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ASIET Net News 43 – November 10-16, 1997

East Timor

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 East Timor

Five East Timorese students shot and wounded in Dili

Amnesty International - November 14, 1997

Five East Timorese students shot and wounded in a confrontation with Indonesian police in Dili, the capital of East Timor, have been taken to a military hospital. The five appear to be being denied access to humanitarian and legal assistance, raising serious concerns for their well-being in custody.

Reports of the events are still unclear but it is believed that a confrontation between students and the security forces began at the University of East Timor in Dili early in the morning of 14 November 1997. Students are reported to have thrown stones at members of the security forces at the university. Riot police arrived to quell the disturbance. The police claim they fired warning shots in the air.

At least five youths are known to have been wounded by the gunfire, three of whom are believed to be Antonio Viegas, Albino Barros and Natalina de Araujo. Amnesty International cannot confirm the identities of the two other students.

One of the students, who received a life-threatening gunshot wound in the neck, was forcibly removed from a vehicle of the International Committee of the Red Cross (ICRC) by police.

Eyewitnesses have reported that he was immediately severely beaten by the police before being taken away. It is believed that he and the other four known to have been wounded were taken to the military hospital in Dili, Wirahusada Hospital, where they are believed to be currently in custody. Allegations that one of those wounded has since died cannot be confirmed.

There are reports that up to 11 students have been taken into custody but it is not clear if this includes the five students known to have been taken to the military hospital. The Indonesian military have admitted that arrests have been made. Agence France Press has reported the East Timor Military Commander as stating that "a few people were arrested for criminal actions".

Amnesty International is concerned that the five students known to have been wounded are at risk of further ill-treatment at the military hospital, particularly in view of the treatment handed out to the man taken out of the ICRC vehicle. Torture and ill- treatment of political detainees is routine in East Timor, in particular when detainees are denied access to humanitarian assistance, independent legal advice and their families.

Army denies report one East Timorese shot dead

Reuters - November 14, 1997

Jakarta – At least one East Timorese student was killed on Friday when security personnel fired shots on a university campus in the territory's capital Dili, students said.

A military official denied there had been any deaths.

One student source told Reuters by phone from Dili: "The troops fired shots towards the students and I saw one student fall. Later I heard one student had died."

Other sources said there might have been more casualties.

A military official on duty in Dili confirmed there had been an incident at the University of East Timor campus but said everything had returned to normal.

"Everything has returned to normal, and it's not true there were any deaths," he said.

A diplomatic source in Jakarta said three people had been severely wounded by bullets and had been taken to a military hospital. Officials at the hospital refused comment.

Manuel Abrantes of the Commission for Peace and Justice, a group linked to the Roman Catholic Church, told TSF radio in Portugal that the incident erupted after a row between three Timorese students and two plainclothes Indonesian army members. East Timor is a former Portuguese colony.

Abrantes said the students challenged them and asked them what they were doing on the campus.

The officials fled but came back with soldiers and the shooting started, Abrantes said.

"Ten minutes later they came back with more Indonesian soldiers all armed and they started to shoot," he said.

Eight youths had been injured, three seriously, he said, adding 13 students were arrested and taken for interrogation. Church sources in Dili said they believed the authorities had detained 11 students.

ImAbrantes said Indonesian officials had prevented the Red Cross and humanitarian organisations from entering the university after the incidents.

"Inside the university there was panic and we could only contact them by phone...the military authorities did not let the Red Cross and other humanitarian organisations in," he said.

An office worker in Dili's city centre near the governor's office, about a kilometre (less than a mile) from the university, said the shooting could be heard across town.

Students said two plainclothes intelligence agents had been watching activity on the campus following a candlelight vigil on Wednesday marking the 1991 anniversary of a massacre by troops in Dili.

The students contacted by phone said police and later troops moved onto the campus to break up a fight involving students and the intelligence agents.

The students said security authorities had shot sporadically into the air.

One visitor to the university after the incident said there were large pools of blood in one classroom with a trail of blood indicating at least one person had been dragged away.

The candlelight vigil on Wednesday marked the anniversary of the 1991 massacre in which troops killed 50 anti-Indonesian demonstrators, by official count.

Eyewitnesses and human rights groups have said up to 180 people died.

Indonesian authorities on Thursday deported a 34-year-old American woman, Lynn Anne Fredriksson, after police accused her "disturbing public order" at the commemoration ceremony in Dili.

Indonesia invaded East Timor in December 1975 and incorporated it as its 27th province the following July in a move still not recognised by the United Nations.

U.S. woman ordered to leave Indonesia after East Timor protest

Associated Press - November 13, 1997

Irwan Firdaus, Jakarta – Indonesia deported an American woman Thursday after police arrested her for taking notes and photographs during a pro-independence protest in the disputed territory of East Timor.

Police said Lynn Fredricksson, 34, of Washington, D.C., had been working illegally as a journalist and contacted pro-independence groups after she arrived in East Timor on Nov. 6.

The East Timor Action Network of New York said Fredricksson had been observing a peaceful vigil at the University of East Timor when she was arrested Wednesday, then interrogated for more than 10 hours.

Fredricksson left Bali island Thursday evening on a Singapore Airlines flight to Singapore and planned to fly on to New York, said Yunus Junaid, an immigration official at the Bali airport. She was accompanied by staff from the U.S. consulate in Bali, Junaid said.

Police said Fredricksson, a student at a San Francisco university, was detained after she was seen taking photographs and writing notes during the ceremony to commemorate a 1991 military massacre of protesters.

A statement from police headquarters in Dili, the provincial capital of East Timor, said: "The tone of the contents of the notes discredits the Indonesian government."

Police spokesman Capt. Widodo alleged that she had broken Indonesia's immigration laws by working as a journalist after entering the country on a tourist visa.

The U.S. Embassy in Jakarta declined to comment.

Several ceremonies were held in Dili on Wednesday to commemorate a massacre of pro-independence protesters by Indonesian troops on Nov. 12, 1991. An official investigation suggested about 50 people were killed. However, human rights groups and other activists say the figure was closer to 200.

Indonesia invaded East Timor, a former Portuguese colony, in 1975 and annexed it a year later. The United Nations does not recognize Indonesia's rule over the half-island territory.

Troops fire shots to disperse students in East Timor

Associated Press - November 14, 1997

Dili – Indonesian troops fired shots into the air to disperse hundreds of students today in East Timor. At least two people were injured in scuffles with authorities, school officials said.

Student activists, who declined to give their names, said two students were killed in the violence outside the University of East Timor in Dili, about 1,250 miles east of Jakarta.

But military spokesman Capt. Triyoga Budi told The Associated Press that troops fired only warning shots and no one was killed.

"If there was any dead then I think there would be an uproar," Triyoga said.

The violence came two days after students held a peaceful candlelight service on the campus to commemorate the massacre of pro-independence protesters by Indonesian troops on Nov. 12, 1991.

Indonesia invaded East Timor, a former Portuguese colony, in 1975 and annexed it a year later. The United Nations does not recognize Indonesia's rule over the territory.

A statement from university officials said a bullet grazed the neck of one student, who was hospitalized along with another whose face was badly beaten.

Witnesses said the crowd of students gathered after an unidentified group chased three men, apparently undercover security officers, along a street near the campus.

A squad of 10 soldiers were deployed outside the campus within minutes. They fired warning shots amid jeers from about 300 students from the college and two nearby high schools.

Col. Slamet Sidabutar, East Timor's military commander, said several people had been arrested after they had mobbed security personnel.

Publicising East Timor

Report by Kabar dari PIJAR - 12 November 1997 (posted by Tapol)

Several meetings to highlight the situation in East Timor were held in Central Java on the occasion of the sixth anniversary of the Santa Cruz Massacre, 12 November 1997. Speaking at all the meetings which were jointly convened by PIJAR, the pro-democracy reform organisation, and IMPETTU, the Association of East Timorese Students and Pupils, was Tri Agus Susanto, who spent more than two years in prison in Jakarta on charges of showing disrespect for the Head of State.

The meeting in Yogyakarta, held at Atmajaya Catholic University, heard Hortencio Pedro Vieira of IMPETTU declare that people should study the history of both Indonesia and East Timor. Following East Timor's unilateral declaration of independence on 28 November 1975, foreign forces contrived to issue a counter proclamation known as the Balibo Declaration on 30 November. Neither of these was recognised by the UN which to this day regards East Timor as a 'non-self-governing territory'. He found it strange that Indonesia, under President Sukarno, was strongly anti-colonialist whereas under President Suharto, Indonesia's position has been reversed, doing everything to halt the decolonisation process in East Timor.

Another East Timorese named Joao Maco, member of the East Timorese Student Movement which was set up by Major-General Prabowo Subianto, welcomed East Timor's integration with Indonesia, saying that it was the least worst option available to the people of East Timor. He admitted that there were many shortcomings and said the task of East Timorese youth is to improve conditions.

Drs Suryo Leksono, a lecturer at the political science faculty, said that global circumstances at the time of the Indonesian invasion were dominated by the Cold War but now that the Cold War was over and communism had been defeated, the best option was for a referendum to be held in East Timor.

Tri Agus stressed the need for the pro-democracy movement to embrace the issue. He quoted the East Timorese resistance leader, Xanana Gusmao as saying that the Indonesian pro-democracy movement and East Timor's struggle for liberation had different objectives but faced a common enemy. This points to the need for the two to collaborate closely with each other.

A lively debate followed, particularly because the two East Timorese speakers had presented opposing views.

Another meeting, held in Semarang, at Unika Soegijapranata University, was addressed by Horacio de Almeida who chairs the Semarang branch of IMPETTU, Benny Danang Setyanto who lectures in international law at the university, and Tri Agus.

Horacio said that East Timor is in essence a political problem which can only be resolved by listening to the aspirations of the people of East Timor. The solution to the problem is a matter for the international community, not just for Indonesia and Portugal to solve.

Setyanto, a graduate from Diponegoro University and Monash in Melbourne, said that it was clear beyond doubt that the Indonesian government and ABRI had violated international law. In the wake of the Balibo Declaration, a document concocted by Indonesia, the armed forces had repeatedly ignored UN resolutions calling for their withdrawal from the territory. He spoke at some length about the challenge mounted by Portugal against the Timor Gap Treaty at the International Court of Justice and said that Indonesia's international standing is constantly being plagued by the issue.

