(Chinese Overseas - History, Literature, and Society) Marleen Dieleman, Juliette Koning, Peter Post-Chinese Indonesians and Regime Change-Brill Academic Pub (2010)

Chinese Indonesians and Regime Change
Chinese Overseas
History, Literature, and Society
Chief Editor
Wang Gungwu
Subject Editors
Evelyn Hu-DeHart, David Der-wei Wang, Wong Siu-lun
Editorial Board
Ien Ang, Shirley Geok-lin Lim, Liu Hong, Frank Pieke,
Elizabeth Sinn, Jing Tsu
VOLUME 4
Chinese Indonesians and
Regime Change
Edited by
Marleen Dieleman, Juliette Koning, and Peter Post
LEIDEN BOSTON
2011
Cover Image: The Board of Directors of the Oei Tiong Ham Concern, 1952.
This picture was taken on August 20, 1952, in the ballroom of Hotel des Indes
( Jakarta) during a cocktail party to celebrate Tan Tek Pengs 35th anniversary with
Kian Gwan Co. (Indonesia) Ltd. N.V.
Standing from left to right: Yap Kie Ling, Mrs. Oei Ing Swie, Oei Ing Swie, Mrs. L. Tan
Tek Peng-Souw, Tan Tek Peng, Mrs. M.L. Oei Tjong Tjay-Blanc, Oei Tjong Tjay,
Tjoa Soe Tjong.
Courtesy Mrs. Lieke Oei Tiang Han.
This book is printed on acid-free paper.
Library of Congress Cataloging-in-Publication Data
Dieleman, Marleen.
Chinese Indonesians and regime change / by Marleen Dieleman, Juliette Koning,
and Peter Post.
p. cm. (Chinese overseas ; v. 4)
Includes bibliographical references and index.
ISBN 978-90-04-19121-1 (hardback)
1. ChineseIndonesiaHistory. 2. ChineseIndonesiaPolitics and government.
3. IndonesiaPolitics and government20th century. 4. Regime changeIndonesia
History20th century. 5. IndonesiaEthnic relations. I. Koning, Juliette. II. Post,
Peter, 1953 III. Title. IV. Series.
DS632.3.C5D54 2010
959.8004951dc22
2010029370
ISSN 1876-3847
ISBN 978 90 04 19121 1
Copyright 2011 by Koninklijke Brill NV, Leiden, The Netherlands.

Koninklijke Brill NV incorporates the imprints Brill, Hotei Publishing,
IDC Publishers, Martinus Nijhoff Publishers and VSP.
All rights reserved. No part of this publication may be reproduced, translated,

stored in a retrieval system, or transmitted in any form or by any means, electronic,
mechanical, photocopying, recording or otherwise, without prior written permission
from the publisher.
Authorization to photocopy items for internal or personal use is granted by

Koninklijke Brill NV provided that the appropriate fees are paid directly to
The Copyright Clearance Center, 222 Rosewood Drive, Suite 910,
Danvers, MA 01923, USA.
Fees are subject to change.
CONTENTS
Acknowledgements ..................................................................... vii

Abbreviations .............................................................................. ix
Glossary ....................................................................................... xi
Contributors ................................................................................ xiii
PART I
INTRODUCTION
Chapter One Chinese Indonesians and Regime Change:

Alternative Perspectives ......................................................... 3
PART II
POLICY AND DIGNITY:

CHINESENESS DURING AND AFTER THE NEW ORDER
Chapter Two Business, Belief, and Belonging: Small Business

Owners and Conversion to Charismatic Christianity .......... 23
Juliette Koning
Chapter Three Assimilation, Differentiation, and

Depoliticization: Chinese Indonesians and the Ministry of
Home Affairs in Suhartos Indonesia .................................... 47
Nobuhiro Aizawa
Chapter Four Diversity in Compliance: Yogyakarta Chinese

and the New Order Assimilation Policy ............................... 65
Andreas Susanto
vi contents
PART III
JUSTICE AND REPRESENTATION:

THE CHINESE IN THE NETHERLANDS EAST INDIES
Chapter Five The Chinese Connection: Rewriting Journalism

and Social Categories in Indonesian History ....................... 93
Nobuto Yamamoto
Chapter Six The Loa Joe Djin-Case: A Trigger to Change ... 117
Patricia Tjiook-Liem
PART IV
SURVIVAL AND CREATIVITY:

CHINESE BUSINESS RESPONSES TO REGIME CHANGE
Chapter Seven Crisis Management and Creative Adjustment:

Margo-Redjo in the 1930s .................................................... 141
Alexander Claver
Chapter Eight The Oei Tiong Ham Concern and the

Change of Regimes in Indonesia, 19311950 ..................... 169
Peter Post
Chapter Nine Continuous and Discontinuous Change in

Ethnic Chinese Business Networks: The Case of the
Salim Group .......................................................................... 201
Marleen Dieleman
Index ........................................................................................... 227

ACKNOWLEDGEMENTS
This volume emerged out of a series of monthly seminars held at the

Netherlands Institute for War Documentation (NIOD) in Amsterdam
from 2006 to 2007, as well as the international workshop Indonesian
Chinese Studies at the Crossroads? Challenges and ProspectsDutch and Japanese
Explorations, held in Amsterdam on February 1213, 2007, and jointly
organized by the Center for Southeast Asian Studies (CSEAS, Kyoto
University), NIOD, ASiA (University of Amsterdam), and Leiden Uni-
versity. A selection of original papers presented at the seminars and the
workshop have been included in the volume. They have been revised
and edited for this publication. We wish to thank the hosting institu-
tions as well as all participants of the seminars and workshops for
their contributions and comments. Special thanks are due to Kosuke
Mizuno (CSEAS) and Sikko Visscher (then at ASiA, University of
Amsterdam) for their support in organizing these events.
Marleen Dieleman
Juliette Koning
Peter Post
ABBREVIATIONS
ABRI Angkatan Bersenjata Republik Indonesia Armed Forces

of the Republic of Indonesia
BAKIN Badan Koordinasi Intelijen Negara National Intelligence
Coordinating Agency
BAKOM PKB Badan Komunikasi Penghayatan Kesatuan Bangsa Com-
munication Body of Organizing National Unity
BAPERKI Badan Permusyawaratan Kewarganegaraan Indonesia
Consultative Body for Indonesian Citizenship
(organization representing Chinese Indonesians in
the 1950s)
BCA Bank Central Asia
BKMC Badan Koordinasi Masalah Cina Coordinating Agency
on the Chinese Problem
BPKB Badan Pembina Kesatuan Bangsa Body of Promoting
National Unity
CFB Chinese Family Business Term for ethnic Chinese
family firms
CHH Chung Hwa Hui Chinese Association
DEPDAGRI Department Dalam Negeri Ministry of Home Affairs
DEPDIKBUD Department Pendidikan dan Kebudayaan Department of
Education and Culture
Direktorat Directorat Kesatuan Bangsa Directorate of National
KESBANG Unity
Dirjen SOSPOL Directorat Jenderal Sosial dan Politik Directorate
General of Social and Political Affairs
DKI Jakarta Daerah Khusus Istimewah Jakarta Special Capital
District of Jakarta
FGBMFI Full Gospel Business Men Fellowship International
G30S Gerakan 30 September 1965 September 30th Movement
GBI Gereja Bethel Indonesia Indonesian Bethel Church
Gerindo Gerakan Rakyat Indonesia Indonesian Peoples
Movement
GPdI Gereja Pantekosta di Indonesia Pentecostal Church of
Indonesia
x abbreviations
KOPKAMTIB Komando Pemulihan Keamanan dan Ketertibaan Opera-

tional Command for the Restoration of Security and
Order
KTP Kartu Tanda Penduduk National Identity Card
LPKB Lembaga Pembina Kesatuan Bangsa Institute for the Pro-
motion of National Unity
MNC Multi-National Company Large firm operating in differ-
ent countries
NA Nationaal Archief National Archives, The Hague
OTHC Oei Tiong Ham Concern
PID Politieke Inlichtingen Dienst Political Intelligence Service
PITI Perhimpunan Islam Tionghoa Indonesia Association of
Indonesian Muslim Chinese
PKI Partai Komunis Indonesia Indonesian Communist Party
PRC Peoples Republic of China
PTI Partai Tionghoa Indonesia Indonesian Chinese Party
RT Rukun Tetangga Neighborhood Association
RW Rukun Warga Administrative Units consisting of
several RT
SARA Suku, Agama, Ras dan Antar Golongan Acronym for
ethnic, religious, racial and group identities
Sarpoci Sarikat Pegawai Oei Tiong Ham Concern Indonesia Union
of Employees of the Oei Tiong Ham Concern
Indonesia
SBKRI Surat Bukti Kewarganegaraan Republik Indonesia Republic
of Indonesia Citizenship Certificate
SCUT Staf Chusus Urusan Tjina Special Staff for Chinese
Affairs
SESKOAD Sekolah Staf dan Komando Angkatan Darat Army Staff
and Command College
SNPC Sekolah Nasional Projek Chusus Special Project National
Schools
THKK Tiong Hoa Hwee Koan Chinese Association
TVRI TV Republik Indonesia National Television of Republic
of Indonesia
WNA Warga Negara Asing Foreign Citizen
WNI Warga Negara Indonesia Indonesian Citizen
YSB Yokohama Speciebank
GLOSSARY
Ahli Asimilasi assimilation expert

Arisan neighborhood savings club, rotating credit
association
Asimilasi assimilation
Baba see peranakan
Cap Go Meh celebration of the 15th night of the New Year
festival
Cina Official term for Chinese and China under the
New Order, considered insulting by Chinese
Indonesians
Crisisinvoerordonnantie Crisis Import Ordinance
Djaksa native prosecutor
Doenia pers journalistic world
Dwi fungsi dual function, double role of the armed forces
in the military and in politics
Gerakan 30 September September 30th movement
Gotong royong community self-help, mutual cooperation
Guanxi Chinese concept denoting networks or connec-
tions
Imlek Hokkien term for Chinese New Year
Integrasi integration
Kampung village or small urban area
Kakyo Sokai ( Jap.) Chinese Association
Kasno (bekas Cino) former Chinese
Kenpeitai Japanese military police
Kirno (mungkir Cino) deny Chinese
Masalah Cina the Chinese problem
Non-Pribumi non-native, non-indigenous (until the late 1990s
including Chinese Indonesians)
Orde Baru New Order (regime president Suharto 1965
1998)
Pamrih reward
Pancasila five basic principles of the Indonesian state (state
ideology)
Pecinan Chinese quarter
xii glossary
Pelindung protector
Pembauran assimilation
Peranakan person of mixed ancestry
Pers delict press offense
Pribumi native, indigenous, sons of the soil
ronda or siskamling communal neighborhood guard duty at night
Ronda guard control
Suku ethnic group
Tionghoa Hokkien term for Chinese
Totok full blooded
Wijkenstelsel zoning system
CONTRIBUTORS
Nobuhiro Aizawa is researcher in the Institute of Developing Econ-

omies-JETRO Japan and a Visiting Fellow in Cornell University. He
holds a Ph.D. in Area Studies from Kyoto University. His current
research interests focus on Chinese Indonesians, Indonesian politics
and Thai politics. Books and chapters in edited volumes include Ethnic
Chinese and the StateMasalah Cina in Indonesia (2010, in Japanese),
By Accident or By Design?the 2010 Indonesian Election Turmoil (2010,
in Japanese), Political Turmoil and the Economic CrisisThailand 2008
(2009, in Japanese).
Alexander Claver is senior political and strategic analyst at the Dutch

Ministry of Defense. He studied history at Utrecht University where
he specialized in Dutch economic history and holds a Ph.D. in social
sciences from the VU University Amsterdam. His doctoral research
focused on trade finance and commercial relations between Europeans
and Chinese in colonial Indonesia. (Capital and Commerce in Colonial
Java 2006). His research interests include the legal profession in Indone-
sia and the history of the Armenians in Indonesia. Recent publications
include Struggling for justice. Chinese commerce and Dutch law in the
Netherlands Indies 18001942 (2008), A colonial debt crisis. Surabaya in
the late 1890s and contributions to Economics and Finance in Indonesia
(2007, no. 55 and 2009, no. 57).
Marleen Dieleman is visiting fellow at NUS Business School in Singa-

pore. She holds a Ph.D. from Leiden University in The Netherlands. Her
current research aims at doing in-depth and longitudinal case studies
of large family business groups in Southeast Asia, with a focus on cor-
porate strategy. She published a book entitled The Rhythm of Strategy:
A Corporate Biography of The Salim Group of Indonesia (Amsterdam
University Press 2007); a range of academic articles in journals such
as the Journal of Management Studies (2008) and Asia Pacific Journal
of Management (2006, 2010), as well as various book chapters and
teaching cases.
xiv contributors
Juliette Koning is senior lecturer in organisational anthropology at the

Management and Organisational Studies Department, Business School,
Oxford Brookes University. She holds a PhD in social anthropology
from the University of Amsterdam. Her current research interests focus
on Chinese Indonesians and religion, ethnicity and entrepreneurship
in Southeast Asia. Books and edited volumes include Women and
Households in Indonesia, Cultural Notions and Social Practices (2000),
Natural Resources and Social Security (2001), Generations of Change
(2004) and Rope Walking and Safety Nets: Local Ways of Managing
Insecurity in Indonesia (2006). Her recent publications are contribu-
tions to East Asia; An International Quarterly (2007, 24), Copenhagen
Journal of Asian Studies (2009, 27), Inside Indonesia (2009, 95) and an
edited volume on Christianity in Asia (Routledge 2009).
Peter Post is senior-researcher at the Netherlands Institute for War

Documentation (NIOD) and until recently program director of the
Historical Research Program Japan and The Netherlands. He holds a
Ph.D. in social sciences from the VU University in Amsterdam. His
major research interest is in the changing interaction between Japanese
and Chinese business networks in Asia since the late 19th century
and on this topic he has published widely. His most recent publica-
tions include Indonesian Economic Decolonization in Regional and
International Perspective (KITLV Press 2009, co-editor with J. Thomas
Lindblad) and as general editor The Encyclopedia of Indonesia in the
Pacific War (Brill 2010).
Andreas A. Susanto is head of the Department of Sociology at the

