Friday, March 11, 2011

Explosive WikiLeaks Cables Expose Yudhoyono

US embassy in Jakarta has serious doubts about the Indonesian president's own integrity

When Susilo Bambang Yudhoyono won a surprise victory in Indonesia's 2004 presidential elections, the United States Embassy in Jakarta hailed it as "a remarkable triumph of a popular, articulate figure against a rival [incumbent president Megawati Sukarnoputri] with more power, money, and connections."

The former army general and security minister has gone on to win international accolades for strengthening governance, promoting economic reform, and his efforts to suppress the Islamic militant group Jemaah Islamiyah.

While visiting Jakarta last November, US President Barack Obama applauded Indonesia's democracy and "the leadership of my good friend President Yudhoyono."

However Yudhoyono's record may have to be reviewed after secret US embassy cables, leaked to WikiLeaks and provided to Fairfax Media, reveal allegations of corruption and abuse of power that extend all the way to the presidential palace.

According to the diplomatic cables, Yudhoyono, widely known by his initials SBY, personally intervened to influence prosecutors and judges to protect corrupt political figures and put pressure on his adversaries. He reportedly also used the Indonesian intelligence service to spy on rivals and, on at least one occasion, a senior minister in his own government.

Yudhoyono's former vice-president reportedly paid out millions of dollars to buy control of Indonesia's largest political party, while the President's wife and her family have allegedly moved to enrich themselves on the basis of their political connections.

The US embassy's political reporting, much of it classified "Secret/NoForn" – meaning for American eyes only — makes clear that the continuing influence of money politics, which extends, despite the President's public commitment to combating corruption, to Yudhoyono himself.

The US embassy cables reveal that one of Yudhoyono's early presidential actions was to personally intervene in the case of Taufik Kiemas, the husband of former president Megawati Sukarnoputri. Taufik reportedly used his continuing control of his wife's Indonesian Democratic Party (PDI-P) to broker protection from prosecution for what the US diplomats described as "legendary corruption during his wife's tenure."

Taufik has been publicly accused, though without charges being laid against him, of improper dealings in massive infrastructure projects heavily tainted with corruption. He is believed to have profited from deals relating to the US$2.3billion Jakarta Outer Ring Road project, the US$2.4 billion double-track railway project from Merak in West Java to Banyuwangi in East Java, the US$2.3billion trans-Kalimantan highway, and the US$1.7 billion trans-Papua highway.

In December 2004, the US embassy in Jakarta reported to Washington that one of its most valued political informants, senior presidential adviser TB Silalahi, had advised that Indonesia's Assistant Attorney-General, Hendarman Supandji, who was then leading the new government's anti-corruption campaign, had gathered "sufficient evidence of the corruption of former first gentleman Taufik Kiemas to warrant Taufik's arrest."

However, Silalahi, one of Yudhoyono's closest political confidants, told the US embassy that the president "had personally instructed Hendarman not to pursue a case against Taufik."

No legal proceedings were brought against the former "first gentleman," who remains an influential political figure and is now speaker of Indonesia's parliament, the People's Consultative Assembly.

While Yudhoyono protected Taufik from prosecution, his then vice-president, Jusuf Kalla, allegedly paid what the US embassy described as "enormous bribes" to win the chairmanship of Golkar, Indonesia's largest political party, during a December 2004 party congress, US diplomats observed firsthand.

"According to multiple sources close to the major candidates, Kalla's team offered district boards at least Rp200 million (over US$22,000) for their votes," the US embassy reported. "Provincial boards — which had the same voting right, but also could influence subordinate district boards — received Rp500 million or more. According to one contact with prior experience in such matters, board officials received down payments ...and would expect full payment from the winner, in cash, within hours of the vote."

US diplomats reported that, with 243 votes required to win a majority, the Golkar chairmanship would have cost more than US$6 million.