Tri Agus focused on the attitude of Indonesian intellectuals and journalists who base their analysis on information produced by the armed forces. He said they were just as much to blame as the generals who participated in the war against East Timor. He described ABRI's involvement in East Timor as a violation of the Constitution. They had attacked the people of another country, integrated into the Republic a territory that was not part of the Dutch East Indies and trampled on the sacred principle that independence is the right of every nation.

Most of those who raised questions and made comments strongly condemned ABRI for failing to withdraw from East Timor and regretted the fact that Indonesia continues to refuse to allow a referendum to take place in East Timor.

East Timor survivors tell Ottawa of atrocities

Toronto Star - November 13, 1997

Allan Thompson, Ottawa – Joao Antonio Dias said he watched Indonesian soldiers kill wounded East Timorese demonstrators by banging their heads against rocks.

Roberto Jeronimo spoke of beatings and electrical shocks to his genitals he endured while being tortured in an Indonesian prison.

Josefina Ribeiro told of how she was lined up in a classroom in East Timor, with all the other girls, and forcibly injected with the birth control agent Depo Provera.

All three were among witnesses who told their stories yesterday during a mock war-crimes trial of Indonesian President Suharto, whose forces stand accused of gross abuses of human rights in East Timor, a former Portuguese colony which Indonesia invaded in 1975 and claimed as its 27th province.

Suharto is scheduled to attend the Asia Pacific Economic Co- operation summit in Vancouver later this month.

Thirteen expatriate East Timorese, brought to Ottawa by the East Timor Alert Network, told of executions, torture and other abuses at the hands of soldiers from Indonesia. The network believes Suharto should be barred from Canada based on an Immigration Act provision that forbids entry by those linked to crimes against humanity.

Dias was working in the lab of the military hospital in Dili, the East Timorese capital, on Nov. 12, 1991, when soldiers opened fire on demonstrators in the Santa Cruz cemetery.

Dias was forced to help unload bodies from trucks that brought the dead and wounded to the hospital, where bodies filled the morgue and then were simply lined up outside.

"The survivors were calling out for their mothers, they were calling for help. The military response was to stab them with daggers and with rifle butts, and to smash their heads against the rock," Dias said.

"In the meantime, the trucks kept coming with more bodies and they drove right over the ones that were on the ground. Many of the wounded gesticulated, moving their arms and their legs to show that they were still alive, but the trucks kept running over them.

"I witnessed this killing but I could not do anything," said Dias, his words choked by tears. "I felt helpless."

Dias and other witnesses spoke in an ornate committee room on Parliament Hill, standing before a large portrait of a bloodied little girl who survived the Dili massacre.

Jeronimo, 42, a nurse and activist in the independence movement Fretilin, told of being tortured with electric shocks to his genitals. After his release, he worked in a military hospital.

"At the hospital, I often witnessed torture, rape and executions," he said. "Some were taken away in helicopters and thrown into the sea."

In 1983, he was arrested again and subjected to beatings and torture that included electrical shocks and having his finger nails pulled out.

Alfredo Rodrigues, 28, bared more than his soul yesterday. In the middle of his testimony, during which he described how soldiers crushed his toes and burned his body with cigarettes, Rodrigues turned around and pulled up his shirt, revealing a back covered with scars and burn marks.

A tearful Josefina Ribeiro, 25, said Suharto hoped "to eliminate us by stopping us from having baby."

"Like so many other Timorese women, I was injected with Depo Provera," she said. "All my male classmates were asked to leave the room, all the women were asked to line up so they could give the injection."

Aviano Faria, 27, told of how he survived the shooting in the Santa Cruz cemetery by pretending to be dead - but still being kicked in the head and stomach by Indonesian soldiers.

"As I speak here today my fellow brothers and sisters are still being killed," he said.

Dissidents chronicle Indonesian rights abuses

Ottawa Citizen - November 13, 1997

Bruce Cheadle, Ottawa – Isabel Galhos, one of three East Timorese expatriates living in Canada, doesn't mince words when she describes the 22-year regime of Indonesian President Suharta.

"We are the generation that has lived through genocide," Galhos, 25, told a solemn gathering Wednesday that was equal parts media, East Timorese or Indonesian dissidents and sympathetic observers.

"I'm talking about murder, I'm talking about rape, I'm talking about mothers still looking for their children."

Thus began three hours of graphic, often heart-breaking and sometimes harrowing testimonials to the ongoing repression and brutality of the Suharto regime.

The purpose of the exercise, eight days before the beginning of the Asian Pacific Economic Co-operation summit in Vancouver, was to dissuade the federal government from allowing Suharto into Canada to attend.

"Either bar him or put him behind bars," said dissident Indonesian professor George Aditjondro.

Neither will happen.

Canada's relations with Indonesia, and Suharto, have warmed considerably this year. In July, the two governments signed a joint declaration designed to "broaden relations and enhance mutual confidence."

Foreign Affairs Minister Lloyd Axworthy speaks of "principled pragmatism" in defending his policy to engage repressive governments in China, Cuba and Indonesia through trade arrangements.

Against Wednesday's tales and photos of torture, imprisonment and teenage sterilization, the principles were hard to find.

Joao Dias, a lab technician, described working at a military hospital in Dili, East Timor, when Indonesian soldiers opened fire on demonstrators, Nov. 12, 1991.

Some 18 truckloads of dead or wounded were dropped at the hospital.

"The survivors were calling out for their mothers, calling out for help," said Dias, choking back sobs.

"The military response was to stab them with bayonets, to beat their heads with rocks. I witnessed this killing, but I could not do anything."

Aviano Faria told a harrowing tale of being dumped for dead in the military morgue, where he watched soldiers dispatching other wounded survivors of the Dili massacre.

Faria escaped by convincing soldiers he was an Indonesian spy beaten by mistake.

Galhos described soldiers entering her classroom when she was 13 and forcibly injecting all female students. She later learned it was Depo Provera, a birth control drug.

And Roberto Jeronimo, a nurse, recounted his torture with electric shocks to the genitals and having his fingernails pulled out by soldiers in 1983, a year after he was appointed by Indonesia to a local government position.

Longtime social activist and former New Democrat MP Marion Dewar compared appeasing Suharto to Canada's policy of turning away Jews after the Second World War. History will judge us harshly, she said.

"Do we now want to be part of a generation of Canadians that is welcoming Suharto, a murderer, a torturer, a sterilizer of young women?" said Dewar.

An illuminating episode took place at the end of Wednesday's mock trial when several speakers angrily approached an Indonesian women who had been filming the proceedings.

She claimed to be "a housewife married to a Canadian" freelancing for the Indonesian news magazine Gatra, which is supportive of Suharta. She had filmed each speaker, briefly.

She cut short the debate to fly to Toronto, in order, she said, to attend the next speech by the Timorese dissidents.

The woman was dismissed as a spy.

"It's part of the government's psychological intimidation," said Aditjondro.

"It's mental terror."

Indonesia deports U.S. woman after Timor protest

Reuters - November 13, 1997

Jim Della-Giacoma, Jakarta – Indonesia moved to deport a U.S. woman on Thursday after police accused her of "disturbing public order" during a ceremony marking the anniversary of a 1991 massacre of East Timor civilians by Indonesian soldiers.

An immigration official in the territory's capital, Dili, said Lynn Anne Fredriksson, 34, was expelled from East Timor on Thursday morning. She was put on a flight to the resort island of Bali.

"There is indeed an American woman here in the waiting room accompanied by American consulate officials. She was earlier sent from Dili," Yunus, an immigration duty officer at Bali's Ngurah Rai airport, told Reuters by telephone.

"She will fly to Singapore this afternoon at 5 p.m. (0900 GMT) on a Singapore Airlines flight," he said.

The official Antara news agency quoted the head of the Justice Department's East Timor office, I Made Parke, as saying that Fredriksson was expelled for violating immigration laws by disturbing security and public order during Wednesday's ceremony.

It had earlier quoted East Timor Police Chief Colonel Atok Rismanto as saying Fredriksson was being deported because she abused her tourist visa by undertaking "journalistic activities."

Parke said Fredriksson was a freelance writer specialising in human rights and had violated immigration laws as she had entered the country on a tourist visa. Her friends in the United States said she was not a journalist.

Fredriksson was not available for comment and the U.S. embassy in Jakarta said they were unable to comment on the case.

Parke said Fredriksson's diary contained the names and addresses of a number of "problematic" Indonesian non-government organisations which had discredited Indonesia.

Based upon this evidence, it was suspected she was a danger to public order under section 42 of the 1992 immigration law.

"Lynn Ann is being deported from Indonesia because it has been proved she has broken the law. We are proposing her name be entered on the black which means she will be forbidden from entering Indonesia," Parke was quoted as saying. Rismanto said Fredriksson engaged in journalistic activities an hour before the University of East Timor held a candlelight vigil for protesters killed near Dili's Santa Cruz cemetery in 1991.

The government has said that Indonesian troops killed 50 demonstrators on November 12, 1991, following a funeral for anti-Indonesian activists.

Witnesses and human rights groups estimated more than 180 people died in the 1991 incident.

Indonesia invaded the former Portuguese colony of East Timor in December 1975 and incorporated it as its 27th province the following July in a move the United Nations has refused to recognise.

Rismanto said Fredriksson had given the students support and encouragement. He said she had taken pictures of the students' activities, in violation of her tourist visa.

Police said earlier they had seized her film and developed it.

East Timor police spokesman Captain Widodo said from Dili on Thursday Fredriksson was the only person detained at the candle lighting ceremony.

Rismanto said that during an interrogation by policewomen, Fredriksson ate a piece of paper which police believed contained information that she did not want to fall in the hands of authorities.

Congress votes to bar use of U.S. weapons in East Timor

East Timor Action Network Press Release - November 13, 1997

On the night of November 12, 1997, the U.S. House of Representatives voted to block the use of U.S. weapons in occupied East Timor, placing an unprecedented restriction on U.S. arms sales to Indonesia. The Senate, which unanimously approved stronger language on September 5, is expected to enact the measure today.

The vote, on the sixth anniversary of the "Dili massacre" in East Timor, comes as the White House is offering a three billion dollar financial bailout for Indonesia, and on the eve of expected meetings involving President Clinton and Defense Secretary Cohen, and General Suharto, Indonesia's long-standing dictator.

The Congressional vote deals a severe blow to Suharto and his embattled regime, and may endanger all future weapons deals between Washington and Jakarta.

The new legislation, included in the foreign operations section of the FY 1998 appropriations bill, requires that any contract to sell lethal equipment to Indonesia "state that the United States expects that the items will not be used in East Timor."

