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Bulletin of Indonesian Economic Studies
ISSN: 0007-4918 (Print) 1472-7234 (Online) Journal homepage: http://www.tandfonline.com/loi/cbie20
Book Reviews
Pierre van der Eng , Hall Hill , Patrick Walters , Andrew MacIntyre ,
Christopher Findlay , Robert Albon , Armida S. Alisjahbana & Ross H. McLeod
To cite this article:
Pierre van der Eng , Hall Hill , Patrick Walters , Andrew MacIntyre ,
Christopher Findlay , Robert Albon , Armida S. Alisjahbana & Ross H. McLeod
(2000) Book Reviews, Bulletin of Indonesian Economic Studies, 36:1, 243-260, DOI:
10.1080/00074910012331337853
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http://dx.doi.org/10.1080/00074910012331337853
Published online: 21 Aug 2006.
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BOOK REVIEWS
Anne Booth (1998), The Indonesian Economy in the Nineteenth and Twentieth Centuries: A History of Missed Opportunities, Macmillan, London, and St Martin’s Press, New York, pp. xvi + 377. Paper: US$ 19.95; cloth: US$ 79.95.
This book is the first monograph on Indonesia’s economic history since Burger’s Sociologisch-Economische Geschiedenis van Indonesië (originally published in Bahasa Indonesia in 1957) and the last edition of Gonggrijp’s
Schets ener Economische Geschiedenis van Indonesië (1957). It is also the first monograph since the revival of academic interest in Indonesia’s economic history in the 1970s. One of the stated aims of the book is therefore ‘to present a stocktaking of what has become a fast-growing field of study’ (p. xv).
It is also a very timely book, as Indonesia is poised to enter a new period of economic change. Professor Booth believes that the past can provide lessons for the present and the future. An important aim of her book is to answer the questions: ‘Why at the close of the twentieth century is the country still relatively poor and underdeveloped? What were the major policy errors of both colonial and post-colonial governments which have produced this state of affairs?’ (p. xv). Answers to these questions may help Indonesia to map a path for the future.
The book contains five thematic core chapters. Chapter 2 traces the broad outlines of economic growth and structural change. Chapter 3 discusses the statistical evidence for long-term changes in living standards and the distribution of income, or rather the absence thereof until the New Order regime. Chapter 4 tracks the role of government in economic change, while chapter 5 investigates the impact of international trade. Chapter 6 traces the role of investment in capital stock and human capital, and of technological change. The last core chapter discusses the development of markets and entrepreneurs.
The book takes stock of some of the recent literature, but almost exclusively that published in English. Consequently, it ignores several recent studies in Dutch and Bahasa Indonesia, such as à Campo (1992) on the KPM and transport development; Potting (1997) on the development of money and finance in Sumatra; Meijer (1994) on Dutch–Indonesian relations in the 1950s; Masyhuri (1995) on fisheries; and a host of studies on regional development (e.g. Clemens and Lindblad 1989).
It is likely that the book will be most appreciated by economists with enthusiasm for the fact that history presents so many opportunities to test the validity of current economic theory. The author indeed makes inventive use of such theory in order to understand Indonesia’s past. Some historians may not feel comfortable with this use of theory and therefore with the book. They may also feel uncomfortable with the author’s answer to the question why Indonesia is still a poor country.
Her answer, as the title of the book suggests, is that past governments have missed opportunities to spur development, and made ‘policy errors’. These ‘errors’ are not all clearly spelt out, but included are: the lack of public investment in education; the failure to achieve economic diversification (i.e. industrialisation) at earlier stages of development; the concomitant high dependence on primary exports; the consequences of the pursuit of conservative fiscal, monetary and foreign exchange policies; the failure to nurture a ‘class’ of indigenous entrepreneurs; the longevity of inefficient institutions.
It is interesting to speculate how different Indonesia’s economy would be today if these ‘errors’ had not been made. However, before readers can accept past decisions as ‘errors’, they have to understand that governments indeed had different options and had compelling reasons to choose the ‘wrong’ ones. They also require the counterfactual scenarios that demonstrate that the ‘right’ decisions would have led to a better result. For instance, the suggestion that past governments should have invested more in the development of a system of mass education (pp. 289, 328) leaves several questions unasked. Were public revenues sufficient to do that? If not, could more revenues have been raised for that purpose? Was education in the past regarded as a prerequisite for economic development, or perhaps for cultural and political advancement? Was there sufficient demand for mass education? Unfortunately, the actual policy options and counterfactuals are rarely discussed in detail.
may be useful in explaining the direction of short-term decisions. However, the concept is difficult to use when analysing a trajectory spanning 170 years (1820–1990). Numerous decisions were made along the way, not just by governments, but also by private enterprise and individuals. With hindsight, they may not have been the best decisions. The problem with hindsight, however, is that it was not available to those who made the decisions, and is therefore of little use when trying to understand why governments made the decisions they did.
