Indonesia: Democracy, Economic Development and the Media By Amir - - PDF document

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Indonesia: Democracy, Economic Development and the Media

By Amir Effendi Siregar1 Indonesia has, for the first time in its history, had three Presidents in the space of three years -- BJ Habibie until 1999, Abdurrahman Wahid until 2001 and Megawati Sukarnoputri since July 2001. These developments illustrate the turbulence of Indonesian political life, which has had its impact on the Indonesian economy, and vice versa. The economic crisis in 1997 led to a political crisis, forcing the six-term President Suharto to step down in May 1998, to be replaced by Habibie. Political instability prolonged the economic crisis. Today, Indonesia is in the initial stages of a new phase of democratic

• statehood. The challenge is to establish and maintain political stability, which will

hopefully lead to economic security and a better investment climate that can help the country recover from the economic crisis. During the economic crisis, the gap between the have and have not, the number of poor people in Indonesia increased tremendously. Today, there is some respite from this situation, but most economic indicators show that the Indonesian economy still faces great difficulties with regard to foreign debt, unemployment, budget deficit, etc. At the same time, there is also a shortage of credible information. Freedom of information was denied to the people during the 30 years of authoritarianism, from 1965 to 1998, and this legacy has not entirely been discarded. Indonesia is attempting to establish a democratic information, media and communication system. Indonesia is trying to fight poverty not just in the economic sense but also in the field of information and communication. Political and Economic Challenges Indonesia is a country of about 210 million people, 6000 inhabited islands, 300 different ethnic groups and 25 different languages, of which Bahasa Indonesia is the national language. The population lives mostly in five major islands: Sumatra, Java, Kalimantan, Sulawesi and Irian Jaya. As a result of decades of centralized development

1 Amir Effendi Siregar is General Secretary of the Indonesian Newspaper Publishers Association. He has

an academic background in mass communication, which he has taught at the university level in Indonesia. He has also served as Editor-in-Chief of the Warta Ekonomi Magazine.

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policies and the nature of the political system, the majority of Indonesians, about 60%, live in Java, which is the smallest of the five major islands, containing a mere 9% of the country’ s total land area. Jakarta, the capital, is the centre of economic and political life in Indonesia. More than 60 per cent of the money in the country is circulated here and close to two-thirds of the readers of print media publications are to be found in this city

• f only 9 million people. This unequal development of Java, compared to the rest of

Indonesia, existed in the early years of the republic, but in the last three decades, this has

• sharpened. There are also sharp differences between Jakarta and other parts of Java.

From independence in 1950 to the mid-60s, Indonesia faced many political conflicts and suffered poor and disrupted economic growth. The political and economic system moved from “right” to “left” and back again, like a pendulum. The era of liberal democracy from 1950 to 1959 witnessed political instability and challenges to the Centre from political and religious movements in West Java, Aceh in North Sumatra, West and Central Sumatra. From 1959-1966, the Sukarno-led era of “guided democracy”, during which President Sukarno assumed all executive powers, was also turbulent, in terms of both internal and external conflicts, and economic hardship. It ended with a coup and a bloodbath in 1966. By then, the Indonesian economy had been destroyed with inflation running at about 330% annually. Under Suharto, the focus was on political stability and economic development rather than on ideology and mass mobilization, but the political system continued to be authoritarian and government was centralized. The agricultural sector was prioritized, to solve the country’ s food problems, and the BIMAS (Mass Guidance) programme was launched to develop intensive agricultural extension services providing important inputs such as seeds, fertilizer, insecticides and credit to peasants and farmers. Food production, especially rice production, increased tremendously, and in 1985 Indonesia achieved self- sufficiency in rice production. In general, from 1966 to 1997, the economy grew faster, with an average annual GDP growth rate of 6 to 7 %. Life expectancy, which was 41 years in 1960, increased to 54 years in 1981, and to 67 (female) and 63 (male) in 1997. But there was no significant change in land distribution and ownership. As the population increased, the number of landless citizens also increased. While rich farmers generated bigger surpluses as a result

• f the green revolution, the number of people living below the poverty line was still
• considerable. According to Statistic Central Body (BPS), in 1996, about 22.5 million

people lived below the poverty line. Moreover, Indonesia, during this era, came to be classified as one of the most corrupt countries in the world. During the financial crisis of 1997, the rupiah fell from Rp. 2,500 to the US dollar in early 1997 to Rp. 15,000 in early 1998. Big business and banks were in deep trouble, as was the government, which could not deal with the financial crisis, followed by the economic crisis. This led to political change, and in 1999, a general election was conducted on democratic principles. Under the new president, Abdurrahman Wahid, Indonesian political life remained unstable, and full economic recovery did not take place. Eventually he came to be replaced by Megawati Sukarnoputri.