Atma Jaya Yogyakarta University, Indonesia. He holds a Ph.D. in
Social Sciences from the Radboud Nijmegen University, The Nether-
lands. His academic interests include Chinese Indonesians, sociology
of business, female entrepreneurship, and postmodernism. Published
articles: Chinese Indonesians and the Rise of China: From Business
Opportunities to Questions of Identity (with Juliette Koning), in
E. Kok-Kheng Yeoh and J. Hoi-Lee Loh (eds), China in the World:
Contemporary Issues and Perspectives (Institute of China Studies, 2008);
Safety First: Strategies of Managing Insecurity among Chinese Indo-
nesian in Yogyakarta in J. Koning and F. Husken (eds), Ropewalking
and Safety Nets: Local Ways of Managing Insecurities in Indonesia
(Brill 2006).
contributors xv
Patricia Tjiook-Liem acquired her Master of Law at the University of

Amsterdam and defended her PhD thesis on The legal position of the
Chinese in the Dutch East Indies 18481942 at Leiden University in
2009. Her dissertation covers the important fields of colonial law where
the special position of the Chinese comes to the fore and at the same
time gives a thorough insight in Dutch and Dutch-Indies legislative
policy. Her article on the amendment of the Indies Constitution, the
Japanese law in 1899 (RM Themis, 2005/4) is also based on extensive
archival work. At present the focus of her research interest lies in the
legal history of the Netherlands East Indies/Indonesia.
Nobuto Yamamoto is professor of Southeast Asian Politics in the

Department of Political Science at Keio University, Tokyo. He is the
editor of Questions from Southeast Asia (2009, in Japanese) and Com-
parative Civil Consciousness in Multicultural World (2005, in Japanese),
and co-edited among others Keios Political Science (2008, in Japanese),
Civil Society (2008, in Japanese), Japans Image (2008, in Japanese),
and Media Nationalism (2006, in Japanese). His most recent articles
have appeared in Hougaku Kenkyu (2008, 2009, 2010, in Japanese),
Keio Journal of Politics (2009), Bridging Strategic Asia (2008), Chinese
Identities and Inter-Ethnic Coexistence and Cooperation in Southeast
Asia (2008), and Journal of Political Science and Sociology (2008). His
current research projects include print power and censorship in colo-
nial Indonesia, contentious politics in post-Suharto Indonesia, human
trafficking in Asia, and the social history of journalism in late colonial
Indonesia.
PART I
INTRODUCTION
CHAPTER ONE
CHINESE INDONESIANS AND REGIME CHANGE:

ALTERNATIVE PERSPECTIVES
Introduction
When President Suharto stepped down in May 1998, a fundamental

regime change occurred that would change the lives of most Indone-
sians. The fall of the Suharto regime was, however, particularly sig-
nificant for Chinese Indonesian population groups. After more than
thirty years of restrictions, Chinese Indonesians were now allowed to
publicly display their religions, beliefs and customs and to start civil
rights groups to reassess their position in society. The study of Man-
darin has become popular among young Chinese Indonesians and
China is now a popular holiday destination for the upper class. The
Indonesian market is flooded with Chinese products forcing Indone-
sian businessmen, many of whom are of Chinese descent, to form new
partnerships, create new networks in the Indonesian administration,
and reorientate themselves in the global economy. In addition, the
China-revival in post-Suharto Indonesia led to public debates about
questions of identity and belonging of the Chinese Indonesian com-
munities, a process that still continues.
The end of Suhartos Orde Baru (New Order) was the fourth major
regime change Indonesia has witnessed since the early twentieth cen-
tury and all these power shifts had profound impacts on the daily lives
of Chinese Indonesian communities and society at large. The essays
in this book look at fundamental transitions in Indonesian society
from various angles and different disciplines and show that Chinese
Indonesians are a diverse and socially active group, whose histories
and agencies are heterogeneous and locally embedded and cannot be
homogenized in a singular framework.
As is well known, regime changes in Indonesia have often been
accompanied by fierce anti-Chinese violence by elements in the
general public and certain state-agents (Coppel 1983; Mackie 1976;
4 marleen dieleman, juliette koning, and peter post
Purdey 2006; Shiraishi 1997; Somers 1965; Twang 1998). This has
been the case with the overthrow of the Dutch colonial regime by the
Japanese military in 1942, the so-called Bersiap period during the first
year of the Indonesian Revolution of 194549, the coup that marked
the transition from the Sukarno to the Suharto regime in 1965, and in
May 1998 with the fall of Suharto. Themes of violence, discrimination
and oppression during the transitory periods from the Dutch, to the
Japanese, to the Sukarno and to the Suharto regimes have therefore
been prominent in the literature on Chinese Indonesians. This singu-
lar focus we believe needs correction. The Chinese in Indonesia were
not only by-standers or innocent victims of history, but were simul-
taneously active agents of change during periods of crises, war, and
revolution. The literature on the Chinese Indonesians that appeared
after May 1998 testifies to this. We can read for instance how Chinese
Indonesians started to revive Sino-Indonesian culture (Allen 2003),
became active in civil society groups (Giblin 2003), began to explore
their Chinese identity (Hoon 2006; Turner and Allen 2007) and set
out to reassess their position in Indonesian society (Coppel 2003; Her-
lijanto 2005; Lindsey 2005). This volume adheres to the new directions
that this growing body of literature offers and above all demonstrates
that there have been many other moments in Indonesian history dur-
ing which Chinese Indonesians were active agents of change, both in
their private lives, through their companies and in society at large.
Hence, this book shows how Chinese Indonesians played an active
role in shaping society during regime changes, and found creative and
constructive ways to deal with situations of adversity and crisis. The
chapters demonstrate that regime changes, throughout Indonesian his-
tory, did not only pose threats of violence, but also offered chances and
opportunities that induced agency on the part of Chinese Indone-
sians to shape their destinies and that of the country.
Chinese Indonesians: State-Centered and Diaspora Perspectives
Chinese Indonesian studies have generally been dominated by two

prominent paradigms. On the one hand by state-centered studies
in which political themes and questions of citizenship prevail and on
the other hand by studies in which Chinese Indonesians are under-
stood as part of transnational diaspora networks of so-called overseas
Chinese.
chinese indonesians and regime change 5
In the state-centered narratives the Chinese are typically presented

as invasive agents, as instruments of colonial and global capital. This
is, for example, the case for the period 1920s1960s, when Indonesia
experienced two regime changes, from Dutch colonial to the Japanese
period and subsequently to an independent Indonesia. The historiog-
raphy on the Chinese for this period has generally taken a political
perspective related to the central (colonial ) state level and has mostly
refrained from social and economic approaches (Suryadinata 1981,
1992). Whereas studies on the Chinese in the Indies during the period
18701910s dealt with them as an integral part of larger society, the
main focus from the 1920s onwards shifted to their ambivalent role in
the nationalist enterprise. In doing so these latter studies have lifted
the Chinese from their socio-economic embeddedness in indigenous
and urban society, and mainly stressed their problematic political
incorporation in the Dutch colonial state, their collaboration with or
resistance to the Japanese military regime, or their attitudes towards
Indonesian national policies, thereby greatly contributing to the con-
ceptualization of the so-called masalah Cina (Chinese problem) in Indo-
nesia (Tan 1997).1
Until a decade or so ago most social scientists on decolonization pro-
cesses in Southeast Asia have mainly been working within the nation-
state paradigm stressing the achievements of the nationalist struggle
and independence movements against the colonial oppressor and its
local agents (Anderson 1974; Abdullah 1997). In the post-war debates
on modernization and nation-state building, simplified dichotomies
ruled the dice. Within these frameworks no need was felt to delve
deeper into the experiences of the Chinese, since most were regarded
as alien intruders, collaborators and profiteers of an unjust Dutch colo-
nial order and a violent Japanese regime and exploiters of the indig-
enous populations, actually preventing their emancipation rather than
supporting it (cf. Wertheim 1978). Hardly any attention was given to
the daily experiences of the different groups of Chinese from different
walks of life. How did they experience these changes, and how did
they respond to them? What did it mean for the organization of their
1
An important exception is the work of historian Charles Coppel, whose historical
embeddedness approach embraces not only many different themes (religion, culture,
education, violence, minority status), but also departs from the premise to always
understand Chinese Indonesians in their Indonesian context (Coppel 2002, 111).
communities, and how did it affect relations between different groups

of Chinese, and those between Chinese and Indonesians?
During the Suharto era the powerful state was also the central
framework. The then popular political-economy approaches, with their
emphasis on the wealthy and crony Chinese business conglomerates,
reinforced political stereotypes of economically powerful outsiders that
shaped both state attitudes and popular sentiment towards the ethnic
Chinese (McVey 1992; Robison 1986; Yoshihara 1988). Despite the
fact that only very few of the Chinese Indonesians fitted the stereotype
of rich tycoons who profiteered from state largesse, these approaches
were not always critically examined and continue to dominate public
opinion towards the Chinese Indonesians in general.
Although the limitations of the nation-state paradigm and the polit-
ical-economy approaches have been recognized in Indonesian studies
(e.g. Kratoska, Raben and Schulte Nordholt 2005; Schulte Nordholt
2004), so far only few attempts have been made to reassess these in
regard to the modern historiography of the Chinese Indonesians. The
Chinese hardly have a place as active agents in Indonesian national
historiographies and are marginalized to say the least.
The diaspora perspective, which became popular from the mid-
1980s onward, has created a rather unifying and all-encompassing
Chinese identity for ethnic Chinese living in Southeast Asian con-
texts. In this narrative, the Chinese of Indonesia are represented as part
of a larger network. They are relegated as nodes in a regional structure
that helps them become successful businessmen and maintain their
cultural identity. A large body of literature has emerged arguing that
because of specific cultural traits, such as personal networks, ethnic
affinity and Confucian work ethics, ethnic Chinese people, communi-
ties and businesses function successfully in the new home countries
and across borders (Chan 2000; Hamilton 1996; Kotkin 1993; Red-
ding 1990; Weidenbaum and Hughes 1996). This culturalist approach
from which the phrases Chinese network capitalism and bamboo
network evolved, mainly stems from studies that have been trying to
understand the so-called business success of ethnic Chinese in the
Southeast Asian economies. Quite often the traits related to this busi-
ness literature came to dominate the discourse on other aspects of Chi-
nese life in Southeast Asia as well. Within this culturalist framework
the hardworking Chinese built upon their cultural and social capital
in order to enrich themselves, their families and their communities
both in Southeast Asia and China. A shared culture and ethos created
solidarity, embodied in ties with their ancestral land, or qiaoxiang (Douw

1999), clan and temple organizations, enabling overseas Chinese to
open economic frontiers in trade, agriculture and mining from the sev-
enteenth century onwards. The opening of the Chinese economy from
the 1980s onward has given new momentum to these approaches and
it is often noted how overseas Chinese2 were not only the first, but
also the most important investors in mainland China until the end of
the twentieth century (e.g. Yeung and Olds 2000). This literature has
also emphasized the transnational networks among the overseas Chi-
nese, describing how extended families fanned out all over East Asia
(Backman 2001). Cases of ethnic Chinese businessmen cooperating
with co-ethnics in other parts of the region have been extensively ana-
lyzed in this body of literature, the interpretation being that Chinese
capitalism has led to the emergence of a hybrid transnational econ-
omy (Weidenbaum and Hughes 1996) that crossed state boundaries,
leaving the ethnic Chinese literally ungrounded (Ong and Nonini
1997). A strong legacy from this overseas Chinese perspective is
that the Chinese communities in different parts of Southeast Asia are
not only considered comparable, but are essentially judged to be the
same, since they share a similar Chinese identity and culture that went
almost unchanged for centuries, thus positioning them as outsiders in
their respective host societies.
Attempts have been made to de-essentialize or demystify the
rather essentialist approach to Chinese business conduct taken by
scholars adhering to culturalist perspectives (Carney and Dieleman
2008; Dahles 2007; Gomez and Hsiao 2004; Jacobsen 2004; Koning
2007; Menkhoff and Gerke 2004). These studies argue that too much
emphasis has been placed on the role of a common ethnic identity as
the main explanatory factor for behavior and business success, lead-
ing to a misplaced notion of exclusivity in other parts of daily life as
well. These newer avenues explore among others the importance of
2
There have been lengthy debates on the appropriate terms to address Chinese
migrants. While we do not wish to review these debates here, it is interesting to note
that Wang Gungwu (1990, 1993) argues that with the growing number of people of
Chinese descent taking on the local nationalities of their place of residence, the term
overseas Chinese no longer holds. He instead prefers to use Chinese overseas
(Wang Gungwu 1993, 927). The terminology debate touches upon broader questions
of ethnic identity and whether or not ethnic Chinese population groups in Southeast
Asia were sojourners, would return to China, or could become a fifth column for
China (Reid 1996; Somers 1974; Suryadinata 1979).
inter-ethnic affiliations, but have never really been able to overshadow

the dominant bamboo network literature. Others have pointed out
that the cultural values approach is generally flawed when it comes
to explaining the business performance of small Chinese family enter-
prises in Indonesia that operated in and for the local markets, stressing
that in these cases institutional factors are far more important (Braad-
baart 1995).
Notwithstanding the fact that both paradigms have created an
important and rich body of scholarship on Chinese Indonesians, we
are of the opinion that in order to truly understand the long-term
significance and multiple roles of Chinese Indonesians in the histori-
cal development of modern Indonesian society, we need to step out
of these frames. Both of these frames ascribe a largely passive and
powerless role to Chinese Indonesians in Indonesian history. On the
one hand, the state-centered perspective assumes the locus of power
to be within the state and Chinese Indonesians to be outsiders. The
overseas Chinese paradigm, on the other hand, attributes behavior
to cultural factors and positions the Chinese Indonesians as driven by
business and a set of transnational values that have little connection
with or impact on local changes.
As such, both perspectives have underplayed the important roles
that Chinese Indonesians have played during periods of regime
change in terms of shaping, moderating, or stimulating social change
in Indonesia. In this volume, we aim to complement the literature
with a new perspective showing that Chinese Indonesians displayed
active agency, but by not ignoring the structural features involved. We
do this by focusing on times of crisis and regime change, where pro-
cesses of agency are perhaps more prominently visible and have more
impact than under more stable circumstances. We present narratives
that explore how Chinese Indonesians were deeply embedded in local
processes and how they shaped important social trends in society.
The Power of Regime Change
The concept regime change became an important analytical tool

