Reflections on Indonesia's Transition: Michael Green Examines Recent Developments in Indonesia and Warns That Its Medium-Term Outlook Is Mixed

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My four years as New Zealand's Ambassador to Indonesia coincided with one of the country's periodic political upheavals. The first was the independence struggle of the late 1940s; the second was the failed coup of September 1965, which led to Sukarno's removal from office and to the creation of the New Order government led by Suharto; and the third was the sudden collapse of the Suharto regime and the subsequent effort--still under way--to set in place a more democratic successor.

News coverage of developments since 1997 has not been of great assistance to New Zealanders seeking to understand better what has been happening in Indonesia. The news has been dominated by conflict and violence--and there has certainly been plenty of both--with little attention to the forces and processes underlying the social, political and economic turbulence. To put it another way, there has not been much context. An attempt will be made here to provide some--both international and Indonesian.

Though the circumstances of Suharto's departure from power were in many respects specific to Indonesia, this development had precedents or parallels and similar outcomes in other parts of the world. In Europe the collapse of the Soviet Union and its Eastern bloc of client states left a sizable group of countries looking for assistance in developing democratic systems of government and capitalist economic systems. Within the OECD they were designated `countries (or partners) in transition'. This terminology was meant to indicate that they were not `developing countries' in the usual meaning because they were richer in per capita GNP and quite sophisticated in technological development.

Several countries in Latin America and Asia, though not explicitly included among the `countries in transition', have been attempting a similar transformation--leaving behind authoritarian political systems and retreating from statist economic systems. Like Indonesia, most are developing countries. Most were escaping right-wing, often military-dominated regimes, rather than communist systems as in Eastern Europe and the former Soviet republics. They have encountered many problems in common, and in some areas have looked to each other for models; in Indonesia, for example, considerable interest has been shown in the experiences of South Africa, Argentina and Chile with `truth and reconciliation' processes.

Long-haul process

The evidence in all these countries suggests that transformation of national economic and political systems is a long-haul process, fraught with difficulties and prone to setbacks. The euphoria generated by the arrival of democracy and human rights is difficult to sustain in the face of the day-to-day struggles of the new governments and the inevitable deflation of public expectations. Indonesia is, in relative terms, a latecomer, almost a decade behind the Eastern Europeans in leaving authoritarianism behind. And Indonesia's circumstances have been especially unpropitious, given the extraordinarily severe impact on its economy of the 1997 Asian financial crisis. That crisis may have precipitated Suharto's fall but it made the tasks of his successors a great deal harder.

Looking at these kinds of regime change in an international context, a key element has been the removal of ideology as a determinant. The end of the Cold War largely eliminated Western concerns about communism, which had led to tolerance of, if not active support for, undemocratic but Western-leaning regimes in many regions. Indonesia under Suharto fell within this category, valued for the stability its government had imposed on a volatile and strategically sensitive archipelago and for the moderate and constructive role it played in regional and international affairs. But in the post-Cold War environment the major Western powers were much less inclined to support the repressive domestic arrangements on which `stability' was based, and much more inclined to support demands from Indonesia's growing middle-class for greater political participation and greater respect for human rights. …