The Indonesian government has stated repeatedly that it will not accept conditions on weapons sales, particularly conditions tied to its record on human rights. This spring, Suharto cancelled a pending F-16 fighter plane deal because members of Congress were talking about attaching human rights conditions.

The bar to U.S. weapons use in East Timor, sponsored by Senator Patrick Leahy (D-Vermont), was crafted in House-Senate Conference Committee with unanimous bipartisan support.

The East Timor Action Network (ETAN) praised the vote as a turning point in the world-wide campaign to end Indonesia's illegal occupation of East Timor. ETAN mounted an extensive grassroots campaign on behalf of the legislation.

"This bill is unprecedented. It puts Jakarta on the spot. Now each time they sign a deal to acquire weapons from the United States, they will have to, in effect, agree not to use those arms in occupied East Timor" said ETAN National Coordinator Charles Scheiner.

Scheiner added that the bill is a political milestone because it constitutes implicit recognition by the U.S. Congress that, despite the Suharto regime's claims, East Timor is distinct from Indonesia.

Indonesia invaded East Timor in 1975 and has occupied it ever since, despite two U.N. Security Council resolutions calling on Jakarta to "withdraw without delay." The resolutions, as well as eight resolutions passed by the U.N. General Assembly, recognize the right of the East Timorese to self-determination. The U.N. classifies East Timor as a non-self-governing territory. The United States has never extended de jure recognition to the takeover.

According to estimates by Amnesty International and Col. Gatot Purwanto (the former Indonesian intelligence chief in East Timor), roughly 200,000 East Timorese – a third of the original population – have been killed as a result of the Indonesian army's occupation.

The East Timor weapons ban is the latest in a series of expanding restrictions imposed by the U.S. Congress on the sale of arms to Indonesia. Public and Congressional pressure blocked a transfer of F-5 fighters in 1993, and under similar pressure, in 1994 the State Department instituted a ban on the sale of small arms and crowd control equipment to Indonesia. The ban has since been expanded to include helicopter-mounted weapons and armored personnel carriers.

As a result of such pressure, Suharto has apparently agreed to enter talks on Timor this month, to be held informally under the auspices of South African President Nelson Mandela.

The Timor legislation (Section 571 of the Foreign Operations Appropriations Act of 1998, H.R. 2159) reads in full: "In any agreement for the sale, transfer, or licensing of any lethal equipment or helicopter for Indonesia entered into by the United States pursuant to the authority of this Act or any other Act, the agreement shall state that the United States expects that the items will not be used in East Timor: Provided, that nothing in this section shall be construed to limit Indonesia's inherent right to legitimate self-defense as recognized under the United Nations Charter and international law."

"The key phrase 'the United States expects that the items will not be used in East Timor' means that the U.S. regards Indonesia as obligated to refrain from using the weapons in East Timor," said Roger Clark, Professor of International Law at Rutgers Law School, Camden, NJ. Professor Clark, a legal advisor to ETAN, is widely viewed as the leading international scholar on the legal status of East Timor.

After the December 1975 invasion of East Timor, the State Department's legal office said that the use of U.S. arms weapons during the invasion violated the agreement governing weapons sales to Jakarta signed in August 1950. The Mutual Defense Agreement Between the United States of America and Indonesia on Equipment, Materials and Services allows the use of the weapons "solely for legitimate national self- defense" as defined by the U.N. Charter.

Xanana says he never asked to be transferred to Nusakambangan

MateBEAN - November 11, 19987 (posted by Timor International Support Center)

Jakarta - Xanana Gusmao told MateBEAN that he had never asked to be transferred to Nusakambangan, an Alcatraz-like prison island off the shore of Cilacap, Central Java as was stated by Thahir Abdullah a high-ranking officer from the Department of Justice

Thahir had many times remarked to the press on this issue. He said this to Media Indonesia newspaper a few days ago and repeated it to Kompas on Monday 10 November 1997.

"I am willing to make a written application for a transfer to Nusakam- bangan. In doing so, I can avoid to meet my comrade in arms who are usually using my name on their activities to support our struggle," said Thahir quoting Gusmao. However, Gusmao denied strongly Thahir's remark, "I never said such statement".

Gusmao was also denying his involvement in the activity of the so-called Brigada Negra, an elite military unit of Falintil. This brigade is being accused to be the organisation behind the making of bombs in Demak, Central Java. The military captured two members of the brigade in Dili and four other in Semarang.

Gusmao told MateBEAN that he can not resist the use of his name for East Timor independence struggle, regarding that he is still the Commander of Falintil Forces and the President of the National Council of Maubere Resist- ance (CNRM).

"I am responsible for all their activities, but I am not involved in the making of the bombs," Gusmao said.

Certain Indonesian human rights groups believed that Thahir Abdullah's statement was a political tactics to avoid criticism from international society when the authorities decided to banish Gusmao to Nusakambangan and make him difficult to communicate with his comrade in arms.

The military wants IMPETTU banned

MateBEAN - November 10, 1997 (posted by East Timor International Support Center)

Jakarta – Rumours said that the Indonesian military, especially the intelligence community planned to ban IMPETTU (the East Timor Students' Association) considering the fact that they cannot control the Organisations' activity anymore. Recent development of IMPETTU's activity revealed clearly that its political views are shifting and now they are much more against the government's integration policy

The rumour had been heard stronger after some IMPETTU documents fell in the hands of the intelligence. The documents were written two weeks ago by some IMPETTU Secretariats and sent to participants of All Inclusive Intra-East Timorese Dialogue (AIETD) III in Krumbach, Austria.

The documents was signed by IMPETTU functionaries and strongly recommended a broadening of materials being discussed on the AIETD Forum and were also urging to enhance the status of AIETD itself. The letter demanded the participants not only discussing socio-cultural problems but most important- ly, AIETD must talk on the substantial problem itself, i.e., the political status of East Timor. According to them, the uncertainty of East Timor's political status is the root of all problems that lead into violations and denial of human rights in general and economic, social and cultural rights in particular.

The Armed Forces Intelligence Agency (BIA) is now seriously studying the document. As far as MateBEAN knew there were no hints at all that IMPETTU will be banned in the near future but sources in the students' circles said that it is only a matter of time.

IMPETTU is an East Timorese student's organisation born in the eightieths and backed strongly by Indonesian Military, especially by General LB Moerdani. This student organisation was aimed to gather East Timor students who studied in different cities into a one single easy-to-control organisation.

At first IMPETTU bore the same organisational name but up to this moment only Jakarta, Bandung, Solo and Bali branches who still bear the name. IMPET-TU itself has a political meaning; the word "impetus" means strength". Many IMPETTU branches change their name. We can find IMPELTIM in Salatiga, IMAPTI in Semarang, IMPETTY in Yogyakarta, IMARTIM in Surabaya, IMPETIMUR in Malang,and IMPELTIJ in Jember.

The military has long been suspicious towards IMPETTU and growing more suspicious when many of the members were involved in protest rallies against government policies in East Timor. It culminated in Yogyakarta when Major General Prabowo Subijakto openly stated to East Timor students that he did not trust IMPETTU anymore."There are only two organisations whose are fully supporting integration. East Timor Students Movement (ETSM) and the Young Guards of Integration (GARDA PAKSI). Other organisations are all clandestine groups," Prabowo said boldly. ETSM is centered in Yogyakarta and the top organiser is Octavio Osorio Soares (nephew of Abilio Osorio) and Joao Mota (Prabowo's adopted kid); the latter is the one who had been arrested by Norwegian Police in 1996 in Oslo when he tried to be present at the Nobel Prize presentation ceremony for Bishop Belo and Ramos Horta.

Meanwhile GARDA PAKSI is centered in Dili, and headed by a certain Marcal Almeida, a regional parliament member from Golkar faction. Garda Paksi is actually a kind of vigilante group, acting as informant to the Military intelligence unit, SGI. This group is popular among the people of East Timor for their behaviour in terrorising anti-integration youths.

East Timor students must start thinking about the worst possibility, i.e., IMPETTU's banning and take appropriate steps to anticipate it.

Five East Timorese go on trial for election-related ambush

Indonesia Times - November 11, 1997

Dili – Trials began Monday for five East Timorese accused of taking part in a rebel raid on a police station on May 28.

Prosecutors allege the men were among the rebels who stormed the station in the provincial capital, Dili, stabbed two officers and then fled with police weapons. One rebel was shot dead by police.

The clash was one of several between Indonesian forces and rebels in the lead-up to national parliamentary elections.

At least 22 people were killed in the pre-election violence in East Timor, a former Portuguese colony which changed authorities to Indonesia in 1975. More were killed in clashes after the election.

The five defendants - Jermias da Costa, Jose Mali Amaral, Ernesto Rodrigues Martins, Akau da Costa and Francisco Magno - were charged with attempting to undermine the Indonesian government.

If convicted, they could be sentenced to life imprisonment.

Prosecutors also accuse the men of giving supplies and information to other rebels prior to the attack.

Only one of three defense lawyers was allowed to represent the defendants in court.

Two other lawyers from Jakarta were barred by the Dili High Court. Officials said they did not have permission to practice in East Timor.

Protest against Indonesian army

MateBEAN - November 11, 1997 (Posted by the East Timor International Support Center)

Lospalos – Last 3 November 1997, dozens of East Timor youth conducted a demonstration in Los Palos, Lautem. The demo was a protest against the behaviour of army soldiers shooting in random when a group of Catholics passed a military post in Paioto. Los Palos on August 31.

They carried banners and one of the biggest banner said "ABRI, if you do not like our people, go to hell and leave Loro Sae Land!" The white banner was tied across the main road of Los Palos. They also blocked the main road with rocks and burned car tyres.

"We were on a a religious pilgrimage to Soibada, Baucau, when suddenly we heard shots," said a young man to MateBEAN

Soibada is the biggest Catholic mission in East Timor. The pilgrimage itself was one of many ceremonies commemorating the Month of Virgin Mary. Almost all Catholics from the whole East Timor joined the procession.

Although there were no casualties in the incident, the people of Lautem was angry to the barbarian act of the military unit and did not respect a religious procession.

A local military authority said in an official report that his soldiers was forced to shoot because some people threw stones at the military building and shouted obscene words to the soldiers.

But the report was denied by the protesters. The highest ranking local government authority (Bupati), Edmundo da Conceicao, tried to be a mediary by arranging a meeting between the protesters and the military district comman- der, Lieutenant Colonel Pandu Wibowo and the 745th Los Palos Army Battalion commander Lieutenant Colonel Simson Siregar. The protester dispersed after Pandu Wibowo promised to punish the soldiers responsible for the arbitrary shootings.

