O ■ - / r ' ' i o ~Y '>7-' ' e c? THE EIGHTH YEAR OF A FREE NATION 1952 August 17, 1953 Republic of Indonesia ^ y Philippines / ^ Indian Ocean Pacific Ocean ,€C’ ^ ;953' by Dr. Ali Sastroamidjojo Prime Minister, Republic of Indonesia (Former Ambassador to the U. S. A.) Eight years ago the proclamation of Indonesian independence signalled the beginning of a new era for our nation and our people. On August 17, 1945 the Indonesian nation came to life again, after 350 years of outside rule. We fought for our freedom, and won it. But this victory was not, of course, an end. It was the opportunity to begin the tremendous task of building a new national community out of our smashed cities and ravaged countryside. We were then, as now, potentially rich — after the United States and the Soviet Union, the world's third richest country in natural resources. Our resources, however, were still in the ground. Our earth had been scorched. Many of our factories were destroyed, and thousands of our people sick, wounded, and hungry. Further, we had to overcome the handicap of a colonial-type agricultural economy that did not allow us to produce more than a small percentage of the goods we needed. The most forbidding handicap of all was the shortage of trained personnel. It should be remem- bered that when the Republic of Indonesia came into being only seven per cent of our people could read and write. That was our situation. Today, looking back across eight years, Indonesians may ask themselves: "Have we measured up to our task? Have we made freedom mean something, in terms of progress and a better life for our people?" The answer is certainly yes. This may be said, even with full realization that we have made mistakes, and will undoubtedly make more mistakes before we build ourselves into one of the world's great nations. Yet consider what a long distance we have come since the spectacular days of 1945. Consider, for example, that in this month of this year more than 40 per cent of the Indonesian people can read and write. Let us regard with pride the numerous factories we have repaired and built, the roads and rail lines that have been laid down, and our growing air and merchant fleets, the hundreds of new schools and hospitals we have created where there were none before. We may also be proud of Indonesia's record in foreign relations. We count our Republic the friend of all countries and the foe of none. It is not too much to say that our diplomats have worked most effectively for peace in and out of the United Nations. The world knows we are devoted to the cause of peace. We join others in thanking God that the tragic Korean conflict has been brought to a halt. In this coming year, Indonesians look forward to these things; 1 . Peace in the world. 2. The first national elections in our history. 3. Trade with all nations on a basis of mutual benefit. 4. Greatly increased production at home, so that our people may have more of the world's goods. The Indonesian Government and people look forward to continued friendly rela- tions with the governments and peoples of all the world. Digitized by the Internet Archive in 2016 https://archive.org/details/eighthyearoffreeOOindo TABLE OF CONTENTS PAGE l. STATE OF THE NATION — AUGUST 17, 1952 1 n. THE ECONOMY 3 Imports Limited Dr. Sumitro Reviews Indonesia's Economic Situation Overcoming the Rice Shortage Questions of Nationalization - Oil & Tin m. A PRESIDENTIAL "WHISTLE STOP" TOUR OF CENTRAL JAVA 8 IV. THE ARMED FORCES CONTROVERSY 9 V. THE BUDGET AND ELECTION BIL.LS 13 VI. FOREIGN RELATIONS: AUGUST - DECEMBER, 1952 14 Indonesia and Holland U, N. Hears Indonesia Protest Netherlands Action on Irian Indonesia and Japan Indonesia and West Germany Indonesia in the United Nations Tlie Republic's View of the Trusteeship Problem Vn. MR. MOEKARTO: U.N. NEEDS "REBIRTH OF ENLIGHTENED REALISM"'18 VIII. MIDYEAR ROUND-UP 21 Foreign, Economic, Education, WHO, Doctors' Congress, Dancers of Bali IX. PROGRAM FOR THE NEW YEAR 25 X. PARLIAMENT PASSES GENERiVL ELECTIONS BILL 27 XI. THE FINANCIAL OUTLOOK & ECONOI/ilC NEV/S 27 An Increase in Imports Dr. Sumitro and Ivlr, Sumanang Tell Parliament. . , The Critical Situation for Natural Rubber The Java Bank Becomes the Bank of Indonesia XH. FOREIGN RELATIONS 30 Indonesia and the United States Indonesia and Holland Foreign News Round-Up Xm. INDONESIA'S LEADERS SPEAK 34 XIV. INDONESIANS AND AMERICANS 35 XV. WILOPO CABINET RESIGNS 36 XVI. DR. ALI SASTROAMIDJOJO HEADS MDONESIA'S NEW CABINET 37 . 1 : I I j r - * ' f ; r. T « . ' • T - i ; rj .-• ^ . : ; *• ;r 1 T' . 'lOl- . Tl. .mx d .. .vx .IVX I. STATE OF THE NATION - AUGUST 17. 1952 Indonesia's eighth year of Independence began with growing stress on the Republic's foreign and economic policies. They were to some extent inter- related. It was a foreign policy decision, for example, that led Indonesia to abide by the United Nations ban on the shipment of strategic materials to China. The repercussions of this decision were economic, for Indonesia's main export, rubber, came under the ban. While the enduring Korean V/ar continued to test the nation's independent foreign policy, lower world prices for Indonesian rubber and tin put increas- ingly heavy pressure on the econom.y. Midsummier 1952 saw the development of an unfavorable balance of trade and a growing foreign exchange deficit. To counterbalance this, security conditions throughout Indonesia were much better than they had been for m.any months. V/ith all but a handful of the members of Parliament giving the Cabinet of Priime Minister Wllopo a vote of confidence, the Cover nm.ent had solid national backing. At the end of July President Soekarno had been able to sign a decree ending the "State of Siege " for a large part of the Republic. The "State of Siege" Law -- not as severe as it sounded — gave military commanders wide powers to deal with subversive activities. These powers were now dee'med unnecessary except in parts of West Java and South Celebes, This was encouraging because greater unity meant more production in Indonesia. Production, it was emphasized by virtually every Government speaker on August 17, the Seventh Anniversary of Indonesian Independence, was the one all-embracing answer to most of the nation's problems. President Soekarno Speaks President Soekarno made this clear in an hour-long address to the Indonesian people. "Unity and hard work, " he said, were needed to transform - 2 - national ideals into reality. The President’s words were carried throughout the country by Radio Republik Indonesia. He spoke to a huge crowd surrounding Merdeka Palace, in the presence of the Cabinet, members of Parliament, and the diplomatic corps. He said the Republic's independent foreign policy was neither isolationist nor passive. Indonesia would not lock itself "in splendid isolation, " he declared, "We don't remain quiescent, V/e strive, we plan, we extend our hand left and right. We are aware that in the world society of today, , . whose members are interdependent, , . it is no longer possible to implement a policy of isolation — indeed it can lead us to destruction. Our independent policy is dynamic. , , . (It) seeks to draw closer to other countries, with tlie aim of promoting v/orld peace in liarmony with our national interests and the Pantjasila. "* Later in the year, and in the first montas of 1953, the President's description of Indonesian policy v/as to be translated into strong action by the Republic's representatives in the United Nations, in a number of moves to help end the Korean conflict. (The independent policy was also clearly defined in Vice-President Dr. Mohamad Hatta's incisive article in the Spring 1953 num.ber of Foreign Affairs Magazine, See P.36 } The President struck hard on the issue of colonialism, reaffirming Indonesia's support of the Tunisian nationalist movement. "Wnerever there is colonialism it should be abolished, " jie said. Always outspoken on Indonesia's claim to West Irian (New Guinea), currently occupied by the Netherlands, he declared tnat the situation in the disputed territory was a "thorn in the flesh of tlie Indonesian people, " He said: "So long as West Irian represents a power concentration of the remnants of the former Netherlands East Indies, that long will Indonesians feel themselves threatened from tliat direction. ..." President Soekarno urged tie thousands of Indonesians before him, and the millions listening to the nation-vvide broadcast, to rededicate themselves to the job of building a great country. "To recapture the spirit of tne Proclamation, we must have, first, a spirit of national freedom; second, a serious determination to forget self for tie sake of t:e commonweal; third, a spirit of unity, and fourth a spirit tiat does not know how to be tired dedicated to the reconstruction of the nation, " he concluded. The five principles of Indonesian Statehood — Belief in God, Humanitarian- ism, Nationalism, Democracy and Social Justice, > A * 1 -3- II. THE ECONOMY A week before the President's Independence Day address, it was brought home to the Indonesian people that the national economy was in need of strengthening. The Finance Ministry announced curbs on the import of luxury goods into Indonesia. Imports were divided into four classes; A. Goods essential for daily living, B. Goods useful for daily living, but not absolutely essential, C. Luxury goods for which importers may obtain foreign exchange, D. Luxury goods for which no foreign exchange is available. Imports Limited Importers had to pay an inducement of 100 per cent of the c,i,f, price on Class B goods, (For example, if an article cost $1,00 the importer had to pay 22, 80 rupiahs, or twice the official rate. For Class C goods the inducement was 200 per cent. ) In addition, the Foreign Exchange Institute ruled that until further notice banks would not be permitted to handle import credits. While imports were being restricted, exporters were encouraged by a lowering of duties on rubber, palm oil & palm kernels, and copra. The Backcrround In a report to the annual meeting of the stockholders of the Java Bank held in July,* President-Director Dr, Sjafruddin Prawiranegara (who was Finance Minister in the Natsir Cabinet) gave the background of the Republic's economic situation; ",,.The economic development of Indonesia in 1951 was marked by a strongly increasing prosperity in certain sectors of the national economy, caused by temporary factors. On the other hand, only partial progress was made in tlie matter of lasting structural improvement. The most important of these prosperity-making influences — apart from local circumstances -- was the Korean conflict, which brought about major increases in the prices of and demand for raw materials, ,. "Indonesia had the good luck to find itself in the mi ddle of an economic upsurge during the past year. The temporary nature of this favorable economic trend is too little realized. . . the basis of Indonesia's production is too narrow and it will have to be expanded considerably. Only an expansion of the national income and broadening of the basis of production can lead to greater prosperity, , , " * “f 124th year was 4, UOl, tiay rupiahs. The Stockholders received a dividend of 15 per cent. -4- A Radio Indonesia broadcast from Djakarta August 4 announced new measures reducing taxes for the lower income groups and also cutting the property tax. Incomes of less than 30, 000 rupiahs a year would pay a rate of 10% -- half the previous tax. The new rates were instituted, Radio Indonesia said, because the Government believed the previous taxes were a deterrent to private initiative. In general, the new import regulations were approved by the Indonesian press. Socialist Pedoman said: "Considering its current financial position, our Government has no choice. The important thing is that more people will no longer be able to buy luxury goods. , . . The steps taken so far by the Wilopo Government in the economic and financial fields, such as decreasing various taxes and the reduction of additional export levies on several kinds of raw materials, have decreased the burden on producers and may succeed in influencing the cornmuiiity to work harder to increase production. . . , The question seemed to be — would the encouragement given to private enterprise overbalance the loss of State Income resulting from the new meas- ures? Dr. Sum.itro Reviews Indonesia*s Economic Situation V/hile these discussions were going on Finance Minister Dr, Sumitro Djojohadi^sumo brought the country to attention v/ith a 45 - minute address over Radio Indonesia, He told Indonesians frankly that the Republic's economic condition was serious. (His address was titled: "Facing The Situation".) These were the difficulties: 1, A deficit of 4 billion rupiahs in the current year's budget, 2, Decreasing exports. 3, A tendency toward increased imports. 4, The upv/ard pressure of costs. 5, The rising cost of living. 6, Deterioration of Indonesia's balance of payment position, 7, The drain on the nation's monetary reserves. The Finance Minister said the Government rejected a policy of deflation to reduce the budget deficit. "On penalty of complete disintegration of our eco- nomic and social life, we must succeed in miaintaining and increasing the economic resistance of the commiunity, " he declared. Dr, Sumitro listed the major steps taken by the Government to reduce the budget deficit. They were* (aj to increase the volume of exports extension of food production (c) application of modern agricultural methods establishment of central processing plants, and (ej extension of the cooperative movement. In addition. 4 1 ( .1 d t • -5- he mentioned {Q the highway construction project for Sumatra ( 2 ) the reclama- tion plan for Borneo, and (h) industrialization programs being carried out in various parts of the country. The Finance Minister pointed out that there was a great deal of money in circulation in Indonesia's cities (an inflationary condition), while there was inadequate purchasing power in villages and outlying areas (a deflationary situation). The country's immediate task was to prevent these discrepancies from worsening, he said. The Government would foster reconstruction and industrial projects to keep the discrepancies in check. He told his listeners that the Republic's present fiscal policy was based on the plain and simple principle: "alleviate, if necessary eliminate, burdens that might discourage production, but soak those who play around with surplus money, " Dr, Sumitro summarized the measures taken by the Government in the past five months to bolster Indonesia's economy: 1, Reduction of income tax scales, lessening the rate of progression, 2, Reduction of wage taxes for the lowest income brackets, 3, Lowering the extra export duties that have been in force, to improve Indonesia's competitive position in world markets, 4, Controlling and decreasing the rates of Dollar Export Certificates, 5, Drastic limitation of imports, by indirect controls, 6, Cuts in Government expenditures abroad, 7, Economies in public outlays, 8, Abolition of free transportation (for most Government officials), 9, Reorganization and improvement of Government administrative apparatus, 10, Advance cash deposits of 40% required for all foreign exchange transactions, to tie up surplus liquidity, 11, No transfer of profits, or transfers based on depreciation, are permitted if they are financed by bank credits or loans. 