Tim Dodd – The management of one of Indonesia's largest and most promising companies was ousted yesterday at an extraordinary general meeting of shareholders in Jakarta.
Rini Soewandi, the young and dynamic chief executive of the country's largest car maker, Astra International, is looking for another job today even though she engineered the company's recovery from the 1997-99 economic crisis, during which Indonesian vehicle sales fell from more than 400,000 to about 50,000 a year.
As a business achiever, Soewandi is right up there. But yesterday's coup at Astra had little to do with her management skills. She fell victim to the power struggle between the President, Abdurrahman Wahid, and the man who is emerging as his chief opponent, Muslim leader Amien Rais.
The new divide in Indonesian politics appears strange at first. Wasn't Rais the president's main ally in the election last October? Yes, he was. The two did a deal which ambushed Megawati Soekarnoputri and installed Rais as Chairman of the People's Consultative Assembly and elevated Wahid, the outsider, to the presidency.
Superficially, the two have common ground. Both are former Muslim leaders, and each headed one of Indonesia's two largest Muslim organisations. Wahid was the chief of the Nahdlatul Ulama, a 30 million-strong body with a power base in rural Java, where Islam mingles with traditional Hindu and mystic beliefs in a mix unique to Indonesia. Rais headed Muhammadiyah, a smaller group whose predominantly urban and more middle-class following is much stricter in its Islamic belief.
But the groups, while both Muslim, are as unlike as Catholics and Protestants and, like the Pope and Billy Graham, they don't get on. Wahid and Rais also have a personal history of antagonism and, not surprisingly, their political marriage of convenience has not lasted. Both have reverted to their political roots.
Wahid is backed by his National Awakening Party, which is rooted in the Nahdlatul Ulama organisation, as well as the nation's largest political group, the Indonesian Democratic Party of Struggle headed by Vice-President Megawati. His group has a secular outlook with strong links to the Christian and Chinese communities.
Rais is backed by a wide coalition of so-called modernist Muslim parties, whose followers are generally richer, better educated and more literal followers of the Koran than the traditional Muslims of Wahid's Nahdlatul Ulama. This so-called "Central Axis" draws support from Muslims concerned about Chinese domination of the economy. It is also a focus of discontent for those concerned about Indonesian assets being sold to foreigners at fire sale prices to pay for the country's bank bailout.
A key financial and political backer of the Central Axis is Fuad Bawazier, finance minister in Soeharto's last cabinet, who still has close links to the Soeharto family. Bawazier played a key role in bringing Rais and Wahid together back in July and in building support for Wahid's presidential bid.
But the Central Axis did not win many of the plumb positions in the new government. The Finance Minister, Bambang Sudibyo, is a Central Axis man, but this is the only key job held by the group. Bawazier himself missed out on a place on Wahid's National Economics Council.
Within Astra, this wider political struggle is being fought on a smaller scale. Astra's Soewandi-led management is closely linked to the Central Axis, and Soewandi herself is friend of Bawazier's.
Waiting in the wings are the Soeryadjayas, the Chinese family which founded Astra but lost it in 1992 when its banking group crashed. The meeting which sacked Soewandi yesterday replaced her with a Soeryadjaya cousin, Theodore Rachmat, a former Astra chief executive.
The Soeryadjayas, who have close links to Wahid, would like to regain control of Astra. A 45 percent stake in the company worth about $800 million will soon be put on the market by the Indonesian Bank Restructuring Agency (IBRA) the body which has picked up the assets of the failed banks and has to sell them to help fund Indonesia's $130 billion bank bailout.
The Soeryadjaya's are tied to one of the consortia seeking to buy the 45 percent stake. Edwin Soeryadjaya, son of Astra founder William Soeryadjaya, is advising US firms Gilbert Global Equity and Newbridge Capital in their bid. Until recently IBRA, under a Wahid-appointee, Cacuk Sudarijanto, was giving the Gilbert-Newbridge bid a clear run. But it had to let other bidders into the auction after a strong campaign led by Soewandi who refused to let Gilbert-Newbridge advisers see Astra's books.
Astra is just one skirmish in the battle developing between Wahid and the Central Axis. But it is important because of the way it has been played by the Wahid administration. Will political interference in IBRA's sales program, which could be worth $20 billion, become the norm?
Wahid must be tempted by this opportunity to consolidate his support by ensuring that Indonesia's key businesses are controlled by his friends. Time will tell whether or not he succumbs.
Unlike the Soeharto years, there is an effective opposition led by Rais. And once a year during Wahid's five-year term the People's Consultative Assembly which elected him will review his performance. It can even sack him. The assembly, chaired by Rais, meets in August. Expect a fascinating sitting.