East Timor Students' Association met regional parliament

MateBEAN - October 29, 1997 (Posted by the East Timor International Support Center)

Semarang – Fifteen East Timor students from the East Timor Students' Association (IMAPTI) of Semarang had met members of Commission A (dealing with defense and security issues) of the Central Java Regional Parliament. They questioned the MPs on the bad treatment felt by four East Timor youth arrested recently by security officers. As we have mentioned before on our release, the four were arrested in connection with a bomb explosion in their rented house in Demak, Central Java.

At first the Commission members refused to meet the students, but the students resisted to go home and at last four members of the regional parlia- ment were willing to meet them. Among them was the Chairperson of Karya Pembangunan Faction (FKP) Mohammad Nasri and MP Soetjipto also from FKP, United Development Party member FPP) Syaifuddin and Muzhakar N. from the Armed Forces Faction.

The students were questioning the procedures of the arrest. They men- tioned that the arrest was illegal because the authorities were not bringing an arrest warrant; and up to this moment the family of the prisoners was not officially being informed. They raised questions on the local authority's refusal to give visiting permit for their friends or relatives, and most importantly, up to 22 October 1997, they refused to give permission to the lawyers from the Indonesian Legal Aid Foundation to meet their clients.

They also protested the way the interrogators treated their prisoners, especially the torture by beating and the use of electric current when they interrogated Fernao Pedro Marta Correia. According to the students, physical abuse towards a prisoner is against the values of any legal system, whether it is Indonesian or international system. All legal systems are recognizing the rights of a prisoner to be treated humanely.

The speaker of the students, Celito, demanded to the authorities to recognize the rights of the prisoners, i.e. the right to choose their own lawyers, the right to have visits from their relatives and friends, and the right to send and receive personal letters. Celito also asked the MPs to urge security agencies not to use psychological and physical intimidation in their interrogation to the prisoners.

The meeting lasted for about 90 minutes and the MPs promised to answer the protests and demands at least on the 10th of November because they were still attending the People's Assembly in Jakarta.

The authorities had arrested four east Timorese last September when a home-made bomb blasted the four people's rented house in Demak. Soon afterwards, the authorities found that Fernao Pedro M. Correia (19), Domingos Natalino Coelho Silva (20), Ivo Salvador Miranda (20) and Joaquim Santana (23) is members of the so called Associacao Sosialista de Timor (AST).

Meanwhile, another East Timorese student from Satyawacana University was arrested by Semarang Police Precinct on 30 October 1997 in the middle of a student brawl between East Timor students and the cadets of local Merchant Marine Academy (AKAPELNI). He also being accused of carrying a knife although actually he did not involved in the brawl.

The brawl itself was started by a personal dispute between a cadet and an East Timorese student in a restaurant. Felt embarrassed after being criti- cized of his impoliteness by the East Timorese, the cadet went away and a moment later returned with their fellow cadets to beat the helpless student. Another East Timorese who tried to separate the fight lost his two fingers by a slash of a sickle.

On hearing the accident, other East Timorese students accompanied by East Nusa Tenggara students hunted the cadets and it started a mass riot. Up to this moment there were no AKAPELNI students being arrested.

IMAPTI students went to meet the Police Precinct Headquarters in Semarang and received by the Vice-Commander. They had been given the promise to meet the Commander himself later the next day.

European ambassadors to go to East Timor

The Sunday Tribune - November 9, 1997

Liz Walsh – Three European ambassadors are to go to East-Timor early in the new yeras as part a new EU initiative announced in Dublin last week by British Foreign Seretary Robin Cook. The initiative comes on the eve of the sixth anniversary of the Dili massacre on Wednesday in which more than 250 civilians were shot dead by the Indonesian military which invaded the country in 1975. In addition, a report published this week for the United Nations documents the rape and sexual abuse of East Timorese women by the military.

The mission to East Timor by ambassadors from Britain, Holland and Austria will move throughout the disputed territory, meeting members of the East Timorese resistance movement, high-ranking Indonesian officials and members of the general population. It is expected to press for UN-mediated talks and for the implementation of the 1997 UN Commission on Human Rights resolution. Until now, EU governments have refused to send ambassadors into East Timor for fear a visit would be mistaken as recognition of Indonesian sovereignty over the island.

A spokesman for Foreign Secretary Cook said details of the mission remain to be worked out but that it will go ahead shortly after Britain takes presidency of the EU in January. The Dublin- based East Timor Ireland Solidarity Campaign gave a guarded welcome to the mission, but warned that Indonesia, condemned by Amnesty International as being "casual about mass murder" must not be allowed to "orchestrate".

"The EU must call the shots on this and the safety of the East Timorese people during and after the visit must be paramount" said Dublin director Tom Hyland.

Meanwhile, an Australian report published on Thursday by an Indonesian-born academic details incidents of rape and sexual abuse by the Indonesian authorities against East Timorese women. The report by Dr. George Aditjondro of Newcastle University, Australia, to be presented to the UN Commission on Human Rights in 1998, says that rape is being used as a weapon to "subdue the local population"

In addition to rape, East Timorese women allege they have been sexually abused by the military during house to house searches, often when their husbands are already in jail or in hiding.

 Environment/land disputes

Fire ribbons send smog from Indonesian peat bogs

Reuters - November 11, 1997

Ian MacKenzie, Jakarta – Ribbons of fire along irrigation channels designed to drain a huge peat bog are helping sustain noxious smog across Indonesia's Kalimantan provinces, forestry and agricultural experts said on Tuesday.

A forest research agency said the main pollution on Borneo Island was now coming from fire in a huge area of peat covering about a million hectares (2.5 million acres) that the government has been draining for a massive rice-planting project.

The drainage ditches themselves were on fire, sources said.

"A lot of what's burning is in the peat. It's incredibly hard to put out – very dirty smoke with lots of pollutants." said Neil Byron, of the Centre for International Forestry Research (CIFOR) at Bogor, near Jakarta.

One source said: "I'm told you can see ribbons of fire burning in drainage ditches they had dug."

Bush fires mainly in Sumatra and on the Indonesian side of Borneo Island have been responsible for choking haze that spread in recent months across large tracts of Southeast Asia.

Agricultural sources said there was increasing concern over starvation in the area, which straddles the borders of South and East Kalimantan provinces northwest of the town of Banjarmasin.

Sources said the fire, caused in part by clearing the peat bog, could have destroyed the rice-planting project, which has been backed by President Suharto with the aim of ensuring Indonesia's self-sufficiency in the key staple rice.

One source said the fire in the peat was creating a silicon layer impervious to water which could affect future irrigation vital for wet rice planting.

Government officials said rain had fallen sporadically on Sumatra island at the weekend, and only three airports were closed on Tuesday due to poor visibility compared to five on Monday.

"Smog has generally eased throughout Sumatra island because of the rains on Sunday. We don't have reports of rains on Kalimantan yet and smog still persists there," an official at the forest fires control bureau in Jakarta said.

On Sumatra, visibility in the town of Jambi – one of the worst hit centres in recent months – was down to 20 metres (yards).

Jakarta itself received its first heavy rainfall for months on Monday night, but the city of over 10 million people was blanketed in thick haze on Tuesday morning from its perpetual traffic pollution.

"It rained last night in Jakarta. The haze which covers the city now is the result of pollution. What we now have to pay attention to is the possibility of floods in Jakarta," the fire control bureau official said.

CIFOR's Byron said it was difficult to give an exact estimate of the area affected by fires, but he said a rough estimate was 800,000 to one million hectares (2.0 to 2.5 million acres).

The authorities have blamed plantation and forestry firms and small farmers for setting fires to clear land for planting.

Byron said the worst affected areas appeared to have been logged over forest. From an economic and ecological point of view, "most of that forest is already dead, if not cremated."

He said the El Nino upswelling of warmer water in the Pacific Ocean off South America, which affects global weather patterns, was likely to continue affecting Indonesia, now in the grip of its most serious drought in decades.

Dry winds from Australia are forcing back the massive monsoon rain clouds to the north that normally spread over the archipelago from September. Some experts say the rains may not come before the new year.

Drought forces tribes to go in search of food

South China Morning Post - November 11, 1997

Jenny Grant, Jakarta – Three isolated tribes in the Molucca Islands are being forced to leave their settlements in search of food as the drought bites harder in the eastern provinces.

Already it has cost more than 500 lives.

About 1,700 members of the Kadai, Siboyo and Mangei tribes on Mangole Island in the eastern Moluccas are searching the island for food, according to district official Umar Hassan.

Mr Hassan said the tribespeople had received no government assistance because they were "always on the move", the Jakarta Post reported.

He said the tribes were also forced to move on because a timber company was taking up land on the island. PT Barito Pacific is owned by timber tycoon Prajogo Pangestu. Mr Pangestu also held a 50 per cent share in Bank Andromeda, one of 16 banks closed by the Government on November 1.

In the neighbouring province of Irian Jaya the death toll from an outbreak of diarrhoea and malaria has killed 80 villagers in the past week. The deaths occurred in the highland Jayawijaya district and Merauke district which borders Papua New Guinea.

The head of the Jayawijaya district, Jos Buas Wenas, said 90,000 residents in his area were threatened by the malaria outbreak.

Military helicopters began dropping food and medical supples into remote villages in Merauke 10 days ago.

The head of Boma village in Merauke said 10 people had died from diarrhoea in two days and a further 102 people were very sick.

World Vision Indonesia estimates 200,000 people in 21 villages in Irian Jaya are affected by food shortages. Officials said at least three areas of East Nusa Tenggara were facing rice shortages. Villagers on Flores and Timor islands need an extra 100 tonnes of rice.

The Government fears food shortages and the five-month drought could spur social unrest before presidential elections in March.

Indonesian farmers suffer as drought hits home

Reuters - November 9, 1997

Kenneth Van Toll, Banjar Rejo – Mardjosantono waved his wiry arms over his head as he stood on the crusty sun-baked bottom of Lake Keruku in East Java.

"Usually there's water to the north, south and west of here. The water level reaches 3.5 metres (11.5 feet)," the slightly built farmer said gesturing across the dried-out lake.

"It's been dry like this for nearly eight months."

Right across Java, one of the world's most crowded islands with a population of around 120 million, farmers are struggling to eke out a living as they wait for long-delayed monsoon rains to come to Indonesia.

But in the national capital Jakarta, hundreds of kilometres to the west, ministers and scientists have only gloomy forecasts for the little people who are trying to survive by selling precious livestock for water.

