Indonesia's Richest Man's Home Looted in Riots as Business Empire Collapses

Jakarta, CNBC Indonesia — Indofood is a well-known name familiar to Indonesians as a key pillar of the Salim family’s business conglomerate. Even in its third generation of leadership, the group remains a symbol of business strength in the country.

However, behind its current dominance and reputation, the Salim Group’s history holds a dark chapter. This vast business empire once hit rock bottom and suffered a catastrophic downfall.

The rise and fall of the Salim Group is tied to its founder, Sudono Salim, and his relationship with the authorities of the time. To understand how this business empire grew so large — and then was severely struck — we must revisit the networks Sudono built with the New Order regime.

Sudono Salim was close to Indonesia’s second president, Soeharto. After independence, Sudono operated as a clove importer and military logistics entrepreneur. His extensive business network attracted Colonel Soeharto, who wanted to collaborate with him.

Through his cousin Sulardi, Salim and Soeharto first met. Salim then became a supplier of logistics for Colonel Soeharto’s forces during the Independence War (1945-1949). This introduction changed Salim’s life.

“After Soeharto gained power in Indonesia in the mid-1960s and became president, he was supported by a group of business cronies, the largest and most powerful of whom was Liem Sioe Liong,” wrote Richard Borsuk and Nancy Chng in Liem Sioe Liong and Salim Group (2016).

For three decades, both were involved in a mutually beneficial relationship. Soeharto protected Liem and ensured his business ran smoothly. In return, Liem, through the Salim Group, funneled funds to Soeharto, his family, and other cronies. As a result, both sides prospered in their respective fields.

Salim became Indonesia’s richest man, while Soeharto maintained his grip on power. But their success was abruptly shattered in just a few days in May 1998.

Target of Mob Fury

For three decades, Salim built three business empires across sectors: banking (Bank Central Asia, BCA), construction (Indocement), and food (Bogasari and Indofood). However, these began to crumble during the 1998 crisis, with BCA hit hardest.

Historian M.C. Ricklefs, in A History of Modern Indonesia (2009), noted that during the crisis, depositors withdrew funds en masse. Hundreds queued for hours to drain their savings. This left BCA, now distrusted by the public, on the brink of collapse.

The crisis peaked in May 1998.

Salim’s closeness to Soeharto proved disastrous. Anti-Soeharto sentiment, fueled by the economic crisis escalating into political turmoil, dealt a severe blow to Salim. The public, aware of their ties, targeted him.

As the richest man, Salim had to be destroyed. This occurred after protests turned into racial riots on 13 May 1998.

That day, Jakarta and surrounding areas were engulfed in riots, looting, and arson targeting homes, commercial buildings, and vehicles (Kompas, 14 May 1998).

The actions were carried out by provoked mobs, who targeted properties and vehicles owned by ethnic Chinese, even targeting the Chinese community itself.

Jemma Purdey, in Anti-Chinese Violence in Indonesia 1996-1999 (2013), explained that racial sentiment against Chinese Indonesians arose from stereotypes that they were hated solely for being wealthy and close to the Soeharto regime. Sudono Salim was the central figure associated with this description.

“The companies of the cukong and Soeharto’s relatives were primary targets for arson and looting. Bank Central Asia, owned by Liem Sioe Liong, was a main target,” Ricklefs wrote.

According to Richard Borsuk and Nancy Chng’s account, fortunately, when the riots occurred, Sudono Salim, his wife, and some children were in the United States accompanying him for an eye operation. In Jakarta, only Anthony Salim was working at Wisma Indocement on Jl. Sudirman.

Anthony dared not return to his father’s home in Roxy, as the riots targeted Chinese residential areas. He feared that if he stayed at home, he could be killed.

The prediction proved correct. On the morning of 14 May, Anthony received word that a group of threatening youths armed with fuel cans and tools had arrived at his father’s mansion, intending to enter.

Anthony had no choice but to order security to let the mob enter and damage the house rather than resist and cause bloodshed.

“Within moments, all cars in the garage were set ablaze, along with everything inside the house. They burned furniture, tore down paintings, and ransacked rooms. They even scrawled inappropriate words on the walls,” Anthony told Richard Borsuk and Nancy Chng.

After several minutes of this, thick black smoke quickly rose from Salim’s residence. In the streets, photos of Salim were stoned and burned by angry mobs (Kompas, 15 May 1998).

Seeing Jakarta’s dire situation, Anthony immediately decided to leave his office. Fearing his office would suffer the same fate as his home, he went to Halim Airport to fly to Singapore on a private jet. From there, Anthony monitored his business developments during the tough period.

Business Empire Collapse

After the riots subsided and Soeharto stepped down, BCA suffered the worst losses. A total of 122 branches were damaged, including 17 offices