The Indonesian Economy in the Early Independence Period

7 The Indonesian Economy in the Early Independence Period J. THOMAS LINDBLAD The cataclysmic conclusion of the Sukarno era in the midst of severe economic crisis in the mid-1960s cast a long and dark shadow over the early independence period in Indonesia. The newly-born nation became known as the “perpetual under- achiever” among developing countries, desperately poor with few prospects of growth due to an increasingly hostile attitude towards foreign investment, in partic- ular Dutch companies that had stayed on after the transfer of sovereignty. This dismal image dominated the historiography throughout the Soeharto regime, not accidentally labelled the “New Order”, and effectively discouraged scholars from scrutinising actual economic developments in greater detail. The fall of the New Order government in 1998, however, ushered in a period of renewed attention for the Indonesian experience of substantiating independence during the 1950s in all walks of public life—economics, social relations and politics. This special issue of Itinerario is devoted to a reappraisal of the economic development during the decades immediately following independence. What preceded the downward trend culminating in the economic crisis of the mid-1960s? To what extent were challenges and achievements conditioned by the special circumstances of decolonisation and sudden assertion as a sovereign nation? The four articles presented here complement one another. Two contributions are primarily concerned with economic policy whereas the other two adopt a wider macroeconomic perspective. Thee Kian Wie offers an account of the lively discourse among economic policy-makers in the 1950s focusing on writings by key figures such as Sjafruddin Prawiranegara and Sumitro Djojohadikusumo. Anne Booth presents an assessment of actual achievements by the Indonesian government during the 1950s, especially with regard to material progress and welfare. Daan Marks addresses the question whether the 1950s and 1960s should be dismissed as “lost decades” in terms of economic development considering the dis- integrating forces at work in the national economy at the time. My own contribu- tion, finally, links macroeconomic performance in the 1950s to economic decolonisation, a process that lagged behind political decolonisation and extended over a protracted period of time. All four articles were originally presented at a conference on the theme “The Indonesian Economy in the Early Independence Period: Challenges and Achievements”, held at Leiden in the Netherlands on 15-16 Itinerario volume XXXIV, issue 1, 2010 doi: 10.1017/S0165115310000021 Downloaded from https://www.cambridge.org/core. IP address: 170.106.35.76, on 01 Oct 2021 at 17:22:50, subject to the Cambridge Core terms of use , available at https://www.cambridge.org/core/terms. https://doi.org/10.1017/S0165115310000021 8 J. THOMAS LINDBLAD October 2008. The conference was sponsored by the Netherlands Organisation for Scientific Research (N.W.O.) in cooperation with the Australian Research Council. Papers, still awaiting publication, were also presented by Freek Colombijn, Robert Cribb, Peter Post, and Bambang Purwanto. As convenor of the conference and guest editor of the current issue of Itinerario, I wish to thank all participants for their contributions. The Leiden conference of October 2008 was followed up by a conference on “Post-colonial Indonesian Identity”, held at Yogyakarta on 14-15 January 2010. Last but certainly not least, it is my pleasure and privilege to draw readers’ attention to the unique interview with Thee Kian Wie, Indonesia’s most prominent economic historian, recorded by Andreas Weber and Henk Schulte Nordholt and printed below. Downloaded from https://www.cambridge.org/core. IP address: 170.106.35.76, on 01 Oct 2021 at 17:22:50, subject to the Cambridge Core terms of use , available at https://www.cambridge.org/core/terms. https://doi.org/10.1017/S0165115310000021.

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