Asia Sentinel: Indonesia for Sale

On Nov. 29, 2007, on the 10th floor of a marble-clad office block in Jakarta, the scion of one of Indonesia’s wealthiest families met with a visitor from the island of Borneo. Arif Rachmat, in his early 30s, was heir to a business empire and an immense fortune that would place him among the richest people in the world. His father had risen as a captain of industry under the 32-year dictatorship of President Suharto. After a regional financial crisis in 1998 forced the dictator to step down, Arif’s father had founded a sprawling conglomerate, the Triputra Group, with businesses ranging from mining to manufacturing.

Arif had come of age as one of the most privileged members of the post-Suharto generation, attending an Ivy League university and cutting his teeth in a U.S. blue-chip company. He had recently returned home to join the family firm, taking charge of Triputra’s agribusiness arm. Now he meant to position it as a dominant player in Indonesia’s booming palm oil industry.

Arif’s visitor that Thursday was Ahmad Ruswandi, a chubby young man with glasses and a propensity to break out into a nervous smile and giggle. A contemporary of his host at the age of 30, Ruswandi came from a different place, but could have been forgiven for thinking his fortunes were on the rise as he rode the elevator up the Kadin Tower.

Ruswandi’s father, Darwan Ali, was chief of a district in Indonesian Borneo named Seruyan, putting him at the vanguard of a new dawn of democracy in Indonesia. Darwan was among the first of the politicians chosen locally to run districts across the nation, after three decades in which Suharto had held the entire country in a tight grip. These politicians, known as bupatis, were afforded vast new powers, including the ability to lease out almost all of the land within their jurisdictions to whomever they deemed fit to develop it.

The scene in the Kadin Tower would give some indication of the direction Darwan had taken. As the afternoon rush hour descended on the capital, his son Ruswandi sold Triputra a shell company with a single asset, a license to create an enormous oil palm estate in Seruyan. The license had been issued by Darwan himself, who was now in the midst of an expensive reelection campaign. It was not the first shell company Ruswandi had sold, and he was not the only member of the family who would cash in on Seruyan’s assets.

These deals played a part in one of the greatest explosions of industrial agriculture the world has ever seen. In a few short years after Darwan and dozens of other bupatis assumed authority, plantations multiplied throughout the archipelago nation. The resulting destruction of Indonesia’s tropical rainforests catapulted it toward the top of the list of countries fueling climate change.

This agricultural surge is routinely cast as an economic miracle, rapidly bringing income and modernity to undeveloped regions. In this narrative, expansion was planned, controlled and regulated. The harm to the environment was an unfortunate side effect of the moral imperative of development.

But there is another version of the story, one that played out through backroom deals and murky partnerships. In this story, unaccountable politicians carved up other people’s land and sold it to the children of billionaires. Farms that fed the rural poor were destroyed so that multinationals could produce food for export. Attempts to reign in the bupatis were undermined by their ability to buy elections with palm oil cash, and they came to be known, in a nod to Suharto, as “little kings.”

Indonesia for Sale is a collaboration between the environmental science and conservation news and information site Mongabay and The Gecko Project, an investigative reporting initiative established by UK-based nonprofit Earthsight. The series examines the political interests underpinning the land rights and deforestation crisis in Indonesia. It is the product of nine months’ reporting, interviewing fixers, middlemen, lawyers and companies involved in land deals, and those most affected by them. The palm oil fiefdom is the first in the Indonesia for Sale series and will be serialized on Asia Sentinel over the next six days.

Read the Asia Sentinel for the six-part series.

The World Wildlife Fund reports on everyday products that contain palm oil.