BUSINESSWEEK ONLINE: JULY 3, 2000 ISSUE|
Marzuki Darusman (int'l edition)
Now he is getting his chance to bridge the gap--and risking his life to do it. Appointed Attorney General last November, Darusman, 55, is prosecuting cases that symbolize the inequities of Indonesian society. Corruption, mass murder, and human rights abuses during the three-decade rule of former President Suharto are all on the agenda. Indonesia is now trying to hold accountable a privileged class that exploited the vulnerable. ''This is a push to create a situation where there is at least a sense of decency and rightness,'' Darusman says.
His caseload is a wide-ranging corruption investigation of Suharto, his family, and his cronies. The case had been closed in mid-1999 by Darusman's predecessor under pressure from army generals loyal to Suharto. After their leader, General Wiranto, was taken off active duty by President Abdurrahman Wahid soon after his election, Darusman reopened the case. Then he took the unprecedented step of placing Suharto under ''city arrest'' and putting his closest business associate, Mohamad ''Bob'' Hasan, behind bars to keep him from tampering with evidence. Prosecutors are studying the records of several ''charitable foundations'' that were chaired by Suharto and run by Hasan.
Darusman also is prosecuting Wiranto, the former armed forces commander, for crimes against humanity in East Timor. The Wiranto case is based on eyewitness reports that his troops carried out a scorched-earth and mass-murder campaign in the former Portuguese territory last September. The case gave President Wahid the ammunition to boot Wiranto from his powerful cabinet post. It also paved the way for Darusman to convict several Wiranto subordinates for human rights violations in the gas-rich province of Aceh.
Still, Darusman is reluctant to go too far. ''We'll have to stop at the point where the public feels that we've settled the scores of the past and not go beyond the point where it would start a witch-hunt,'' he says. Darusman says he'll throw the book at Suharto and leave clemency ''in the domain of politics.'' Indeed, Wahid has said he would pardon Suharto if the former President is convicted of corruption--and if he turns over $25 billion of his alleged fortune to the state.
INSIDE TRACK. Flanked constantly by bodyguards, Darusman is the third-most-heavily guarded Indonesian government official, after Wahid and Vice-President Megawati Sukarnoputri. Every day, Darusman's security men change his schedule to confuse would-be assassins. But he's not about to back down. He sees his current job as the challenge he has been preparing for since he went into politics in the 1970s. Convinced that the only way to make a difference is from within the system, Darusman spent 15 years as a member of Parliament for the ruling Golkar party, representing Bandung, West Java, where he graduated from law school. Then he served on the National Human Rights Commission for seven years, investigating complaints against the army of kidnapping, mass murder, and gang rape.
A driving ambition also plays a major part in his character. In 1992, he told an Indonesian magazine that ''any self-respecting politician would want to become President.'' In Suharto's Indonesia, such a phrase was tantamount to submitting one's candidacy. Golkar immediately struck his name from the list of the party's candidates in the 1992 election. Today, Darusman insists that he does ''not really'' covet the presidency.
He proved his leadership qualities months before he became Attorney General. When Golkar was torn apart last year by a rift between Suharto loyalists and reformists, Darusman led an internal coup and put himself in charge of a pivotal committee to remake the party. He helped galvanize support for Wahid, a tolerant Islamic cleric from outside the party, as a presidential candidate. ''I'm not fighting against the system. I'm trying to modify it,'' he says. So far, Darusman has what it takes to do that.
Lee Moo Young (int'l edition)
Lee started with a game plan aimed at ending mistrust, corruption, inefficiency, torture, and other abuses associated with South Korea's 95,000-strong police force. In December, he launched a 100-day reform campaign targeting rank-and-file officers. He gave them 221 goals, from streamlining red tape to stamping out teenage prostitution in a Seoul red-light district known as Miari Texas. The agenda was loaded with sweeteners to boost morale: shorter work hours, expunging of past records, and an electronic reporting system to slash workloads.
Happier officers do their jobs better, and arrests of violent criminals are up 10%, while the overall crime rate has dropped 13.5%. ''Corruption arises from poor working conditions,'' says Lee, a lifelong officer who rose through the ranks vowing to rid the police force of its authoritarian image.
Lee also has done much to ease tense relations with the public. Surveys show that more than three-quarters of South Koreans believe officers are friendlier now. And demonstrations are noticeably less violent after Lee banned the use of tear gas against protesters--a big change since police fired 130,000 canisters during 1997, the most violent recent year of demonstrations. Lee also makes greater use of policewomen, figuring angry protesters will be less inclined to strike them. The strategy worked. ''One female officer on the front line is equivalent to 10 male officers in riot gear,'' says Lee. Lee aims to raise the number of women recruits tenfold this year, to more than 600, and plans to raise women's share of the force to 4% by 2003. Lee, who with his wife hikes mountain trails several mornings a week, says he disagrees with the widely held Confucian belief in Korea that the presence of women weakens a group. Lee admits it will take time to change all the ''old habits and bad customs that have been building for 55 years.'' But he's sure walking the right beat.
