Identifier
Created
Classification
Origin
08JAKARTA943
2008-05-13 06:31:00
CONFIDENTIAL
Embassy Jakarta
Cable title:
INDONESIANS PROTEST PLANNED FUEL PRICE HIKES
how-toVZCZCXRO2641 OO RUEHCHI RUEHCN RUEHDT RUEHHM DE RUEHJA #0943 1340631 ZNY CCCCC ZZH O 130631Z MAY 08 FM AMEMBASSY JAKARTA TO RUEHC/SECSTATE WASHDC IMMEDIATE 8984 INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS PRIORITY RUEHBY/AMEMBASSY CANBERRA 2478 RUEHLM/AMEMBASSY COLOMBO 1007 RUEHKA/AMEMBASSY DHAKA 0953 RUEHNE/AMEMBASSY NEW DELHI 1827 RUEHKO/AMEMBASSY TOKYO 1949 RUEHWL/AMEMBASSY WELLINGTON 2634 RUEHHK/AMCONSUL HONG KONG 2667 RUEHBAD/AMCONSUL PERTH 0785 RUEAIIA/CIA WASHDC RHEFDIA/DIA WASHINGTON DC RUEATRS/DEPT OF TREASURY WASHDC RUEAWJA/DEPT OF JUSTICE WASHDC RUEKJCS/SECDEF WASHDC RHHJJPI/USPACOM HONOLULU HI RHEHNSC/NSC WASHDC
C O N F I D E N T I A L JAKARTA 000943
SIPDIS
DEPT FOR EAP, EAP/MTS, EAP/MLS, DS/IP
NSC FOR E. PHU
E.O. 12958: DECL: 05/13/2018
TAGS: PGOV PINS ASEC ID
SUBJECT: INDONESIANS PROTEST PLANNED FUEL PRICE HIKES
REF: JAKARTA 928
Classified By: Pol/C Joseph Legend Novak, reasons 1.4 (b+d).
C O N F I D E N T I A L JAKARTA 000943
SIPDIS
DEPT FOR EAP, EAP/MTS, EAP/MLS, DS/IP
NSC FOR E. PHU
E.O. 12958: DECL: 05/13/2018
TAGS: PGOV PINS ASEC ID
SUBJECT: INDONESIANS PROTEST PLANNED FUEL PRICE HIKES
REF: JAKARTA 928
Classified By: Pol/C Joseph Legend Novak, reasons 1.4 (b+d).
1. (C) SUMMARY: Thousands of Indonesians demonstrated in
Jakarta on May 12 protesting GOI plans to increase fuel
prices. The largest rally took place in front of the
Presidential Palace. The rallies were peaceful. The
Indonesian legislature is also heatedly debating the matter,
with the balance of opinion opposing the government. Under
fire, the GOI is conducting a public relations campaign
focused on ways to sell its plans. Given all of the
opposition, it is not clear whether the government will move
forward. END SUMMARY.
2. (U) TAKING IT TO THE STREETS: Thousands of Indonesians
demonstrated in Jakarta on May 12 over GOI plans to increase
fuel prices. The largest rally took place in front of the
Presidential Palace. The march was peaceful but vocal, with
rally goers energetically condemning the government. Marches
also reportedly took place in Medan, Surabaya, Riau and East
Kalimantan. (Note: Reftel reviews recent protests on the
same issue in Makassar, South Sulawesi.)
3. (C) LEGISLATURE DEBATES MATTER: Back from recess, the
Indonesian legislature (DPR) is debating the proposal.
(Note: The legislature, technically, has no role in
approving the proposals since the administration is free to
take steps to lift the subsidies.) Based on what we
understand, the balance of opinion in the DPR strongly
opposes the government's plans. Golkar--which is the largest
party and a member of the President's governing coalition--is
split on the matter, for example. Meanwhile, the key party
in the opposition, the Indonesian Party of Democratic
Struggle (PDIP),is stridently attacking the government's
plans.
