media to finance, consumer goods to luxury brands. These men and women in their 20s, 30s, and 40s are hardly independent entrepreneurs. Most represent the second or third generation of conservative, ethnic Chinese family-run businesses. Many are based in Surabaya, a center of Indonesian manufacturing. Their families survived the Asian crash of 1997-98 with plenty of cash on hand, usually because they ran export businesses whose revenues were in hard currency. Unlike their parents, they were educated in North America and Western Europe, so they were more inclined to take calculated risks during the crisis.

Now this brat pack is picking up where the Suharto family and its ill-fated friends left off. The cronies, taking advantage of connections with the dictator who held power for 32 years, built their businesses with cheap capital and state-sanctioned monopolies. Members of the new generation are not free of the taint of influence-peddling, either. But they are bringing in foreign capital and expertise and are not so reliant on the old, insider ways that dominated the Suharto era.

In most cases, these younger scions are taking over businesses in a deregulated environment, restructuring them, and putting them on a sounder financial footing. "There is a new breed coming up," says Sofjan Wanandi, chairman of the National Business Development Council. "They have started to take over the assets of the conglomerates. I think that's good."

The undisputed leader of the new generation is Tanoesoedibjo, who was born in Surabaya in 1965, the year Suharto came to power. Through a business associate in Surabaya, Tanoesoedibjo developed a personal relationship with Abdurrahman Wahid, who then ran the powerful East Java-based Islamic organization Nahdlatul Ulama and served as President of Indonesia from 1999 to 2001. After earning an MBA from the University of Ottawa in Canada, Tanoesoedibjo returned to Surabaya in 1989 to set up Bhakti Investama, an investment bank. Bhakti's capital base grew with help from George Soros, whose Quantum Fund bought a 15% equity stake in the bank, which it sold back to Tanoesoedibjo last year. After Wahid's election, Tanoesoedibjo developed top-level political connections in Jakarta. He thus got first dibs on assets taken over from failed Suharto-linked companies by the state-run Indonesian Bank Restructuring Agency (IBRA) to cover their debts. "Doors opened for Hary," recalls a Singapore-based distressed-debt expert who follows Indonesian affairs.

Tanoesoedibjo's crown jewel is Bimantara, which gives him control of three businesses he intends to spin off in initial public offerings: the Jakarta television station RCTI, a digital CDMA cell-phone network, and a lucrative franchise that leases aircraft to the archipelago's oil and gas industry. Bimantara also includes real estate holdings and tourist resorts on Bali. The company reported $185 million in revenue and $38 million in profits last year, and its stock price has doubled since January. "There is a lot of hidden value here," says Tanoesoe-dibjo. "The company's existing infrastructure is excellent."

Other young managers have pushed old companies in new directions. Prakasa Alim, 45, is managing director of Surabaya-based kitchenware manufacturer Maspion Group. Maspion is thriving since it took over Revereware and started manufacturing for famous brands such as Dansk and Tupperware. The Hartono family, which owns the Djarum brand of Javanese clove-flavored cigarettes, emerged from the crisis with a healthy balance sheet. In March, Budi and Bambang Hartono, the sons of the founders of Djarum, who now run the company, put up most of a $539 million bid for a 51% stake in Bank Central Asia. BCA, Indonesia's biggest private bank when it was owned by the Suharto and Salim families, was nationalized in 1998. The Salims are longtime government cronies.

Another prominent young business mogul is Hanny Sutanto, 46, who assumed control over a Surabaya-based family soap and detergent business after his father's retirement. He has won admiration for his prudent but aggressive strategy. Late last year, Sutanto's Wings Group led a consortium of three Indonesian companies, including Djarum, that purchased the Salim Oleochemical plant near Surabaya for $120 million from Salim Group. The plant refines palm and coconut oil for use in shampoos.

Other young business titans prefer more glamorous trades. Soetikno Soedarjo, 45, took a big risk during the financial crisis and acquired exclusive distribution rights to a group of luxury brands, including Ferrari and Maserati sports cars, and Harley-Davidson and Ducati motorcycles. Known as the Brand King, he already owned the local Bulgari jewelry store before the crisis. "Everyone said we were crazy, but we made it," declares Soedarjo. Last year, MRA Co., Soedarjo's holding company, raked in $100 million in revenues.

Then there is Francisca Liem, the 24-year-old grandniece of Liem Sioe Liong, patriarch of the Salim Group. She had just got her degree in French literature from Washington University in St. Louis last year when her mother, Maggie Halim, the patriarch's niece, recruited her to run Marmitria Raya Tirta, a Jakarta-based luxury-brands retailer. In late June, Liem opened Indonesia's first Hermhs boutique, exercising an exclusive license that her mother and her "silent" business partner, Martina Sudwikatmono, a relative of Suharto, had acquired in 1998. "I'm the new kid in town," says Francisca. "I'm learning the business from my mother."

