In the first part of our special report on the Indonesian economy yesterday, we looked at the controversial issue of fuel and food subsidies and the millions of Indonesians who are still mired in poverty

While Indonesia's middle class do not have to worry about their next meal, many of them are still going easy on imported goods and luxuries.

In the second of a two-part special report, The Straits Times looks at the wary mood that is still pervasive two years after the economic crisis.

Robert Go, Jakarta – Locally-made margarine instead of foreign, fewer holidays abroad and, sometimes, cutting out visits to the doctor altogether. Two years after the economic crunch, Indonesia's middle class are still having to keep a wary eye on the family budget.

Crismon – the popular shorthand term here for "crisis monetary" – reined in their growing consumption of imported goods as the drastic devaluation of the rupiah put a severe crimp on their purchasing power.

Latest statistical indices show some price stabilisation or even deflation in the last two years, but the consumption level of commodities usually associated with the middle-class lifestyle is still lower than in 1996.

"There is a noticeable change in spending pattern with people concentrating on essentials and forgoing items that can be substituted," said Mr Bambang Sabarudin, head of Consumer Price division at Indonesia's Central Board of Statistics.

While none claimed starvation, households interviewed by The Straits Times reported having to spend more but getting less in terms of quality and quantity.

"Things that we cannot substitute we still buy, but for extra items, we try to hold back or spend money on cheaper alternatives," said Mrs Lusi, a housewife from Surabaya. Explaining her budgeting practices, she said that before the crisis she bought imported Australian margarine, but the domestic Blue Band has become her family's current brand of choice.

American-made Mazola cooking oil, which cost approximately 17,000 rupiah (S$3.60) in 1996 but rose to over 35,000 rupiah, is substituted with Sunrise, priced at 22,000 rupiah at her local supermarket.

Mrs Lusi considers herself middle class. Her husband works for a foreign manufacturing company. Their monthly family budget before 1997 was approximately two million rupiah, but has since ballooned to reach 3.5 million rupiah.

Other means of cutting cost for the middle class include reducing spending on clothing, jewellery, property and luxury cars. Some families say they have cancelled foreign travel plans and vacationed at destinations within Indonesia.

Some even cut back on health care, choosing to see local dukuns or traditional healers instead of consulting a doctor. "People report to us that they had to choose alternative treatment such as going to unlicensed traditional health practitioners or taking traditional potions to treat their illnesses," said Mrs Indah Suksmaningsih from the consumer group YLKI.

Patronage of restaurants, another important gauge for middle- class consumption, also dropped significantly, even at popular, medium-priced establishments located in middle-class neighbourhoods. "We had 30 per cent fewer customers up until a few months ago, when things started to get better," said a worker at Twilight Cafe, one of Jakarta's popular eateries.

Ms Irene, a recent college graduate living in Jakarta, described her favourite hangout spot, the food court at Taman Anggrek shopping centre, as a convenient place that offers variety at a low price.

She admitted frequenting the noodle stall with her friends before they went shopping. "We still go to places like Pizza Hut ... but we spend half the money by going to regular stalls at the food court," she said.

If the middle class exercised firmer hands on the purse strings when purchasing daily necessities, they also practised delayed gratification in making larger spending decisions such as on travel and cars.

Some families said they had cancelled foreign vacations because of a higher tax charged by the Indonesian immigration authorities on citizens travelling abroad as well as pricier airfare and accommodation costs.

Ms Regina, a medical student at one of Jakarta's leading universities, said: "We planned to spend Christmas 1998 in Sydney, Australia, but then decided it was too expensive."

Her family ended up spending a week at the Hard Rock Beach Club in Kuta, one of the poshest resorts in Bali. They were not too disappointed, she said, because they still got to spend the holidays together.

Saleswoman Yuli, who works at one of Toyota's dealerships in Jakarta, confirmed that the car market slumped as prices increased. Priced at 45 million rupiah in 1997, the Kijang, Indonesia's most popular car model, is now being sold at over 130 million rupiah. "People still came in to look at the new models, but they were just looking," she said.

Business is picking up, however, at least for the first part of this year. Toyota's head marketing office recorded a national total of 29,086 units sold during the first three months of 2000, compared to 22,877 for the same period last year.

That middle-class membership definitions change from one person to the next presents a big problem for those trying to address the issue.

Mr Frans Bararualo, an economist at Atma Jaya Catholic University in Jakarta, said: "We can't describe an average living standard in Indonesia since each province differs in characteristics and costs from the others."

But Mr Hajadi, Ciputra Group's Managing Director, defines Indonesia's middle class as white-collar professionals earning above 3 million rupiah a month.

He believes confidence is returning to the domestic market, especially since the election of President Abdurrahman Wahid last October.