12, Credit facilities have been expanded for productive activities in rural areas. • ■••• 'P' i ’vA t'y.^^C' f■ W i /7 . ,\VJ J '7 ' iJ . 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'■ 1‘. ;-'X^ Avdi. .GGjL' i *is> ‘:o va/iG 0ViJC'i^‘''''Ti ' *j[0' ' ■;■ rd 9V£iii-sr.^'r,Ir-js) 5li;airr. .I-. yii... i-yiv\ irf ; . v> ' X - 6 - 13, Development plans of importance in islands outside Java are being caimied out, 14, Rural development of small - scale industries, 15, Large - scale industrial projects now in preparation, 16, Preparations for speedy construction of highways in Sume-tra, to be started by a foreign organization on a contract basis, 17, Inheritance tax to be reimposed, 18, Heavy luxury taxes to be imposed on private passenger cars, 19, Indonesian participation in the International Monetary Fund and the International Bank for Reconstruction and Development, Indonesia's problem is not primarily one of finance and money but of production and hard work, Dr. Sumitro concluded. "We must do the impossible - and even if and when we do the impossible, the possible is still far off, " said the Finance Minister, "But we accept tlie challenge, " OvercomincT the Rice Shortage In his report to the Java Bank stockholders. Dr. Sjafruddin Prawiranegara had taken note of Indonesia's chronic rice shortage. This was one of the Wilopo Government's major concerns. In 1951 tiie Republic had imported 400, 000 tons of the nation's staple food. In 1952 it was estimated that 600,000 tons would have to come from abroad. Large-scale imports of foodstuffs were unhealthy for the economy. Dr, Sjafruddin said. Secretary -General Gunung Iskander of the Agriculture Ministry disclosed, in September that the Government was developing an ambitious program to make Indonesia self-sufficient in rice, A major part of the new program would consist of opening new farm land, constructing irrigation dams, building roads through virgin jungle and the reclamation of wasteland. Nev/ roads in North Sumatra v/ould give access to farm lands that should produce at least an additional 30, 000 tons of rice in a single year, the Secretary-General said. About five thousand acres of rice land in East Sumatra v/ould be opened up for rice production, with the aid of Government tractors. Meanwhile the greatest project of all — the huge swamp- drainage program in Borneo (Kalimantan) would reclaim many thousands of acres for rice cultivation. In addition, 100, 000 acres of riceland in Central Java were to be irrigated follov/ing completion of a hydro-electric power dam at Jatjaban. Questions of Nationalization - Oil k Tin At the end of September the disposition of two of Indonesia's most important ■ I - f f £< r j T’j ' .VIOT ''■^<'"0 " ■ r'd , C ”S .' ■ . •. 'ijci j 6 \'Hu - :o 3 ii»- . . ■.*?•.•* ".b .»•/- ij,' v;' . t: >• •"‘•i fcixl'^.cjrr- ■■[ ;v.. - J'l *;■ ..i 7 i;w: 5 na’: 1 .. i ’"■■' 'Tq:. r . . vqij-r^L . - A'c‘-t^;vrr'/^' -M'V- " . v • f i ;X:: , vdc. !\r7 .' 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The problems were Wiiether to (^) return the North Sumatra oil fields to the BPM Oil Company, the original owners, (b) take over operation of the Banka tin mines from the GMB Billiton Company, The Nortn Sumatra installations had been seized by the Japanese when they occupied Indonesia in 1942, Li 1945, shortly after the Republic’s declara- tion of Independence, Indonesians took the fields from the surrendering Japanese, Indonesian technicians rebuilt the damaged facilities, and started operations. They held on to the North Sumatra fields throughout the struggle for Independence, Tne question now arose -- since tne fight was over, what should happen to these oil lands. Undeniably, in the colonial era, they had been the property of Netherlands interests. Yet the continuity of ownership had been broken by more than ten years of war and political change, Indonesians had manned the fields. Indonesians were working them now. In August, a specially-appointed State Mining Commission under Home Affairs Minister Dr, Monamad Room decided by majority vote that the oil land should revert to BPM, This decision provoked a strong reaction from national- ist groups in Parliament, Generally, tiie Nationalist Party (P.N.I, ) favored nationalization, while tne Masjumi Party was generally inclined toward returning the installations to tiieir former owners. Economic Affairs Minister Sumanang -- a P.N.I, member -- declared at a press conference September 19 that return of the land v/ould be justified politically and economically, "If necessary we could follow t.ie example of Iranian Prime Minister Mossadeq, " ne said, but added tnat the Republic should beware of taking too hasty action. He noted t.iat the oil companies in Indonesia were paying 80, 000,000 rupiaiis a year in taxes. There were liitherto unexploited oil fields in Indonesia tnat could be developed by Indonesian capital, tne Economic Affairs Minister said. * The Djakarta daily Merdeka commented: "The constitution says the natural riches snail be controlled by the State, Tnis principle leaves no room for misunderstanding concerning the mines in Indonesia. We don’t deny that Indonesia lacks its own mining experts. But this does not mean that BPM will automatically get back the oil fields in North Sumatra, " Merdeka asked: "Would it not be wiser to continue exploiting the resources which are already in our nands, with the assistance of foreign experts, to meet hie demands of the home market only? Other natural resources now being exploited by foreigners can then continue producing for the world market, " The issue of the North Suriiatra oil fields gradually assumed the status of a permanent disagreement between two groups in Parliament, It was one of the so-called "frozen questions " that eventually in tiie early summer of 1953 led to tne resignation of the Wilopo Government, The decision of the Gcv^ernment to take over operation of the Banka Tin Mines was a very different matter. The GMB Billiton Company’s contract to The North Sumatra fields produce only a small percentage of Indonesian oil. Therejias been no q^sti^ of nationalizing the. big oil -rich areas, for example, )ang wnere foreign companies ^continue operating. * * near Pale mt \ - 8 - •N operate the mines expired in February, Before World War II the Banka Mines were operated by the Netherlands Indies Government as State enterprise. During the Japanese invasion and occupation of Indonesia most of the specialists on Banka Island were killed. After the war, the Netherlands colonial administration reoccupied Banka. The GMB Billiton Company -- 3/8ths privately owned and 5/8ths owned by the Indonesian Government -- had always been a private tin-producing enterprise. It v/as asked to run the Banka Mines, since most of its personnel had escaped deatli at the hands of the Japanese. The contract was for five years. As soon as the contract expired, the Indonesian Government decided to return Banka to its traditional status as a State enterprise. The action did not represent a move toward nationalization. On Billiton Island the Billiton Company's concession was renewed until February 28, 1958, m. A PRESIDENTIAL "WHISTLE STOP” TOUR OF CENTRAL JAVA In an Indonesian equivalent of an American President's "whistle stop" tour of the countryside, President Soekarno visited scores of towns and villages in Central Java during September, He was not, of course, running for office or promoting the fortunes of any political party. The purpose of his trips to the provinces of Indonesia is to unify the nation. In Central Java, traveling much of the time by car, he covered nearly 2,000 miles and delivered fifty speeches. In such towns as Demal:, Djapara, Kudus, Pati, Rembang, and Blora thousands turned out to cheer the chief executive. Significantly, wherever he went he was met by posters and demonstrations demanding the return of West Irian, At Pati the President emphasized to an audience of ten thousand that the claim to West Irian was not simply that of "Bung Karno"*, but of the entire nation. "Indonesia may change its President, but the national claim will be maintained, " he said. He touched on many matters in the different communities, coming down again and again on the tneme that the Indonesian people would have to work hard to gain prosperity for themselves and the nation.** At Djapara the population * Literally, "Brother Soekarno", as American crowds in the same month were hailing "Ike" and "Adlai". ** Meanwhile education authorities in the province announced that 561, 000 persons had QTaduated from literacy classes in Central Java, This left 8, 000, 000 of the province's 15, 000, 000 still to be taught how to read and write. With 8, 500 classes currently in session, and more being set up every day, Central Java expected to complete its intensified literacy drive in ten years. \ t • j- ; -9- lifted him out of his car and carried him to the platform where he was to make his address. Later, at Demak, he visited the first mosque built in Indonesia where several old Javanese kings are buried. He stood beside the grave of the pioneer leader of Indonesian women, R.A. Kartini, in the town of Rembang. Time and again the presidential cavalcade was stopped by crowds miassed along the road, and could not go on until he addressed the throngs. He urged the farmers not to long for the city. They had big jobs to do in their own villages. He told them: "V7ork from dawn to sunset to contribute your share to the prosperity of our country, " IV. THE armed forces GONTROVSR3Y The President arrived back in the capital to find Defense Minister Hamengku Buwono, the Sultan of Jocqakarta, under s'trong criticism in Parlia- ment, The trouble was sparked by a Defense Ministry decision to suspend General StaH officer Colonel Eam.bang Supeno for ''undisciplinary” actions. Although Vne specific charges were not made public, it was clear that factional differences had divided the top echelons of Indonesia's Armed Forces. The Defense Minister was called before Parliament October 1 to explain his policies. Despite a vigorous accounting of what he was ti'ying to accompilish, voices in Parliament continued to call for changes in the Defense establishment. The October 17 Affair On October 16, Parliam^ent passed a motion by L/Ianaai Sophian of the P.N.I. calling for the early withdrawal of ttie Netherlands Military Mission from Lidonesia and the appointment of a State Comimission "to put forward concrete proposals for changes in the top echelons of the Defense Ministry itself and in the Armed Forces. " The vote was decisive, 91 - 54. On October 17 a massive demonstration took place in the streets of Djakarta, The demionstrators sliouted their support of Defense Minister Hamengku Buwono, the Sultan of Jogjakarta. ITiey demanded the dissolution of Parliamient and the holding of early elections,* Crowds entered the Pcirliament Building and wrecked furniture there. Later they assemibled in front of the Presidential Palace, President Soekarno appealed to tlie demonstrators to show a spirit of moderation. He declined to dissolve Parliament, saying he did not want to act as a dictator. Public opinion in other parts of Indonesia would have to be assessed before any such action co’old be taken. He reminded his listeners that Indonesia's first general elections would be held as soon as possible. After hearing him, the crowds dispersed. During these twenty-four hours, the Army was 'much in evidence. Over the weekend (October 17 was on a Friday) an 8 P, M, to 5 A.M, curfew kept the population indoors. In the confusion a number of right -and left-wing members of Parliament were taken into "protective custody", (These ranged from former Prime klinister Dr. Sukiman of the Masjurni Party to Com'munist Party leader S^lrman. ) Tvo newspapers, Merdeka and Berita I ndonesia, which had approved Parliament's vote, were closed! Train and plane ti^ffic in and out of tiie * Members of ]todonesia's provisional parliament were appointed by the political parties, according to a system of proportional representation estaolished by a presidential com.mLittee, ■ ^ •- 'n 'V, J . J . i,*4’ »lv'l ^ T' if V iij\. ^ ,fc V'Biir . -j '(Oipnol 7y 3‘i .in-a ;v- :::if 'J. ^j.ai .V io ,. i: <:.* • - -V .*» * L*L *W^ ' '•‘-“ ' • •■■f S-, iT ^ 1 sr^.^' if)i*- 'r * *\ 5 /^ • * V ■ • 4 •'I , r -T> — **. ■ ^ •’ f L ^o.;- ■" * ' »* • ■ *. t 4 "■ ? J 43v J ‘ - 4 ' * . ^,:^:'LS:^J:c^■:' •• ^ ^ *:CV^ ir '* ■ j ^o-ro^vL-.f: ':' V e:*T ...ij x-f 'i:'.';-’; T- i-£^b i£ 1 ~neC o:‘>:a:r e: j rl^i.cn:i*\ • r^I k .•' ■ i. . T .. b;\. ^ ny'.:^x icij"; ^rv7 xB*c^>l'A eyi^^:.JZ- ;./:■■ -• ::^ .b *i> jvb ';:iv ;j 3 'ijf -xZ icU . or :f 5 no)''i£ii*:£“ .■Lfi. :x . ■; J- r? < Z-nO i> ' . i. . * :7£o •'•» • :03 'T'" i. :i.r J, t •* ► • • • 9i'.£.-C .:jS ci:<. : .rroxi > ■•.? n.. .'-p- r* * J.. r. : Irso-'lj*: .-to - S. ' 1 e • -^ vac>: / b ' VI A s*:i •:. f TO .1: '• r: r'i^' i . X>‘ •£ .': iscfoic 0 frO . U . ' i* v o J -T ;!£tCI r- i.' . . V. it: V . , ‘ • .<;> •i ‘0\y£.--i riirrr- .--,T ; *^ * * «?. - ✓ . *. 1 . •Io£ - i'J bn£ : :..9rn£‘ iX£,^ , . . U- . ...... ‘ • 1 - » ^ i .V w^. >• -..* X. ^ *' ■ ■•■.''. ’ci O'lOj •i'.v , i‘-v. i-; ; . r.»''AC 1 w «■ ^: ■ •*: '.iOL 4^,-4 -. - . . • . .7 J 1 J « -c c: '^ 9 i:-' 5 L£l is y • . :' .n '■< ■ - 3£-- ,. -ro:-! .li iv.iiri:. -.Tx: *T5V.' JiS “iJ^k-XiO.- ■- . w ■ ” .^ 3 'cZri}'= ■• ‘ ''XZ ‘. :v:T 'ilrd oM"^ 9 :T!£xL‘‘i£ v 1 ■ -V. f- ; jTO '■'O^ U ' i ■• i; ~,d ' r-'rifu.s.tc -.