The National Meteorology and Geophysics Agency has warned Indonesians on the tropical archipelago of 17,500 islands sprawled for 5,000 km (3,000 miles) along the equator that significant rains may not come until December – or even later.

Although sporadic rain fell in a number of parts of the archipelago in late October, the agency said dry winds from Australia are still dominant, forcing back seasonal rain clouds from the South China Sea and Indian Ocean and delaying the real monsoon.

Officials blame the continuing drought on the El Nino phenomenon, an upswelling of warmer water in the Pacific Ocean off the South American coast that affects global weather patterns.

Indonesia's monsoon rains normally start in September, and build up through the end of the year. This year, the rains are months late and drought is hitting home in the world's fourth most populous nation of over 200 million people.

The drought has also exacerbated bush and forest fires which have sent a choking, health-threatening smog across large areas of Southeast Asia and damaged key commodities such as coffee, cocoa and palm oil.

The drought has affected the whole archipelago, with hundreds of tribal people dying of disease and starvation in the rugged remote forests of Irian Jaya in the far east.

Official sources say the authorities are concerned at the potential for social unrest in the case of severe food shortages. The state logistics agency BULOG says it has enough rice in stock, however, and the government is keeping tight control on rice and sugar despite liberalising trade in other commodities.

Parched brown fields across Java – in area the size of Greece or the U.S. state of Alabama – now lie fallow waiting for the rainy season.

In many parts of the mostly Moslem nation villagers are already praying for rain every Friday in the mosques.

The daily reality for many villagers is the long walk in search of water.

"I come here every day," said Kejum, standing beside a roadside well in the Wonogiri regency of Central Java.

"It takes about three to four hours to fill the buckets. If it's not this dry, I can get water from a well near my house."

Sajogo, 75, recalled periodic droughts that hit the fatalistic and stoic farmers periodically, including a bad drought in 1991- 1992.

"My land has been dried out by the drought and we can't grow anything. Our income has dropped as a result," he said.

But unlike many people, Sajogo's family has not yet had to buy water, generally at about 100 rupiah (3 cents) a can.

Government tanker trucks are regularly distributing water, he said. Other villagers said they just did not wash as much.

"There are people who have sold their animals to buy water, but up until now I haven't heard of anyone who has died of starvation," Sajogo said.

But the rains may also prove a mixed blessing when they finally come. Environmental experts say baked ground and drought out vegetation will lead to floods sweeping across the land.

And the rain will have to be heavy and consistent to soften up rock-hard earth to make it tillable, and also to start replenishing depleted water tables to refill wells.

 Labour issues

Gudang Garam workers go on strike as the management refuses their demands

Indonesia Times - November 13, 1997

Surabaya – At least 40,000 workers of the biggest cigarette company go on strike as their 50 pct salary increase demand is refused by the management.

President director of the Kediri-based PT Gudang Garam, Rahman Halim, who met with the workers' representatives yesterday, refused fulfill the workers' demand.

Meanwhile the Manpower Ministry will examine whether the strike was based on normative matters or not.

"As far as the demand based on normative reference, we will help them," the director general of manpower development and supervision, Syafii Syamsudin, said.

The strike, involving 40.000 workers out of 42.500 workers, asks an improvement of their welfare such as salary raising, payment system and others.

So far, even the company profit is reportedly rocketing, the employees live in a misery, one of the workers said. " We do not need more promises. We are starving, not merely hungry."

Rahman Halim told the workers that the demand can not be fulfilled that the management has increased their salary annually. "We have increased the salary each year even twice whenever needed."

However, Halim said that the PT Gudang Garam management will give the overtime wage and work free right for women workers during their menstruation cycle.

He said that currently the Gudang Gram employees get higher wage (Rp 142,000 per month) compared to the official minimum wage scale (UMR).

During the meeting, the president director was accompanied by chairman of the union.

The decision has made the workers disappointed. They told reporters that the decision was unexpected. They even threatened to resume the strike until the management fulfill it.

It was reported that as the ten-minute meeting was completed most of the workers continued their protest while some of them went back to their works.

The public listed PT Gudang Garam, is the biggest clove cigarette in the country and rarely experiences of worker strike.

However Syamsudin said he was disappointed with the strike, as the Gudang Garam, which is located in Kediri, some 150 km from here, is already go public.

According to Syamsudin the workers need to be more patient. Strike, Syamsudin explained further, is the last alternative. It will be better the workers have a meeting with the management, so that the problems can be solved familiarly, he added.

So far the workers of Gudang Garam, the clove cigarette company, have not asked for help to the P4D ( the regional commission for workers' dispute), he said. The P4D is the mediator between workers and the management when there is a conflict, Syamsuddin added.

The workers however, have already proposed their demand since October, but got not enough response from the employer.

Responding to the complaint of the workers, Syamsudin advised them to continually consult it with the company's management. The Manpower Ministry has not deeply involved in this problem, he added.

50 companies ask for downsizing employees

Indonesia Times - November 11, 1997

Jakarta – At least 50 companies have proposed to the government that they can downsize their employees following the unstable economy due to recent monetary crisis.

The 50 companies are predicted to employ around 10 thousand workers. "At least 50 companies at present apply to the Ministry of Manpower to dismiss their workers," director general of manpower development and control of the ministry S. Sianturi said here yesterday.

So far the ministry was still studying why the companies applied for the dismissal, he said, adding that most them argued that their companies were in financial crisis due to recent monetary turmoil.

Four of the applying companies had reduced the amount of shifts applied in their companies from three shifts into two or one, besides asking for the dismissal, he said. Even, one of them had temporarily stopped a number of their workers' activity in the company.

The companies applying to hold the dismissal deal with several fields including textile, shoes, and the most are forestry industries such as sawmill and plywood.

A major policy the companies are proposing is to cut the number of their workers. The measure will increase unemployment rate if the economic uncertainty fails to end.

"I don't dare to say that the dismissal case will increase, but it is possible that a number of companies will propose for similar measures," Sianturi said.

After being controlled, most of the 50 companies applying to hold the dismissal had fired their workers, he said, adding that their sending information to the ministry was just to ask for agreement.

He named 90 pct of the dismissal process as running "smoothly" as there was no protest and demonstration. "Board of directors and workers generally agree the policy which should be taken by the companies."

The agreement was able to be reached as several materials concerning the right of the dismissed workers – including separation pay – could be fulfilled by the companies, he said.

But the ministry hoped that the companies did not directly dismiss their workers, he said, adding that if any time in the future the companies would return normal, the workers should be recruited again. Different from other companies, household goods producer PT Unilever, however, decided to improve its employees' wage amounting to 11 pct. In a meeting last October with its workers, Unilever director Sri Urip also increased the workers' housing payment amounting to 15.5 and health payment 10 pct.

However, Urip admitted that the country's economic uncertainty as well as the rupiah slide-down value against US dollar had affected people's purchasing power, including to buy Unilever's products.

 Human rights/law

AJI welcomes prosecution's call for Iwik's release

Alliance of Independent Journalists - November 4, 1997 (posted by Tapol)

Jakarta – The Alliance of Independent Journalists (AJI) said it welcomed Prosecutor Amrin Nain's call for the release of Dwi Sumaji alias Iwik, the accused in the case of the murder of Bernas journalist Fuad Moh. Syafruddin alias Udin. The prosecutor called for Udin's [should read Iwik - JB] release during the a court session at the Bantul regional court on Monday, 3 November.

The prosecutor's call confirms that Dwi Sumaji, accused of murdering Udin, was merely a scapegoat found in order to protect the real killer.

As is well known, the proof gathered by various groups, including AJI's Investigation Team, the "White Kijang Team", made up of young Yogyakarta journalists, and the PWI's Fact Finding Team in Yogyakarta, established that Udin's death was in fact related to his work as an independent journalist. And, more specifically, that Udin's death was connected with collusion in the Bantul regency administration involving a number of officials.

However, by contrast, the police manipulated the situation in order to trap Iwik, in an effort to protect the real killer and those behind the killing.

Without wishing to pre-empt the actions of the court, AJI trusts that the judges will also base their decision on the truth, by ordering Iwik's unconditional release and stating that he was not involved. Thus, Iwik's good name can be restored.

Nevertheless, Iwik's unconditional release is insufficient. AJI calls upon the authorities to investigate fully Fuad M. Syafruddin's murder, to bring the true perpetrator to justice, and to reveal the identities of those behind his death. The police officials involved in the false accusations against Iwik which caused him such suffering must be investigated. The authorities responsible for this investigation must reveal the brains behind the police's manipulation, regardless of the identities and rank of those responsible.

AJI protests at press gag over remarks by Bambang

Tapol - November 9, 1997

The Alliance of Independent Journalists has issued a statement protesting against attempts by the Indonesian armed forces (ABRI) to prevent the press from reporting statements by Bambang Trihatmojo and Probosutejo about the closure of 16 banks.

On 4 November, the Information Department of ABRI phoned all newspapers regarding a statement by President Suharto's son, Bambang Trihatmojo, alleging that there were political motives behind the recent decision of the Minister of Finance to close down 16 banks, aimed at cornering the Suharto family and thwarting Suharto's election as president at the forthcoming session of the MPR in March next year.

Bank Andromeda, part owned by Bambang, and Bank Jakarta, part owned by Proboseutjo, a cousin of the President, were among the 16 banks ordered to close by order of the Finance Minister, Mar'ie Muhammad on 1 November. The two men have since declared publicly that they would take the Finance Minister to court over the closure of their banks.

On 4 November, Bambamg pointed to a political motive behind the decision: 'I see this as an attempt to besmirch the name of our family, indirectly aimed against Bapak (Suharto) and ensure that he is not re-elected president.' He told journalists: 'As you know banks owned by myself, my sister Titiek and Probo have been ordered to close and banks owned by Mbak Tutut (older sister), Tommy (younger brother) and Dwikatmono (uncle) were also originally included in the list.' He went on to say that he had consulted with other members of the family about his decision to initiate a lawsuit against the Minister of Finance.

According to SiaR, a news agency on the Internet, on the same evening, State Secretary Murdiono phoned ABRI's Information Department from Kuala Lumpur to pass on an instruction from President Suharto who was in the Malaysia capital at the time to ban the press from reporting the comments made by Bambang. The Department responded immediately by phoning all newspapers one by one, ordering them not to say anything about Bambang's statement.

The instruction turns out to have been very effective. No newspapers reported the news, with the exception of one or two that had already gone to press.

