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Indonesia: Terrorist Redoubt?

GlobalPost correspondent Peter Gelling discusses how the terrorist attacks in Jakarta and violence at the Freeport mine in Papua will affect the booming economy and seemingly-stable democracy.

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[Editor's Note: The following is a transcript of the Correspondent Call with Peter Gelling.]


Passport: Good afternoon and welcome, I’m David Case, Editor of GlobalPost Passport in Passport/GlobalPost newsroom in Boston. Today we’ll be discussing the recent developments in Indonesia.


At the start of this decade, the world’s most populace Muslim country was an emerging market basket case. A deeply corrupt, unstable country, with a dysfunctional economy, a terrorism problem and weak leaders. On July 8 of this year, President Susilo Bambang Yudhoyono won reelection by a landslide, largely because of progress he had made since 2004 in tackling these problems. SPY, as the President is known, arrested terrorists, cracked down on corruption, and kept the economy growing, even while the rest of the world slumped into the economic crisis.


The two weeks since the election have been another story. On July 17, two Jakarta hotels, the J.W. Marriott and the Ritz-Carlton, were attacked by terrorists, killing nine, including two suicide bombers. Thousands of miles away, at the opposite end of the archipelago, violence has once again erupted at the Freeport copper and gold mine in Papua.


With us to discuss this is GlobalPost’s Jakarta correspondent, Peter Gelling. Peter, who has written for the New York Times and the International Herald Tribune, has covered Indonesia since 2005. He just flew in from Jakarta and joins us today from Whayland, Mass. where he’s unfortunately recovering from a trans-Pacific cold.


I have a couple of brief announcements before we begin. The call is being recorded. The audio and a transcript will be posted on Passport’s website. Regarding the format, I will lead a twenty-minute Q and A, after which we will let you un-mute your lines to ask questions. The call will end after about thirty minutes.


Ok, Peter. Let’s put the recent developments into context. During President Yudhoyono’s first term, during 2004-2009, Indonesia went from a place where the US was deeply concerned about terrorism to almost a textbook example of how to combat militant Islam. Do these bombings cast doubt on Indonesia’s widely praised counter-terrorism program?


Gelling: Hi, David. No, I don’t think so. I think the efforts by the Indonesian government to crack down on terrorism stand and the successes remain. The Southeast Asian terrorist network, Jemaah Islamiya, the militant wing of that network has almost been completely dismantled with the arrests and killing of most of its leaders. What we had last Friday was the result of an incomplete effort. There’s still more to be done, but Indonesia’s approach, both with police and also with trying to change the hearts and minds of fundamentalists in the country has been very successful and the government deserves credit for the progress its made.


Passport: You say that there’s still work that needs to be done. What are the holes in Indonesia’s counter-terrorism program at this point?


Gelling: Well, one of the problems is, these fundamentalists, radicals, they have a small, but strong, network, social network, supporting each other and the Indonesian government, at times has been, I wouldn’t say unwilling, but hesitant to go after some of these networks because it actually might appear un-democratic. For instance, the publishing industry, the radical publishing industry, has been allowed to continue unabated, which is where a lot of these ideas get passed around. Because the Indonesian government doesn’t want to crack down on free speech. Also, its Islamic boarding schools that are known to harbor radical thoughts. So in those respects, the Indonesian government has to find some sort of way to regulate those networks without sacrificing the democratic freedoms the Indonesia has come to enjoy.


Passport: Indonesia is reputed to be a moderate Muslim majority country with a thriving democracy. Is that still true? What are the trends now? Are people becoming more conservative?


Gelling: No. I think that Indonesia certainly is still a moderate Muslim majority country and it is still definitely a thriving democracy. I wouldn’t say that people are becoming more conservative, the average person on the street is moderate. I think what it is is the small number of conservatives are having a more powerful voice these days with democracy they’re more free to express their ideas. And so they’re… we’re just hearing from them more. And I think that also the conservative group of … the conservative groups are adept at using the democratic system for getting their ideas across, for lobbying lawmakers and things like that. They’re much better organized even though they’re still such a small part of the population.


Passport: These most recent attacks are being blamed on Jemaah Islamiya. What is the current status of this organization?


