Chapter 5: Irish FDI In China ~ Evidence, Potential And Policy ~ Irish Investment In China. Setting New Patterns

• by: Nicholas O’Brien

Introduction
Having set out the locational advantages and disadvantages which China possesses, this chapter will explore the non-applicability of Irish FDI in China to Barry et al‘s (2003) model for developed economies, and will attempt to explain why there is such a divergence. It can be argued that there is a view which equates outward FDI with the re-location of jobs abroad. In order to address this perception, the effects of outward FDI on the home economy will be explored. Acknowledging that our sub-hypothesis holds and that the investment climate in China is different from that faced by Irish investors in developed economies, we will explore our prescriptive research question, namely the role which exists for government in supporting potential investors who wish to enter the Chinese market.

Barry’s Model
Barry et al’s (2003) model states that Irish outward FDI is disproportionately horizontal in nature and oriented towards non-traded sectors. This model is based on an analysis of Irish FDI in the traditional destinations for Irish FDI, namely the US and UK, both of which are developed economies. This research analysed Irish FDI in China, a developing economy. While accepting the limited nature of this research, it was found that 82% of FDI is in the traded sector and only 18% in the non-traded sector. It can be said, therefore, that this finding is at variance with the model for developed economies, as set out by Barry et al (2003). Secondly, in relation to the  horizontal or vertical nature of Irish FDI in China, this research identified 55% as being of a horizontal nature and 45% as being vertical. Barry et al’s model states that Irish traditional FDI in developed economies is “disproportionately horizontal in nature’. 55% could not be described as ‘disproportionately horizontal’. Accordingly, this finding also deviates from Barry et al’s model. Accepting the difficulty of measuring the true level of horizontal versus vertical FDI, as highlighted in the literature review, the figure of 55% is below the level of 70% which Moosa (2002) contends may be the general order of horizontal FDI. This points to the level of horizontal Irish FDI in China being somewhat lower than the norm and not as strong as would have been anticipated had it been in accordance with Barry et al’s model.
We can say that this research indicates that the current wave of Irish FDI in China is predominately in the traded sector and marginally horizontal in nature.
Accepting that the sample size for this research is limited, it is nevertheless an accurate reflection of current investment patterns by Irish MNEs in China.

Table 5: A comparison of Irish investment in the US and China by sectoral composition (in percentage terms)

Irish FDI in China and Barry’s Model
It is also interesting to examine whether the limited Irish investment in China diverges or conforms to the sectoral composition identified by Barry et al (2003) for developed economies. Using the categorisation of Irish investment in the US put forward by Barry et al (see table 3 in previous chapter), the following comparisons can be made (Table 5):

The percentage for food, print and chemicals is not greatly different between both categories. IT, telecoms and electronics are considerably more important in the case of China. Significant deviations can be identified in ‘other manufacturing’, financial services and construction to a lesser degree. Notably, the Irish financial service sector is absent from China. Again acknowledging the small sample size of this research, current Irish investment trends into China show a divergence from patterns identified for investment in the US.

Why then does Irish FDI deviate from Barry et al’s model and also diverge in sectoral composition from that identified in traditional destinations for Irish outward FDI? There may be several possible explanations.

Recalling that firms invest abroad because they possess ownership and internalisation advantages, Barry et al (2003) suggest that R&D and superior product differentiation through advertising are generally found to be the most important firm-specific assets associated with multinationality; but Irish MNEs do not appear to follow the standard pattern associated with multinationality. Instead, they propose that the predominant proprietary assets which Irish firms possess are in the fields of management and expertise, mainly in non-traded sectors. However, this research found that the composition of Irish MNEs investing in China is largely in the traded sector. It is possible, therefore, that because the expertise of Irish MNEs largely lies in the non-traded sector, this is inhibiting current levels of FDI in China, given the largely manufacturing and traded nature of the Chinese economy at this point in time.
Secondly, the structure of the Irish economy can be broadly defined as highvalue output with little high-volume low-value manufacturing. (This results from the relatively high cost structure of the economy, as compared with developing economies). While Barry et al point out that the Investment Development Path hypothesis is silent on the distinction between vertical and horizontal FDI, they claim that as production costs rise there is an incentive for domestic firms to engage in vertical FDI, moving labour-intensive components to countries with a locational advantage in low-cost labour. This opportunity was identified by a very limited number of Irish MNEs. While China’s low wage cost environment may facilitate some Irish investment, market opportunity remains the primary investment objective. Read more