*' ♦ ■ l 7 j U. CO if.. - 10 - capital were strictly controlled. The general public did not know that a group of Army Territorial Commanders had called on President Soekarno and tried to persuade him to dissolve Parliament. The Indonesian people did not learn until some days later that the demonstrations had not been spontaneous at all. It turned out that they were organized by certain Army officers. Background of the Affair The Defense Ministry and the Armed Forces had been under fire in Parliament for some time. These were the main reasons: 1. The Organi^tion of the i^my . The Defense Minister and top head- quarters "oMcersinT^aSaHirwa^^ limit tiie Indonesian Army to 100 battalions. Their idea was to reorganize the Army into a relatively small, compact striking force built along Western lines. They wanted to accomplish the reorganization immediately, a move that would bring about the discharge of some 100,000 soldiers within a few montlis. Adherents of this view argj.ed that Indonesia did not have the money to maintain a large army. Budget slashes announced by Finance Minister Dr. Cumitro Djojohadikusumo in his message to Parliament were cited to support their position. Many legislators and Army officers disagreed witli this plan. They felt that a virtually overnight reduction of the Armed Rjrces would have a negative effect on military and cimlian morale. To dump thousands of men back into civilian life all at once would create a number of serious pr oblems, this school of thought believed. It would, for one thing, bring on tensions resulting from inevitable unemployment, housing shortages, etc., the Defense Minister’s opponents contended. Ivlany also felt that the Army should place greater reliance on partisan cadres tliat had fought so well during the struggle for independence, 2. The Netherlands Military Mission in Indonesia. For the past three years a 1/l'ilitary Mission from the Itetiierlands has been helping to train Indonesians in modern warfare. This m.eant, ironically, that Indonesian forces were taking lessons from the soldiers they had fought during the struggle for independence. On the technical level Indonesian and Dutch soldiers seemed to be cooperating well enough. There was still a question whether it was wise to maintain even a small Dutch military cadre in Indonesia, Again, the Sultan believed the Mission should stay. His critics v/anted the Mission to return to Holland, 3. Charges of Political Maneuvering in the Defense Ministry & Arm.ed Forces . There v/as criticism in Parliamentary circles of political infiltration in the national defense establishment. In particular, it was charged (and denied) that the Secretary-General of the Defense Ministry, the Armed Forces Chief of Staff and the Army Chief of Staff were sympathetic to the Indonesian Socialist Party. It was said (and denied) thai officers were advanced for political rather than military reliability, ^^^'^^sing Methods. Critics in Parliament also attacked what they called inefficient practices by Army purchasers. J 4 - 11 - In a two-hour address to Parliament, the Defense Minister answered his critics. He invited the legislators to establish a joint Government-Parliament Commission to study the organization and training methods of the Army. This Commission would recommend whatever changes might be necessary. At this point there was pending in Parliament a motion of no-confidence in the Defense Ministry authored by non-party member B^aruddin. If passed, it would probably have produced an immediate Cabinet crisis. Opposed to Baliaruddin's motion was a counter -recommendation offered by several Govern- ment parties (including the Masjumi, Socialists, Labor and Catholic parties). It provided for the establishment of the Committee suggested by the Sultan, But the temper of Parliament made it plain that some kind of disapproval of the Defense Ministry would have to be expressed. Thus the motion of the P.N.I. calling for eventual "changes" in the Ministry and the Armed Forces v/as appro\ed by Parliament. It was a compromise. It forestalled the left -wing -backed Baharuddin motion (finally beaten 60 - 39), and at the same time paved the way for possible shifts in the nation's military policies. The Government and the Army It was now common knowledge that a group of Army officers had been behind the October 17 Affair, Protesting the actions of what they considered to be the military clique in Djakarta, the chiefs of staff of three Indonesian divisions deposed their commanding officers. These three Lieutenant-Colonels — Sudirman in East Ja\^, Warouw in East Indonesia, and I^etartoin South Sumatra -- swore allegiance to President Soekarno as Commander in Chief of the Armed Forces, V/hat they wanted was a new deal in the Army, They charged their superiors in Djakarta with playing politics and interfering in the political life of the Republic. In a lengthy statement released November 22, the Government explained what had happened on October 17, There had not been an attempted coup d'etat, it was emphasized. But the Army had temporarily usurped civil authority. The upshot of the crisis was that the territorial commanders had returned to their posts without having gained their objectives. The Government was then faced with this situation, (1^) Some officers had been involved in the Djakarta demonstrations, and something would have to be done to prevent a repetition of the affair, (2) The second group of officers in the provinces, who were rebelling against the” tactics of their superiors in Djakarta, would have to be restrained irom taking matters in their own hands. The Government statement of November 22 was aimed at meeting the first part of the problem. The officers who had taken part in the demonstrations were hit hard. The Army had been "participating in the political field, " tiie statement charged. It added: "The Government does not intend to acquiesce in transgression of the limits of military duty, and will take appropriate measures wherever violations have occurred, " It declared; "The Government deems it necessary to stress that it cannot agree to participation of some officers and members of the Armed Forces in staging the demonstration, , ,,It cannot approve the Army commanders' demands for the dissolution of Parliament, which action was clearly participation of the Army in the political field, " Finally, the - 12 - Government promised to "do its best to restore integrity and unity in the Armed Forces, and continue to work for improvements. ..." Following tlie "relief" of the South Sumatra Commander by Lieutenant- Colonel Kretarto November 23, the Government called back the popular former commander of the South Sumatra area. Colonel Bambang Utojo, from retirement and reapoointed him to his old position. But it declared emphatically that "individual acts or steps being taken in the districts " would no longer be toleratel. Lieutenant-Colonel Kretarto promptly yielded command of the Army in South Sumatra to Colonel Utojo. In the United States, the Washington Post commented on November 24: "The Indonesian cabinet is to be congratulated on the warning it has issued to the militarists v/ho seem to be hankering for political power in Indonesia. . . . The cabinet has told the military in blunt terms tliat such political activity in the armed forces will not be tolerated. If the people of Indonesia value their freedom, they will give strong backing to this policy and to tlie principle of civilian control behind it. " End of the Affair It was announced December 6 that the Chief of Staff of the Indonesian Army, Colonel Nasution, had been relieved of his duties. The move was termed, "the first in a series of measures to implement the Government's declaration of November 22. " A number of other officers were also relieved, presumably for the same reason -- complicity in the Djakarta demonstrations. To replace Colonel Nasution, the Government chose an officer acceptable to both Army factions who at the same time had a mind and a strong reputation of his own. This was Colonel Bambang Sugeng, former Commander of the East Java Division, He had distinguished himself by restoring peace and order in East Java in the months after the transfer of sovereignty. In 1948 he had been active in the campaign to put down the Communist insurrection at Madiun, Colonel Sugeng's job was to bring the opposing groups of officers together and restore discipline. The assignment would require tact as well as strength. Under the circumstances there would have to be compromises, and the Army's new chief could expect pressures from both factions, as well as political pressures and newspaper criticism. After conferences in the areas of troubled military discipline (East Java and Makassar in Celebes) Colonel Sugeng decided to appoint Lieutenant-Colonel Warouw head of the Seventh Territorial Division based at klakassar. Colonel Gatot Subroto, whom Warouw had deposed, had previously declined the command and requested retirement. The appointment of Warouw was strongly protested by the Defense Minister, The Sultan felt that it gave "the impression that the Government has only accepted a fait accompli. " V/hen the Cabinet backed the appointment, he resigned. Premier Wilopo eventually took over the portfolio of Defense Minister ad interim. i I i ■' < i i' r -13- The appointment of Lieutenant-Colonel Warouw may have been militarily appropriate and realistic, but the Army had also to function in a political milieu. An important power in the Government coalition, the Socialist Party, seemed to be on the verge of withdrawing from the Cabinet in protest against (a) the resignation of the Sultan (W the appointment of Warouw. In order to compromise, the Government decided to place Colonel Sadikin, former commander of the Sixth Territorial Division in Borneo, in command of the Seventh Division, over Warouw, This was enough to make Colonel Bambang Sugeng submit his resignation for a few days early in January, But the Government declined to accept it. On January 9 he presided over a meeting of the Territorial Division Commanders. He said the talks went smoothly. He called the meeting "a routine gathering at v/hich the budget was the main subject'^ Three days later he announced that, in response to an appeal from the regional commanders, he would stay at his post. The Army’s troubles were gradually brought under control. V. THE BUDGET AND ELECTION BILLS Parliament reconvened November 27, after a recess of one month and ten days. The members had a great deal to accomplish in the weeks to come. Addressing 170 legislators, Premier Wilopo and the Cabinet ministers, and a packed gallery, Chairman Sartono declared tiiat there were no fewer than ten major draft bills to be considered. The tv/o most important legislative packages covered (1) the 1953 budget, and (2) Indonesia's first general elections, scheduled for late 1^53 or early 1954, In a broad hint to the lawmakers. Dr. Sartono remarked that there v/as little need for lengthy debate on the elections bill. It had been carefully worked out in committee, he said. The Budget Deficit The budget was a serious problem. The national budget for 1952 was approaching the early estimate of four billion rupialis. According to Finance Minister Dr, Sumitro Djojohadikusumo, tlie deficit was a result in part of lower international prices for Indonesian exports. There had also been a decline in the nation's ej^orts until October, when they had begun to rise again. Finally, the Finance Minister pointed out, tlie Government had laid out sizable expendi- tures for reconstruction in recent years. Dr, Sumitro told the daily PemandanHi that the 1953 budget deficit would have to be limited to a maximum of I 1/2 billion rupiahs. This would be difficult, he said, but the Government intended to bring down its expenses through an over -all program of cost-cutting and curtailment of administrative expenses. The Government would also limit Indonesia's purchases in foreign countries. The General Elections Bill The Wilopo Government began early to make good on its promise to speed up preparations for Indonesia's first general elections. It was announced November 18 that more than half of 50 million registration cards had been printed ahead of schedule. Planes and ships were carrying the registration cards > • . ! ; : . .,;r ; ■>. .i. . ii':' .. v'’" •: ' i- ; ; I'l:. ''V - ' ^ A V ; j „ ; !i/v •I/: '■ ‘v' . 'I.'-' .i A -Ji-y.-jja Vii. • 3 ■' .-iir-’ ^ 0,1 • 100 ;^ ..o, .!<’■; / ri-V. W: '■. Jo Ol O' J ; ' . OfiAO-i ..'‘j.!';. v; I'oooO :.•■■ '.‘.i.Oy J,i.; > i. V ' ' ■ o'-- ’t; :-^ul ■:■'■-■ v-i!'/' /. '• "•'c;; ox o. 0 . - O- ■ ,’f ' * I. j'.l' ■ . - 1. -14- to outlying areas of eastern Indonesia and the Lesser Sundas Islands. Home Affairs Minister Dr. Mohamad Roem and Justice Minister Lukman Wiriadinata had completed the draft bill for the election of (a) a Constituent Assembly and (b) a constitutional Parliament. The elections, Dr, Roem said, would be 'direct, free, and secret, " In December, Parliament began deliberating the measijire. VI. FOREIGN RELATIONS: AUGUST - DECEMBER. 