Page 8 - FMH7

On Gentrification in Jakarta:
Abidin Kusno
From what others have told me the development/gentrification processes in Indonesia start from a general government plan of ‘modernization’, but the specifics are mainly left in the hands of private developers, with little central government planning. Do you think this is an accurate summary?
A: This summary makes sense but not nuanced enough to capture the political relation between the nation-state and the city [especially in the Suharto era (1966-1998) which has left a strong legacy of development culture]. Indonesian government tends to plan and measure development nationally (-therefore it has BAPPENAS – a national planning board) but it doesn’t have a functioning urban (or mega-urban/regional) planning board (-there is a coordinating board for the Jakarta metropolitan area, but it is powerless). This gap has been noted by policy makers, but it is private developers who are making maximum use of this “looseness” in the urban governance institution. I put quotation mark because the “looseness” is politically motivated so that
the powerful central government of the Suharto era could (work together with developers to) take over urban/local decision for its own economic and political gains. Indonesia’s post-Suharto’s decentralization policy has given power to the local/city govern- ments, but it has also further fragmented them especially when the context of decentralization is over-determined by interests in maximizing local income and attracting capital investment.
Two people that I have interviewed previously, Anissa S Febrina and Kemal Taruc have both underlined the point that “....since the 1970s the Indonesian government chose laissez faire capi- talism as fundamental tenet of economic growth: leaving these developments mostly in the hands of the private sector with little regulation”. Can you comment on this?
Questions by Z. Szumer
state “gentrification” project of the city (-though the Dutch colonial government had done some of this type of physical upgrading in the 1920s). The point is that there is no such thing as neoliberal’s “withdrawal of the state” as the state has continued to facilitate and make use of the private sector on matters concerning urban development.
It is generally correct to say that the Suharto government has given rise to capital (to overcome Sukarnoist anti-capitalist influence), but it is interesting to see Suharto’s own remark that the aim was to harness capital (and not be enslaved by it). Suharto’s political culture and the subsequent Indonesia’s engagement with capital can only be adequately understood through a patron-client tradition of Southeast Asia which today has evolved into a nationalist oligarchy. Debating neoliberalism without making reference to this oligarchic patron-client tradition can be misleading for it ends up with a reductive account of state and market opposition. The post- Suharto’s debate on neoliberalism has not been productive for it tends to be based on whether the state should stay with or withdraw itself from the market. The IMF’s view is that the oligarchic state has distorted the market, so a more pro-mar- ket regime should be installed. If we look at the president’s economic team in the past ten years (especially prior to the current Jokowi government), we can say that the neoliberal – pro-market – force is at work. However, we can also say that what is going on is the expression of oligarchic tradition (-see how Bakrie has grown from a businessman into a politician). In other words, what we have is a continuation of (rather than rupture from) Suharto’s New Order economic order.
A: Let me first share a note on the 1970s government’s strate- gies on developing the housing sector which would give a sense of whether development is mostly in the hands of the private sector. In 1972, Suharto government held a national workshop on housing (after the first “socialist”- oriented housing congress in 1950) which produced some key decisions on housing. Private developers were encouraged (via the issuance of “Location Permits”) to acquire land to develop upper-middle class housing. Developers moved fast to quickly set up the Real Estate Indo- nesia to consolidate their position), and the government on the other hand established its own housing company PERUMNAS (National Housing) to take care of housing for lower income populations (-though in practice largely targeting lower rank
Do Indonesians living in Jakarta see the urban development in terms of this debate? Most know perfectly well that they are living in an urban environment that has become worse – flooding, traffic congestion, and almost no public space (ex- cept the public-oriented private shopping malls). Yet they are also seeing more spectacular new shopping malls and luxuri- ous condominiums coming up in the city. Meanwhile the informal land market which has sustained kampung for a very long time is disappearing due to land certification (-which itself is a form of gentrification). The wild force (of capital) continues to circulate in the city. People however expect
civil servants). Meanwhile the majority of the urban poor were “permitted” to live on lands operated under informal land market in kampung. Supports of kampung came through Kampung Improvement Project (KIP – started 1968, ended in late 1990s?) with funds from the World Bank. The KIP was probably the first
the government to do something... to balance development. We saw this call in the recent election. The current populist government is indeed trying to show that they can control the force of capital ... meanwhile private developers’ strategy of going “back to the city” continues to transform urban space in the image of a global city, and this has forced the govern- ment to play only a catch up role with infrastructure develop- ment (toll roads, MRT, deep tunnel, seawall, etc.) and welfare programs in the form of health care and education to give an impression of a balanced development.