Gelling: Actually, the current attacks are not necessarily being blamed on Jemaah Islamiya. They’re being blamed on a man named Noordin Mohammed Top, who once belonged to Jemaah Islamiya, but has since splintered off into a separate group that includes some Jemaah Islamiya members. But generally, Jemaah Islamiya itself still exists as a broad network of like-minded individuals – people who would like to see Indonesia become an Islamic state. But generally, the militant wing of Jemaah Islamiya has been dismantled and it no longer poses as much of a threat of violence. And so that’s one of the ways that the Indonesian government has been very successful in cracking down on terrorism. But it does still exist, so people like Noordin Top are able to recruit from these Jemaah Islamiya circles. But it’s not the coherent, strong organization it was five, ten years ago. It’s all over the place. It’s very disparate at this point.


Passport: What do we know about Noordin Top, who’s been accused of being the mastermind of the attacks?


Gelling: We know he’s Malaysian born, first of all. And he’s also been the mastermind behind most of the attacks on Indonesian soil. Most importantly, what we know about him is that he is a very cunning recruiter and has been able to time and time again, despite arrests and raids and things like this by the Indonesian police, as long as Top has escaped, he has been very quickly able to recruit more people to his splinter organization. He’s been able to convince people to espouse violent tactics to reach their goals, their ends. And that is probably what’s most dangerous about him.


Passport: That’s an important qualification for somebody who’s running these types of operations. How does he manage to always avoid capture? How does he rebuild his organization after so many raids and arrests we hear about in Indonesia?


Gelling: Well, part of the reason he avoids capture is even though it’s a small network, he does enjoy support throughout the country, you know, in small circles, and he’s being protected. And a lot of the former Jemaah Islamiya members, who maybe no longer support violent methods, they still believe in what Noordin M. Top is fighting for and are unwilling to turn him in and, in fact, often are protecting him. I mean, just a couple days ago, the police said that they thought Noordin M. Top was close to the J.W. Marriott at the time of the bombing. And a few weeks ago, the police arrested one of his close associates. And it’s believed Noordin M. Top was there with this man at that time, but just slipped out at the last second. So Top has been very nearly arrested on so many occasions, but he’s always managed to escape and, yeah, he enjoys enough support that he’s been protected. And then as far as rebuilding, it doesn’t take a whole lot of people to pull off these kinds of bombings and with his ability to recruit, it doesn’t take him long to go to these Islamic boarding schools are poor areas, rural areas, to convince some people to join up.


Passport: Ok, lets turn our attention to the attacks near the Freeport mine. There have been a series of shootings and ambushes. Officials tend to blame these on the Free Papua movement, an indigenous separatist group, but human rights monitors say that the insurgents lack the sophisticated arms involved in these types of attacks. What’s going on there?


Gelling: The situation at Freeport is complicated, obviously. The Freeport mine is obviously a symbol of Jakarta power and so it has often been the subject of attacks from the Free Papua movement. But generally, those attacks have been on a very low scale. And the Free Papua movement is tiny and they’re not known to have many weapons at all, if any weapons. So the idea is that possibly the police and the military are behind some of these attacks. Because Freeport pays, either directly or indirectly, money for protection from the police and from the military. And so the police and military staged these attacks to justify their, you know, to justify getting paid. What’s some of the evidence that supports this is some of the bullets that were found at the scene at this most recent shooting all matched guns that were used by police and military. And the whole situation resembles the shooting in 2002 where an American teacher was killed. And it was the same situation. A Papuan separatist was put in jail for it, but the evidence points to military weapons being used during the shooting. And there’s a lot of human rights organizations who believe the wrong people are in jail for that.


Passport: Ok, if the military might be involved, how does all this… let’s talk about both the latest bombings and the attacks on Freeport… how does it all reflect on President Yudhoyono?


Gelling: It doesn’t reflect well, that’s for sure. And his response to these events have been a little bit bizarre.  You know, after the bombings he suggested that it might have been the work of his presidential rivals, which caused a lot of uproar in Indonesia and he, in a sense, backed away from that. But, I think Yudhoyono has been credited with a lot of success, in making a lot of progress in both these areas, with security, which, in turn, has encouraged foreign investment. I don’t think you can blame Yudhoyono for these last two events. But I think we’ll see in the next few years, I think this is when we’ll see how effective Yudhoyono can be. Because now he should really have free reign to make the reforms that are needed to improve the security situation in Indonesia.


