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Indonesia's future prospects: separatism, decentralisation and the survival of the unitary state.

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Current Issues Brief

No. 17 1999-2000

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State

ISSN 1440-2009

 Copyright Commonwealth of Australia 1999

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This paper has been prepared for general distribution to Senators and Members of the Australian Parliament. While great care is taken to ensure that the paper is accurate and balanced, the paper is written using information publicly available at the time of production. The views expressed are those of the author and should not be attributed to the Information and Research Services (IRS). Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion. Readers are reminded that the paper is not an official parliamentary or Australian Government document. IRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

Published by the Department of the Parliamentary Library, 1999


Current Issues Brief No. 17 1999-2000

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State

Grayson Lloyd Foreign Affairs, Defence and Trade Group 27 June 2000


I would like to thank Professor Arief Budiman and Dr Frank Frost for comments on a draft of this paper.


Information and Research Services publications are available on the ParlInfo database. On the Internet the Department of the Parliamentary Library can be found at:

IRS Publications Office Telephone: (02) 6277 2760


Major Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

A Survey of Current Events in Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

(I) Indonesia's Unitary State: Origins and Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Early Challenges to the Unitary State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

(II) Decentralisation in Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

(III) Demands for Independence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

(a) Papua . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

(b) Aceh . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

(IV) Australia, the Region and Indonesia's national unity . . . . . . . . . . . . . . . . . . . . . . 13

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Endnotes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


Major Issues

This paper argues that the unitary state of Indonesia, while experiencing a period of deep political, economic and national identity crisis at the moment, is unlikely to disintegrate. Historically the Indonesian nation-state has evolved from colonialist boundaries and developed in an unorthodox fashion. Yet the territorial integrity of Indonesia has survived numerous regionalist and separatist campaigns in the past. For it to do so in the future in part requires domestic political stability in Indonesia, the effective implementation of a program of decentralisation to cater to regionalist concerns and the sensitive handling of the concerns of genuine independence movements in Aceh and Papua and anywhere else they may arise.

It is easy, (although perhaps misleading) to believe that the resolve of Indonesians to stay together as a nation will overcome concerns about national disintegration or disunity. Indonesia's more than five decades of statehood have been moulded in part by military force, in part by political and administrative control (colonialism) from the centre and partly through the consistent application of assimilationist policies intended to unify (not always successfully) social, cultural and ethnic differences. The problems of regional autonomy and independence movements now threatening Indonesia's national unity are the legacy of this history. President Abdurrahman Wahid, under increasing domestic pressure on a number of fronts, is being forced to walk a fine line on the questions of regional autonomy/decentralisation. Jakarta must exhibit sufficient control from the centre to somehow elicit cooperation from the regions.

The post-Soeharto transition towards democracy and civil society in Indonesia has illustrated the fragility underlining Indonesia's national slogan of Unity in Diversity (Bhinneka Tunggal Ika). In the last couple of years calls have increased for Indonesia to adopt a federalist or decentralised system and to devolve more powers to regional areas in part to stymie separatist and independence movements. In April 1999 former President Jusuf Habibie sparked the decentralisation process with the signing of two important laws designed to promote regional autonomy and fiscal balance between the centre and regions. Unlike President Soeharto's heavy-handed approach, President Wahid has adopted an

approach in Papua and Aceh based on political dialogue designed to achieve a compromise on the basis of extensive special autonomy. Whether or not this approach succeeds is a moot point, especially given the changeability of the Wahid mind-set. The Government seems disinclined to move to the granting of full independence in either province and it remains uncertain just how far the independence movements in both are prepared to push the issue especially given the continued threat of military retaliation.

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State



There are a myriad issues causing genuine concern in post-Soeharto Indonesia although none is more important than the survival of the unitary state and the potential for national disintegration. At this time of significant economic and political crisis in Indonesia, the administration of President Abdurrahman Wahid in fact faces two rising and parallel challenges.

The first challenge is the requirement to implement an ambitious decentralisation program designed to deal with demands for regional autonomy but which is likely to stretch the administrative and political resources of the Government. The struggle for more economic and decision making parity between the highly centralised and often authoritarian Government in Jakarta and the resource laden but ostensibly disenfranchised and under-financed regions has shadowed Indonesia's development as a nation.

The second challenge involves coping with demands for independence in Aceh and Papua, which of all of Indonesia's restive provinces are the areas with the most obvious and credible independence credentials at the moment. Despite renewed calls for independence from activists within both regions the central Government in Jakarta is unlikely to sanction independence in either province. For varying reasons both Aceh (where there was recently signed a humanitarian pause between the Government and the Free Aceh Movement (Gerakan Aceh Merdeka, GAM)) and Papua (scene of the recent landmark Papuan People's Congress) are important test cases for Indonesia's national unity. Given its history of close association with the Republic, especially during the 1945-9 revolutionary period, many observers in Indonesia fear that the secession of Aceh would mark the beginning of the decline of the Indonesian state. However, it does not necessarily follow that independence by one or both regions would precipitate the domino-like collapse of the Indonesian nation-state especially given the paucity of genuine independence (not to be confused with devolutionist) movements in other provinces. As the East Timor case demonstrated, the Indonesian nation-state is capable of shrinking without collapsing.

This Paper is divided into four distinct parts. After a brief survey of recent developments in the reform and political process in Indonesia, part one addresses the question of the formation of Indonesia's unitary state and the challenges it has faced particularly in the first few decades after independence. Part two surveys the issue of decentralisation in Indonesia and the challenges facing this process in the future. Part three focuses on the struggle for independence in Papua and Aceh. Part four reviews the significance of these issues for Australia and the region.