This shows that the Government is still engaged in activities that violate the freedom of the press and the public's right to know.

In a statement issued on 5 November, AJI strongly protested against this censorship and repeated its call on all sides, in particular ABRI and the Government, not to censor the press because this is in breech of the Indonesian Constitution which guarantees the freedom of the press. The statement was signed by Lukas Luwarso, chairperson, and Dadang RHs, Secretary.

 International relations

South Africa and Indonesia to boost economic ties

Xinhua - November 13, 1997

Johannesburg – South Africa and Indonesia are set to boost economic ties with the signing of two agreements on aviation and trade, South African Press Association reported today.

The two accords will be signed when Indonesian President Soeharto arrives in Cape Town next week for a state visit.

An air services agreement would facilitate direct air links between the two countries, while a trade agreement would provide for a joint economic commission, Foreign Ministry officials said in a briefing.

From almost a zero base in the last five years, two-way trade between the two countries has grown to 1.21 billion Rand (252 million U.S. dollars) with the balance in South Africa's favor.

Economic relations between the two countries, however, is still being hampered by the absence of direct transport links and a lack of formal agreements to facilitate economic cooperation.

So far only one agreement on the avoidance of double taxation has been signed.

While media interest is bound to focus on Mandela's bid to have jailed East Timorese leader Xanana Gusmao released, South African government officials have stressed that bilateral and multilateral issues will dominate the agenda.

Foreign Minister Alfred Nzo said he hoped to receive a briefing from his Indonesian counterpart, Ali Alatas, on regional peace efforts in Cambodia and the recent currency damage suffered by countries in Southeast Asia.

South Africa, as the next chair of the Non-Aligned Movement, would discuss multilateral issues with Indonesia, a founding member of the body who held its chair from 1992 till 1996.

On whether Indonesia was interested in buying arms from South Africa, Nzo said he was not aware of any proposed deal.

However, he echoed Mandela's statement in Jakarta that under certain circumstances South Africa could supply arms to Indonesia for defensive purposes.

Nzo defended South Africa's relations with Indonesia, saying his country would have more influence on the question of East Timor through dialogue.

East Timor, a former Portuguese colony, was annexed by Indonesia in 1976.

But the United Nations does not recognize Indonesia's sovereignty over the territory and still recognizes Portugal as its legitimate administrator.

It is currently sponsoring talks between Portugal and Indonesia in the hope of finding an internationally acceptable solution to the dispute.

After his return from a state visit to Jakarta, Mandela wrote to Soeharto calling for Gusmao's release, but received no reply.

He is expected to make the appeal personally when he meets Soeharto, who is scheduled to visit South Africa from November 20 to 22.

 Economy and investment

Tough reforms to last years, says IMF boss

Sydney Morning Herald - November 13, 1997

Louise Williams, Jakarta – Indonesia must push through with successive waves of tough economic reforms, including a possible second round of bank closures, the managing director of the International Monetary Fund, Mr Michel Camdessus, said in Jakarta yesterday.

On his first visit to Indonesia since the recent announcement of a rescue package worth up to $US38 billion ($54 billion), Mr Camdessus said present strategies to prop up the country's currency, the rupiah, were just the beginning.

Significant structural reforms were still needed, he said. These would effect politically sensitive monopolies and the lack of transparency in decision-making and end practices such as leaving parts of the national Budget off the public books.

After meeting President Soeharto yesterday, Mr Camdessus said Indonesia needed a strong economy to deal with social ills such as the gap between the rich and the poor.

"I was happy to see that President Soeharto was convinced that this [the three-year reform program] is what is needed.

"If this is done, and I have no reason to doubt that, I am certain this crisis will be a blessing in disguise and Indonesia will emerge stronger."

At the same time the Administrative Court in Jakarta announced that Andromeda Bank, 25 per cent owned by President Soeharto's son Bambang Trihatmodjo, had withdrawn its legal challenge to its closure as part of the first round of bank liquidations announced recently.

Bambang had publicly admitted breaking the banking laws by exceeding the legal lending limit and had come under pressure from members of his father's Government to show some willingness to share the pain the economic reforms will bring.

Sixteen banks were liquidated on November 1, and yesterday Mr Camdessus revealed that a second list of non-performing banks had been drawn up and served notice that they must recapitalise or negotiate mergers to survive.

Mr Camdessus said: "The closure of the [first] 16 banks is a powerful signal, but restructuring goes far beyond this and tries to save what can be saved.

"I hope we will have more rehabilitations [of the second list] than closures, but if the [additional] banks can't meet the conditions they will have to be closed.

"We are confident that at the end we will have a strong banking industry. You cannot construct a strong economy on sand. If you do that you are building a house of cards and that is dangerous."

As further details of the massive IMF package were revealed it was clear that many of the future reforms would directly challenge the business empires built under President Soeharto's New Order government using political power as a source of business advantage.

Many of Indonesia's remaining monopolies are linked to President Soeharto's children or other members of the elite, and some analysts have questioned the willingness of the richest business groups to give up the advantages they have used to build their conglomerates.

Mr Camdessus said each wave of reforms would follow IMF three- monthly reviews of progress which came with each disbursement of funds.

"If you want confidence you have to have measures to strengthen the supervision of the financial sector.

"The faster these measures are taken the sooner you will harvest the rewards."

The reforms would be accompanied by an economic slowdown, he said, but he was confident high growth rates would be restored within three years.

Crop failure "puts 36 million at risk"

Jakarta: About 36 million Indonesians are at risk as rice crops fail and drought conditions persist and the Soeharto Government must anticipate starvation in isolated areas, an agricultural expert says.

Dr S.H. Dillion, the executive director of the Centre for Agricultural Policy Studies, near Jakarta, said the impact of the present drought was compounded by the most significant economic downturn in three decades leaving the poorest sector of the community at risk.

Thirty-six million people earned less than $15 a month, he said, and warned officials not to "remain in denial until the press reports mass starvation".

"What we are witnessing now is a double bind, and poor households are going to find it very difficult to cope without external assistance."

More than 500 deaths in Irian Jaya, and reports from East Kalimantan of villagers who had died because they could not afford food, had shown that mass starvation was not a thing of the past, he said.

Officials have announced that fires and drought have destroyed more than half of Indonesia's palm oil crop, reducing the productive area from 2.7 million to 1.5 million hectares. This year's coffee crop would be 30 per cent less than last year, they said.

Rice production has already fallen by 4 per cent in the past four months. With planting now impossible in the harsh, dry conditions, there are fears of shortfalls in production next year.

Many rice farmers are small producers and Dr Dillion said the Government must start to use basic yardsticks for the crisis such as identifying families who had already run out of rice and water and were selling personal belongings to survive.

Suharto's son offered deal for closed bank

Agence France Presse - November 12, 1997

Jakarta – Mr Bambang Trihatmodjo, the second son of President Suharto, will take control of Bank Victoria as compensation for the closure of his Bank Andromeda, Bisnis Indonesia said.

The paper said he wanted to take over Bank Victoria last April, but had been refused permission to do so until now. In June, Bank Victoria had assets of 114 billion rupiah (S$51 million) and outstanding loans of 111 billion rupiah.

The report cited an unnamed source as saying that Finance Minister Mar'ie Muhammad may approve the acquisition as compensation for the closure of Bank Andromeda, in which Mr Bambang has a 25 per cent stake.

The report came as Mr Probosutejo, a half-brother of Mr Suharto, confirmed yesterday that he had filed a legal suit against Mr Mar'ie for closing down the bank.

Mr Mar'ie and Bank Indonesia Governor Sudrajad Jiwandono on Nov 1 ordered the closure of 16 banks, including Bank Jakarta and Bank Andromeda, as part of an effort supervised by the International Monetary Fund (IMF) to restore the health of the country's financial sector. Mr Probosutejo and Mr Bambang have challenged the move.

The former said the suit was filed on Friday against Mr Mar'ie for ordering the liquidation of Bank Jakarta.

"Because the licence revocation and the liquidation by Bank Indonesia is not related to the conditions of Bank Jakarta, Bank Jakarta is forced to file a suit against the Finance Minister," he told a press conference here yesterday. "In terms of diseases, Bank Jakarta was only suffering from a cold ... and therefore Bank Jakarta should not have been killed," he said, noting also that unlike several other banks, Bank Jakarta had never sought financial assistance from the central bank.

He alleged that the bank was closed down because he and the management of the bank did not have a cosy ties with central bank officials. Mr Mar'ie told a parliamentary session on Monday that the government was prepared to face the consequences of its decision and said that those "who feel adversely affected" by the liquidations could take legal action.

The Jakarta Administrative Court is due on Wednesday to hold a hearing about a possible trial against Mr Mar'ie and Mr Sudrajad after a suit filed by Bank Andromeda.

Meanwhile, IMF managing director Michel Camdessus arrived in Indonesia yesterday for a two-day visit, expressing admiration for its "courageous" economic reform plan.

"It will be difficult, but I am personally confident that if implemented correctly, it will put the Indonesian economy back on a very good track with even more sustainable growth," he told reporters.

The IMF last month announced an international aid package for Indonesia of nearly US$40 billion (S$62 billion) to help it overcome its economic and monetary crisis.

Suharto's son withdraws bank suit in 'national interest'

Koyodo - November 12, 1997

Jakarta – Indonesian President Suharto's second son Bambang Trihatmodjo announced Wednesday the withdrawal of a lawsuit against the government over the closure of his bank earlier this month for the sake of "broader national interest."

"After observing the economic situation and conditions and the broader national interest, and after Bank Andromeda's request to pay back the deposits of depositors with our own money had been agreed by Bank Indonesia (the central bank), we withdrew our lawsuit against Finance Minister Mar'ie Muhammad and Bank Indonesia Governor Soedradjat Djiwandono," Bambang told a press conference.

The deposits, he said, will be returned as soon as possible and he promised that all depositors would get their money back.

Bank Andromeda officials said the bank has prepared 60 billion rupiahs (about 26 million U.S. dollars) to pay depositors who had up to 20 million rupiahs in the bank.

The government revoked the licenses of 16 ailing commercial banks, including Bank Andromeda in which Bambang personally held 25% of the shares, on Nov. 1 following an agreement reached with the International Monetary Fund (IMF) to restore the country's economic stability.

The central bank has set aside 2.3 trillion rupiahs in taxpayers' money for every depositor who had up to 20 million rupiahs in the closed banks, while the others will be paid 20 million rupiahs for the time being and have the rest of their money returned after sale of the banks' assets.

