Empowering the indigenous population

By Junus Jahja

JAKARTA (JP): The economic gulf between the indigenous population and citizens of Chinese descent has become a chronic problem, necessitating a new approach for its permanent solution.

In this context, an article by Indonesia's first vice president, Mohammad Hatta, titled Nationals of Chinese Descent in the Jan. 26, 1957, edition of the Star Weekly may be useful for further thought.

He wrote: "When the Indonesians regained sovereignty, part of the Chinese population became Indonesian citizens and part chose to be Chinese nationals. However, from the point of view of the community, it is hardly distinguishable who is on our side and who is not. What is being noticed is that the economy of the Chinese is stronger than ever.

"This problem could be overcome by a strong economic policy aiming at uplifting the people's weak economy to the level of the already advanced economic group. This problem could not be solved based on capitalistic principles."

The same idea was adhered to by Thee Kian Wie, a well-known economist and research fellow of the Indonesian Institute of Sciences (LIPI).

In his article on Nonindigenous Indonesians and Economic Nationalism in April 1997, Thee stressed that economic gaps or imbalances were the main obstacles affecting the good relationship between indigenous Indonesians and ethnic Chinese in the country. Other factors such as culture and religion also play a role but are not that important.

According to Thee, in countries just freed from their colonial masters, relations between the native population and citizens of foreign descent will improve when national productive assets are in the hands of and controlled by the indigenous people. This was not the case in independent Indonesia. The 1949 Round Table Conference in The Hague guaranteed the so-called historic rights of Dutch businesses in Indonesia. In the economic field, foreigners were still dominant even after 1958, when the Dutch businesses were nationalized.

The feeling of not being 100-percent free in the economic domain still prevailed. Economic nationalism among the Indonesian people at large was still lacking due to the absence of a strong class of indigenous Indonesian entrepreneurs. Positions in the economic sector were then replaced by ethnic Chinese. The economy and the retail sector, especially in urban areas, were in the hands of the latter group, still considered as "aliens".

In the early 1950s, the new Indonesian government introduced the so-called "Benteng Program" to foster the creation of a strong indigenous middle class of businessmen.

However, the program only produced rent-seekers selling the obtained trade facilities to Chinese businessmen. The program was revoked in 1957.

The nationalization of big Dutch companies in 1958 opened even greater opportunities for ethnic Chinese to enter the economic domain left by the Dutch. And the economic policy of the New Order government under Soeharto gave the above population group much greater impetus to enter lucrative sectors.

They developed rapidly and quite a number of them have become very prosperous indeed. They control a large number of productive assets in this country.

This achievement is due to various factors and the emergence of big tycoons among them is, however, not only due to their positive qualities, but also due to "monkey business" euphemistically lumped as "smart political connections" -- corruption, collusion and nepotism. Indeed, there are also a number of Indonesian businesspeople clambering up to the highest level, but the number is relatively small.

Retired lieutenant general Sayidiman Suryohadiprodjo stated in his 1971 book Steps in Our Struggle that a strong "national body" was required to realize "economic nationalism". The existing weakness was that among the indigenous people there were hardly any competent entrepreneurs. Consequently, in view of nation building, the weakness should be overcome in two ways.

First, a strong group of national entrepreneurs should be created at all levels. Second, as many ethnic Chinese living here as possible should become citizens and have the same national consciousness as indigenous Indonesians. Like what Sayidiman said, the indigenous as well as nonindigenous should work together to make the former grow stronger.

But the solution to the "Chinese problem" is indeed not very easy. Besides a policy to abolish poverty in general, other economic measures should be considered, such as the introduction of so-called "affirmative action policies" to promote the growth of a strong indigenous entrepreneurship.

Affirmative action is a special effort to strengthen the economically weak without impairing the economically advanced groups.

Such polices are applied in the United States to promote the economic growth of Afro-Americans and in Malaysia for the bumpiputera, or indigenous Malays.

In this respect, Indonesia's big, medium and small business groups together with prominent figures and intellectuals should form a "consultative body" to diminish economic imbalances in the society. The body should consist of representatives from the government as well as indigenous and nonindigenous groups.

It would be highly effective if the proposed body, with a strong commitment to making the indigenous groups economically dominant and strong, was directly responsible to the president. Thus, the economic nationalism should be attainable and the majority will, at last, feel they are "masters in their own home".

The writer is an activist on Chinese Indonesians assimilation movement.