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close this bookPromoting Sustainable Human Development in Cities of the South: A Southeast Asian Perspective (UNRISD, 2000, 56 p.)
close this folderIV. Focus on Southeast Asia
View the document(introduction...)
View the documentThe Philippines
View the documentThailand
View the documentIndonesia


Although comprising a substantial landmass of some 2 million square kilometres distributed over approximately 14,000 islands, almost two thirds of Indonesia's population is concentrated on the relatively small island of Java, together with neighbouring Bali and Madura.6 Urbanization has been progressing in recent years at a rate of about 2.2 million new urban inhabitants a year, mostly in Java. By the late 1990s well over a third of the population was urban and the expectation is that over half will be urban by 2005. Javanese culture is one of small peasantry and about two thirds of the new urban population is of peasant origin.

6 Unless otherwise noted, information in this section is derived from Atkinson (1998a), as well as from the author's own subsequent experience.

Although new urbanization is distributed between growth of existing urban areas and the emergence of new towns and cities in rural areas, Indonesia distinguishes itself in regional terms by the growth of very large cities. Already in 1990 there were 10 metropolitan areas (seven of these in Java) with over a million people, and there are two more or less continuously urbanized corridors within Java that already contain almost two thirds of the urban population of the island.

In recent years the Indonesian government has had strong and coherent urban development policies and programmes, but urban authorities have still failed to keep abreast of changing conditions on the ground, where significant areas have developed informally. In the 1960s and 1970s these developments were in both inner and outer urban areas, but more recently they have been predominantly on the urban peripheries where migrants are settling close to existing villages to form what amount in extreme cases to emergent cities of informal development.

In general the state of Indonesian cities is similar to that of cities in the Philippines, reflecting the high levels of poverty and informal developments. In spite of highly structured programmes aimed at improving urban living conditions, there remain everywhere shortfalls in major areas of service provision and the state of the environment (Kusbiantoro, 1997). Nevertheless, over the past 25 years, a very extensive programme (the Kampung Improvement Programme - KIP), financed mainly by the World Bank and the Asian Development Bank, has been organized to legalize informal settlements. This programme has provided basic infrastructure, which has had notable results in upgrading large numbers of poor settlements throughout urban Indonesia.

Over the years the proportion of the urban population living in poverty steadily declined to such an extent that by 1996 official estimates put it at just 10 per cent. This situation was reversed dramatically by the currency collapse of July 1997. The value of the currency continued to deteriorate for many months after the initial shock and the rupiah hit bottom at 15 per cent of its pre - crisis exchange value against the US dollar.7 The impact was immediate and dramatic, resulting in the collapse of industry. For instance, in Surabaya, on one major industrial estate alone, over 10,000 workers were made redundant within a matter of weeks. By mid - 1998, 20 per cent of formal sector jobs in Indonesia had disappeared and GDP had declined by 15 per cent (Lee, 1999). The prices of staple foods climbed so high that the spectre of mass starvation arose and the government initiated an emergency programme to distribute the "nine basics".

7 By the middle of 1999 it had returned to 35 per cent of its pre-crisis level but remained unstable.

By mid - 1998 government estimates put the proportion of the population subsisting below the poverty line at just under 40 per cent - and rising. The International Labour Organization (1998) estimated that this would rise to over 60 per cent by the middle of 1999 and in mid - 1999 the World Bank confirmed that, in spite of superficial indications of economic recovery, poverty was indeed continuing to rise. By mid - 1998 all major international and bilateral development agencies had instituted some form of emergency assistance programme for the country (BAPPENAS/UNDP, 1998) and each government agency was making its own contribution to construct a "social safety net" and other aspects of emergency relief.

Regarding the orientation towards sustainable development, it would seem prima facie that under current conditions it might be difficult to focus attention on the more distant future in the form of a vision and programmes aimed to achieve sustainable development. On the other hand, the circumstances should cause some introspection as to the wisdom of previous development efforts involving inward investment to develop manufacturing industry based on cheap labour under a regime of liberalization. Unfortunately, none of the emergency programmes is interested in supporting any reconsideration of what might or might not be sustainable by way of development in the future - with the implication that the solution is to continue past efforts but to try harder.8

8 One USAID emergency project is entitled "Sustained Liberalization of International Trade and Domestic Competition for the Mutual Benefit of Indonesia and the United States".

