(2 of 2)
After the Dutch departure, the riches were left largely untouched while Sukarno pursued what he called "mental investments"big prestige projects that he built by borrowing or just by having his central bank crank out billions of new rupiahs. Djakarta is a monstrous monument to Sukarno's excesses. The opulent Hotel Indonesia, where a full-sized orchestra sometimes plays to a handful of guests, stands like an ocean liner moored in a cesspool. Thousands of gawking Indonesians stream through the Sarinah department store (named for Sukarno's childhood nurse) to view goods that they cannot afford, including chewing gum at 700 a pack and Ronson lighters at $20. Amid the shacks and open kali-kali (canals), in which the impoverished populace both bathes and relieves itself, stand the rusty skeletons of unfinished skyscrapers and the crumbling concrete shells of uncompleted conference hallssymbols of Sukarno's megalomaniacal dream of turning the city into the capital of the underdeveloped world.
All Sukarno actually accomplished was to bring his once rich land to the edge of ruin and total bankruptcy. His print-now, pay-never policies caused the postwar world's worst inflation, which has sent the Indonesian cost of living up an incredible 80,000% in the past six years. More than 40% of the national airline's planes are unflyable for lack of spare parts. The country owes $2.3 billion in foreign debts, has no financial reserves and next to no credit. Its exports have plummeted, its industries are operSiting far below capacity, and unemployment is massive among its 107 million people.
Bright & Young. Can Indonesia be saved? Suharto believes that, with Sukarno gone, it can. His economic advisersmostly bright, young, Western-educated menhave already taken such emergency steps as halting all "show building" construction, balancing the 1967 budget to try to rein in inflation, tightening credit and arranging for a stretched-out schedule for the repayment of foreign debts. But Indonesia badly needs outside technical aid and foreign investments to turn its potential riches into reality. Many foreign firms, including several American ones, are already negotiating with Suharto to come in (TIME, Jan. 27). Many more can now be expected to follow. To encourage them, Suharto's men have introduced a new tax-exemption law for foreign enterprises, and are beginning to return companies seized during Sukarno's days to their rightful owners.