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


A Survey of Current Events in Indonesia

In this reformist political period, the Indonesian nation is struggling to effectively integrate an infant democratic system presently lacking cohesion. Indeed it is a difficult task for an administration that has been in place for less than a year to institute a democratic system after more than thirty years of authoritarianism. While the economy is showing some signs of improvement, the ramifications from the Asian financial crisis of August 1997 are still widely evident and will persist for some time to come. The World Bank and International Monetary Fund (IMF) backed restructuring and rehabilitation of Indonesia's banking and corporate sectors is under way but much remains to be done. The scale of reconstruction required in the judicial system—needed to institutionalise an equitable justice system and to restore the faith of foreign investors—is, quite simply, staggering. Both of these processes—legal reform and corporate and bank restructuring—are complicated by the uncertainty of the domestic political situation.

The Indonesian military (TNI) is a disillusioned organisation increasingly sidelined from formal politics.1 None the less, despite the broad ranging reform process experienced by the military in the last few years, it retains a significant potential to influence political events in Indonesia through its territorial organisation. The military's territorial units are dispersed throughout the archipelago essentially partnering organs of civil Government. As such the TNI is able to rationalise interference in local politics on the basis of maintaining 'stability'. This is likely to have significant ramifications for the democratisation process in Indonesia. The possibility of increased regional autonomy in Indonesia may result in greater regionalism in the TNI and hence division along ethnic, religious and regional lines.2 Further complicating the future position of the TNI is the ambiguity over its dual function role (dwifungsi).3 This has directly contributed to the sense of political uncertainty and regional instability in Indonesia.

President Abdurrahman Wahid has been under siege recently following the sometimes controversial and perplexing dismissals of various ministers and advisers. The President's health and leadership skills have come under intense parliamentary and public scrutiny— especially from People's Consultative Assembly (MPR) Speaker Amien Rais, and also from assorted radical Islamic groups. The Government appears to be foundering amid allegations of corruption and perceived errors of judgement against the background threat of a coup. Dealing with calls for regional autonomy/independence and instituting an effective decentralised system assume an ever more pressing position on the Government's agenda. To date President Abdurrahman Wahid's response to the issues of separatism and decentralisation has been cautious. There is no sense that Jakarta's elite has a blueprint for overcoming regional pressures—indeed perhaps none exists. However it is crucial in addressing this issue that sustained economic development and durable political stability is achieved. The lack of both does not augur well for future endeavours to resolve regionalist issues or to lessen the sense of crisis pervasive in Jakarta at the moment.

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


(I) Indonesia's Unitary State: Origins and Challenges

The Republic formed in Indonesia had a rather unsettled beginning. This was in part a reflection of the arbitrary nature of its colonially determined boundaries and the ethnic and cultural diversity of its people. Indonesian nationalism evolved quite rapidly after the 'liberation' of the Netherlands Indies by the allies at the end of the Second World War. However, the growth of virulent anti-colonialist (anti-Dutch) nationalism was tempered by the sizeable political and administrative gulf between Java and Sumatra and the outer islands.4 The constitution of the new Republic established on 17 August 1945 made some concession to the autonomy demands of the outer islands by creating seven provinces, although it moved away from regional autonomy.5 The Republic at this point bore little resemblance to current day Indonesia. Control had been assumed in Java, much of Sumatra and somewhat less securely in Bali and South Sulawesi, although the youth movement (pemuda) was challenging the Dutch elsewhere notably in Sumatra.

There was deep suspicion among Republican leaders of the Federal model developed by the Dutch in early 1946. The model proposed a federal system encompassing four states: Sumatra, Java, Borneo and Eastern Indonesia each with differing degrees of autonomy. Republican leaders believed the federal idea represented a tactical policy of divide and rule designed to split the nationalist movement and prey on outer island suspicions and mistrust of Java.6 It was viewed as a means of extending Dutch influence after the transfer of sovereignty to the Republic—making the federated states puppets of the colonial regime—and thus, as one observer has noted, ensuring that support for the unitary state became an article of nationalist faith.7 It has been observed elsewhere that such a model did not accord with Javanese perceptions of the unified nature of authority and power.8 Full sovereignty was transferred to the newly created Federal Republic of Indonesia (Republic Indonesia Serikat, RIS) in December 1949. In less than a year the federalist model, viewed by Republicans as a necessary short-term compromise, was replaced by the unitary Republic proclaimed in August 1945.

Early Challenges to the Unitary State

The anxiety with which many among Indonesia's leadership elite view the question of threats to the nation's unity is sourced in the tumultuous nature of the first decade and a half after the Republic's birth. The distinguished American anthropologist Clifford Geertz has written:

Archipelagic in geography, eclectic in civilization and heterogeneousin culture, Indonesia flourishes when it accepts and capitalizes on its diversity and disintegrates when it denies and suppresses it9

This statement is as pertinent to the reforming Indonesia of today as it was to the period of parliamentary democracy and Guided Democracy in Indonesia during the

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


1950s and the first half of the 1960s. Furthermore in many respects the Indonesian social and political system is as vulnerable now as it was during the traumatic events in 1965-66 which brought President Soeharto to power. The collapse of Soeharto's authoritarian regime on 21 May 1998 produced a vacuum of political authority in Indonesia. Indonesia is searching for a figure capable of filling this vacuum and advancing the causes of democracy, civil society and justice in the present environment clouded by economic hardship and fragile national unity. In such an environment calls to be aware (sadar) of threats to the nation's well-being assume a greater resonance than they did under President Soeharto's authoritarian regime where they were widely viewed as techniques for maintaining political control.

The decade and half after independence was characterised by sporadic regional dissidence, calls for greater local autonomy and what one observer described as 'centrifugal pulls of an economic system which the Jakarta Government appeared quite unable to control.'10 In the early days of the Republic the authority of the central Government was challenged by various movements particularly, but not exclusively, in areas where the power of the Government in Jakarta was incomplete or non-existent. In the South Moluccas, for instance, resistance to the central Government was led by pro-federalist elements unhappy with the dismantling of the Dutch-sponsored federal state in 1950. The Government eventually managed to overcome this revolt by military force.

