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May 16, 2009 Hard graft for Indonesia By Katherine Demopoulos JAKARTA - Indonesia's presidential hopefuls must announce their intention to run for election in July by this Saturday, and only incumbent Susilo Bambang Yudhoyono has made the fight against corruption a cornerstone of his political agenda. This month's arrest of the Corruption Eradication Commission's (KPK) chairman in a murder enquiry raises questions about how much has really improved during Yudhoyono's tenure and whether he can maintain the political will to fight graft in the months ahead. In his bid for re-election, Yudhoyono has returned to the anti-corruption theme, a catalyst for his success in the 2004 presidential polls and, analysts say, a reason behind his party's significantly stronger showing at the legislative elections in April, where it garnered over 20% of the vote, up from around 7% in 2004. The KPK's work in prosecuting a number of former high-ranking officials, including former central bank governor Burhanuddin Abdullah and Yudhoyono's own in-law Aulia Pohon, has challenged Indonesia's culture of unaccountability. Meanwhile, the reformist drive of Finance Minister Sri Mulyani Indrawati, particularly in cleaning up the notoriously corrupt tax and customs offices, has helped to improve Indonesia's corruption perception index, which was up to 2.6 in 2008 from 2.3 in 2007, according to corruption watchdog Transparency International. But the charges laid against KPK chairman Antasari Azhar, coming amid rumors of a love triangle gone wrong involving a female caddy, threaten to damage the KPK's reputation. They have sparked a backlash against the semi-autonomous organization from anti-reform elements in the legislature. The high-profile arrest, which has dominated national headlines, has generated mixed reactions. "The Antasari case of course shocked us and also the public ... To be in that position someone should be clean from any kind of criminal act. A prosecutor of corruption should be a person of integrity," said Danang Widoyoko, coordinator of Indonesia Corruption Watch (ICW), an independent anti-graft watchdog. Kevin Evans, former head of anti-corruption at the Aceh-Nias Rehabilitation and Reconstruction Agency, said that the KPK's work had in the main been positive since it was established in 2003. He noted in particular the KPK's handling last year of the case against public prosecutor Urip Tri Gunawan and prominent businesswoman Arthalyta Suryani, both of whom received jail sentences on bribery related charges for a case involving Bank Indonesia. Evans believes that by quickly expelling Antasari the KPK passed another important integrity test with "flying colors". However, he contends that the Antasari case also points to the need for reform to the KPK's selection process, which is currently controlled by the House of Representatives through its selection of the agency's top officials from a short list of candidates put forward by the president's office. "Maybe it's time for a little introspection for the parliament ... take a step further upstream as to why these people get in place," said Evans. "[Antasari's] name was on there [the list from the president's office] to begin with, so it's not appropriate to simply blame the parliament . As long as people don't ask questions about upstream, then the situation continues." There were already criticisms of the KPK's work, including allegations of a political bias in certain prosecutions. ICW's Widoyoko said the KPK has stalled in pursuing certain high-profile investigations, including its failure to pursue certain high-profile politician suspects. He points to the case involving opposition politician Agus Condro, a former legislator for the Indonesian Democratic Party of Struggle (PDI-P) who admitted to receiving 500 million rupiah (US$48,000) to influence the selection process in which Miranda Goeltom was in 2004 named Bank Indonesia senior deputy governor. Condro blew the whistle on others who received cash, but neither he nor they have yet to be formally investigated, according to Widoyoko. Legislative challenge Haryono Umar, the KPK's vice chairman, said Antasari's alleged crimes are a personal matter and have not undermined the KPK's integrity. "There's no link with the work of the KPK as an institution," he deflects. But there could be legal repercussions for the organization as parliament - its members targeted last year in several corruption investigations - raises constitutional questions about whether the KPK can continue its work without a chairman. Umar said the issue had been resolved and the KPK "can carry on as before". But growing resistance to the KPK's probes and charges among legislators is also apparent in the current debates about renewing the mandate and changing the structure of the KPK's special court, which is now weighing various corruption cases. That could include a move to water down the court's current five-judge panel to comprise three regular judges and two ad hoc judges. Whether that would take significant steam out of Yudhoyono's broad anti-corruption drive is still in question. Apart from pursuing wayward public officials, his government is also working to implement greater transparency requirements for the crucial oil, gas and mining industries, in a bid to boost foreign investment. The nation's implementation of the Extractive Industries Transparency Initiative (EITI), now in the drafting and aimed at boosting foreign investment in the sectors, will if passed eventually require all domestic operators to publish what they pay. According to Erry Riyana Hardjapamekas, a former KPK chairman who supervised the early stages of the EITI's drafting process, Nigeria earned US$9 billion in new energy investments and was able to borrow foreign funds at lower interest rates after it implemented the EITI. "In other words, the trust of foreign lenders in government improved," he said. The lack of transparency has proven a habit hard to break in Indonesia. M Husen, assistant deputy minister for oil in the coordinating Ministry for Economic Affairs and a leading technical expert behind the nation's bid for EITI compliance, said some government officials are loathe to accept the need for greater transparency and accountability. "This is a new thing to us," he said, adding that accepting even the importance of disclosing "not too deep" information has met resistance. Husen said EITI will only cover the largest producers in the first reporting period, which will cover 2009 accounts, before expanding to smaller players. Nor will the EITI immediately tackle corruption at the regional government level, which worsened significantly in resource-rich areas following the implementation of decentralization measures, which gave more authority over resources to local-level administrators. For instance, one local mining company which asked not to be named reported that after it refused to pay a local official $15 million, several months later it was declined permission to build a new barging jetty. Meanwhile, Karen Agustiawan, the new head of state energy giant Pertamina, said her anti-corruption goals far exceed those outlined by the EITI, including the publication of a round figure by year's end for the total amount lost in corruption at the notoriously graft-ridden enterprise. As former KPK chairman Erry Riyana said, "Preventing corruption and encouraging transparency is like a long journey. Let's say a 1,000 mile journey. With what we've done and this EITI, at least we have passed our first 50 miles. That's not enough, so we need another 10 or 15 years, if we are lucky another 10 years." He may get at least another five years if, as expected, Yudhoyono is re-elected to the presidency in July. Although the KPK is now under fire for a candidate first advanced by the president's office, few here question Yudhoyono's reform credentials and most expect him to stay the graft-busting course in a second term. It's a popular perception few other top candidates share and one Yudhoyono will clearly bid to leverage into votes on the campaign trail in the months ahead. Katherine Demopoulos is a journalist based in Jakarta, Indonesia. She works as a freelance reporter for the BBC and Guardian, and also writes extensively on Asian energy markets. (Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing [Non-text portions of this message have been removed]