in social sciences and international relations studies after President
Bill Clinton signed the Iraq Liberation Act of 1998 and George W.
Bush, forty-third president of the United States, used it to overthrow
the Baath regime of Saddam Hussein in Iraq. From then onward,
regime change as a concept is widely used and debated. Although a

thorough review of these discussions is beyond the scope of this book,
this body of literature is helpful for the further refinement of our con-
ceptualization.
Regimes, as argued by Lawson (1993, 185), embody or are an
embodiment of particular norms and procedures. A distinction can
be made between regime change and changes within regimes that cor-
respond with principles and norms on the one hand and rules and pro-
cedures on the other. The suggestion is that if there are changes in the
principles and norms, than the term regime change applies; if there is
a change in rules and procedures it is more apt to speak about changes
within regimes. In the words of Krasner (Lawson 1993, 186), change
of regime involves alteration of norms and principles; and weakening
of a regime involves incoherence among the components of the regime
or inconsistency between the regime and related behavior. Regime
changes can be caused by external and internal forces, as Indonesias
modern history shows.
When Japanese military troops attacked the Netherlands East Indies
in early 1942 and soon thereafter began establishing their military
rule, all things Western and Dutch were eradicated. The European
population was interned, their businesses confiscated, their administra-
tive bulwark taken over by Japanese and Indonesians, and a power-
ful anti-Western campaign started. New laws were introduced and a
war economy that centered on the acquisition of human resources
and strategic materials came into being. This external Japanese force
brought about a regime change in Indonesia that completely altered
existing norms and principles and forced peoplenot in the least the
Chinese Indonesiansto rethink their place and role in society. The
chapter by Post exemplifies such external forces as it investigates
the largest Chinese Indonesian firm in the colonial era, the Oei Tiong
Ham Concern and issues of identification. The firm, like many of
its counterparts, had to survive the turbulent regime changes from
colonial rule, via Japanese occupation to an independent Republic of
Indonesia. The chapter positions the identities of the ethnic Chinese
Oei family in a framework of global citizenship, where family mem-
bers were spread out over the globe, traveled extensively and lived
their cosmopolitan lifestyles. Through rigorous analysis of historical
sources, the chapter shows that the loyalties of the family members
were not with Indonesia, where most of the family lived, or with China
where their ancestors hailed from, or with the Dutch, under whose
rule they achieved great business successes, but that their loyalty was
with the survival of their global business. In conditions of crisis and
adversity, which meant the destruction of property and jailing of lead-
ers and personnel, the family tried to adapt to new conditions as well
as they could and they aggressively moved into new opportunities that
the crisis situation posed, without aligning themselves to one single
national identity.
The coup that brought Suharto to power in 1965 is an example of
an internal force that set in motion a regime change that greatly affected
the Chinese population groups. While the precise details of this his-
torical event are still being revisited and investigated after the end of
the Suharto regime, it is clear that from a society that was character-
ized by a balance of power between the army and the communists,
held together by the charismatic Sukarno who favored a nationalistic
and state-led Indonesia, Suharto shifted the power balance toward
the army and helped crush the communist party (Cribb 1990, 2001;
Vatikiotis 1998). In this process, a massacre against real and imag-
ined communists occurred, the Chinese population groups being one
of the targets. Suhartos rise to power led to a set of policies for the
economy and civil society that impacted the lives of Chinese Indone-
sians profoundly. In the economy, Suharto opened the country for
international trade and investment, and he favored a selected group of
ethnic Chinese businessmen, whom he used to develop the economy,
showering them with incentives.
Indonesia witnessed a period of economic growth during the thirty-
two-year rule of Suharto, which saw the development of many of
todays major Chinese Indonesian family business groups. Dieleman
in this volume explores the strategy and networks of one such business
group, the Salim Group, in detail. The chapter shows how this firm,
whose group leaders were closely connected to Suharto, dealt with
the regime change, also the outcome of internal forces, that occurred
when the Suharto regime fell and was replaced. Dieleman argues that
the Salim Group had outgrown its traditional Chinese and political
networks, and drew from a much wider range of global partnerships,
which allowed it to survive the demise of Suharto. As such, the chapter
criticizes extant theories on ethnic Chinese business networks, which
focus mainly on how companies make use of ethnic or political net-
works, and it shows that large firms broaden their networks and use
them for survival in case of a regime change. It suggests a dynamic
and evolutionary approach to business networking, where family
businesses progressively outgrow narrower forms of networking and

create broader business networks as the family business grows and
matures.
In social and cultural life, Suharto issued discriminatory measures
and limited the freedom of expression for the Chinese population
groups, with the support of the Forced Assimilation program, so as to
ensure that they could not become a political force that could threaten
his rule (Aguilar 2001; Dahana 2004; Heryanto 1998; Tan 2001).
Aizawa and Susanto take up the issue of how this assimilation policy
became established and was subsequently experienced in daily life by
Chinese Indonesian groups. Aizawa analyzes the prominent debate
between assimilation and integration of the ethnic Chinese minority
in Suhartos Indonesia. The debate at the time appeared to be won
by the assimilationists, who became influential in government-linked
organizations, especially after the integrationists disappeared with the
attack on the Indonesian communist party. The assimilation policy
for Chinese Indonesians was discredited after the fall of Suharto, and
some blamed Chinese Indonesian assimilationists for their collabora-
tion with the Suharto regime. The chapter revisits this debate and
the author takes a new perspectivenamely how the state, and in
particular the Ministry of Home Affairs, looked at the Chinese Indo-
nesians. The chapter argues that the Suharto era policies can better
be understood by the overarching goal of de-politicization and the
re-election of Suharto. From a political point of view, the Chinese
minority was treated not as an ethnic minority, but as a potential
political threat that had to be neutralized. While from the perspective
of the Chinese Indonesians the assimilation/integration framework
appears to be useful, the author contends that it was meaningless for
the government, because the latter was mainly focused on ensuring
Suhartos re-election. Re-assessing the debate, Aizawa shows that eth-
nic Chinese leaders have had only a minor role in and responsibility
for what became known as assimilation policies, which were in fact
a method to check on the Chinese Indonesians and ensure their de-
politicization.
How Chinese Indonesians experienced this has so far hardly been
explored. Susantos chapter therefore critically re-thinks the idea that
assimilation was a policy that all Chinese Indonesians followed in simi-
lar ways, as they had no power but to accept it. Susanto examines the
ways in which different Chinese Indonesians in the city of Yogyakarta
have responded to the assimilation policy of the New Order. In doing
so, he takes a position against the portrayal of Chinese Indonesians as

a homogeneous community. Although the assimilation policy touched
the lives of all Chinese Indonesians, this chapter shows the dynam-
ics of the accommodation processes as they were played out within
the various sectors of the Chinese community. The dominance of the
assimilation discourse has created a rather narrow perspective and
obscures the various ways people deal with their social environment.
The chapter does justice to the role of agency during regime changes
and throws a new light on the manner in which Chinese Indonesians
have been active agents in molding the assimilation policy within their
socio-cultural environments.
In addition to external and internal forces that cause regime change,
we also touch upon changes within regimes in Indonesias modern his-
tory. These toomostly in the economic and legal spheres of life
had a large impact on peoples lives. One such change in the economic
realm, which we might call an economic regime change, took place
in the early 1930s when, due to the outbreak of the world economic
crisis, the Dutch colonial regime felt itself forced to abandon its laissez-
faire and free market policies and started to impose strict rules on the
economy. These policies had a large impact on the businesses of the
Chinese and necessitated them to seek other economic opportunities
and use all their creativity to make a successful shift into the controlled
economy that was created. In this regard, Claver reviews the Margo-
Redjo Company, a coffee company from Java. Clavers chapter shows
how a small Chinese Indonesian enterprise was successful in the wake
of the Great Depression that shook the economy of colonial Indonesia
in the 1930s. Margo-Redjos response to the economic regime change
was to adopt marketing and brand management practices that were
ahead of its time, such as clever advertising and consumer loyalty pro-
grams, by giving out coupons that could be accumulated by consumers
and exchanged for a prize. The Tan family, who owned this small
firm, closely followed new consumer marketing trends, primarily from
Japan, and implemented them without much capital in a period of
severe economic crisis. The chapter clearly shows a departure from
typically Chinese middleman roles and successful adaptation to
adverse conditions, mainly through the firms leader, who had access
to international networks and to specialist knowledge in the field of
marketing. The crisis had provided an incentive to shape the future of
the company, and implement changes in the strategy that otherwise
would perhaps not have happened.
In the legal realm, Indonesian history also offers examples of changes

within regimes. Tjiook-Liem narrates the story of an unknown shop-
keeper, Loa Joe Din, who triggered a legal regime change in the colo-
nial period. This regime change occurred in a context of increasing
Chinese nationalism in Indonesia, accompanied by the rise of Chinese
organizations and the influence of China. In addition, many Chinese
were unhappy with the poor quality of the colonial legal system, which
lacked the ability and the will to uphold justice for the non-European
groups in the Netherlands East Indies. Two Dutch ladies accused the
shopkeeper of accessory to theft. He was innocent, but convicted in a
court system which equated Chinese with natives, and which lacked
principles of fairness. The shopkeeper protested against his sentence
in the media and wrote to the Chinese government. Both exercised
pressure on the Dutch government to improve the legal position of
the natives and Chinese, in particular for minor offences, and eventu-
ally this led to a legal regime change where justice was upheld for all
citizens, not only for Europeans. The case of Loa could only make a
difference in a time when discontent with the treatment of the Chinese
minority was high, and with the application of foreign political pres-
sure. By scaling his protests to higher levels, the simple shopkeeper was
able to change the legal situation for all Indonesians, not only those
of Chinese descent.
As shown above, we emphasize an approach to regime change and
changes within regimes that incorporates both institutional pressures
and active human agency. Giddens was among the first to theorize
the interplay of agency and structure bringing these together within
a framework of time and space. Following this structure-agency inter-
play, we take actors and agents to be knowledgeable and, as social
actors, they know a great deal about the conditions and consequences
of what they do in their day-to-day lives (Giddens 1984, 281). Giddens
was concerned with the dialectical process in which practice, struc-
ture and consciousness are produced. In other words, with agency-
structure issues in an historical, processual and dynamic way (Ritzer
2008, 522). This implies an approach in which Chinese Indonesian
agents create, deploy, circumvent, or reshape their ethnic identity,
their position in Indonesian society, and their businesses, while at the
same time regimes are regarded as both constraining and enabling.
This latter issue is taken up by Koning, who explores why charismatic
Christian religious movements have been so attractive for quite a few
Chinese Indonesian business people, and argues that this is closely
related to the Asian Crisis and fall of Suharto, which proved to be both
constraining and enabling at the same time. The chapter presents per-
sonal stories of Chinese Indonesian businessmen, and these are placed
in a social and political context of post-crisis Indonesia, which on the
one hand gave more freedom of expression to Chinese identities, but
on the other also increased a perceived lack of safety. Using the lens of
religion, this chapter shows how these religious movements construct
a global culture modified to the local Indonesian setting. This global
religious culture taps into the need for recognition as a full member
of a community of belonging, whereas these religious movements
are also conducive to business ideas. The author argues that Chinese
Indonesians and global charismatic Christianity embraced each other
after the fall of the Suharto regime because there was a fit.
The general notion that change is embedded within the formal and
informal institutions that collectively structure social lifeand at the
same time that change is induced by active agencyhas found wide
acceptance throughout the social sciences, including in political theory,
sociology, institutional economics, and in organizational sciences (e.g.,
DiMaggio 1988; Krasner 1983; North 1990; Scott 1995). The notion
that actors also have the capability to change existing arrangements
and thereby induce change comes to the fore best in the chapter by
Yamamoto. His chapter shows convincingly how peranakan Chinese
journalists were actively contributing to the spreading of nationalist
ideas. This chapter deals with an aspect of the role of Chinese Indo-
nesians in the late colonial era that has hitherto hardly been inves-
tigated, namely the influence of journalists, and more generally the
media industry, on the nationalist movement. The chapter describes
the role of Chinese Indonesians in this industry, in particular journal-
ists working for newspapers in the 1910s1930s in colonial Indonesia.
Being part of a larger media culture, journalists, both indigenous and
Chinese, created an imagined community of ideas, often propa-
gating against the colonial regime. The tight and intimate networks
within this industry, the culture of citation, and the rotation of people
in high-level positions from one newspaper to the other led to a com-
mon journalist culture that cut across categories of ethnicity, language,
nation, and political orientation. The tight networks across boundaries
ensured that the Chinese Indonesian journalists were deeply embed-
ded in the nationalist political movement in the late colonial era. It
was this nationalist movement that later shaped the regime change
from colonial rule to independence. Yamamotos chapter argues that

hitherto used categories for the Chinese Indonesian, for example based
on political orientation, are not tenable when it comes to describing
the political and professional activities of Chinese journalists. It argues
that not just cultural but rather professional identity is a key element in
understanding Chinese Indonesian journalists and their contribution
to the formation of the Indonesian nation state.
Chinese Indonesians and Regime Change: An Alternative Perspective
Our alternative perspective hence centers on two central features.

