Hope on horizon

FOR THE PAST four years the United States-Indonesia Business Committee has dispatched a delegation of US investors to Indonesia to meet with policymakers. In that time they have met with three presidents and when they return in a few months they will sit down with a fourth.

The latest incumbent in the presidential hot seat is Megawati Sukarnoputri, daughter of founding president Sukarno. After a debilitating year-long struggle against ex-president Abdurrahman Wahid, Ms Megawati succeeded in overseeing the impeachment of her boss last week and vaulted from the vice-presidency into the top job.

Her long-awaited elevation has spawned predictable hopes that Southeast Asia's most populous country may at last emerge from a crisis that stretches back to the fall of the Suharto regime in 1998. The dictator's fate was fuelled by the regional financial crisis as the rupiah swooned and corporate debts ballooned.

Since then political tumult and economic stagnation have operated in a destructive alliance. As presidents have come and gone instability has spread, economic growth has nose-dived, confidence has evaporated and reform has all but stalled.

Like many other investors, the US representatives heading to Jakarta in October are upbeat about prospects for a much-needed economic renaissance under Ms Megawati's leadership. Already significantly exposed in the country, corporations including oil giant Unocal, power systems and engine-maker General Electric (GE) and miner Freeport-McMoRan Copper and Gold have much to gain from a more stable Indonesia. 'We intend to move quickly to support the new government in its efforts to build a business environment that will sustain increasing levels of prosperity in Indonesia,' said Michael Gadbaw, vice-president of GE and chairman of the committee. 'With the transfer of power in Indonesia behind us, we hope to reinvigorate the economic/business policy discussion. The October mission will make for an excellent opportunity.'

Foreign academics have also been keen to sound a positive note. Writing in The Jakarta Post R. William Liddle, professor of political science at Ohio State University, said that Ms Megawati stood a better chance of making a positive contribution to the economy than in any other area of decision-making.