At times the author reveals that she is ill at ease with history. For instance, she suggests that the use of Dutch as the official language during the colonial era was a trade barrier that benefited trade with the Netherlands (p. 216) and advantaged Dutch investors (p. 257). This ignores the fact that, for instance, British companies operated, often successfully, in many non-English speaking countries, including the Netherlands, and that non-Dutch companies in Indonesia were able to use local agents with knowledge of Dutch. It is surprising to read (p. 6) that Indonesian nationalists were concerned about the widening gap in GDP between the Netherlands and Indonesia well before the first estimates of GDP were available for either country. Or that Sumitro was a ‘technocrat’ in the 1950s (p. 222) before the term had been invented. The repeated use of the phrase ‘there can be little doubt that ...’ is certain to irritate some. If there is no doubt, there is no need for the phrase. Lastly, the listing of Achmad Sukarno (rather than President Sukarno) and General Soeharto (rather than President Soeharto) in the index (p. 375) seems ominous.
The sections on economic development after full independence in 1949 are the strongest. The author provides valuable observations about developments during the years 1950–65, about which not enough is known at present. She gives due credit to the achievements of former President Soeharto’s regime, but is frank about the collusive, patrimonialist character of the ‘predatory state’ he created (p. 336).
Despite the concerns raised here, this is an important book that meets a widely felt need for an overview of Indonesia’s modern economic history. It may not please all readers, but it challenges economists and historians alike to take note of its arguments. The book deserves to be read widely.
Pierre van der Eng
J. Thomas Lindblad (1998), Foreign Investment in Southeast Asia in the Twentieth Century, Macmillan, London, and St Martin’s Press, New York, pp. xiii + 240. Paper: £49.95.
There is a gap in the literature on foreign direct investment (FDI) in Southeast Asia. From the late colonial era, covered admirably in the standard reference by H.G. Callis (Foreign Capital in Southeast Asia, Institute of Pacific Relations, New York, 1942) to the 1970s, when a burgeoning literature becomes available, there is very little in the way of synthesis and systematic analysis. Nor, by extension, is there a volume that examines FDI into the region throughout the century in an integrated fashion. This volume by Thomas Lindblad of Leiden University is therefore very much to be welcomed.
A product of the ANU’s Modern Economic History of Southeast Asia Project, the book offers a concise yet comprehensive assessment of FDI during the first nine decades of the century. It reminds readers without a historical perspective that large equity capital inflows to the region are by no means a new phenomenon. Moreover, although the colonial and independence eras are not directly comparable, many of the analytical issues associated with FDI are remarkably similar.
A short introductory chapter identifies the key themes, emphasises the diversity of country experiences, sets aside some definitional issues (one in particular, how to treat ‘overseas Chinese’ investment, recurs frequently) and mentions the thorny issue of data quality and sources. These topics are examined in greater depth in a useful overview chapter entitled ‘The Historical Perspective’. Then, in ‘Pioneers and Profits’, we are given a close-up picture of the colonial period, with informative case studies of banking and manufacturing in the Philippines, timber and trading in Burma and Thailand, and rubber and the management agencies in Malaya and Indonesia.
The story then moves forward to the transitional period of independence and beyond. Here the country differences become more pronounced, of course, ranging from fierce nationalist pressures in Indochina, Burma and Indonesia, to the consistently open regimes of Malaysia and Singapore. The Philippines and the special case of Thailand adopted intermediate positions. (The sometimes strident opposition to foreign ownership in the former is not always easy to understand, given its relatively painless 20th century colonial experience.) Following this
transition, there is something of a turning point during the 1960s, in that all five original ASEAN member states began to adopt more liberal FDI policy regimes.
