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Indonesian oracle, or oddball? B.J. Habibie divides a nation

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Washington Post - February 19, 1998

Keith B. Richburg, Jakarta, For some, B.J. Habibie is a visionary, an ardent economic nationalist and the very image of a thoroughly modern Muslim intellectual. He inspires millions with his grand plan to transform Indonesia into a leader of industry and high technology for the next century.

For others, B.J. Habibie is a dangerous eccentric who uses his proximity to an aging president to push his economic theories and a raft of grandiose, ill-conceived plans that are a drain on the national treasury.

Those two opposing views, however extreme, neatly summarize the intense feelings engendered among supporters and detractors of the man who may become Indonesia's next vice president.

"Habibie is a very divisive presence, not only in society but also within the military," said an Asian diplomat with long experience here.

For years, critics could dismiss Habibie, Indonesia's research and technology minister, as a bit of an oddball and a maverick, albeit an influential one who has President Suharto's ear. But now Habibie, 61, stands on the verge of becoming Suharto's number-two man – and the country's next president if Suharto, 76, is unable to complete his next five-year term.

Today, Habibie moved a step closer to the vice presidential post that had eluded him in 1993. The leadership of Indonesia's powerful armed forces this morning officially threw its support behind Habibie for vice president, and the outgoing commander, Gen. Feisal Tanjung, praised him as "the best figure to accompany . . . Suharto in carrying out the duties of the nation and the state for the next five years."

While Suharto has yet to make his own choice public, Habibie already had won the endorsement of Indonesia's three officially sanctioned political parties and the country's 27 appointed governors. But the support of the military, which enjoys a constitutionally enshrined role in politics, is crucial because it is considered the country's most cohesive institution and the final arbiter of power.

Because Habibie had never worn a uniform, the level of support for him within the military's ranks had remained a large question. But Feisal said today that Habibie's lack of a military background is not a factor. "Abri has never considered the background of the candidates, whether or not they are civilian or military," he said, using the term by which the armed forces are known. "For Abri, what is most important is the best candidate."

"I think Minister Habibie is a shoo-in now," said Eugene Galbraith, head of research in Hong Kong for the securities firm ABN Amro Asia Ltd., who spent 16 years in Indonesia and is considered an expert on the country.

"It's a terrible decision," Galbraith said. "He's venal and corrupt, but he gives the impression of being a visionary. . . . He's kind of a proven spendthrift. He's someone who doesn't have very good political instincts in terms of forging coalitions and building a consensus."

But Dewi Fortuna Anwar, a political scientist with the Indonesian Institute of Sciences and an admitted fan of Habibie, said: "I think he's been given an unfair reading. I think a lot of the younger generation will support him because of his vision. He does have the vision, and I think he does excite a lot of people in that way."

One of Habibie's more controversial moves was using his clout with Suharto to force the military to purchase some components from "strategic industries" that Habibie himself controls. That perceived interference in Abri's procurement process is believed to have earned him the permanent antagonism of some key generals. In addition, Suharto in 1990 placed Habibie at the head of a new group called the Indonesian Association of Muslim Intellectuals. The group has given the minister a broad base of support for his unconventional economic theories – often called nationalist economics, or simply "Habibienomics."

"There's an ideological element to it," said an Asian diplomat, explaining the core of Habibie's support and the unlikely and sometimes disparate coalition of Islamic fundamentalists and urban intellectuals who back him. "There's the attraction to high technology as a way to counter the West."

He also said many indigenous Indonesians support special government breaks for their businesses to counter the perceived special privileges enjoyed by the country's ethnic Chinese minority, who control 70 percent of private wealth here. "They want to put the Chinese in their place," the diplomat said.

Habibie's Muslim power base, however, is seen in some circles as a liability. The armed forces – which are decidedly secular – are suspicious of Islam as a political force in Indonesia, the world's most populous Muslim nation.

"Among the older generation, anything smacking of Islam is suspect," said Anwar, the political scientist. But she added that "Indonesia is not going to be an Islamic country," and in her view, a future president Habibie might be confident enough to allow greater democracy in what is now a largely autocratic state.

But Habibie may not make it that far. Suharto, set to be reelected for a seventh consecutive five-year term next month, has shown no indication of stepping down. In fact, observers say, Suharto is already busy mapping out measures and reforms extending well into his term.

"The only spin that could be put on Habibie is that this is an act of consummate political cynicism [by Suharto]: 'The alternative is so bad, you have to put up with me,' " Galbraith said. "If I were Suharto, appointing Habibie may not be that bad an idea."

But Habibie's influence always has come not from the positions he has held but from his closeness to Suharto, whom he publicly has said he regards as a father. Habibie reportedly refers to Suharto with a mixture of chumminess and obsequiousness, calling him "SGS," which stands for "Super Genius Suharto."

The unlikely friendship between the president and ex-general and the German-trained engineer began more than four decades ago, when Suharto was a young officer serving with a unit in Sulawesi, just across the road from where Habibie's family lived. The young boy and the officer became close, especially after Habibie's father died when the boy was 13.

Habibie worked with a German aircraft firm in the 1960s and 1970s – rising to become vice president for applied technology – and returned to Indonesia, according to popular accounts, only at Suharto's request.

Habibie took over the government's research and technology portfolio and used it to pursue his grand scheme of transforming Indonesia – always with Suharto's tacit backing. His 10 major projects, grouped under the heading "strategic industries," include the state-owned IPTN aircraft manufacturer, a steel refinery and various defense-related industries.

Habibie became the government's most vocal and visible counterweight to Suharto's economic technocrats – the mostly Western-trained economists and academics who have guided Indonesian economic policy for more than 20 years from the Finance Ministry and the central bank.

Habibie sees the technocrats as small thinkers who have allowed Indonesia to be exploited by foreign capital and left at the mercy of overseas markets. Their push for more open markets, less government intervention in the economy, lower tariffs and more liberalization have, in his view, widened the gap between rich and poor and been detrimental to the Muslim majority.

But Indonesia's current economic crisis, which sent the currency into a free fall, has caused the technocrats to quickly fall out of favor. They negotiated, and pushed Suharto to sign, the International Monetary Fund bailout agreement. The $43 billion pact seeks to open the economy further and eliminate state subsidies to some of Habibie's pet projects as well as to the national car company run by Suharto's son Tommy.

But Suharto is said to be growing impatient that the plan has not yet shored up the battered currency nor led to an economic turnaround. The firing this week of the central bank governor, Sudradjad Djiwandono, was seen here as another sign that Habibie and the economic nationalists are in the ascendancy.

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