First of all, we pay attention to the question of how people influence
and respond to historical events rather than treating them as passive
bystanders or victims determined by these events. This book, with its
focus on knowledgeable agents, treats Chinese Indonesians not as
outsiders but as insiders. Active agency does not necessarily stem from
the most powerful and connected, but can also be driven by ordinary
people. Rather than taking the Indonesian state or Chinese culture as
a starting point, this volume concentrates on the daily lives of these
agents and, as such, pays attention to those actors that have rarely
been studied so far: the ordinary Chinese Indonesian shopkeeper and
small businessman, the Chinese Indonesian youngster. The volume
also explores the inside in great detail, such as family relationships, a
segment of a Chinese community in a small city, a family business, or
the way a Ministry looks at Chinese Indonesians. In this way, we do
justice to the heterogeneity of the Chinese Indonesian communities.
Secondly, our agency-centered approach, in tandem with formal
and informal institutions, allows us to transcend conceptual categories
such as state, culture, and migrant, which have framed such a large
part of todays literature on Chinese Indonesians. Agents of change
can be individuals, groups, or organizations from different walks of life.
Consequently, rather than being narrowly defined within an academic
discipline, our actor-centered approach allows for a mix of viewpoints,
e.g., history, anthropology, sociology, and business studies. By applying
an actor-centered and daily life focus to processes of regime change,
and by using a multi-disciplinary perspective, this volume goes beyond
the state-centered and essentialist overseas Chinese perspectives in an
effort to broach new and innovative research trajectories.
The chapters in this book are therefore clustered in a thematic rather

than chronological manner. In the first clusterpolicy and dignity
Koning, Aizawa, and Susanto address issues of assimilation, identity,
and belonging in novel ways and from quite different perspectives. This
cluster investigates how Chinese Indonesian identity is produced and
played out during and after Suhartos New Order. A central theme
in all these chapters is the interplay between the New Order assimila-
tion policy, aimed at de-politicizing Chinese Indonesians and erasing
Chineseness, and the creative solutions Chinese Indonesians found to
accommodate this policyand its aftermathto their daily lives. The
important message that these chapters convey is that, instead of seeing
Chinese Indonesians as outsiders on whom an assimilation policy was
bestowed (which is of course not denied here), it is more revealing to
use an insider perspective (of both Chinese Indonesians and the New
Order government). Such an approach not only shows that the vari-
ety of responses has been far greater than the literature has shown so
far, it also broadens the scope because the several responses take us
beyond the immediate structures of the Indonesian nation-state.
In the second clusterjustice and representationYamamoto and
Tjiook-Liem present cases of Chinese Indonesians during the colonial
period who set in motion processes of change, and they explore how
Chinese Indonesians established their identity and rights as citizens.
During this period, it was common to classify the different groups in
society using racial distinctions, and the resulting categories were laid
down in the colonial legal framework. Indonesians of Chinese descent
were categorized as Foreign Orientals, being considered distinct from
the native population and from the Europeans. The use of such cat-
egories has been commonplace in much of the literature, but in this
book we attempt to transcend such boundaries, by looking at iden-
tity and representation through the lens of occupational cultures and
through the story of one Chinese Indonesian who triggered a change
in the legal system for all non-Europeans, whether or not of Chinese
descent.
The third clustersurvival and creativityzooms in on several busi-
ness firms and how they maneuvered, quite different than the busi-
ness literature on overseas Chinese has assumed, through periods of
crisis and regime change since the 1930s. Claver, Post, and Dieleman
investigate the activities of Chinese Indonesian businessmen from the
1930s to the Suharto period, focusing in particular on how compa-
nies managed political and economic regime change. Periods of crisis
test the resilience of businessmen as adverse conditions threaten the

company. There is a thriving literature on ethnic Chinese business
networks across Southeast Asia, which focuses mostly on how business-
men use their ethnic and clan networks to gain an advantage in busi-
ness. These networks help businessmen overcoming periods of crisis.
While the chapters in this cluster show this at work, each chapter also
shows how different companies make use of creative ideas, which were
obtained beyond traditional business networks. They demonstrate that
the firms reviewed survived regime changes because they were able to
transcend stereotypical characteristics of Chinese family firms through
smart maneuvering.
Regime changes, therefore, occur not only as inevitable external
events in the everyday live of Chinese Indonesians, but are also to
some extent impacted by their agency. By acknowledging the power
attached to the actor (the agent is knowledgeable and discursively
empowered), as well as by focusing on social practices as played out in
day-to-day life, this volume portrays the walks of life of Chinese Indo-
nesians within the contours of the enabling and constraining structures
of that daily life. By interpreting regime change as a change that goes
hand in hand with a change in norms and principles, as stipulated by
Lawson (1993), we furthermore incorporate structures, but much more
so in the manner in which Giddens has meant it to be, leading to a
more balanced interplay between actor and structure and a dynamic
time-space related study of how Chinese Indonesians actively trav-
eled through Indonesian history.
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PART II
POLICY AND DIGNITY:

CHINESENESS DURING AND AFTER THE NEW ORDER
CHAPTER TWO
BUSINESS, BELIEF, AND BELONGING:

SMALL BUSINESS OWNERS AND CONVERSION
TO CHARISMATIC CHRISTIANITY
Juliette Koning
Introduction
This chapter discusses religious conversion among Chinese Indone-

sians during the turbulent times of the late 1990s, in which Indonesia
witnessed a political regime change.1 I shall in particular explore con-
version to Pentecostal-charismatic Christianity of a group of Chinese
Indonesian business people in the city of Yogyakarta.
Departing from the position that conversion should be understood
both at the individual level as in a broader societal context (Hefner
1993, Kipp 1995, Rambo and Farhadian 1999), ample attention will
be paid to several decisive events of the late 1990s such as the economic
crisis (1997), the riots and anti-Chinese violence (May 1998), the fall of
the Suharto regime two weeks later, the Reform Era (19982004) and
the election of the first democratically-elected president (2004). The
positioning of Chinese Indonesians within this broader societal and
nation-state context will be combined with how individual Chinese
Indonesian business people narrate about these events and their reli-
gious endeavors. The central aim is to come to a better understanding
of why some Chinese Indonesians have turned to Pentecostal-charis-
matic Christianity at this particular moment in time. What are the
hopes and dreams that go along with the status of being a born-again,
Chinese Indonesian, Christian in Muslim dominated Indonesia? What
has inspired the choice for Pentecostal-charismatic Christianity?
1
I will use the term Chinese Indonesians for those Indonesians with a Chinese
descent line in stead of ethnic Chinese as it does better justice to the dual affinities
most of them feel and express (see also Koning 2007). For a further discussion on this
terminology see Coppel (2003). The term ethnic Chinese is only used if I refer to
literature that uses this terminology.
24 juliette koning
After Islam (eighty-eight percent), Christianity constitutes the second

largest religious group (almost nine percent) in Indonesia (Ananta et al.
2008, 30). Although there are no reliable statistics on the more than
250 Christian denominations and their membership (Goh 2005, 59),
there are indications that Christianity is on the rise among Chinese
Indonesians. A newspaper article speaks about the majority of Chi-
nese Indonesians now being Christian (Brazier 2006), and research
results indicate that the increased number of Christians in Indonesia
(from 7.4 percent in 1971 to 8.9 percent in 2000) could be related
to Chinese Indonesians who converted to Christianity (Suryadinata
2005, 89). In other words, Chinese Indonesians are a prominent group
within the Christian community in Indonesia (Goh 2004, 7).
The growth of Christianity can partly be ascribed to the expansion
of Pentecostal-charismatic Christianity with which Indonesia follows
a worldwide trend.2 Pentecostal-charismatic Christianity is considered
the fastest growing global religion of the twentieth century, with some
500 million people who feel connected with one of its many manifesta-
tions (Anderson 2005, 1). It is a form of Christianity in which believ-
ers receive the gifts of the Holy Spirit and have ecstatic experiences
such as speaking in tongues, healing, and prophesying (Robbins 2004,
117). Again, accurate numbers on Pentecostal-charismatic Christians
in Indonesia do not exist. Many groups and movements assemble in
restaurants, hotels, conference halls, and private buildings because
they lack the necessary permit to operate as house of worship.3
Whereas Chinese Indonesians are a minority in ethnic and religious
terms, the reverse seems to count for their economic position. Their
visibility in the economy is argued to be a colonial heritage. Because
ethnic Chinese were not allowed to own land or join the civil service,
many opted for an occupation in trade and business. Besides being
strong in the distribution and retail market, a small group of Chinese
managed to accumulate wealth through revenue farming, tax collect-
ing, and money lending. These activities contributed significantly to
the negative stereotypes of Chinese businesses (Chua 2008, 108). This
2
There are indications that Evangelical Christianity is on the rise as well. See for
instance news reports in the International Herald Tribune of 20 September 2008,
and themalaysianinsider.com of September 5, 2008. Accurate numbers are, however,
not available.
3
The request for a permit to establish a house of worship needs to be sanctioned
by at least ninety worshippers and sixty people from other faiths residing in the area;
this requirement is in particular difficult to meet for religious minority groups (Decree
No. 1/2006, revision of joint ministerial Decree 1969).
business, belief, and belonging 25
negative image is supported by often repeated but rarely substanti-

ated claims that Chinese Indonesians control seventy percent of the
economy (Coppel 2008, 132) and hold some eighty percent of Indo-
nesias corporate assets (Yeung and Olds 2000, 79). Such referencing
has contributed to the idea that all Chinese Indonesians are extremely
wealthy, while in fact such numbers only refer to a handful of quite
powerful business families (Susanto 2008, 3).
The ascribed and achieved ethnic and economic status can be said
to have had its backlash; in times of economic or political turmoil
Chinese Indonesians have often been targets of local frustrations, with
the most recent outburst of aggression in May 1998 when Chinese
shops and houses were burned down and Chinese Indonesian women
were raped (Purdey 2006). This Chinese card was played in order
to direct the anger of the people away from the government and
towards defenseless Indonesians of Chinese origin (Chua 2008, 113),
a strategy employed more than once during New Order periods of
instability.
Hence, the case here under scrutiny is one in which a number of
Chinese Indonesiansmostly occupied in business and trade and con-
fronted with a history of material and immaterial insecurityactively
chose to convert to Pentecostal-charismatic Christianity. As stated, the
aim is to unravel the reasons behind this choice during the regime
change of the late 1990s.
The chapter proceeds as follows. The next section discusses the
empirical data gathering process. This is followed by a brief outline,
in a contextual manner, of the socio-political and socio-economic posi-
tion of Chinese Indonesians as well as the major characteristics of
Pentecostal-charismatic Christianity. Next, three cases are presented
that show how the converted Chinese Indonesians relate their new-
found religion to their personal, business, and nation-state positions.
In the final section I shall analyze these narratives for their role and
meaning among Chinese Indonesians in the most recent period of
regime change in Indonesia.
Researching Business and Belief
The data collection took place in the city of Yogyakarta, central

Java. The time frame in which it took place is quite relevant for the
results as the interviews were held in the autumn of 2004, during the
election of Susilo Bambang Yudhoyono as President. It was a time
26 juliette koning
when expressions of Chineseness were starting to be brought more into

the open. However, there was also lingering anxiety about the position
of the new president and vice-president toward Chinese Indonesians.
In particular, some statements by the new vice-president on affirmative
action for indigenous businesses and limiting ethnic Chinese business
led to emotional debates about the possible anti-Chinese position of
the new government ( Jakarta Post, August 20, 2004).
The ethnographic proper consisted of collecting life-cum-business
stories of converted Chinese Indonesians active in the business sector.
What I label life-cum-business stories are life histories with a focus on
the business activities of the interviewee (see also Dahles 2004, 4). In
that sense it is neither a purely business history (as, for instance, no
use of historical archives is made) nor is it a life history in the classi-
cal sense (as several personal circumstances have not been discussed
because of the focus on business and religion). What the life-cum-
business stories here gathered share with the life story genre is a dual
focus on history; a concern with time in the lifeof how it is lived over
phases, careers, cycles, stages; and within time outside the lifeof how
the historical moment plays its role in any lifes shape (Plummer
2001, 39). Whereas Atkinson (1998, 4) prefers to single out the term
life story for those accounts that are almost completely in the words of
the storyteller, my representation is an edited version of the narrative
with large parts of it in the words of the storyteller.
I talked at length and repeatedly, during two months of fieldwork,
with Chinese Indonesian owner-managers of small and medium enter-
prises (mainly retail and services, with some manufacturing companies)
about personal, business, and religious matters. Related to their reli-
gious careers, I tried to find out which religious shifts they had made
and why, with ample attention for conversion stories.
Those interviewed share a common descent from southern China
(Fujian province) and are mostly second or third generation Chinese
born in Indonesia. Before joining the Pentecostal-charismatic move-
ment, many were already Christian (traditional Protestant) while
several others adhered to Buddhism or Confucianism. In order to
contextualize the narratives and conversion stories, I conducted par-
ticipant observation in two of the larger charismatic churches in Yog-
yakarta that were visited each Sunday during the research. This led to
interviews with preachers and staff members on the growth of the con-
gregations, preaching, and profiles of the church members. The two
charismatic movements studied in this research both have a local mem-
bership of some 2,500 people; the preachers are Chinese Indonesian,
as are the majority of the members. Reacting to the question why

it is mainly Chinese Indonesians that go to these meetings, one of
the preachers gives a very revealing answer which shows the ethnic
division in Indonesian society: if the preacher is Chinese, yes then
many Chinese go there. The Chinese Indonesian business people
that participated in the research were either member of one of these
movements or were contacted through snowball methods. All were
interviewed twice on different occasions and the interviews were tape
recorded in Indonesian (and later on translated by the author) with
consent of the interviewees.
The life-cum-business stories have been analyzed from the perspec-
tive that the narratives we tell are in retrospect, after-the-fact interpre-
tations of actions, events, and happenings in our lives as an act of
meaning (cf. Geertz 1995). Bruner has argued that interpreting mean-
ings and meaning-making is only possible in the degree to which we
are able to specify the structure and coherence of the larger contexts
in which specific meanings are created and transmitted (Bruner 1990,
64). Hence, the narratives are analyzed by linking elements of the
stories to each other, i.e. the personal, the business, and the religious
themes in tandem with phenomena shared by the group of people,
such as the ambivalent positions of Chinese Indonesians in the Indo-
nesian nation-state and the events of the late 1990s.
Conversion in Context
The conversion stories of the Chinese Indonesians in this study only

make sense in their proper context, meaning the long history of con-
tested citizenship, the ethnic policies of the various regimes, and the
globalization of charismatic Christianity and what this denotes for
Chinese Indonesians who convert to it.4 I will start with the position
of Chinese Indonesians in Indonesia.5
4
It has to be remarked that the start of the New Order regime (196566) was also
a moment during which many ethnic Chinese (and others) converted to Christianity.
The new government had stipulated that all Indonesians needed proof (on their iden-
tity card) of adhering to a world religion. Confucianism was excluded from the list.
Not adhering to a religion at that time equaled being an atheist and hence a commu-
nist, a persona non grata after the recent killings of thousands of supposedly communist
party members. See Bertrand (2004, 74) and Coppel (2002a).
5
Chinese Indonesians are often divided into totok (China-born Chinese) and perana-
kan (descendents of mixed marriages between totok men and indigenous-Indonesian
28 juliette koning
Although historians disagree on the complexity of the matter, the

