The myth about the Chinese-Indonesians<\/p>\n
Some say many goods have become scarce or expensive because
\ntheir distributors, mostly traders of Chinese descent, have fled
\nthe country. Economist Kwik Kian Gie says this is a myth created
\nto discredit Chinese-Indonesians.<\/p>\n
JAKARTA (JP): Recent media reports have prompted me to
\nquestion their accuracy. They claim that goods are becoming hard
\nto find and expensive after their distribution was crippled
\nbecause traders of Chinese descent fled abroad. Since Chinese-
\nIndonesians control 70 percent of the economy, trade is crippled,
\nthe reports say.<\/p>\n
Is this true? Too many claims and figures have been bandied
\nabout without support of even the most basic research. We do not
\nneed detailed research, but we could ask ourselves and use our
\nown observations to answer this question.<\/p>\n
We have to treat the \"theory\" carefully. It is not impossible
\nthat the May riots in Jakarta and Solo were politicized to
\ndiscredit particular parties.<\/p>\n
It's true that many shops were closed for a few days after the
\nMay 14 riots and that some shops were emptied by looters. Reports
\nof rapes, torture and killing made Chinese-Indonesians angry,
\nanxious and insecure. Many of them did indeed flee the country.
\nBut how many? One estimate puts the number at 100,000. Even if
\nthis figure is accurate, is it enough to cripple the economy?<\/p>\n
We should analyze this with a cool head.<\/p>\n
According to television reports, many Chinese-Indonesians who
\nfled abroad returned to Jakarta a few days after the May 14
\nriots. By then, Jakarta was safe. We saw tanks and armored cars
\nand combat-ready soldiers everywhere.<\/p>\n
Has the destruction of shops and offices disrupted the flow of
\ngoods and services? Of course it has. Several shops where we
\nregularly bought our goods have been razed. But there are many
\nother shops in Jakarta still intact. Clearly the reports that the
\ndistribution network was crippled because about 100,000 Chinese
\nIndonesians fled abroad is an exaggeration.<\/p>\n
The fact that prices soared shocked me, and everybody
\ncomplains about this development. But this was not caused by the
\npoor distribution network. The distribution infrastructure may
\nhave been damaged, but not to the extent of disrupting the flow
\nof goods. If the distribution network has been badly damaged,
\nthen goods must be piling up in some warehouses. This is not the
\ncase.<\/p>\n
If we have a shortage, it is more because of scarcity in
\nsupply. Why? Because we import many of our basic needs. With the
\nrupiah plunging to Rp 15,000 per dollar, people could not afford
\nthem anymore. As sales decline, traders stop importing them,
\nwhich is how scarcity develops.<\/p>\n
The core of the problem is the overall economic condition. It
\nis not because 100,000 Chinese Indonesians have fled, taking
\ntheir wealth with them. Those who are suggesting this are
\ncreating an image that Chinese-Indonesians lack patriotism. They
\nalso suggest that the Indonesian economy is vulnerable so long as
\nChinese-Indonesians control the economy because they keep fleeing
\nthe country every now and then. This is a grossly misleading
\npicture, and is an attempt to cover the weaknesses in the
\nfundamentals of our economy.<\/p>\n
I know of some people who have gone abroad. But they have been
\ntraveling all the time. Some of them may have decided to stay
\nabroad because they feel safer. But practically everyone that I
\nknow who left has now returned to Indonesia.<\/p>\n
The core problem is that the economy was built on the basis of
\ncorruption, collusion and nepotism (KKN). Through KKN, they
\nreaped funds from the Jakarta Stock Exchange, from domestic and
\nforeign banks. Since this was ill-gotten wealth, they keep part
\nof it abroad.<\/p>\n
Who are these people? By definition, KKN involves a
\ncooperation between entrepreneurs and the rulers. Since the
\nrulers are the pribumi (indigenous), it would have been
\nimpossible for any Chinese descendant to engage in KKN without
\nthe participation of the pribumi. The profit that the latter has
\nreaped is as big as that reaped by their partners of Chinese
\ndescent. But the pribumi do not own companies, so they do not pay
\ntaxes. Their wealth is invisible because they do not own
\nfactories. They stashed their wealth in foreign bank accounts,
\nthe secrecy of which is guaranteed. They have no obligation to
\nemployees or workers and they have no overhead to worry about.<\/p>\n
I am not trying to defend the handful of Chinese-Indonesian
\nconglomerates who are equally evil. In past articles, I have
\nexposed their dirty practices and condemned them.<\/p>\n
But I can categorically state that the majority of Chinese-
\nIndonesians, who number in the millions, are hard working people
\nwith work ethics, who love the country and did not flee in May.
\nThey would not feel at home abroad even if they had the money to
\nmove.<\/p>\n
Some parties are creating the myth that Chinese descendants do
\nnot love this country, are unpatriotic and that they have all
\nfled. They argue that the role of Chinese-Indonesians in the
\ndistribution network should be replaced by pribumi entrepreneurs.<\/p>\n
While I do not mean to belittle the impact of the May unrest,
\nbut I feel we should put the matter in its true perspective.<\/p>",
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