BY NAOMI CRAINE AND PATRICK BROWN
CHRISTCHURCH, New Zealand - On June 15, the Indonesian currency plummeted to 14,700 rupiahs to the dollar. This was down from less than 11,000 two weeks ago, and more than 80 percent below the level of July 1997, when the economic crisis in Asia exploded.

The same day, Indonesian business associations in the coffee, footwear, and textile industries announced that exports this year would fall far below their earlier projections. The government also announced it was freezing operations of the Indonesian Tourism Promotion Representative offices in seven countries due to "financial constraints." Indonesian government officials are still urging the International Monetary Fund (IMF), which represents the biggest U.S., Japanese, and other imperialist banks, to free up the rest of a loan package drawn up last October.

Of the $43 billion "bailout," only $3 billion has been delivered to date. A second payment of $3 billion was scheduled for June. This was delayed after former President Suharto's attempts to impose IMF-dictated price increases accelerated widespread protests, which had been growing since the beginning of the year. By then, judging that Suharto was not capable of ramming such measures through without risking even deeper rebellions, Washington and its capitalist allies in Indonesia, including key elements among the military officers, pushed Suharto into resigning.

Since Suharto's May 21 resignation, the country has been marked by political ferment, including actions directed at local authorities and the national government, actions by peasants, protests by supporters of the East Timorese independence struggle, and a number of strikes.

In the city of Surabaya, in eastern Java, thousands of workers at the Maspion Group, a manufacturer of household appliances, ended a strike after winning pay raises. Workers also wrested from the company a one-hour prayer break on Fridays for Muslim workers, who form the big majority.

Strikers at a shoe factory in Jakarta also won a wage increase. Other issues are still in dispute, such as the workers' demand that the plant manager and personnel manager - both of whom are police officers -be replaced.

The Indonesian daily Kompas reported June 16 on a protest by peasants whose land had been taken for a golf course nearly a decade ago. They planted cassava and bananas on greens and carved the words "Reform," "People's Land," and "We Are Taking What Is Ours" into one of the fairways.

The Indonesian Observer noted that, as in "many land disputes during the later years of former president Soeharto's 32-year rule, the farmers [had in 1989] received paltry compensation for land they had worked for generations.... [receiving] Rp 30 (0.2 cent) per square meter, or US$634, for the 31 hectares they had worked since 1961."

The defense minister and army chief, General Wiranto, expressed the concern of Indonesia's rulers and their imperialist overlords about the continued political unrest. In early June Wiranto "warned" that the "commotion of political activity, the various statements and demonstrations - if they are allowed to continue - can disrupt stability."

For the moment, the various "security forces" that are so visible in the country are generally playing a relatively low-key role. However, police used batons in dissolving protests in Jakarta by East Timorese independence supporters, and stated they planned to question demonstrators.

Deep recession in Japan
The economic crisis that is sweeping Asia and the Pacific took a sharp turn for the worse in June. Along with the rupiah, currencies across the region dropped sharply against the U.S. dollar in mid-June. The Japanese yen fell to an eight-year low of 146 to the dollar, the Philippine peso dropped 5.7 percent to 42.6 to the dollar, and the Australian dollar hit US$0.58.

In this country, the New Zealand dollar traded at 49 U.S. cents, falling below 50 U.S. cents for the first time since 1987. Less than two years ago the New Zealand dollar was trading at 71 cents.

Japan has officially entered its deepest recession in more than 50 years. The Gross Domestic Product contracted 0.7 percent in the 1997 fiscal year, which ended in March. The unemployment rate rose to a record high of 4.1 percent in April, while industrial output dropped 1.6 percent that month. The net outflow of funds from Japan in stock and bond investments in April was $25.75 billion.

An IMF report issued in May cited the Japanese economy and the situation in Indonesia as the two most pressing questions in the region for the imperialist lending agency. An Asia Pulse news story read June 14, "The report called on Japan to implement permanent tax cuts, while broadening its tax base by reducing tax thresholds and cutting government spending." In clearer terms, this means cutting taxes for big companies while raising them for workers and farmers and cutting social programs.

The May riots
Meanwhile, the Indonesian military have announced they will conduct an investigation of riots that took place in Jakarta and other cities in mid-May. Signs of the considerable damage caused by fires and stones during these events can be seen in many parts of Jakarta. Further riots in several towns on Java were reported on June 17, following demonstrations that demanded lower prices and protested government corruption.

Indonesia's newspapers frequently carry reports of "outside forces" that purportedly instigated much of the rioting in May. Some anti-Suharto activists have assigned a key role in the events to military provocateurs or criminal elements.

From the discussions that Militant reporters were involved in, including with a security guard in a riot-torn market in Jakarta, it is apparent that angry crowds gathered spontaneously on hearing the news of the slaying of four student protesters by the military at Trisakti University May 12. The ferocity of some of the actions that followed reflect the immense social tensions building in this country, beset by economic crisis and massive inequality of wealth. Enterprises associated with the Suharto family and at least one cop station were attacked and burned down in the rioting that some were involved in. So too were luxurious shopping malls, hated symbols of affluence.

But the principal victims of the rioting were the stores and homes of small shopkeepers who are of Chinese origin. Chinese traders have long been targeted as scapegoats by the regime - including during the military coup and bloodletting of 1965-66 that brought Suharto to prominence. Long-standing policies have closed off many avenues of employment for people of Chinese descent. Chinese face systematic discrimination in government employment and the armed services, which together constitute a huge part of the economy. Discrimination extends to language as well. One indication of this was a statement by H.M. Arub, the speaker of the provincial legislature in South Sumatra. According to the June 9 Jakarta Post, Arub called on Indonesians of Chinese descent to use either Bahasa Indonesia or the predominant ethnic language in the area for everyday use, not Chinese.  
 
 
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