The Indonesian government did sign Agenda 21. With external assistance and under the supervision of the Environment Ministry - and the rather restricted involvement of the wider public - a national Agenda 21 was also produced and published in time for the 1997 "Rio Plus Five" conference. This is a very substantial but very technical document produced with little success in gaining the attention of actors who might be in a position to implement its recommendations. Virtually no notice has been taken of the document either by the media or by relevant government agencies (those responsible for determining the form that national development should take).

The term "sustainable development" has made some headway in popular discourse, as reflected by its use in the media, but has not gained any substantive meaning. Except in a few cities (as discussed below) it is not yet part of the discourse of urban planners and authorities regarding directions that should be taken by local development programmes and projects.

Concerning political developments, it is clear that it was the economic crisis (which, in fact, included a major drought and the ecological disaster of forest burning) that precipitated the collapse of the Suharto regime in May 1998. This government, masquerading as a democratic regime, was in practice a more thoroughly organized form of authoritarianism than in either of the other two countries under review (Schwarz, 1999). Of the three permitted political parties, one was the official party with the electoral system heavily favouring its continued hold on power; it in turn elected the president. The institutional framework of government down to the community level incorporated machinery, including press censorship, designed to keep the existing political system firmly in place.

Political unrest, sometimes of a violent nature, had been growing, but in the end it was probably external pressure that convinced the military to cease supporting the president - forcing him to resign. Immediate steps were taken to start the process of genuine democratization and decentralization. However, calls for constitutional reform were resisted and the decision was to continue with an interim regime passing legislation to implement the urgent demands for reform.

Among the first reform legislation, what most interested the general public was freedom of expression and opening up the electoral process to new political parties, with the aim of having new national elections take place at the earliest opportunity. However, although of less public interest, legislation concerned with the decentralization of government and the associated redistribution of government funds enacted in April 1999 has the potential to be considerably more far - reaching in impact.

Throughout the Suharto era, government was highly centralized. Provincial governors and district heads, including urban mayors, were appointed and, although there were elected councils, these only had an advisory function. Local government was essentially central government operating at the local level - their budgets were very small, not even adequately covering staff costs, and all development costs were covered directly from central government budgets with spending determined by central government agencies. Consequently, local programmes were extremely uniform in design and implementation, and therefore often highly inappropriate, resulting in wastage of considerable resources.

The World Bank and the Asian Development Bank, with some involvement of other external development agencies, lent support to local "integrated urban infrastructure development programmes" throughout urban Indonesia, ostensibly designed to make investments appropriate to each city. Nevertheless, in practice local involvement was half - hearted in view of the lack of any genuine local ownership of the programme (Atkinson, 1998b) and major decisions concerning methods and standards of delivery remained with the central government or with external consultants.

The April 1999 legislation - to be implemented in stages until the end of 2002 - appears to change this fundamentally, leapfrogging the Thai attempts at decentralization and coming closer to the situation in the Philippines. The focus of this basic legislation is upon creating autonomous local government at the district and city levels at the expense of both central and provincial government. As in the past, elected Legislative Councils (DPRDs) are called for, but these now have a legislative function and are empowered to appoint the mayor.

Nevertheless, the umbrella legislation is very open to interpretation - seen in one analysis as still offering government the possibility to dictate local policies and programmes from the centre (SUDP, 1999). The point is that central government agencies may still issue regulations aimed at local government functions and, in practice, are doing so, but that these are now ostensibly only advisory. Local governments, unsure of how to proceed with their newly won freedom, may simply succumb to central government "advice", thereby making it equivalent to directives. This is likely at some stage to come to the courts when the more self - confident municipalities decide that they want to do things their own way.

Municipalities will also have a substantial development budget and be in a position to determine both how it should be spent and how it should be administered. Specific legislation is being enacted on combating the corruption, collusion and nepotism in government (widely discussed under the acronym of KKN - korupsi, kolusi dan nepotism) that was so structurally embedded in the old system.9 Reference in the legislation to accountability and in particular the involvement of the general public in the decision - making process is, however, sketchy, being referred to only in the regulations and then leaving the format of participation open. One mechanism referred to is that of "urban forums", which local governments are expected to organize periodically to promote discussion between government and the public.