Chapter 6: Conclusions & Bibliography ~ Irish Investment In China. Setting New Patterns

• by: Nicholas O’Brien

Introduction
Based on research undertaken on Irish outward FDI into the US and UK, both of which are developed economies, Barry et al conclude that Irish FDI is disproportionately horizontal and oriented towards non-internationally traded sectors. As China is now the largest global recipient of inward FDI, and is a developing economy, research was undertaken among all Irish MNEs which have invested in China to ascertain if current Irish FDI into China conforms to the model identified in the case of Irish FDI into the US and UK.  Accepting that the level of Irish FDI in China is at a relatively low level, the value in considering this hypothesis is that Irish FDI in China will presumably increase, given China’s pre-eminent role in inward FDI.
While there are several investment theories, Dunning’s eclectic paradigm was chosen as the optimal framework within which to conduct this research, as it facilitates simultaneous analysis of the advantages enjoyed by both the MNE and the host economy.
Desk-based research and semi-structured interviews were conducted to explore the nature of Irish FDI in China. The decision to use semi-structured interviews to obtain data on the perceptions of executives can be considered appropriate, as the executives provided rich data on the rationale underlying the investment decision and the locational advantages and disadvantages which China poses.
Executives of non-Irish MNEs which have invested in China were interviewed in addition. The inclusion of non-Irish MNEs provided an opportunity to corroborate the views of executives of Irish MNEs and provided a broader pool of expertise from which to gather perceptions on the locational advantages and disadvantages which China poses for investors. Executives from Irish MNEs which have invested in Eastern Europe were interviewed separately to gain an understanding of why the level of Irish FDI into China is relatively low.

Main Findings
Barry et al (2003) analysed the nature of Irish outward FDI and observed an increasing level of Irish outward FDI. The main destination for this FDI is developed economies, particularly the US and the UK. It is suggested that Barry et al made a significant contribution to the research into Irish outward FDI by their identification of Irish outward FDI as being disproportionately horizontal and oriented towards non-internationally traded sectors. This research builds on their model and extends the knowledge of Irish outward FDI by examining the nature and scope of Irish FDI into China, a developing economy. The value in studying FDI in China lies primarily in its status as the principal recipient of inward FDI globally. Since the introduction of the ‘opening-up’ policy in 1979, economic reforms in China have created an increasingly favourable climate for inward FDI. However, considerable challenges still remain with inadequate legal protection and challenges to intellectual property rights.
But Beijing’s desire to expand the service and private sectors, combined with its willingness to allow foreign firms to compete nearly across the board, means that the China market is now becoming a real opportunity just as the purchasing power of Chinese consumers is beginning to increase. And China is likely to remain the world’s fastest growing major economy for the coming decade and beyond …Understanding how to do well in China and with Chinese resources will become a critical component in a global competitive strategy. (Lieberthal and Lieberthal, 2004: 11)

In order to deepen our understanding of the nature of Irish FDI and specifically the nature of Irish FDI in the largest global recipient of inward FDI, this research has examined the hypothesis that the nature of Irish outward FDI, as identified by Barry et al, varies in the case of China. This research has contributed to our understanding of Ireland’s investment development path by introducing a study of Irish outward FDI in a developing economy for the first time. Read more