Cacuk Sudarijanto (int'l edition)
But the tables have turned in Indonesia. Sudarijanto now heads the agency charged with selling the seized, ill-gotten assets the Suharto family accumulated during those years of blind obedience. Since his appointment as chairman of the Indonesian Bank Restructuring Agency (IBRA) in January, Sudarijanto has managed to engineer quick changes in what had been a moribund institution unable to carry out its mandate. In short order, he sacked some deputies who were seen to be soft on cronies and he broke two political logjams to allow the sale of Indonesia's largest auto assembler, Astra, and its largest private bank, Bank Central Asia. ''The bottom line is that no one is indispensable,'' says Sudarijanto, now the one commanding obedience. ''This is for the benefit of Indonesia.''
How well Sudarijanto does at IBRA is vital to Indonesia's economic recovery. The International Monetary Fund has linked further aid to Jakarta to its ability to raise funds for the national budget through IBRA's sales of seized assets. IBRA plans to raise $2.5 billion this year and clean up 61 nationalized banks.
After his telecom career was cut short, Sudarijanto spent the next eight years consulting and becoming active in the pribumi, or indigenous Muslim, business community--where he became friendly with now-President Abdurrahman Wahid. He joined the world of banking as an executive at Bank Mega, one of the few Indonesian banks to come out of the financial crisis. Three months after Wahid's election, Sudarijanto was tapped to revive IBRA. Sudarijanto remains so close to Wahid that his meetings with visitors are occasionally interrupted by telephone calls from the President.
Colleagues of the Indonesian-educated engineer are in awe of the ease with which Sudarijanto keeps his wits about him in the midst of chaos. Sudarijanto says it comes easy to him: He got used to it in the 1970s at IBM Indonesia, where he rose through the ranks and dealt with the daily disorganization typical of Third World countries. Part of his responsibility included the daunting job of paring down expatriate staff. ''I'm a man of crisis,'' says Sudarijanto. So with Indonesia recovering from one, this man is right where he belongs.
Chen Shui-bian (int'l edition)
But while Mao was a revolutionary who ushered in an era of chaos, Chen is a former top-notch trial lawyer who approaches his new job with the careful deliberation of an attorney preparing for the most important case of his career. Certainly, taking over Taiwan's presidency at a delicate period in relations with the mainland is one of the most important tests any politician has ever faced. Because Beijing views Chen, 49, as a dangerous pro-independence radical, his biggest and most immediate challenge has been relations with China. Chen's inaugural speech masterfully struck a balance between mollifying Beijing and asserting Taiwan's own interests. As he goes along, walking that fine line will demand all the diplomacy he can muster.
But Taiwan's voters didn't elect Chen for his stance on China as much as for his promise to clean up corruption. Known as ''black gold,'' Taiwan's tangled web of corruption involves gangsters, politicians, and local businesses and grew sinuous and strong under KMT rule. The straight-shooting Chen, a guiding member of the Democratic Progressive Party, proved his mettle fighting black gold as mayor of Taipei: He increased government efficiency, cracked down on graft, and shut down the vice dens.
No one shows better than Chen how raw, spirited talent can rise to the top in Taiwan. Born to a tenant-farming family, he was so sickly as a newborn that his parents didn't even register his birth until several months later, when it was clear that he had a good chance at survival. They had to borrow money to pay for his school, but the investment paid off. A star student, he consistently graduated at the top of his class. He ranked first among all the students admitted to the most prestigious university program in the country, the law department at National Taiwan University. During his junior year, he took the bar exam and scored the highest grade in the country--becoming Taiwan's youngest lawyer.
In 1979, Chen defended a group of opposition figures after a violent demonstration in Kaohsiung. Among those in the dock under the martial law regime was Annette Lu, now Chen's vice-president. The trial galvanized Chen's political instincts. In 1981, he won a seat on Taipei's City Council, marking him as an up-and-comer in the opposition.
Chen painfully learned what a dubious distinction that was. In November, 1985, an assassination attempt on his wife left her permanently paralyzed. The following June, Chen began serving an eight-month sentence for politically motivated libel charges. But jail didn't dull his instincts, and he rose up the political ladder. Defeated in 1998 when he ran for mayoral reelection, he redoubled his efforts, which paid off with his March victory. Chen has a tough agenda. But he knows the issues and has proven himself one of Taiwan's best and brightest.
