Indonesia resources links maps acronyms instant books  


Back to Instant Indonesia
The economical situation in Indonesia has been thoroughly described by Rickard Robison in Indonesia - The Rise of Capital. In it, he identify three different actors on the economical scene. I will here describe them in a few words.

The State Corporate Sector and State Managers of Capital
This is the largest sector and most crucial element of domestic capital in Indonesia. It is upheld by the state for several reasons. The state fears that a let-over to indigeonous entrepreneurs, pribumi, who are weak, would be like giving the Indonesian economy away to Western and Chinese capital. Further, since the State is strong, it can lead the way for pribumi later on by developing industries and build a functional infrastructure.

The Military-Owned Business Groups
The military has been involved in the economical sector since the war, and has never let go of that involvement. In the early 1950s, it was primarily to raise extra-budgetary revenue for the operations of individual commands and units as well as for the personal and political needs of individual officers and political factions. These economic activities ranged from illegal levies on businessmen to smuggling and providing protection.
   Today the military-owned businesses operate in most areas of domestic investment and are partners in a range of joint-ventures with foreign and Chinese partners. But the real significance of the military companies lies in the crucial role they play in relation to the state and to the structure of the emerging capitalist class.


Chinese-Owned Capital
After 1965 the Chinese economical activities began to prosper. Under the Sukarno era, the goal was to build a strong pribumi class who could build a strong Indonesian economy. The Chinese suffered under discriminatory restrictions and couldn't grow at the rate they had capacity for.
   Suharto, on the other hand, seemed more interested in economic prosperity, no matter who it was who made the money. The Chinese took the opportunity and some of the Chinese businessmen are today amongst the richest people in the world.
   A fenomena that developed during that period was the so called Cukong system. Cukong is Chinese for Master or Lord, and it was really two masters going steady. The master of capital was the Chinese and the master of politics was the Indonesian, almost always military men. The most capital generating Cukong relation was between Suharto and Liem (aka Salim).
What's more
This is of course only a short summary of economic activity in Indonesia, it is supposed to be instant, isn't it?
   I can really recommend the book by Robison, and also the book by Adam Schwarz, A nation in Waiting - Indonesia in the 1990s.

Short economical facts.

Population Geography Politics Economy Religion East Timor