A contemporary readership will be much better acquainted with the analysis of the last two major chapters. From a home country perspective, covered mainly in chapter 6, there is the rise of the new investors—Japan, then the NIEs, and finally a European ‘rediscovery’ of Southeast Asia. Differences among these investors are also assessed. Next there is a competent description of the host country experiences and policy regimes of the ‘ASEAN Five’ from the 1970s to the early 1990s. The author’s brave attempt to summarise these approaches—’self-assertive Singaporeans, technology-minded Malaysians, growth-obsessed Thais, restructuring Indonesians, and optimistic Filipinos’ (p. 203)—gives something of the flavour of the chapter.
The volume was completed just before the onset of the region’s economic crisis, and released at its low point. However, in contrast with contemporary economic analyses published over this period, history has not been unkind to the author. Except in the case of Indonesia, FDI flows were little affected by these events, and in most countries they actually increased. The debate over capital controls in Malaysia and elsewhere never extended to FDI. Indeed, most countries in the region now have a more liberal FDI policy regime, either by choice (attracted by FDI’s greater sense of permanence) or dictate (IMF packages).
There is nothing especially original in the volume, nor is there any fresh rigorous empirical analysis. There could be major debates about the data base used, and some readers might have wanted stronger guidance on the overall costs and benefits of FDI to the region. This should not be construed as criticism: choices have to be made to fit the story into a little over 200 pages of text. The author has done an admirable job, and produced a book that all those with an interest in FDI and long-term Southeast Asian development will want to have on their shelves.
Hal Hill
ANU
Adam Schwarz and Jonathan Paris (eds) (1999), The Politics of Post-Suharto Indonesia, Council on Foreign Relations Press, New York, pp. 150. Paper: US$17.95.
This slim 120-page volume offers an important historical snapshot of Indonesian politics in mid 1998, just after the dramatic fall of President Soeharto. With chapters by five of the best known international specialists on Indonesian politics, including Bill Liddle, John Bresnan and Adam Schwarz, it illuminates some pathways for further work on the extraordinary story of the sudden collapse in May 1998 of Soeharto’s New Order regime. Since its publication, the steady course of political democratisation in Indonesia has continued to confound political observers. Successful general elections were held in mid 1999. A more dynamic political environment has seen the demise of President Habibie, and the surprise elevation of Nahdlatul Ulama (NU) leader, Abdurrahman Wahid, to the presidency in October.
The military’s grip on national politics has been greatly weakened, and former armed forces chief General Wiranto has been forced to step down from the cabinet. For the first time in Indonesian history the armed forces commander is a navy admiral rather than an army general. The police no longer form part of the armed forces (TNI). East Timor has been lost and the territory is set to become an independent nation within the next few years.
the sectarian violence in Maluku province remain a critical problem for the Abdurrahman government.
In his chapter on the demise of Soeharto, Bill Liddle shows how the ex-President’s desire to protect his own family fiefdoms, ignoring the letter of successive IMF bailout agreements, contributed to the collapse of confidence in his leadership by early 1998. The economic success of the New Order was an essential underpinning of Soeharto’s rule, and when the economy faltered in late 1997 opposition forces began to mobilise. ‘In the final analysis’, argues Liddle, ‘what is perhaps the most important is that from 1997 to mid 1998 the balance of political initiative shifted from the Soeharto-dominated armed forces to political activists outside the state.’ He correctly asserts that the army without Soeharto was thrown off its guard, with civilians moving into the vacuum created by the military’s lack of vision and initiative.
Robert Hefner contributes a valuable chapter on Islamic politics, charting Indonesia’s Islamic revival in the 1980s and the political tensions between leading Muslim organisations including the Soeharto-sponsored ICMI and Wahid’s NU. Hefner argues the most significant ‘clash of cultures’ today is not that between distinct civilisations but, as in Iran, Algeria and elsewhere, between rival political traditions within the same country. The Islamic resurgence has not produced a Muslim political consensus, but Hefner affirms the mainstream’s continuing commitment to democracy and peaceful change. ‘Despite the bitter legacy of the Soeharto regime and despite deep divides among Indonesian Muslims, the balance of forces in this country still favours the development of a civil and democratic Islam’, he concludes.
