Suharto signs reform package under watchful eye of the IMF

After the signing of Indonesia's financial reform package, there are rumblings of resentment from those with the most to lose. Jakarta's business elite, including the family of President Suharto, may no longer get many of the credits and government subsidies that propped up their businesses and sustained their lavish lifestyles over several decades.

Indonesia's first family and their friends have amassed vast wealth on the back of the 90s economic boom. President Suharto's family's fortune is believed to be as vast as Indonesia's IMF bail-out.

Last year's opulent wedding ceremony for the marriage of President Suharto's youngest son, Tommy, may have been the final glimpse of the Suharto dynasty's unashamed extravagance.

'Timor' car project: facing the loss of tax breaks

The economic reforms are particularly bad news for Tommy Suharto. The business tycoon has now lost tax breaks for his national car project, the Timor, as well as his monopoly on cloves, the key ingredient in Indonesia's popular kretek cigarettes.

"This is a new from of neo-colonialism from advanced countries," he complained.

Popular clove cigarettes - another Suharto monopoly

Further bankruptcies or job losses could make President Suharto's position untenable but major economic reform was clearly necessary and could buy Indonesia's first family some time.

However, the IMF-inspired austerity programme will hit ordinary people hardest. Fuel and food costs are rising with the removal of subsidies, and this has already prompted unrest.
 

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