Indonesia, enabling them to steadily distance themselves from bureaucratic patrons, extend their autonomy, and perhaps to rise to a more overtly dominant position within the ruling alli-
ance. By showing how the conglomerates dealt with the unravelling of the New Order and its
centralised network of patronage, this thesis will demonstrate that the Chinese tycoons man- aged to reorganise in post-Soeharto Indonesia, and that their interests and actions have paved
the way for a more plutocratic regime. The study will thus highlight an important case in which big business adjusts to new political conditions, as has happened before in other post-
authoritarian environments.
1.3 Methodology
This study provides a sociological analysis of the relations between the state and capital in post-Soeharto Indonesia, focussing on the intangible, unquantifiable question of power. More
specifically, this study scrutinises the political economy of those who hold power in Indone- sia. This is per se
a tricky task, as research on the rich and powerful in general has to deal with the problem of inaccessibility. In most cases, these people form an exclusive club that
makes participant observation or other in-depth scrutiny rather difficult, if the researcher her- himself does not belong to this class.
In the specific context of Indonesia, there are additional problems in studying capital be- cause of the Chinese predominance in the capitalist sector. As in the case of most societies
where entrepreneurial activities are undertaken as a family business, there is a tendency for ethnic Chinese in business to function like a closed society, making it difficult to have access
to them for research purposes, as Diao Tan 2001: 141 observed. Another, probably more important reason for this reluctance may be found in the particular political conditions for
Chinese capital during the New Order, where it was generally forbidden to talk about race, re- ligion, ethnic groups, and class the so-called SARA-taboo; see van Dijk 1994. To address
Chineseness was even more sensitive, as anti-Sinicism and anti-government feelings increas- ingly overlapped during the evolution of the New Order, turning criticism against the con-
glomerates into a powerful political tool against the state elite. Therefore only a little, filtered information on Chinese businesses reached the public, while at the same time most of the
Chinese tycoons kept a very low profile. Public relations efforts were unknown, and indeed not needed. The authoritarian, protectionist regime made it possible to do without them. An-
other reason for the shortage of facts and figures is the rather late development of private cor- porations in Indonesia, which only became significant through the economic policies at the
outset of the New Order in the late 1960s. Hence, the establishment of a stock exchange, usu- ally the major source of information of this kind, came in late as well. Useful data on this ba-
sis is only available for the last decade of the New Order. As Sato 1994: 102 pointed out, this led to a scarcity of research interest in private capital in Indonesia.
The new political situation has not brought significant changes in this regard. Most Chi- nese businessmen still shy away from publicity, if not because of state policies or political
sensitivity, then because of a general aversion to reveal strategies to others. The struggle for survival and the settlement of their debts with the Indonesian Banking Restructuring Agency
IBRA constituted a further reason not to disclose the actual property situation and the modi- fied structure of a business group. The end of authoritarianism has put the conglomerates at
the centre of attention of journalists and politicians alike, which increased the secretiveness of the actors.
10
On the other hand, the relative openness of post-Soeharto Indonesia provided new sources of information that balanced the lack of data for the New Order. These could be
10
No ranking has been published since 1997. My own attempts to compile data for an updated list failed, due to a situation still very much in flux, the lack of suitable sources, and endeavours of busi-
ness groups to hide their actual size and constitution. With this I share the same experience as econo- mists e.g. M. Chatib Basri, Universitas Indonesia, interview 12 May 2004, journalists e.g. Eddy Su-
prapto, KontanAliansi Jurnalis Independen, interview 8 September 2004, or even specifically ap- pointed government watchdogs e.g. Raden Pardede, Vice President Director of State-owned Asset
Management Company PPA, interview 20 October 2004, who sought to, but were not yet able to pro- vide a detailed overview of the situation of big business during the post-Soeharto time.
used to supplement the insights of the few seminal works on capital before 1998, most impor- tantly Robison’s 1986 and Shin’s 1989 studies on ‘the rise of capital’ and ‘capitalists-in-
formation’ respectively. Established business magazines such as SWA, Eksekutif, Warta Eko- nomi,
or Kontan, and the political magazines Tempo or Gatra, as well as the international press e.g. Far Eastern Economic Review re-opened several closed cases of the past and fo-
cussed – together with the many Indonesian newspapers such as Jakarta Post, Bisnis Indone- sia,
or Kompas – their gaze on Chinese big business of the present. In addition to this, infor- mation found in compilations of Data Consult 1998 or in business reports, company files,
annual reports, and statistics provided further material to consider, although such data was subject to the same constraints and biases as mentioned before and, more often than not,
lacked explanatory power as well as sufficient reliability. These sources had to be verified through direct observation as well as through that of oth-
ers, which were best disclosed in talks with ordinary Indonesians, in commentaries, speeches, articles, and statements of activists, critics, journalists, politicians, and experts. I
conducted interviews with seven politicians among them former President Abdurrahman Wahid and former Minister of Finance Bambang Subiyanto, seven journalists, and 21
economists or other academics see Appendices. In order to concretise the abstract concept of ‘capital’, I further sought to meet the persons who represent capital, i.e. the capitalists. Due
to greater accessibility, I first focussed on the ones who work for Chinese big business at the highest managerial level. I interviewed 12 business persons, of whom nine were high ranking
executives or board members of the conglomerates or one of their companies, among them the President Directors of Indomobil and Lippo Investments, the Managing Director of Sam-
poerna, President Commisioners of Bank Central Asia and Bank Artha Graha, and Commis- sioners of Lippo Group, Lippo Bank, Bank Internasional Indonesia, and Bank Artha Graha.
In addition, I intended to meet the bosses of the top groups in Indonesia, even though ac- cess was a serious problem.
11
The interviews that I eventually conducted with some of the most important capitalists in Indonesia today – Anthony Salim Salim Group, Tomy Winata
Artha Graha Group, Eddie Lembong Pharos Group, also Chair of the Chinese Indonesian Association INTI, and Sofjan Wanandi Gemala Group, also Chair of the Indonesian Em-
ployers Association APINDO – delivered a wealth of information that I would not have found elsewhere and helped to verify or repudiate hypotheses and substantiate my interpreta-
tions. Altogether, I conducted 62 semi-structured interviews with 51 persons. However, the
challenge was to put this kind of information together with the other bits and pieces, to evalu- ate and analyse them and combine my own assessments with the reflections and judgements
of these and other observers.
1.4 Outline