Dutch colonizers used a racial segregation of its populace into Euro-
peans, Foreign Orientals, and Natives. In particular, Coppel (2002b)
argues that the idea that the Chinese were designated Foreign Orien-
tals is less settled and emerged later than generally believed.6 Accord-
ing to Winarta, this colonial categorization into Europeans, Foreign
Orientals, or non-indigenous and indigenous, did however create a
segregation that never really disappeared (2008, 57).7 After Inde-
pendence (1945), some prominent Chinese Indonesians established
Baperki (the Consultative Body for Indonesian Citizenship) with the
purpose of asserting equality and citizenship for Chinese Indonesians
throughout Indonesia (Winarta 2008). The Chinese Indonesian com-
munity, however, was divided between those who favored assimila-
tion (by dissociating from Chineseness) and those who argued for
integration (cultural pluralism) (Susanto 2008, 5). The disagreements
between the assimilationists and the integrationists ended with the
banning of Baperki in 1965, after the military take-over by Suharto
whose New Order government (19651998) took a clear assimilationist
standpoint.8
The New Order regime used very effective tools in its attempts to
assimilate the Chinese. At a more psychological level it tried to cre-
ate a national identity with the help of othering; the significant other
being the (non-indigenous) Chinese (Hoon 2006). These identity poli-
tics by the state resulted in an either-or position; Chinese Indonesians
could either be Indonesian or Chinese, but not both; to be completely
Indonesian, the Chinese had to give up all their Chineseness (ibid.,
152). The other tool, based on the idea that the Chinese were not true
women). This distinction is used to claim that the totok are more Chinese than the
peranakan who are supposedly more assimilated. Some scholars point out that this
distinction is no longer relevant and that many peranakan regard Chinese culture and
traditions as important as is supposed for the totok (Wijaya 2002, 1013).
6
For a detailed discussion see Coppel (2002b, 131149).
7
There is much more to be said about the ethnic Chinese during the colonial era
and the Old Order for which I refer to: Reid (1996), Hefner (2001), Coppel (2002a),
Chua (2008).
8
The theme of assimilation is discussed in great detail in the following two chapters
in this volume. Aizawa in the next chapter takes on the issue of assimilation depart-
ing from the perspective of the government (Ministry of Home Affairs) in order to
unravel the relationship between the Chinese Indonesian community and the Indo-
nesian nation-state, while the chapter by Susanto explores the different manners in
which assimilation was incorporated by Chinese Indonesian citizens.
citizens and might turn their back on Indonesia whenever they feel like
it (Freedman 2000), consisted of issuing more than sixty discriminat-
ing regulations (Winarta 2008, 62).
Most of the discriminatory regulations date from the early years of
the New Order when the assimilation policy was aimed at repudiating
Chineseness.9 Details of such regulations can be found in the chapter
by Susanto, but in short it can be said that it was in particular the
presidential instructions from 1967 that limited the scope of Chinese
traditions to the family worship house and required Indonesian ethnic
Chinese to change their Chinese names into Indonesian ones in order
that such citizens shall be assimilated as to avoid any racial exclusive-
ness and discrimination (Winarta 2004, 72). Around the same time
the use of Chinese language and characters in newspapers and shops
was prohibited and a much contested law was installed earlier regard-
ing citizenship, stating that Indonesian ethnic Chinese needed to have
a citizenship certificate, evidence of the change of their Chinese names
into Indonesian and Indonesian citizenship status (ibid.).10 The most
severe blow, however, came from the elimination of Chinese cultural
expressions such as Chinese media, Chinese organizations, and Chi-
nese schools (Suryadinata 2005, 78).
The end of the New Order regime in late May 1998 was preceded
by events that became a very black page in the history of Chinese
Indonesians. Discontent in the country over political and economic
affairs (economic crisis) led to student protests, upheavals in the bigger
cities, and finally culminated in outbursts of violence against Chinese
Indonesians in Jakarta, Medan, and Solo.11 This severe act of aggres-
sion against Chinese Indonesians made a number of Chinese Indo-
nesians leave Indonesia never to return, while others were left in an
even more severe state of insecurity than before (Susanto 2006). As
the personal story of the events and their aftermath by Zhou Fuyuan
(2003, 453) explicates, the number of people who managed to make
9
For an extensive overview of the discriminatory regulations before and after the
New Order regime, see Coppel (2002a), Lindsey (2005), and Winarta (2004, 2008).
10
This certificate is known as Surat Bukti Kewarganegaraaan Republik Indonesia,
SBKRI.
11
See Coppel (2002a) and in particular the special volume of Asian Ethnicity (vol. 4.
no. 3, 2003) discussing the variety of responses of Chinese Indonesians after the fall
of Suharto. A detailed discussion of these events and other ethnic Chinese violence
between 1996 and 1999 is to be found in the work of Purdey (2006).
30 juliette koning
their way to a foreign country was very small: far more had to stay
and resign themselves to the situation. For those who chose to stay,
anxiety was our constant companion; we became hypersensitive . . . we
were living in an environment so susceptible to calamity.
There were only ten days between these outbursts of violence and
the forced resignation of Suharto. The Reform Era that followed was
the start of the revocation of discrimination against Chinese Indone-
sians. Interim president Habibie (May 1998October 1999) approved
the formation of Chinese political parties and installed a Decree to
stop the official use of the terms pribumi (native; sons of the soil ) and
non-pribumi (non-native; immigrantsincluding Chinese Indonesians).
Abdurrahman Wahid (President from October 1999 until July 2001)
abolished the law on the manifestation of Chinese cultural and reli-
gious expression in 2000. Megawati Sukarnoputri (in office from July
2001 until October 2004) issued a Decree that made Chinese New
Year a national holiday. Notwithstanding these revocations, there are
still regulations related to citizenship and population affairs that lead to
discriminatory treatment of Chinese Indonesians (Winarta 2008, 65).
At the same time it is questioned whether there is enough political and
judicial confidence among Chinese Indonesians to reclaim their citi-
zenship and legal rights, as these still belong to a system controlled by
the state, a system that has proven to be unreliable (Lindsey 2005).
Notwithstanding such hesitations, two themes were discussed more
openly than before: the assimilation policy and racialism in Indone-
sian society at large (Herlijanto 2005, 75). This could also be noted
among the interviewees in 2004, and one remarked: we, alumni of
Chinese schools, we are thinking of starting a Chinese organization in
order to correct the wrongs being done to the Chinese, to get rid of
the discrimination against the Chinese. We want the same rights as
other Indonesians.
As pointed out by Herlijanto (2005), there was a double bend in the
position of Chinese Indonesians during the New Order era because the
government was not only the one discriminating against the Chinese
but also considered the best party that could secure their safety. How-
ever, this changed dramatically after May 1998. It is argued that the
May 1998 riots created a crisis of trust among Chinese Indonesians
who now believed neither the military nor the state could offer any
protection (Herlijanto 2005, 69). In fact, this crisis of trust created a
vacuum. Some groups filled the vacuum with initiatives such as form-
ing political parties and pressure groups, while others preferred to be
left alone doing what they have always done quietly and continue
to go about their business and hope and pray that their family will
survive this multiple crisis (Tan 2004, 35). Yet others perhaps went
looking for protection elsewhere, such as religion.
Converting to What?
What characterizes Pentecostal-charismatic Christianity, the religion

that is the focus of this study? As mentioned in the introduction,
Christianity is expanding rapidly in Asia and the greatest Pentecostal-
charismatic expansion in Southeast Asia took place in Indonesia and
the Philippines (Anderson 2005, 7). Pentecostal-charismatic Christi-
anity is characterized by exuberant worship, an emphasis on sub-
jective religious experience and spiritual gifts, claims of supernatural
miracles, signs and wondersincluding a language of experiential
spirituality rather than of theologyand mystical life in the Spirit by
which they daily live out the will of God (Burgess and van der Maas
2002, xvii).
The global attraction is to be found in its egalitarian character: sal-
vation and the gifts of the Spirit are open to all; its emphasis on out-
reach: everyone can evangelize once inspired by the Spirit; its social
organization: the use of multi-media and a focus on strong personal
connections; and its ritual life and spirituality (blurring the boundar-
ies between worship and leisure), which are often in stark contrast
to the daily lives of the converts (Robbins 2004, 1246). Pentecostal-
charismatic Christianity globalizes successfully because it is quick in
addressing local issues and concerns and is de-territorialized (not tied
down to one place) (Robbins 2003, 222). An important component in
these forms of Christianity is conversion. Being born-again means hav-
ing left behind a sinful past. Investing in faith (through Bible study,
evangelizing, paying tithes, activities in charity, church work) sets into
motion a process of continual self-overcoming and results in personal
success. Salvation is now resolutely this-worldly, and the evidence
of a new life has become as much material as spiritual (Corten and
Marshall-Fratani 2001, 7).
32 juliette koning
The roots of Pentecostal-charismatic Christianity in Indonesia can

be found in the arrival of Dutch missionaries in the 1910s1920s, from
which originated the Pentecostal Church of Indonesia (Gereja Pantekosta
di Indonesia, GPdI). It is from the GPdI that one of the larger Pen-
tecostal-charismatic congregations developed, the Indonesian Bethel
Church (Gereja Bethel Indonesia, GBI). These churches are character-
ized by a decentralized organizational structure, meaning they are
autonomous, they exhibit an entertaining worship style, have prag-
matic preaching with room for jokes, stories and testimonies, with
preachers who are former businessmen, professionals or celebrities,
and an emphasis on the miraculous such as divine healing (Wiyono
2005, 31819). This has resulted in large numbers of conversions, in
particular at two moments in time (Robinson 2005, 338). First of all,
in the late 1980s during Indonesias industrialization and urbaniza-
tion boom, when it filled the ideological vacuum that the rapid mod-
ernization processes created. In these years the influx of adherents
mainly came from the middle class, professionals, and business people
(Robinson 2005, 3378). Mega-churches sprung up in the business
centers of the major cities in Indonesia (Wijaya 2002, 259). The sec-
ond moment of growth can be related to the economic crisis and the
fall of Suharto. It was turbulent times, with growing socio-political
domination of Islam, and persecution of Christians and churches, with
Pentecostal churches being the main target in the attacks of the late
1990s and early 2000s (Goh 2005).
Hence, it seems that in times of insecurity, whether out of material-
plenty and ideological emptiness or out of material and emotional
anxiety, these charismatic congregations with Bible teachings about
matters that affect peoples everyday lives and with their modern out-
look and strong leadership (Robinson 2005, 3402) offer a safe haven
where both individual and collective, as well as material and emotional
needs are met.
Life-cum-Business Stories
Most of the stories collected during the research contain an element

of radical personal change, associated with personal and/or business
problems that directed the narrator to convert, to become a born-again
Christian. The telling and retelling of conversion stories by born-again
Christians is related to converting others as well as reconverting the
charismatic self (Coleman 2003, 17). As a result these testimonies

are often the center of the narrative, and a main component of char-
ismatic meetings.
Denzin (1989, 22) introduces the term epiphanies, or turning-
point moments, to argue that most biographical texts are structured by
significant moments in the life of the narrator. The epiphanies might
be helpful in understanding that the intense or decisive moments
in life come to color the rest, as is the case with the religious turn in
the life of the Chinese Indonesians under study here. Epiphanies are
interactional moments and experiences which leave marks on peo-
ples lives . . . in them, personal character is manifested; they are often
moments of crisis (Denzin 1989, 70).
The following three cases are representative of the converted Chi-
nese Indonesians under study and address business, religion, and being
Chinese Indonesian.
Case 1: HarriA Born-Again Christian

Harri was born in 1949 in Salatiga but he grew up in Yogyakarta. Coming
from an entrepreneurial family, he started a small printing business in 1975
that prints invitations and paper bags for shops. From the start his custom-
ers and business relations were other Chinese, because for a Chinese it is
important that if he does not live up to his financial promises he will lose his
name. Taking responsibility is very important. If this trust is broken, then
the relationship ends. This I was taught by my parents. Harri employs six
people and his wife handles the administration. It is a small business, a
peoples business.
He is a third generation Chinese in Indonesia but explains that he does
not adhere to Chinese traditions. He did go to a Chinese primary school but
he cannot understand or speak Mandarin, just enough to conduct business.
He was brought up as a Christian. He and his parents went to a Pentecostal
church but he did not find it inspiring. The Pentecostal church I went to in
my youth was not very appealing to me; I did not get anything from it. After
a while I wondered why keep going? I did not feel any power or strength. So
I stopped going to church; for three years I did not go to church at all. Dur-
ing that time a friend of mine introduced me to something new. This friend
knew my taste for a more dynamic approach. I was introduced to a prayer
service outside church hours, led by a man who was called by God to start
this. The group consisted of about ten people. It was here I found a more
dynamic atmosphere and a closer relationship with God. I was immediately
attracted and I have never stopped going there. From ten people now there
are some 2,5003,000 members and this happened in about fifteen years; I
was a witness that it really started from nothing.
34 juliette koning
He found pleasure in going to church. But I was involved in making

money the wrong way, a very lucrative business. In 1998 when the eco-
nomic crisis was high, I was not really hit very hard. It was only in 1999
that my business began to sore and my monetary situation worsened. It was
the after-effect. I started to worry about income to support my family. I was
in huge problems and also felt I could not tell anyone; the problems were
too private. I started to pray; I prayed and looked back at my life and asked
God how about my children, my business, my life? I prayed and gave all
that was in my heart to God and said: God I want to believe, have faith.
And I was answered. That was a magical moment. It was also the moment
I quit the money-business. He explains: being together with God does not
mean we do not encounter any problems any more, but it is in his hands,
we are under his leadership. He was baptized and became born-again
in 1999.
After I have found God I am much more at ease in my business. Before
finding Jesus I did my business with my head, rational thinking, wanting to be
as perfect as possible. I thought that in that way I would get better business
results. But after many difficult and bad experiences I let Jesus into my heart.
I pray every day before I start work. I give the day in the hands of God and
whatever happens that day is the way God has meant it to be. I have found
peace in that.
In these years of troubles and finding Jesus, Harri also became involved
with the Full Gospel Business Men Fellowship (FGBMF). In all this I felt
growing inside. I very much like the style, which is proactive. I wanted to
help friends to find Jesus as well. But if I mentioned the name of a church the
door closed. By approaching people from a similar background, as business-
men meeting businessmen, it is less threatening to people. In Full Gospel we
as businessmen can share daily life experiences, give testimonies, and it can
all be done immediately. That is the strength. The strength is also that the
members are all businessmen so that the group is homogeneous. Full Gospel
might become very important in the future, as this is one of the few organi-
zations that have a permit to have meetings in public places. There are also
some new regulations going on that are very anti-Christian. Maybe churches
will have to close down because they do not have permits. So the Full Gospel
meetings are very important. The business meetings are also very efficient for
finding new people who are willing to accept Jesus. It is not really easy to
find new souls, but it is the way God has asked me to walk. Strong people
are needed. The mainstream churches are afraid, but they have to accept it;
in fact they might even have to become more charismatic as well. It belongs
to this present time. Globalization fits and needs a more expressive mode. I
think that in this global world doing business can get a kind of safety from
Christianity, from belief. Protection. A true Christian will receive protection
in his business and life. In the business world when not involved with the
Lord, the business can go bad.
Case 2: AriefBalancing Business and Belief