Professional Blindness And Missing The Mark ~ Preface

• by: Coen Holtzappel

The articles contain the edited versions of the presentations discussed during the Wertheim Seminar, held on June 4, 2008 in the International Institute of Social History (IISH) in Amsterdam. The subject was Blind Spots and Preoccupation in the research on Post War Indonesian Political Crises. The seminar was part of the 3-day Wertheim Centennial. It was hosted by the International Institute of Social History (IISH), the ASIA Platform of the University of Amsterdam and the International Institute of Asian Studies (IIAS) and organized by a team from the Wertheim Foundation, i.e. Ibrahim Isa – secretary, Farida Ishaya – member, Jaap Erkelens – member, and Coen Holtzappel – chairman and convener of the Wertheim seminar. The speakers, guests and audience honored the legacy of Professor Doctor Wim Wertheim with this event, the distinguished academic who after World War II founded the Amsterdam school of the historical sociological analysis of modern Asian history and political development. Wertheim also played an important role in the Dutch and international resistance against the murderous war on Indonesian communism, which President Suharto started after the 1 October 1965 Affair, and his destruction of Indonesia’s Sukarno legacy. The seminar was opened by Emil Schwidder, research staff member of the IISH, with a special task on the China collection. He reminded the audience of the close professional relationship that Professor Wertheim and IISH maintained during his life, and the fact that Wertheim’s children donated their father’s correspondence, publications and other documents and tapes to the institute. The IISH was founded in 1935 and has become one of the leading institutes in the world to rescue, conserve and register important archives of socialist social movements. Before the Second World War, archives were rescued from Austria, Germany and Spain, including papers by Karl Marx and Friedrich Engels. War archives from Eastern Europe, Turkey, the Middle East and Asia followed. The collection of Wertheim’s personal and official correspondence, publications, personal and press photographs is now part of the archives.

Coen Holtzappel, convener of the seminar and chairman of the Wertheim Foundation, thanked Emil Schwidder for his kind opening words and welcomed the speakers, the audience, and the special guests. He called to attention the subject of the seminar, i.e. the disturbing role of political and social ignorance, taboos, neglect and denial in the study of historical events and phenomena. They should not be mistaken for “white spots” in our knowledge of the world; i.e. not yet discovered domains of research and phenomena. The real focus is on subjects and domains of knowledge that governments and political elite groups close for research, for example to hide specific aspects of their political behavior, such as crimes, irresponsible wars, blunders, and crimes against humanity. The speakers of the seminar would discuss examples of such disturbances they encountered during their studies of major political crises in and between the Republic Indonesia and the Netherlands during the first two decades of Indonesia’s existence. For many Indonesians, the Netherlands is still the former colonizer and occupier. For many Dutch people Indonesia is the former Netherlands East Indies. They call Indonesian food “Indies food.” According to Wertheim, such ‘blinkers’ have a history. In authoritarian states they are the products of carefully maintained systems of political myth formation, created by elites. To cite the closing statement of Ben White’s chapter in this book, which stems from Wertheim’s Elite and Mass, “The blind and the ignorant, in general, are not busy making themselves or others blind and ignorant. What Wertheim drew our attention to, in contrast, was a process by which elites, and scholars, choose to describe societies and history in ways which made both themselves and others blind to social reality.” In other words, the sources of blindness and ignorance that we should pay attention to, are the elite groups and scholars that use their power and influence to make people look at the things they want them to see and refrain them from looking at things they want them to ignore or deny.

Although I am convinced that such tyrants also exist in people’s personal life, bringing others to crime and suicide, in social and political history we are primarily interested in the political and public social level at which political tyranny occurs. The level where political and religious leaders program people to follow their prejudice and abstain them from using their innate human capacities to study the unknown. In this respect the chapters presented in this book reflect an effort to tackle the problem of how to approach the prejudices in the Dutch-Indonesian discourse about the history of the first decades of Independence War and subsequent decolonization. Instead of the dislikes that burden Dutch and Indonesian views of each other, we should work on a value free and neutral historiography of the shared process of separating Indonesian and Dutch households and interests, and the development of their own ways of continuance. Central in this effort should be the urgent advice to historians, social and political academics to base restudies of past crises and events on the primary sources and eye witness reports. It is the only way to stay as close to the past as possible.

