Law needed to protect minority interests

The mass rioting in Jakarta and other cities in the middle of May badly affected many businesses owned by Chinese Indonesians. Director of the Indonesian Business Data Center, Christianto Wibisono,proposes measures to revive their businesses.

Question: How much do you estimate the direct losses incurred by the arson, destruction and looting in the recent rioting?

Christianto: The direct losses might have been as high as Rp 10 trillion (US$909 million) since thousands of houses, shops and other buildings were burned, destroyed and looted. In my daughters' housing complex in West Jakarta alone, where about 60 houses were set ablaze, the losses might have totaled Rp 6 billion. We have yet to calculate the indirect losses, which includes the halt in the operation of shops. The cessation of their operations also means the obstruction of distribution for industrial activities.

Even though the targets of the rioting were generally the assets of the ethnic Chinese, why did some Chinese Indonesians also take part in the looting?

The Chinese Indonesian looters were those living in slum areas. That indicates that the rioting was also partly caused by the widening gap between the rich and poor, besides racial prejudices between indigenous and nonindigenous people.

Did the rioting cause capital flight?

Yes. But the amount of funds sent abroad by the ethnic Chinese after the rioting was not much because most of them, as well as corrupt government officials, had already put their money, estimated to reach tens of billions of dollars, overseas not long after the start of the monetary crisis last July.

How long will it be before ethnic Chinese businesspeople restart their businesses?

I think it will not be too difficult for them to revive their business facilities and generate new capital. The most difficult thing for them now is how to cope with their trauma. My traumatized daughter, for instance, will never return to her home. They need a feeling of safety to resume business activity. The funds which are now being saved overseas will never return either, unless security is guaranteed.

President B.J. Habibie has promised that he would no longer tolerate discrimination based on differences of race, religion or groups. Is such a presidential promise adequate?

Such a promise has been issued several times by the government but when seemingly organized criminals incited the mid-May rioting, no security forces were available to stop their arson, looting and vandalizing.

So, I think we need a law to protect the interests of minorities. Furthermore, more than 20 existing regulations, which are discriminative in nature, must be revoked or revised. The regulations include the one on civil registration, which has encouraged local administration officials to offer "better services" in return for illegal levies.

Is it possible for indigenous Indonesians to develop the country's economy with a high growth rate without the participation of ethnic Chinese businesses?

It would be difficult because the ethnic Chinese contribute about two-thirds to the country's economy. Chinese Indonesians contribute little to business sectors dominated by state-owned companies but play a major role in other sectors.

In train transportation and business ventures for fuels, asphalt, fertilizer, dynamite and methanol, for example, they play no role. The government is the main manager of these sectors. But the ethnic Chinese dominate in bus transportation, banking, construction, coffee plantations, forestry and the production of alcohol, textiles, pulp, paper, electronic products, jewelry and cigarettes.

The ethnic Chinese also strongly dominate in the distribution of goods. That's why as soon as their shops were burned, the distribution network in the country almost collapsed. The government is now trying to encourage cooperatives to play a bigger role in the distribution of goods but are they ready for the job? The State Logistics Agency (Bulog) has actually prioritized companies owned by indigenous Indonesians to distribute its goods, such as sugar, but those companies, in turn, assign nonindigenous Indonesians to carry out their jobs on a fee basis.

Is it true that ethnic Chinese conglomerates have developed through collusive practices with government officials?

Only a few of them have developed through collusive practices but because their businesses are big, the amount of funds involved were big too.

What do you think is the best way to narrow the gap between the rich, which are mostly ethnic Chinese, and the poor, which are mostly indigenous Indonesians, to reduce social jealousy?

I wouldn't mind the introduction of an affirmative action law with the aim of, say, providing privileges to indigenous people. Such an affirmative action program, in spite of its discriminatory principle, would be positive because it would offer assistance to the weak. But such a policy should not allow any resistance to the growth of the strong or drive indigenous Indonesians to become lazy, by selling their job accreditations to other parties.

The collection of funds equal to 2 percent of companies' net profits -- if the profits exceeded Rp 100 million a year -- under a presidential decree issued by former president Soeharto was a bad example of helping the weak by taking from the strong. Furthermore, such fund collections created discipline problems in state-budgeting and their accountability was doubtful. (riz)