Shadowing these new players is Indonesia's reputation as one of Asia's most corrupt business environments. Rumors circulate in Jakarta financial circles that Tanoesoedibjo is acting as a proxy for the Suharto family, that Budi and Bambang Hartono are fronting for the Salim family at Bank Central Asia, and that Hanny Sutanto represented the Salims in the oleochemical deal. Tanoesoedibjo and Sutanto deny these allegations, and the Hartonos have signed statements promising not to sell out to the Salims.

"We will watch what they do next after taking all these assets," says Sri Gunawan, an economics lecturer at state-run Airlangga University in Surabaya. "At the grassroots, the people say we are going to make the same mistakes again." The challenge for the new generation is to avoid those old temptations.

Indonesia's economic progress fragile, IMF rep says

Jakarta Post - July 10, 2002

Jakarta -- While Indonesia's economy has been making significant improvement in a number of key areas, progress remains relatively fragile, the chief representative of the International Monetary Fund (IMF) office in Jakarta says.

David Nellor told journalists on Tuesday Jakarta still needed to work on sustaining progress it has made in the past 12 months. He cited in particular the need for Indonesia to continue working in gaining investors' confidence.

"We see some momentum, but will this be sustained?" Nellor asked rhetorically, adding that a lot would depend not only on the global economic condition, but also on domestic reforms.

Pointing to the stronger rupiah, which has now moved to the region of Rp 8,500 to Rp 9,000 to the dollar, Nellor said Indonesia should not squander the opportunity presented. "This is a point of opportunity, and we have yet to transform it into growth," he said.

He recalled that Indonesia had been at this point before, at the start of the Abdurrahman Wahid's presidency in October 1999 when the rupiah was in the range of Rp 7,000 to Rp 8,000. "That was a lost opportunity," he said.

An IMF delegation is due in Jakarta later this month to make the next quarterly review of the economy, a prelude to the release of the next tranche of the IMF loan to Indonesia.

An IMF endorsement would send positive signals to the market, but lack of progress in several reform areas, particularly in the legal sector, could undermine investors' confidence.

The latest case to shake their confidence was the bankruptcy ruling against the local unit of the Canadian insurance giant Manulife even when the company was financially sound.

The Supreme Court last week overturned the ruling by the Jakarta Commercial Court, but the Manulife episode, along with several other controversial court rulings, has damaged Indonesia's reputation.

Nellor said gaining investors' confidence was crucial for Indonesia to maintain the progress it had made so far. "They need legal certainty," Nellor said.

Thomas Dawson, the IMF director of external relations who was in Jakarta yesterday, said Indonesia needed to improve the investment climate not only for foreign investors, but also more importantly, for the local investors.

Nellor listed Indonesia's macroeconomic stability, resulting from prudent fiscal and monetary policies, as a sign of progress. Interest rates have fallen, the rupiah's exchange rate have strengthened, investment funds have started coming back, and inflation has been kept low, he said.

Nellor said the rupiah had been gaining ground before the US dollar began to weaken globally in March. "There was an Indonesian dimension to this," he said.

Other economic indicators however point at the other direction, underpinning investors' lack of confidence.

Foreign direct investment as well as domestic investment both fell in the first six months of the year with officials laying much of the blame on controversial court rulings that discouraged investors.

Export revenues also dropped during the period, and Minister of Industry and Trade Rini Soewandi has attributed this to falling orders for manufacturing products because of labor conflicts besetting the industrial sector. Nellor said the government has made a number of improvements in several key reform areas, particularly in the administrative sector.

He listed the establishment of the oversight committee of the Indonesian Bank Restructuring Agency (IBRA), the completion of the audit of state enterprises, and tax reforms among progress that have rarely been highlighted.

On administrative reforms, the government had completed between 90 and 95 percent of the programs listed in the letter of intent (LOI) it signed with the IMF in September, he noted. On high profile reforms, the results have been mixed, he said.

While the sales of the Bank Central Asia, Indonesia's largest private commercial bank, by IBRA has sent positive signals to investors, delays in the government's planned privatization has the potential of harming confidence, he said, citing the example of the government's failure to privatize cement producer Semen Gresik.

The next IMF review would particularly look at the government's bank divestment program, privatization, a number of macroeconomic policies and IBRA's loan sales, Nellor said. Progress on some of these areas could help build investors' confidence, he added.J