1952 Indonesian diplomats distinguished themselves in the latter part of 1952 by carrying on a consistently vigorous effort to promote world peace. This v/as done on the floor of the United Nations, and in numerous behind-the-scenes conferences with representa.tives of other countries. The independent foreign policy also put the Republic in strong opposition to colonialism. Thus, Indonesia supported the independence movements in Morocco and Tunis, backed Egsrt in its differences with Great Britain, The nation's press and political leaders called on France to recognize the national aspirations of the people of Indo-China. Indonesia and Holland Relations between Indonesia and the Netherlands, excellent in some respects, continued to be affected by the tliree -year -old dispute over West Irian. There seemed little likelihood that the situation would change in the immediate future. Professor Kernkarnp, Minister of the Union and the Overseas Territories, declared that the Netlierlands intended to retain its position in the disputed territory. The Dutch -language daily Nieuv/sgier of Djakarta said: "It can be expected that the Indonesian people will look for otiier ways to realize their national claim. In the Netherlands, people might think that the Netherlands Government policy is a good policy, but Netherlanders in Indonesia call it a calamity, " U. N. Hears Indonesia Protest Netherlands Action on Irian In an address before the Fourth Committee of the United Nations General Assembly October 21, Indonesian Ambassador to the United States Dr. Ali Sastroamidjojo protested the submission of a Netherlands Govermr-ent report to the U. N. on tiis administration of West L-ian (New Guinea). He pointed out that Indonesians consider V/est Irian part of the Republic, and believe the Dutch occupation of the disputed territory to be illegal, "Historically, politically and legally, " the Ambassador said, "Irian has always been part and parcel of Indonesia, and it is only because of the unwilling- ness of the Netherlands Government to cease its unlawful occupation of the territory that it is prevented from enjo^nng the status of independence with other parts of Indonesia. " He said West Irian did not come under the category of a non-self-govern- ing territory, and Indonesia could not agree to its being listed as such in official United Nations documents, "First and foremost, my Government -15- wishes to go on record as reserving all its rights, claims, and interests in the only remaining part of Indonesia which is still under colonial rule, " the Am.bassador emphasized. Dr, Ali placed before the Committee a sequence of proofs backing the Indonesian claim to West Irian. He cited the wording of the Netherlands Constitution prior to the transfer of sovereignty: "The Kingdom of the Netherlands consists of the territories of the Netherlands, Indonesia, Surinam, and the Netherlands Antilles, " No mention is made here of a separate entity known as "New Guinea". It is included in the "Indonesia" category. Secondly, Dr. Ali pointed to Article 1 of the Charter of the Transfer of Sovereignty in which it was agreed that the Netherlands "unconditionally and irrevocably transfers complete sovereignty over Indonesia to the Republic of the United States of Indonesia and thereby recognizes said Republic of the United States of Indonesia as an independent and sovereign state, " Putting these two paragraphs together, it becam.e clear that Indonesia was entitled to sovereignty over the disputed territory, the Amibassador indicated. With regard to the dispute itself, as formalized in the U. N, - sponsored Round Table Conference agreement, he quoted this paragraph: "... .the status quo of the residency of New Guinea shall be maintained with the stipulation that, within a year from the date of transfer of sovereignty to the Republic of the United States of Indonesia,, the question of the political status of New Guinea be determined tlircugh negotiations between the Republic of the United States of Indonesia and the Kingdom of the Netherlands. " Here the Indonesian delegate made two vital points. First, the agreement to arbitrate the dispute over West Irian was "ine:dricably interwoven" with Article 1 of the Transfer of Sovereignty. Secondly, he said, "It is clearly evident -- and I wish to em.phasize this -- that no specific provision has been cfiyen here to the effect tliat sovereicfnty over Irian shall be assigned to the Netherlands in the event of failure to reach agreement on the status of the territory , if that were the case, as has been repeatedly maintained by the Dutch Government, "he went on, "it wo^old be tantamount to inviting the Dutch Government to frustrate from the outset all negotiations, " Dr. Ali told the Committee that the only possible interpretation could be that the status of the territory was still in dispute, and should be resolved, by negotiation and otiier peaceful means. As things stood now, Indonesia no longer consented to the continuation of the exercise of authority by the Netherlands in West Irian, "Consequently, after the formal withdrawal of the consent of my Government tliereto, the continuance of the exercise of authority by the Netherlands has no longer any legal foundation, " A Dutch Economist Testifies . . . The naming of West Irian (New Guinea) as one of Indonesia's proposed sixteen electoral districts was further evidence that the Republic had no 1 . -16- intention of placing the Indonesian -Netherlands dispute over that territory "in the ice box. " The Netherlands v/as nevertheless going ahead with its own plans for West Irian as though no disagreement existed. Were such tactics realistic and practical? The Dutch economist J.W.H, Leslie Miller did not think so. In a thesis -- "The Economic Aspect of the West Irian Problem" -- delivered at the University of Utrecht, he declared that Holland faced economic hardship in West Irian and loss of trade with Indonesia, if it persisted in the effort to exploit the territory's resources on its own. According to the Times of Indonesia, Mr. Leslie I^Iiller based his thesis partly on his own observations when he was a governm.ent employee in West Irian, He said that the value of the territory’s natural resources was still dubious, and that the capital and labor power to develop the region was "surely" lacking. Labor was the big factor. There were not enough workers in the area to be employed in western estates and enterprises. And Western labor would not be able to work under the conditions imposed by West Irian’s unfavorable climate. The supply of "cheap labor" from China was, of course, no longer available^ Leslie Miller said, and Japanese labor was "to be feared. " He considered the attem.pted colonization of tlie area by Indo-Europeans to be a failure. He added: "Before the constitutional status of West Irian is clear neither Dutchmen nor Indo-Europeans should be encouraged to move to this area, " Indonesian labor was the answer. But obviously the Republic would not permit its nationals to work in V/est Irian under present circumstances. The Dutch themselves would fear an Indonesian "influx" there, Leslie Miller urged that the Netherlands Government seek an agreement with Indonesia on governing West Irian "which will be advantageous to all concerned and which will bring prosperity, " the Times of Indonesia reported, Indonesia and Japan At the end of a one-v/eek conference the Indonesian Chamber of Commerce and the visiting Japanese Economic Good Will Mission released a joint state- ment November 24 stressing the desirability of Indonesian and Japanese enterprise working together in the interests of (_1) helping to develop Indonesia's national economy and (2) aiding Japanese economic reconstruction. Both delegations "firmly believed " that economic relations between the two countries should be based on "mutual benefits, " The Conference acknowledged its "limited effectiveness ", since diplomatic relations between the Indonesian and Japanese Governments as yet have no exact form, (NOTE: Indonesia's form,er Foreign Minister Dr, Achmad Subardjo signed the Japanese Peace Treaty at San Francisco, but the pact has not been ratified by the Indonesian Parliament, Early in 1952Indonesian and Japanese delegations worked out a separate interim reparations agreement, but this also has not been ratified, ) The Conference studied questions of shipping, system of payment, and other matters hampering a steady flow of commerce. Basically trade will be • r - 1 V ( f . ""T V.. i -17- in the form of Indonesian raw material exports for Japanese industry, and imports of capital goods and equipment for the industrialization of Indonesia. Japanese technical assistance for Indonesia and the training of Indonesian personnel in Japan was also the subject of lengthy discussion at the Conference, Indonesia and West Germany Following his two-month visit to West Germany, Dr, Asmaun, chief of the Economic Affairs Ministry’s foreign trade department, revealed that a V/est German trade mission would come to Indonesia shortly to negotiate a renewel of the trade agreement between Indonesia and West Germany, Dr. Asmaun went to West Germany to explore the possibilities of expanding trade between the two countries. There were definite opportunities for building up trade with West Germany, the Economic Affairs Ministry official said. He noted, however, that "difficulties regarding payments should not be ignored. " He pointed out that Indonesia needed money to pay for its imports from West Germany. Credits might not be available, since Germany’s "capabilities in this field are also limited. " Dr, Asmaun emphasized the importance of the West German trade mission’s impending visit to Indonesia, as an aid, among other things, in settling the payments question. Indonesia in the United Nations Indonesia reaffirmed her faith in the U, N. October 24 in ceremonies marking United Nations Day. In an address. Premier Wilopo declared that the very existence of human society depended on continuous international cooperation. The United Nations, he said, "is the most pov/erful machinery for peace ever devised. " The resident representative of the U. N, Technical Assistance Organizaticn in Indonesia, John 3, Reid, commented: "VJhereas in the beginning of the United Nations there was pessimism and cynicism as regards the world body, today a healthier state prevails, . . .Since the admission of the Republic into the United Nations Indonesia has taken a courageous and progressive stand on all issues. That promises w'ell for the health of the United Nations and for the people and prosperity of the world, " Some of the nation's top-ra,nking officials headed the Indonesian delegation to the session of the U. N, General Assembly beginning in November. Among the Republic's representatives were Foreign Affairs Minister Moekarto Notowidigdo; Mr. L.N, Palar, permanent delegate at the U.N, ; Ambassador to the United States Dr, Ali Sastroamidiojo; Dr, Abu Hanifah, chief of the Foreign Affairs Ministry's U.N. and U. S. Department, and Dr, Sutan Hamid Rasjid, head of the Political Department, The Republic's View of the Trusteeship Problem Speaking before the United Nations General Assembly's Fourth Committee November 24, Dr, Ali Sastroamidjojo called for a re-examination of the I I •• nl:i ^ ■ . "flM ' : A , t{&85‘£- ■ M os I. K •Li • \ r i,: ." OAiC. J. • " V 1 -18- Trusteeship Council’s approach to the whole Trusteeship problem, and at the same time pointed the way to positive help for preparing the people in trust territories for independence by offering a group of six fellowships financed by the Indonesian government. Four of the fellowships will provide for study in Indonesia of such subjects as Adat or Customary Law, Social Anthropology, Archeology and the Indonesian Language. Two of the fellowships will be for study anywhere outside Indonesia in technical and social -economic fields. The Ambassador noted that such nations as Burma, India, Indonesia, Palcistan and the Philippines are "in the position of being able to bring to the United Nations the most recent testimony, that colonialism, nowever enlightened it may be made to appear today, is no substitute for self-government or independence, " The Ambassador said that if these countries appear "at times to be impatient with the pace of development in tlie trust territories, it is onlybecause of our awareness of the impatient feeling of the dependent peoples themselves in their desire for self-government or independence. History has shown that once this desire begins to grow, it will not wait for perfection to be achieved in economic development, education, or for that matter? anything else. It would be a fatal error to suppose that after a certain point, the desire of a people to manage their own affairs can be greatly postponed simply by telling them they are not yet mature enough to do so. . .Tne extent to which material progress keeps pace with the desire for freedom is the crucial test of the International Trusteeship System and of colonialism itself, " Criticising the trusteeship procedures, the Ambassador declared, "I cannot see why it is impossible for any of the Administering Authorities to draw up development plans incorporating a time table for the eventual self- governmient or independence of their Trust Territories, Be it five, ten or twenty five years, it will in all cases nave a salutory effect on the indigenous inhabitants of the Trust territories inasmuch as it opens to them the horizon of their independence, " He also reminded the delegates tiiat "without national- ism, none of us would be sitting around this table. " The Ambassador emphasized. ", ... I cannot lay enough stress on the necessity of giving tne indigenous inhabitants of tlie Trust Territories the opportunity of obtaining managerial skill and technical know-how by promoting their participation in the productive process of tiie Territories concerned, " VII. MR, MOEKARTO: U.N. NEEDS "REBIRTH OF ENLIGHTENED REALISM" In a major address before the plenary session of the General Assembly November 11, Foreign Affairs Minister Moekarto warned the assembled dele- gates that the "new spirit (of) realistic idealism or enlightened realism" that animated the cliarter members of tie U.N. at San Francisco was, it seemed, 'fleeting, " He noted: "We are filled with great anxiety, sometimes even with a sense of frustration, " The Foreign Minister was outspoken in expressing Indonesia's concern over the change in the spirit of the U. N, "It is difficult, " he said, "to recapture today the sense of hope and optimistic expectation wnich this organization at its incepcion inspired among tae submerged peoples of the world who foresaw a - 19 - rapid end of political domination, economic exploitation, social degradation and cultural frustration. "Despite sincere and repeated affirmations by representatives of sixty nations. . . .of the continued desire of their peoples for peace and the oppor- tunities for self-fulfillment for all, the Charter is often appealed to in vain; the implementation of many of its provisions is notable for its absence in ma ny parts of the world; otrier provisions have been interpreted in what amounts to a distortion of their original intention. We still hear reiteration of the noble phrases and sentiments first voiced seven years ago, but their continued repetition in a near vacuum, of action gives them, at times, the unreality of the Cheshire Cat's smile, "l\,ir. Moekarto said. Some Notable Successes Tlie head of Indonesia's U. N. Delegation paid tribute to the "notable successes" of the United Nations' special agencies. But, he pointed out, similar agencies of tlie old League of Nations at Geneva also did excellent work. Yet this did not ensure the survival of the League or prevent World War II. If -- "although v/e are reluctant to admit it" — the U. N. showed signs of deteriorating like its predecessor, it was because "it is attempting to function in the midst of a retrogression to tiie very power conflicts and alliances it was set up to supersede, he empnasized. Mr. Moekarto then declared: "Two hostile blocs led by two nations who were most instru- mental in the creation of this Organization now face each other across a barrier which neither can bring itself to bridge. One result is that basic action em/isaged by the Charter, such as disarmament, has been constantly thwarted. We witness instead an armamants race vaster and more terrifying then anything that has gone before. And the large powers, ignoring the principle which gave them their