NOVEMBER 1, 1999
International Outlook

Can a Compromise President Hold Indonesia Together?

It was democracy at its most chaotic. On Oct. 20, Indonesia's People's Consultative Assembly, in a final spree of back-room politicking, agreed on Islamic cleric Abdurrahman Wahid, a man who is virtually blind, to lead the nation. The political jostling and last-minute compromising produced a carnival atmosphere in the normally decorous hall, with boos, cheers, and jeers not heard in Indonesian politics in decades. As the 691 members of various parties walked across the stage to mark their white paper ballots in voting booths in the wings, people were on the edge of their seats. "This is the first time we've ever done this," said an almost-incredulous assembly member from an Islamic party, peering over the balcony.

When the count was in, Wahid, 58 and in ill health, had pulled ahead of the popular Megawati Sukarnoputri, whose party had won the biggest percentage of the popular vote in the June elections. Because Indonesian laws left the elected assembly to pick the president, it chose Wahid, leader of a 34 million-member Islamic organization. Pivotal was a last-minute switch to Wahid's camp by Golkar, the party of deposed strongman Suharto and his discredited successor, B.J. Habibie.

CRITIC OF CORRUPTION. Now Indonesians--and the world--are anxiously wondering what a Wahid presidency will mean for a nation torn by political and economic upheaval. A man devoted to religious tolerance and secularism, Wahid emerged as a compromise candidate when Habibie withdrew after a vote of no confidence. But even though Wahid has long been a critic of corruption, his ability to rule effectively--particularly while sick and blind--is very much in question. "You don't just change the government and get rid of corruption," says Mark Baird, Indonesia director for the World Bank.

But Wahid seems willing to try. He has said he would ask Suharto to admit publicly that he and his family hoarded a fortune during his 33 years in office, to apologize for abusing the public trust, and to return the funds to the government. In his first speech to the nation after being sworn in, Wahid, wearing a business suit rather than white robes or casual clothes for the first time in recent memory, acknowledged the "problems ahead." His agenda includes uniting Indonesia's disparate Islamic groups--but also taking a moderate and secular stance on issues such as Islamic banking and Islamic law.

His stance on other issues, including the continuing influence of the International Monetary Fund over the economy and the role of foreign investment in Indonesia, was not immediately clear. "Of course, the government will become more Muslim," predicts Hamzah Isa, coordinator of Barisan Masyarakat Mayoritas, an Islamic non-government organization in Jakarta. But Wahid knows where to draw the line. He told BUSINESS WEEK in an earlier interview that Islam only works well in a democracy and that democracy cannot function in an Islamic state. Wahid also places importance on peacefully ending breakaway movements in Indonesia's remote islands and provinces--particularly following the bloody aftermath of East Timor's vote for autonomy.

But the question of Megawati's role remains. Thousands of her riot-prone supporters immediately protested her shutout from political office. After the vote was counted, Megawati fought back tears and begged them to "accept the result for the sake of the nation." Yet not everyone agreed: Several bombs went off at separate locations in the city. If unrest continues, the role of the military and Commander-in-Chief General Wiranto will become increasingly important. The drama of this election is far from over.

By Michael Shari in Jakarta; Edited by Sheri Prasso