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To be fair, Wahid and his then vice-president, Megawati, did attempt to stabilize the economy. Compared to 1998 -- food shortages, contraction of the economy by 13.4%, and 70% inflation – the Indonesian economy saw low inflation and about zero growth in

• 1999. In 2000, the budget deficit was 3.8%, as compared to an estimated 4.8%, inflation

under control at 9.3%. In the first quarter of 2001, the Indonesian economy grew 4%, which was higher than the growth estimated for other Asian countries such as Malaysia, South Korea, Thailand and the Philippines. In the same quarter, inflation was 2.6% and foreign exchange reserves stood at US$ 28.7 billion, large enough to cover seven months

• f imports. The currency also became stronger, and today, it is about Rp.10,000 to 1

US$. However, even though the Indonesian economy shows signs of recovery in terms

• f macro-indicators, the country still faces a huge problem of poverty. According to the

World Bank, the annual GNP per capita almost halved from US$ 1110 in 1997 to US$ 580 in 1999. In terms of the national poverty line, the number of poor increased greatly as a result of the crisis. According to BPS-Statistic Indonesia, using a 1996 standard of Rp.38, 246 monthly in urban areas, and Rp. 27, 413 in rural areas, the number of people living below the poverty line in 1996 was 22.5 million people. By the same standard, in 1998, the number of people living below the poverty line had increased to 34.5 million. However, by the revised December 1998 standard, which was Rp 96,959 for urban areas and Rp. 72,780 for rural areas, the number of people living below the poverty line was 49.5 million. If we measure poverty using an international standard of US$ 2 per day per capita, the situation is grimmer. In 1999, 15.2 per cent of the population earned less than US$ 1 per day per capita and 66.2 per cent earned less than US $2 per day per capita. By this reckoning, the number of poor people could be as high as 120 million. Challenges for the Media In a market economy, there is a reciprocal relationship between economic development and the development of the media. With greater economic development, the role of the media grows. The media, too, can s timulate the capacity of a society to improve its economic situation, and to progress. But there are certain safeguards that need to be in place. In a state-controlled economy or centrally-planned economy, the media is centrally controlled, and in the hands of a few. This is also the case in an

• rthodox free-market economy, which has a tendency towards monopoly ownership of

the media, and thus, a control over the content of the media. That is why we need a democratic media set-up with a diversity of ownership and a diversity of content, in order to increase wealth, and to progress in a way that benefits society as a whole. In this regard, there must be a balance between the roles of the public, private and community media. The Indonesian press The Indonesian press is today dominated by the private sector, and is the most elite-oriented media in the country, compared to TV or Radio, because it serves the free

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• market. Its survival depends on the buying power of the people. By UNESCO standards

(one print medium for 10 people), there are too few copies of newspapers in circulation. According to Indonesia’ s Information Department, total circulation of all newspapers stood at 4.8 million in 1999. According to World Bank estimates for 2000-2001, it stands at 5 million today. Also according to Information Department, the circulation of all magazines is about 4.1 million copies and the weekly tabloids is about 6.9 million copies. The total print media circulation in 1999 ( i.e. dailies, weeklies, monthlies) is about 15.8 million copies for 206 million people.. By comparison, in any developed country, the total circulation of the print media is likely to exceed the size of the population. What makes it worse, however, is uneven distribution. As mentioned earlier, 60% of print media circulation is confined to Jakarta, where only 9 million people live, and another 20 % to Java. The remaining 20 per cent is scattered over other the islands, especially in big cities and urban areas. After the fall of Suharto, there were no restrictions to stop any institution or company from publishing a newspaper or other kind of journal. As a result, the number