The subjects covered by the seminar are as follows:
[1] The ignorance in Dutch and Indonesian literature regarding the role of the Republican Pemuda units as protectors of Indo-Europeans after the Japanese capitulation. The findings of Mary van Delden appear to challenge conceptions that still exist on both the Indonesian and the Dutch side,
[2] Coen Holtzappel calls attention to General Nasution’s analysis of the roots of the Madiun Affair of 1948 as exposed in Part 8 of his 10 volume Publication on the Indonesian Independence War. Instead of delivering a tale about how he crushed the communist Madiun coup, Nasution went back to his notes, and the available Indonesian and Dutch sources. He produced a study of the registered and unregistered events that caused the Indonesian military Madiun uprising of 1948 and the communist support of it.
[3] Pieter Drooglever emphasizes the ignorance regarding the roots and meaning of Papua nationalism during and after the conflict about the international status of Netherlands New Guinea between the Netherlands and Indonesia.
[4] Holtzappel uses the minutes of the first two martial law trials against two leaders of the Thirtieth September Movement of 1965 to show that Western and Indonesian analysts ignore the conflict that ignited the movement. Their focus is too much on the view of “winner” General Suharto and ignores the view of the “losers” which reveals a different story.
[5] Saskia Wieringa turns our attention to the ignorance and denial after the Reformasi of 1999 of the use of sexual slander against the communist women’s organization Gerwani by General Suharto. Sexual slander was used to stigmatize communism, and communist women in particular; and to legitimize genocide in order to destroy President Sukarno’s political and social legacy. Apparently, Reformasi has not created the clean break with the Suharto past many had hoped for in 1999. There still is no room for reconciliation and truth finding, unlike other countries with a communist past and a dirty war against it.
[6] Ben White points to the conservative roots of a renowned American anthropologist’s unwillingness to analyze the massacre, which fitted existing standards of scientific knowledge and morality. Referring to outsiders in order to explain the massacre as having cultural roots shows elitist escapism. It asks the question but leaves the answer to the anonymous and politically disabled victims and the perpetrators. Read more

Professional Blindness And Missing The Mark ~ Internees From The Republic

• by: Mary van Delden

Introduction
‘Blind spots and preoccupation’ is the leading theme of our seminar of today. As a basic phenomenon in historiography, it is applicable to nearly every subject, but it springs to the eye more so when one touches upon controversial matters. As such, I want to discuss in the present paper[1] the matter of the internment camps for Europeans, mainly Eurasians, installed by the Indonesian Republic during the Bersiap period in the early years of its existence. I will narrow down two closely interrelated questions. My first question is if the Republican leadership intended these camps to intimidate the Eurasians and keep them as hostages in the oncoming struggle with the Dutch, or whether they were meant to protect them from insurgencies by rebelling youths. The second question is, how and by who have these questions already been addressed and, if there are any marked differences, how come?

I will start with a short survey of events that led to the setup of these camps in the second half of 1945. The proclamation of a new state calling itself the Republic of Indonesia – broadcast on August 17, 1945 by Sukarno and Hatta – took the Dutch by surprise. They had been the dominant power in the archipelago for more than three hundred years – and wanted to continue what they considered ‘their task’ in the Indies. However, that would prove to be no easy task. In 1941/42, they had participated in the war against Japan with the United States, the United Kingdom and Australia, and had made a worthwhile contribution. After the initial Allied defeats, the other Allies had managed to regain strength in order to continue the war, and bring it to a happy end. The Netherlands, however, was no longer in a position to contribute to a considerable degree. After the German invasion of the mother country in Europe in 1940 and the Japanese occupation of the Netherlands East Indies in 1942, they lacked the means to do so. After the German defeat on 5 May 1945, they had to rebuild military power from scratch. At that time they were very much the junior partner in a war that was running to its end in Asia as well. For the Dutch, the proclamation of the new Indonesian Republic would prove to be a serious threat.

