Resurgent economy rises to the challenge
WITH THE ELECTION OF PRESIDENT MEGAWATI, DAUGHTER OF THE NATIONAL HERO SUKARNO, INDONESIA HAS ENTERED A NEW ERA. KNOWN FOR HER INTEGRITY, MEGAWATI HAS PROMISED A STRONG, UNITED, DEMOCRATIC COUNTRY THAT WILL CONTINUE EXPORTING ITS PROVEN OIL RESERVES OF FIVE BILLION BARRELS, WHILE DIVERSIFYING INTO SECTORS SUCH AS TEXTILES, IT AND TOURISM

MEGAWATI SUKARNOPUTRI,
President of Indonesia, has made political unity a priority.

In the international political arena, all eyes are on Indonesia. The fate of democracy in two overlapping parts of the world, Asia and the Islamic community, lies in the balance. With around 220 million people, Indonesia is the world’s fourth largest nation and the giant of South East Asia. Moreover, since 88% of the population follows some variation of Islam, it is also the world’s most populous Muslim nation. And therein lie the possibilities–the country has the potential to set a shining example of democratic pluralism for all Muslims and other South East Asian states.

All clouds have a silver lining, as they say, and the 1997 Asian financial crisis that set off Indonesia’s recent downward economic spiral has also brought about the possibility of political rebirth. After 30 years in power, the authoritarian regime of General Suharto began to crumble in the face of widespread unrest and disapproval. In 1998, President Suharto was forced to resign and chose his vice-president, B.J. Habibie, as Indonesia’s third president. Some 18 months later, after having abolished state control over the media, the reformist Dr. Habibie followed his predecessor into retirement–but not before keeping his promise of free elections. These were held in June of 1999 and Abdurrahman Wahid became Indonesia’s first freely elected president. His vice- president was Megawati Sukarnoputri, daughter of the much loved first president Sukarno (1945-67). The story doesn’t end there, however. Ongoing power struggles between President Wahid and his parliament ended in his impeachment last summer, and, on July 26, 2001, Megawati assumed the presidency.

The government predicts a 3-4% growth for 2002 rising to 6-7% for 2003 and 2004


BAMBANG KESOWO
BAMBANG KESOWO
State/Cabinet Secretary

During President Megawati’s inaugural speech, she stated that the government would prioritize economic recovery, political stability and law enforcement. She immediately made it clear that political unity, both internally within the government and on a national level, was a priority. Breaking with the past, she filled her new cabinet with reformists, market-friendly economists and surprisingly few politicians. Her state minister/cabinet secretary, Bambang Kesowo, is dedicated to improving internal cooperation within parliament and highlights the importance of an integrated policy. He explains, “I am convinced that our most immediate concern is carrying out the very real and very simple strategy of resolving internal political differences. I believe that once we are able to coordinate properly between ministries, everything else will follow smoothly.”

The political uncertainty and economic strains that have reigned in Indonesia since 1997 have understandably worn down voters and politicians alike, and both are eager for change. Mr. Kesowo is aware that patience is a scarce commodity in Indonesia at the moment but realizes that the new government must balance the pressures of high expectations with prudent, albeit slower, reform. “Legal certainty is important, as well as policy. Sometimes policy changes too quickly and creates an uncertain climate for the people,” he says. “We will first change the fundamental things that, according to our vision, do not contribute to national unity. But it is difficult to convince people that it is not necessary to go into a kind of race that will bring welfare to the local people in a year. Welfare must be planned and considered on a long-term basis, not short-term. There must be a coordinated and synchronized approach. This is important for the investor as well, since security and safety are their primary concerns. I have urged the government to enforce the law in spite of possible political consequences. If the law is the ultimate means, we must act in accordance with it. Political order is dependent upon this, as well as security and safety.”

Although it has only been a matter of months since the new government has been in power, they have already been able to achieve various objectives. “Most importantly, we have made strides in the relations between the executive and legislative arms of the government,” states Mr. Kesowo. “We have also been able to normalize relations with the International Monetary Fund, which had been frozen since early 2000.” Today, Indonesia is once again beginning to enjoy political stability. And this is good news not only for Indonesians, but for the rest of the world as well. After all, Indonesia is too big a country and too important internationally not to have the right person in the top job.

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