• f publications licensed by and registered with the Indonesian Information Ministry

jumped from 282 in 1997 to 1675 by the end of 1999. According to Indonesian Press Council, the number of publications increase again became 2033 in 2001. Significantly, 50 per cent of these are located in Jakarta and about 70% in the whole of Java. By end-1999, in response to pressure from many NGOs and professional media

• rganizations, Parliament enacted a new law guaranteeing freedom of the press. There

are no censors and no special political license is needed to run a newspaper. However, according to the Indonesian Newspaper Publisher’ s Association, by June 2000, the number of publications which was still active and in the market had decreased dramatically to 487 and it was about 601 in 2001 according to Indonesian Press Council. For that matter, even the circulation of respected national media publications has dropped between 25 to 50 per cent, according to AC Nielsen, a research company. In short, the total circulation of Indonesian printed media today, estimated by the Indonesian Newspapers Publishers Association, is about the same as it was before restrictions were lifted. Why is this so? As I have indicated earlier, in terms of content, the print media, for commercial reasons, mostly aims to please educated and elite readers, especially those living in urban areas. Secondly, according to the BPS-Indonesia Statistik, the population aged 15 years and above, educated to senior high school level, and holding a job, is only 19 million. If we assume that majority of print media purchasers are from this group of citizens, their number is limited, relative to the population. Thirdly, people lack the reading habit and finally, many journalists and media managers lack professionalism. In order for print media to reach people, including large numbers of the people and the poor, in small cities and rural areas, this country needs local or community print media to provide information to people and help them improve their capacity to lift themselves out of economic and poverty problems. For this task, we cannot depend only

• n private or commercial institutions, but need support from non- profit and public

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• institutions. These institutions must work professionally and manage content in a way

that reflects the social dynamics and the needs of the community. The process of communication should be bottom-up. Fortunately, this country is in the process of implementing decentralization based on a new democratic law which empowers local people and gives them economic and political powers, and it may therefore be possible to realize these goals for the media. It is very clear that there is reciprocal and interdependent relationship between the economic development and the development of the media. We can be optimistic that there is a lot opportunity for local and community media to grow with the new democratic autonomy and decentralization law in Indonesia. Television: Private, state-owned and public Since 1989, the private sector has been allowed into this field, earlier monopolized by the state sector. Licenses were given to private companies for setting up TV stations. Unfortunately, these licenses were given only to Suharto’ s family or to

• thers close to the regime.

Currently, the country has one state-owned television station called Televisi Republik Indonesia (TVRI) and six private television stations: Rajawali Citra Televisi Indonesia (RCTI), Surya Citra Televisi (SCTV), Televisi Pendidikan Indonesia (TPI), Cakrawala Andalas Televisi (ANTeVe), Indosiar Visual Mandiri (INDOSIAR) and Media Televisi Indonesia (METRO TV). The last of these is a newcomer and was established in the year 2000. Metro is the only TV channel that mainly broadcasts news programmes and is therefore called the CNN of Indonesia, but it broadcasts mainly in

• Jakarta. Early in the year 2002, four more private television stations begin operating and

are officially launched in April 2002, namely:Televisi Transformasi Indonesia (Trans TV), Duta Visual Nusantara (DTV or TV 7), Pasaraya Mediakarya (La TV), Global Informasi Bermutu (Global TV). All of them are national channels, and are expected to make the media environment a highly competitive one. For private TV stations, the combined coverage area, in geographical terms, is 78.7% of the country, according to the journal Media Scene. Total potential viewership and access to television is approximately 67.2 % of the population. Access in urban areas is 80% and in rural area it is 60%. Each private TV station has potential viewers and access to television ranging from 26.6% to 44.9% of the population. However, in 1998, according to the World Bank, TV sets in Indonesia were about 28 million for 207 million. Moreover, the content of these programmes is designed for the urban elite. Entertainment is the dominant form of content, except in the case of Metro TV, which mainly serves the capital. The state-owned TVRI, introduced in 1962, covers an area as large as the entire United States. With the help of satellite communications, it reaches the entire population, but there need to be more TV sets in the country for everybody to actually see its

