Is Zhu's China a threat to RI?

Is Zhu's China a threat to RI?

By Budiono Kusumohamidjojo

JAKARTA (JP): The National People's Congress of the People's
Republic of China has just closed its sessions and has drawn a
remarkably strategic resolution.

On March 16, 1998, the national legislature appointed Li Peng
as chairman of the congress. However, more eye-catching is the
legislature's appointment of Zhu Rongji the day after as the
fifth prime minister, for the next five years, of the world's
most populous country.

Zhu has been watched as China's new rising star since the last
decade, when he was still Shanghai's mayor. While President Jiang
Zemin managed to perform tremendous international breakthroughs
in favor of China, Zhu Rongji made great strides by further
strengthening China's economic development.

Now, having won an absolute majority backed-up mandate from
2,890 out of the 2,950 parliamentarians at the congress, he vowed
to keep China's economy growing at a pace of 8 percent and to
lock inflation at 3 percent.

The man who is notorious for being short tempered and blunt in
his expressions will put state enterprises on a stern diet. In
most countries, state enterprises are reputed for their
consistently poor performance and for burdening the state budget
with loss-making instead of profit.

The People's (central) Bank of China, of which Zhu Rongji was
a former governor, will be given a new role by supervising the
merchant banks as part of his scheme of boosting China into the
next century.

The step seems to be indispensable since the coming decades
will be marked by striking global competition. The People's
Liberation Army, being one of the biggest armed forces in the
world, will be trimmed in terms of personnel as well, in order to
enable it to support the country to liberate itself from
backwardness rather than fighting "paper tigers" as they used to
do in the past. China's scientific elite has started mentioning
its plan to land a Chinese astronaut on the moon.

What is the relevance of all this to Indonesia?

We are being stuck by our own vast domestic problems, which
range from scarcity of daily basic necessities and medicines to
grave doubts in the country's institutions.

We are tensely watching the Army trying to keep peace with our
own people. We are suffering an economic stagnation and a wave of
destruction of capital goods, while mass violence among our own
people tends to become the rule of the day.

We are stiffly buried in a national quandary of our own
creation. As a result, we tend to fail to watch developments in
other parts of the world, that of China in particular.

However, failing to keep a reasonable watch on China's
development will lead us to a mistake that we can only regret
later and forever.

The late reform patriarch Deng Xiaoping has left behind a
pragmatic and dynamic system as his invaluable legacy. When he
passed away last year, the system had already started to
demonstrate the goal he was aiming at.

On March 18, 1998, the daily Kompas visualized a comparative
projection between China and Japan. Japan was portrayed as a
country clearly on a down slope due to its vast and stagnating
bureaucratic system, corruption and problems related to a
stacking economy.

Having been lagging behind Japan for decades, particularly in
economic terms, China is now taking a different course, which is
an impressive one indeed. There is no doubt that Zhu's economic
policy will have some bitter effects, which, among others, will
include the more than 11 million state-enterprise workers to be
laid off. Nevertheless, even the affluent societies of the West
are chronically suffering from unemployment problems anyway.

It is beyond doubt that China will be posing Japan with a
massive challenge within the next five years. Given that the
Zhongnanhai, the Chinese central government circle in Beijing
that used to be ruled by a gerontology, we may even expect that
the economic czar Zhu, now 69, will direct the current course of
the country for another decade.

If Japan will have its hands full with its great neighbor,
what about Indonesia?

Although Indonesia is not directly exposed as a proximate
neighbor to China, as is the case with Japan, global economy and
telecommunications will not place Indonesia in a better protected
position either.

Distance is an irrelevant issue in a world that is becoming
more and more knitted into an interdependent market. The
sociopolitical and the monetary-economic crisis now plaguing
Indonesia is placing the country in a more difficult position to
anticipate and to adequately respond to any additional external
challenges.

The crash of the Indonesian rupiah is making countries as
faraway as the U.S. and Germany nervous about the possibility of
a new Asian political crisis. Such nervousness is well understood
since a crisis plaguing a country that is as big and as strategic
as Indonesia would result in a domino effect and destabilize the
global market.

Still, Indonesia would belong to those who suffer most in such
a troubled market. In such a position, it would be most difficult
as well for the country to cope with the challenge resulting from
the reform leaps taken by Zhu, who is renowned for his efficient
pragmatism.

Having been disgraced for two decades under the Mao-era, and
purged as a rightist, he seems to know no taboos even within the
frame of a socialistic reform. While Beijing shocked the world
community with the students' massacre backed by Li Peng in June
1989, Zhu managed to convince the students to go home and keep
Shanghai peaceful.

The challenge Indonesia will have to face as a result of Zhu's
election as the new Chinese prime minister is manifold, despite
the high probability that it will grasp more the economic sector
of international relations rather than directly the military and
security sector.

To date, China has everything it needs to become a new
superpower. It was Deng Xiaoping who had made it understood quite
clearly by the Chinese ruling class that it needs to have a
strong economy in order to be a real world power.

Sometime in the near future, Indonesia will have to deal with
China as a new superpower rather than merely having a headache
about how to compete in the global market. Zhu, with his team,
consisting of Dai Xianglong, 54, the new governor of the People's
Bank of China, Xiang Huaicheng, 59, the new finance minister, and
Tang Jiaxuan, 60, the new foreign minister, will strive to
strengthen China's competitiveness.

Moreover, Deng Xiaoping seemed to have not only nurtured a
group of reliable cadres for the country's leadership, but he
also secured a mechanism for a well-controlled succession. After
Jiang Zemin proved his capacity without the presence of Deng
Xiaoping, now, Zhu obviously will do his utmost to merge Chinese
socialism with the global market system.

That is exactly what Deng Xiaoping meant with his doctrine of
one state with two systems, regardless of whether they are
compatible or contradictory, which truly reflects a pragmatism
that gives no room for ideological taboos.

Prof. Anwar Nasution from the University of Indonesia
regretted that Indonesia has lost at least four months by
hesitating with measures to reform our economy.

Nasution does not seem to be alone with his views. It is
beyond doubt that many Indonesian intellectuals and professionals
share his conviction that we have to come back to logical
reasoning and set aside any kind of covert vested interest.

The promulgation of a decree on Saturday, March 21, 1998, by
the finance minister to subject foreign currency purchases to a 5
percent tax, and its revocation on Monday, March 23, 1998, the
day which it was supposed to come into effect, demonstrates our
ill preparedness to cope with our own domestic problems, let
alone to deal with a challenge to compete against a country that
is on its way to becoming a superpower not just in Asian regional
terms, but also in the global context.

It is ridiculous that we look for support from Japan in our
efforts to overcome our difficulties, while Japan has its own
domestic headache and will now have to think about new terms as
to how it may reach a sustainable modus vivendi with China.

Just like Deng Xiaoping did two decade ago, we need to regain
our own cool head and consider what reasonable pragmatic steps we
have to take.

Indonesia has an abundant workforce and is rich in natural
resources. What we are missing seems to be a clear mind and a
strong will to come to concerted efforts fully in the interest of
the nation.

The writer is a legal consultant and lecturer in legal
philosophy based in Jakarta.

Window: The challenge Indonesia will have to face as a result of
Zhu's election as the new Chinese prime minister is manifold,
despite the high probability that it will grasp more the economic
sector of international relations rather than directly the
military and security sector.