In West Java a Darul Islam insurgency began in 1948 and persisted as a movement of regional, social and religious discontent which the Government was largely powerless to stop until the death of the movement's leader in 1962. In 1953 a serious regional revolt broke out in Aceh with political, economic and religious origins. In South Sulawesi a rebellion influenced by Darul Islam and led by Kahar Muzakkar began in 1951 and continued until 1964. In these last two cases, the central Government created a considerable degree of animosity by appointing outsiders to important positions over local men (anak daerah).11

However perhaps the most significant post-revolutionary threat to Indonesia's unity emerged with the PRRI-Permesta regionalist challenge in 1957-8 in Sumatra and Sulawesi. These revolts posed a direct challenge to the power and authority of the central Government. And while they were easily crushed, the revolts none the less marked the end of Indonesia's relatively brief flirtation with parliamentary democracy, thus heralding the re-emergence of the 1945 presidential constitution and the era of President Sukarno's Guided Democracy (demokrasi terpimpin). Ostensibly from this point in the late 1950s the power of the central Government in Indonesia has been all pervasive, particularly in establishing uniformity in education, health and numerous other areas extending down to the village level. With the exception of the Fretilin-led struggle in East Timor, regional and independence movements in Indonesia struggled throughout the New Order period to attract domestic understanding or consistent international support.

The regionalist cause in Indonesian history has generally followed a well-worn path. Whether conceived religiously, ethnically or on a broader nationalistic basis it tends to

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


espouse the feeling that the present system has not justly distributed the resources derived from the people and argues against the decision making process in the nation-state as the preserve of a narrowly defined elite. Invariably regionalist campaigns are also influenced by local power struggles between religious or political moderates and radicals and by those who dislike domination by the centre (Java). Separatist movements, however, are typically more complex than simple regionalist demonstrations of angst against the centre. They propound the cause of independence on the basis of long held cultural, social or historical distinctiveness, and often possess an international element. Such factors are evident in the cases of Aceh and Papua which have retained long-term relevance, and have been treated as serious threats to the long-term stability of the Indonesian nation-state.

Contrary to the argument of numerous media reports predicting otherwise, East Timor's independence has not been a catalyst for general state collapse in Indonesia. Fears sponsored by the armed forces and ultra-nationalists that the loss of East Timor would trigger the disintegration of the unitary state have so far proved unfounded. That said, the independence movements in Aceh and Papua have certainly been rejuvenated by events in East Timor. However East Timor was a special case. Its people are overwhelmingly Catholic, it was never a part of the Dutch East Indies (the precursor to the Indonesian Republic), and moreover the United Nations did not recognise the territory's absorption into Indonesia. In nationalistic terms Indonesia is thus no less Indonesian after the loss of East Timor—indeed it may be more so.12

In other areas, such as oil-rich East Kalimantan and the similarly oil abundant Riau in Central Sumatra, the problems centre on regional autonomy and the ever-present regional demand for a larger return on oil or other revenues from the central Government. In Maluku (especially Ambon and Halmahera), and West Kalimantan the central Government is faced with provinces afflicted by widespread inter-communal violence and disorder. These are neither separatist nor independence campaigns, however they do represent a continuing challenge to the maintenance of national unity.

Indonesia has not yet reached the point where it can take its national unity for granted. In reality it is unlikely to arrive at such a point, but it does not follow that Indonesia will fracture and collapse. There are at least two significant reasons why this is unlikely to happen. The first is that no political, economic or other agenda in Indonesia would be served by disintegration.13 The second is that many if not most Indonesians recognise that the economic and social justice benefits achieved by remaining united—challenging though this is in the present climate—outweigh the potential consequences of disintegration.14 But the resolve of Indonesians to stay together as a nation is not in itself sufficient. This resolve will need to be accompanied by sensitive Government policies and a genuine desire to overcome real and widespread problems.

The Indonesian nation was constructed in an arbitrary manner and given the very considerable heterogeneity of its ethnic groups and cultures, and the spread of the people across an elongated archipelago, it is surprising that Indonesia has remained 'unified' for as long as it has. During the authoritarian New Order (1966-98) period this unity was

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


enforced from above. The New Order's veto on discussion of racial, ethnic and religious issues (so-termed 'SARA' issues) combined with pervasive administrative control from the centre together maintained the veneer of national unity.15 Observers of the Indonesian situation find themselves caught between warning of the fragility of the nation's territorial integrity and celebrating the staggering nation-building achievement that has taken place. President Sukarno's mantra was nation building—a vision he pursued with much gusto. President Soeharto was described as the one who could fulfil the nation's potential; in a way giving substance to Sukarno's vision. However, the results on this front were mixed. The challenge for Abdurrahman Wahid is to maintain Indonesia's status as a unified state.

(II) Decentralisation in Indonesia

Indonesia is the fourth most populous country in the world. Its people are dispersed over an elongated archipelago consisting of thousands of islands. These factors, together with the archipelago's tremendous ethnic and cultural diversity, mean that Indonesia requires an effective system of local governance. Along with its neighbour Malaysia, Indonesia appears to meet the criteria for a federal structure. However for reasons outlined earlier, Indonesia's experience of such a system has left a lasting distaste.16 In April 1999 the administration of President Habibie signed two very important laws to promote regional autonomy. The first was Law 22/1999 on regional Government, and the second, Law 25/99 on balancing finances between the central and regional Governments. Before examining the nature and likely ramifications of these laws a little background is required.

In 1903 the Dutch Government introduced a form of decentralisation in Indonesia to increase the efficiency of Government administration.17 Nearly two decades later district level Governments were established to create more representative administrations. However the concept of decentralisation has experienced a rather vexed history in Indonesia. Debate on the issue has been inconsistent and vague despite broad agreement on the need for regional autonomy in a country the size of Indonesia. During the Sukarno era, from the late 1950s until the mid-1960s, instead of promoting democratic Government decentralisation became a mechanism promoting political stability.

