From Third World to First The Singapore Story pdfdrive com

empat
mata
(four eyes). Just the two of us, without interpreters or note-takers, we could
speak frankly. My Malay was adequate for the purpose. Although I did not speak
elegant Bahasa Indonesia, I understood him and could make myself understood.
We talked for more than one hour.
Suharto made clear his determination to get Indonesia moving after 20 years
of neglect. He said he appreciated that Singapore could assist in this Herculean
task of rebuilding Indonesia and recognised the quality of the Singapore
leadership. He gave me the impression that he was likely to treat us correctly,
even cordially, based on a realistic assessment of the relative strengths and
weaknesses of our two countries.
On my part, politely and tactfully, I made it clear that we expected to be part
of Southeast Asia as of right, not on sufferance. We could not yield on
fundamental interests like free passage through the Straits of Malacca. Economic
cooperation must be on the basis of a fair quid pro quo, not the kind of
relationship Indonesian leaders had with their Chinese 
cukong
. (These
“compradores” had to pander to the needs of their patrons in return for
franchises or licences on which they would become wealthy.) I said that at the
heart of the relationship, the question was whether we trusted each other’s long-
term intentions.
He made clear that Indonesia had no claims to Singapore or Malaysia and
claimed only those territories that had belonged to the Dutch East Indies. He was
determined to concentrate on the development of Indonesia, not on foreign
adventures. Most important of all, he distrusted the communists, especially
Chinese communists, who had been the cause of much trouble in Indonesia. I
said the Chinese communists were out to destroy us through their proxy, the
Malayan Communist Party. I was determined that they should not succeed. I did
not want China’s influence to extend to Southeast Asia. That was the bull point
with him. He accepted my good faith on this.
I saw in him a careful, thoughtful man, the exact opposite of Sukarno. He
was no extrovert. He did not set out to impress people with his oratory or his
medals, although he had many. He maintained a humble, friendly appearance,
but was clearly a tough-minded man who would brook no opposition to what he

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set out to do. I liked him and felt that I could get on with him.
A year later, in August 1974, Suharto returned my visit. At the airport I
reciprocated the welcome he had given me in Jakarta with a 21-gun salute and a
400-man guard of honour from the army, navy, air force and police. The
highlight of his visit was an exchange of documents of ratification relating to
Singapore-Indonesia territorial sea boundaries. Once again the key meeting was
empat mata
with Suharto. He made his points in Bahasa Indonesia, without
notes. He was so intent on expressing what was on his mind that two
interruptions for tea and cakes irritated him. First was the “archipelago concept”.
Indonesia, like several other island nations, claimed territorial jurisdiction over
all waters between its islands. Asean members must show solidarity and unity in
support. Then he gave an assessment of Indonesia’s economic prospects and
difficulties.
I replied that Singapore’s predominant interest in the archipelago concept
was freedom of passage. We were a part of Southeast Asia. We had been
expelled from Malaysia. We had to create a new basis for our livelihood, and
this required maritime lifelines to America, Japan and Western Europe. Any
impediment to free navigation would destroy us. Therefore we could support the
archipelago concept provided there was a public declaration by Indonesia on the
traditional freedom of navigation. We made no claims to oil or other mineral
resources on the sea-bed.
He asked for my views on the war in Vietnam. I said the outlook had turned
pessimistic since we met a year ago. Nixon had resigned and whatever President
Ford might want, the US Congress was determined to slash aid to Vietnam and
Cambodia by half. I doubted that these two regimes would last. He appeared sad
at my bleak assessment.
I feared that instability in Thailand, after Vietnam and Cambodia became
communist, would cause deep problems for Malaysia and Singapore. Singapore
might be more than 75 per cent Chinese but we were a part of Southeast Asia. I
would not allow China or Russia to make use of us. He was clearly reassured by
this.
The next day, addressing over 1,000 Indonesian nationals at his embassy, he
said in the presence of the press that because of Indonesia’s limited expertise his
government was seeking technical help and investment capital from everywhere,
including Singapore. By publicly accepting Singapore as an equal, independent
state, one with a contribution to make to Indonesia’s development, he had
signalled a major change in attitude towards Singapore.

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After the fall of Phnom Penh and Saigon, I met Suharto in September 1975
in Bali. The communists were on the ascendant and the tide looked like flowing
over the rest of Southeast Asia. Razak had visited Beijing in May 1974 and
established diplomatic relations. Malaysia had recognised the Khmer Rouge
government in Phnom Penh immediately after they captured it. With
disappointment in his voice, Suharto said he had told Razak of Indonesia’s bad
experiences with Beijing, referring to China’s support for the Indonesian
Communist Party’s attempted coup in September 1965. He had said the same to
Thai Prime Minister Kukrit Pramoj in Jakarta. Then Kukrit visited Beijing in
June 1975, two months after the fall of Saigon, and established diplomatic
relations. Suharto saw things getting worse in Malaysia and in Thailand. If
Asean continued such disparate policies, each rushing on its own to give
recognition to the new communist government in Vietnam and to the Khmer
Rouge, he believed the will to stand up to the communists would be lost. He
noted that Singapore and Indonesia held similar views and found themselves
akin temperamentally. We were not overreacting by courting Indochina, or
making flamboyant speeches as President Marcos had done recently in Beijing,
praising that communist regime.
Although the security of Asean was uppermost in our minds, we agreed that
Asean should emphasise cooperation in the economic and political field, and
play down security. We would quietly cooperate, especially on intelligence.
Indonesia and Singapore should consolidate their respective capabilities and wait
for a more propitious time for Asean economic cooperation. He did not mention
East Timor, which Indonesia was to occupy two weeks later. It was a good
meeting. When faced with sudden reverses in the region, our reactions were
similar.
But three months later, because Singapore abstained in a vote at the United
Nations on Indonesia’s occupation of East Timor, a second chill descended on
our relations. Other Asean members had voted with Indonesia. Indonesia’s army
leaders boycotted our receptions in Jakarta for Singapore Armed Forces Day and
National Day. Our counsellor in Jakarta reported that several generals said
Suharto had been more angered than over the hanging of the two marines.
A year passed before personal rapport was reestablished when Suharto
visited Singapore, unofficially, on 29 November 1976. I said Singapore would
not put obstacles in the way of Indonesia’s day-to-day relations with Timor; we
accepted Timor as a part of Indonesia, but we could not publicly endorse its
invasion and occupation. He accepted my position that if we had voted with

