James Balowski, Jakarta
Swimming against a tide of opposition, on March 1 the government of President Susilo Bambang Yudhoyono announced that it will raise fuel prices by an average of 29%.
Fuel subsidy cuts have been mooted since the Yudhoyono administration took office last year, despite the political sensitivity of the issue.
It was President Suharto's 1998 increase in fuel prices, by between 25% and 77%, that sparked the huge protests that led to his downfall in May that year, after more than three decades in office.
While the most direct beneficiaries of cheap fuel are middle- and upper-class car owners and the black economy, fuel price increases invariably flow on to basic goods and services. Straight after the increases, public transport fares were increased and many items at local shops and markets in Jakarta are already going up in price.
In an attempt to limit the social and political cost of the increases, Yudhoyono is not increasing the price of kerosene, which is used by the poor for cooking. Only the prices of petrol, diesel and premium gasoline are to be increased.
The government claims that the savings generated by cutting fuel subsidies will be used to provide free education, free health care and inexpensive rice for the poor. The government says it will channel around 10 trillion rupiah into social programs for the poor.
The Indonesian constitution guarantees all citizens nine years of free education and free health care for the poor. Many believe the extra compensation will just be siphoned off by bureaucratic mismanagement and corruption.
The increases come at the behest of international financial institutions such as the World Bank and the International Monetary Fund, and are more motivated by keeping these institutions happy than by a lack of alternatives.
More than 40% of government revenue is used to service interest payments on massive foreign debt, some 60 trillion rupiah is lost annually due to illegal logging supported and managed by high-ranking military officers in cahoots with government officials, the military's brutal war against the people of Aceh has cost 3 trillion rupiah since martial law was imposed in May 2003 and trillions are lost every year due to government mismanagement and corruption.
By February 28, there were demonstrations against the expected increases by hundreds of students from dozens of different groups in Jakarta who set fire to tires and pictures of Yudhoyono and blocked off roads. Other actions were held by public transport workers, non-government organisations, urban poor organisations, housewives and children. Convoys and long-marches through the city were organised, and an attempt was made to seal off the offices of the state-run oil company.
In the Central Java city of Yogyakarta, students burnt tires and rallied in the centre of the city while in the South Sulawesi provincial capital of Makassar, students from a number of universities called for a general strike and a public-transport strike left thousands of commuters stranded.
On March 1, hundreds demonstrated at the State Palace, demanding that the government locate embezzled assets instead of raising fuel prices. At a separate demonstration in Salemba, Central Jakarta, three activists from the United People's Alliance were arrested for burning photographs of Yudhoyono. In the South Sulawasi city of Kendari, students blocked roads.
On March 2, more than 3000 students gathered at the State Palace to protest, while other students took over the state radio station to broadcast their demands. Again in Makassar, thousands of students gathered at the local parliament while others hijacked fuel trucks, blocked roads with burning tires and sealed off petrol stations. Thousand of students also rallied in the in the West Java cities of Bandung and Cirebon. In Medan, North Sumatra, protesters called on residents to refuse to pay their taxes, electricity and water bills.
On March 3, a clash was reported between 300 students protesters and police in Cirebon with continued student demonstrations in Makassar and strikes in Kendari. Similar strikes were held by drivers in the Central Java city of Purwokerto Java and Kupang in East Nusa Tenggara. In the Riau capital of Pekanbaru students hijacked a diesel truck while in the West Sumatra city of Padang more than 100 public transport drivers went on strike.
It remains unclear how long public opposition of this kind will last, given the fragmented nature of the student movement and the lack of any real unity or political leadership among pro-democracy organisations. But is already becoming clear to an increasingly cynical and angry public that the Yudhoyono government will be pushing the same neoliberal polices that were pursued by former President Megawati Sukarnoputri, and led to her massive electoral defeat last year.
From Â鶹´«Ã½ Weekly, March 9, 2005.
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