Nov 19, 2008

Battle lines drawn for Indonesian polls
By Tom McCawley 

JAKARTA - Two old rivals are already jostling in Indonesia's biggest political 
battle, the presidential elections which take place every five years, with the 
next scheduled for September 2009. Incumbent President Susilo Bambang Yudhoyono 
has vowed to re-contest the seat he won from his former boss, Megawati 
Sukarnoputri. Next year, she will have a chance to win it back. 

A flurry of polls in recent months has sketched a likely showdown between the 
two in an election likely to echo the themes of 2004's historic vote, when 
Indonesians directly elected their president for the first time in the 
country's 59-year post-colonial history. 

Yudhoyono, 59, a reformist former army general, has since had to face the 
agonizing complexities of running the world's third-largest democracy. In stump 
speeches in villages, cities and TV interviews, he vowed on the 2004 hustings 
to create jobs, spark economic growth and crack down on endemic graft. In part, 
he has delivered as promised. 

But as international oil prices spiked earlier this year, he was forced to cut 
subsidies and hike energy prices several times, causing grassroot voters to 
feel economic pain. "Tell the president the earthquake hurts," said one 
Yogyakarta night stall owner in the aftermath of the massive 2006 earthquake 
that claimed thousands of lives, "but inflation and fuel price hikes hurt 

Megawati, 61, chairwoman of parliament's second-largest party, the PDI-P, has 
had four years to ponder the lessons of her last electoral defeat. Other old 
faces from 2004 promise to make an appearance, including two former generals 
closely linked to former strongman president Suharto, but they are unlikely to 
pose a serious challenge to the two front-runners. 

Indonesia has a confusing, multi-stage election process. In April 2009, voters 
will choose candidates for the regional and national parliaments from national 
parties. Months later, they will vote for a president and a second-round 
election will follow if no candidate wins 50% of the vote. The myriad parties 
and candidates makes for a dazzling, complex web of horse-trading and political 
intrigue. In 2004, the vote went to a second round, with Yudhoyono winning 
60.9% over Megawati's 39.1%. 

New rules set in October will further complicate the process. Parliament 
introduced a 25% threshold of the popular vote, or 20% of parliament's seats 
for a party or coalition of parties to nominate a presidential candidate. 
Yudhoyono is thus likely to need an alliance with another major party, as his 
Democrat party only scored 8% in the 2004 elections. Yudhoyono confirmed in 
September that he would stand for re-election and coyly said it was "likely" 
incumbent Vice President Josef Kalla, chairman of the powerful Golkar party, 
would be his running mate. 

Indonesia's still nascent science of polling puts Yudhoyono and Kalla as the 
likely frontrunners for the 2009 election. Polls have consistently showed the 
two creeping back from second place in mid-year, after the government hiked 
fuel prices, to a narrow lead in November. A survey by one think-tank, the 
Indonesian Research and Development Institute (IRDI), released in November, 
concluded that only Yudhoyono and Megawati had a realistic chance of winning 
the election. The IRDI survey listed Yudhoyono as the most popular, with 33% of 
2,000 respondents in 33 provinces backing him. The poll listed Megawati's 
popularity at 17.9%. 

Yudhoyono's Democrat Party is also gaining voters, according to another poll 
from the respected Indonesian Survey Institute (LSI). The poll showed the 
party's approval rating had risen to 16.8%, just outpacing parliament's two 
largest parties, Golkar with 21.5% and the PDI-P with 20%. The LSI poll said 
Yudhoyono's personal popularity, which rose to 62% in October-November from 45% 
in June, helped boost his party's image. 

LSI director Saiful Mudjani was quoted as saying the rise was mostly due to the 
Democrat party's image as graft-free, led by Yudhoyono's clean image. His 
government has also overseen a major anti-graft campaign which has netted and 
jailed several high-level government officials on corruption-related charges. 