added special privileges within the organization, use these privileges to further their own ends v/hile failing in carrying out tlieir responsibilities to exercise their power jointly and cooperatively to further the aims of the Charter. They play their game of chess on the board of the United Nations, constantly seeking to checkmate each otlier. And the smaller nations who become the pawns in this game are e::pected to do little more than deplore and exliOrt. " The Cold War The Indonesian statesman reminded the delegates that almost every issue corning before the U, N. was being dragged into the context of the cold war , "Fev/er and fev/er have become the debates on the merits of the problem discussion, "^he said, "More and more has the cold war cast its baneful shadoy/ over the deliberations of this Organiza-tion, It would be almost comic, were it not so tragic, to see how accurately can be predicted the positions of many countries on a given issue on the basis of their situation vis-a-vis the so-called East-West conflict. - 20 - "In this atmosphere v/here it is apparently no longer fashionable to analyze issues on their merits and strictly in accordance with the Charter, Indonesia has steadfastly attempted to do so, " he said, Puecalling that Indonesia^ independent policy -- declining to align itself witli either bloc -- had been termed unrealistic, IJlr, Moekarto asked: "Is not the abdication by the big powers of responsibility to preserve peace and security more unrealistic? Is not the sacrifice of genuine issues upon the altar of the cold war the height of uiirealisrn? " Indonesia*s Objectives Turning to Indonesia's role in tiie U. N, , Mr, Moekarto outlined the Republic’s objectives in the current session of the General Assembly; "V/e intend to contribute our utmost toward attaining the peaceful unification of Korea, " Indonesia will work for a rapid solution to the im.passe blocking the admission of various countries to the U, N, "We deplore to see applicants refused admission because either power bloc has suspected that they might support the other. " ", , , . We firmly intend to assert, in common v/ith other Asian and Arab nations, tlie questions of Tunis and Morocco. " ".,..We will continue to press for concrete action on the policy of apartiieid pursued by the Union of South zlfrica, " The Foreign Affairs Minister said tidonesia looked forward "with great optimism" to continued action in the sphere of economic development. He praised the v;ork of UNICEF, WHQICflO and the other specialized agencies of the U, N, He said the job they had done in Indonesia had given "visible evidence to our people that this Organization is still a living entity fulfilling part of the promise of the Charter. " Technical and economic assistance alone v/ould not enable the under- developed countries to achieve balanced economies, he said. Consequently these countries have "advocated a more com.prehensive international approach to the financing of economic development and the creation of additional inter- national institutions for its application, " Mr. Moekarto concluded: The United Nations' Task "A realistic solution of both tlie economic and political issues facing this Assembly requires a re -birth of the spirit of enlightened realism which attended the birth of this Organization, , . . Time itself challenges the members of this Assembly to observe tlie principles of the Charter faithfully; to view each issue brought to their attention on its merits strictly in relation to the Charter; to show as fervent devotion to its observance nearer home as they show concern for its violation at a distance; to endeavour to remove the impediments to self determination and the enjoyment of basic hum.an rights with conviction and # In- •; i . f - 21 - v/ithout evasion; to rearm for a war against poverty, starvation and disease instead of for a military v/ar against each other; to do these things not only with words and speeches but v/ith deeds and actions. For the measure of the desire for peace is not what one says about it, but v/hat one does to attain it, " Vm. MIDYEAR ROUND-UP Foreicm Relations Unofficial reports from Djakarta December 13 said Indonesia had arrived at an agreement "in principle" with the United States on a new plan covering American economic assistance to the Pvepublic, The new arrangement would replace the MSA pact under which Indonesia was to receive $8, 000, 000 worth of aid from the United States, Former Foreign Minister Dr, Achm.ad Subardjc declared November 20 that his "roving mission" to the countries of the Middle East had been a success. He saw "new prospects for closer cooperation between Indonesia and the Middle East nations in political, economic, and cultural matters, " Ambassador and Madame Ali Sastroamidjojo flew to Mexico City November 27. Dr, Ali represented the Republic of Indonesia at the December 1 inaugural of Mexico's new President, Adolfo Ruiz Cortines, hir, Abdoel Hamid, the Republic's first Consul at San Francisco, arrived in that city September 6, The other Indonesian Consular office in the United States is its Consulate General in New York, Economic Nev/s In an advance release of the budget figures to be submitted to Parliament, Finance Minister Dr, Sumitro Djojohadikusumo disclosed that Indonesia's 1953 budget would show a deficit of 1, 794 billion rupiahs. This was about two billion rupiahs less than the 1952 deficit. The estimated state income for 1953 was 7. 296 billion rupiahs, as opposed to the 1952 income of 11,750 billion, (NOTE: The Government encouraged private business in Indonesia by abolishing the Foreign Exchange Certificate system earlier in 1952. This move cost the state • approximately tv/o billion rupiahs in revenues. The new "inducement" system made up only about 700 million rupiahs of this am.ount. Another factor in reducing state revenues v/as the substantial cut in income tax rates retroactive to January 1, 1952. ) In 1953, there would be a significant curtailment of Government spending in Indonesia, Dr, Sumitro indicated. The 1952 outlay was 2,861 billion rupiahs. Expenditures would come to 1,747 billion in 1953 -- a slash of nearly one-third. Despite the reduction of state income, Indonesia would continue to place emphasis on its national reconstruction program, the Finance Minister said, A new dam was officially opened in the second week of October at Lebak •I'o -.B- ■ f-imi no’V; •■■..'•vs. '-j'; ..i' ■= .1 • V, .i '.* •>:* frv* O'- cv* ,•■:•■»!»••> •.'-.'jl' .•^nx£;-- ri:- ■’:•,•.? £ :;...j •!' • . f ~’J 10‘*J . .;D i'Mv; ti=d •:. • Oi .rh'ivj; i>i w,>'. ;/> j:'Oris . f «V» jr.r- • ■ ‘ : . . , t •".V ; ^ A: . - ■• '.-ii.' 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' p /:'ip ;.;:• ••.••£’'iJjO. ••;;■•'■' • *.‘i''T M-ATOi j i;-K:cL;.’jv;dV ' Or!: ;„pir’ i, •■•'Q .-p V'. 'U . ’ . ■ f- •>.:» rr*. • ^ .'• ■■ ..... ,.i #•, V .•, • . ^ •■. . ( • ', ’ r j'T' H ‘S' •'■f, > r ’- v’ir^P ^ ■ ■•: i'r:.'" -•Acid i.:r-; ... f.jr-d /p; tb.d - w-'.J’ - ;.• io 'ir '/<: ' 'C-'.*'n/ -: '; .I;-'' {. .' ' \S>;< ; i,.. ' ^ .1 ■ .. '•■■■ -■ ■ -d t AJ': -/ . -bP' • . ‘;..l .f'...'.- . ; . Ci'i- .‘■u: :. .•••:;J- V .y 'u' ■ *..J ^ } /■ • Ju* '.< V, , L»r -,r .iVrd'.Pt; ;•••’ • .x;d. . ■■- v-dQ-f ‘il Pol!- :d .i Pltvdi , . kl'l'-l «* 1 ■ •- K* •• , < » . » * ^ f • » *. * « k.. • J •.:;•?••• HP i’.’r*:Ma}x15 j • .v-;A P.H. :>'• r:; f* t'/ ' • * ,1S 'S ■jT fur-, ’ dfTHV ■' .cjj fj; Iccsj^-fK. *r,UT:H'i.r:; Cijv/ vp^' ..H'C . i - 22 - Tana h Mas in the lowlands of South Sumatra, The 218,000 - rupiah dam, financed by the Agricultural Ministry will help control floods and draughts over an area of 500 hectares. Five per cent of the area had been affected annually by flood and draught. Every four or five years the damage came to 25% of the output. In his address, the Governor of South Sumatra said he hoped the province would be able to supply its own rice requirements "very soon. " At present South Sumatra has to import about 50, 000 tons a year. News from Indonesia in November told of increased sugar production. Agriculture Minister Mohamad Sardjan was quoted, as sa3ring that Indonesia might export 60 to 70 thousand tons of refined sugar this year, as opposed to only 6, 000 tons in 1951, Next year, he predicted, the figure would reach 200 thousand tons. He attributed the increase to an improvement in security conditions, harder work, and the wider use of modern machinery. A new plant manufacturing toothpaste tubes was opened early in December at Surabaja. Its capacity was 20, 000 tubes a day. This output was to be considerably increased in 1953, Plans to build a penicillin factory in Djakarta were completed by the Ministry of Health, The factotry, to cost thirty-five million rupiahs, will be ready in 1954 and will include central godowns for the Ministry of Health and a modern laboratory. Djakarta's English-language daily Times of Indonesia published an extract from the Java Bank's abridged balance sheet of November 12 to provide a snapshot of Indonesia's financial condition. As of that day the nation had an adverse trade balance amounting to 729 million rupiahs. The amount of paper money in circulation had reached a figure of 4, 075 million rupiahs, A gold re serve of 1, 062 million rupiahs provided a coverage of 25%, Java Bank loans to the Government totalled 3, 553 million rupiahs. Date Money in Circulation January 1, 1950 ] Rp 1, 92C million Deqember 27, 1950 2,771 December 31, 1960 -- January 3, 1951 2,818 December 3J, 1951 3, 411 November 12, 1952 4,075 Foreicm Exchange Gold Reserve minus Rp 791 million Rp 471 million or Rp 575 " new rate plus Rp 223 million Rp 791 million plus Rp 222 Rp 1,060 million minus Rp 729 Rp 1,062 million Education The Semarang daily Kedaulatan Rakiat reported that Gadjah Mada University In J ogj^ak^ta had an enrollment in 1955 of 4, 457 students. The law faculty and the schools of social, economic and political science had a total of 2, 064 students '/i rJ it » \ * t- ■'0 .. yurjJ U- -^1 f. V f» I » . ( i u. ■ Xf i i - 'Kf * 1 / ‘ ■ r ) ; :* ? •*» ♦ O ' I * , 7 n / .♦•1 r ' t "':,. ' I -23- including 247 women. The medical, dental and pharmacy schools enrolled 794, with 154 women. There were only 33 women among the 760 students at the university's technical school, but in the faculty of the arts, education, and philosophy they comprised more than a quarter of the student body, 187 out of 461 students, Gadjah Mada's agricultural school was attended by 325 students, with five women. The government of West Germany presented a selection of textbooks to the Education Ministry. They were to be used in elementary, secondary, and university courses. The Republic's Sixtii Agricultural College was opened at Medan, East Sumatra September 1 by Gunung Usicandar, secretary-general of the Ministry of Agriculture, Like all new schools in Indonesia, the Medan institution had many more applicants than it was possible to accept. Out of 500 applicants, fifty were selected for the first course. WHO in Indonesia On the eve of the Southeast Asia WHO ( World Health Organization ) Con- ference beginning September 3 in Bandung, Dr," Mani, 'chief of V/HO, disclosed the following achievements of the U,N, agency in Indonesia during the past two years, (^) In the anti-framboesia (yav/s) campaign, WHO's specially trained teams have ministered to 400,000 patients and examined 2 1/2 million persons, (y Two WHO experts are attached to the Djakarta Food Institute, which is now being expanded, (c) V/HO is assisting the Indonesian Government in an experi- mental anti-malarial campaign featuring the use of DDT. The organization is carrying out a program to*^establish welfare centers and train Indonesian cadres to operate them, (e) The Bandung Training Center for the fight against TB is being set up with the advice and assistance of WHO, (f) Nineteen WHO fellowships have been awarded to Indonesian doctors and health workers enabling them to receive advanced training abroad. Congress of Indonesian Doctors Indonesia must have m.ore medical doctors, and soon, the congress of the Indonesian Doctor's Association was told in mid -December by Dr, Suharto of the organization's policy-making central committee. More than one hundred doctors, public health officials, and professors from Indonesia's miedical schools attended the Bandung meeting. Dr. Suharto told the congress that there were no more than 1, 400 physicians in all of Indonesia, About one-quarter of this number were foreign doctors. No more than half of the physicians were in Government service. This added up to one doctor for every 50 - 60 thousand persons in Indonesia, and one Government doctor for every 100, 000 - 120, 000, Most of the 1,400 Indonesian doctors had been practicing for more than ten years, Dr, Suharto pointed out. Assuming a normal death rate, there should be at least 110 new doctors graduated every year from Indonesia's medical schools, he said. But this would only be enough to maintain the present unsatisfactory state of affairs. The medical schools were currently able to turn out a maximum of 35 to 60 graduates per year. Hence, something v/ould have to be done. ^ "Let us not speak of one doctor for every tliousand inhabitants for the 1 -24- coming generation. This figure is often considered an international standard. But if we wish (even) to have one doctor for every 30, 000 inhabitants in 1962 we should need to turn out 200 new doctors every year from now on, " Dr, Suharto declared. He suggested one solution; if Indonesia lacked the facilities for training doctors, students should be sent abroad for undergraduate as well as graduate study. He thought all medical students should have scholarships. He v/anted to see the period of medical study shortened. "The present system of medical education in Indonesia is a copy of the Netherlands system, " he said. "The Dutch system is good, but it is a luxury for Indonesia today, for this country faces difficulties in following the system, while at the same time it needs many doctors, " Dr, Suharto approved the Governmient's policy of trying to obtain foreign doctors for Indonesia. He agreed that it would be reasonable to pay them high salaries. But these salaries should not be a great deal larger than those of Indonesian doctors. He g).oke of a surplus of doctors in the Philippines, and wondered why some of them had not been attracted to Indonesia. He gave the central committee's program for increasing the number of doctors in Indonesia: 1, A state commission should be appointed. It v/ould have five members, representing (a) the Health Ministry (b) the Education Ministry (c) the University of Indonesia and Gadjah Mada University (6) Parliament (_e) the central coramhttee of the Doctor's Association. 