The central bank said 93.7% of depositors of the closed banks have accounts containing less than 20 million rupiahs, meaning that most depositors will have their savings returned. Reimbursement is scheduled for Thursday.

At the 10-minute press conference, Bambang said there had been no pressure either internal or external to withdraw the lawsuit filed last week.

Jakarta 'followed proper procedures'

Straits Times - November 11, 1997

Jakarta – Indonesia's Finance Minister Mar'ie Muhammad yesterday defended the closure of 16 banks, asserting the government had followed proper procedures before winding them up in a move to reform the banking sector. His statement, reaffirming the government's resolve to implement the decision, followed a legal challenge brought by a liquidated bank in which a son of President Suharto has a stake.

"Warnings and proposals for improvement issued by Bank Indonesia received less positive responses from the management of the prospective banks...," Mr Mar'ie told a plenary session of Parliament.

He said the government had followed "various stages and processes over a sufficient length of time before the business licenses were revoked".

The banks were ordered closed on Nov 1 after the International Monetary Fund announced a multibillion-dollar aid package to steady Indonesia's faltering economy.

Bank Andromeda, one of the liquidated banks in which President Suharto's son Bambang Trihatmodjo has a 25 per cent stake, sued Mr Mar'ie and Bank Indonesia central governor Sudrajad Jiwandono last Wednesday over its closure. The bank's lawyers said the officials had not followed proper procedures and failed to warn the bank in time.

The Finance Minister said the liquidation of the 16 banks constituted an important element in the government's programme to restore health to the banking sector.

"In order to uphold the rule of law and to maintain Indonesia's credibility in the international community and in the context of restoring health to the banking system, the government will implement its decision announced on Nov 1 and will take all consequences of that," he said.

Commenting on the lawsuit filed by Bank Andromeda, Mr Mar'ie said "any party feeling adversely affected by this decision can pursue the matter through the appropriate legal channels".

Yesterday, PT Bank Dagang Nasional Indonesia said 20 banks had been appointed by Bank Indonesia to help with the liquidation of the 16 banks.

Meanwhile, Minister of Transmigration Siswono Yudohusodo called on Bank Andromeda to withdraw its legal suit for the sake of the country's currency, the Bisnis Indonesia daily reported yesterday.

He said the rupiah would plunge if Bank Andromeda won the suit, and added that the stability of the currency outweighed the bank's right to lodge an appeal.

The rupiah has already lost over a third of its value against the US dollar since it came under speculative attack in July, prompting the government to engage in a tight monetary policy that has slowed the economy.

The minister said the withdrawal of the suit would not damage the credibility of Mr Bambang and might even draw public support.

He was also certain that the bank closure orders were legally correct and in the interest of the nation.

The closure was among the first reforms announced by the government after it received the IMF aid pledge.

Mr Mar'ie said an unhealthy financial sector could trigger a worsening of the economic situation, unless immediate steps were taken to rehabilitate the sector.

He also announced the criteria used to decide on the banks' closure which included insufficient assets to cover liabilities, year-to-year loses due to costs outstripping income amid substantial bad debt, and a weak ability to mobilise funds that led to high-interest money-market borrowings.

Soeharto relatives fuel split over banks

Sydney Morning Herald - November 12, 1997

Louise Williams, Jakarta – President Soeharto's half-brother has refused to withdraw a court challenge to bank liquidations which threaten the Internation Monetary Fund's bailout of the Indonesian economy.

Mr Probosutedjo said the Government may have targeted his bank for closure because it did not "spend enough money" currying favour with officials of the Central Bank, and announced he would refuse to sign the liquidation papers.

Mr Probosutedjo's Jakarta Bank was one of 16 shut under the first round of reforms last week to implement the IMF-led economic rescue package.

The refusal of Mr Probosutedjo and Mr Soeharto's son, Bambang Trihatmodjo, another director of a failed bank, to accept the closures is creating a dangerous rift within the first family over economic reforms.

Bambang, who owned a 25 per cent share in the liquidated Andromeda Bank, and Mr Probosutedjo are due to take their challenge to court today.

The legal case has fuelled fears among foreign investors and donor nations that Indonesia's business and political inner circle will not take their share of the pain under the IMF bailout package.

Mr Probosutedjo yesterday accused finance officials of selecting his bank for liquidation because it had not contributed enough money to them. "Bank Jakarta did not have enough pocket money to maintain a relationship with the Central Bank," he said.

This extraordinary public claim follows Bambang's defence of his Andromeda Bank last week, when he admitted it had broken the law by exceeding the legal lending limits, but said so had 90 per cent of Indonesian banks.

The refusal by members of the Soeharto inner circle to share the suffering of the economic crisis with the Indonesian people has been followed by a further stockmarket slide since last week. Analysts said shares lost 2.6 per cent yesterday, and all eyes were on the legal challenge to the bank closures.

Most foreign investors, and the IMF, are looking for clear signs that the economic reforms will be implemented, in particular the shake-out in the under-capitalised banking sector. The $US38 billion bailout package is the second-largest ever put together by the fund, and follows a 35 per cent depreciation in the rupiah and similar losses on the Indonesian stockmarket.

The target of the legal cases, the Finance Minister, Mr Mar'ie Muhammad, announced yesterday that the Government would not review the bank closures. He said all 16 banks had insufficient assets to cover their liabilities, mainly because of significant bad debts.

The Ministry for Manpower said yesterday about 50 companies had applied for permission to lay off 10,000 workers, on top of about 6,000 bank staff who lost their jobs with the closures last week.

This latest request reflects the inevitable rise in unemployment as the economy contracts. A Government official said the jobs would be lost in the textiles, shoes and plywood industries.

The Indonesian Contractors Association says about two million day labourers have been laid off in the construction industry in Jakarta alone.

The bank cases are taking on increasingly political overtones, with opposition groups seeing the complaints of Mr Probosutedjo and Bambang as symptomatic of a system which has one set of rules for the rich and powerful and another for the poor.

Analysts said they had hoped the legal cases would be withdrawn yesterday, as senior IMF officials arrived in Jakarta for meetings with the Soeharto Government. Economists have blamed the legal challenges for the slide in the rupiah.

The Minister for Transmigration, Mr Siswono Yudohusodo, a Cabinet minister and prominent businessman, said: "Personally, I hope they will consider the greater interest of the country and drop their lawsuits. By doing so they would boost public confidence in the rupiah."

Australian firms told it pays to stick with Jakarta

Australian companies would be "very unwise" to pull out of Indonesia, the Minister for Industry, Science and Tourism, Mr Moore, warned here yesterday, saying the country's economic problems were short-term.

"There's a great future here and for any corporation to walk away would be very foolish," Mr Moore said after meeting Indonesian ministers during his three-day visit.

He said he was confident the Indonesian Government was "truly committed" to meet the conditions of the IMF rescue package for its troubled economy, to which Australia has contributed $US1 billion. However, Mr Moore conceded there would be problems. "It would not be the real world to assume Australia will not be impacted by a downturn in greater Asia, not just South-East Asia, but Japan and Korea as well," he said.

"I can't quantify it, we're in the middle of it, it's happening right now."

Mr Moore also conceded that some bilateral projects would be put on hold as the Indonesian Government pursued an austerity budget and reviewed or cancelled a number of major development projects. But if there was any movement away from the IMF package, he said, it would be "very detrimental to the economy".

The Soeharto Government is facing lawsuits from two members of President Soeharto's family over the liquidation of banks of which they are directors, under the first stage of reforms announced last week.

Can the IMF wrestle down Suharto Inc.?

Business Week - November 10, 1997

Michael Shari in Jakarta and Sheri Prasso in New York – For a region that has felt shock after shock since July, some relief came in the final days of October. The $40 billion International Monetary Fund bailout of Indonesia boosted the rupiah – battered by a 30% plunge since July – by more than 10% and brought a breath of life back to the stock market. Across Southeast Asia, the confidence bought by the infusion helped buttress the currencies and markets of Indonesia's neighbors. For the moment, it seemed, at least one Southeast Asian country was ready to take steps toward abolishing the crony capitalism and unbridled lending that are jeopardizing the region's growth.

Indonesia is the acid test of the IMF's ability to curb the excesses of Asian capitalism. The next few months are critical. The economic downturn has caused at least 2 million layoffs, compounding Indonesia's struggle with devastating forest fires and the worst drought in 50 years. IMF-imposed austerity measures are roiling President Suharto's cronies and family, who are fighting to protect their economic turf. Meantime, Suharto is trying to guarantee a seventh consecutive five-year term as president. Already, student demonstrators are denouncing him. Rioting is predicted. "The challenge is how to implement the package without creating social unrest," says Rizal Prasetijo, economist at Jardine Fleming Nusantara in Jakarta.


How much change the IMF package can bring to Indonesia is hotly contested. Jakarta agreed to remove some import barriers, dismantle part of its food-distribution monopoly, and close 16 banks, including some belonging to Suharto family members. But Suharto will have to stop his family from sabotaging these moves. "There are going to be a lot of problems with implementation," says Nicholas Brooks, an economist with Peregrine Securities Singapore. "The question is in the details."

The main obstacle is the nature of the Suharto system itself. The President's children and friends are virtually synonymous with Indonesian Big Business. At least some of the IMF's attempts to separate the two realms are cosmetic at best. Even though a number of banks are being liquidated, finance-industry sources say four heavily indebted banks avoided the chopping block, perhaps because of their connections to Suharto. They include Bank Yama, owned by Suharto's eldest daughter, Siti Hardiyanti Rukmana, known as Tutut, and Bank Utama, linked to Suharto son Sigit Harjoyudanto. Both banks received infusions of capital from other well-connected banks on the eve of the closures.

Among the well-connected banks that were liquidated, trouble is brewing that will severely test Indonesia's dedication to reform. Another Suharto son, Bambang Trihatmodjo, who owns 25% of liquidated Bank Andromeda, filed a lawsuit against Finance Minister Mar'ie Muhammad, accusing him of a political move to disgrace the Suharto family. Suharto's half-brother Probosutedjo, who owns Bank Jakarta, defied the IMF by keeping his bank open and honoring depositor withdrawals. Whether the political heavyweights will accept their losses remains to be seen. "There is definitely a danger the IMF package could unravel," says Jonathan Harris of HSBC Securities in Jakarta. "Political issues could come back to haunt everyone."

Rice bowl

The IMF plan leaves several controversial projects unscathed. They include the national car program in which Suharto's youngest son, Hutomo Mandala Putra, or Tommy, imports cars duty-free from South Korea. Tommy becomes chairman of Timor Putra Nasional, instead of president, and keeps a controlling equity stake. Even though the company's cars are selling poorly, local banks may still be forced to lend $690 million to Tommy's company so it can start assembly in Indonesia.