Takashi Shiraishi reviews the tensions between the top military leadership at the time of Soeharto’s downfall, particularly the strained relationship between General Wiranto and Soeharto’s ambitious son-in-law Prabowo Subianto. His analysis of the complex manoeuvrings in early 1998 points to the need for a fuller study of the military’s role in Soeharto’s demise. Tactical alliances between Wiranto and other senior officers at ABRI headquarters in early 1998, including Generals Susilo Bambang Yudhoyono and Agus Wirahadikusuma, did not endure beyond the fall of Soeharto. Shiraishi argues that despite the dramatic erosion of the military’s prestige the army still retains significant structural power, particularly through its territorial apparatus, which extends right down to village level across the archipelago.
and the lack of cohesion between the White House and key government agencies in Washington, including the State Department and the Pentagon. Bresnan argues that the Clinton administration was ill-favoured to play a strategic role with regard to Indonesia, with no senior administration officials having lived or worked in Indonesia. He also asserts the need for the US and the international community to develop new approaches to deal with global capital movements.
Patrick Walters
The Australian Newspaper, Canberra
Arief Budiman, Barbara Hatley and Damien Kingsbury (eds) (1999),
Reformasi: Crisis and Change in Indonesia, Monash Asia Institute, Melbourne, pp. 402. A$24.95.
This is a major multi-author collection arising from a conference in Melbourne at the end of 1998 that attempts to make sense of the stunning changes that unfolded in Indonesia in the year and a half following the onset of the Asian economic crisis. There are 19 chapters, organised into three sections dealing with economic, political, and social and legal dimensions of the crisis and the struggle for reform. The contributors, Indonesian and Australian, are from across academic disciplines and professional backgrounds. The book is not so much an edited volume as a collection of essays. There is no real attempt to impose an integrated framework or set of common questions, and there are surprising typographical and production blemishes (e.g. pages out of order) But given that the organisers were seeking to bring together a rich and varied line-up and, above all, to respond in a timely fashion to rapidly changing current events of great moment, this is understandable. More to the point, it should not distract from the main judgment, namely that this will probably prove to be the key book on this dramatic phase of Indonesia’s development. No doubt more careful, focused and rigorous studies will follow, but none is likely to capture the breadth and depth of the drama as fully as this one.
poverty and social dimensions of the crisis. A short chapter by Basri provides a clever and interesting analysis of some political economy dynamics of the crisis, but is suggestive rather than definitive. Although both these chapters are good and add value, BIES readers will not turn to this volume for its economic analysis.
The second section is the core of the book and presents 11 chapters on political dimensions. Again, all add real value. Budiman provides a thoughtful and academically grounded discussion of the dynamics of democratic transitions, locating Indonesia within the broader context of transitions elsewhere. For my money, this is the best chapter in the book. Of course there are issues to argue over, but more than any other chapter it has wider value beyond the empirical record it provides. Chapters by van Klinken, Young, and Hadiz also explore different dimensions of this theme. Two chapters by Crouch and Bourchier dissect the dynamics of the declining fortunes of the military. Both are good, with the Bourchier chapter having a little less analytical edge but a more comprehensive empirical coverage. I found the chapters by Meitzner and Falaakh on Islamic groups in reformasi politics to be particularly illuminating. In different ways, both carefully map the competing currents and factions of Islamic politics in the lead-up to and wake of Soeharto’s fall. Then follow chapters by Aspinall, Lane and Sumartana on students, social movements, and interreligious tensions. I especially enjoyed Lane’s chapter: along with his trademark scorn of mainstream (read, nearly all) politicians and academics, he provides a hard-headed analysis of winners and losers and the prospects for major improvement in the lives of ordinary Indonesians. The absence of dewy-eyed liberal romanticism about democratisation is both biting and revealing.
The third section of the book is more eclectic, but no less illuminating. Chapters by Hatley and Halim trace the way cultural forms give expression to the currents of political change. Heryanto and Kolibsono focus on gender dimensions, with subtle yet powerful analyses of the infamous rape of Chinese-Indonesian women at the height of the political crisis. Finally, a chapter by Lubis and Santosa, and another by Lindsey, explore the dynamics of legal reform and the prospects for democratic governance. Of the papers in this section, I found those by Hatley, Heryanto, and Lubis and Santoso to be particularly informative.
the result that nowhere do we really get an explanation of how the various pieces were all related. But this is probably inescapable in a volume that is striving for timeliness and to present a snapshot of all that was taking place. Overall, the volume provides powerful insight into many dimensions of the tumultuous changes in Indonesia and the way in which a range of scholars and professionals viewed these changes at the time. Anyone wanting a window into the drama of 1997 and 1998 should buy it.