2, This commission would try to work out a method of shortening the period of medical study, 3, It would work out a plan for setting up medical faculty cadres to be trained in Indonesia and abroad. 4, It would study "the position of foreign doctors in Indonesia. " 5, It would set up a means of controlling (_a) standards of medical education in Indonesia, and (jy the conduct of doctors in the exercise of their medical duties. In another address to the congress. Health Minister Dr. J. Leimena called on the nation's doctors to set an example to tlie Indonesian people during "the most crucial period in Indonesian history, " He said there must be a "sound understanding" between the doctors and society, "The anti-malarial campaii^ is only one of the many examples of the manner in which modern scientific methods might be of great use in the interest of the people, " he declared, "I have said more than once; give us time, personnel and equipment, and we will do the job. " ^ r , Dancers of Bali x: 4 .U event of the American theater season was the nation-wide tour 01 the first company of dancers and singers from the island of Bali ever to > * ♦ ’ t r . i t V t -25- perform in the United States, The group of 45 artists, including a complete gamelan orchestra, was flown to the United States from Bali, The New York engagement, originally scheduled for four weeks, was extended to nearly three months. The troupe performed in Boston, Washington, Chicago, Cincinnati, Cleveland, Los Angeles, San Francisco and many other cities. The New York critics gave the Dancers of Bali enthusiastic reviev/s, John Martin of the Times called the show "beautiful, gorgeous to look at, stun- ning to listen to, full of vivacity and completely off the beaten track. " Herald Tribune critic Walter Terry saw "beauty everywhere. Beauty of movement and beauty of sound, beauty of color and beauty of spirit. " Robert Colemen of the daily Mirror wrote: "A visit to the Fulton (Theater) is imperative for those who v/ish to enlarge their artistic horizons, " IX. PROGRAM FOR THE NEW YEAR Indonesia’s leaders and its people looked into 1953 with confidence that the Republic's fortunes would improve steadily in the months to come. Econom- ically, 1952 had not been a good year. In other respects, notably on the fronts of education and medicine, the country made strong gains. There was a four- billion-rupiali deficit for the year that would necessitate slashes in Government spending during 1953. On the other hand, more roads were being built, more dams, irrigation systems, and bridges were under construction than ever before. More children were going to school. Dramatic progress in the literacy drive was revealed by Government statistics. They showed that 25% of the Fidonesian people could nov/ read and write,* Unofficial reports said the figure was about 46 ^ In a m^essage to Parliament, Finance Minister Dr, Sumitro Djojohadikusumo told the legislators what the Government would try to accomplish in 1953, He listed the top priorities (apart from, the election), with emphasis on national reconstruction; 1. Increase food production, 2. Build new roads and repair old ones. 3. Develop local Indonesian industries. 4. Continue the transmigration program, redistributing the population from over -crowded Java to "pioneer" areas of Sumatra, Borneo, and Celebes, 5. Stepping up the education program, with emphasis on the literacy drive. ^ The Finance Minister noted that since 1951 Indonesia's economic position had been affected by a decline in the prices of its exports on the world market. The nation's basis for economic development was still narrow, he said. It was estimated that the Governmient had spent about 17, 562, 895, 000, rupiahs in 1952, Dr, Sumitro went on. For 1953, expenditures were expected * At the end of the colonial period in 1945 only 6% of the Indonesian people were literate. -26- to be cut by more than four billion rupiahs to about 13, 216, 096, 000. Defense was the main item on both budgets — nearly four billion rupiahs in 1952, nearly three billion for the coming year. He gave the estimated budget deficit for 1952 as 4, 326, 969, 000, and for 1953, 1, 793, 985, 000 rupiahs. President Soekarno Speaks at Parliament Opening Parliament reopened January 8. Members of the diplomatic corps observed the proceedings, as 141 members of the national legislative body heard President Soekarno urge the Indonesian people to make greater sacrifices to build up their nation. Independence brought wi& it great respensibility, he said. Freedom would endure and have real meaning o^y if everyone exerted himself to the fullest every working day, hour, and minute to make Indonesia strong -- even if it took several generations to complete the task, the President declared. He added: "A state does not come into existence merely by being proclaimed. ” The chief of state expressed satisfaction in the Republic's independent foreign policy. He approved particularly the support Indonesia has given "colonial and semi-colonial countries" in their fight for freedom. These and other foreign -policy activities "are in harmony with her obligations to the community of nations and her own national interests, " he said, as quoted by Radio Indonesia. He noted that Indonesia now had 37 diplomatic missions in foreign countries, including the new legations in Italy and. West Germany. He revealed that Indonesia and the United States had reached an aid agreement to take the place of the Mutual Security Aid (MSA) pact of January, 1952. Always in the forefront of the West Irian dispute, President Soekarno once again emphasized Indonesia's determination to "continue the struggle for facto inclusion of West Irian in the Republic of Indonesia. " The President emphasized the close cooperation that has been set up among the Asian and African countries within and outside of the framework of the United Nations. "Also, witli other countries, we maintain good cooperation and are strengthening our ties, " he declared, according to Radio Indonesia. Radio Indonesia reported that President Soekarno told Parliament: "The Government is continuing its efforts to democratize regional administration in order to implement, , . .basic principles, . . .contained in our Constitution. " This was a reference to the Government policy of granting a larger share of autonom.y to areas outside Java. He made special mention of the transmiOTation program — the shifting of thousands of Indonesians (on a voluntary basis) from overcrowded Java to sparsely settled areas in Sumatra, Borneo, and Celebes, These settlers were given tracts of land and subsidized by the Government until they could get their enter- prises underway. This "distribution of productive rnanpov/er over the entire Indonesian ^chipelago, " President Soekarno said, "must be connected primarily with the (national) reconstruction effort, " The Government v/ould not slacken in its efforts to encourage kidonesian I • • J V I i V* V. V. J K ■ r*. -27- business. "Action toward the establishment of big and small enterprises will be continued in 1953, " the President said. He was gratified that the Election Bill had been sent to Parliament before the end of 1952, and said he hoped general elections would be held very soon. X. PARLIAMENT PASSES GENERAL ELECTIONS BILL The way to Indonesia’s first general elections was cleared April 1 when Parliament passed the final amendment to the elections bill first submitted by the Government last November. The bill, made up of 133 articles, covers elections to a Constituent Assembly and Parliament, * Home Affairs Minister Dr. Mohamad Roem said that registration of voters would begin in July, and that the elections would be held ten months later. Cost of the forthcoming elections was estimated at 350, 000, 000 rupiahs. In the last week of March the Home Affairs Minister had told the United Press that elections would give the Government the necessary streng^ to carry out a positive program, and would "add stability" to the administration. He said Parliament was trying to work out "a perfect election law". Dr. Roem believed tliere were fifty million eligible voters in the nation out of a total population of about eighty million. The minimum voting age would be 18, he said, except tliat married persons of any age would be permitted to vote.** Women had equal voting rights. The voters would elect abouc 500 representa- tives to the Constituent Assembly and 250 members of Parliament, Dr, Roem said fifty million registration cards had already been printed. Meanwhile the Information Ministry was beginning a drive to make the Indonesian people election-conscious. The ca'mpaign would make use of radio, movies, posters, pamphlets and lectures. The nationa] radio network. Radio Republik fiidonesia, was to be especially active. R,RI had a one -hour program every week devoted to election information. In the months to come, this campaign would be intensified. XI. THE FINANCIAL OUTLOOK Sz ECONOMIC NEWS Finance Minister Dr. Sumitro Djojohadikusumo declared January 16 that Indonesia's imm^ediate financial future depended on (a) the expense -slashing budget policy being carried out (b) "harmonizing" the nation’s monetary policy with its budget requirements (c) particularly important — evolving a labor policy to stimulate productivity. The current Indonesian Parliament is provisional. 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'jrij. :*! pb.- ra«;aoW .-iU J: iO clips bij-r-rrr b/i£ Y-ic(rr5C'.?cU^ jnotd]j:^'£ioD *-aJ oS »bi^'iU'£(i '3c'3j v'biWU’ befi mjijfiiiaipsi .;oIi(irxi villi bl£c. t/ *■ ' I Siiam i>i Dvhb.;: pr iri dpo-i zip^ x'xlzhvKi nolic/frivlnl art? Vs; 90 ! '-pjow arlT ^di'dii.’.nc’S-nolicoIa w-Iqopg asreonobnl orb :vd'i^'£ Vf bijB tvipldqniisq ,e-23ii»q' ,.-'9i''Oirr ,otbii*i ’aKjri- *>pv ;i ‘ Hr? •.pvlipa '^iti!5?cpq^..: .rrd ci aav/ bid iilddvqa*? cfbuH / o.i r.iUi'joc'; ul iitohi-firiolrti iioL>rc-|f‘ oi l9iov >b >b)e*\v vivva ma;rnoiq .bPlii^npJni ac blf.'OW i^d.cqma': si.i3 s ^ht .IX a xif.'Jiu.l lr^'irLc/:ib onx. xitOj/ioicd^ oxiii^'b'i *itj aoftajb^ f?’.-':-: f,:-'- 'r'J (c) no bi-lnpop-; a*rxj;M 5^>rt',l^j5fJ^l fJD«Tfc 9 (Tirrri r.’ijla^npbfil ^arb ' Irr V i ■ -. '•tcjllan &di ♦‘p. i:.-.rno.n to) ijfo b«J iiao pr::pd iarpbLd \ irH-,; ■- t>r. viu'S;g .... inavvxjr^il JU*3!''-j9-iii,-|.9n- ipptid aJx diiv; . /Ji^iv^j-.ybOlq ?ti/dum/ia oi piioq 3-3 ;v . :•...., ..Hi, -II .u-tofamnj -’*'■1 jii^nraii'ic''? xul^tanabnl PxiT ♦ • Irre. ;r- x. .. v-„ v'i poISioPO^ U,oiiii^q as'b b^i;.io(iqiS iiM axro ;: ' o l‘6iixoUdBic& .'•'■'tV-v *'^ vi ' • ■•■ xri/v; iix •»% . rr^VI Xo adpa eHJ ia rvLi ': -:i \ z ik-TT: h ♦♦ .b.o 2i!Ov. ;3c-C.S: 91B -^etu X'-3iiv' -28- Indonesia's foreign currency and gold reserves were estimated by Dr, Sumitro to amount to about 3, 700, OCO, 000 - 4, 000, 000, 000 rupialis. The Republic's total budget deficit was 1, 800, 000, 000 rupiahs. These funds would cover all but 500,000, 000 rupiahs, which would have to be made up by increased production. Dr, Sumitro declared. Capital expenditures accounted for the entire deficit, excepting 131, 000, 000 rupiahs. Of 1952's 4, 000, 000, COO rupiah deficit, capital expendi- tures were responsible for 2, 900, 000, 000 rupiahs. The cost-of- maintenance deficit came to only 137, 000, 000 rupiahs, about one billion less rupiahs than the year before. Dr, Sumitro emphasized that the Government was not going in for mass dismissal of personnel in order to achieve its economies. But costs were to be cut drastically. He said the Government would put an end to the "squandering of material" that had added heavy expenses to the national administration in recent years. An Increase in Imports Indonesia has once again built up a favorable balance of trade, and will issue import licenses up to an amount of two billion rupiahs in the next three months, Java Bank President Dr, Sjafruddin Prawiranegara declared March 12. This amount will include Government as well as private imports, he said. Coming back from a total foreign exchange deficit of 2, 430, 000, 000 rupiahs in 1952, Indonesia had a foreign exchange surplus of 171 million rupiahs in January and 186 million rupialis last month. This two months' surplus was the basis of the Government's decision to increase Indonesian imporls. Dr. Sjafruddin said. Last year, the Java Bank President disclosed, Indonesia's deficit in foreign trade grew from 281 million rupiahs in the first quarter to a 443 million rupiah deficit in the second quarter. The third quarter of 1952 produced a deficit of 1,328,000,000 rupiahs. Restrictive measures held the deficit for the final quarter of the year to 378 million rupiahs. Dr, Sumitro and Mr, Surnanang Tell Parliament,, , Economic .Affairs Minister Sumanang and Finance Minister Dr, Sumitro Djojohadikusumo made statements on the Government's economic and financial policy before an April 1 plenary session of Parliament, Radio Indonesia reports that they answered parliamentary criticism of Government policy with special reference to (D an upward trend in prices, and (2) the import r equations recently put in force, Mr, Sumanang told Parliament that economic and financial problems could not be separated. He said that Indonesia's financial position required further economizing of foreign exchange, and continued restrictions on imports of non-basic goods. He said the Government's economic policy was directed mainly toward safeguarding the supplies and prices of primary goods such as rice, salt, and salted fish. He noted that the Government's price -stabilizing policy had brought about a drop in rice prices, although the prices of other (non-basic and imported) goods had increased. I I « .:Ov: 'itac e-.-'v v* V 7 f i ■ EPru ,*/ ■ . =: 'Of 5 ‘ r:;n) r::*jSl:;c-‘rr<’>l-'Tl ■ O-''. /X>:/ -:• .C teo.:0'iepU;'' '-U‘i;. pn w. «-■ ;J .-.y„{i,;-c -. ;r.. V coo,;';". _J- . iifc , p'i'iAi o iJj i. " .tJ ■ : ; ,n-:il-sb >*J;.T- -'‘i I'-.-iriJ . IV. '■' ' uO , • ■ - ’.*'./.<.v . ,' .r-.;;'.'.; ^'.r* :’T • • :i 1 .-ct ,008»Sio^ s?oi ?a*)Wt.otU . i" ’ ■ ■ J'f’ '5L’*5 Oiy \CD^ . i-f o- •■:c* o .7. ^ ■. i.oim<40 rn” ■ bi"*‘'^v‘'’ ■■'• trrv' - '^*10700 ^io:- '^1 . rilnc* jx;o sd l fjv'? j£'rV- il| ' 3lJ ^VJiwi ... ‘-^p • ^ *.♦. . iUv; U'- ■‘>r'c.i' ■ '■ 'iQi * - V.:’i ii’' 'j f ' ■>; 1 *'. vj-n f.i Co. .. ' rrl <11: COC;;01';I . ii ^ ^ -•^^'T? , -•■••vu 7 ,* ^.: 7 U 5 / ■■ jflia got! ■ o t ;,\V' 5 , O' .'^uro o-O’ •.=; *X ,. :.i::om .-'■ >-•■:. ^.Tirftox'o: '. 'fiOio 11 . w ictronv .i.^T Ti . f . • ■ . ili Cf-vo 7 ’ o t » " '•■. ^‘'* •> '■'(.' a'' - OOOOot'.-= ..' 5 b- >: b »T's.i ■••.'':■• 1 ;.noi r . 