New Order
General Suharto emerged from the turmoil of the abortive 30 September 1965 coup in Indonesia as the ascendant political player in that country, and he gradually instituted what came to be known as the New Order (Orde Baru). After effectively deposing Sukarno in March 1966, Suharto firmly established his regime, officially being installed as Indonesia's second president in March 1968. His main policies comprised depoliticizing Indonesian society, the dual function (dwifungsi) of the military, and economic development. Conducive foreign policy helped restore sociopolitical stability: Indonesia ended its confrontation with Malaysia, rejoined the U.N., and was influential in creating the Association of Southeast Asian Nations (ASEAN) in 1967.
Depoliticization essentially meant the purge of Communism and any criticism of the new regime, accompanied by a reduction of the number of political parties to three in 1973: the United Development Party (PPP), the Indonesian Democratic Party (PDI), and the Joint Secretariat of Functional Groups (GOLKAR)—an allegedly nonpartisan, government-supported organization representing various segments of the nation. Restoration of "social harmony" heavily relied on the dual function of the military, which enabled its members to hold both legislative and executive positions within the political system.
Economic development was facilitated by the foreign investment law of 1967, which attracted foreign investment and aid. The resultant increase in manufacturing and oil and gas production led to the emergence of a middle class increasingly dedicated to conspicuous consumption. The mid-1980s decline in oil prices prompted a shift from oil and commodity exports to the export of manufactured goods and the promotion of tourism.
The government's successful attempts to distribute development more evenly across the archipelago helped abate the separatist feelings of the 1950s. Opposition to Jakarta, however, never fully subsided in Irian Jaya, Aceh, or East Timor (the latter was forcefully integrated into Indonesia in 1975–1976). The country achieved recognition as a developing-world leader and major regional player.
When, in the wake of the 1997 Asian financial crisis, economic activity collapsed, sociopolitical stability deteriorated and with it the legitimacy of the New Order government. Unremitting demonstrations against Suharto's "crony capitalism" prompted his resignation in May 1998. Resurgent political Islam has partially filled the ensuing ideological vacuum.
Further Reading
Hill, Hal, ed. (1994) Indonesia's New Order: The Dynamics of Socio-economic Transformation. St. Leonards, Australia: Allen and Unwin.
Suryadinata, Leo. (1996) Indonesia's Foreign Policy under Suharto. Singapore: Times Academic Press.
Vatikiotis, Michael R. J. (1993) Indonesian Politics under Suharto: The Rise and Fall of the New Order. London and New York: Routledge.
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