------- Forwarded Message Follows -------
To: sangkancil@malaysia.net
Cc: sk@malaysia.net
Date: Sat, 08 Nov 1997 08:48:26
Subject: [sangkancil] Soeharto and Co: it's time to give a little (fwd)
From: pillai@mgg.pc.my (M.G.G. Pillai)
Reply-to: pillai@mgg.pc.my (M.G.G. Pillai)
________________________________________________
This week's sponsors -The Asia Pacific Internet Company (APIC)
Business Internet Services. Some talk. Some do. We talk and do!
<http://www.apic.net> <mailto:info@apic.net> for instant info
________________________________________________
FORWARDED MAIL -------
From: dfiddle@mn.uswest.net (Dennis L. Fiddle)
Date: 07 Nov 97
Originally Posted On: alt.culture.indonesia
INDONESIA
Saturday, November 8, 1997
Soeharto and Co: it's time to give a little
By LOUISE WILLIAMS, Herald Correspondent in Jakarta
Like a spoilt child, President Soeharto's son Bambang Trihatmodjo
pouted across the front pages of Indonesia's newspapers this week,
announcing that all he had done was break the law - just like most
of the other executives heading Indonesia's banks.
The 44-year-old businessman, who heads a three-billion dollar
empire, was targeting his father's Finance Minister, Mr Mar'ie
Muhammad. He included the Andromeda Bank, in which Bambang holds a
25 per cent stake, in 16 banks wound up this week under the
conditions of the $US38 billion ($54 billion) IMF rescue package
for the Indonesian economy.
"There is a political move to disgrace my family," Bambang said.
Had President Soeharto known the details of the bank liquidations,
Bambang felt, he would never have approved such a public slap in
the face for one of his wealthy children.
Within two days of the Andromeda closure, the bank's directors
were in court filing a suit against Mr Mar'ie. Yesterday they were
followed by lawyers for Bank Jakarta, controlled by the
President's half-brother Probasutedjo.
Bambang appeared to be unconcerned that the bank had admitted
exceeding the legal lending limit by providing $US75 million in
depositors' funds to its shareholders, which include his Bimantara
group, as well as two other politically well-connected cronies,
the timber baron Mr Prajogo Pangestu, and businessman Mr Henry
Pribadi, a well-known patron of Melbourne's Crown Casino.
Bambang said the money was used to refinance his and Mr Pribadi's
giant petrochemical venture, Chandra Asri.
The spectacle of a member of Indonesia's first family publicly
rowing with the Finance Minister goes beyond the conflict over
Andromeda and provides a rare insight into the power-games which
have built Indonesia's corporate empires.
Bank depositors' funds are used to finance the personal ambitions
of the owners and directors, in a world in which proximity to
political power equals business access.
So widespread is the practice of exceeding the legal lending limit
that Bambang announced: "We admit the fault, but we know 90 per
cent of national banks must have violated the requirement." His
apparent expectation that his father should protect him reveals
the confidence the President's children have in their right to
preferential treatment.
But perhaps this dispute will signal the beginning of something
more important, which goes to the heart of the survival of the
Soeharto regime, and the legacy the aging President Soeharto will
leave behind. The currency crisis has forced economic reforms on
Indonesia which demand sacrifices from even the best-connected,
and challenge a form of capitalism based on power and connections,
not adherence to any set of rules or codes of conduct.
A battle is brewing within the political elite between those who
know they must change to survive and those bent on defending their
privileges, built during decades of economic growth when few
questions were asked as long as the national cake continued to
grow.
General Rudini, a former home affairs minister, this week publicly
countered Bambang by saying President Soeharto must have seen
Andromeda's name on the bank closure list. Like a growing number
of disaffected members of the elite, General Rudini believes it is
this kind of favouritism - which the empires of the children have
come to symbolise - which has dragged the credibility of Mr
Soeharto's New Order to an all-time low, and subverted national
goals in favour of personal gain.
Even Bambang's eldest sister, Siti "Tutut" Hardyanti Rukmana, came
out in support of the bank liquidations, fuelling speculation that
the first family was fighting amongst itself. Tutut's bank was not
touched by the reforms.
Professor Richard Robison, head of Murdoch University's Asia
Research Centre, was visiting Jakarta this week. "Things aren't
clear yet, but it would seem President Soeharto did agree [to the
bank closures]," he said. "We can only assume Soeharto realised
some aspects would have to be sacrificed to keep the goose alive."
Professor Robison, who has written widely on the links between
political power and business in Indonesia, said: "It would seem
some of the people who will be sacrificed will resist and groups
related to the first family will be split."
If Bambang continues to force the issue, he said: "It will give
real life to an anti-first family coalition."
Professor Robison told a seminar in Jakarta that the financial
meltdown in Indonesia showed that once an economy entered the
global marketplace it was impossible to avoid the disciplines
associated with the demand for transparency, public disclosure,
property rights, access to information and freedom of movement.
"Just as early forms of industrial capitalism in Britain and the
US were transformed from markets without rules dominated by
politically powerful industrial barons into highly regulated
systems, so Indonesia is being transformed."
THE key question now, Professor Robison said, was whether
Indonesia's elite would press ahead with reforms and "attempt to
reinvent themselves", or try to defend the old system.
For ordinary Indonesians there seems to be no choice but to suffer
the pain. About 2 million day labourers in the construction
industry have been laid off in the Jakarta region, and more
retrenchments are expected, along with inflation.
With forest fires still producing dangerous smoke haze across much
of Sumatra, Kalimantan and Java, and a severe drought preventing
rice planting, the national mood is grim.
Of President Soeharto's six children, Bambang can most afford to
sacrifice. The book Asia's Wealth Club estimated his holdings at
$US3 billion, compared with Tutut at $US2billion, youngest son
Tommy at $US600 million, eldest son Sigit at $US450million, and
the two quieter daughters, Titiek, worth $US200 million and
Mimiek, worth $US100 million.
This material is subject to copyright and any [Signpost]
unauthorised use, copying or mirroring is prohibited.
source http://www.smh.com.au/daily/content/971108/world/world3.html
-- dfiddle@mn.uswest.net (Dennis L. Fiddle)All news and information postings are in the public interest. The opinions expressed in the postings are those of the author and do not necessarily reflect the opinion of the sender.
-________________________________________________
List Owner: M.G.G. Pillai <mailto:pillai@mgg.pc.my> Free Homepages on malaysia.net - send blank <mailto:homepage@malaysia.net> Check out the malaysia.net web site on <http://malaysia.net> List Postings to <sangkancil@malaysia.net> ________________________________________________