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Economic crisis leads to scapegoating of ethnic Chinese

From Human Rights Watch, Asia Division
February 1998

The rise in prices of basic goods such as rice and cooking oil has led to violent protests across Indonesia, much of it aimed at the ethnic Chinese minority who dominate the retail economy. The rioting appears to have been largely spontaneous, but Human Rights Watch believes that senior government and military officials have fueled anti-Chinese sentiment through veiled references to "rats" and "traitors" and by their failure to explain that high prices and food shortages are not the fault of individual retailers. Human Rights Watch calls on the government to state explicitly that the ethnic Chinese are a valued and important part of Indonesian society and that violence against them and their property will not be tolerated. Denouncing communal violence in generic terms is not enough. The government should cease immediately the harassment of two prominent members of the ethnic Chinese community, Jusuf and Sofyan Wanandi. Finally, it needs to begin immediately a longer-term effort to end the discrimination against the ethnic Chinese in Indonesia that has existed since the late 1950s. In a commentary in the February 3, 1998 edition of the Asian Wall Street Journal, Indonesia expert Adam Schwarz suggested that President Soeharto take the lead by including an ethnic Chinese in his next cabinet. The government would do well to take that suggestion to heart.

Over the last two months, violence against ethnic Chinese has erupted across the country. After a series of outbreaks in Java, the unrest had by mid-February hit the islands of Sumatra, Sulawesi, Lombok, Sumbawa, and Flores as well. In most cases, the protests have been related to sharp increases in the prices of the so-called nine basic commodities (among them rice, wheat flour, cooking oil, sugar, soybeans, and eggs) as a result of the dramatic loss in value of the rupiah, the Indonesian currency. The targets of the violence have been Chinese-owned shops, homes, and businesses.

In none of the dozens of outbreaks of violence chronicled in this report (available on-line at: http://www.hrw.org/hrw/press98/feb/indo-al1.htm ) has there been evidence of direct government instigation of the rioters, and the government has been quick to send troops to disturbed areas and arrest alleged ringleaders. Nevertheless, some senior officials have appeared to endorse the anti- Chinese sentiment. Not only have they expressed no sympathy for the victims or made any effort to explain to the public the causes and consequences of the economic crisis, but in some cases, they have tried to deflect blame for the economic crisis onto prominent members of the ethnic Chinese community.

On January 14, for example, the commander of the armed forces in a press conference called on the owners of thirteen large conglomerates to bring their dollars back from abroad and convert them to rupiah. Nowhere was the word "Chinese" mentioned, but the appeal was an implicit accusation that wealthy Chinese were contributing to the currency crisis by selfishly keeping dollars stashed abroad at a time when the rupiah needed bolstering. In late January, Lt.Gen. Syarwan Hamid was reported to have made pointed references to the ethnic Chinese as "rats" who have no sense of patriotism and who at a time of crisis are salting away "the fruits of our national development." President Soeharto's son-in-law, Maj. Gen. Prabowo Subianto, then head of the army Special Forces (Kopassus) and since promoted to commander of the Strategic Reserve (Kostrad, the army's most elite unit), attended a much-publicized breaking of the Ramadan fast with Muslim leaders on January 23 during which he blamed the crisis on a political conspiracy, and others attending explicitly linked the conspirators to "the conglomerate group" and those with their "henchmen operating overseas." The two phrases were clear references to the ethnic Chinese, and Prabowo, instead of distancing himself from the remarks, tacitly endorsed them, urging a united front between the army and Islam. By warning over and over that the draconian anti-subversion law would be applied to hoarders of basic goods without at the same time explaining the difficulties that many shopkeepers are facing, the army has helped generate suspicions that any shop owner who refuses to sell at pre-crisis prices, or who closes his or her shop for fear of violence, is deliberately making goods scarce to keep prices high. The most obvious example of high-level attempts to focus the spotlight on the ethnic Chinese has been the army's targeting of prominent businessman Sofyan Wanandi, in an incident described more fully below.

Veiled and not-so-veiled attacks on the patriotism of the ethnic Chinese have a long history in Indonesia, going back to the Chinese role in the Dutch colonial period and to the 1960s and the army's suspicion that the ethnic Chinese as a group were a fifth column for the Chinese Communist Party. The attacks then were as unfair as they are now, but for reasons that will be explained below, they resonate strongly in Indonesian society, especially, though not exclusively, among more conservative Muslim groups. The Soeharto government has continued a policy of discrimination against the ethnic Chinese, restricting their admission to state universities and the civil service and maintaining a ban on the use of Chinese characters, while at the same time, leaving their dominance of the Indonesian economy intact and enabling a few dozen ethnic Chinese families to amass fabulous wealth. These policies have resulted in a public image of the ethnic Chinese as rich pariahs. The irony is that with the exception of the Wanandi brothers, the main victims of this round of unrest are not members of the estimated forty extremely wealthy families whose heads have earned the appellation cukong, or tycoon, but the shopkeepers who constitute a critical part of Indonesia's middle class.