Arief (1950) was born in Solo ( Java), is married and has four children who all
have university degrees; three of them studied abroad. His grandfather and
the grandfather of his wife were born in China (Fujian). In his youth he went
to Chinese schools in Solo. His parents were Buddhists. He explains that he
also became a Buddhist but only because it was required to have a religion.
He explains he did not have any religious feelings until 1997. Thereafter his
life changed. Everything we do in life goes via Jesus and then well be suc-
cessful. Without Jesus within, people cannot change.
Arief started working at the age of forteen. He is now owner and manager
of two interior design stores in Yogya. It was my grandfather who came to
Indonesia without anything. He was able to build a reputation in the soap
business, Sabun Ton. In its prime days there were some fifty employees. During
the Japanese period the factory and business experienced very difficult times
but was able to survive. It was in the 1970s, when the Rinso (Unilever) factory
made its entry, that my grandfathers business went bankrupt. Management-
wise we could not win from big factory management. From these experiences
my parents taught me to be diligent, hard working, and to be strong in my
business endeavours.
In 1975 I moved here and opened a bicycle store. I was in the bicycle
business until 1978. My wife (I married in 1975) would be the one in the
store and I would go to the villages with the spare parts. But this was not
really getting me anywhere; I did not make any real progress. Therefore in
1978 I changed direction and opened a store for building materials such as
paint and cement and I closed the bicycle store. In the early 1980s many
new cement stores were opened and we had trouble making any profits. We
changed the store again and reopened in 1990, being the first building mate-
rials supermarket in Indonesia. In 1994 we opened another store because our
front porch was claimed by the government for enlarging the road. It used to
be possible to park about seven trucks in front of my store, now there is only
space for one car. At the new store it is easier to load and unload materials.
It is eight times bigger than the older store. I did a lot of commercial adver-
tising for the design center and therefore we had a lot of customers, but this
has changed since the crisis.
In 1997 we were hit by the monetary crisis and I had to take over the
store all by myself. Before the crisis a lot of business was done via factories.
Architects would make a showroom and bring in salespeople; we would sell
their things. They were hit by the crisis too and left. Before the crisis I had
the dream to expand the design center concept to various other cities. But
this did not happen. Before I became born-again I was only conducting my
business for me alone, now I am conducting my business for God. It is not
the case that if we follow Jesus we cannot conduct business anymore, but the
focus needs to be changed.
In 1997 Arief experienced the appearance of Jesus and this changed his
life. It was on the 12th of October 1997 that my sins were washed away
in Hotel Phoenix during a baptisms ritual and I was reborn in the Spirit. It
36 juliette koning
was a very difficult time business-wise because of the crisis. Arief explains he
experienced a miracle in his business. Before the crisis I had ordered vari-
ous materials from the factory but the materials were not delivered, while at
the same time the prices were rising because of the crisis. My children said,
papa: do not just trust on your own strength but trust in Jesus. My children
took my wife and me to church and there I started to cry. I felt very embar-
rassed but I could not stop. At that point I was ready to give my worries into
the hands of Jesus and I raised my hands. I was the only one. I was called
to come to the fore and, although I was afraid, we went up and raised our
hands together. There I felt as if electricity went through my fingers, I wanted
to cry out, it was a very nice feeling.
In the meantime his order had not yet arrived and prices were rising con-
stantly. But I stayed very calm and knew Jesus would take care of it. By the
time the prices had risen to the highest point, finally my trucks with materials
arrived. The strangest thing is that notwithstanding the very high price we
had no problem at all in selling them.
One of the major changes in my business is that since I have met Jesus I
pray every morning before opening up the store; with my wife. This strength-
ens my faith and power. There is no clash between the Bible and business but
it is all about priority. Arief is quite critical of the charismatic movements in
Yogya. People go there as an experiment, just to feel fine, to find success,
they pray to have a better life, to get something. Many rich people became
Christians during the crisis: they mainly prayed for money. Business people
often follow Jesus to become successful. To be honest, for business people it
is not easy in Indonesia. For instance in my case: why can I not grow bigger?
Because most of the building projects are in the hands of the government
and, if you want to join these projects you need to give money, and that I
cannot do because of my religion. Join corruption and so on. This is some-
thing that is not possible. But others go along with the corruption anyway. If
we join in corruption this means we have no faith, if we have no faith we are
never going to be saved. I am very much at ease in my business now. That
is my faith. Indonesia needs to be converted.
Case 3: GonoChinese and Christian

Gono was born in 1949 and he is a third generation Chinese. He has a very
successful printing and publishing house. He started from scratch but is now
among the more successful businessmen in Yogyakarta. He is no longer very
active in his business. He leaves much of it to the board of directors and
to one of his sons. Gono spends most of his time on his Christian mission.
I started my business from personal networks. Although the pribumi also
use personal networks for doing business, the family network is far stron-
ger among the Chinese. He explains that there is an opening prayer every
morning in the factory. I am a Christian by birth. I have been going to the
Protestant Church (GKI) and later on to the Pentecostal church. I want to
be a person with God in his heart. Since 1990 I am a full-timer in religious
fields. I was also a person with sins, you know. This company is a mission
company.
I wrote a book that teaches people how to pray. This book is more or less
my mission so that Indonesia will one day have 200 million people who pray,
who want to pray. Indonesia is full of problems, especially since the crisis,
but also because of all kinds of aggressive Islamic movements and terrorist
problems. The political system and the law system in Indonesia are terrible;
Indonesia is the third-largest corrupt country in the world. That is why pray-
ing is so important. Since we cannot join practical politics, we can only follow
the politics of the Lord.
Gono witnessed the growth of the charismatic movement in Yogyakarta.
The charismatic movement in Yogyakarta started in the 1980s. There
was quite some growth and there were quite some cases of healing. But the
charismatic movement has two faces; there is the entertainment: clapping
hands, singing, and testimonies that are blown up. And there is the learn-
ing how to know Jesus. This is teaching about the true mercy of God and
being blessed. Lets start from the fact that many threatening things happen
to Christian people, but also to business people in Indonesia. In the middle
of the threatening experiences Jesus opened their eyes. Business people only
know money; their focus is on making money. But then their stores were
burnt to the ground in Solo and Jakarta (Chinese problems 1998). This and
the crisis opened their eyes. They became aware that there is something
above them that is bigger. They started to put their hope in Jesus. Hence
business people meet many problems and dangers apart from the hatred of
the people. Then they started to see that there is Jesus; that Jesus wants to
help them. They wanted to become closer to God, learn how to pray, they
started to have meetings and get-togethers. After this, the Lord chose them
to spread the word and bring further the movement of God but without
having to leave their businesses. They can sponsor the needs of churches.
The churches also started to focus on businessmen and teach them the word
of God.
If we look at the facts, we can say that in the past the Chinese were intimi-
dated, they were kept low, they were afraid. This is exactly why they went
looking for justice, love, mercy, spirituality, protection, God. And, they began
to be blessed. However, as a result new feelings of jealousy arose. A new gap
arrived. People said, oh the Chinese easily get rich. But today it is time that
the Chinese start to carry out their identity that they start to get involved in
practical politics. It is the time. But we have to be careful, we should not be
too excessive, we should not blow it up too much. With identity I mean cul-
tural values; that we are people who matter. How I see it, the Chinese have
always been under pressure and people under pressure often come with up
with better results.
38 juliette koning
Unravelling the Stories
At the beginning of this chapter I argued that the group under study
is precariously situated in the Indonesian nation-state. This is related
to their long history of contested identities as ethnic Chinese and as
economic actors, and, paradoxically, it is also related to the fall of
Suharto. Although the regime change meant more space for expres-
sions of Chinese identity, it in fact increased their insecurity. In the
following section, based on the cases above, I shall discuss the religious
turn by exploring the interplay between the economic crisis, regime
change, business, and conversion.
Business, Belief, and Belonging

Looking at the cases, the role of business problems in finding Jesus is
quite apparent and these specific problems often co-act as the instiga-
tor of the conversion. All the interviewees refer to the economic crisis
as an important turning point. Being owner-manager of a business
keeps them busy at least six days a week from early morning till late at
night. As the one in charge, they carry the responsibility for the success
of their business. Next to business problems, in all cases, some more
explicit than others, the situation of Chinese Indonesians is mentioned
as well. This is most explicit in the words of Gono, but both Harri
and Arief refer to problems in Indonesian society (corruption, corrupt
government, permit problems for Christian movements). So what does
Pentecostal-charismatic Christianity offer them?
First of all, Pentecostal-charismatic Christianity, with its enjoyable
style of worship and pragmatic-oriented sermons (Wiyono 2005, 318),
offers distraction and immediate solutions to everyday problems, and
it fits this global age, as Harri explained. Those who encountered the
Holy Spirit (often expressed as meeting Jesus face-to-face) divide their
lives into before and after this encounter, and it is the gifts of the
Spirit, aptly referred to by Droogers (2001, 45) as healing in a very
wide sense including non-medical problems, that are cherished and
celebrated. As the interviewees express, electricity went through my
fingers, it was a magical moment. As such, this form of Christianity
is rather unique and offers quite instant relief for all kinds of prob-
lems. At the same time, the meetings are vibrant, with singing and
being in touch with the Lord and, as such, they give new energy as
well. The testimonies and the leaflets and books produced offer ready-
made applicable solutions. More importantly, these solutions are sel-

dom obtained in the mainstream churches. The stories above are good
examples of what is also shared during Sunday masses, or home and
house meetings. The sharing of similar and recognizable family and
business problems offers comfort, a feeling of belonging and safety.
Secondly, apart from the instant sharing, relief, comfort, and joy,
spiritual guidance is found. A common theme in the conversion stories
of these business people is that once having met Jesus a burden is lifted
from their shoulders. The testimonies express that having found God
and being able to trust in his leadership was the kind of spiritual busi-
ness support they in fact were longing for. They narrate about giving
their problems and business worries in the hands of the Lord. It is
expressed as a complete surrender. They are less stressed and more
at ease, and in fact this seems to work to their personal and business
benefit; this religion gives them strength and power. The testimonies
express a wish to be no longer lonely. In fact, receiving the gifts
of the Holy Spirit has the effect of solving an existential problem and
continues to be an important and healing resource in the ongoing
struggle for life (Droogers 2001, 45).
Thirdly, Pentecostal-charismatic Christianity endorses the accumu-
lation of wealth, not found in this manner in other religious tradi-
tions. Whereas the Chinese and Christianity meet each other in the
importance of the family, with familism considered to be the tenet
in ethnic Chinese economic, political, and social life, the messages in
the mainstream Christian churches do not speak to their business spirit
(Wijaya 2002). This is where the charismatic movement proves differ-
ent and where a number of Chinese Indonesians find their answers.
In a newspaper article, Brazier writes that the charismatic churches
prove different from Buddhist or Catholic principles in endorsing the
accumulation of wealth, something that in particular speaks to Chi-
nese Indonesians for whom money is an important form of protec-
tion in an otherwise volatile society (Brazier 2006). In fact, born
again Christians have a right to enjoy prosperity by the grace of God
(Meyer 2006, 11).
Fourthly, being in a network of co-worshippers inspires the Chinese
Indonesian business identity (as shown, often a negative stereotype).
For minority religious groups who, to some extent, are excluded from
mainstream society, access to professional advice and services through
the religious or ethnic network may be a matter of no small conse-
quence (Dodd and Seaman 1998, 73). Sharing norms of the faith
40 juliette koning
creates strong personal ties of trust and trust is a well-known feature