It was only with Law 5/1974, set forth nearly three decades after the proclamation of independence by Sukarno and Hatta, that Indonesia developed a more concerted approach to decentralisation. However implementation of this law under the Soeharto administration might be conservatively described as gradual. This law established the legal basis for the current system of regional/local Government and emphasised the mobilisation of the regions in the effort of national development.18 The law embodied three principles for the distribution of Governmental functions: (i) decentralisation of responsibilities to 'autonomous' provincial and local Governments (i.e. kotamadya and kabupaten level); (ii) de-concentration of activities to regional offices of central ministries at the provincial and local level; (iii) co-administration whereby provincial and local Governments carry out activities on behalf of the central Government. The essence of the law was designed to

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


rein in local autonomy by emphasising obligations to the central Government over regional rights.19 The law governed both the administrative structure of the central Government and the gradual spread of regional autonomy without intending to provide every province with autonomous Governments. Regional autonomy was an almost incidental detail. Law 5 was ostensibly intended to promote national stability through the promotion of an authoritarian structure extending from Jakarta to village level Indonesia.

Law No. 5 was not designed to govern central-local financial relationships for which purpose a follow up law was intended. Debate on this issue has been complicated by a lack of consensus within the Government on the form of decentralisation to be pursued and by the issue of the distribution of national resources between regions.20 This has been a sensitive issue given the central Government's dependence on resources from certain outer islands and the subsequent spending of these revenues in more densely populated and less well endowed regions such as Java.21 The issue of regional autonomy triggered a debate between supporters of the existing unitary system (notably the Megawati Soekarnoputri headed Indonesian Democratic Party of Struggle, PDI-P) and those advocating an examination of a federalist alternative (especially the leader of the National Mandate Party, PAN, Dr Amien Rais).

In this context the legislation introduced by the Habibie administration in April 1999 proposed a radical model of extending broad regional autonomy within the existing unitary constitution. The two basic levels of governance under Law 22/99 on regional Government are the central Government headed by President Abdurrahman Wahid and the autonomous local Governments of Kabupaten (districts) and Kotamadya (cities).22 The implication of Law 22 is that there is a division of powers and responsibilities between these levels of Government that is not strictly hierarchical.23 Reinforcing this position, and contrary to the manipulated elections of the Soeharto period, it provides for the (supposedly free) election of provincial governors and district heads.

The powers under Law 22 decentralised authority over all fields except foreign affairs, defence, security, justice, monetary and fiscal policy, religion and certain economic policy areas.24 Interestingly the powers under the law are devolved to the 300 or so districts throughout Indonesia and not to the 26 provinces.25 Provincial Governments will handle central Government affairs in the regions and any tasks not able to be dealt with by the district administrations because of lack of appropriately trained personnel. Doubt has already been raised by some ministers in the central Government over the state of readiness at the district level to undertake activities many ministers see as better carried out by the central organisation in the name of a 'national' policy.26

Law 25/99 on balancing finances between the central and regional Governments is the corollary of Law 22. Basically, if properly implemented, it will allow regional Governments to secure a considerable portion of the revenues produced in their regions. Under the new law the regions would be permitted to retain 80 per cent of revenues from forestry, fisheries and general mining, 15 per cent from oil and 30 per cent from natural gas. 27 Also within the scope of the law is a re-allocation of 25 per cent of the central

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


Government's budget to the regions based on needs and economic potential. Although intended as a means of placating the resource-rich regions (East Kalimantan and Riau for instance) which have been consistently milked for huge profits by Jakarta with little local benefit, it is easily imaginable how this policy will result in a decrease in funds flowing to resource-poor regions.28

The problem with both laws is that they have yet to be implemented and this exacerbates their ambiguity and lack of clarity and certainty. Full implementation of regional autonomy is expected to occur in 2001. A number of potential problems will need to be addressed in the interim. Perhaps the most obvious is the capability of district Governments—in skill and personnel terms—to cope with the full range of powers conveyed to them under the new laws. Concerns also arise over the potential for powerful foreign or domestic interests to exert economic pressure on individual district Governments on matters relating to mining or forestry contracts and negotiations. Even more fundamental is the likelihood of jurisdictional disputes arising between local and central Government officials. Examination will now focus on the second part of Indonesia's parallel crisis—independence movements in Papua and Aceh.

(III) Demands for Independence

(a) Papua

At the Hague Round Table conference in August 1949 the status of West New Guinea (or Irian Jaya as it came to be known under Indonesian control) was not included in discussions leading to the transfer of sovereignty from the Dutch to the Republic of Indonesia. Dispute over the exercise of sovereignty in the territory continued well into the 1960s. As tensions increased between Indonesia and the Netherlands in the early 1960s, culminating in a brief military engagement in 1962, the international climate moved against the Netherlands. Australia, which until late 1962 had been supportive of Dutch policy on the issue, now followed the lead of the United States and urged the Dutch to form an agreement with Indonesia regarding the future of West New Guinea. An agreement was signed in New York in 1962 under which West New Guinea was placed under UN Temporary Executive Authority (UNTEA) awaiting an 'act of self-determination in accordance with international practice.'29 (See forthcoming Current Issues Brief, 'Is West Papua Another East Timor?' by Dr. J. R.Verrier).

In 1969 the so-termed 'Act of Free Choice' took place designed to determine the future status of West New Guinea. Predictably the 1025 delegates from West New Guinea selected by the Indonesian Government decided in the popular consultation to join the Republic of Indonesia. Since the transfer of the territory of Papua (as it is now referred to by the Indonesian Government) to effective Indonesian control in May 1963 armed

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


Papuan rebels have conducted military-style operations against the Indonesian Government. In the early 1960s those opposed to Indonesian rule in Papua formed the Free Papua Movement (Organisasi Papua Merdeka, OPM). In 1971 the OPM announced the formation of a Provisional Republic of West Papua New Guinea, and proclaimed independence for the territory. Over the last three decades the OPM have conducted a dual policy of an intermittent guerrilla campaign and an international propaganda effort. While portrayed as a rag-tag bunch of terrorists by the Indonesian Government, the OPM has none the less managed to be a continuing source of irritation to the Indonesian Government despite its disorganisation and frequent leadership changes.