0 ^ 3 fp£v / . r '; ■ • -'. rr I ' i. X C->id c-w'l fl- ^ ' '■- : i^;u' -rstiaal bcfed ’!oet' -'.iTO.: • J 'i .> OCu * • JCj]£t niOt flC -.• .V.,; sb 8*c! : : -.UH O' ~,0 r i ^ •. .'ir I .( ■' • ■*' ^/'Cj i!i . Lil.bC y. Dor/lio I p ' ' - V., *. :' - ' r > 1^5 ‘i ■•.' -nloh • : i % ovtj.vr- • .<• • 'V^ r^r -Lr'>::'" / ii,:. xi V.- . -f.a. r. ;»UG .■ ..».• >i ■ ■ .':■ ;.!'=*. f Tv ••-*.; -I • •■•?; nos':' i.' ''■■ ■'■■''• .s •^x.i' ' . '.I < y'LU^X'A r: ^ :xr - vObj ;ioip^ • ... . r • ... . . ■• -..7 ,». » ( \ 1 ,U G I'J - i-'O -• f ! ■ .- ioo io ••‘io»'r:o %". o..?.’:; • I^rO t •TOV'C'.fiii ?5ii? j ziToq"''* -bol G'bi?;. ^O.u-Or: .p , T. ^-^.-ofT) G .-. 1 ;^.; ‘I ' . -t" - • > . I ♦. *. ..- . '« ■ • - "t- .•••■ * •: t'jJc. > f ''X* *‘. - . -a :..si r •■'^: V "I ■ u « J J, ' .'^ li is . in r,-, r ,..;. -r. i''- O ■* ,;wf ., . - * 1 ' ■ •• • ' • c.., ; :v'G ■-' \> '.yu'^jl sq to E^-' v-i g/ • - •A II :••' ii :.' C o-O D'ic.' '*■■ '"'* * ' • -29- Iv/Ir. Sumanang discussed the "laissez faire" agreement with foreign oil _ companies, and said the Government did not in "principle" approve of it. (This agreement provides for the free use of foreign exchange from the proceeds of oil exports). The let alone pact with Standard Oil expired at the end of 1951. This brought 40% of Indonesia's oil under foreign exchange control of the Govern- ment. The agreement v/ith the BPM Oil Company of the Shell group would end January 1, 1956, and that with the Caltex Oil Company on January 1, 1954, he said. He did not indicate what the Government's policy would be when these agreements expired. Finance Minister Sumitro defended the Government's monetary policy. He attributed the drop in state income to decreasing exports caused by the slump in the prices of Indonesian exports on the v/orld market. He cited rubber, tea, copra, tobacco, pepper and sugar as exports that had "deteriorated, " The drop in the exchange rate between the rupiah and foreign currency could be traced, again, to lower world market prices for Indonesian exports plus higher prices of industrial goods abroad, he said. The Critical Situation for Natural Rubber Rubber is Indonesia's main export. The nation's economy is strongly affected by the volume of its rubber exports and tlie price of rubber on the international market. For months Indonesia has seen the price of natural rubber dwindle, a decrease caused mainly by heavy United States production of synthetic rubber. On May 4 Ambassador rdi Sastroamidjojo presented a note to the U, S. State Department, expressing his Government's concern over the critical situation for natnral rubber. The note emphasized in par- ticular: "The disposal of the synthetic rubber facilities by the United States to private interests will have a great effect upon the political and economic stability of Indonesia. ..." Indonesia asked fair competition between natural and S3mthetic rubber. At the conference of the International Rubber Study Group at Copenhagen, Indonesia championed the "buffer stock" plan. This was opposed by the United States, It provided for a pool stock. Rubber would be purchased by the Group when prices fell too low. When prices were too high it would be released on the market. The idea was to prevent too extreme fluctuations. The buffer stock plan was not accepted at Copenhagen, despite strenuous efforts on its behalf by Indonesia and otlier producer countries. This, plus the fact that rubber prices continued lov/, gave the Republic little alternative but to find other outlets for her rubber. The Government may, said the Djakarta news cable, "send trade delegations to countries hitlierto not having rubber trade with Indonesia, " If this happened, for example, with the countries of Eastern Europe it would not represent a political change, but an economic one,_ brought on by necessity. Djakarta so’orces say that Indonesia cannot continue selling its rubber at prevailing low prices. Quite apart from political considerations, it may become necessary to look for new trading opportunities. The Java Bank Becomes the Bank of Indonesia The E^akarta news cable reported July 2: "Stone masons this morning "^^sy chiseling out the name of the Java Bank which has become the Bank 01 Indonesia since yesterday. ..." Director Lukman Hakim was quoted as saying -30- that there would be no major changes in the work or organization of the institution. The Bank of Indonesia v/ould henceforth be the nation's official circulation bank. Finance Minister Sumitro said in Makassar June 30 that 98% of the stock of the bank was in Government hands. The original draft statute provided that the Bank of Indonesia will be under the management of a Board of Directors. Members of the board must be Indonesian citizens. They in turn will be under the 3 -man Monetary Council, which will have wide powers in laying down general policy. The Finance Minister is to be chairman of this Council, The other two members are the Economic Affairs Minister and the Governor of the Central Bank, The Monetary Council is to determine general monetary policies, including discount and open market policies, the total volume of credits, subdivision of special credit groups, and the supervision of the credit system. The Council will also take charge of State foreign exchange. The v/ork of trie Foreign Exchange Institute will be transferred to the Bank of Indonesia, The Bank's Board of Directors will have the job of carrying out the monetary policy as it is determined by the Monetary Council, In specific : matters, such as granting, refusing, extending, limiting and terminating credits, the Board has full power. The Bank will put out condensed balance sheets every v/eek. The Board will publish an annual report with the advice of the Monetary Council, The draft statute provides for an Advisory Council, consisting of repre- sentatives from private business as well as Government enterprises, to assist the Monetary Council. In reply to a question. Dr, Sumitro said it was not "a priori impossible" that non- Lid ones ian enterprises might have representatives in this advisory group. XII, FOREIGN REL ATIONS Indonesia's foreign policy, as it has been carried out by Foreign Affairs Minister Moekarto, v/as praised early in April by Djodi Gondokusumo, chairman of Parliament's foreign affairs section. The legislator declared that Mr. Moekarto *s conduct of policy "has resulted in Indonesia's becoming more known abroad as a nation having a steadfast, independent foreign policy, " He listed these major achievements of tlie Foreign Affairs Ministry in the past year: (a) Substituting the TCA agreement with the United States in place of the old MSA pact. (IVISA contained the suggestion of a military commitment in return for American aid. ) (b) Freezing the San Francisco Peace Treaty with Japan. (There had been parliamentary opposition to this treaty signed by former Foreign Affairs Minister Dr. Subardjo. As a consequence of the "freezing", the treaty has neither been ratified or rejected by Parliament. ) (c) Gaining an added measure of economic independence from Holland by arranging direct trade v/ith the nations of Western Europe, (d) Opening diplomatic relations with West Germany. > -31- (e) Furtherance of "close neighborly relations" with Asian countries. (f) Bringing Indonesia into the Colombo Plan, The foreign affairs chairman considered these tasks "still undone": (a) Change the status of the Indonesian-Netherlands Union, (^) Open an Embassy in Moscow, (c) Return the disputed territory of West Irian (New Guinea) to Indonesia. Open diplomatic relations v/ith Japan, Indonesia and the United States Indonesia concluded a new aid agreement with the United States January IZ The pact provided for continued American economic and technical aid to Indonesia, but discontinued military aid on a grant basis. Henceforth, Indonesia would pay for, rather than receive as a grant, any military equipment it rpight obtain from the United States, Djakarta dispatches said the aid might total $5, 000, 000 this fiscal year for education, food production, public health, and industrial engineering and development projects. Three influential Indonesian newspapers expressed satisfaction with the new pact, although they noted that the arxount of aid in itself was not significant. Abadi thought that the willingness of the United States to replace the controver- sial MSA pact with the TCA agreement (which contains no suggestion of a political or military commitment was an "indication" that America understood the Republic's independent foreign policy, Pernandanqan welcomed the new agreement, and said the MSA problem was now settled. Pedoman remarked that the aid involved such a small amount that "it would have been better if America had increased the prices of more Indonesian niaterials like rubber and tin by a few cents per kilo. Even so, this Socialist party paper looked with favor on the new pact. Following the January 12 announcement of the agreement. Foreign Affairs Minister Moekarto said that American aid had been of great importance in Indonesia's reconstruction. He hoped that future aid, under the new arrangemerl would also prove to be useful. On January 20 President Soekarnc cabled "sincerest congratulations and best wishes of the Indonesian peoole" to President Eisenhower, H, Merle Cochran, first United States Ambassador to the Republic of Indonesia, left Djakarta by plane February 27 to return to his own country. He had resigned February 10 to accept the nev/ post of Deputy Managing Director of the International Monetary Fund, The Djal^rta daily Merdeka declared that Mr, Cochran had made a Indonesia's struggle for independence. As a member of UNCI (the United Nations Commission for Indonesia), he had continued the ^od work begun by Dr. Frank Graham, the paper said. Merdeka noted that tne Republic s international position became mmeh stronger after Mr, Cochran gave his report on the second Dutch military action in December, 1948, ' !i s'.: ,.nx:i9 ad V. ''' vJ; Jn? .- r ;^rc ».oI a' -T .Qi Kric*' J awr'J 'D o.*'JcMr npro'iot ';;'l , i nai^c^iOD.'I V' ni:i:..: ::Li !o a: ;t.../;df:j J nfi no ]P .^) vjri (/ii'niaD - . ') -Jiii'il ir^cvV ro ,"j.ojrj':o.} I •'•iirqi;!'- e iJ "iiv: p,noV-^i *i aij/’;iic{ :ib * ■ • * . p >fi'- bn:. £faf>)"obrd b7-»iirTJ rrj diiw insf^rao^n,;: r?*: w^n i? i.fc Ls;-::ni,..' .'t t>r.'i ci:m..,;.oo"* i:r:.';':''-rfj::i baunitnoL t/t btHji‘7c*.*q s>riT '.'.a .-rcijiil - i Jnx. 7 r /• no • bi 77aj:Iinr bOi'inJn''.‘nnii; j;;d ^.sir-v. / T j: a - :1 ^ ,:Qt.;rr i; o/i /n:"'; '^hc r-xi/o^v jfirim nb *^rlj biiin -iairpif; t.efit'U n.:j ni£ic‘y b/u b -iL b': ■, •i': b^.7‘1 ,n' •sv" ^jg^v iionii c-.b: OOC . joob'<’ : •■iii'f;-'!Ov :b bns? IxinJOi/bn- ^n; ;i:iv7 f!o:» U: . ' -737-xq\; .v . ,iSo"! oi'i i:'. .:i;v^ .:.' Als V' jnrrs ■}■: o/ii ;Arij baH- weii ^•v ^vo-’Mon " 0 ■:Ar :-i vj b ..J:nl- 7 V> Uni: ,.'-pno*:* -bnoA ■f ro ;:v):i*.«;ypijx-. ;:•.: ’or;7.i;n':)0 'h invv} jxir).'- • AOT anc :.iiv jncq lioo^r t' bin: .''io^b..'. .'ad; ‘v :St£nibfu” n^. b';.v .^iiO: s ’^hrroK o . :c iQclliloq 7o.■^j^ - i '7’"^'* '• ••? " b li ’ Sxrl j jni'O.'T;*^ ffarnu f: iouc ' -'.?0'/n; bis £dd }h‘i1 , :x:& 7/7' 'm"! •r . iJ n.ci-;. ,?•){ D:';q srIJ 1 -o in :* yr.i •bad sa^lS.'ffA : :^i Oi 'I'r'- 7jv . *ji ; 'A' ?i! edi' lu 'fovnl / e^il. /.A :.r- ■;. ,j;i: :7'f ■■ } ’ 0 Jnr . f’-f Cf '■ 7;"r:;.(„ ‘.bZ yoLai/nab « .y , ■;iv;c'io'b . • i ’ J ' ■. ’. J n. i'jU. . i:.>i .b.re ■-, 'k r- ■•■./'.. ip 'it J' Vr'- ‘ /' •■7 rxaiv.)!’': '‘.•.?ni Us,'! M'-: ' f . { . * . • • # ^ i ril' sr<-; “ 4* .wn; ;ii^i|vu': s.i’ ,.n ; iOi.’-j Ll. obi .:“0 7 : ;\li n'XK; *« : 4 ..f A C* ' •; .-. ' r » r.UUC'.:/ <. i -o-riq ;•' ■ii l:Ij/dw i i ^ vL - k * J ' l '7v. Ij '-i i'-: .-N.- ;Oi/7l b 1.. LO;'?.: bii*-^ .•no!i.n^n£7^,o- • J<. ononnls-' '7. lire alb tV ^ • • * ' t ■ ).T '.^t: .Gc,::. J' - :fA ,. '.'Vln- ^T'T.:'; 1 «• ■'j .J • « 't\ . <»4 ■! #■( j x:; orniiO ycl A* .T *•'• r '.[con'''br.I :lv •- m?:,. : .;C'- * '■'. * M' . L' V ' Oi i url.» :.\^: . ,. . .uX y'i7 7.'c ? ■ i* r >*r« -j'i .i: 'X^:.o;,.'!Vl tooii.iiX-v j.lJ > ij 10 v:''0*r^L a obn;: : •-7-’ ; ti ' -»'/•«/ , _m ■■ k * • 3x- •' L'on*. ■J e.fx7. fc'tZa ■-* ■ 0 .1 f • -f * :A ** ■ •'‘i v'*' '*' r' ^,; -i 4 ’^ ! “ - . 'jc. ';r: T?:r"a . r . ro:i:.'U ' ■ ul-oix;' .d) if.- ■ _ r i:. ?!.■■.-■■ ( * ' f'f * '1'** ' . '■!.. , .'nd.v-.'y S-.'.i- .'d ."si • V v;'.v 1 oop •j ' 4 b •'< ,: -r’^rr-r; 'tT' ,'.. w .' ') '\i noUi-f^o:; b..; * .4 • . . • ' .■■•'•* [ •»^r. :!4 .ri on . .t vi t* •«{«'. int s.a; jXj ■i/i*’'-' :; o i'iOqOI -32- "Cochran will leave many friends in Indonesia, " the editorial went on. '•He can be satisfied with this part of his career because he succeeded in doing good work for this country. Despite a political atmosphere which was by no means ideal for American-Indonesian relations, and which was often over- shadowed by suspicion of Am^erican motives, Cochran was successful in preserving and defending good relations between Indonesia and the U. S.A. " Indonesia and Holland Traveling through eastern Indonesia on an inspection trip, President Soekarno learned February 4 at Makassar, Celebes of the storm and flood catastrophe that had struck the Netlierlands, Great Britain and Belgium, He promptly issued this statement: "I am deeply moved by the disaster in West Europe, I can well imagine the misery of the afflicted and extend my sympathy in their distress, I hope that with united endeav- ors their misery can be assuaged. In their feelings of sorrow and grief, the Indonesian people know no political differences. We are all children of God. " Prime Minister V/ilopo cabled the Prime Ministers of Holland and Great Britain February 5 conveying the Indonesian Government's 'l^epfelt sympathy" for the victims of the floods. The Djakarta daily Pedoman and weekly Siasat made sizable contributions to the Netherlands committee in charge of raising relief funds for the disaster areas. As early as February 5 two planes left Djakarta for Amsterdam carrying four and a half tons of relief supplies including tea, rice, blankets and clothing. The Indonesian Government decided that the services of the Netherlands Military Mission in Indonesia will not be needed after this year. Indonesian and Dutch representatives began talks March 26 in Djakarta to end the agreement covering the Mission's activities. (The agreement was signed in November, 1950, It expires December 31, 1953. ) Indonesian delegation chief Ruslan Abdulgani, Secretary-General of the Information Ministry, expressed the Republic's appreciation for the Mission's help in raising the technical standards of the Indonesian Armed Forces, He said that ending the Mission's work in Indonesia did not diminish Indonesia's readiness for "voluntary cooperation" v/ith the Netherlands, The form of such cooperation would take into account "realities now developing v/ithin the hidonesian community, " he declared, A very young nation, he said, had a strong desire to stand on its own feet, or at least reduce to a minimum the amount of aid it received from other countries, Baron Van Ittersumi, head of the Netherlands delegation, replied that the Indonesian Government's decision coincided v/ith the desire of his own govern- nient to withdraw the military specialists from Indonesia and use them elsewhere. i J-' » . ‘ ij'.. : ..