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The Suharto Regime
The coup was swiftly thwarted by army forces under General Suharto, who gradually assumed power (although retaining Sukarno as symbolic leader). Thousands of alleged Communists were executed; people everywhere took the law into their own hands and a widespread massacre ensued (Oct.–Dec., 1965). As many as 750,000 people may have been killed, including many ethnic Chinese; in E and central Java and in Bali entire villages were wiped out.
The new government steadily increased its power, aided by massive student demonstrations against Sukarno. General Suharto brought an end (1966) to hostilities against Malaysia, banned the PKI, reestablished close ties with the United States, and reentered (1966) the United Nations. Indonesia became one of the founding countries of the Association of Southeast Asian Nations (ASEAN) in 1967. On Mar. 12, 1967, the national assembly voted Sukarno out of power altogether and named General Suharto acting president.
Suharto was elected president in 1968, and reelected in 1973, 1978, 1983, 1988, 1993, and 1998. His government reinstated an earlier Dutch colonial policy of "transmigration," in which farmers from the overpopulated islands of Java and Bali were moved to underpopulated areas such as Kalimantan, Sumatra, and Papua. The policy has had mixed results; though more than six million had moved by the 1990s, Java and Bali continue to be heavily populated. The economy began to grow rapidly in the 1970s, due mainly to expanded oil, gas, and timber exports; in the 1980s and 90s manufacturing for export became important.
In 1975–76, Indonesia annexed East Timor (a former Portuguese colony), and incorporated it as a province of the country; the takeover was not recognized by the United Nations. Following the annexation, separatists in the largely Roman Catholic province resisted Indonesian control, suffering substantial loss of life. Indonesia came under increasing criticism from the United States and international organizations for human-rights abuses in the area.
During Suharto's regime, his family held sway over much of Indonesia's economic life, and government corruption increased. While the economic conditions of many Indonesians improved, opposition to his policies continued to be suppressed. In Oct., 1997, the country was plunged into economic upheaval when its currency plummeted. The stock market followed soon after, and the International Monetary Fund (IMF) agreed to provide the country with a $40 billion aid package in exchange for economic reforms. Struggling under a huge foreign debt and Suharto's reluctance to implement the IMF reforms, Indonesia's economy continued to worsen in 1998. Student protests and riots over rising prices broke out across the country, with increasing demands for Suharto to resign. Suharto stepped down in May, 1998, and his vice president, B. J. Habibie, assumed the presidency, pledging reform, clean government, and economic responsibility. In June, the government reached an agreement with foreign bankers on the rescheduling of nearly $80 billion in debt.
Early in 1999, Indonesia and Portugal reached an agreement permitting the people of East Timor to choose between limited autonomy within Indonesia and independence in a referendum. Fighting in East Timor between government security forces and anti-independence militias on one side and separatist guerrillas on the other increased in mid-1999 as the vote approached. In August, voters chose independence, but the territory descended into chaos as pro-Indonesian militias and the army engaged in a campaign of terror and brutality, killing proindependence Timorese and causing thousands to flee their homes. In Sept., 1999, after intense international pressure, President Habibie asked the United Nations to send a peacekeeping force to the area, and in October the United Nations agreed to take full control of East Timor until independence, which was achieved in 2002. Even as the situation in East Timor quieted down, however, calls for independence rose in other provinces, particularly Aceh, in N Sumatra, and Papua.
Meanwhile, in the June, 1999, parliamentary elections, the Indonesian Democratic party of Struggle of Megawati Sukarnoputri, the daughter of Sukarno, came in first with 34% of the vote; President Habibie's Golkar party came in second, with 22%. In the Oct., 1999, presidential elections, Abdurrahman Wahid, of the National Awakening party, became the country's first democratically elected president after Megawati failed to build the coalition needed to win; she was chosen by parliament as vice president. A Muslim theologian and religious leader, as well as a defender of human rights and religious tolerance, Wahid moved to increase civilian control over the military, which lost influence and prestige following Suharto's fall and the East Timor debacle. He also was forced to deal with often vociferous opposition in parliament. The economy began to revive in 2000, although the currency (rupiah) suffered a sharp loss in value.
In Feb., 2001, the parliament censured the president, who was implicated in two corruption scandals. Wahid, who had alienated Megawati and suffered a drop in popularity, was censured again in April. Although he was subsequently cleared of wrongdoing in the scandals, the parliament voted in July to remove him from office. Megawati succeeded Wahid as president. Subsequently the parliament passed laws granting limited autonomy (including substantial control over natural resources) to Aceh and Papua, in the hope of undercutting local secessionist movements, but violence in both provinces has continued. An agreement was signed with the Aceh rebels in Dec., 2002, raising hopes for peace that were dashed six months later when Indonesia ended what it regarded as fruitless talks and resumed military action.
Relations were strained with Malaysia in 2002 when as many as 400,000 Indonesians were forcibly deported under a tough new anti-illegal-immigrant law. Constitutional amendments passed in the same year called for the direct election of the president and the elimination of the seats reserved for the military in the national legislature. Both amendments will take effect in 2004. In Oct., 2002, a terrorist bombing at a night club in Bali that was frequented by foreigners killed more than 200 people. The bombing was apparently by Indonesian Islamic radicals linked to Al Qaeda. Despite economic improvement since Megawati became president, corruption remains a major problem, having worsened significantly since Suharto's fall. A proposal in 2003 to split Papua into three provinces sparked new unrest there.
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