Unlike the campaign waged by the East Timorese, the OPM has never managed to attract international diplomatic support for its struggle. Private views aside, no Government has publicly disputed Indonesia's sovereignty in Papua.30 The nature of the armed struggle in Papua is considerably different from Indonesia's past experiences with armed separatism such as the Darul Islam movement and the PRRI Permesta Revolt and indeed from the successful independence campaign waged by Fretilin in East Timor. While in the past there has been a tendency to dismiss the struggle in Papua as merely a problem of national integration, such is clearly not the case now. The fall of President Soeharto marked an increase in demands for independence in Papua.

Papua is a resource, particularly mineral, rich territory. It contributes far more to the national budget than it receives in return, which is a source of considerable angst given the widespread poverty in the province. Its natural wealth has also been a major attraction to foreign companies such as the Freeport-McMoran mining company. Tom Beanal, a leader in the Amungme tribe and Vice-Chairman of the newly formed Papuan presidium, has tried in vain to sue Freeport for billions of dollars in compensation.31 Of the nearly two million people who inhabit Papua, between 750 000-850 000 were born outside the territory.32 In Jayapura (recently renamed Port Numbay) 80 per cent of the population are non-indigenous people.33 The development of a Papua-wide identity is a relatively recent phenomenon notwithstanding the cultural and historical distinctiveness of the Papuan position in the Indonesian state. Awareness of this identity has been heightened by transmigration schemes operated by the central Government which dramatically altered the ratio of non-indigenous inhabitants in Papua and further increased the numbers of non-Papuans in the civil service. Papuan identity was further accentuated, and separatist sympathies heightened, by the brutality of the operations of the Indonesian military in the territory.

From the late 1990s leadership of the independence struggle transferred from guerrilla fighters to prominent figures in Jayapura and elsewhere who viewed the change in leadership in Jakarta as offering new prospects.34 A delegation of 100 Papuan leaders met with President Habibie in February 1999 where they openly demanded independence—a remarkable indication of the changed times. Numerous independence-related flag-raising ceremonies were conducted throughout Papua in the second half of 1999. The Abdurrahman Wahid administration has pursued a similar dialogue-based approach

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


maintaining lines of communication with the Papuan nationalists. There appears little doubt, however, that if offered independence the overwhelming majority of Papuans would support such a proposal.

As the People's Congress of Papua which opened in Jayapura on 29 May 2000 indicated, Indonesia's new laws on regional autonomy and financing will be inadequate to overcome the deep anti-Indonesian feeling in Papua. Abdurrahman Wahid's 'act of good faith' to change the name of the province to Papua in a ceremony on 1 January 2000, was misinterpreted by many Papuans as an indication of his preparedness to move further on the issue. Abdurrahman Wahid was initially supportive of the Congress, provided it with funding and had intended to attend. His attitude toward the OPM has been quite progressive given the history of relations between the organisation and the Indonesian Government. He has been sensitive to details such as the flying of the OPM flag (provided it was not flown higher than the Indonesian flag) and has encouraged the expression of views. However, in defiance of warnings from Jakarta, the People's Congress ended with a declaration stating that the Papuan people reject the 1969 Act of Free Choice, and demand the United Nations revoke UN resolution No. 2504 of 19 December 1969. In essence Papua was declared to be no longer a part of the Republic of Indonesia and a quasi-legislative institution—a reformulated Papuan presidium—was formed. As the Secretary-General of the Congress, Thaha Alhamid, noted, ' West Papua has been an independent nation since 1 December, 1961.' 35 This is the date on which the territory was granted independence from the Netherlands.

The Indonesian President was clear in his response to this declaration, noting that a state within a state was not an option and independence would not be countenanced. The Indonesian Government was particularly concerned about the appeals made at the congress to international powers (the Netherlands, the United States and the United Nations) to reassess their recognition of Indonesian rule in Papua.36 In an apparent bid to appease calls for independence in Papua the Indonesian Government agreed to set up a body to investigate human rights violations.37

However this offer was quickly followed by the likelihood that Indonesia would send armed police reinforcements to Papua in the wake of the declaration by the People's Congress. What is most needed in Papua at the moment is for the central Government to prudently assess how best it can accommodate the aspirations of the Papuan people. Blanket rejection of independence by the central Government, or excessive military involvement, will likely exacerbate problems of national disunity. One problem for the central Government, however, is that it cannot be certain of the intentions of the Indonesian military. There are suspicions in some quarters that the current escalation of events in Papua is not entirely related to Papuan demands for independence but rather a part of a campaign to de-stabilise the administration of Abdurrahman Wahid. Those pushing for independence in Papua face a difficult struggle. While approximately 60 per cent of the population is Protestant, the campaign for unity and sovereignty is complicated by the diversity of the population speaking hundreds of different languages and dispersed

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


over mountainous terrain.38 None the less the Indonesian Government is right to be concerned about events in Papua. Indonesia's Minister for Regional Autonomy, Ryaas Rasyid, believes Papua is a more serious independence threat than Aceh because of the Christian basis in the province which, he believes, is more likely to garner Western sympathy than Islamic Aceh.39 This is particularly the case given the lingering resentment in Papua of the events surrounding the 'Act of Free Choice' in 1969.

(b) Aceh

Aceh is a province containing some four million people and vast resources of oil and natural gas. Indonesia is the world's leading exporter of Liquefied Natural Gas (LNG), and forty per cent of the country's LNG comes from Aceh's northern coast.40 For decades the Acehnese have seen a much greater proportion of their resources siphoned to the central Government than have been remitted back to the province.

