Reflections on 20 years of reform: former Foreign Minister Alexander Downer

Photo by the UK Foreign and Commonwealth Office.

 

You were Australia’s Foreign Minister in 1998. Where were you and can you describe how you felt when you first heard Soeharto had resigned?
I don’t remember exactly where I was when Soeharto resigned but in the circumstances, and on the basis of information I had available to me as Foreign Minister, I was not especially surprised. He was an old man who had overstayed his time as president.

 

What has been the most significant reform of the post-Soeharto era?
What has been remarkable in the post-Soeharto era has been the evolution of successful democracy in Indonesia. It hasn’t been perfect and there have been jolts along the way but Indonesia can successfully claim to be the world’s third largest democracy. Each of the post-Soeharto presidents has generally acted in a manner consistent with democratic principles. So has the national legislature.

 

What has been the biggest disappointment of the post-Soeharto era?
I’m not sure that disappointing is the right word but the fact that there is still a substantial problem with corruption in Indonesia is unfortunate. This militates against investment, particularly foreign investment, because of the high sovereign risk involved. Unfortunately, the government still has a special place in its heart for mercantilism and interventionism, which is holding back economic development.

 

Do you think that the reform process has ended? If so, when?
Indonesia’s biggest challenge is economic reform. It needs to liberalise and open its economy to foreign investment and more competitive pressures. It also needs to make its legal system more credible, less corrupt and more honest. I don’t doubt that more efforts will be made to achieve these sorts of reforms as the years go by, but for the moment not a lot seems to be happening. The exciting period of reform gradually ground to a halt during the presidency of Susilo Bambang Yudhoyono and the momentum for reform hasn’t picked up since. But it probably will sometime in the future because reform is necessary – even if it isn’t always popular.

 

What do you think Indonesia still needs to do to further consolidate democracy?
There is no doubt that more work needs to be done to consolidate democracy in Indonesia. Most of the structures of democracy are in good shape – it has an independent electoral commission, largely free and fair elections, and a relatively free and competitive press. There are still transgressions of international norms of human rights although not as much as once used to be the case. Likewise, corruption has crept into many aspects of Indonesian society and that does have a corrosive effect on democratic institutions.

 

Is Indonesia a more attractive place for foreign investment than it was under Soeharto?
It’s difficult to argue that Indonesia is more attractive as an investment destination today than it was under the Soeharto regime. Concerns about the independence and integrity of the judiciary, the sovereign risk of capricious government policy making, and a natural inclination among the governing class towards protectionism all militate against foreign investment. These factors have not changed greatly over the last 20 years.

 

There is emerging concern about democratic regression in Indonesia. Do you believe there is a risk of Indonesia returning to a more authoritarian style of rule?
I think it is unfair to talk of democratic regression or growing authoritarianism in Indonesia. I doubt there is any inclination to return to a system of government that the public have overwhelmingly rejected. Indonesia is still growing steadily, living standards are rising and poverty is diminishing. In that environment, the public are unlikely to encourage any reversion to the previous state of affairs.

 

Do you think there is a chance that the military will ever come out of the barracks again?
There is no sign that the military is planning to take control of the country. However, as with so many countries that have fought their colonial rulers for independence, the army has a special place in society. On the whole, I suspect the public are comfortable with that and have great pride in their military. Not everyone of course, but most people.

 

Does rising Islamic conservatism pose a threat to Indonesian democracy?
Indonesia has handled Islamic extremism well. Of course, there have been a number of tragic incidents, not least those that occurred in the last few days. But this is a country of over 260 million people, most of whom are Muslims. In this context, it is remarkable how little tolerance there is among most of the population for extreme forms of Islam.

 

Indonesian security agencies have worked with foreign countries, such as Australia, to counter extremism, and there will always be a temptation on the part of the police, intelligence agencies and the military to go after potential terrorists ruthlessly. This can often raise concerns among observers concerned about human rights. Sometimes these concerns are justified, sometimes they are not.

 

The Indonesian government has also done effective work in the education system as part of wider efforts to counter the radical instincts of a tiny percentage of the population. This helps explain why, so far, ultra-conservative ideologies like Wahhabism/Salafism have not gained great traction in Indonesia. While we might expect there to be many more individual instances of violence, the vast majority of the Indonesian population has no interest in extremist forms of Islam. On the whole, mainstream Muslim organisations like Nahdlatul Ulama and Muhammadiyah have shown effective leadership.

 

How has Indonesia’s place in the world changed since 1998?
Indonesia plays a modest role in international affairs. Outside ASEAN it carries very little weight because it does not endeavour to project power or influence. During the Soeharto era, Indonesia dominated ASEAN. These days its influence is substantially less.