Andrew MacIntyre
University of California, San Diego
Hal Hill (1999), The Indonesian Economy in Crisis: Causes, Consequences and Lessons, Institute of South East Asian Studies, Singapore, pp. 150. S$22.50; US$14.90.
Hal Hill has written a fine account of the Indonesian crisis. In this book, he makes brief reference to the prelude to the crisis, then provides a detailed account of its course, examines its impacts, reviews its causes, and talks about the way ahead. He finishes with some notes on a few big analytical questions.
Hill stresses the interaction between factors that made Indonesia vulnerable to a crisis and the way the crisis was managed. This conjunction of factors is the basis of an explanation for the relative severity of the crisis in Indonesia. He makes a distinction between triggers that set off a crisis and factors that determine its severity. Hill also works to reconcile the longer-run growth performance of the Indonesian economy and its experience of a crisis of this depth.
The vulnerability factors include the extent and nature of external debt in an environment of more mobile international capital, poor macroeconomic management, poor financial market regulation, and corruption, as well as problems of governance. In these areas, Hill tells familiar stories. But it is his commentary on the management of the crisis that is especially interesting. He talks about three things—policy errors, the contribution of corruption and the role of the IMF.
consequence was increasing inflation, further loss of confidence, and more rapid flight of capital, which then undermined the value of the rupiah.
Also particularly interesting is Hill’s discussion of the impact of corruption. In his view it is difficult to mount a case that corruption precipitated the crisis; the important contribution of corruption to the depth of the crisis was that it incapacitated the Soeharto regime as it tried to respond to the triggers. ‘Corruption’ is used here to denote a bigger problem than taking bribes or distorting tendering processes— those things are the instruments of the corrupt. It refers to the capture and control of the political system by one dominant group which over time worked more and more for its own benefit. This undermined public support for the regime, and weakened community expectations of its capacity to manage the crisis. The community’s doubts were then vindicated, especially when the President faltered in some early responses to the crisis, and when there was no effective countervailing force in policy making.
Hill reviews some of the prescriptions of the IMF, for example, the pressure for bank closures and the tight fiscal policy early in the crisis. He criticises the IMF for tackling too wide a set of policy issues. While in the end he says it is not a major villain, his assessment implies the IMF’s early interventions made the situation worse. Clearly, however, the IMF has learnt from this experience. Hill points out that some people think the risk is now in the other direction, of excessive flexibility by the IMF undermining the coherence of its policy advice. This experience of the IMF in Indonesia will bolster the work in progress on building regional institutions that can complement and deepen its monitoring and review functions and provide some sort of peer review mechanism, in ASEAN in particular.
The adoption of the reform agenda and its implementation depend on the political process. That is the weak point. Hill identifies the capacity of the political system to deliver effective economic policy making as a critical condition for his reform agenda to be met. He also presents a gloomy story about new political processes in which the players lack the skill and capacity to deliver coherent policy. These arise from the difficulties of coalition government, a weakened bureaucracy and the emergence of new sets of interests demanding to be accommodated, including those associated with different regions or ethnic groups. In addition to the factors he mentions, private interests at the industry or enterprise level will also be quick to perceive new opportunities as institutions are reformed or transitions occur. They are likely to distort the reform process as they plead special cases, demand protection, and threaten further disruption. Managing these interests has also been made more complicated by the consolidation of the private sector’s assets in the hands of the government as a consequence of the bank restructuring process.
A key to the resolution of these domestic political constraints will be the capacity to bring to bear the countervailing forces that also promote growth. In that context, Indonesia’s commitments to the international institutions, both global and regional, with respect to trade policy and to capital market openness will be critical.
At the start of his chapter on the way ahead for Indonesia, Hill presents three scenarios, one a quick return to high growth, another in which the economic decline is halted but political instability and lack of policy coherence deny a return to sustained growth at high rates, and a third, more awful, scenario of collapse. Hill rejects the first and third of these and says the middle or ‘Aquino’ scenario is more plausible. A push towards a return to high growth, or the ‘Mexico’ scenario, will depend on the second precondition for reform that Hill identifies—a favourable international environment. He characterises this condition as the support provided by the international market, in terms of export access, and by the donor community. More important, and a greater force for increasing the chances of moving out of the Aquino scenario, will be Indonesia’s own commitments to openness in goods, services and capital markets.
Christopher Findlay
Terry Dwyer (ed.) and Barry Reece and Craig Emerson (contributors) (1999), Resource Tax Policy in Countries of the Asia Pacific Region, Asia Pacific Press, The Australian National University, Canberra. A$20.00; US$20.00.