In Aceh armed resistance opposed rule from Jakarta as early as 1953 only to fade and re-emerge in the late 1970s. The fact that Acehnese supporters of the Darul Islam movement in 1953 proclaimed the Islamic State of Indonesia in Aceh (Negara Islam Indonesia, NII) is not particularly surprising. Aceh has enjoyed a long history of Islamic identity, a trade based economy and resistance to colonial intrusion. After a thirty year war the Sultan of Aceh eventually surrendered to the Dutch in 1903 who established a civilian administration in the region allowing the Acehnese a good deal of autonomy. Aceh was the only major region to remain almost entirely free of Dutch control during the 1945-9 independence struggle in Indonesia.41 Many Acehnese felt that their role during the national revolution and their historical separateness would be recognised in the formation of an Indonesian state. Aceh confirmed its 'nationalist' credentials by refusing to participate in a Dutch-sponsored conference to establish a state of Sumatra. In early 1949 the central Government appointed military governor of Aceh, Tengku M. Daud Beureueh, noted in response to the proposal for Aceh to become self-governing in a Dutch sponsored federal system: '… we have no intention of establishing a Great Aceh state as we are Republican spirited… The Acehnese people are convinced that separate independence, region by region, state by state, can never lead to enduring independence.'42

The Acehnese were none the less united behind the creation of an Islamic state. This perspective was at odds with the national trend in Indonesia which was against the creation of an Islamic state for the nation as a whole. Relations between Aceh and the central Republican Government deteriorated when the latter moved to dissolve the province of Aceh and incorporate Aceh in a larger province of North Sumatra. With this policy in place by the early 1950s, the Acehnese felt their autonomy and identity threatened by the appointment of many Javanese and non-Acehnese to senior positions in the new province. The TNI units in Aceh were replaced by non-Acehnese units. Many Acehnese resisted the changes, but the situation was complicated by the lack of unity

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


within the Acehnese community stemming from the divisive social revolution in Aceh in 1946-7.43

A considerable transformation took place in Aceh between 1950 and the establishment of the Negara Islam Indonesia in 1953. This involved a central Government crackdown on dissent and a de-Islamisation campaign. The remainder of the decade was a turbulent period. Leaders of the Aceh rebellion had no intention of separating the region from Indonesia but envisaged it as an autonomous province. In 1955 the State of Aceh (Negara Bahagian Aceh, NBA) was announced and an Acehnese Government was established under the authority of Tengku M. Daud Beureueh. Negotiations between the NBA and the Indonesian Government continued until 1957 with Tengku M. Daud Beureueh calling for a separate state. In April of that year a cease-fire was agreed including a package promising a separate province and promotion of Islam. The rebellion in fact persisted and fluctuated in intensity for the next four years until August 1961. Despite occasional expressions of dissatisfaction over the status of the province Aceh remained relatively trouble free until the launching of the Free Aceh Movement (Gerakan Aceh Merdeka, GAM) and the proclamation of the independent state of Aceh in 1976. This decision by GAM's leader, Tengku Hasan M. di Tiro, was based on several factors at least. The first was a realisation that a federalist structure was not going to solve Aceh's problems. The second was dissatisfaction with the New Order Government's lack of commitment to development in the territory and its emphasis on policies of assimilation.

The activities of GAM continued on an episodic basis throughout the 1980s. In truth GAM is now a small group whose main architect, Tengku Hasan M. di Tiro, lives in self-imposed exile in Sweden. The campaign for independence is now increasingly led by student groups. None the less in response the Indonesian military initiated a severe counter-insurgency campaign in Aceh in the late 1980s. In fact between 1989 and 1998 Aceh was placed under military rule, during which period special army units engaged in the routine torture and murder of suspected members of the Free Aceh movement.44 Since the start of the 1990s the Acehnese had come to feel increasingly threatened by the migration of Indonesians from other provinces attracted by economic opportunities in Aceh.45 The fall of the Soeharto regime raised the possibility of change and as a consequence military atrocities were widely publicised and head of the Indonesian armed forces, General Wiranto, apologised to the Acehnese for abuses committed by his troops. President Habibie promised an investigation into human rights abuses, and many Acehnese held out hope for a change in their fortunes.

Habibie's focus wavered, however, as preoccupation with the power struggle in Jakarta left little time for attention on Aceh. And despite the public apology, military abuses and a terror campaign continued unabated in Aceh. The terror campaign conducted by the Indonesian military in Aceh far from crushing dissent, in fact broadened the wide cross-section of resentment in the territory against Indonesian rule. In other words, many students and people who would otherwise not have associated themselves with GAM reacted in unity against the brutality of Indonesian rule in Aceh via the forum of GAM.

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


The commission appointed by President Habibie in mid-1999 to inquire into human rights abuses in Aceh eventually brought a number of cases to trial in April-May 2000. However, the long delay in arranging a trial and the absence of high-ranking culprits meant that the process lacked credibility.

Large scale strikes and demonstrations were held throughout the province in support of a referendum on independence. A particularly large demonstration occurred supporting this goal in Banda Aceh on 13 November 1999. Aceh's historical distinctiveness, revolutionary history and 'national' struggle, comparatively high ethnic homogeneity (relative to other areas in Indonesia) and strong Islamic underpinning elicited considerable support for its cause among many Indonesians. It is doubtful, however, if this positive feeling extended to support for Aceh's independence. While sympathetic to the cause, Abdurrahman Wahid prevaricated on the question of independence which did not endear him to many Achenese.