9 The nature of "corruption" as a system of allegiance-building within government, where inadequate salaries are supplemented by payments to staff, some legal and some illegal, made by those in a position to obtain and dispose of money, is now becoming well-understood. In this light, structural measures may be taken to destroy the system and create a more public service-oriented attitude among public servants (Manning, 1999).

As yet, the legislation is in a state where it is being digested. Elections for members of both the national parliament and local legislative councils were combined and held in June 1999. The next stage will be the appointment of the mayors. So far, however, there is little understanding of how the local bureaucracy might be reorganized to suit local needs. The budget planning process in 1999 was as in previous years (a rigid system controlled by the central government), but in future years local budgeting processes will come into operation and it will be crucial to find means of planning that will genuinely respond to local needs.

So who is concerned with these issues? Looking at organizations of civil society it is a remarkable fact that, even before the collapse of authoritarianism, there was a reasonably strong NGO movement in Indonesia (Webster and Saeed, 1992). As long as they were not overtly political (and many of them were covertly so), they were tolerated and acted in many fields including legal rights, the environment and development issues (Korten, 1987). In the field of urban development there were many initiatives assisting informal communities to organize, albeit predominantly around self - help improvements (URDI, 1999) with no ambition to influence the wider decision - making process regarding the direction and allocation of resources across the town or city as a whole.

Following the fall of the Suharto regime, the floodgates opened to debate and experimentation. Many different initiatives are being developed and the paragraphs that follow focus particular attention on the case of Surabaya, Indonesia's second city located in east Java, with a population of a little under three million in a metropolitan region of almost eight million. It is important to note that Surabaya has prior experience of participatory urban planning. In the 1970s a low income settlement upgrading programme was implemented within the general framework of the KIP (encompassing two thirds of the city's population). This was unlike other Indonesian cities where measures were determined by bureaucrats and their consultants. In Surabaya there were genuine experiments with participatory methods of determining what should be done and how to do it (Silas, 1992). The circumstances that encouraged this were an enlightened mayor working closely with the Surabaya Institute of Technology (ITS) within what is the most affluent municipality in Indonesia.

With a new mayor, appointed in the early 1990s, the participatory approach declined. After the fall of the regime, newly vocal local NGOs accused the old programme of being interested only in self - help and local improvements, rather than empowerment of poor communities to be able to make broader demands on the political system.

In the spring of 1997 a German government - supported project was initiated in Surabaya with the intention of assisting in the development of participatory decision - making processes around improvements in the quality of life at the community level; in the first instance this was to be little more that building on and systematizing the earlier KIP experience. Four communities were selected out of an initial 12 via wide consultation. Universities were commissioned to organize rapid appraisals of the communities, including a stakeholder analysis to help bring together a "forum" that would represent main groupings within the communities and be trained in local planning. The formation of Environmental Communication Forums (FKLHs), followed by a process of training and involvement of the wider community, was organized by local NGOs and the results were twofold - the production of local plans and more aware and vocal communities able to make structured demands of the municipality.

There is always a danger that such initiatives can collapse if the plans are not implemented. While the intention was that these decision - making forums would come to occupy a place in the overall budget planning for the city, this was certainly not immediately on the cards. Some city departments co-operated, including the city water supply corporation. Then the project succeeded in collaborating with the emergency programme of the national Public Works Department, which had to disperse large amounts of money in a short period and was happy to find local ventures into which they could channel their funds.

But it was clear that these - in the first instance predominantly self - help - initiatives would die once the project ended unless there were a considerably more coherent institutional framework within which they would have an ongoing place and function. Already before the collapse of the old regime, the project was attempting to bring together key stakeholder groups at the city level. This had the intention of bringing into existence a more or less formal pressure group to voice the concerns of civil society - and promote the local community plans - at the level of the city authorities. Whether this could have worked under the old regime is a moot question.