"One contact claimed that [then Indonesian House of Representatives chairman Agung Laksono] alone — not the wealthiest of Kalla's backers — had allocated (if not actually spent) Rp50 billion (more than US$5.5 million ) on the event." The US embassy cables further allege that Yudhoyono had then cabinet secretary Sudi Silalahi "intimidate" at least one judge in a 2006 court case arising from a fight for control of former president Abdurahman Wahid's National Awakening Party (PKB). According to the embassy's contacts, Sudi told the judge "if the court were to help [Wahid] it would be like helping to overthrow the government."

The intervention of "SBY's right-hand man" was not successful in a direct sense because, according to embassy sources with close ties to the PKB and lawyers involved in the case, Wahid's supporters paid the judges Rp3 billion in bribes for a verdict that awarded control of PKB to Wahid instead of a dissident faction. However, Yudhoyono's strategic objective was achieved as external pressure on Wahid's "precarious position" forced the PKB to reposition itself to support the administration.

Other US embassy reports indicate that Yudhoyono has used the Indonesian State Intelligence Agency (BIN) to spy on both his political allies and opponents.

The president reportedly also got BIN to spy on rival presidential candidates. This practice appears to have begun while Yudhoyono was serving as co-ordinating minister of political and security affairs in former president Megawati's government. He directed the intelligence service to report on former army commander and Golkar presidential candidate Wiranto. Subsequently, at a meeting of Yudhoyono's cabinet, BIN chief Syamsir characterised Wiranto as a "terrorist mastermind."

Through his own military contacts Wiranto learnt that he was the subject of "derogatory" BIN reports, but when he complained he was told by presidential adviser TB Silalahi that no such reports existed.

The leaked US embassy cables are ambiguous on the question of whether Yudhoyono has been personally engaged in corruption. However, US diplomats reported that at a 2006 meeting with the chairman of his own Democratic Party, Yudhoyono "bemoaned his own failure to date to establish himself in business matters," apparently feeling "he needed to ‘catch up' ... [and] wanted to ensure he left a sizeable legacy for his children."

In the course of investigating the President's private, political and business interests, American diplomats noted alleged links between Yudhoyono and Chinese-Indonesian businessmen, most notably Tomy Winata, an alleged underworld figure and member of the "Gang of Nine" or "Nine Dragons," a leading gambling syndicate.

In 2006, Agung Laksono, now Yudhoyono's Co-ordinating Minister for People's Welfare, told US embassy officers that TB Silalahi "functioned as a middleman, relaying funds from Winata to Yudhoyono, protecting the president from the potential liabilities that could arise if Yudhoyono were to deal with Tomy directly."

Tomy Winata reportedly also used prominent entrepreneur Muhammad Lutfi as a channel of funding to Yudhoyono. Yudhoyono appointed Lutfi chairman of Indonesia's Investment Co-ordinating Board.

Senior State Intelligence Agency official Yahya Asagaf also told the US embassy Tomy Winata was trying to cultivate influence by using a senior presidential aide as his channel to first lady Kristiani Herawati.

Yudhoyono's wife and relatives also feature prominently in the US embassy's political reporting, with American diplomats highlighting the efforts of the president's family "particularly first lady Kristiani Herawati profit financially from its political position."

In June 2006, one presidential staff member told US embassy officers Kristiani's family members were "specifically targeting financial opportunities related to state-owned enterprises." The well-connected staffer portrayed the President as "witting of these efforts, which his closest operators (e.g. Sudi Silalahi) would advance, while Yudhoyono himself maintained sufficient distance that he could not be implicated."

Such is the first lady's behind-the-scenes influence that the US embassy described her as "a cabinet of one" and "the President's undisputed top adviser."

The embassy reported: "As presidential adviser TB Silalahi told [US political officers], members of the President's staff increasingly feel marginalised and powerless to provide counsel to the President."

Yahya Asagaf at the State Intelligence Agency privately declared the first lady's opinion to be "the only one that matters."

