International -- Asian Business: Indonesia
Is Aceh the Next East Timor? (int'l edition)
It wants independence from Indonesia and control of its vast gas fields. That may cause a brutal war
In a jungle clearing in the remote Indonesian province of Aceh, 22-year-old Husna is learning to march just like her father, a Free Aceh Movement guerrilla who taught her to shoot an AK-47 before he was captured and tortured by Indonesian troops nine years ago. Her ambition is to fall in battle just like two 19th-century Acehnese independence heroines, Cyut Nyak Dien and Cyut Meutia. "I'm not afraid to die as a martyr," she says. Then Husna joins her squad. As they march, they sing an old song: "The ocean, land, air, mountains and all its riches belong to Aceh."
That lyric, in a nutshell, sums up the vision of these guerrillas: Aceh, on the far northern tip of Sumatra, belongs to the Acehnese, not to Jakarta's bureaucrats on Java. What's more, the province's vast mineral wealth belongs to the Acehnese, too--and given a chance, they will use that wealth to finance a viable independent state. "The economic growth of Aceh would be fantastic," says Dayan Dawood, a U.S.-educated economist and rector of Syiah Kuala University in Banda Aceh, the provincial capital. The rebels want to tap the gas and oil wealth of their province, which has largely benefited the central government and producers such as Mobil Corp., and bankroll a model development program.
It's far from clear if the rebels are capable enough or honest enough to produce such a utopia. But it's certain that the fallout of a successful independence drive could be tremendous. Indonesia can ill afford the loss of the oil and gas revenues of Aceh and other breakaway provinces. And a brutal campaign of repression by the army is the last thing newly elected President Abdurrahman Wahid needs as he tries to woo back investors.
Yet to the rebels, a free Aceh is worth fighting and dying for, all under the command of the tough, Libyan-trained Abdullah Syafiie. And the fighting and dying may start soon. The rebels have given the Indonesian government a Dec. 4 deadline for signing off on a proposed referendum on independence in Aceh. If Jakarta refuses the demand, then Indonesia must expect all-out war, Syafiie says. Already, the rebels say they are deploying 170,000 recruits, along with 5,000 Libyan-trained guerrillas, in the villages where "the enemy will not recognize us, but we will recognize the enemy," says Abu Chaifah, deputy commander of the Pase region of eastern Aceh.OUTGUNNED. Brave talk, but the rebels face huge odds. Heirs to a 126-year struggle for independence, Aceh's guerrillas are outgunned, armed only with AK-47 assault rifles purchased second-hand in Cambodia and M-16 assault rifles looted from Indonesian army barracks. They are up against at least 36,000 well-equipped, uniformed Police Mobile Brigade and army troops who have been flowing into the province, choking the narrow two-lane highway from neighboring North Sumatra. Civilian officials of Wahid's government hope to avoid a bloodbath. "God willing we will be more restrained," Defense Minister Juwono Sudarsono recently told Parliament. Yet Indonesian generals have told diplomats that an offensive in Aceh could be more brutal than the mass murder and destruction that traumatized East Timor.
The administration of President Wahid sees Aceh as a test of its ability prevent Indonesia from balkanizing. "The biggest threats are disintegration and separatism," Commander-in-Chief Widodo told Parliament. The next province to go could be Irian Jaya, home to the lucrative mines of Freeport-McMoRan Copper & Gold Inc.
But Wahid also knows that a prolonged war could scare off investors. So he is playing for time, saying he will hold a referendum in seven months. He's dangling the promise of autonomy to the Acehnese and a bigger share of oil and gas revenues.
Wahid is also trying to play the Free Aceh Movement's factions against each other. Though one faction favors republican government and a market economy, an Islamic fundamentalist group favors a local Islamic regime. It already has started to negotiate with Jakarta over limited self-rule and has declared a truce. Neither group is able to win over the other completely. "The problem is that the Free Aceh Movement lacks a strong leader, and most people are not prepared for independence," says T. Iskandar Dawood, dean of the economics faculty at Syiah Kuala University. To woo the fundamentalists, Indonesia's Parliament has offered the Acehnese the right to set up Islamic courts, banks, and schools.HYBRID ECONOMY. Wahid may still have a shot at a negotiated solution. But the guerrillas who support an armed struggle don't trust Jakarta's promises. To them, separation from a distant central government would transform Aceh into a Brunei or a Kuwait. The rebels envision a hybrid economy where Islamic banks would work side by side with international banks, and clear, simple, investment rules would attract foreign capital. "The best economic system from my point of view is the global system," says Supreme Commander Syafiie.
Acehnese economists dream of a local government that gets its rightful share of oil and gas revenues from Mobil's vast natural gas fields and spends it on an ambitious development program. The rebels swear they could create growth of 10% to 12%, far better than the province's 2% contraction this year.
To reassure foreign investors and Western governments, the rebels have refrained from attacking Mobil's sprawling facilities, which it operates in conjunction with Pertamina, the national energy company. Mobil, in a written statement, claims strict neutrality in these matters and says it has had no contact with the rebels. But Syafiie says the rebels will not hold off forever. "Foreigners have taken a lot of wealth out of Aceh," he says, sitting under a tree in a village schoolyard. "If we have to fight our own struggle by ourselves, we cannot guarantee that their investments won't be damaged."
Whatever happens, reversing the damage already done to Aceh's economy will be difficult. Recent raids by Indonesian army troops and the distribution of anonymous leaflets warning all non-Acehnese to flee the province have forced many agribusinesses to shut down, says Dahlan Sulaiman, chairman of the Aceh Chamber of Commerce & Industry. Sulaiman's own businesses--a trucking company, a cement distributor, and a travel agency--are just barely profitable. "Any economic system would be better than what we have now," laments Sulaiman. With average income at $200 a year, one-third of Aceh's population lives below the poverty line.
The question is whether the Acehnese rebels could really produce anything better. Educated Acehnese doubt the rebels have enough trained professionals in their ranks to run a really effective government. And the temptation for the rebels to extract money from officials and businesses is already great. Guerrilla war, grinding poverty, curtailed investment: The tragedy of Aceh is far from over.By Michael Shari in Banda AcehReturn to top