The IMF, however, wants to break up the government's food- distribution monopoly, called Bulog, that is run by a close Suharto associate. The fund is angling to open the market to competition. But the new rules leave untouched Bulog's monopoly on rice, Indonesia's biggest farm commodity.

Just a few months ago, any suggestion that Indonesia would close politically connected banks or break up monopolies would have been laughed at. So anything the IMF can achieve is major progress. "This shows they're being firm. That has psychological and political impact," says a banking analyst at a Jakarta brokerage. But the battle between Suharto Inc. and the IMF will be hard fought and prolonged.

Power tariff struggle in Indonesia

Business Times - 8 November, 1997

S N Vasuki, Jakarta – Private power firms, which are investing billions of dollars in new projects in Indonesia, are desperately trying to stall a government move to renegotiate power tariffs.

Though the Mines and Energy Ministry is keen to negotiate lower tariffs due to the economic crisis, analysts warned the move will jeopardise Indonesia's ambitious private power programme.

At stake is the future of the 25 private power firms which have signed power purchase agreements (PPAs) to deliver 9,500 MWs over the next four years. The private firms involved are some of the largest American, European and Japanese names in the business.

The storm started last week when Mines and Energy Minister Ida Bagus Sudjana ordered state-owned utility PLN to renegotiate lower power tariffs with the private power firms. The state utility made it clear that it would not be able to comply with previously negotiated power rates because of the rupiah's steep plunge against the greenback.

"PLN will go bankrupt if it has to buy power at such prices in the future," PLN president Djiteng Marsudi told reporters last week, referring to the high power tariffs negotiated in 1995 and 1996.

What is complicating matters is that the utility is expected to suffer a huge loss in 1997 and 1998, estimated at a stunning US$600 million (S$943 million) and the government is refusing to approve an increase in electricity rates.

The IMF wanted the Indonesian government to slash fuel subsidies and hike power rates as part of its US$23 billion stabilisation package. But the government refused to implement the policy this year and has apparently agreed to a review in late 1998.

PLN officials have said it will have to raise the price of power by at least 35 per cent to cover the cost of buying electricity from private firms.

PLN's major concern is that several major private firms will start generating power in 1998 and 1999 and the utility is not in a financial position to comply with the PPAs. During the boom years of 1995 and 1996, the utility had signed generous deals with private power firms to buy electricity at rates ranging from 6-8 cents per kwh. The rupiah was trading at 2,200-2,400 against the greenback when the PPAs were signed but has crashed to the 3,400 range.

Nevertheless, the energy ministry has reassured private power firms that the government will follow rules in renegotiating the PPAs. It has said the PLN will not force private firms to reduce tariffs, but tell them it can no longer afford to pay the tariffs that were negotiated two years ago.

PLN has been talking to power firm executives in the last few weeks. Analysts said that while the government had made its position clear, the private firms were holding out for more concessions.

"Some firms were willing to slash tariffs provided the government gave them a mandate to develop another power station at the same price," said an analyst.

Indonesia faces IMF praise, strains in week ahead

Reuters - November 9, 1997

Jim Della-Giacoma, Jakarta – Indonesia faces a mixed week ahead with praise expected from the IMF for its economic reform plans, but also the start of a court challenge to cleaning up the key banking sector.

Michel Camdessus, managing director of the International Monetary Fund (IMF), has commended Jakarta's attitude towards reform following agreement on a multi-billion dollar aid deal to stabilise the country's currency and boost the economy.

"Indonesia has had the courage to take the bull by the horns and to take very decisive measures," Camdessus said in Paris last week. "I have full confidence that the government...will get the Indonesian economy on the rails for durable growth."

Camdessus flies into Jakarta late on Tuesday and is due to meet President Suharto the following day to gauge for himself the commitment of the 76-year-old leader who has built his 30-year rule on economic progress.

He will then leave for Singapore on an Asian tour.

Coinciding with the meeting on Wednesday, however, a hearing starts in a court challenge to the government's closure of 16 ailing banks – which included three closely connected to Suharto's family – as part of the IMF-sponsored programme.

Political analysts said the fissures which have appeared in Indonesia's ruling elite are the first of many reform-inspired tremors likely to hit the sprawling country.

Besides thousands of confused depositors who milled outside branch offices of the closed banks, the loudest howls of outrage came from Suharto's own relatives.

The president's second son Bambang Trihatmodjo and Suharto's half-brother Probosutedjo cried foul after Bank Andromeda and Bank Jakarta, in which they hold stakes, were included in the list.

Both banks rushed to file legal challenges.

Trihatmodjo accused Finance Minister Mar'ie Muhammad of trying to hurt Suharto's re-election and discredit the business-oriented First Family while his father was abroad.

He later adopted a lower profile, leaving his lawyers to do the talking after his politically astute elder sister Siti Hardiyanti Rukmana backed the closures – as well as the right of every citizen to have their day in court.

"These packages aren't easy. These are the kinds of stresses we are going to see more and more," one analyst said, commenting of the First Family's public spat.

State Secretary Murdiono handed down the official line on Friday when he said the government stood firm on the bank liquidations, which analysts said signalled Suharto backed the order.

Bank Andromeda, 25-percent owned by Trihatmodjo, has led the court challenge, with a judge opening the first hearing in chambers in the Jakarta Administrative Court on Wednesday in a pre-trial bid for an agreement.

Bank Jakarta, chaired by Probosutedjo, followed Bank Andromeda in suing the finance minister to have its closure reversed. A third bank, Bank Industri, partly owned by Suharto's second daughter Titiek Prabowo, has not signalled its intention to challenge the closure order.

The director of the Econit Advisory Group, Laksamana Sukardi, was quoted as saying during the week the law suits were the right of every citizen.

"This will serve as a test to our court system, to see whether our bank, company or liquidation laws work," he said.

Political scientist Juwono Sudarsono said in an interview last week much was at stake for Indonesia, which was founded on the principles of a caring state looking after the basic needs of the poor, unskilled and deprived.

"But no country can escape the volatility of global capitalism," he was quoted in the Jakarta Post daily as saying.

"The question now is whether we can still be committed to translate our constitutional ideals into concrete reality in the face of global market forces which tend to benefit the privileged few," Sudarsono said.

"That creates jealousy, anger and frustration among the poor, the unskilled and the less well-connected, often leading to unilateral and violent action," he said.

Layoffs from building sites hit by a credit squeeze of high interests are already obvious on the streets of the capital as thousands of daily labourers wait in vain at curb-side pickup points for employment.

The capital, with its factory belt on the outskirts and booming skyline in the centre, has been a magnet for migrant workers from the drought-stricken countryside of densely-populated Java island.

But economists such as Kwik Kian Gie said Indonesia, accustomed to decades of rapid growth, now had to adjust to the reality of a severe economic slowdown.

"Business confidence in Indonesia is unlikely to recover in the next three years because international investors know that Indonesia is entering a recession and that the IMF's reform package is constrictive by nature," Kwik wrote in a column.

Live broadcast of hearings on financial crisis is banned

American Reporter - November 13, 1997

Andreas Harsono, Jakarta – Indonesian journalists are protesting a government ban that has kept two private television channels here from airing live a parliamentarian hearing on Indonesia's financial crisis, saying that government had violated press freedoms and manipulated the Broadcasting Law.

"It shows again that that the Press Law and the Broadcasting Law are effective on paper only. They have no power when standing in front of the government, and even become a tool to legitimize the government's decision," said Lukas Luwarso, president of the officially-unrecognized Alliance of Independent Journalists (AIJ).

Information Minister R. Hartono earlier this week prohibited two private television stations, AN-teve and SCTV, from broadcasting live the plenary session on Monday [Nov. 10] of hearings by the House of Representatives on the nation's economic crisis, including a speech by Finance Minister Mar'ie Muhammad.

Mar'ie was to give a speech about an International Monetary Fund reform package that included the liquidation of 16 banks, some of which belong to members of President Suharto's family.

Although AN-teve and SCTV had obtained permission the night before from House Speaker Harmoko, a former Information Minister himself, to broadcast live, government authorities informed the two television stations that they would be prohibited from broadcasting live the proceedings.

Journalists and workers of the two stations stood idle during the hearing as their equipment, including satellite dishes, communication trucks and several cameras, were only allowed to record part of the packed hearing on the $23-billion IMF bailout.

President Suharto last month asked the IMF to help heal Indonesia's ruptured economy after the value of its currency, the rupiah, decreased by about 35 percent since July.

Speaking to reporters, Hartono, a former army chief, said that he had based his decision on the newly-passed Broadcasting Law, claiming that private television stations could not broadcast live events from the parliamentary house.

"A private television violates the rules if it broadcasts live coverage without informing the government. This should not happen again," said the minister, who is widely known to be a close associate to Siti Hardiyanti Rukmana, Suharto's eldest daughter.

"Is it that difficult for a private station to ask for our approval if it intends to run live or delayed broadcasts?" asked Hartono.

However, he failed to elaborate on which sections of the Broadcasting Law stipulates the ban.

Media analysts said the law contains no sections which regulate live broadcasts from the House. The law in fact permits private television stations to broadcast live events alongside the state-own TVRI.

"The minister has manipulated the law," said Luwarso on Wednesday.

Sofjan Lubis of the government-controlled Association of Indonesian Journalists, however, said that he could "understand" Hartono's decision.

Sources within both AN-teve and SCTV said that they had received phone calls from an aide to Hartono on the eve of the hearing in which he ordered the channels to cancel the live coverage.

The ban sent a mixed signal to media observers here. It is not clear in whose interest Hartono had based such a controversial decision, since both channels are owned by people close to the Suhartos.

SCTV is controlled by Halimah Trihatmodjo, wife of Suharto's middle son Bambang Trihatmodjo, who had earlier filed a lawsuit against Finance Minister Mar'ie over the closure of Bambang's Bank Andromeda.

Bambang, however, humiliated himself in some eyes on Wednesday when he announced that he had decided to withdraw his lawsuit from a Jakarta court, saying that he had done it in "a broader national interest."

His remark prompted speculation here that President Suharto himself had asked his son to stop the suit.

Indonesian tycoon Aburizal Bakrie, of the widely-diversified Bakrie Brothers, is the major shareholder of the Jakarta-based AN-teve, whose president is Agung Laksono, a member of the ruling party Golkar's inner circle.

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