In Potsdam (15-17 July 1945), with the defeat of Japan in sight, the Allies agreed that the responsibility for taking over all Southeast Asia, excepting the Philippines, should be entrusted to Lord Louis Mountbatten’s South East Asia Command (SEAC).[ii] He therefore had to accept the Japanese surrender, rehabilitate the Allied Prisoners of War and Internees (APWI) and restore law and order in Indo-China, Siam, Malaya, Burma and the Netherlands East Indies. As far as the Dutch were concerned, the limited forces available to them operated within the SEAC organization. Meanwhile, Dutch civilians balanced on the edge of starvation in concentration camps, and Prisoners of War (POW) of the Royal Netherlands Indies Army (KNIL) were awaiting evacuation in camps outside the island of Java. Inside the Indonesian archipelago, about 180,000 Eurasians (Dutch nationals of mixed race) were living together with the Indonesians in appalling conditions in impoverished cities and in the countryside. Most Eurasian families had not been interned, as a consequence of the Japanese policy on Java, which considered them to be a distinct group of people. Being the offspring of Asians and Europeans, they were to co-operate with the administration set up by the Japanese 16^th army and would be treated like the indigenous inhabitants.[iii] However, this policy failed. The Eurasians were proud of their Dutch nationality and resented being placed at the same level as the native population. The Indonesians themselves had no sympathetic feelings towards the Eurasians, who they felt had been sheltered under the colonial umbrella. At the same time, nationalist and anti-Western feelings increasingly found their way to the surface, incited by the Japanese. These contradictions were the uncertain position of the Eurasians at the time the Indonesian revolution started.

Since Mountbatten was initially unaware of the real situation in the Indies and preferred to deploy his troops elsewhere, it was more than a month after the Japanese capitulation before the first British-Indian troops were ordered to move from occupation duties in Malaya to Java. This delay resulted in a power vacuum and an atmosphere of tremendous enthusiasm among the Indonesian youth. Many ‘pemuda’ joined the newly organized People’s Security Organization (Badan Keamanan Rakjat – BKR) or established numerous irregular bands grouped around older nationalists, religious teachers (kiyai) or gangsters (jago). Anxious to contribute to ‘merdeka’ (freedom) these youngsters raised red and white flags everywhere, organized mass-meetings and demonstrations, and began to look for arms to defend their ‘merdeka’ against the returning colonial power. Until then the atmosphere had been rather quiet, but by the end of September 1945, the situation rapidly deteriorated. Chaos, anarchy, lawlessness and violence predominated.

Initially the Netherlands-Indies authorities regarded the resistance as the aftermath of the Japanese occupation and the militant youngsters as hooligans. However, they soon found out this was a severe underestimation of the situation. During the occupation, most of these militant youngsters had received Japanese military training, which had emphasized fighting spirit and physical endurance. Such courses had been given to trainees in the Volunteer Homeland Defense Army, the police and the navy. Crucial for the developments afterwards was the fact that these courses were given in the districts and sub districts, resulting in revolutionary outbursts simultaneously starting all over Java. [iv]
The Allied command watched the revolutionary uprising with concern. The last thing it wanted was to get involved in a colonial war. Mountbatten decided to alter his policy drastically. Instead of re-occupying the whole of the Netherlands East Indies, he switched to a key-area strategy. For Java, this initially meant the re-occupation of two major coastal cities: the capital Batavia (Jakarta) and the marine-base Surabaya. On second thought, the re-occupation was extended to Semarang and Bandung, where many APWI were concentrated. Besides, Mountbatten was determined to persuade the Dutch to negotiate with the Indonesians in order to reach an agreement. Read more

Professional Blindness And Missing The Mark ~ The Year 1948 And The Madiun Affairs – A Year Of Cheat And Rumors

• by: Coen Holtzappel

“The Reorganisation-Rationalization (Re-Ra) was the detonator of the explosion that struck the TNI and Indonesia and was abused by the Dutch and the PKI for their own aims” (Nasution II a: 5).

