Throughout south-east Asia the economic crash of
1997 threatened political stability and authoritar-
ian leaders. One of the worst affected by the eco-
nomic debacle was Indonesia. Public anger turned
on Suharto and his corruption and nepotism. In
May 1998 he was forced out of office. The elected
regimes following Suharto’s fall were unable to
master the turbulence into which Indonesia
descended. After the fall of Suharto, the old, half-
paralysed vice-president, B. J. Habibie became
president. The elections of 1999 removed from
power the Golkar Party, the subservient supporters
of the corrupt Suharto and of Habibie with close
ties to the powerful military. A new era appeared to
open with the victory of the supporters of
Megawati Sukarnoputri, daughter of Sukarno the
founder of Indonesia. Megawati has been cautious
in adopting fundamental economic and democratic
reforms to rid the country of corruption. Golkar
remained a power in the land. Trying to govern the
largest Muslim country in the world riddled with
ethnic and religious strife and regions fighting
for independence at the same time as with an econ-
omy trying to recover from meltdown is not a
good opening for the new democracy. Megawati,
aloof in public contact, is no charismatic leader.
Indonesia is an overwhelmingly moderate
Muslim country but radical Islam has made
inroads. There are likely links between extremist
terrorist groups and al-Qaeda. An attack on a
night club frequented by Westerners in the tourist
paradise of Bali on 12 October 2002 killed an
estimated 190 young men and women, almost
half of whom had come from Australia. Megawati
has not cracked down on radical Muslim groups
although emergency powers are in place. Her
judgement is that this would only add to the strife
in her country.
Megawati was ousted in October 2004 at the
first direct presidential elections. Indonesia has
become a vibrant democracy with 80 per cent
casting their vote. Susilo Bambang Yudhoyono, a
retired general, was elected. Daunting challenges
face him: slow economic growth, high unem-
ployment, corruption, ethnic violence in Aceh
and Papua and the threat of militant Muslim ter-
rorism. But with huge resources there are
prospects for a better future for the people.
World attention was drawn to Indonesia in 1999
when people of East Timor were promised by
Habibie a plebiscite to decide on whether to
remain in Indonesia or become independent. A
guerrilla movement had struggled for independ-
ence since the invasion of the former Portuguese
colony by the Indonesian marines on 7 December- The harsh struggle had cost thousands of
lives. When the new, elected government of
Indonesia, twenty-four years later in September
1999, offered the plebiscite organised by the UN,
the people of East Timor voted by a large major-
ity for their independence. The consequence was
a rampage of destruction and killings by militia
organised by the Indonesian army out of Jakarta’s
control. A quarter of the population of about
800,000 fled, a few found refuge in the UN com-
pound guarded by the helpless UN monitors. The
capital Dili was practically razed to the ground. It
is estimated that as many as 200,000 may have
lost their lives. Television broadcasts spread news
of the horror around the world and galvanised the
members of the United Nations. An Australian-
led UN peacekeeping force restored order and the
UN set up a transitional administration. For
Habibie the East Timor disaster was the nail in
the coffin for his presidential hopes of being
elected. For East Timor it was a new beginning.
Reconstruction was assisted by able UN-
appointed administrators and by financial aid to
help the people living at little more than subsis-
tence level. The early years of independence
were fraught with difficulty. The minority of East
Timorese who supported the Indonesians fled
to West Timor. Democratic politics are in their
infancy after a constitution was framed and elec-
tions in 2001. The president and one time leader of
the independence struggle José Gusmáo is a widely
respected force for moderation but shares power
with a prime minister of far more radical bent. In
May 2002 the transitional administration came to
an end and East Timor gained its full indendence.
Its current poverty will be transformed when the
Australian–East Timor agreement to exploit the
oil and gas in the offshore fields of the Timor Gap
brings rich royalties to the nation. It must not be
dissipated like the oil riches of Nigeria if East
Timor is to develop over the next generation.