Passport: Ok, let’s turn our attention to the Indonesian economy. Will all this violence spook investors who are becoming interested in Indonesia again after so many difficult years?


Gelling: No, it doesn’t seem like it. With the bombing of the J.W. Marriott, it seems that one of the targets was a meeting of foreign businesses, foreign mining companies. It’s a breakfast meeting and it happens weekly. It’s chaired by Jim Castle, an American businessman working in Jakarta. He’s probably one of the more influential to foreign businesses working in Jakarta. And he himself in the days after the bombings has said that it’s very unlikely that this will affect foreign businesses’ perception of Indonesia that severely. That he’s received many emails and phone calls saying just that. And the bottom line is that the Indonesian economy and the fundamentals of its economy are very good. It’s still a very attractive place to invest even if you have this flash in the pan event that happened last Friday.


Passport: What about the current sentiment on the ground in Indonesia? Talk about both… you’ve already talked somewhat about how things have changed after the bombing. But the elections went very well; they were peaceful. In the past, elections were a major source of headaches for the Indonesian people. Are people as optimistic on the ground as they seem to be from afar?


Gelling: No. I think on the ground, yeah, your average Indonesian is fairly optimistic, but when I talk to my neighbors about this kind of thing, they’re very suspicious. They have a “wait and see” sort of attitude. Everyone I’ve spoken to voted for Yudhoyono across the board because they like the way things are going, but they remain unconvinced. And I think this is partly a result of decades of mistrust that’s been built between the Indonesian public and the government. And now, to them, they see this next five years of Yudhoyono as the real deal, the real test. If progress continues to be made, hopefully faster progress, and then he steps down, they have another election, peaceful election, I think then people will start finally believing in this democracy they’ve been hearing so much about.


Passport: One of the targets of this kind of attack has to be tourism, an important business for certain parts of Indonesia, especially Bali. What can we expect now, after the most recent attacks?


Gelling: It might be too early to tell. But there was a slight drop in tourist arrivals in the days after the attacks. But, you know, looking at Bali, Bali has broken almost every record, as far as tourist arrivals are concerned, this year. And it doesn’t seem like these bombings will have much of an affect on that. First of all, it was in Jakarta, not in Bali, and I think the security in Bali has been improved dramatically, you can really see that. So I think people feel pretty confident about their safety in Bali. And you know, it’s been four years since the last bombing. And ultimately to a lot of the tourists I’ve spoken to, in Bali, they have a mentality that it can happen anywhere and the fact of the matter is, Bali is still an incredibly amazing tropical destination, so they’re willing to take the risk.


Passport: Shifting back to the economy, in the first half of 2008, food and fuel inflation had a deep impact on Indonesia. Is there any sign of it returning? And if it does, to what extent will it be a big issue?


Gelling: Well, as far as food inflation is concerned, it doesn’t look like this will be a problem, partly because they’ve had record crops over the last year. So they have a lot of stores that can weather any shortages or price increases. So nobody really expects there to be a major leap in food prices in the next six months to a year. And with fuel, Yudhoyono has managed to decrease the subsidy many times and has shown a willingness to, in fact, to bring that subsidy back if fuel prices get too high to insure that the Indonesian public isn’t paying too much. I think there is a real concern among the government that if food prices and fuel prices get too high, it could cause real problems here. When you have a population of 120, 130 million people, half the Indonesian population living on less than two dollars a day, when the price of soybean goes up, it can have dramatic results. And so, I think the government has prepared fairly well for that possibility and has protected itself.


Passport: Corruption remains a major problem in Indonesia. Before we go to open the lines up to questions, can you tell me, how willing is President Yudhoyono, at this point, to deal firmly with corrupt business families? Are we going to see some of the oligarchs under pressure in his second term?


Gelling: (Laughing) Yeah, that’s a good question. We don’t know yet. Everybody hopes so and everybody, I think, is expecting to. Yudhoyono has a mandate now, he has no reelection to worry about, so this is his time where he should be able to really focus his energies in rooting out corruption and going after some of these oligarchs, these families. If he doesn’t, it will be very telling, we think. This is his moment and if he can’t pull it off, then I don’t think he was ever serious about cleaning out corruption to begin with.