The year 1948 and the Madiun Affair were of decisive importance for both the existence of the young Republic of Indonesia, and the military career of Lieutenant General Abdul Haris Nasution. He devoted several publications to the major events of that year, among them Book IIa of his Memoirs. I will use that book to present his view of the events, since he had a pivotal role in both their genesis as well as their aftermath. My interest in Nasution developed during my work in Indonesia, where my Chinese bookseller Liem regularly provided me with books that stemmed from libraries of former regional government officials and military who spent their retirement in Malang, East Java. Among these books were Mahmillub court martial notes and books that Nasution wrote during and about his military career, and the events he encountered. Back in the Netherlands, I began reading Nasution’s books, as well as books about him. His history fascinated me, since he was a man who continuously had trouble with authorities and interest groups, but always managed to come back stronger than before, until his companion and opponent President Sukarno finally had to leave the political scene mid-1960s. In discussions with Wertheim, he objected to my fascination with the man, since he saw him as a liar and a cheat. In August 1993, I interviewed Nasution for a biography about him and met a charming and inspiring man who, just like Wertheim, had a photographic memory for people, events and books. Again, Wertheim condemned the effort and predicted a tremendous task in separating fact from fiction. I never had any inclination to adhere to his point of view, and started working on the biography. Gradually, and by checking Nasution’s data and insights with existing and authoritative literature on the events he participated in, I realized that he had something important to say. His memories are relevant and his insights worthwhile to report to a larger public. In this chapter, I will use his memories of the year 1948; one of Indonesia’s many Years of Living Dangerously. They are taken from Volume IIA of his Memoirs, called Memenuhi Panggilan Tugas, i.e. “Doing My Duty”. Despite Wertheim’s objections against my work on Nasution, he nevertheless remained interested in my work and supported me when and wherever feasible; for which I am grateful.

Appeasement and its political problems
In the preceding chapter we have seen that Sukarno’s policy of appeasement vis-à-vis the Allied Forces was intended to be positive for the former Eurasian prisoners of Japanese camps, and was even facilitated by pemoeda support. It served Sukarno’s goal of appeasing the Western Allies by showing his good intentions regarding victims of the Japanese occupation. However, the political history of the year 1948 shows the growing dissatisfaction within the Indonesian army, among the village militia and the political parties with the other facets of the appeasement policy. It is probably this history of dissatisfaction and mistrust, and its dramatic end in civil war and coup accusations, which has blinded subsequent Indonesian and foreign historiographers to the two sides of Sukarno’s appeasement policies. In essence Sukarno was a Jacobin, which means that he changed camp whenever it served his interests. Before the Second World War Sukarno took the non-cooperative side of Indonesian nationalism, and continued that line during the Japanese occupation when he chose to side with Japan. After the Independence Declaration of 17 August 1945 he chose, for tactical reasons, to co-operate with the Allied Forces, whose support he needed in the Independence war against the Dutch. After the Republic and the Netherlands parted ways for good in 1956 after fruitless negotiations about the division of mutual interests in the archipelago and repayment of war damage caused by Indonesian military, Sukarno used the Western Allies once again in a campaign aimed at making the Netherlands stick to its 1949 promise of handing over New Guinea to the Republic of Indonesia. Without any clear reasons from the Dutch for doing so, that issue had been excluded from the Round Table Agreement. From 1964 on, and forced by Indonesia’s miserable international financial debt, Sukarno relied heavily on support from Communist China. After October 1965, appeasement was not as important, and was replaced by Suharto’s balancing act of looking inward and outward.