Andrew Sheng (int'l edition)
He immediately set out to revamp Hong Kong's crazy quilt of securities laws and as chairman of a government task force, has led a crusade to bring the laws up to international best practices. The two-year effort now awaits approval by Hong Kong's Legislative Council, which is scheduled to take up the bill later this year.
In Hong Kong, where stock market scamsters generally are let off with the mildest of slaps on the wrist, the new law will make insider trading a criminal act rather than merely a civil violation. Just as important, the omnibus Securities & Futures Bill marks a philosophical shift toward more disclosure and greater transparency. ''Good, reliable, and timely information is a market fundamental,'' preaches the 53-year-old Sheng.
Sheng hasn't been standing still while the legislation is pending. Since taking office, he has introduced a slew of new disclosure rules for listed companies governing everything from connections to a business group to outlining for shareholders possible liabilities associated with investments in joint ventures. He's spearheaded the push toward a more U.S.-style disclosure-based system for the city's second bourse, the Growth Enterprise Market (GEM), rather than simply relying on outside enforcers from the stock exchange or his own SFC.
Sheng is a believer in the ''buyer beware'' school of investing, but he's determined that investors know a lot more than they have in the past. The need for ''improved transparency is very much a lesson we drew from the Asian crisis,'' says Sheng. ''We are living in a global market world which, unfortunately, has local regulatory frameworks and practices.''
Not everybody likes Sheng's attempt to raise the bar of what's acceptable in securities and futures markets. His aggressive stance has earned brickbats from some in Hong Kong's tight-knit financial community. A senior stock exchange official accuses the SFC of taking an unduly harsh line toward GEM and ''ruling for the sake of ruling rather than [doing] what's important for Hong Kong.''
Sheng doesn't see things that way. Nor do most of the foreign investors and investment banks that are playing an increasingly important role in Hong Kong. Most of them would agree that Malaysia's loss has been Hong Kong's gain.
Gothom Arya (int'l edition)
Those experiences serve Gothom well in his current role. He is one of Thailand's five Election Commissioners, appointed under the new constitution to clean up notoriously dirty Thai politics. He knows what makes free and fair elections, and he's trying to make them happen in Thailand. ''I spent my life in education, and this job is more or less about educating,'' he says.
The most outspoken of the commissioners, Gothom is emblematic of the change that is sweeping through Thailand's electoral system. After elections in March, the commissioners barred an unprecedented 78 of 200 parliamentarians from taking office because of suspected vote-buying and then ordered new polls. When not investigating electoral abuse, Gothom now visits rural villages, preaching against the evils of vote-buying.
ONLINE ORIGINAL: A Chat with Gothom Arya
S.M. Krishna (int'l edition)
In fact, Krishna is a man in a hurry, and with a tough mission: to preserve Bangalore's standing as India's Silicon Valley. Fed up with the city's crumbling roads and chronic power and water shortages, high-tech companies weren't expanding their operations, nor were new ones eager to come to Bangalore, preferring neighboring Hyderabad. Krishna, the Congress Party's dark-horse candidate, sprang into action after being elected last October. ''I had to move on a war footing,'' says Krishna. ''There was despondency all over.''
He personally called technology company leaders, reassuring them that he would fix the problems. He repaved about 200 kilometers of Bangalore's potholed roads and pushed through funding for long-held-up projects, including the International Technology Park, in which the Singaporean government invested $5.5 million. Confidence in the real estate sector is returning.
For his rural constituents, Krishna has been instituting programs to increase crop yields. ''Agriculture is my main concern; a leader ignores it at his own peril,'' says Krishna, the scion of a land-owning farming family. He is currently negotiating a $250 million loan with the World Bank to rebuild 25,000 old water tanks and provide reliable irrigation to his arid state. He's helping to change India's gender-discriminatory practices, too: This year, Karnataka will become the first state in India to make schooling free for girls, while boys will continue to pay.
Krishna, who studied law at George Washington University as a Fulbright scholar, began as a legal academic. But he was inspired by family history to go into politics. His people are glad he did.
N. Chandrababu Naidu (int'l edition)
In his five years running Andhra Pradesh, Naidu, 50, has used his decisiveness and drive to transform the state. Before he took office, it was ranked 22nd as a place to do business by a newsmagazine poll; it's third today. Naidu has tripled the number of engineering colleges and increased telephone lines from 600,000 in 1995 to 2.2 million now. Naidu also lobbied U.S. diplomats to persuade President Clinton to visit in March.
With such moves, he's attracting investors. Foreign investment reached $19 million by the first quarter of this year, up $16.7 million in the past 12 months. And last year, the Wharton-Kellogg Indian School of Business picked Hyderabad to set up shop. With Naidu in charge, there'll be plenty more investors to come.
Perfecto Yasay (int'l edition)
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