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Indonesia we would have sent the world a wrong signal about our own security.
What pleased him was an unrelated matter; I agreed to provide him,
unofficially, with our trade statistics to help them curtail “smuggling”, but asked
that they should not be made public. He wanted these trade figures to be
published. I explained that as our statistical classifications were different from
theirs, publication would cause more misunderstanding. Suharto was confident
he could manage the Indonesian press.
Finally he agreed to examine the long-term implications of publication
before taking this step. Next we agreed on a submarine telecommunication link
between Singapore and Jakarta, with the technical details to be worked out by
officials.
Although our meeting went well, our ambassador in Jakarta, Rahim Ishak,
warned that Indonesians, both the leaders and the people, viewed Singapore as
Chinese. He said Indonesian attitudes to Singapore were inextricably tied up
with their feelings towards their Indonesian ethnic Chinese. Singapore, he
warned, would be a convenient whipping boy whenever there was discontent in
Indonesia. This proved to be prophetic when Indonesia went into crisis in 1998–
99.
It was our good fortune that the character, temperament and objectives of
President Suharto allowed me to develop good personal relations with him. He is
a quiet man, courteous and punctilious on form and protocol. His character is in
keeping with the way he carefully probed and assessed my position before my
visit to Jakarta. After our second meeting, we had confidence in each other. As
we met over the years, I found him to be a man of his word. He made few
promises, but delivered whatever he had promised. His forte was his
consistency. He is three years older than me, broad-faced, broad-nosed, with a
somewhat taciturn expression until he got to know one, when he would smile
frequently and easily. He enjoys his food, especially desserts, but made an effort
to control his weight through walking and golf. Although he speaks calmly and
softly, he becomes quite animated once he gets going on an important subject.
He is not an intellectual, but he had the ability to select able economists and
administrators to be his ministers. He chose Berkeley-educated economists like
Professor Dr Widjojo Nitisastro and Ali Wardhana, who opened up Indonesia to
foreign trade and investments and gradually made it one of the successful
emerging economies.

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Our friendship overcame the many prejudices between Singaporeans of
Chinese descent and Indonesians. Throughout the 1970s and ’80s we met almost
every year to keep in touch, exchange views and discuss matters that cropped up.
I would explain that language and culture were difficult emotional issues I had to
handle sensitively. English was our common language, but the “Speak
Mandarin” campaign was necessary because Chinese in Singapore spoke more
than seven different dialects. Similarly, Singaporeans of Malayan and
Indonesian origin had given up Javanese, Boyanese and Sundanese and were
using only Malay. As for cheering for the Chinese badminton team against
Indonesia, it was the stupidity of vociferous pro-China groups who had even
booed their own Singapore ping-pong players when they played against players
from China, the world champions. He accepted my view that over the long term
the Chinese in Singapore would become Singaporean in outlook.
Suharto wanted to develop Batam, an island 20 kilometres south of
Singapore and two-thirds its size, into a second Singapore. He proposed in 1976
that I help Indonesia to develop Batam. The infrastructure was inadequate and it
had only a small population of fishermen. He sent his newly appointed adviser
on technology, Dr B.J. Habibie, to see me. Habibie’s mission was to develop
Batam. I encouraged him to use Singapore as the dynamo, but explained that
Batam needed the infrastructure of roads, water, power and telecommunications,
and the removal of administrative bottlenecks. If Habibie could get the
Indonesian economic and trade ministers to finance this project, I promised to
make the passage of goods and people between Batam and Singapore free of red
tape so Batam could plug itself into Singapore’s economic power grid.
It took some years for the Indonesian press to recognise that investments in
Batam had to be made by businessmen who would assess for themselves what
was feasible and profitable. In Indonesia all major projects were the result of
government investments, whether steel mills, petrochemicals or cement plants. I
had to explain repeatedly that the Singapore government could facilitate the
movement of capital, material and personnel between Singapore and Batam, and
could encourage but not direct our entrepreneurs to invest.
I tried to persuade Suharto to allow 100 per cent foreign equity ownership of
investments in Batam when their products were entirely for export. When we
met in October 1989, Suharto said he would allow firms producing entirely for
export to have 100 per cent foreign equity ownership for the initial five years,

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but after that they would have to divest a part of it to Indonesians. It was not as
attractive as what Singapore offered but enough to draw some factories in
Singapore that were feeling the pressure of our higher costs to move to Batam.
One of our government-linked companies, Singapore Technologies Industrial
Corporation, formed a joint venture with an Indonesian group to develop a 500-
hectare industrial park in Batam and actively promoted it among MNCs as well
as our own industrialists. It turned out a success. By November 1999 the park
had generated US$1.5 billion of investments, employing over 74,000
Indonesians. It had continued growing in spite of the financial crisis that struck
Indonesia in 1997. This led to cooperation on the neighbouring islands of Bintan
and Karimun. Then Suharto proposed we channel our seven million annual
tourists into Indonesia. Tourism cooperation spread throughout Indonesia with
our airlines getting the right to fly to tourist destinations which we jointly
developed.
As with most things, there was a negative side. Many of our Indonesian