This is a rather odd little book. The title does not sit easily with the contents, since only about half of the book is about what most readers would understand as ‘resource tax policy in countries of the Asia Pacific region’. The half that does reflect the title is contributed by Craig Emerson, a member of parliament with a long history of interest and research in the area of resource tax policy, including an ANU PhD. Emerson’s chapters cover the principles of efficient mineral taxation and look at the tax policies applied in four countries in the region (including Indonesia). The editor, Terry Dwyer, contributes a preface and a short introduction that provide a succinct summary of resource tax policy issues in the Asia Pacific area. But the other half of the book, contributed by Barry Reece, seems somewhat out of place.
Reece, who, to my knowledge, has not previously contributed to the resource tax literature, arguably does not actually enter this field with his contribution to this book. Apart from the chapter on ‘trends in world tax systems’, his contribution is about urban land taxes in general and as applied in three countries in the region, particularly heavily urbanised Australia. The content of these chapters reflects the contributor’s long interest in these taxes—there is nearly a page of Reece references dating from 1975—and this is useful if that is what the reader is looking for. However, I do not think the kinds of property tax issues covered are likely to coincide with the interests of Indonesian (or other Asia Pacific developing country) analysts and policy makers.
particularly detailed, nor are they supported by sufficient references— an important shortcoming in a book that aims to introduce readers to its subject matter.
The editor’s preface and introduction provide a good summary of the issues of resource tax policy in the Asia Pacific area, including a discussion of the contentious issue of international tax competition. Dwyer argues that competition leads to greater efficiency because it results in more of the tax burden falling on the internationally immobile (‘inelastic’) factor of production, labour, and is therefore consistent with the Ramsey principle of efficient revenue raising. (This principle requires the tax rate applied to be positively related to the inelasticity of supply of the factor in question–or ‘thumping the one that can’t get away’.) On the other hand, he noticeably struggles to justify inclusion of the material on urban property taxes, and it would have been better if his two short contributions had been combined into one and considerably extended. Indeed, I do not think it is unfair to sum up the entire book by stating that it is far too sparing on the subject matter promised in the title.
Robert Albon
ANU
Januar Achmad (1999), Hollow Development: The Politics of Health in Soeharto’s Indonesia, Coombs Academic Publishing, Research School of Pacific and Asian Studies, The Australian National University, Canberra, pp. viii + 220. A$15.00 plus postage.
This book, the author’s doctoral dissertation, contributes greatly to an understanding of the strengths and weaknesses of the Indonesian health system, and of how health policy was formulated and implemented from the national level down to the community level, during the Soeharto era. The strength of the study lies in its presentation of ideas and information derived from the author’s observations and research while implementing public health and development programs in Central Java between 1980 and 1998, during which period he served 10 years as head of a government rural health centre.
particular concern is maternal mortality, a sensitive measure of the quality of health care, which is much higher in Indonesia than in various countries with similar or even lower levels of economic development.
The author focuses on factors that determine the government’s capacity to influence health sector performance, as measured by its effectiveness in reducing maternal mortality—especially maternal emergency care in rural areas. He explores the determinants of health sector performance within the health system itself, as well as in the broader socio-political context. In addition to chapters on the political setting and Islamic organisations as they relate to health programs, four major themes elaborated elsewhere include the role of the medical profession; the weak demand for health services; public administration and the financing of local government; and the low priority given to the health sector at the highest levels of government.
One of the most interesting points concerns the relationship between public administration, together with the local government financing system, and the performance of local health services. Although the Ministry of Health set policies, it had no control over their implementation at regional and local levels; district hospitals, health centres and health workers were supervised by the Ministry of the Interior, through local governments (p. 171). The implication for health services, according to the author, was that there was no incentive to improve them, since local government was accountable only to the Ministry of the Interior. Moreover, until 1998 only 25% of health service revenues could be retained by the health centres that generated them; the rest was used by local governments for non-health-related spending. The health sector thus came to be regarded as an income generating institution, rather than one for providing health care.
The author has done well in describing the political setting under the New Order and its ramifications for health sector performance. He describes how rivalry between the two Muslim organisations, Nahdlatul Ulama and Muhammadiyah, disrupted implementation of a particular health program. He also argues that, as with other sectors, restrictions on the flow of information, the lack of critical health research, and the low priority accorded to the health sector made former President Soeharto unaware of the extent of this sector’s problems.
government should provide extra funding to subsidise the health centres. Because of persistent maternal emergency problems in rural areas, he suggests that the government should train and equip general practitioners with relevant surgical and obstetrical skills.