An independent analysis of the 1948 affairs
For an interesting Indonesian analysis of the 1948 events, I will use Part 8 of Nasutions 10 volume Publication on the Indonesian Independence War. The analysis is based on Nasution’s personal memories and notes about his stay in Yogyakarta in 1948. At that time he was chief of staff of Commander in Chief General Sudirman and worked with him on an encompassing strategy plan that served two goals. On the one hand, a proper solution was needed for the relentless Dutch effort to destroy the Indonesian army after its infamous defeat against the first Dutch Aggression of July and August 1947. On the other hand, they were in search of a way to covertly rebuild a new and combat ready Indonesian army that would be able to conduct mobile strike operations at the regional and national level, and guerilla war at the local level. Nasution’s analysis of the Madiun Affairs regard this effort and its complicated political context.

Nasution’s memoirs were first published in 1983 by CV Haji Masagung in Jakarta. I use the second, 1989 edition in which the original Volume II has been split up in two separate volumes, i.e. Volume II a, and Volume II b. Volume II provides Nasution’s analysis of the preparations for guerrilla warfare against the expected second Dutch aggression. Chapter 2 contains the PKI Insurrection. It is a mixture of ideas, notes, and other materials from 1948, as well as personal memories, and as such it is still relevant to revisiting the 1948 crisis. Nasution sharply separates his military analysis of the 1948 events from his conclusions, in which he ventilates his anti-communist sentiments. Where necessary, I will augment his analysis with facts, documents and analyses from McTurnan Kahin’s thesis on Nationalism and Revolution in Indonesia. This thesis is based on Kahin’s experiences as journalist and member of the Indonesian Ministry of Information during Independence War. Although his exposition has some odd misses regarding the dates and order of events, it makes some interesting points. It focuses on the political side of the 1948 events, in particular the emergence of a strong leftist protest against President Sukarno’s “sloppy” way of negotiating about peace and independence with the Dutch from February 1948 on. But it also builds on Siliwangi Intelligence which dominated the marshes of rumors circulating in and around the Ministry of Information in 1948. Solely for that reason, and despite the fact that so many years after the event it is a difficult to check these sources, as a contemporary of Nasution Kahin’s study is helpful for a historical analysis of 1948 with two starting points: the objectifying analysis of Nasution and the left leaning analysis of Kahin based on Siliwangi dominated information. Since this piquant confrontation deserves a much larger and broader analysis than this chapter permits, I will primarily use Kahin’s English translations of Indonesian speeches and proclamations. Read more

Professional Blindness And Missing The Mark ~ Papuan Nationalism. Another Blind Spot

• by: Pieter Drooglever

Stimulated by the closing lectures of professor Wertheim, we are in search of signs of ignorance in and on the Indonesian past this morning. Put in other words, we are looking for blind spots in the history of Indonesia during the first decades of its existence as an independent state. In historiography, it is a well-trodden path, which leads us from 19^th century positivism to the peregrinations of post modernism and after.
In their daily practice, historians and social scientists have never fully embraced either one of these philosophies. After all, the first approach would have led us to make ever-expanding lists of facts without offering understanding, the other towards an empty space crowded with ghosts we are unable to define. More often than not, historians have looked for what is relevant for their understanding of past and present, aware of the fact that both things are interrelated. As far as I understand, it is in this spirit that Wim Wertheim presented his farewell lectures here in Amsterdam, and it is in that same spirit that we have to look for blind spots today.

Nationalism in the making
In their contributions, Mary van Delden and Coen Holtzappel have already discussed some of the events of the 1940s. Their focus was on the dispute between the different groups in the centre of the young Indonesian Republic about how to organize their state and wage their struggle for independence. In the afternoon, our attention will shift to the mid-sixties, and mainly to the same kind of questions. To bridge the gap in time and subject, I have decided to focus on the New Guinea dispute. It enables us to shift our attention to the fifties and early sixties, to international affairs and, above all, to the way both parties handled the crucial matter of Papuan nationalism. I will say something about its origins, the way it popped up in the fifties and survived on the stage of history until the present day. Moreover it will give us a fine opportunity to test how the phenomenon of the blind spot works in policymaking and the process of history writing.

