RI faces democratization challenge

RI faces democratization challenge

By Juwono Sudarsono

JAKARTA (JP): In the East Asian Miracle survey of economic
growth and public policy 1965-1990, the World Bank attributed the
success of eight High Performing Asian Economies (HPAEs) to
getting the fundamentals right: stable macro-economic policy,
high human capital investment, effective financial system,
limiting price distortions, openness to foreign technology and
sound agricultural policies. Overall economic performance was
impressive: rapid growth of exports, transformation of
agriculture, controlled population growth and rapid
industrialization. Poverty was reduced and social indicators
improved.

The World Bank left unsaid two other fundamentals that
helped propel the HPAEs throughout 1965-1990: geographical
proximity to Japan and the authoritarian style of government
intervention. Japan was the powerhouse that pulled the seven
other HPAEs (South Korea, Taiwan, Hong Kong, Singapore, Thailand,
Malaysia, Indonesia) at the fortuitous period: the 1965-75
Vietnam war, which in no small measure helped fuel economic
growth throughout the region.

All eight economies had basically one-party states (the LDP
in Japan was for all practical purposes even more dominant than
Indonesia's ruling Golkar; Hong Kong was and remains until 1997 a
colony; South Korea, Taiwan and Singapore throughout the 1970s
and 1980s in no way reflected liberal democratic forms of
governance. The lesson seems patently clear: there is no
correlation and even less causality between political democracy
and economic growth.

The question for the next 10 to 15 years is: how and to what
degree will there be liberalization in the area of politics to
sustain the projected average 5.5 percent annual growth rate in
the Asia-Pacific region?

By and large, Indonesians are not overawed by the so-called
"democratization" wave which reputedly began in Latin America in
the 1980s and "swept" across Africa and Asia through the early
1990s. A careful examination of how most Latin American and
African nations have fared since adopting "civilian politics" and
"free elections" over the past 10-15 years shows that the vast
majority of the poor have not done well economically.
Maldistribution of income, abject poverty and civil unrest
continue to prevail among the urban and rural poor.

Even allowing for the fact that inflation remains under
control in Brazil and Argentina, for example, the benefits have
largely been confined to the middle class in the cities. Chile's
"Pinochet option" of maintaining tight political control as a
precondition to economic growth is another version of the South
Korea experience of the same period: Roh Tae Woo's transitional
government to Kim Young Sam's contemporary "democracy".

The ASEAN situation reveals some striking differences. At
one end of the spectrum is Singapore's current debate on
political liberalization in a prosperous economic environment.
The Philippines' relative progress on both the economic and
political fronts has recently been touted as a viable alternative
to the disciplinarian model of Lee Kuan Yew. But the Philippines
went through its "pinochet option" during the latter years of
Ferdinand Marcos's rule as president, when not a few of the
current establishment in Manila benefited from his patronage.
Today's civilian-led government in Bangkok masks the real, albeit
discreet, business and political clout of the Thai military and
police behind the scenes.

President Soeharto's recent appeal for a more competitive
Indonesia may or may not have a hidden political agenda. What is
clear is that as the country moved towards "APEC 2020", two
entirely new generations of Indonesians will come to the fore,
particularly in the professions. Pressures to establish a civil
society will be more evident as these young Indonesians come of
age.

Ultimately, a nation's true merit will be judged by how the
more fortunate treat the least fortunate members of society. As
skilled professionals who take Indonesian unity for granted,
young Indonesians reflect values and attitudes commensurate with
the realities with which Indonesia must come to grips: opening
fairer competition in domestic trade, business and services,
fostering a credible legal system in order to distribute economic
benefits more equitably, establishing credit structures which
provide fair opportunity to those in small businesses; the all
important role of maintaining a viable agricultural base to
support industrialization.

Above all, Indonesia faces the democratization challenge of
germinating leadership skills that often can only come from trial
and error on the ground: sustaining economic growth together with
broadening political participation -- without spinning out of
control.

The writer of this article is professor of International
Relations at the University of Indonesia.