Passport: Ok, I’d like to open the call up to questions now. If you do have a question, you can let me know by pressing *6 on your phone, that will un-mute the line. I will then call on you using the last four digits of your phone number. Let me start out with 8124?


Caller 1: Hi, this is David Reedle. Following up on the oligarch question, the head of Boomy Resources, I think it’s the Bakrie family? I guess the main guy there was a supporter of the opposition, do you think he’s going to be under pressure in this administration?


Gelling: Aburizal Bakrie, I think is who you’re talking about. He was a minister in the economic cabinet, and yeah, he supported Jusuf Kalla, the opposition, but that’s the question. Bakrie was once a supporter of Yudhoyono in the first election, and hopefully that won’t deter Yudhoyono from cracking down on this family, from removing their business from politics, but that’s yet to be seen. Yudhoyono might feel that he owes Bakrie something, in which case we won’t see that happen, which would be a major disappointment.


Passport: Ok, can I call on 6403 please?


Caller 2: Ok, my question is this. What positions, if anything, in the new cabinet that will be announced in October do you think that Sri Mulyani might have? And also can you speculate on who might be appointed Minister of Finance? This is in the context, of course, of the question of good governance and competence versus political parties allied with the democrat party that is with SBY putting their own hacks in position.


Gelling: As far as Sri Mulyani is concerned, at first it seemed, just weeks ago it seemed that she was going to move on to Bank Indonesia, but now it seems that might not happen and that, in fact, she might stay on as Minister of Finance. Some people I’ve talked to in the Finance Ministry and in the cabinet in general, they seem to think that some continuity in the Finance Ministry is needed. So its really possible that Sri Mulyani will stay. If she doesn’t, she’ll go on to Bank Indonesia. And then who replaces her at the Finance Ministry, it’s hard to say. The leading candidate is the man, and I can’t remember his name off the top of my head…


Caller 2: Chatib Basri?


Gelling: Yeah, Chatib Basri, yeah that’s one too, that’s another guy, an advisor to Yudhoyono and respected economist and he’s a possibility, but I think a stronger possibility is the man who is in charge of the tax and customs office under Sri Mulyani and who played a large part in cleaning up those offices. But any of these names being floated around would be a good thing. They’re all very positive and they’re all technocrats. None of them are affiliated with any other political parties. And so far, Yudhoyono has given no indication that he is going to be handing out ministerial posts that supported him. Because I don’t think Yudhoyono feels he really got benefited that much from support of other political parties this time around. I mean, this one was his win alone. He could give or take the rest of them. So, we’ll see.


Caller 2: Thank you.


Passport: Do you have another question?


Caller 2: No, that’s it.


Passport: David, do you have another question?


Caller 1: Just a question about productivity and society in Indonesia. It seems so unlikely to an outsider that the country of Indonesia actually works given the fact that it’s so spread out over such a large area. How does the political system and the economic system operate efficiently, or does it, across the entire archipelago?


Gelling: I don’t think it does. There’s been this process of decentralization going on now for the past five years, or the last ten years. You’ve seen some success in that, some empowering of areas far away from Jakarta. It works best the closer you are to Jakarta. The farther you go out, to Papua, say, or East Nusa Tenggara, its much more poor and rural and the infrastructure is terrible. And the closer you get to Jakarta, the infrastructure improves, but that’s slowly changing as the country gets a hold of this decentralization process. The problem is, these outlying areas don’t have the governments, the qualified people yet, to run these decentralized local governments efficiently. So it’s going to be some time before that can actually happen. But its moving in the right direction.


Passport: Do we have any other questions? If we don’t have any questions, I think that’s about the time that we have. Let me just mention that Peter (back to the subject of Sri Mulyani) did an excellent interview a few of weeks ago that is currently on the Passport site with Sri Mulyani. She admits, for example, that bribes are on the table, more of less every day in her job, and makes some other frank comments that you don’t often hear from Ministers from Southeast Asia.


And I also have one final announcement. For next week’s call, we have a preliminary commitment to talk with a GlobalPost correspondent who covered the elections in Iran for us. He was jailed for several weeks before being allowed to leave Tehran. And assuming that his schedule permits, we’ll be talking to him at the same time next week. As usual, I’ll let you know about that by email.


Thanks everybody for joining us today. Thank you, Peter.


Gelling: Thank you.