3The ilmericatt u n..
15 JULI 1963
B R
D G E
BETWEEN
EAST
AND
WEST
Indonesia's Recovery and Progress
Part II: The Eight Year Plan
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PLUf?/gus of4UM
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In some circles of our readers the question often has been raised if Indonesia capaci
ties indeed improved since 1950. They point out that the Rupiah has been falling
continuously, and that there are no indications at all about improvement. Nov one
thing is certain: we are very inadequately informed. The press usually only prints the
sensational news about revolts, wars, earthquakes, disasters. Seldom or never do we
read about constructive works.
means or another. Some public employees
hold two jobs to supplement earnings. In any
country where government plays so vital a
role as it does in Indonesia, the temptations
for corruption are gerat. Corruption does
not appear to be serious enough to impede
appreciably the course of economic develop
ment, although in such an economy there is
an ever present danger that it may become
an acute problem in the future. Its main
impact at present is to sap the energy and
disfigure the image of a government that is
undertaking the serious task of development.
Efforts are being made by the government
to reduce corruption, however. In addition
to intensified anti-corruption activities on the
part of the public prosecutors, a Committee
on Government Operations, responsible only
to the President, has the power, when it
finds real evidence of corruption, to bring
pressure for corrective action on administra
tors at any level. Although the Committee
has no power to prosecute, it has substantial
influence and moral authority.
In summary, while there are many de
ficiencies in the way the economy and the
government operate, there is evidence of
and promise for further economic devel
opment. The restoration of internal secur
ity, largely completed in the summer of
1961, is a propitious sign. There is to be
sensed a new willingness on the part of
Indonesians to be self-critical and to ex
amine their own shortcomings. There is
an increasing tendency to seek pragmatic
rather than ideological solutions. Perhaps
one of the most favourable signs is the
presence of a growing number of well
trained personnel who show an awareness
of the magnitude of Indonesia's economic
problems and exhibit a desire for resolute
action.
Indonesia's capacity to absorb capital for
new projects is severely limited, mainly by
lack of adequate skilled personnelmanagers
and supervisors, technicians and skilled la
bour. To its credit, the Government recog
nises the need to improve technical and
managerial skills and is acting to remedy
them.
Skilled personnel is "glowing up like a
waringen" in Indonesia. Since 1950 more
than fifty universities were installed all over
Indonesia, with professors of several coun-
Now more news about Indonesia is avail
able (as a result of the re-established con
nections and Indonesia) we suddenly see pic
tures of big freeways, industries, office-build
ings, etc., etc. Also, when we look carefully
at he people in the streets, we see that they
seem to be well fed and clothed. All these
stories about starving and going naked must
be exaggerated. Furthermore there are letters
indeed from Indonesia about relations in
great difficulties, but there are also letters
from relatives doing quite well.
It is therefore always better to inquire
thoroughly and not to blabber too much on
insufficient informations or to dream about
a golden Indonesia. Like the Indonesians
self are doing: being pragmatic and earnest,
we must try to develop a clear insight in the
growth of a new Indonesia, to which country
many of us might return as an agent for an
American business or building company. Be
ing more or less an insider in the problems
of Indonesia will be of great advantage to us.
But therefore we must look back first.
The political decision to oust Dutch na
tionals in 1957 left Indonesia with a poorly
staffed agricultural and industrial adminis
tration. Indonesians could take over some
day-to-day operations but were poorly pre
pared to take over others. Rapid "Indones-
ianisation" after 1949 meant that on many
estates, former low-level supervisors or stu
dents fresh from agricultural schools sudden
ly had to be put in charge of operationsin
many manufacturing and trading companies,
junior clerks or army officers inexperienced
in these fields of activity became mangers
overnight. It is to their credit that the
economy did not grind to a standstill but
continued with only modest diminution of
output.
Wtih limited leadership provided by in
experienced and unstable ministries in Dja
karta in 1958, with uncertain poliices and in
effective administration increasing the diffi
culties in securing foreign exchange alloca
tions for raw materials and spare parts im
ports, and with the Rebellion unsettling the
government and the economics of the islands,
production suffered.
With the natioal income dropping enor
mously, the government bureaucracy got un
derpaid more and more, which accentuated
the need for supplementing incomesby one
tries. Thousands of Indonesian students
went abroad to study at universities in Amer
ica. England. Germany, France, as well as
in Tokio, New Delhi, Moscow, Peking and
other Asian countries. Furthermore, foreign
"specialists and advisors" in many industries
were instructors for labourers in many fields.
All this schooling provides a far better
instructed staff in the Indonesian economy
and state administration than ten years ago.
We may compare Indonesia with so many
Indo immigrants in America, who went to
school again, learned to handle new jobs and
came ahead rapidly.
No wonder the Humphrey Report is opti
mistic. And so is young Indonesia. As we
all know, there were political troubles of
Indonesia with Malaysia and the Philipines.
But now a treatise has been made between
these three countries, now forming a strong
political union with tremendous economic
possibilities in the triangle: East-Asia
Pacific Australia.
Let the pessimists and stupids chatter, but
you. reader, be wise. We have many years
ahead of us. In Indonesia as well as in the
relations between America and Indonesia
there are very good aspects for us! Keep
your eyes wide open.
And now about the Indonesian 8 Year
Plan. In general outline, the Plan is divided
into two separate parts. "A" projects, of
which there are 335 costing 240.000 million
Rupiah (plus 39 provisional additions), are
intended to contribute directly to national
economic development. "B" projects, classi
fied in eight major categories, are designed
to earn sufficient Rupiah and foreign ex
change to finance the "A" projects.
The distribution of "A" projects by cate
gory is as follows:
I n As
million percentage
Rupiah of total
Cultural 1,600 0.6
Educational 16,300 6.8
Research 2,600 1.1
Public welfare 6.200 2.6
Government3.600 1.5
Food 25.100 10.5
Clothing28.900 12.0
Industry52,000 21.7
Health 2.200 0.9
Transport
communications 60.200 25.1
Finance and tourism.. 1 1.300 4.7
Special project
(military) 30,000 12.5
Total 240,000 100.0
Of the 240,000 million Rupiah expendi
ture. 133.000 million are planned expendi
tures of Rupiah and 77,000 million (US
$1.700 million) are in foreign exchange.
continued page 2)
