Lipsky, Seth; Pura, Raphael
September 1978
Foreign Affairs;Fall1978, Vol. 57 Issue 1, p186
This article examines the New Order initiative of Suharto during his third term as president of Indonesia. During the 1960s, Suharto and the Army took power and ended the guided democracy of the Sukarno era as well as Indonesia's flirtation with the Soviet Union and China. At the time, Suharto made a monumental strategic decision, gambling the development of the world's fifth most populous nation on a partnership with the free market economies of the U.S., Japan and Europe. His New Order brought political stability and some economic progress. Indonesia took more effective control of its own oil and other natural resources. Soon soaring oil prices brought a wave of optimism that convinced many that Indonesia might be able to hoist itself dramatically and suddenly from poverty. But then came a worldwide recession. The engine of Suharto's development program, the state oil company Pertamina, derailed, wrecking the illusion that somehow oil would prove a magic balm for the nation's problems. In the 1970s, as Suharto begins what will probably be his last term, his New Order is facing a testing time. Indonesia's problems of population, food and jobs are looming more starkly than ever; around them center many of the themes voiced by his detractors at home. The years ahead are likely, as well, to plumb the West's commitment to official aid programs and to test anew the commitment of private enterprise to a responsible role in a nation that has always held a special allure for those seeking riches from the East. Suharto's third term is shaping up as a test of the very worthiness of the West as a partner in development.


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