^;v a: 7 •'.-jl'nj /.i 7”i ’t"k • ’ '£''\ . 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Actually, all parties favored establishing the Embassy, but the Masjumi, Catholic, and Democratic parties did not believe it should be done just yet. It had been pointed out during debate on t!ie motion vhar. even the countries aligned against the Soviet Union in the cold war had representation in Moscow. For Indonesia not to be represented there was inconsistent with the Republic's independent foreign policy, the majority of the legislators believed, Indonesia and Japan were still unable to agree on the amount of reparations the Japanese should pay the Republic for damage done to Indonesia during V\/orld War II. In 1951 the two countries reached an interim a.^eement on the form these reparations should take, Japan was to pay pnmc-rily in goods and services. How much she would pay remained a question, Cc'rnmunications Minister Dr, Djuanda, who headed the Indonesian delegation to Tokyo, said February 24 that no one knew when reparations talks would be resumed, Indonesia is still legally in a state of war with Germany, The Foreign Affaiis Ministry said March 3. hi an official statement, the Ministry explained: "When Holland was occupied by the German Army on May 10, 1940 the former Netherlands Indies, as part of the Netherlands Kingdom, entered into a state of war with Germany, The Republic of Indonesia as the legal successor of the former Netherlands Indies is autom.atically, therefore, in a state of war with Germany, " The clarification follov/ed a statement from Bonn February 27 that Germany and Indonesia v/ere never at war. The two conflicting views arose out of an economic question. The West German trade mission in Djakarta reportedly asked that Germany's prewar holdings in Indonesia be returned to her. (Value of this property was estimated at 64 million rupiahs). Indonesia's view v/as said to be that Germany's invasion and occupation of the Netherlands caused considerable indirect damage to tlie "Indies", The amount of damage might well be considered (at a future peace conference) roughly equal to the value of German property taken over in Indonesia, Djakarta sources suggested, p^-rmasetiawan, Secretary- General of the Foreign Affairs Ministry, died in Djakarta March 7 one week after undergoing an appendicitis operation in the capital's C^neral Hospital. Dr. Sudjono, Indonesia's first Ambassador to Brazil, left Djakarta April 1 for Rio de Janeiro, He was formerly head of the Republic's diplomatic mission in Tokyo, . , .It was announced in April that Arnold Mononutu, Information Minister in the Sukiman and Wilopo Cabinets, v;ul go to Peiping as Indonesian Ambassador to China, Xni. INDONESIA’S LEADERS SPEA^ , . In the first part of 19o3 three of the Republic's top political leaders gave clear statements of the Indonesian viewpoint on various world and domestic issues. President Soekarno declared in an Islamic Ascension Day address April ib that Indonesia's foreign policy should not lead to isolationism and "exclusivism". This was not the Islamic way of thought, he said. Speaking to thousands outside Merdeka Palace, he urged Indonesians, according to the Djakarta news cable, to note the good, side of both contending camps in the present world conflict. He suggested that Indonesia adopt the good influences (of foreign cultures), if they were in harmony with the life and religion of the Indonesian people. "Only in our beliefs is there no compromise, " the President said, Vice-President Hatta published an article, "Indonesia’s Foreign Policy", in the April lyb3 number of the American quarterly review Foreign Affairs. He explained: "The Republic of Indonesia feels that it is its duty to strengthen the ideals of peace, ... It believes that these ideals will become reality in tlie long run. It believes in the common sense of mankind o Man, rational by nature, will eventually make a positive and definite choice of good over evil, peace over war. The discovery of weapons of war which become progressively more terrifying and destructive will strengthen man’s love of peace. , , , "The Government must concentrate on the task of building up the nation and it must shov/ evidence of economic and social betterment if it is to offset the influence of agitation by radical circles. A foreign pc] my that aligned the country witli either bloc of the Great Powers v/ould render this internal task in- finitely more difficult, " In the United States Amba ssador Ali Sastroamidjoio said April 8 in an address to tlie Rotary Club of New Orleans: "As of January, 1953, American investments in Indonesio. totalled fifty-eight million dob,ars„ Among the coi'-panies doing business in my countr '' are Stanoirri^Cilj Goodyear, International General Electric, Genexa' Motors Overseas Corporation, and Eastman Kca-ih... "'Icdp.y, Indonesia is a land of opportunity ■^or foreign business. However, this opporu'nirr is not of the laissez- faire variety, nor does it resemLle tie coioniai-.siyle opportunity to exploit a country v/ithoat regard for the welfare of its people. There is good business to be done in Indonesia -- for tiiose who look forward to making a fair pront, under the conditions set forth by the Government. " . .UY . or ii c: Mk^i:q9Si e.U ^v'l/fi rafil 5^:5q a. : ul- DlJf^3"nob '..'£> ciiuw ;io ^ooovcjh rt^.^su^oi/nr »:sl*j%aC‘lsia%6£iir ^v£c ,LO'..?:et SGD*l^bJ:• \(Y.. .nolt'f:3ox\ nlnfi^ld is ni t ^ \ ^ mrinOlTjeloa? cl b£ -l ion bii»orf8 .?7.To7T:lo bill' JI tmT! a i:*iiA 't;or;re ,b.'-o o .Jrivcorinc; 9d; ♦0>i .’.’rrTSlvi^lQXo*’ o) jcUj.'bi'^nobnl' ' opic* o/i ^tie^L'o ^ o o# n: "-xic-.vc: r'-fibi- ^jnoo rbod to obxs booi? :»30i. :>i c.wsr: £’'U orU ho':':;:: sni ^*a;.Ka’)t>aI jjsrij bels©pi?a;;;.9H blic* ■ to-^sie^iq tr;, jlTf -iij jtrlw -^IcrTTiitrl oi-'W \{ vfj li 1. ) *’ . hTto\u'';\>b on alBilr^d Vjc ai 'itiry' .Dlqo-i^q cM o.i' to ’ ‘ • , :i£t #i!sW8'?i^ erij otofc^n'^bf>T“ r.£ t&nctldi'q n5 ?6i- l -oX’n’T'jT'T" .i r'C-llA •■iCiaX- •rj-ib r.tl ^:.l ii j Bcii BlaonottBl to rfidaqo'7 ■ toril anv: :to^ ff , . * » -•: Lfsq to ^i.H3bi Oib as ipr^ r?s Qi .-Ui*x -;i30v-^fj u! 300090 r|iV.-_ 3 ;*/-^ ibaorji!^'' ,n5i?o '.bxJ”5{frii-'ti to o'. -' -j .Ta’idy i.'i cvii^-8oq B :•* ••- ';a' 4*tQV0* 'n'T 1'j 4\ ‘ \b''C ji^V'" '*5VO boG\'; XC' 6r.»ifu*o av^!/\/ovrct-.9’i ' o:c; gmoosa, xioulv; *x£v' to .'r.o.i^^tnv re . ^''^:>^ s'^yinr aotiSyUf^tiiC iliw 3vit:'?fxJ8ot tniB ^.niv'J’i'i^i. ob«oq- ?o i0 5lr>x5j iic kji^:na'i3\'C^j erT;’* ' ;*< • "’i/O ' vfoiin ffClJ£r. qi '^>r,'Lia’C c to ■» ? 12 li ii^ ri j to:b08 dr.to r -'O *T .: -1 A .aai-yito totobf/ to 'y y(k djtv/ oxii ct'r'trjiifi. 'v.Joq -it* :/;^; :^a\3)Jlt zl*ti t’ JfOW PAvV.JT'’" .l£^‘ ' '* .Ji O'io.O ^i^:^*.;U C!* ^ Ikicr . .«df ' * ^ ■ .'i *: rl V £.;I; oi aooTbbxi pwmA .ri- 'A-ti 4oW''i-' 5t''tii'3-V'i.; cj-3iieJ(.J . / ;■ ■ ’■-vI ' vr.r r.i pnf-b ^IcfK >< ' ''d 11 >i ' (»^i Ik- -■■' .1 r-i^r ;;ioBCj. ^^-:■ .iT. .OoO V*' .••j^-;ioc:-tol; ;Vt'.‘8i*3vO e-^cjcN' to>J xo' 'ttir :c.( V.’ !'/<' ‘0 ^r.;ix sdL'jnotiS ^ '- i'*’ ’ '?>iV ’''v:4;y.to •■.‘;1J ,xo,-&w. T' ,'■ .nt' :4«f •• ■ . i , -^r‘V» li ton . ■ . 0 ; bo. \ o . ix to*Aw x'i.ii;:.oo 0 JZ-I*:. ^ : ‘ -(^rxutwqqo w.-i •'. n M-S3i;;^x- b-‘o?; a? .otoooq *12 to :r.s4s^^*..,'t C3 .'\ty>ir'i to. 01 M, M ''-to -•' .v.a50<;ofil. nr ‘..to! v J tor. no- anr,..*raioo BdJ tafeito' .iito'iq -35- XTJ, INDONESIANS AND AMERICANS The Republic's Eighth Year of Independence saw Indonesians and Americans visiting one another more often. Scores of Indonesian students were in the United States, while American scholars, political leaders, businessmen and technicians could be seen in Indonesian cities and towns. Chief Justice Robert G. Simmons of the Supreme Court of the State of Nebraska commented in August that the development of law in Indonesia seemed to have much in common with the grov/th of the United States legal system. Sovros P. Skouras. President of 20th Century Fox Films, made a brief visit to Indonesia early in November, He was received by President Soekarno and talked with leaders of the film industry, Henry Luce, publisher of Time and Life, was a visitor during December. LIr. H.A.M, K.A, Amrullah, known by his pen-name HAMKA as one of Indonesia's and Southeast Asia's finest novelists, came to the United States in Cctober as a guest of the State Departm.ent. The author, a prominent Moslem, said the purpose of his trip was to help bring about a better spiritual understanding between Indonesia and the United States. His favorite American writer: Pearl Buck. The most influential Auierican novelists in Indonesia: Ernest Hemingway and John Steinbeck, Fifteen Indonesian labor union officials also arrived in the United States for a six-month course of study. Mrs. Supeni Pudiobuntoro. a member of Indonesia's Central Election Committee, studied the American presidential election. She was strongly impressed by the prominent role of women in the campaign, Cne of Indonesia's top-ranking leaders, Hadji Agus Salim , arrived in the United States January 23 to give a series of lectures at Cornell University on "The Teachings and Philosophy of Islam" and "Islam as a Social Factor, " The 68-year-old statesman, educator, and philosopher is known as the Republic's elder statesman. His role in Indonesia has been compared to that of Mr, Bernard Baruch in the United States, Indonesian-American cooperation in trade relations was emphasized January 9 by Ambassador Ali Sastroarnidjojo when he presented a citation to klr, Marsha ll W. Tuthill on the Twenty-Fifth Anniversary of Tuthill and Comf^y as agents for the Indonesian Government Banka 'Tin Sales Office, Retiring United States Ambassador to India, Chest er Bowles, visited Indonesia for seven days late in March. He said he hoped to "gee a look at some facets of the Republic's economic system and see the working of its political system at the village level. Adlai Stevenson was in Indonesia from April 9 to 13. He found that the Republic had made significant advances since it achieved independence, especially in education, housing, shipping, and organization of the Armed Forces, He predicted more harmonious relations between Indonesia and the United States, saying there were "many similarities" bebveen the two nations. At his final press conference an Indonesian reporter said, "Mr, Stevenson, may I offer my that you were not elected President of the United States. " I’eplied, "I'm sorry you're not a registered voter in the United States. " j j s 4 •M * \ 5 -36- XV. WILOPO CABINET RESIGNS The Cabinet of Prime Minister Wilopo resigried June 3 after its two major components, the Masjumi and Nationalist parties, failed in a last- minute effort to reconcile their differences over the Sidik Kertapati Motion calling for changes in the Government's resettlement and land program in North Sumatra, The motion was supported by the P.N.I. and strongly op- posed by Masjumi. The North Sumatra program was being carried out by Governor Abdul Hakim under the direction of Home Affairs Minister Dr. Mohamad Roem, both Masjumi leaders. — The North Sumatra lands in question were leased by the former Netherlands Indies Government to the Deli Planters. During VJorld War II they were occupied by people from tlie area who remained through the struggle for independence and the post- war years. Under the current resettlement pro- gram the Government sought to move the squatters (giving them money and new farms) to neighboring areas and return the lands to their former opera- tors for development. Resistance to this plan, and criticism of it in Parliament, led to the cabinet crisis. — Masjumi demanded that the P.N.I. show solidarity with the Cabinet and support Home Affairs Minister Roem, The P.N.I. responded that its attitude was "in line with the spirit of tne motion" of Sidik Kertapati, It proposed as a compromise that Dr. Roem be shifted from the Home Affairs portfolio. This was not accepted. The Cabinet then decided to resign before the North Sumatra question came before Parliamient. The Wilopo Cabinet came into office April 19, 1952. Its most important achievement was drawing up the General Elections legislation accepted by Parliament with minor amendments earlier this year. It was also responsible for the "inducement" system regulating kidonesia's imports. There followed a prolonged cabinet crisis. Five attempts were necessary before a new Cabinet could be formed. The formateurs were (Ij Dr, Mohamad Roem of the Masjumi Party and Nationalist Party (P.N.I.) leader Sarmidi Mangungsarkoro (2) Moekarto Notowidigdo of the P.N.I, (3) Moekarto again, with a revised mandate, (4) Burhanuddin Harahap of Masjumi TS) Wongsonegoro of the Partai Indonesia Raya (P.I.R,). The appointment and final success of klr. "Wongsonegoro was precedent - breaking. It was the first time a small-party leader had been named to put together a Government, The move became necessary when the nation's two major parties proved unable to compro'mise their differences over key portfolios. They had also been divided on four major questions; (a) The land distribution problemi (b) Disposition of the North Sumatra Oil Fields (c) Opening OT an Indonesian Embassy in Moscow (d) Ratification or rejection of the San Francisco ±^eace Treaty with Japan. / r'J> o^p Jlv/ /’x civ^ tiJi 'tfiilB C ti:)xX b^H;^Ur»'r oq vIlW i \o ^dfild^O €dT a v.i b-jiiiiV ti-sU'iiXT J.'U' Wi tm lhIJJj;^.^’M fti? ^r.tnw'fToqrv ;r.. fPOiicM ?iibi2 oril isvo ■.] ii-riiti n nic-iToiq toii’bfw: y a*3n^;»irfm.9Vo£y erd ni, ■ T02 i>?:l[u ■ V i »:-f!j "e? b->i7oqqua ajiw imifom 5 T ” ,x:Tj;b.triJc :jL^ioPT •ri Jj.o b;:i'*-UBO ';n^xj 2iSV7 aT^'i^ouq ,.'i^^.crjLr3 rlj-xoTl n./x ,fTii; j i i>3-ioq . Xi i-ixailA ^cncH to -noik c^'siu ciiJ 'i. jbnxf lat-JA i6xi t'J7oO hiwiia^i iUoii ,frreoH bk^sdcM * X, Yd b:^i5f;oI £>'*?rw noi?'3tiUC rri strici ;''a«^:>;^;*,. — . • orli ^'.1 irtiVTfr^-iovoO ;:ijn':ii'ii>iij9H ''is/’:r'’r>l arU oz9v: il *i^'V tlrJ-^7 tiL'^oCl . 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