National assets to pay debts?

National assets to pay debts?

JAKARTA (JP): Bank Indonesia, the central bank, has announced
that the country's total foreign debt amounted to US$118 billion
as of September last year. The government was responding to media
speculation about the actual size of the debt, alleged to be
about $200 billion.

But this official figure does not include the standby loan
from the International Monetary Fund, amounting up to $40
billion.

Let us assume the government would not make use of the IMF's
standby loan -- and thus no interest would be paid -- in order to
create a scenario in which the amount of the foreign debt would
not move from the officially stated figure. Also, let us operate
under the assumption that Indonesia's total population would not
increase drastically. After all family planning programs have
substantially reduced population growth.

How much would each Indonesian owe?

The total population is now just over 200 million, including
the elderly and newborns. This means that, like it or not, every
Indonesian's share of the foreign debt of $118 billion is $590.
This, of course, is the lowest and most optimistic figure.

The most pessimistic would add the IMF's standby loan to the
$118 billion, making a total of about $170 billion. This
calculation would mean $850 in debt for each and every citizen.

Before the economic crash, estimates put per capita income at
about $1,500. With the plunge in the rupiah, causing a
devaluation of around 119 percent, this figure is now probably
around $800.

Which leads us to a surprising conclusion: per capita income
is now probably almost equal to per capita foreign debt. In a
deteriorating economy in which many business conglomerates cannot
pay their debts in their entirety, this is a gloomy statistic
indeed.

How could we possibly pay our debts?

Here's an idea. Maybe Brunei Darussalam, the richest country
in the world, is interested in buying Kalimantan.

The people in Kalimantan could then choose to be new citizens
under their new master, or remain Indonesians. The second choice
would be to make them to move to other islands. If they preferred
to maintain their Indonesian citizenship but chose to stay in
Kalimantan, they would need to have passports.

But there is reasonable doubt that, after last year's
catastrophic forest fires, Kalimantan's natural wealth is still
intact and whether its value would be equivalent to the foreign
debt amount. The incredible estimates about gold at Busang have
proved to be nothing but lies. Its once bountiful logging
enterprise has long been on the wane since forests are now as
rare as comets.

But perhaps Brunei would be interested in making Kalimantan
into the largest golf course in the world. They won't need to
clear the forests, and Kalimantan's flat landscape offers an
ideal area for a huge golf course.

If selling Kalimantan is not sufficient to pay all the debts,
we can think about selling Sumatra to Singapore, with similar
conditions as for Kalimantan. But the problems would be more
complex here since the population is greater than in Kalimantan.
Sumatra's rugged landscape and natural conditions would also make
it more difficult to design the island as a golf course.

A proponent of the rational choice theory would hastily agree
that the options of selling Kalimantan and Sumatra were indeed
good suggestions. But I don't want to insult my compatriots
living on those islands by putting their lands up for sale. What
if they had a similar idea of selling Java, my island of origin?

But if we can't pay the debts and we can't sell one of our
islands, then what? Maybe the only one other option is "go to
hell with our debts!" Or what other suggestions are there to
extricate us from this problem?

-- Hermawan Sulistyo