Essay on Indonesia Post-Suharto

ranked ninth with a score of 82 out of 100 on the “Corruption Perceptions Index

The following is the list of core corrupt acts, classified by the United Nations Office on Drugs and Crime: bribery, embezzlement, theft, fraud, extortion, nepotism, favoritism, and clientelism. However, it is important to note that this is not an exhaustive list. Progressive development could enlarge this list to include other acts in the future. Since, bribery is frequently found and seen as “popular” among white-collar employees, like higher government officials, I am going to address to this kind of a corruption.

After Suharto ended his long dictatorial reign in 1998 there was a substantial increase in religious and ethnic conflict in Indonesia. Author Jacques Bertrand claims religious and ethnic conflict defined Indonesia’s national model. This resulted in three critical junctures during Suharto’s retirement of his sovereign rule. The three critical junctures defined Indonesia’s “terms of citizenship, and give meaning to the structure and procedures of an institution” (Bertrand, 20). When Suharto left as dictator, major political and social changes consumed Indonesia, which threatened the Indonesian realm. The people of Indonesia struggled to define their sense of nationalism.

Political leadership in East Timor however has been an obstacle in the process of achieving actual sustainable growth. Many leaders date to the period of Indonesian occupation and their leadership styles reflect this. One example is the leadership style of its former Prime Minister Gusmao. Gusmao was chiefly accused of leading neo-patrimonially as a product of the resistance era mentality. Part of these accusations come from his tendency to award contracts and consistently make purchasing decisions without consulting the actual members of his cabinet. When advisors were consulted, they were frequently other members of resistance groups dating back to Indonesian occupation. East Timor’s own laws are written to prevent such events, but the mentality of guerilla leadership has lead to the idea officials can act unilaterally without a dialogue. Gusmao was replaced in 2015, but this makes up the majority of the young nation’s lifespan. Gusmao continues to hold office as the minister of Finance, and several other major government positions are occupied by other resistance leaders. Corruption is not an uncommon occurrence in developing nations, but

Gus Dur’s cabinet decided to raise fossil fuel prices by more than 9 percent in October 2000, and it resulted in large-scale public protests (Beaton& Lontoh 2010). It was a risky attempt, because the people of Indonesia had just passed through a devastating political transition period from the Soeharto era, as well as dealing with the adverse effects of the Asian monetary crisis during 1997-98. During this period street riots became a medium for the people to express their disagreement toward certain policies. People were frustrated, and interest groups took advantage of this phenomenon for their own political interests.

Every year, Transparency International publishes a Global Corruption Index analyzing each country’s projected corruption predicated on the scope of bribery, illegitimate government expenditures and absence of anti-corruption regulations . For the last few decades, some countries have been continuously occupying the end of the list together. By the end of last year, the top three most corrupted countries were Afghanistan, Somalia and North Korea. Almost all of Afghanistan’s widespread corruption is connected to misuse of aid money that was provided to the country by international entities. The Afghan government in 2012 promised to put efforts to diminish the problem, however because of the fact that public officials are the largest beneficiaries from corruption, there is not much of significant improvements has been made towards corruption reduction . Somalia has experienced similar issues as well. One of the World Bank reports showed that within the matter of 2 years, the aid money that Somalia received which is around $130 million . Furthermore, Somalia’s private companies have been reportedly paying certain fees to the government officials in exchange of

“The problem of corruption was most acute in the civil administration, but 2014 also saw a "formidable scale of political corruption," the study found.

Corruption is a set of unethical and dishonest practices that are done with the intention of self-enrichment usually at societal expense.Alege,Adamu and Muhammad (2014) defined corruption as efforts to secure wealth or power through illegal means for private gain at public expense or as a misuse of public power for private benefit.The World Bank (1997) defines corruption as the abuse of public office for private gain.Corruption therefore mainly involves those public figures regardless of whether they have authority or not.Corruption comes in different ways including bribery,extortion,emblezzement,tender selling etc.Research has shown that it is difficult to accurately measure the levels of corruption a country has.It has been shown that countries with high levels of corruption experience a negative correlation between corruption and economic growth as compared to those countries with relatively low levels of corruption. The World Bank describes corruption as ‘‘the single greatest obstacle to economic and social development. It undermines development by distorting the rule of law and weakening the institutional foundation on which economic growth depends’’. This paper therefore will mainly focus in administrative corruption in the public sector. The corruption index (CPI) published by Transparency International is used to rank countries according to the level and prevalence of corruption and the said country. . According to research from various authors including Mauro (1995)