• programmes. There are 30 relay stations throughout Indonesia, which have been linked

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by satellite, and TV studios in nine big cities of the country. Some provincial capitals have mobile mini-studios to produce regional and local programmes. But today, this state-owned TV station is finding it hard to maintain its equipment, which is obsolete or

• damaged. For very longtime, since 1970s, TVRI was not allowed to generate revenue

through advertising and depends on the government budget , and contributions from

• wners of TV sets,which were not sufficient to cover its expenses. Since June 2000,

TVRI becomes State-owned company which are allowed to get advertisement, but it has a lot of internal management problem which need to be solved in order to make this station efficient, productive and professional. Parliament is deliberating a new broadcasting law, which if enacted, will enable TVRI to function as a public television station instead of a government television station. This is not an easy task. This TV station has, over decades, become a propaganda station for the government, with top-down and one-way communication. In the last decade, after the entry on the scene of private television stations, it is losing its audience, especially in urban areas. In these areas, people prefer to watch private television stations. But TVRI still has many viewers in rural areas, especially among those who have no access to private television station. If TVRI were to successfully transform itself into a public television station, making programmes autonomously and encouraging bottom-up communication processes, it would emerge as a reliable media for reaching the majority

• f the people especially the poor and helping the country to improve economic situation

and eradicate poverty. Radio and its possibilities Radio broadcasts more extensively, with greater local coverage, and reaches more people than TV. There are about 32.2 million radio sets in the country. In 2000, there were estimated to be 964 radio stations, including 50 state-owned radio stations belonging to Radio Republik Indonesia.(RRI). The RRI was established on September 11, 1945 and is headquartered in Jakarta and is well networked throughout the archipelago. Non- commercial radio stations number 133 and privately-owned commercial radio stations number 773. The coverage area of radio stations is about 85% of the country. As in the case of TV, most people in urban areas prefer private radio, but rural areas are covered better by RRI. Like TVRI, RRI is also being transformed into a public broadcasting unit from an instrument of propaganda for the government. This provides non-governmental organizations and civil society as a whole with an opportunity to work together closely with RRI and help it function as a public broadcasting station. Today, there is no regulation of broadcasting activities. The broadcasting law issued in 1997 was authoritarian and repressive. This law explicitly stated that broadcasting units had to be licensed by Departemen Penerangan-- the word penerangan has no exact translation, but is akin to propaganda, information and enlightenment, particularly the last. This department was later abolished by the Wahid government. The new government has instead established the State Ministry of Communication and Information (Kantor Menteri Negara Komunikasi dan Informasi) but this ministry

• perates only at the level of policy. It has no executive role.

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As I have mentioned, a new broadcasting law is still being deliberated in

• Parliament. Many civil society organizations are involved in proposing, lobbying and

working with Parliament to ensure that the law is democratic, as they had done in the case of the new press law. In a democratic country, an independent authority is needed to regulate broadcasting activities, based on the principle of diversity of ownership and the diversity of content for the maximum benefit of the people. This new law should create an independent regulatory body, as well as community, public and commercial broadcasting institutions, which can guarantee those diversities – of ownership and content. The New Media In addition to conventional media, there is also online media. This media is based

• n the internet. It is highly elitist at present because it needs computers and telephones.

Fixed line telephones in Indonesia are about 6 million, the number of personal computers is about 2 million and it is expected to increase to 4.5 million in 2005. According to the Association of Indonesian Internet Service Companies (Asosiasi Penyelenggara Jasa Internet Indonesia), in the year 2001, there are only about 2 million users and 500.000 internet subscribers, double the number of such subscribers in 1999. But these numbers are likely to grow faster as the technological devices become cheaper after a very short

• time. This what we call deflation phenomenon. The number of computers may come to

rival the number of TV sets which are about 28 million. Also, even when available to

• nly a few, online media can be very effective. It was used intensively by student leaders

to organize themselves during the toppling of Suharto’ s regime in 1998. This medium can also be used to improve the marketing and management capacity of small and medium scale enterprises, which predominantly support the Indonesian economy today. Last but not least, almost all Indonesian respected print media has online version beside the Indonesian news portal. This also an opportunity for the local and community, either print or electronic media to go national and global, to attract attention, to have mutual benefits and interact with national and global community. This is really a short cut to progress, socially, politically and economically. With the new technology, the world has changed and history has been accelerated. As I mentioned earlier, in order to stimulate the economy and generate greater capacity at local levels, the country has passed a new law to provide democratic autonomy at local levels. This law bases local autonomy on three pillars:

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Power-sharing, which means that local government authorities share the responsibility for governing and managing their regions.