Significantly, the US embassy's contacts identified Kristiani as the primary influence behind Yudhoyono's decision to drop vice-president Kalla as his running mate in the 2009 presidential elections.

With Bank of Indonesia governor Boediono as his new vice-presidential running mate, Yudhoyono went on to an overwhelming victory. The president secured more than 60 per cent of the vote, defeating both former president Megawati, who had teamed up with former special forces commander Prabowo Subianto, and vice-president Kalla, who allied himself with Wiranto.

In January 2010 the US embassy observed: "Ten years of political and economic reform have made Indonesia democratic, stable, and increasingly confident about its leadership role in south-east Asia and the Muslim world. Indonesia has held successful, free and fair elections; has weathered the global financial crisis; and is tackling internal security threats."

However, America's diplomats also noted that a series of political scandals through late 2009 and into 2010 had seriously damaged Yudhoyono's political standing.

A protracted conflict between the Indonesian police and the national Corruption Eradication Commission had damaged the government's public anti-corruption credentials, while a parliamentary inquiry into the massive bailout of a major financial institution, Bank Century, called into question the Vice-President's performance as former central bank governor.

One prominent anti-corruption non-government organization privately told the US embassy that it had "credible" information that funds from Bank Century had been used for financing Yudhoyono's re-election campaign.

Former vice-president Kalla strongly criticized the bailout, alleging that the Bank of Indonesia under Boediono had been negligent in supervising Bank Century and arguing that the bank should have been closed as its failure was due to fraud perpetrated by major shareholders.

Against this background the US embassy reported that Yudhoyono was increasingly "paralyzed" as his political popularity rapidly diminished.

"Unwilling to risk alienating segments of the parliament, media, bureaucracy and civil society, Yudhoyono has slowed reforms. He is also unwilling to cross any constituencies ...Until he is satisfied that he has shored up his political position, Yudhoyono is unlikely to spend any political capital to move his reform agenda, or controversial aspects of US -Indonesia relations, forward."

Over the past 13 years Indonesian democracy has undoubtedly strengthened. The Suharto dictatorship has been replaced by a competitive political system characterized by robust debate and free media.

However, as the leaked US embassy's reports show, in what is only a glimpse of the inside workings of President Yudhoyono's tenure, some of the secretive and corrupt habits of the Suharto years still linger in Indonesian presidential politics. Written by Philip Dorling

Another version of this story appeared in The Age in Melbourne, Australia.


  1. How Should SBY React to Leaked Cables?

    by Anita Rachman

    If senior political figures, including President Susilo Bambang
    Yudhoyono, plan to fight explosive allegations about them in US
    cables leaked on Friday, they had better find credible data to
    back them up, analysts have warned.

    The Age, an Australian newspaper, on Friday published a report
    based on a series of secret cables released to it by WikiLeaks,
    revealing US diplomats’ views on various figures and including a
    note from the US Embassy in Jakarta that it had doubts about the
    integrity of Yudhoyono himself.

    J. Kristiadi, an analyst from the Center for Strategic and
    International Studies, said the government was now in a duel
    with The Age. “They are competing to provide credible data,” he

    Kristiadi said he was unsure how much damage the leaks would do
    to the president and his government because the country’s image
    was already not very clean, but he believed ties with Australia
    and the United States would not be affected.

    He said the government should not panic, stop dismissing the
    reports and instead prove to the public that the allegations
    were false. Various officials, including some close to the
    president, have denied the allegations, but so far, no one has
    provided decisive supporting evidence.

    Ikrar Nusa Bhakti, a political observer at the Indonesian
    Institute of Sciences (LIPI), said Yudhoyono was a darling of
    Canberra and was unlikely to make a fuss to the Australian
    government about the report.

    He said Yudhoyono’s administration had been less truculent than
    past governments that had canceled ministerial visits and even
    closed access to shipping lanes in Indonesian waters because of
    critical media reports.