in business conduct, as it might create access to important information
and contacts. Hence, such trust relationships with co-worshippers are
highly appreciated. The interviewees in my study all make extensive
use of personal networks with co-ethnics and co-worshippers because
of expressed shared business norms and religious unity; both related
to being considered outsiders. This co-worship network proves quite
important; in it ethnicity and religion seem to fuse. Aside from pos-
sible new business partners to be found on this axis, the converts find
a further enhancement of their economic identities as business people
in an environment in which it is not stereotyped and even praised (see
former point). As argued by Chua, stereotypes do not disappear so
fast, the equation of Chinese and rich is deeply embedded (Chua
2004, 476).
Fifthly, the May riots and the regime change made it quite clear
that safety and feeling safe, in particular for Chinese Indonesians, is
not a guarantee. The impact of the economic crisis on their business
and personal lives was further deteriorated by the harsh reality of the
regime change, and the attacks on Chinese Indonesians showed that
there is no safe place for Chinese Indonesians in their own country.
Herlijanto (2005, 70) argues that since the state turned out not to be
their main protector, many Chinese Indonesians realized that they
had to take matters into their own hands in order to prevent these
horrors of happening again. If we look at the narratives, it is in par-
ticular Gonos account that we can find this call to take action when
he states it is time for the Chinese to show their identity, to show
that they are people who matter. However, he is not referring to
a protest movement or NGO, but to religion and prayer. As Zhou
Fuyuan recalls, my friends who had always thought of themselves
as Indonesian suddenly faced the fact they were actually regarded as
Chinese, and as such deserved to be alienated. They had to seriously
rethink what this meant and to reorientate themselves (2003, 454). It
seems quite plausible that some Chinese Indonesians found in religion
the reorientation that Zhou Fuyuan refers to. Pentecostal-charismatic
Christianity is a clear example of a religion that is change oriented.
It is firmly believed and expressed that change lies in the strength of
the Holy Spirit and that from this change, other change will follow,
be it personal or social transformational (Ma 2005, 66). This mes-
sage fell in fertile ground among Chinese Indonesians at this crucial
moment in their lives.
Finally, as far as belonging is concerned, Allen (2005, 3) rightly

points out that we know relatively little about how the events of 1998
(the May riots and the regime change) have impacted how Chinese
Indonesians perceive themselves and their situation. She argues that
the fall of the Suharto regime might have opened up the possibility of
new identity formation, and wonders whether new forms and interpre-
tations of Indonesianness can be found. What can be witnessed is the
increased importance of the question of what it means to be Chinese
(in particular so among the younger generations).12 Allen, referring
to an on-line forum that discusses these questions states: the sheer
volume of postings in 1998 is testament to the need felt by Chinese-
Indonesians for an outlet for their fears and aspirations (Allen 2005,
3). With ongoing discrimination and stereotypes, an alternative for
the need to belong seemed at hand beyond the Indonesian nation-
state. Under such severe insecurity pressures, the open arms of the
new charismatic movements were very welcome. The charismatic turn
then represents, in this overtly non-Christian setting, both a turn away
from the nation-state and an embracement of a larger frame of ref-
erence. Global Pentecostal-charismatic Christianity brings a different
sense of belonging. Those who converted seem to prefer to be first and
foremost charismatic Christians who belong to a global community
and as such adopt a view of themselves as borderless world citizens;
as a family within the larger family of God. And more importantly
there is the promise of protection, of both the business and the indi-
vidual. Pentecostal-charismatic Christianity is often found among eth-
nic minorities, where it acts as a revitalization and assertion of moral
standing (Martin 2005, 28).
Rereading the life-cum-business stories of Chinese Indonesians who
convert, the argument that conversion is a passage, a reaction to
intellectual and practical problems (Austin-Broos 2003, 9), seems quite
accurate. In the case of the Chinese Indonesians here under study,
the conversion to the status of a born-again Christian brings with it
the hope of a more trustworthy protection of their families and busi-
nesses, as this is what Global Charismatic Christianity promises to
true believers.
12
The question of what it means to be Chinese Indonesian for various generations
is addressed by Koning and Susanto (2008).
42 juliette koning
Conclusion
The aim of this chapter is to come to a better understanding of why

certain Chinese Indonesian business people in the city of Yogyakarta
were converting to Pentecostal-charismatic Christianity during the
political regime change that occurred in the late 1990s. The underly-
ing question was what new dreams Chinese Indonesians went look-
ing for now that the authoritative regime under which they had been
discriminated against for more than thirty years had fallen apart, and
why some of them chose Pentecostal-charismatic Christianity. By posi-
tioning the narratives in their proper context, i.e. the socio-historical
and socio-political position of Chinese Indonesians in the Indonesian
nation-state and by exploring the phenomenon of growing charismatic
Christianity as a global culture, this chapter paid attention to the inter-
play between the individual and societal dimensions in this process of
conversion.
Ever since colonial times, Chinese Indonesians have been contested
in their ethnic identity and their citizenship. Their position within the
newly built nation-state has been one of exclusion and discrimina-
tion, which is underlined by the various restrictive laws that have been
installed in particular under the New Order. The state has been a
dominant player in this selective creation and manipulation of ethnic
identities (Tan 2001, 952), while forging a national identity out of a
multi-ethnic populace in the process of nation building. That same
state, however, has also been, paradoxically enough, a dominant safety
valve for Chinese Indonesians. The riots and regime change in 1998
altered both situations. On the one hand more room for expressing
Chinese identity was slowly established while on the other hand a
safety-vacuum, or increased insecurity, presented itself. On top of that,
the ongoing economic crisis for many meant a severe attack on their
very existence-cum-identity.
The crisis, and the related business problems that many of the Chi-
nese Indonesians encountered in the late 1990s, led them on the road
to a religion that is quite unique in offering immediate solutions to
urgent business problems, and also offers spiritual guidance in being
an owner-manager of a business, as well as a network of trustworthy
co-worshippers. Above all, this is the only religious congregation that
respects their economic activity: being in business. Furthermore, as
pointed out by one of the preachers, coming to church is a joy, and
gives new energy to those who make long working days. The worldly
character, the gifts of the spirit, and the dynamic and vibrant atmo-
sphere makes Pentecostal-charismatic Christianity very attractive. It
provides them a forum where they can share their insecurities and
their business problems with like-minded people. There is instant care
and relief; the get-togethers with fellow Christians and in most cases
co-ethnics bring both material and immaterial support.
The narratives also reveal a new vigor around issues of Chinese-
ness after the regime change in the late 1990s. The choice for Pente-
costal-charismatic Christianity can be interpreted in terms of a move
away of the nation-state that, although at times an important security
foundation, proved unreliable during that last regime change and in
particular during the severe riots of May 1998. Pentecostal-charismatic
Christianity is a global movement. Because of the linkages between the
local and the global, individual members may feel connected to believ-
ers all over the world, not only sharing the Gospel but also a social
position and common lifestyle. For converted Chinese Indonesians this
connectedness to a global community takes on a special meaning. It
reduces their insecurity and offers an escape from a depressing situation
in which their ethnic and economic status is constantly under pressure,
erasure, or even worse. Their membership of the Charismatic move-
ment, by providing them a global religious identity, enables them to
break away from the oppressive political system of and unfair treat-
ment by their own nation-state, while at the same time they will fall
under the protection of global Christianity.
The religious turn expresses the new hope and dream to be pro-
tected and accepted properly in their entire being, which is as Chinese
Indonesian, as entrepreneur or businessman, and as husband/wife and
father/mother. Global Pentecostal-charismatic Christianity seems to
offer that, in particular to true believers, and this is fate and faith they
have in their own hands.
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4539.
CHAPTER THREE
ASSIMILATION, DIFFERENTIATION,
AND DEPOLITICIZATION:
CHINESE INDONESIANS AND THE MINISTRY
OF HOME AFFAIRS IN SUHARTOS INDONESIA
Nobuhiro Aizawa
Introduction
On August 16, 2005, Ong Tjong Hay, better known as Kristoforus

Sindhunata, quietly passed away in Jakarta. He was buried at the
renowned Kalibata Heros cemetery. A small obituary appeared in
the daily newspaper Kompas on August 18, the day after Indonesia
celebrates Independence Day.1
Sindhunata, a former navy major, was one of the key figures in
the history of the Chinese issue in Indonesia. His most notable post
over the course of his career was his long-term commitment as chair-
man of Lembaga Pengkajian Kesatuan Bangsa (LPKB, Institute for the
Promotion of National Unity), a military-supported political organiza-
tion established in the 1960s during the Sukarno era. LPKB was an
important organization for the so-called assimilation movement. The
assimilation movement consisted of Chinese Indonesian activists who
sought the complete social and political integration of ethnic Chinese
in Indonesian society and considered this best reached by abandoning
all aspects of Chinese cultural life. During the Suharto era, Sindhunata
also chaired the Badan Komunikasi Penhayatan Kesatuan Bangsa (BAKOM
PKB, Communication Body of Organizing National Unity), a group
1
See the article, Obituari Kristoforus Sindhunata Dimakamkan Hari Jumat (Kompas,
August 18, 2005). Harry Tjan Silalahi also wrote an obituary; he was a friend of
Sindhunata at the Law Faculty of the University of Indonesia, and a former colleague
at the Perhimpunan Mahasiswa Katolik Republik Indonesia (PMKRI, Indonesian Catholic
Students Association). Sindhunata was vice-chairperson of PMKRI from 19571959
while Harry Tjan acted as chairperson from 19611962. See also the article: Obitu-
ari Mengantar Kepergian Almarhum Mayor Laut K. Sindhunata (Kompas, August 28, 2005).
Sindhunata is one of the Eminent Indonesian Chinese in Suryadinatas (1981) bio-
graphical sketches.
48 nobuhiro aizawa
that besides promoting assimilation also had the task to bridge the
communication gap between the central government and the Chinese
Indonesian community. Both organizations were government sup-
ported and were mainly concerned with Chinese Indonesian affairs.2
As a moderator of the assimilation policy for Chinese Indonesians,
Sindhunata became well known both among public officials as among
Chinese Indonesian political activists. However, at the beginning of
the twenty-first century, his name has as good as disappeared. The
issue is no longer whether the Chinese need to assimilate or not, but
rather how to restore and redress their rights, and how to acknowledge
their Chinese heritage, a heritage that had come under a lot of pres-
sure during the Suharto period with the banning of Chinese schools
and the public display of Chinese language signboards.3
Since the end of Suhartos presidency (1998), the socio-cultural con-
ditions of Chinese Indonesians have changed quite drastically. One of
the more crucial changes is the China boom which has taken place
in Indonesias major cities. The flow of Chinese goods to Indone-
sian cities is now widespread and visits to and from China have been
increasing. Chinese cultural and social activities are not only publicly
displayed; they are actually welcomed and encouraged. Imlek, the Chi-
nese New Year, and Cap Go Meh, the celebration of the fifteenth night
of the New Year festival, are now publicly celebrated. Festival favor-
ites like the Lion and Dragon Dance draw large crowds at shopping
centers and on the streets. Such celebrations not only attract Chinese
Indonesians but also so-called pribumi.4 It is now an expected part of
the annual holiday landscape to see shopping centers fully decorated
in red ribbons, lanterns, and other Chinese decorations during the
New Years celebration.
Another crucial change is the shift in the terminology used by the
government and mass media to refer to Chinese Indonesians. Tionghoa,
2
LPKB, with backup from the military, was established in March 1963 to coun-
teract the Partai Komunis Indonesia (PKI, Indonesian Communist Party) that supposedly
had connections with the Badan Permusyawaratan Kewarganegaraan Indonesia (BAPERKI,
Body for Indonesian Citizenship). BAKOM PKB was established in 1977 with the
backup of the Ministry of Home Affairs to assist the communication between the
government and the Chinese community.
3
In 2000 under President Abdurrahman Wahid, Presidential Decree No. 6/2000
was issued to annul Presidential Decree No. 14/1967, which had restricted all public
activities of the Chinese related to religion, beliefs, and customs.
4
Pribumi is an Indonesian term for those who are regarded to be indigenous Indo-
nesians. Chinese Indonesians were often referred to as non-pri. Pri and non-pri became
words to differentiate between indigenous Indonesians and Chinese Indonesians.
assimilation, differentiation, and depoliticization 49
which was used in the Sukarno era, has returned and has taken over
the derogative term Cina that was used during Suhartos regime.
Today, many Chinese Indonesian students study Mandarin and China
has become a favorite holiday destination for many Indonesians. A
process of re-sinicizationthat is, a reconnecting with Chinese cul-
tural heritagecan be witnessed. These political and cultural changes
seem to have made the idea of assimilation an outdated concept for
Chinese Indonesians.5
Since 1999, various non-governmental organizations and political
parties have been established to spearhead the issues of Chinese Indo-
nesians. The appeal of these groups to abolish assimilation policies
gained support and several crucial laws were successfully dismissed.
The governments that came to power after the fall of the New Order
regime have started to reconsider the assimilation laws because these
are now considered discriminatory, inhumane, and in violation of
basic human rights.6
In light of this changing position of Chinese Indonesians in
todays Indonesia, it becomes relevant to unravel what the assimila-
tion policies of the past encompassed, and under what circumstances,
by whom, and for what purposes these policies were implemented.
The aim of this chapter, therefore, is to describe what assimilation, as
implemented by the Ministry of Home Affairs, entailed for the Suharto
regime, and to advance our general understanding of the relationship
between the Indonesian state and Chinese Indonesians, a dimension
often ignored.
In order to come to a better understanding of these assimilation
policies, many researchers turned to the political debate, better known
as the assimilation versus integration debate, among Chinese Indone-
sian activists and politicians in the 1950s and 1960s.7 The assimilation-
ists argued that Chinese Indonesians should abandon their Chinese
cultural background and exclusionary lifestylethat is, living sepa-
rately from other Indonesian ethnic groups. The integrationists, how-
ever, were of the opinion that in order to fully participate in national
5
Also Sindhunata visited China in the last days of his life, even though he was one
of the most cautious Chinese Indonesians regarding trips to China.
6
For an overview of discriminatory laws see Jusuf and Srivanto (2001), and Suryo-
menggolo (2003).
7
See Somers (1964), Coppel (1983), Setiono (2002), and Yayasan Tunas Bangsa
(1962).
50 nobuhiro aizawa
politics, Chinese Indonesians did not need to deny their cultural back-
ground. Interestingly enough, this frame of analysis is still surprisingly
influential in the post-Suharto period for studying both the new social
movements of Chinese Indonesians as well as for reviewing the history
of Chinese Indonesians.8
Although this assimilation versus integration framework does provide
a rich analysis of the dynamics within the Chinese Indonesian com-
munity, it does not address the political relationship between Chinese
Indonesians and the Indonesian nation-state. Therefore, to understand
the politics associated with the issue of Indonesias assimilation policy,
we need to go beyond the dynamics within the Chinese Indonesian
intellectual community, and investigate the intricacies of the relation-
ship between the Chinese Indonesian community and the state.
This chapter will describe how and why the now-condemned assim-
ilation policy was originally implemented and became a prominent
feature of the Suharto regime. Although Sindhunata was an important
figure, it is not appropriate to treat what Sindhunata and his assistants
advocated as if it was government policySindhunata, LPKB, and
BAKOM PKB were never in a position to issue a regulation or law.
Needless to say, it is the government that has the final decision on
what regulations and laws are issued. Thus, the need to investigate
the institution that drafted and made the final decisions on issuing
assimilation policies: the Ministry of Home Affairs.
By investigating the policies of the Ministry of Home Affairs (Depar-
temen Dalam Negeri, hereafter referred to as DEPDAGRI), I examine
what assimilation actually meant to the government. It was the
DEPDAGRI that was in charge of issuing assimilation policies under
the Suharto regime. What the DEPDAGRI wanted to accomplish as
far as assimilation was concerned was not what Sindhunata advocat-
edto elevate the status of the Chinese Indonesians in the Indonesian
political scene. DEPDAGRIs goal was rather to depoliticize the Chi-
nese Indonesians under the guise of the same assimilation agenda. It
8
In compiling the political history of Chinese Indonesians, Setiono (2002) pays
extensive attention to the asimilasi vs integrasi debate. Purdey (2003) also uses this frame-
work to analyze the political and social activities of Chinese Indonesians during the
first years of the post-Suharto period. The magazine Sinergi is an important source that
condemned the assimilationists. Suryomenggolos (2003) sharp review of the Suharto
period frames the Suharto era as an era of assimilation.
might be said that Sindhunatas assimilationist agenda was taken over