In a rather desperate attempt to keep Aceh within the fold the Government compromised and offered to hold a referendum on the implementation of Islamic law—a move which fell well short of Acehnese demands. The Government's negotiations with the Acehnese (which included intervention by the Malaysian Prime Minister Mahathir Mohammad) has been complicated by the diverse strains of political opinion within the province. The Government has focused attention in this respect on the Islamic religious leaders (ulama) in an attempt to reduce the efficacy of the students, GAM and other pro-independence forces.46 In May 2000 an agreement was reached for a 'Humanitarian pause' in hostilities in Aceh. 47

This agreement may lead to more talks and perhaps the realisation on the part of the Indonesian military that the Aceh issue will not be resolved militarily. Yet herein lies the paradox for Aceh and Indonesia. While ever there is a prospect for Acehnese independence Indonesia's national integrity remains under threat and the military (or the police who now have responsibility for internal security) will be involved. However to conceive of Aceh as an independent democratic state within the Indonesian nation, a distant but not implausible possibility, the central Government in Indonesia must lessen its emphasis on national unity enforced by the military.48 While Aceh has a number of legitimate grievances, the future of the territory will be determined in significant part by the attitude in Jakarta and need not involve independence. An autonomous Aceh, for instance within a broader federalist state, may preserve Aceh's sense of place.

(IV) Australia, the Region and Indonesia's national unity

Fears of the break up of Indonesia, partly validated by the independence campaigns in Aceh and Papua, an uncertain decentralisation process, a central Government lurching from one crisis to another and the increased frequency of outbreaks of inter-communal violence heighten concerns among Indonesia's neighbours. The absolute priority for

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


ASEAN leaders and for the Australian Government (and the United States for that matter) is the stability of the Indonesian nation-state. The security and stability of the Southeast Asian region is contingent upon the survival of the unitary state of Indonesia even if this assumes a slightly different form in the future. While it needs to be considered, the alternative is a confronting possibility. The emergence of an independent Islamic Republic of Aceh, for instance, and its potential impact on Islamic insurgency in the southern Philippines and Thailand would be of obvious concern. Potentially huge scale refugee flows to Malaysia, Singapore, Australia and other areas in the wake of the fracturing of Indonesia would be extremely worrying.

However for Australia, lingering ill-feeling within the Indonesian elite over the East Timor episode means that many suspicions have to be overcome to convince Indonesia of the genuineness of Australia's support for Indonesian national unity. The situation in Papua looms as another important test case for relations between Australia and Indonesia. A number of individuals within the elite in Jakarta believe that Australia is fomenting the independence movement in Papua.49 Australian Foreign Minister Alexander Downer has explicitly refuted such allegations saying on 30 May, 'Australia has always [supported] and continues to support and to recognise the integration of West Papua within the Republic of Indonesia'.50 Prime Minister Howard asserted that Australia 'fully and unequivocally supports the sovereignty and integrity of Indonesia'.51 On this point Australia's foreign policy appears to have bipartisan support as opposition leader Kim Beazley noted in a speech in Jakarta on 2 May, 'Australia respects Indonesia's territorial integrity and is aware of the difficulties of maintaining stability in such a diverse and widespread grouping of islands.'52 It is conceivable Australia will face future challenges to this position, particularly if border disputes intensify between Indonesia and PNG. For the moment, Australia can do little but reinforce its support for Indonesia and hope that the decentralisation/regional autonomy process in Indonesia proceeds relatively smoothly.


There is no doubt that Indonesia is in a chronic state of crisis. However, the Indonesian nation-state is unlikely to disintegrate at the moment. This situation could change in the future if the authority of the Abdurrahman regime wanes, if the decentralisation laws fail when implemented and if Aceh and Papua succeed in their bids to achieve independence. In the interim the outbreaks of inter-communal violence in Maluku province (especially Ambon and Halmahera) and West Kalimantan and in other areas exacerbate the sense of crisis. The nature of Indonesia's national unity is unusual because the basis for this unity has rested at least as much upon geographical propinquity, historical accident and cultural and ethnic homogeneity imposed from above as it has on a sense of national togetherness. The Indonesian nation-state was the product of a colonial regime and has henceforth evolved in piecemeal fashion. There is a fundamental need for sensitive Governmental policy making in order to preserve national unity in Indonesia. There is a reasonable prospect that given creative policy initiatives on this issue, and other factors

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


notwithstanding, Indonesia can maintain its national integrity even if in a slightly altered form.


1. In an official seminar in September 1998 a so-termed 'new paradigm' was adopted by the military foreshadowing a dramatic reduction (but not abandonment) of its political role.

2. Greg Sheridan, 'Neighbours' Priority is a Stable Archipelago', The Australian, 11 September 1999.

3. Following a seminar in 1965 the Indonesian army produced the doctrine of the Dwi Fungsi (Dual Function) of the armed forces endorsing their dual role as a military and social-political force.

4. In 1938 the Dutch administration sought to decentralise their administration by creating three autonomous regional Governments in Sumatra, Borneo and the 'Great East'. During the interim allied administration, and indeed the Japanese occupation prior to this, the outer islands were governed separately from Java and Sumatra.

5. These were East, West and Central Java, Sumatra, Kalimantan, Sulawesi, Maluku (including West New Guinea) and Sunda Kecil. See Ron May, 'Ethnic Separatism In Southeast Asia', Pacific Viewpoint, vol. 31, no. 2, 1990, p. 29.

6. J. D. Legge, Central Authority and Regional Autonomy in Indonesia: A Study in Local Administration 1950-1960, Cornell University Press, Ithaca, 1961, p. 8.

7. ibid.

8. B.R.O'G. Anderson, 'The Idea of Power in Javanese Culture' in C. Holt, ed., Culture and Politics in Indonesia Cornell University Press, Ithaca 1972, p. 23.

9. Clifford Geertz, 'The Integrative Revolution' in Old Societies and New States, The Free Press, Glencoe, 1963.

10. J. A. C. Mackie, 'Integrating and Centrifugal Factors in Indonesian Politics Since 1945', in J. A. C. Mackie ed., Indonesia: The Making of a Nation, Canberra: Research School of Pacific Studies, Australian National University, 1980.

