(Petaling Jaya, Wednesday): One lesson to be drawn from the deepening Indonesian crisis is that there can be no effective economic reforms without political reforms.
One important reason why the US$43 billion economic package of the International Monetary Fund - a key cause of the anti-Suharto protests because of the sharp price rises in basic commodities it required - has failed to rescue Indonesia, and has been described as undermining currencies and spreading confusion for fighting financial fires by "dousing them with gasoline", is because of the inability of Jean-Michel Camdessus, the IMF managing director, to realise that imposing strict austerity on Indonesia without political reform would lead to social upheaval.
Although Suharto has been described as the father of Indonesia’s "economic miracle" for the three decades of growth that brought the nation out of abject poverty, the last straw that broke the camel’s back leading to widespread unrest is the national outrage felt by Indonesians that the Suharto regime could pump US$12 billion into insolvent banks owned by the well-connected rich while it cut US$2 billion in fuel subsidies, hitting the poor hardest when they are already down.
By Indonesian government account, Suharto's children were the eighth, ninth and 14th largest taxpayers in Indonesia last year. Forbes, the US magazine, last year placed Mr Suharto third in its "king or tyrant" category and the sixth richest man in the world, estimated him to be worth some US$16 billion and the whole family US$46 billion - some US$3 billion more than the IMF package. But much of the family fortune was built on levies and consulting fees rather than shares, and little of that is reported.
All governments in Asia including Malaysia should learn from the mistakes of Indonesia and enlist popular support to make a renewed and determined attempt to wipe out the 3Cs - cronyism, corruption and collusion - which must be recognised as one of the major causes aggravating and prolonging the Asian financial crisis.