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A greater share of government revenues for local government and local people.

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Empowering the local administration to act for the benefit of the community. In line with this new law, information technology can be used to established local information centres, which can network with other parts of the country. At present, there are 32 provinces and about 300 regencies in Indonesia. It is difficult to get data and information from some places, especially in remote areas, not only because of

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communication problems, but also due to the lack of well-managed and accurate

• information. Imagine how different it would be if there were 300 local information

centres, 32 provincial information centers and one national information centre, all hooked up together. They would provide invaluable support to economic development.

Conclusion

Indonesia is now moving away from a centralized and authoritarian system to a decentralized and d emocratic political and economic system. At the same time, it faces huge economic problems and unequal distribution of, and access to information. Indonesia is in the process of establishing a democratic information, media and communication system, which h as a great potential for developing economy and helping to address poverty. We cannot just rely on private or commercial media to play this role, since they are governed by commercial interests. We also need community media and public media. There must be a balanced division of roles among public, private and community media. This principle should be applied to all media: printed and electronic media, conventional and new media. Indonesian mass media, especially the print media, in term of sirculation, is f ar behind compare to other countries. With the new technology and in line with the new democratic autonomy and decentralization law. there is an opportunity for all media, especially for local and community media to interact with national and global community in order to get mutual benefits to foster economic development at the local level and remote areas and as a result the role and the number of the media hopefully will grow well References: BPS-Statistic Indonesia (1999), Statistical Year Book of Indonesia, Jakarta, Indonesia. Coordinating Minister of Economy of the Republic of Indonesia(2001), Signs of Sustained Recovery, The Office of the Coordinating Ministry of Economy, Jakarta. Feith,Herbert,(1963), The Decline of Constitutional Democracy in Indonesia, Cornell University Press, Ithaca, New York. Geertz,Clifford(1963), Agricultural Involution, University of California Press, California. Goeltom,Miranda S.,(2000), Indonesian Economy on the Road to Recovery, Paper presented at the Strategic Intelligence Conference, held in Jakarta, August 29.

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Liddle,William R,(1984), “Suharto’ s Indonesia: Personal Rule and Political Institutions”, Pacific Affairs. Papanek,Gustav.F.,(1980), The Indonesian Economy, Praegar Publisher, New York. Persatuan Perusahaan Periklanan Indonesia (Indonesian Association of Advertising Agencies)(2001), Media Scene, Jakarta Indonesia. Siregar, Amir Effendi (1999), Ekonomi Pasar dan Intervensi Negara (Market Economy and State Invervention), Suara Pembaruan Newspaper, January 15,

• Jakarta. Indonesia.

Siregar,Amir Effendi (2000), Demokratisasi Frekuensi dan Penyiaran (Democratization of Frequency and Broadcasting),Kompas Newspaper, October 24, Jakarta, Indonesia. Siregar, Amir Effendi (2001), Demokratisasi Komunikasi dan Informasi (Democratization of Information and Communication), Kompas Nespaper, August 25, Jakarta, Indonesia. Siregar, Amir Effendi (2000), Demokratisasi dan Ekonomi Pasar (Democratization and Market Economy), Warta Global Indonesia, Jakarta, Indonesia. SPS Media,(2000), Oplag Anjlok, Pembacapun Rontok (Sirculation Down Fall), Indonesian Newspaper Publisher’s Association (SPS), Jakarta, Indonesia No.02. Warta Ekonomi (2001), Hary, Bimantara dan Tudingan Monopoli Informasi, (Hary, Bimantara and Information Monopoly Accusation), Number 45, November 12, 2001. The World Bank (2001), World Development Report, Oxford University Press, New York.