Indonesia's mud disaster poses political headache

Indonesia's mud disaster poses political headache
Fri May 29, 2009 4:47am EDT

By Olivia Rondonuwu and Heri Retnowati

JAKARTA/PORONG, Indonesia, May 29 (Reuters) - For Indonesia's President Susilo Bambang Yudhoyono, who is seeking re-election in July, the Sidoarjo mud disaster is a huge blot on his government because of disputes over compensation and accountability.

The disaster highlights the conflicts of interest that arise in Southeast Asia's biggest economy from mixing business and politics, as well as the country's poor track record in dealing with environmental issues.

Three years ago, a hot mud volcano erupted in Porong, East Java, destroying homes, factories, and livelihoods. Attempts to staunch the flow failed and the stinking mud continues to spread. It now covers about 800 hectares (1,977 acres), has displaced nearly 60,000 people and killed 17.

It has also proved a political headache for President Yudhoyono because of the involvement of a firm indirectly controlled by one his ministers and the government's failure to ensure those affected receive full compensation.

"It's one of the president's foremost shortcomings, the handling of the mud extrusion, and he suffers from the adverse publicity over the spread of the mud, the failure to compensate victims, and the lack of accountability," said Kevin O'Rourke, a political risk analyst in Jakarta.

Some scientists, as well as the police in East Java, have said that the mud volcano was caused by PT Lapindo Brantas when it drilled for gas in the area.

But Lapindo, which is indirectly controlled by the family of Aburizal Bakrie, a powerful politician and cabinet minister, has denied responsibility, saying the mud disaster was triggered by a huge earthquake in central Java in 2006.

"Leaders can't do business, can't mix business with governing," said Arbi Sanit, a political expert from University of Indonesia.

BAD PUBLICITY

While the mud disaster has meant bad publicity for Yudhoyono, and particularly for Bakrie, analysts do not expect this to hurt his re-election chances. That is partly because Yudhoyono can now afford to distance himself from Bakrie, while his economic management, reforms and fight against graft have won him support.

When Yudhoyono ran for election in 2004, his tiny Democrat Party formed a coalition with the much bigger Golkar Party, a Suharto-era political machine that relied heavily for funding on wealthy tycoons such as Bakrie. In return for Golkar's support, Bakrie and other Golkar politicians got cabinet posts.

But in parliamentary elections in April, the Democrats won a fifth of the votes, increasing their seats and beating Golkar.

Yudhoyono -- who is well ahead of his two rivals, former President Megawati Sukarnoputri and Vice President Jusuf Kalla -- in the opinion polls, has now formed a coalition with several small Islamic parties and Golkar has decided to field its own candidate against Yudhoyono in the presidential election in July. [ID:nIDPRESPOL]

The question is whether Yudhoyono will choose to take a harder line on the mud disaster in his second term. During his parliamentary election campaign, he said he wanted to resolve the issue, but that could depend on whether he invites Golkar, and Bakrie, to join his coalition after the presidential election.

Even opposition politicians have little appetite for pressing the government on the case.

"This is a thorn for any politician in this country, either for those in power or for those in opposition," said Daniel Sparingga, a political expert at Surabaya's Airlangga University.

"People are frustrated, disappointed and angry, but they don't have a choice and must accept whatever measures are taken by the government." ($1=10340 Rupiah) (Writing by Olivia Rondonuwu and Sara Webb; Editing by Alex Richardson)



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