Much of the discussion relates to the supply side of health services. Although the book’s title foreshadows an emphasis on the politics of health, important demand side issues deserve more emphasis than the author has given them (pp. 73–6). He briefly explains that underutilisation of health centres results not only from economic factors (including being poor and having to travel long distances), but in many cases involves cultural factors as well. In principle, poor people can request a recommendation letter from their village head allowing them to receive free medical service at health centres. However, no one ever asked for such a letter in the author’s area of research, and some even hid their illness in the absence of any intervention. Nevertheless, the author makes no attempt to analyse empowerment issues, whether they relate to the household economy, to education, or to more general questions of social welfare, that could increase health care utilisation by the public.
It is still unclear how the new decentralisation law will delegate health sector authority to the district level, and what roles the central and provincial governments will play in this new setting. Exactly how the new law will affect local utilisation and provision of health services, and how local government should prepare itself for its new role in the health sector, are just two of the questions needing immediate answers. Future health policy formulation in a decentralised Indonesia will undoubtedly benefit from the lessons described in this book.
Armida S. Alisjahbana
Padjadjaran University, Bandung
Terence H. Hull, Endang Sulistyaningsih and Gavin W. Jones (1999),
Prostitution in Indonesia: Its History and Evolution, Pustaka Sinar Harapan, Jakarta, pp. 161. A$10.00.
output at 0.8 to 2.4% of GDP, in 1996. (Whether the Central Statistics Agency makes its own estimates of the industry’s output is not revealed.) The number of customers is estimated at 5 to 8% of Indonesian males aged between 15 and 64. These are drawn from all levels of society; correspondingly, there are enormous variations in the circumstances in which commercial sex encounters take place and in the prices paid.
The authors trace the history of Indonesia’s commercial sex industry from the time of the Javanese kingdoms up to the present. An interesting observation is that certain areas came to be known as sources of beautiful and alluring women for the Javanese courts. Many of these were lower class women sold or given over by their families to take minor positions in the royal household, who could achieve higher status by producing children for the king. In a superficial sense, not much has changed in relation to the ‘commoditisation of women’. Today these same areas serve as disproportionately significant sources of urban prostitutes, in the same way that other locations have become known as suppliers of, say, building labourers and vendors of traditional medicines. Moreover, it is still not uncommon for families to seek material advancement by selling their daughters, though now into prostitution rather than into royal households. Although there are also instances of recruitment through force or deceit, the majority of sex workers—typically poorly educated, unskilled girls and young divorced women—appear to be in the industry by their own choice, since much higher incomes can be earned than in the other occupations available to them.
legal for one to sell one’s own sexual services; living off the earnings of prostitution is not, but this goes on nevertheless. From time to time this leads residents to take matters into their own hands and try to force the closure of brothels and prostitution-linked entertainment venues in their neighbourhood. Such pressure is partly defused by occasional police raids and closures, but the impact is never more than temporary.
In recent years different departments have adopted conflicting stances. For example, the Department of Manpower refuses to acknowledge prostitution as an occupational category, effectively precluding sex workers from receiving any protection that might otherwise be available through labour laws and regulatory structures. Likewise, the Department of Women’s Roles promotes marital fidelity and opposes prostitution. On the other hand, local government authorities and the military gain substantial revenue from operating brothel complexes, giving them an incentive to ensure their continued existence. Between these extremes, the Department of Health acknowledges the existence of prostitution in order to run health programs intended to prevent sexually transmitted diseases, while the Department of Social Affairs runs half-hearted ‘rehabilitation’ programs for sex workers, paying lip service to the notion that the industry can be made to disappear if only the women involved can be given other occupational options—a view that the authors show to be naive.
Perhaps the greatest problem facing the industry, and the greatest danger it poses to Indonesian society, is its role in spreading HIV/AIDS. High proportions of sex workers, their customers and their pimps are largely ignorant of this danger, so the use of condoms is yet to become the norm. The organisers and regulators in the private sector, government and the military who profit from the industry seem unconcerned about this issue, and the absence of open public debate and discussion suggests that the problem is likely to intensify.
Ross H. McLeod