4. (SBU) GOI EFFORTS: The GOI is attempting to counter the
bad publicity with a public relations campaign that
highlights a cash transfer program and other "pro-poor"
policies that the GOI plans to unveil along with the fuel
price hike. Economists and GOI officials have told us that
the fuel subsidy program mostly benefits the rich. The World
Bank estimates that the richest 10% of the population use 40%
of the fuel subsidy. The GOI would use about half of the
fuel subsidy savings for a cash transfer program that would
give Rp 100,000 ($11) per month to 19.1 million poor
families. In addition, the GOI would increase the subsidized
rice program, which totals about $450 million. The Minister
for Social Welfare, Aburizal Bakrie, went as far as to say
that the poverty rate could be decreased from 16% to 14-15%
with these "pro-poor" policies.
5. (C) WILL THEY GO THROUGH WITH IT?: GOI plans to hike the
price of fuel make economic sense. That said, given all of
the opposition, it is not clear whether the government will
move forward with its plans. We have heard from some
contacts that the GOI--which is notoriously risk averse--is
very sensitive about the politics of the situation and may
well back down. If it does move forward, the government will
certainly face more political protests.
HUME
SIPDIS
DEPT FOR EAP, EAP/MTS, EAP/MLS, DS/IP
NSC FOR E. PHU
E.O. 12958: DECL: 05/13/2018
TAGS: PGOV PINS ASEC ID
SUBJECT: INDONESIANS PROTEST PLANNED FUEL PRICE HIKES
REF: JAKARTA 928
Classified By: Pol/C Joseph Legend Novak, reasons 1.4 (b+d).
1. (C) SUMMARY: Thousands of Indonesians demonstrated in
Jakarta on May 12 protesting GOI plans to increase fuel
prices. The largest rally took place in front of the
Presidential Palace. The rallies were peaceful. The
Indonesian legislature is also heatedly debating the matter,
with the balance of opinion opposing the government. Under
fire, the GOI is conducting a public relations campaign
focused on ways to sell its plans. Given all of the
opposition, it is not clear whether the government will move
forward. END SUMMARY.
2. (U) TAKING IT TO THE STREETS: Thousands of Indonesians
demonstrated in Jakarta on May 12 over GOI plans to increase
fuel prices. The largest rally took place in front of the
Presidential Palace. The march was peaceful but vocal, with
rally goers energetically condemning the government. Marches
also reportedly took place in Medan, Surabaya, Riau and East
Kalimantan. (Note: Reftel reviews recent protests on the
same issue in Makassar, South Sulawesi.)
3. (C) LEGISLATURE DEBATES MATTER: Back from recess, the
Indonesian legislature (DPR) is debating the proposal.
(Note: The legislature, technically, has no role in
approving the proposals since the administration is free to
take steps to lift the subsidies.) Based on what we
understand, the balance of opinion in the DPR strongly
opposes the government's plans. Golkar--which is the largest
party and a member of the President's governing coalition--is
split on the matter, for example. Meanwhile, the key party
in the opposition, the Indonesian Party of Democratic
Struggle (PDIP),is stridently attacking the government's
plans.
4. (SBU) GOI EFFORTS: The GOI is attempting to counter the
bad publicity with a public relations campaign that
highlights a cash transfer program and other "pro-poor"
policies that the GOI plans to unveil along with the fuel
price hike. Economists and GOI officials have told us that
the fuel subsidy program mostly benefits the rich. The World
Bank estimates that the richest 10% of the population use 40%
of the fuel subsidy. The GOI would use about half of the
fuel subsidy savings for a cash transfer program that would
give Rp 100,000 ($11) per month to 19.1 million poor
families. In addition, the GOI would increase the subsidized
rice program, which totals about $450 million. The Minister
for Social Welfare, Aburizal Bakrie, went as far as to say
that the poverty rate could be decreased from 16% to 14-15%
with these "pro-poor" policies.
5. (C) WILL THEY GO THROUGH WITH IT?: GOI plans to hike the
price of fuel make economic sense. That said, given all of
the opposition, it is not clear whether the government will
move forward with its plans. We have heard from some
contacts that the GOI--which is notoriously risk averse--is
very sensitive about the politics of the situation and may
well back down. If it does move forward, the government will
certainly face more political protests.
HUME