Susilo ushers in new confidence

John Mcbeth, The Straits Times, Asia News Network, Singapore

One American business executive describes it as "restrained optimism". Others have called it "refreshing" and even "a wind of change".

Whatever it is, President Susilo Bambang Yudhoyono's first 100 days in office have ushered in a new mood of confidence and expectation.

More than seven years after the Asian financial crisis triggered grinding economic hardship and sweeping political change, Indonesia finally seems to be on the threshold of a new beginning.

For a country understandably cynical about most things, no one doubts Susilo's sincerity and his determination to get things done. That is important in itself. Even his critics now acknowledge that another five years under former president Megawati Soekarnoputri would have been a disaster. The retired general brings to the job everything that Megawati and her predecessor Abdurrahman Wahid did not -- a sense of engagement, a sense of organization and structure -- and, most important of all, a sense of vision.

Interestingly, it was the confluence of Indonesia's long- planned Jan. 17 Indonesia Infrastructure Summit and the fallout from the unplanned Aceh tsunami disaster that has provided him with a launch pad with which to gain some much-needed momentum. Most importantly, it has allowed him to demonstrate an assertiveness that had been missing from the early days of his leadership and which brought to the surface all the old fears about his lack of decisiveness.

The first signs appeared on Jan. 16 when Susilo indirectly criticized Vice-President Jusuf Kalla's management of the National Coordinating Agency for Disaster Relief and Refugees -- the body responsible for the Aceh relief operation. What appears to have irked the President was Kalla's controversial statement that all foreign troops helping in the relief effort should leave the stricken province by March 26, turning what the Cabinet had meant to be only a timeline into a deadline.

Presidential aides have sought to play down the apparent rift, but it was not the first time Kalla had caused controversy. In January, he was widely criticized for issuing a vice-presidential decree establishing a national team to deal with the Aceh disaster -- something that is the prerogative of only the President.

More recently, a senior aide was forced to resign when a memo leaked from Kalla's office was shown to belittle questions posed by legislators at parliamentary hearings.

Kalla's election as chairman of the Golkar party in mid- December has always seemed to be a double-edged sword, winning for Susilo the support of the country's largest and most influential party, but creating the perception that the Vice- President was the power behind the throne. That perception may continue to linger, given the powerful political and economic interests Kalla is seen to represent, but the reprimand was important in reminding Indonesians who was in charge.

This is, after all, a presidential system -- and that is not the first time Susilo has cracked the whip. Two days before, he called in his economic team and told them he was dissatisfied with the preparations for the infrastructure summit. It has left an impression. Trade Minister Mari Pangestu described the summit as the President's "trick" to force his ministers and their senior bureaucrats to come up with a slew of new regulations to win back foreign investors. "The President paid a lot of attention," she said. "He asked about it at every meeting."

Little wonder. To accelerate growth to a targeted 7.2 percent over the next five years, Indonesia needs US$150 billion (S$245 billion) in infrastructure spending. It plans to secure $60 billion of that from domestic sources, but the remaining $90 billion will have to come from foreign investors.

As it was, the summit -- and its unprecedented turnout of 10 hard-worked ministers -- pleased many in the 32-nation audience. "I think we're on the verge of something," said James Castle, veteran Jakarta-based consultant and former chairman of the U.S. Chamber of Commerce. "But talk is talk and I'll want to see the follow-up and to see if we're going to get a can-do bureaucracy."

That is the key, of course. Susilo's lack of parliamentary support was always something that could be overcome. The real challenge will be to energize the civil service, which generally sees reform as a threat to its influence and entrenched interests.

Economic Coordinating Minister Aburizal Bakrie, himself a businessman, knows the obstacles only too well. "The bureaucracy needs to improve and to be more business-friendly," he told participants. "It has to be more pro-active." International water and power companies, for example, were far from happy at the new set of regulations for their sectors, saying they enshrined some of the old thinking where the state stays firmly in the frame and long-term tariff structures remain unaffected by market forces.

Against this backdrop, it is difficult to know what to make of the uneasy Susilo-Kalla relationship and whether it could disturb the functions of government. Political insiders say the President regards the diminutive Kalla as essentially a trader who may not have a long-term perspective, but is valuable in getting things done.

"The rivalry might confuse people, but I don't think there will be a real clash," says one palace aide. "Mr. Kalla is very decisive, he's a man of action. He comes up with aggressive ideas and pushes Susilo to adopt them. Susilo is different, he has to think a lot before he makes a decision."

It is important to remember, however, that the Sulawesi tycoon was the first person Susilo went to when he was looking for a running mate. It was also clear from the start that unlike the tea-pouring vice-presidents of the past, Kalla would be given a real job, supervising mostly micro-economic issues. Controversial as it was, the subsequent choice of Bakrie, another ethnic Indonesian wheeler-dealer, as head of the economic team also fitted into the President's desire for a business-orientated Cabinet.

Ever since, however, businessmen and political activists alike have been looking for signs that Kalla and Bakrie are using their positions to enrich themselves and those around them, with rumors already circulating that their companies are preparing to cash in on lucrative reconstruction contracts in Aceh.

True or not, they demonstrate the depth of a national mindset which takes it for granted that self-interest rather than national interest guides people in power. That is still a mountain Susilo has to climb, but the 62 percent mandate he enjoys from Indonesian voters provides him with a potentially important weapon if he ever cares to use it.

The writer was formerly the Jakarta correspondent for the Far Eastern Economic Review.