Mauro (1995) conducted a research based on a cross-country data to evaluate causes of corruption worldwide. In “Corruption and Growth”, he describes the relationship between corruption and economic growth of different countries over the period 1971-1979 and 1980-1983. In his research, Mauro used indices related to corruption from Business International Corporation which sells indices to banks, companies, and investors. The indices are based on the responses of the BI’s analysts from more than 70 countries, and they reflect analysts’ perspective on conditions in a country. The indices have values between 1 and 10, and higher values correspond to a better quality of institutions. Mauro has used nine indices, which, in his opinion, are the best determinants of institutional efficiency: political change (a change in institutional framework due to elections), political stability (disintegration of political activities), probability of opposition group takeover (probability of the opposition to gain power), stability of labor (possibility of labor disruption), relationship with neighboring countries, terrorism, legal system (efficiency of labor environment), red tape (bureaucracy), corruption. Mauro separated those nine indices into two groups based on how closely the indices are correlated. The first group is labeled as bureaucratic efficiency and includes variables such as legal system, red tape, and corruption. The second group of variables is labeled as political stability and

Transparency International’s Corruption Perceptions Index has ranked Kyrgyzstan 150th out of the 177 countries. World Banks Worldwide Governance Indicators

Corruption is a complex political, social, and economic anomaly that negatively affects developing and developed countries. It weakens democratic institutions, holds economic development, widening the rich-poor gap and certainly leads to governmental instability. The World Bank definition of corruption states that “…the abuse of public office for private gain”.

From being ruled by an authoritative government, Indonesia now has become a model for democracy in Asia. Over the years, Indonesia has slowly made the transition to democracy. Its new presidential election is clear evidence of this transition because the Indonesians chose to elect a common man to be the president: an official who they thought would understand their struggles. Within 15 years, Indonesia has transitioned from a bureaucratic-authoritarian regime to a formal presidentialism. The newly elected president has already taken steps toward implementing his reforms which consists of pushing to cut down fuel subsidies, getting rid of corruption and encouraging new businesses to invest in Indonesia by giving them tax incentives. These are clear signs that consolidated liberal democracy in Indonesia has already taken place and that Indonesia will continue to be a democratic country in the future.

Indonesia is a country in Southeast Asia that was under a military dictatorship for 32 years. The dictatorship era started after the failure of communist coup d’état by Indonesia’s Communist Party in 1966. General Suharto, the one who had the biggest role in failing the coup d’état, ousted the first president and established an autocratic anti-communist regime known as the New Order, which attracted political and economic support from Western governments during the Cold War. At the beginning of this era, he said he would practice a kind of semi-direct democracy, while later, even the news in newspapers was controlled by the government. His era was ended in 1998 by a huge student revolution and riots

This paper is critically assess the settlement of the laws related to the corruption. Corruption at this context simply means misuse of public office for private gain.

2.2 Limitation to grand corruption One of the most famous typologies of corruption analysed in anti-corruption research is that of grand18 and petty corruption, although no international or national legal instruments provides expressly for this distinction. Thus, there is no legal definition for the term „grand corruption‟, with the effect that the concept and its prerequisites remain controversial.19 2.2.1 Qualitative element: powerful high-level authority Originally,20 the level of authority where corruption takes place has exclusively determined the distinction between grand and petty corruption. Whilst grand corruption takes place at the policy formulation end of politics, thus at the highest levels of political authority, petty corruption, also labelled as bureaucratic or administrative corruption, occurs in the public administration, at the implementation end of politics. For instance, payments to mid- and low-level government officials, such as police or immigration officers, demanding bribes constitute petty corruption. Beyond controversy, high-level authorities encompass prominent figures such as heads of States, heads of governments and ministers. However, the precise scope of high-level authority remains subject to debate.21 2.2.2 Quantitative element: large-scale corruption Increasingly, authors focus also on quantitative aspects to draw a line between grand and petty corruption.22 Typically, grand corruption is committed on a large scale and involves 18 The term „grand corruption‟ was first used by Moody-Stuart in The Good Business Guide to Bribery (TI 1994). He defined it as „the misuse of public power by heads of State, ministers, and top officials for private pecuniary profit.‟; Jayawickrama N „Corruption - A Violation of Human Rights?‟ available at http://resources.transparency.bg/download.html?id=219 (accessed 26 October 2013). 19 On the differentiation between grand and petty corruption, see Mashali B „Analyzing the relationship between perceived grand corruption and petty corruption in developing countries: case study of Iran‟ (2012) 78 International Review of Administrative Sciences 777 et seq. 20 Moody-Stuart (note 18) based his concept merely on the hierarchy of the perpetrator