Mega hopes palm oil eases arms buying trip<\/p>\n
Kornelius Purba, Staff Writer, The Jakarta Post, Jakarta,
\nkorpur@yahoo.com<\/p>\n
This Easter, President Megawati Soekarnoputri is scheduled to
\nmeet Russian President Vladimir Putin. Hopefully, there will not
\nbe any misunderstanding should either wear surgical masks, given
\nthe fear of Severe Acute Respiratory Syndrome (SARS), the effect
\nof which is also felt in Indonesia.<\/p>\n
The problem of SARS, however, does not mean Megawati's
\npresence is unwelcome in Russia.<\/p>\n
Megawati may raise the question of purchasing Russian weapons,
\nincluding the Sukhoi Su-30 KI, given that Indonesia reportedly is
\ninterested in procuring at least one squadron of jet fighters.<\/p>\n
With the buying power of natural rubber and palm oil in her
\nhands, the President will leave Jakarta on Thursday for an arms
\nshopping mission to cash-starved countries in eastern Europe.<\/p>\n
\"This is serious business, not a picnic or a waste of money,\"
\nshe said, most likely in anticipation of the recurring criticism
\nabout her overseas trips.<\/p>\n
The visit to Russia is a part of the President's 12-day tour
\nto Poland, Rumania, Russia and Thailand. Arms shopping will
\nostensibly be a major item on the President's agenda during her
\nfour-day stay in the former Eastern European nations.<\/p>\n
This will be the second window-shopping trip for the President
\nto the region following her visit to Hungary, Croatia and Bosnia
\nHerzegovina last September.<\/p>\n
Indonesian ministers and military top brass have often
\nconveyed their enthusiasm for buying jet fighters and weapons
\nfrom the former members of the Warsaw Pact, because of the
\nprolonged U.S. arms embargo on Indonesia.<\/p>\n
The military has suffered severely from the embargo,
\nespecially the Air Force. In an apparent attempt to upset the
\nU.S., they have desperately pointed out the benefits of
\npurchasing jet fighters from countries other than the U.S.<\/p>\n
The government wants to send Washington the message that
\nIndonesia can easily procure its military equipment elsewhere.<\/p>\n
This an old tactic that former president Soeharto often used.
\nIn retaliation against the U.S.' decision to link their sales of
\nnine F-16 fighters with human rights abuses in Indonesia,
\nSoeharto canceled the planned deal at the onset of the economic
\ncrisis in 1997, and disclosed his plan to buy Russian jets and
\nFrench Mirage 2000 fighters.<\/p>\n
Soeharto then announced that he would instead buy 12 SU-30K
\nfighters and eight MI-17-IV helicopters from Russia, although the
\nU.S. offered cheaper prices and better after-sales services. The
\naircraft and choppers were scheduled to be delivered in 2000.<\/p>\n
Russia agreed to a countertrade deal because it could not
\noffer export credit facilities or off-set deals like the U.S.
\nIndonesia would purchase the sophisticated aircraft with 40
\nproducts, including palm oil, toys, rattan and stationery. The
\nsolution was typical of Soeharto -- his youngest daughter Siti
\nHutami Endang Adiningsih would profit from the sales.<\/p>\n
Engaging in countertrade deals in the aviation industry is not
\nnew to Indonesia. Thailand once paid for aircraft it bought from
\nIndonesia -- produced by the now nearly bankrupt PT IPTN -- with
\nsticky rice.<\/p>\n
As the economic crisis worsened, Indonesia had to cancel the
\nbusiness deal with Russia, just a few months after Soeharto
\nconfidently announced his plan and while his daughter was busy
\ncalculating her would-be profit from the business deal.<\/p>\n
Now, Megawati is following the same strategy. Last year, for
\nexample, Megawati offered palm oil and natural rubber to Croatian
\nPresident Stjepan Mesic to buy Croatian arms during her visit to
\nthe country.<\/p>\n
Indonesian Military (TNI) top brass are very keen on the plan
\nto purchase arms from the eastern European countries, and have
\npraised the quality of their military equipment. Unlike the U.S.,
\narms transactions are pure business for countries like Russia.
\nThey are not interested in linking business deals with human
\nrights issues.<\/p>\n
But will the U.S. react as Megawati may expect? Washington has
\ncontinued the arms embargo, including the supply of spare parts
\n-- especially after Indonesia \"lost\" East Timor in 1999 --
\ndespite U.S. officials' promises to lift the blockade.
\nIndonesia's domestic condition, especially its economy, and the
\nglobal situation is not conducive to Megawati's arms buying
\nstrategy.<\/p>\n
Indonesia does not have fresh money, and the letters of credit
\nissued by Indonesian banks are often rejected by foreign
\ncompanies. Indonesia can buy weapons from any country in the
\nworld if she has cash, or if foreign arms producers regard
\nIndonesia as too lucrative to be ignored -- even if they have to
\naccept palm oil as payment.<\/p>\n
So when Megawati and Putin witness the signing of the
\nMemorandum of Understanding on the arms and aircraft purchases
\nmade by their respective ministers on Sunday, the signing
\nceremony will likely produce a virtually blank document, because
\nRussia and other countries in the region need U.S. greenbacks
\nmore than palm oil or rubber. The negotiations will be very
\ntiring, if not fruitless.<\/p>\n
U.S. officials would smirk jeeringly at the Megawati
\nadministration when she fails to persuade Putin to accept her
\npalm oil products.<\/p>\n
Indonesia's palm oil plantations are often exploited by local
\npeople. How could Russia -- or any other country, for that matter
\n-- be convinced that they would benefit from a countertrade
\ntransaction?<\/p>\n
If Thailand only needs sticky rice to pay for Indonesia's jet-
\npropelled planes, the President may be thinking, there's no
\nreason why Indonesia can't apply the same standard to other
\ncountries.<\/p>\n
Traveling to Russia with palm oil in hand, will she return
\nwith jet fighters in her shopping bag?<\/p>",
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