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Indonesia: Workers, poor reject petrol price rises imposed `on behalf of the poor’

May 15, 2008 -- ``Let’s seek the opportunity out of the world's crisis. In responding to the increase in global food prices, let us improve productivity. Amidst the oil crisis and price rises, let's be thrifty. Let's develop the energy resources.'' -- Indonesian President, Susilo Bambang Yudoyono, May 1, 2008.

The poor will benefit from the increase in fuel prices rise, he said on May 7, 2008.

Meanwhile vice-president Yusuf Kalla said that so far the fuel subsidy has been benefiting the rich. He added ``The protesters who oppose this policy mean that they are helping the poor.''

Acting as if they are doing it ``on behalf of the poor'', the Indonesian government plans to impose a 30% rise on petroleum prices. It will be the third oil price rise under the Susilo Bambang Yudoyono government. To help the poor survive this unpopular policy, the government is granting direct cash transfers amounting 100,000 rupiah per month per family. The direct cash transfer ``gift'' was also implemented with the oil price rise in 2005.

Will this price rise benefit the poor?

How about the increasing of poverty rate under this government? Currently, 40 million people, nearly a quarter of Indonesian population, are living under poverty line. Year on year inflation rate (to April) is 8.7%, mostly in food and energy price increases. Sofyan Wanadi, member of Indonesian Employers Association (Apindo), admitted that the petroleum price rise has reduced purchasing power and is a threat to industry. The state budget allocation to pay foreign debts will absorb nearly US$90 billion compare to $46.7 billion allocated for the petroleum subsidy.

It takes independence to set people free from oil crisis.

In anticipating the world oil price rise, Indonesian government likely to have favourite instant solution, increase the country's daily oil andd gas production, which is 979 barrels. Even the oil and gas department has said it is likely climb to 1 million barrels per day in July from the new exploration in Cepu.

Meanwhile 90% of mining and oil corporations are owned by foreign companies. Chevron and Exxon are benefiting from the doubling in petrol prices, while the Indonesian people are lining up desperately for a litre of petrol.

If you visit Riau province, you will be amazed at the extent of Chevron large exploration area and offices, palm plantations as well as wood plantations. But you will also be shocked to find that the majority of the people in the hundred-thousand-hectare area of Riau subdistricts have no access to electricity. It is 14 kilometres to reach the closest petrol station to be able to put fill a two-litre diesel fuel can to operate their generator. Therefore most of must stay in the dark from afternoon to dawn. While Chevron's exploration, dormitories and office complexes are enjoying bright lights day and night.

Poor refusing their `gift'

On May 11, 300 protesters from the Indonesian Poor People's Union (SRMI) marched to Yusuf Kalla's house in South Sulawesi to oppose the petroleum price rise. They continued their march to the local House of Representatives. ``Do not say that this is for the poor, the experience has taught us that this policy has trapped the poor in deeper poverty'', Said Anca, Papernas' (National Liberation Party of Unity) South Sulawesi leader.

On May 12, 3000 protester's from SEGERA (Central Movement of the Riau People) surrounded to the local House of Representatives. In this two-day demonstration, they urged government to nationalise the mining and oil industries, as well address concerns about local land disputes.

The workers, farmers and the poor, who are also members of the National Liberation Party of Unity (Papernas) took six to eight hours to drive from their settlements to the local House of Representatives building. They surrounded the house of representatives, chanting the slogan ``Enough of being a coolie nation, now it is time to be an independent nation.'' Papernas chairperson Agus Priono said that selling out the national assets is a violation of the constitution. ``To rescue Indonesia from the trap of the crisis we must radically change economic policy from a pro-capital policy to pro- people policy'', she told the crowd. After succeeding in passing the police barricades, the protesters stayed and erected a tent near the House of Representative.

Papernas, the National Liberation Party of Unity

Jln. Tebet Dalam IIG No. 1, Jakarta Selatan, 12820.Indonesia.

Phone/Fax: +62-21-8354513. Email:


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