With the collapse of the regime the intended forum - initially christened Sustainable Development Forum (FKPB) - immediately initiated debate around issues that should become the focus of reformed local government. Indeed, both the mode of organization of the community initiatives and the FKPB became the focus of attention of the now reform - minded central government and external assistance agencies as indicating possibilities for public participation in local government decision making. USAID immediately undertook to assist a number of other cities in east Java to establish FKPBs albeit with close ties to government.

However, as we have seen in the cases of the Philippines and Thailand, the abandonment of authoritarianism does not immediately bring clear reform. Of particular interest in the local debate in Surabaya is the insistence of the FKPB to be independent of government. Some NGOs accuse it of wanting to collude with government even before it has taken any substantive initiative to do anything in collaboration with local government. The fear of co-optation that was so often the experience of NGOs in the past when they attempted to promote civil society interests is strong and even private sector and university participants in the process steer a careful path. The initial preference is to advise the newly democratic Legislative Council rather than to engage directly with the machinery of local government.

On the other hand, it is clear that, at this point in time, the field iswide open to non - government initiative to help define what local government is to become in the future. If, however, local government is left to its own devices there is a real danger that entrenched interests will succeed in establishing local authoritarianism as is evident in so many local authorities in the Philippines and Thailand.

In fact, the preoccupations of the FKPB - and one might say of the local forces of reform more generally - are not yet oriented towards "sustainable human development" in any very coherent way. The initial priorities of the FKPB are environmental pollution, land and settlement including tenure, the informal economy and provision of public services. Work is proceeding actively on the first two issues partly because there happen to be people active in these issues. While it is clear that these - and particularly the issue of land - are relevant to the needs of the poor and possibly also to achieving a more sustainable city, in practice, the debates remain at some distance from the prima facie needs on either score.

The FKPB is not making common political cause with the poor: attempts to involve the interests of the poor (for example, associations of informal traders and pedicab drivers) have not been successful and membership of the forum is, with the exception of a very active trade union representative, exclusively "new middle class", albeit with some young and active NGO people.10 Although originally named the Sustainable Development Forum there seem to be too many urgent issues to be dealt with to be able to focus serious attention on what might constitute a coherent and effective approach to sustainable development. The result is that after one year in existence the Forum renamed itself simply the Surabaya Urban Forum (FKS) in order to be seen as more mainstream and meriting a central position in the emerging system of local government.11

10 The importance of youth as the driving force of the reform process in Indonesia at present can hardly be overstressed, where much of the new middle class is too tainted with KKN to be seriously committed to fundamental reform.

11 The new legislation calls for the convening of forums as a means of communication between municipalities and other stakeholder groups. In fact the legislators already had the Surabaya experience in mind; now the members of the FKS wish to ensure that they are seen as the legitimate body to fill this role!

In other towns and cities throughout Indonesia, similar experiments and experiences are unfolding spontaneously (active NGOs working with local government) or with external assistance. Indeed, the growth in assistance programmes as a consequence of the emergency has meant that programmes are tripping over one another in all the major cities. It thus becomes advisable (this is happening in Surabaya) to hold regular co-ordination meetings among the various initiatives with, even then, a constant danger of contradictory initiatives and wastage of resources. Most of the effort (such as the massive World Bank and Asian Development Bank poverty alleviation programmes designed to channel money directly into local communities) is focused on improvements to the environment of poor communities - essentially KIP based on new participatory decision - making processes.

Much of this experience encounters the inevitable contradictions between large - scale programmes and the need to be sensitive to local contingencies, which often takes more time to resolve and greater sensitivity to specific local circumstances than such programmes are prepared to countenance. Furthermore, they have little or no interest in empowering communities in the sense of orienting them to voice their needs in the wider political process.

These ostensibly participatory initiatives could potentially be very counterproductive. There is a tendency for agencies to bypass local authorities and work directly with the community. Some local authorities may attempt to use the freedoms and opportunities created by the recent decentralization laws by adopting new forms of command - oriented government with perfunctory measures of public consultation designed to legitimate their own activities rather than respond to locally expressed needs. But there are also various attempts to work at the city and provincial level, as in the case of the FKS in Surabaya, to devise means to ensure that the local governments of the future are held accountable and do have a more positive orientation towards participation and sustainable development.