Nationalism, then, can be summarized as the political expression of a sense of collective identity. A special brand of it developed in the early twentieth century in the more progressively administered European colonies in Asia. Its development is aptly described by Dutch civil servant Jan van Baal in his small but penetrating booklet, Mensen in Verandering (Van Baal 1967, pp. 90-99). In such colonies, and he meant the Netherlands Indies, modern rule and economic exploitation demanded the creation of effective administrative structures and the accompanying paraphernalia of education, infrastructural works and means of transport. To man the colonial state, promising young men from the native elites received professional training and were put to work in various parts of the vast colonial domains. In doing so they transgressed the boundaries of their previous native lands and got to know the wider colony as their own country. It also meant partial adaptation to the culture of the European colonists. The latter, however, had difficulty accepting them as equals in the colonial enterprise. This confrontation led to the development of a new sense of identity, leading to the sprouting of nationalist movements everywhere. In Indonesia these found their focal point in the Youth Conference of 1928. Here, the new nation was provided with the symbols of a national oath, a flag, a national anthem and the acceptance of a common language. They were the symbols of the new nation on the road to independence in the second half of the forties.

That nationalism, however, did not spread equally over the whole of the archipelago. Its creation had mainly been the work of the Javanese-Minangkabau elites that had delivered the cadres for the colonial state. The people from the Moluccas had played a rather important role in this process as well. However, many local and ethnic groups only followed at a distance, especially in the eastern part of the archipelago. Of these groups, the Papuans had been left out nearly completely. They lived in some of the least developed areas and had hardly participated in the forming of the colonial state. Until well into the 20^th century the Papuans had no sense of having a common identity of their own. In this region, modern colonial development and the accompanying processes of acculturation had started late, and as a consequence the Papuans had missed the nationalist boat. None of them were present at the 1928 youth conference and everything that went with it. Even so, it is questionable they would have participated anyway, given the cultural distance between them and the rest of Indonesia.
In 1945 as well, when Indonesia’s independence was declared, no Papuans were present. That is not to say that they were ignored without a word. Their future was rather extensively discussed in the meeting of the preparatory committee for Indonesian independence on July 11th 1945. Prominent nationalists discussed the territorial extent of their new state. Most prominent among them were Hatta and Yamin. The latter pleaded for the greatest possible territory, including the surrounding British possessions on Malaya and Kalimantan. In his opinion, Papua belonged to the Indonesian lands as well. Although the population differed from that of the rest of Indonesia, the Indonesians had dwelt there since immemorial times, which was sufficient to defend its inclusion in the new state. Moreover, the internment camps in Boven Digul had strengthened these ties in recent times. In this respect Yamin was warmly supported by Sukarno, who added that anybody who cared to cast a glance at the map of the archipelago, could see it lying there. So obviously, it was the will of God that New Guinea be a part of the new Indonesia.
One of the other speakers, the Sumatran economist Mohammad Hatta, took an opposite view and warned his audience against all too imperialistic propositions. Partly he did so for financial and organizational reasons. For the first decades to come, Indonesia would not have the means at its disposal to develop the backward lands of the Papuans. But he had a moral argument too, adding he was not convinced by Yamins arguments in support of uniting the population with the rest of Indonesia. In the end, it was left to the Papuans themselves to decide what kind of state they would prefer. It was an argument in favor of the right of self-determination, but Hatta did not find much support among his audience. When it came to voting, only 6 of the 66 members of the committee opted for his proposal to leave out West New Guinea. They obviously accepted another thesis of Yamin, that if the Papuans were no Indonesians yet, they could be made to become so. Thus, the preferences for a greater Indonesia were laid down for the future. Read more