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Corruption scandal: a police-hatched hoax

The case against two anti-corruption officials is dropped after a recording shows that police framed them. The scandal distracts the president. Indonesia's poor environmental record makes news again in the run-up to Copenhagen. West Papuans celebrate their elusive independence day with 13 arrests. Parliament organizes an inquiry into Finance Minister Mulyani's bailout of Bank Century. With China's help, magnate Aburizal Bakrie bounces back after the economic collapse. And a documentary about the murder of Australian journalists in Timor is banned, then screened to hundreds by journalists.

Top News: After months of controversy, mass demonstrations, legal battles and speculation about the future of the country, two embattled corruption fighters accused of graft are going back to work. Indonesia’s constitutional court ordered the case dropped, calling it a total fabrication.


The two men, deputy commissioners at the hallowed Corruption Eradication Commission, or KPK, had been arrested by police on charges of taking bribes and abuse of power on Oct. 28. A week later, a wiretap recording played in court and aired publically revealed a complex plan devised by a senior police official, a deputy attorney general and a fugitive businessman to frame the deputies.


Still, it took several weeks of protests and the intervention of the president before the two men were absolved of any wrongdoing.


The controversy has derailed President Susilo Bambang Yudhoyono’s agenda for his second term, which began in early October and called into question his administration’s progress in eradicating corruption – one of its primary election promises. The scandal, coupled with public anger over a controversial bailout of a major bank, appears to have knocked the president off his stride. He is now publically insinuating that “rogue elements” are using the scandals to try to topple him. In a public speech he said a planned demonstration on Dec. 9, World Anti-Corruption Day, was a sham concocted by rival political players.


Meanwhile, focus has again turned to Indonesia’s environmental record as the U.N.'s conference on climate change gets underway in Copenhagen. Indonesian forests continue to be cut and plowed at record speeds to make way for palm oil plantations, a process that environmentalists say is contributing significantly to global greenhouse gas levels.


The Indonesian government, however, has rejected the oft-used tag that Indonesia is the world’s third-largest emitter of greenhouse gases behind the United States and China. It was a 2007 World Bank report that created the label, blaming the rampant cutting of its forests, persistent wildfires and cultivation of carbon-rich peat bogs.


West Papuans celebrated their elusive independence day on Dec. 1, resulting in the arrest of at least 13 Papuan demonstrators who were all charged with raising the banned Morning Star flag, a symbol of Papuan independence. Dec. 1 marked 48 years since the Free Papua Movement declared their independence from the Dutch colonial administration. 


News reports said the 13 protesters were later released, but that scores more remain in prison for displaying the flag, a crime that can carry a punishment of life in prison. News out of the province is often hard to come by, as the Indonesian government has banned all foreign journalists from traveling to the province.


Money: With the KPK scandal now apparently over, attention has again turned to the government’s controversial bailout of Bank Century. The public and a coterie of lawmakers have been questioning the decision by Finance Minister Sri Mulyani and Vice President Boediono to inject more than $700 million into the flailing Bank Century at the height of the global economic collapse. 


Parliament has now scrambled together a highly-politicized inquiry into the bailout and some are calling for the resignation of Mulyani, one of the country’s most respected technocrats, famous for her cutthroat attention to clean governance.


Now, in an effort to fight back, several high-profile corruption fighters are putting together a public relations machine to help clear Mulyani’s name and prevent any further tumult.


Aburizal Bakrie, the former minister for people’s welfare, the current Golkar chief and one of the country’s richest men, has managed to bounce back (again) from near ruin following the stock market collapse last year that nearly wiped out his heavily indebted conglomerate.


Bumi, Bakrie’s coal mining company, has been helped along by an almost $2 billion investment from China. Now, the well-connected businessman is aiming to purchase a bevy of high-profile mining companies, including a percentage of the American-owned Newmont, which under Indonesian law is required to divest 51 percent of its shares to Indonesian companies.


Bakrie companies also nearly collapsed after the Asian Financial Crisis in the late 1990s, but pulled through primarily due to his close relationship with then-president Suharto.


Mulyani, for her part, threatened to resign last year after Yudhoyono asked her to help bailout Bakrie. Yudhoyono, apparently valuing Mulyani over the businessman, who helped finance his first run for president, in the end stood by the stalwart finance minister.


Elsewhere: An Australian documentary film, “Balibo,” about the deaths of five Australian journalists in the 1970s during an Indonesian military rampage in East Timor following the small country’s declaration of independence, has been banned by the Indonesian government. Dozens of foreign journalists sat in a movie theater waiting for the screening when the president of the Foreign Correspondents Club sheepishly came to the stage and announced that minutes ago he had been informed of the ban.


Indonesian journalists were not so quick to lie down. A local journalist organization successfully screened the film in front of hundreds.


Indonesia has always claimed the journalists, known as the Balibo Five, were killed in cross-fire. But evidence suggests they were murdered to cover up the Indonesian invasion. A soldier who was there at the time came forward this week to admit the scribes were purposely killed, adding that their bodies were burned afterwards to hide the evidence. Neither the Indonesian nor the Australian government has responded to the new report.