From: Charles Scheiner <cscheiner>
/* Written 4:46 PM Jul 8, 1994 by newsdesk in igc:ips.english */
/* ---------- "INDONESIA: Habibie, in the Eye of t" ---------- */
Copyright 1994 InterPress Service, all rights reserved.
Worldwide distribution via the APC networks.
*** 05-Jul-94 ***
Title: INDONESIA: Habibie, in the Eye of the Storm
An Inter Press Service Feature
By Rajiv Chandra
BANDUNG, Indonesia, Jul 5 (IPS) - Inside a huge hangar in this
industrial city in central Java is a mock-up of the new N-250
aircraft, a sophisticated commuter turboprop touted by its Indonesian
makers as the hottest item in the country's aviation technology.
The aircraft plant is pivotal to an ambitious plan by Research and
Technology Minister B.J. Habibie to catapult Indonesia from Third
World poverty to a high-tech future.
A close friend of President Suharto, Habibie has shot into
prominence as the priest of high-tech and a powerful commander in the
murky world of Indonesian politics.
But critics say Habibie is intoxicated with his dreams of
technological success and his ambitions are too expensive for a
developing economy, starving the more crucial sectors of investment
and skilled workers.
Still, he has enjoyed increasing influence as the high-tech
minister, head of an Islamic revivalist group, behind-the-scenes
political player and a foil to the country's powerful military.
Last month, Habibie became the centre of controversy when the
Indonesian government shut down three prominent magazines, sparking
protests against what many considered a hard blow to press freedom
and openness in the country.
The media crackdown, apparently on the orders of Suharto, was
triggered by reports of dissent within the government over the
purchase of 39 former East German navy ships and accounts of
involvement of Suharto cronies in a banking scandal.
Habibie had long earned the wrath of the military by intervening
in all major military purchases and sidetracking lucrative
commissions that had once gone to the army generals.
By arranging the purchases of the German ships and approving a
1.1-billion-dollar refitting bill, Habibie has set himself at odds
with the military chiefs and their political allies who said the
entire deal could have been done for less.
Habibie's increasing profile has thrust him into the heart of a
debate over whether a civilian or military figure will succeed the
73-year-old Suharto, himself a former general, when he steps down.
The minister's friendship with Suharto dates back to his childhood
when, as a 12-year-old in his native Sulawesi, he met the future
president, then an army officer.
He later received a doctorate in engineering in Germany and stayed
there for 18 years as a research scientist at the aircraft producer,
Messerschmitt.
In 1992, Habibie became the head of the Association of Muslim
Intellectuals which was created with government backing to capitalise
on the rising Islamic consciousness in Indonesia and secure Suharto
the support of conservative Islamic leaders.
''Habibie is using the Muslim masses for his own political ends,''
commented an Indonesian political analyst who asked not to be
identified.
The minister has also become something of a kingmaker and the
chief focus of military opposition within the ruling Golkar party.
In recent years, Habibie has managed to catapult a number of
proteges into leadership positions in the party and the government,
creating a civilian challenge to military dominance.
''The military would like to have more money to buy arms, and
Suharto -- with Habibie's help -- has said no,'' says a senior
diplomat in Jakarta. ''The military has not liked Suharto's efforts
to push them back to the barracks.''
Western and Indonesian economists also question how long Habibie's
ship and aircraft industries will be allowed to bleed state finances.
Although the government maintains that the Industri Pesawat
Terbang Nusantra (IPTN) which manufactures the N-250 aircraft makes a
small profit, a Western economist said the operation is ''losing
money disastrously''.
According to independent estimates, subsidies received by
industries controlled by Habibie amount to as much as two billion
dollars annually.
Last year, the World Bank, one of Jakarta's biggest donors and a
strong advocate of Indonesia's economic liberalisation and rapid
growth, challenged the government support for high-tech industries
and Habibie's policy of ''technological leapfrogging'' so that
Indonesia can catch up with more developed countries.
Some of the Habibie-sponsored industries, such as the IPTN's
aircraft unit in Bandung, still rely on foreign experts at vital
production areas despite their professed claims of self-sufficiency.
''They may not need as many foreign people, but they will still
need foreign experts at key posts to check the engineering,'' says a
U.S. aircraft engineer who now works in Indonesia.
(END/IPS/RC/LNH/94)
Origin: Manila/INDONESIA/
----
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