Habibie to call for elections by 1999 Indonesian leader yields to pressure

Washington Times, May 25, 1998

JAKARTA, Indonesia - President Bachruddin Jusuf Habibie is ready to accept genuine economic reform and new parliamentary elections within a year to save the country from continued turmoil, a leading opposition leader said yesterday.

Muslim leader Amien Rais disclosed the results of a private meeting with Mr. Habibie as five more members of the president's newly installed Cabinet joined the top economic minister and public outcry for a new presidential ballot.

For Mr. Habibie, whose term officially ends in 2003, early elections may be the only way out of a vicious cycle of economic and political instability - each feeding on the other - that threatens to drive Indonesia deeper into poverty.

Food prices have continued to rise since Mr. Habibie took over last week, and investors continue to shy away from the rupiah currency, which took a nose dive when the unrest broke out.

"The best-case scenario is higher unemployment, higher inflation and higher poverty levels," said Mari Pangestu, a leading Indonesian economic analyst. "It is going to get much darker before there is any chance of light."

Mr. Rais, head of Indonesia's second largest Islamic group, said Mr. Habibie briefed him and other opposition figures Saturday night about his plans.

He said the president planned to announce in the next few days that he would call parliamentary elections within one year. A new president and vice president would be elected within the following year by the top constitutional body, the People's Consultative Assembly.

Mr. Rais said Mr. Habibie did not say whether he would stand for re-election, according to Reuters news agency.

"He just smiled - a smile can mean many things," Mr. Rais was quoted as saying.

The pressure for elections increased when five Cabinet members joined the top economic minister, Ginandjar Kartasasmita, in calling for an early vote. They were the ministers of finance, industry and trade, national development planning, and state enterprises' empowerment, and the Bank Indonesia governor.

Disillusioned palace sources said Mr. Ginandjar had largely dictated the makeup of the new Cabinet, which includes many holdovers from the Suharto government, in a bid to position himself to become chairman of the ruling party, Golkar.

"Ginandjar is thinking only of himself. By taking care of the old guard, he figures he can take over the party, and then if there's an election, who knows?" said one Habibie loyalist.

Mr. Rais said Mr. Habibie had also decided to set up a council to advise on political and economic reform, which would include opposition figures such as former Environment Minister Emil Salim.

"The government, according to Habibie's promise, will implement whatever proposals they introduce," Mr. Rais said.

The opposition leader said the president would also release today two prominent opposition figures. They are former opposition politician Sri Bintang Pamungkas and labor leader Muchtar Pakpahan, high-profile critics of Suharto.

Mr. Rais' remarks offer hope that the country will be spared a debilitating power struggle that could only delay its coming to terms with the very economic crisis that sparked the unrest of recent weeks.

There is no prospect of employment for the 10 million Indonesians who lost their jobs since the economic meltdown began, the nation's crippling $70 billion corporate debt remains unchanged, inflation is soaring unchecked and food shortages are rife.

Experts from the International Monetary Fund are due in Jakarta this week to assess the situation, but a decision on releasing the next $1 billion payment of the $43 billion aid package has been indefinitely delayed.

Mr. Habibie has declared his commitment to the IMF agreement signed by Suharto, but it was the IMF-mandated removal of fuel subsidies that sparked the uncontrolled rioting that marked the beginning of the end.

A longtime Habibie aide was arguing over the weekend that political reform would have to wait until the economy was stabilized.

"Right now the country is strangled by debts. Stabilizing the economy has to be the first priority," he said. "Without money, we can't afford an election. That's the simple reality."

It promised to be a hard argument to sell.

"The longer we maintain this political structure the longer it will take to overcome the economic crisis," countered Adnan Nasutian, a longtime political activist close to the student movement.

Armed forces commander Gen. Wiranto, meanwhile, has moved swiftly since the resignation of Suharto on Thursday to consolidate his own power base.

He announced the dismissal over the weekend of his No. 2 man and chief rival, Suharto son-in-law Maj. Gen. Prabowo Subianto, and several of his loyalists.

Political insiders said Gen. Wiranto, who has long been known to despise Mr. Habibie, has decided to keep him at arm's length, using him as a convenient tool to bring the country back from the brink.

By the time early elections are held, he and his allies are said to believe, the economic morass will have discredited the president.

Mr. Habibie may have his own plan for dealing with Gen. Wiranto.

As the Cabinet was being put together, there was a move to strip the general of his job as defense minister, which he has held since Suharto's re-election in March. In the end Mr. Habibie concluded it was not yet the right time.

* This article is based in part on wire service reports.

Photo (color), Bachruddin Jusuf Habibie


Copyright Washington Times Library May 25, 1998

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