11. ibid., Mackie, p. 672. As Mackie notes, in the eyes of those in the central Government revolutionary records did not compare with educational attainment or bureaucratic seniority.

12. A similar argument is proffered in Donald Emmerson, 'Will Indonesia Survive?', Foreign Affairs, vol. 79, no. 3, May-June 2000.

13. Robert Cribb, 'Not the Next Yugoslavia: Prospects for the Disintegration of Indonesia', Australian Journal of International Affairs, vol. 53, no. 2, 1999, p. 175.

14. ibid., p. 177. Cribb further argues that the impact of globalisation and the trend toward small state development in international relations are unlikely to make much of an impact in Indonesia.

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


15. SARA refers to Suku, Agama, Ras and Antar-golongan—basically ethnicity, religion, race and inter-group relations public discussion of any of which was taboo during the New Order.

16. Nick Devas, 'Indonesia: what do we mean by decentralization?', Public Administration and Development, vol. 17, 1997, p. 354.

17. Terence H. Hull, 'Striking a Most Delicate Balance: The Implications of Otonomi Daerah for the Planning and Implementation of Development Cooperation Projects', Final Report of the AusAID funded ANU-LIPI project on Population Related Research for Development Planning and Development Assistance, 3 December 1999, p. 2.

18. ibid., p. 2.

19. M. Morfitt, 'Strengthening the Capacities of Local Government: Policies and Constraints', in C. MacAndrews, ed., Central Government and Local Development in Indonesia (Singapore: Oxford University Press, 1986), p. 59.

20. Devas, op. cit., p. 355.

21. A. Booth, ed., Oil Boom and After: Indonesian Economic Policy and Performance in the Soeharto Era, Oxford University Press, Singapore 1992.

22. Law 22 was the initiative of the Minister for Regional Autonomy, Ryaas Rasyid, when he was Director General of the Department of Internal Affairs.

23. Hull. op. cit., p. 3.

24. The decentralisation is embodied in Article 7, (1) of Law 22. The economic policy areas include macro-development planning, state economic institutions, development of human and natural resources and high technology.

25. Indonesia now has twenty-six provinces with the loss of East Timor.

26. See the statement by the Indonesian Minister for National Education quoting research from Gajah Mada university concluding that only 5 out of 300 Kabupaten were prepared for the new autonomy status (Jakarta Post, 2 November 1999).

27. International Crisis Group Report, 'Indonesia's Crisis: Chronic But Not Acute', 31 May 2000.

28. It is estimated that application of the fiscal law will dramatically alter provincial economic relations and induce bankruptcies among the less well financially endowed regions. International Crisis Group Report, p. 19.

29. R. J. May, 'Ethnic Separatism in Southeast Asia', Pacific Viewpoint, vol.31, no. 2, 1990, p. 40.

30. ibid., p. 43.

31. Theys Eluay is Chairman of the presidium. Before the formula for revenue sharing was fixed, Papua had demanded a share of the overall revenue range of between 75-80 per cent. This roughly approximates the figure the regions will be allowed to keep of forestry, fishery and mining resources under proposed Law 25.

32. Louise Williams, 'Strangers In Their Own Land', The Age, 10 July, 1998.

33. ibid.

Indonesia's Future Prospects: Separatism, Decentralisation and the Survival of the Unitary State


34. International Crisis Group Report, op. cit., p.21.

35. 'West Papuans Declare Independence from Indonesia', The Jakarta Post, 5 June 2000. Papua is the name now used by the central Indonesian Government to refer to the area previously referred to by the Indonesian Government as Irian Jaya. Some Papuans refer to the territory as West Papua.

36. Lindsay Murdoch, 'Military Threat to Curb Self Rule Move', Sydney Morning Herald, 6 June 2000.

37. 'Indonesia Promises Probe into Rights in Irian Jaya', The Sunday Canberra Times, 11 June 2000.

38. Donald K. Emmerson, 'Will Indonesia Survive?', Foreign Affairs, vol. 79, no. 3, May-June 2000, p. 101.

39. ibid., p. 105.

40. ibid., p. 98

41. R. J. May, 'Ethnic Separatism in Southeast Asia', Pacific Viewpoint, vol. 31, no. 2, 1990, p. 35.

42. Semangat Merdeka, 23 March 1949, quoted in Dua Windhu Kodam-I/Iskandar Muda, p. 154.

43. Aceh's domestic political situation at this time was complicated by a struggle between Islamic conservatives and reformists. In early 1946 extremist members of the All-Aceh Religious Scholars' Association, (PUSA) purged elements of the traditional aristocracy in Aceh.

44. International Crisis Group Report, op.cit., p. 20.

45. International Crisis Group Report, op.cit., p. 20.

46. Ed. Aspinall, 'Whither Aceh?', Inside Indonesia, no. 62, April-June 2000.

47. This agreement was intended as a symbolic recognition by the Indonesian Government of Tengku M. Hasan di Tiro's position, although it is understood implicitly by the Indonesian Government that he no longer has effective control over events in Aceh.

48. Anthony Reid has argued that Indonesia can survive Aceh becoming a state if it does not remain hostage to its military. See Anthony Reid, 'Which Way Aceh?', Far Eastern Economic Review, 16 March 2000, p. 36.

49. Peter Hartcher, 'West Papua Shaping as Howard's Next East Timor', Australian Financial Review, 10 June 2000. The argument is taken to extraordinary lengths by some who feel that Australia wishes to see the fracturing of the archipelago as a way of limiting Jakarta's future power in Southeast Asia.

50. Robert Garran, 'W Papuans to Stay Put: Canberra', The Australian, 31 May 2000.

51. ibid.

52. Kim Beazley, 'Australia and Indonesia: Neighbours in Geography, Neighbours in Democracy' Address to the Australia-Indonesia Business Council, Jakarta, 2 May 2000, p. 8.