Indonesia Restructuring: Power Sector
First, Wow, I can not imagine if the study is undertaken without technology called Internet. All the documentation is available in Judicial Body, NGO, or third party information. And second, at the fundamental level is about the writing, the spirit to documenting and communicating message. Beautiful.
Background of Conflict
Let me begin with Electricity Law 30/2009, 15/1985 version and 20/2002 version. The spirit of this Electricity Law is liberalization and privatization of electricity sector which is very complicated. The level of complexity is similar with Hukum Waris (Inheritance), which is complicated as old money. In 30/2009 the significant difference is on Article 11 that Power Sector can be from State Own or Private Sector. Imagine, that our parents died, they left a big house, their children needs to decide which is the best option for that big house. If they have three children, first children might choose to sell the house, second children might choose to repair the house, the third children might choose to bring the partner into the house. Which one is correct? any approach can be correct, as any approach might be incorrect depend on the position.
Pro-Liberalization Perspective: Government, Donor, Investor
Law 20/2002 argued inspired by ADB Power Sector Restructuring Program, a 400 million USD loan on March 1999. This Law then revised by MK in 2004. But the background of this restructuring is more complicated as LOI signed by Camdessus Oct 1997 on the deregulation policies that need to be signed by Indonesia in order to get financial support.
in Financial Sector Restructuring for example, IMF itself stated in their report of 1999 Financial Sector Restructuring that “The policy is successful in all countries, except in Indonesia, where economic and political turmoil made the situation unmanageable during the first six months”. See, even IMF itself emphasis on the importance of political stability. Check also IMF working paper on 1997-1999 Banking Crisis
Contra-Liberalization Perspective: Labour Union, Political Part
PLN Labour Union argues that Liberalization is against UUD 1945, they have argument for this, see the MK decision.
– Putusan MK 001-021-022/PUU-I/2003
– Putusan MK 149/PUU-VII/2009
Agus Sari argues (in 2000?) that “power sector in Indonesia is not ready for restructuring, tariff structure has gained the most interest due to the populist political agenda, and environmental issues gain the weakest support from due to involved in any discourse led by international financial institutions which in debt-laden Indonesia, this politically-incorrect”
Written by same Agus Sari “Indonesian power sector restructuring was influenced by the 1997 financial crisis and ongoing economic crisis both stimulated and complicated power sector restructuring. The collapse of the currency bankrupted the national electric utility; on the other hand, it made constituencies for labor (PLN employees union) and consumers (students and NGOs) more likely to oppose any reform that implied job losses or price increases.” Moreover, Power Sector Restructuring is argued has been started since 1989 where IMF recommend privatization and Soeharto approves first IPP in 1990
Historical (Sequential) Perspective
The historical perspective of Indonesia Restructring start with argument that there is no ‘smart/genius’ president, all the leader has the same capability.
- First Amandemen of UUD 1945 (1999) Indonesian Magna Carta, Limit of President Term, Gus Dur
- Second Amandemen 2000, DPR Election
- Third Amandemen 2001, DPD, MK, Megawati
- Fourth Amandemen 2002, Article 33 on Economy Platform
- UU 30 2002 KPK
- Direct Election Presidency 2004, SBY
- Regional Head Election 2005
- KPK Antasari 2007, Internet, Anti Corruption