    However, he said the president needed to provide a
    clarification, backed by credible facts. The reports, he added,
    “seem, to a certain degree, to be correct, because the
    information came from his aide. If he wants to be angry, the one
    he should go after is his aide, not The Age.”

    Burhanuddin Muhtadi, an analyst with the Indonesian Survey
    Institute (LSI), said it was unlikely Indonesia-US ties would be
    affected by the leaks, but that Yudhoyono might feel
    disappointed because he had been trying to foster better
    relations with the United States while its diplomats were busy
    spying on him.

    “The president will also find problems concerning his good
    image, which he is known to have been carefully building,” he

    Burhanuddin also said the government’s knee-jerk response to the
    leaks was only fueling speculation. State officials, he said,
    should have remained calm and simply dismissed the cables as
    “raw material.”

    Meanwhile, Airlangga Pribadi, a political analyst from
    Surabaya’s Airlangga University, said both the State Palace and
    government should be transparent in their probe of the

    Failure to do that, he said, would only strengthen people’s
    distrust of Yudhoyono, eventually compromising his popularity
    and his policies.

  2. Jusuf Kalla Admits There Is Some Truth to Wikileaks Allegation

    Former Vice President Jusuf Kalla admitted on Friday that there
    was some truth to an allegation, released by Wikileaks and
    published today in Australia's The Age newspaper, that he had
    "distributed" money to Golkar Party members when he was elected
    party chairman during Golkar's 2004 convention in Bali.

    The claim, published today in The Age in an article titled
    “Yudhoyono 'Abused Power,'” accused Kalla of paying “enormous
    bribes” to win the chairmanship.

    According to the article, a cable from the US embassy said
    multiple sources had revealed that Kalla's team had offered
    district boards at least Rp 200 million ($23,000) for their

    "Provincial boards — which had the same voting right, but also
    could influence subordinate district boards — received Rp 500
    million or more. According to one contact with prior experience
    in such matters, board officials received down payments... and
    would expect full payment from the winner, in cash, within hours
    of the vote,” the article claimed.

    Jusuf Kalla said on Friday that the allegation was not
    altogether false.

    “Yes, [I spent] between Rp 2 billion to Rp 3 billion,” Kalla
    told news portal on Friday.

    He said the money was used to pay for the plane tickets of 3,000
    Golkar officials from all over Indonesia. He also paid for the
    hotel where the convention took place.

    However, he said it was customary for the elected Golkar
    chairman to pay for the plane tickets and hotel.

    “Almost every political party does it. It's not a secret,” he
    said. “I used my own money, not corruption money,” he said.

    Kalla is not the only Golkar official mentioned in the
    newly-revealed cables. They also claim that then Indonesian
    House of Representatives chairman Agung Laksono had allocated Rp
    50 billion for the convention.

  3. Yusril 'not surprised' by reports of SBY spying

    Former state secretary Yusril Ihza Mahendra says he is not
    surprised about the revelation of US diplomatic cables that
    allege President Susilo Bambang Yudhoyono used official channels
    to spy on him during his tenure in Cabinet.

    The Presidential Palace, however has denied the legitimacy of
    the cables, published in a headline news report in Australia’s
    The Age newspaper on Friday.

    “I'm really not that surprised with the news because I have long
    felt this,” Yusril said Friday, as quoted by

    Yusril added that he was disappointed because he had been among
    Yudhoyono's main supporters when the latter ran for president in

    “Along with Democratic Party executive Boedisantoso and General
    Eddy Sudrajat, I was among those who signed SBY's nomination to
    become President during his registration at the General
    Elections Commission.

    “I don't understand why I was considered a rival who had to be
    spied on. As a close friend, I consider that step barely
    ethical,” Yusril said.

    Among the information revealed in the report, The Age says
    Yudhoyono directed State Intelligence Agency (BIN) chief Syamsir
    Siregar to monitor Yusril during a secret trip to Singapore to
    meet Chinese businessmen.