Collusion dictates to economy: Scholar
Collusion dictates to economy: Scholar
SURAKARTA, Central Java (JP): Collusion between powerful conglomerates and the administration is so dominant that it dictates the direction of the Indonesian economy, an economist from Gadjah Mada University said yesterday.
"Conglomerates and bureaucrats are the two dominant groups that determine the fate of our economy," Revriand Baswir said in a seminar on the national economy held by Sebelas Maret University on Friday.
The seminar also featured Sritua Arief, an economist from the Salatiga-based Satya Wacana Christian University.
Baswir, who is the director of the Yogyakarta-based Institute of Development and Economic Analysis (IDEA), said conglomerates and bureaucrats play important roles in determining the production of goods in Indonesia.
"They are also the ones who reap the fruits of national development," he added.
At the same time the businesses of conglomerates and bureaucrats are difficult to control, he said.
He noted that 58 percent of Indonesia's Gross Domestic Product is controlled by about 200 large conglomerates, 24 percent by 182 state-owned enterprises, another 10 percent by middle-scale businesses, and the remaining eight percent by 36 million small- scale businesses and cooperatives.
Strong
Baswir said that collusion has made it difficult to differentiate between conglomerates and bureaucrats.
"The interests of conglomerates and bureaucrats have become similar. We end up with `Bureaucratic conglomerates' and `conglomerated bureaucrats'. They are very strong and often cannot be distinguished," he said.
To change the situation, Baswir proposed the development of an "economy by and for the people".
Baswir said the concept would be consistent with the goals of prosperity for the people as stipulated in the 1945 Constitution.
An economy by and for the people would require everyone to pay attention to the economic condition of the common people, he added.
Sritua Arief highlighted in his paper the fate of millions of Indonesian farmers, whom he said have grown more impoverished as they have integrated with the modern economy.
Sritua said many farmers have become heavily indebted under the modern economic system. They not only lost possession of their land, but also ownership of the produce that they helped plant.
"They have become mere planters," he said.
He noticed that farmers no longer have direct access to customers, either local or abroad, and their fate is controlled by middlemen who set the prices of their crops.
This impoverishment push farmers towards even greater indebtedness, Sritua said. "No wonder they're becoming poorer and poorer by the day."(har/imn)