Inflated expectations
There were exceptionally high hopes for the US-educated Yudhoyono after his 
landslide victory in 2004. With two ministerial portfolios under his belt in 
previous administrations and a US master's degree, he was the best-qualified 
president on paper since Bacaruddin Jusuf Habibie in 1998. He has since raised 
Indonesia's profile abroad, overseeing a restoration of military ties with the 
US in 2005 after 14 years of restrictions. Under Yudhoyono, too, Indonesia has 
had a stronger global diplomatic presence, taking a seat on the United Nations 
Security Council and winning over powerful allies in Washington and the Middle 

But governing has proved harder than campaigning. Rival parties in October 2004 
circulated insulting text messages calling Yudhoyono a "chicken vegetable", 
which translated loosely into criticism that he was weak and indecisive. 
Yudhoyono's fledgling Democrat party only won 8% of the popular vote, 
propelling him into a sometimes uneasy alliance with the military-linked Golkar 
and several other parties. 

Since then, bickering between parliament's 11 parties has often delayed 
lawmaking, disrupting bills ranging from the recent anti-pornography law to a 
long controversial mining bill, which was first tabled in 2001. Meanwhile, the 
outlying regions have pushed for more autonomy and control over local 
resources, straining relations with Jakarta. 

Yet policy matters outside of Yudhoyono's control, namely the steady rise of 
international oil prices, which peaked at US$147 in mid-July, have had the 
biggest impact on his administration's vacillating popularity. Even strongman 
Suharto, who maintained an authoritarian grip on power during his 32-year rule, 
was reluctant to cut subsidies on fuel and power. 

Yet when oil prices began rising to record levels, Yudhoyono had little choice 
but to reluctantly approve a series of price rises, which started in 2005 and 
culminated in May this year. Public opinion polls this year showed a direct 
link between domestic inflation rates and Yudhoyono's public approval ratings. 
Some analysts believe that the recent depreciation of the rupiah, which has 
lost 20% against the US dollar since September, will lead to a new surge in 
imported inflation in 2009. 

Yudhoyono and Kalla (if he accepts the nomination) won't be short of economic 
ammunition going into the campaign season. In line with the global economy, 
Indonesia's economic growth is forecast to fall in 2009, but only slightly, 
dropping from about 6.1% this year to around 5%. The two leaders are also 
expected to campaign on their high-profile successes, including bringing peace 
to Aceh province in 2005 and apprehending dozens of Islamist terrorists whose 
activities had undermined confidence in the economy. An aggressive anti-graft 
campaign has netted dozens of high-profile officials and even former cabinet 

A major test for Megawati will be whether she can cash in on Yudhoyono's 
failings. Economic growth of 5% will not be enough to create enough new jobs 
for new labor market entrants. Her party has a massive local reach throughout 
Indonesia's 17,000 islands, provinces and regencies, where there is still much 
resentment towards Jakarta. And Megawati's pedigree as daughter of Indonesia's 
founding president Sukarno is still a drawcard, particularly in central Java. 

Yet critics claim she still maintains a sense that the presidency should be 
hers by birthright and that she has not shaken her famous aloofness. That could 
complicate her ability to form alliances, while Yudhoyono's presumed Golkar 
link will bolster his partnering power. The LSI poll listed former military 
chief Wiranto as the third most popular candidate with a 5% approval rating. 
Wiranto, 61, ran a polished campaign in 2004, employing foreign election 
consultants and a slick media barrage. A former aide of president Suharto, he 
won 26.2 million votes in the first round of the 2004 elections, or some 15% of 
the vote. Aides in his new Hanura party say they are confident of winning 15% 
of the legislative votes this time as well. 

Another Suharto-era general, former special forces commander Prabowo Subianto, 
features in polls as the fourth- or fifth-most popular candidate with a 4.7% 
approval rating. Prabowo, 57, has had to fight off smears to his reputation due 
to allegations of human-rights abuses during his command. Yet the presidential 
aspirant has used advertising effectively, according to the LSI survey, with 
his Gerindra party enjoying a large national power base among market traders 
and farmers. 

Yet much will depend on the economic mood of market traders, farmers and 
others. Indonesia's currency, the rupiah, was hovering at seven-year lows of 
around 11,800 to the dollar this week. The weakness reflects both investors' 
nervousness over the global and US financial crises and a local scramble for 
dollars to pay off debts. The value of Indonesia's commodity exports has also 
taken a hammering, driving down foreign exchange earnings. 

Both trends are expected to drive up inflation in the year ahead. The major 
concern for Yudhoyono, who has a PhD in rural economics from the Bogor 
Agricultural Institute, will be creating jobs and curbing inflation, tasks 
which will be complicated by an emerging global economic downturn. 

Tom McCawley is a Jakarta-based freelance journalist. 

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