by the DEPDAGRI.
Sindhunata and LPKB
Sindhunata is best known for chairing LPKB; a political body estab-

lished in 1963 under the auspices of the military during Sukarnos
regime. The rivalry between the LPKB led by Sindhunata and Badan
Permusjawaratan Kewarganegaraan Indonesia (BAPERKI),9 then led by Siaw
Giok Tjang, resulted in one of the most crucial debates in Chinese
Indonesian history. The difference between the groups was based on
their contrasting views on whether Chinese Indonesians should deny
their Chinese cultural heritage and assimilate into Indonesian society;
or whether they should maintain their cultural lifestyle and integrate
as one of Indonesias suku (ethnic group). LPKB was established to
counter BAPERKI, which saw an increase in membership but was
also considered a danger for supposedly supporting the Indonesian
communist party (Partai Komunis Indonesia, PKI). The political rivalry
between the military and PKI severely affected the competition
between the assimilationists and integrationists.10
After the 1965 coup dtat known as the Gerakan 30 September (the
September 30th Movement, G30S), a massive purge of PKI and its
collaborators followed and resulted in the disbanding of BAPERKI.
This breakdown seriously affected integrationist leaders and with the
dissolution of the PKI the competition between the assimilationists and
the integrationists came to an end.
LPKB was thus left as the sole political body representing the inter-
ests of Chinese Indonesians. As chairman of LPKB, Sindhunata raised
the groups political clout and was appointed as one of the keynote
speakers at the 1966 Second Seminar of the Army Staff and Command
College (Seminar Sekolah Staf Komando Angkatan Darat II, SESKOAD II),
which designed policies for the New Order regime. Delivering this
9
BAPERKI was a social organization established in 1954, its membership con-
sisted mostly of Chinese Indonesians. The aim was is to gain equal rights for Chinese
Indonesians. BAPERKI had wide participation from Chinese Indonesian intellectuals,
including members from various political parties. Cf. Setiono (2002, 713732).
10
The debate developed in Star Weekly magazine. Regarding the rivalry between
the LPKB and BAPERKI, see Coppel (1983), Sadayoshi (1995), Setiono (2002).
52 nobuhiro aizawa
keynote speech was a highlight in Sindhunatas political career. He

thereafter became known among politicians, technocrats, and mili-
tary generals as the Ahli Asimilasi (assimilation specialist). His task dur-
ing the Suharto regime was to develop a vision that would support
the new regime in designing assimilation policies regarding Chinese
Indonesians.
Masalah Cina and the Suharto Regime
Suhartos New Order regime put much emphasis on creating national

unity. In line with this goal, the presidium cabinet in April 1967 stated
that the masalah Cina, the Chinese problem, had to be dealt with as a
national issue and needed the commitment and initiative of the state
to solve it. This was only one month after Suharto was inaugurated as
acting president. The word Cina in Indonesian basically meant three
things: first of all, the Peoples Republic of China (PRC); secondly, the
Chinese as an ethnicity both foreign and domestic born; and thirdly,
Chinese as a culture and philosophy.11 The fact that Indonesia had a
deteriorating relationship with the PRC also changed political condi-
tions in the country and created a strong image of PRC as something
to be feared, putting even more stress on the concept Cina.
Domestically, the new government was confronted with a weakened
economy because of the hyperinflation during the last years of the
Sukarno regime. It was decided to mobilize the financial resources of
the entire Chinese community, both foreign citizens and Indonesian
citizens, in order to restore economic development.12 The masalah
Cina hence started to encompass not only social and cultural issues,
but economic and political matters as well. It was decided that these
issues needed the attention from a wide range of institutions. Under the
coordination of the presidium cabinets political section, the Chinese
problem would be tackled with the support of all agencies involved in
political issues such as DEPDAGRI, the Ministry of Foreign Affairs,
the military (including the national police), the intelligence agency, and
the attorney generals office. The presidium cabinet, led by Suharto,
11
See Sukisman (1973). Taiwan was not acknowledged as a state and there-
fore its people were neither registered as Indonesian nor as foreign Chinese but as
stateless.
12
See Aizawa (2006).
appointed each institution to take responsibility of the masalah Cina

related to its own focus.13
This led to the following division. Issues that had to do with the PRC
and foreign-born Chinese in Indonesia became mainly the respon-
sibility of the Armed Forces of the Republic of Indonesia (Angkatan
Bersenjata Republik Indonesia, ABRI), the National Intelligence Coordina-
tion Agency (Badan Koordinasi Intelijen, BAKIN), and the attorney gen-
erals office. Issues regarding Chinese Indonesians were dealt with by
DEPDAGRI.
Institutions and Networks
Ministry of Home Affairs (DEPDAGRI)

On December 6, 1967, DEPDAGRI was appointed as the main insti-
tution for drafting and executing laws and policies regarding Chinese
Indonesians under the newly established Suharto regime.14
While DEPDAGRI swiftly advanced with its role of implementing
Chinese Indonesian policies, Sindhunata and other LPKB members
were gradually excluded from the policy making process during this
crucial period in 1967 when Suharto was framing the legal and insti-
tutional contours of the new political order. Although Sindhunata had
drawn attention with his keynote speech at the SEKOAD II seminar
in August of the previous year, he was gradually pushed aside by those
at the top of the administration. Despite negotiations and efforts by
Sindhunata and his assistants to preserve LPKB and its role in the
new administration, LPKB was dissolved on November 22, 1967. In
the presidential decree ordering the dissolution, Suharto stated that,
In terms of political strategy, LPKB has finished its mission and has
13
This intra-governmental coordination was led by the National Committee of
Drafting the Policies Resolving the Cina Problem, and headed by Brigjen (Brigadir
Jenderal ) Sunarso, personal staff for the President of the Political section.
14
See Presidential Decree No. 240/1967. All the policies on masalah Cina by various
institutions were coordinated by a special staff for Cina affairs, (Staf Chusus Urusan Tjina,
SCUT) later succeeded by the National Coordination Body of Intelligence (Badan
Koordinasi Intelijen Negara, BAKIN) and the Coordination Agency of the Cina Problem
(Badan Koordinasi Masalah Cina, BKMC).
54 nobuhiro aizawa
reached its maximum goal.15 The function and resources of LPKB

were handed over to DEPDAGRI.
DEPDAGRI was one of the most powerful pillars, together with the
military (ABRI), of the Suharto regime for maintaining and securing
domestic political stability. Stretching its bureaucracy networks across
the archipelago, matters relating to the so-called SARA politicssuku
(ethnic), agama (religion), ras (race), and antar golongan (class relations)
were strictly supervised by these two arms of government. It was the
General Directorate of Social and Political Affairs (Direktorat Jenderal
Sosial dan Politik, Dirjen SOSPOL), one of the five general divisions of
DEPDAGRI, that served as the backbone of supervising SARA issues.
The intelligence functions of Dirjen SOSPOL allowed it to monitor
suspected threats to the Indonesian nation which endowed the
agency with such a significant amount of power that people were ter-
rified hearing its name alone. Within DEPDAGRI, it was the powerful
Dirjen SOSPOL that orchestrated the assimilation policies towards
Chinese Indonesians.
Dirjen SOSPOL
The name Dirjen SOSPOL was introduced in 1975 as a result of the
structural reform of DEPDAGRI that same year. From that year on,
Dirjen SOSPOL functioned as the axis of the Suharto regime, watch-
ing over the most crucial and sensitive SARA issues. Before 1975,
various other directorates with ever-changing names managed SARA
issues. Until 1970 SARA matters fell under the Biro Politik, and from
1970 to 1975, it was under the Dirjen Khusus. After a brief interlude of
belonging to the Dirjen Pemerintahan Umum, in 1975 the name Dirjen
SOSPOL was chosen and this lasted until 1999.
From the early days of his career, the most trusted advisers of
Suharto came from the military that were assigned double functions,
dwi-fungsi. This meant that they were not only active as military offi-
cers but also fulfilled roles in politics and the bureaucracy. One of the
practical outcomes of this dwi-fungsi doctrine was the appointment of
military generals into the DEPDAGRI. The most important civilian
15
Keputusan Presiden Republik Indonesia No. 220 tahun, 1967. The efforts of Sindhunata
and the reaction of Ruslan Abdulgani and other high officials are best described in
Coppel (1983).
positions that members of the military took over were that of the Min-
ister of DEPDAGRI and the Chief of Dirjen SOSPOL. These two
posts became the backbone of repressing political opposition and pre-
venting social unrest.
The Minister of DEPDAGRI had great influence in selecting the
governor of each province, while the Chief of Dirjen SOSPOL had the
power to orchestre surveillance activities of civilian officers throughout
the archipelago. With its influence and importance, Dirjen SOSPOL
was truly a powerhouse. Erman Harrirustaman, a brigadier general
in the army, was the first director-general and was appointed by the
Minister of DEPDAGRI, Lieutenant-General Amirmachmud.16 Amir-
machmud had a reputation as The Bulldozer for his tough attitude
towards government oppositiona toughness that was, in practice,
carried out by Dirjen SOSPOL.
Different from other directorate-generals, an important character-
istic of Dirjen SOSPOL was that it not only had an office at DEP-
DAGRI but in every region, and the organization of each regional
office paralleled the organization of the central DEPDAGRI office.
In 1978, provincial, municipal, and county level DEPDAGRI offices
established SOSPOL divisions and each of these housed KESBANG
offices (Direktorat Pembinaan Kesatuan Bangsa, or the Directorate of Pro-
moting National Unity that took charge of the masalah Cina). By 1976,
central and regional offices charged with monitoring and executing the
policies toward Chinese Indonesians had been established throughout
the archipelago. To further complicate the chain of offices involved
in Chinese Indonesian affairs, institution building did not end with
this official SOSPOL network but was supplemented by the establish-
ment of the Communication Body of Organizing National Unity, or
BAKOM PKB.
BAKOM PKB
One of the most famous institutions that Chinese Indonesians had
access to during the Suharto period may have been the BAKOM
PKB. This organization is frequently referred to as the main instru-
ment in the assimilation policy during the Suharto era. BAKOM PKB
16
Before leading the Dirjen SOSPOL, Erman Harirustaman also chaired the Dirjen
Pemerintahan Umum.
56 nobuhiro aizawa
was known as the institution that brought together local Chinese Indo-
nesian leaders who were close to or who wanted to get closer to the
Suharto regime. Initially, to be a BAKOM PKB member was a rare
chance to gain an official channel to each provincial governors office
and to the central office of DEPDAGRI. BAKOM PKB started with
former LPKB leaders and was chaired by Sindhunata.
The establishment of BAKOM PKB took place in 1977. Prior to
this initiative, the mayor of Daerah Khusus Istimewah (DKI, Special Dis-
trict) Jakarta, Ali Sadikin, had already instigated a similar initiative.
In August 1974, Sadikin established Badan Pembina Kesatuan Bangsa
(BPKB, Body of Promoting National Unity), a group whose role it
was to collect information in the Kota area, the old downtown trading
center in the northwestern part of Jakarta densely populated with Chi-
nese Indonesians. Former LPKB members were appointed to open a
channel and facilitate communication between Sadikins office and the
Chinese Indonesian residents of the Kota. There was special interest
in this area because of the anti-Chinese riots of 1967.
Although ten years had passed since the restrictions on Chinese cul-
tural and social practices, there were still many people in this area who
kept their Chinese traditions and spoke Mandarin. Local officers who
were dispatched to conduct administrative work frequently faced com-
munication problems with residents, primarily due to language prob-
lems. In order to better deal with the Chinese Indonesian population,
Sadikin, a former military general and an ambitious mayor, recruited
former LPKB personnel to intervene. Subsequently, DEPDAGRI saw
the value of this action and applied it at the national level as well.
On July 1923, 1977, a preliminary meeting to discuss national
unity and the establishment of BAKOM PKB was convened with
Minister Amirmachmud, two Chinese Indonesian representatives and
one regional officer from each of the twenty-six provinces,17 along with
General Sudomo (Komando Pemulihan Keamanan dan Ketertibaan, Chief of
KOPKAMTIB), Major-General Sunarso (Badan Koordinasi Masalah
Cina, Chief of BKMC), and important staff from other major gov-
ernment branches. According to the proposals from this preliminary
meeting, on August 25, 1977, Amirmachmud ordered all governors to
establish institutions similar to the BAKOM PKB.
17
The twenty-six provinces at that time did not include East Timor.
Created at the behest of DEPDAGRI, KOPKAMTIB, BKMC, and

all the provincial offices on October 28, 1977, BAKOM PKB at first
only consisted of its core members, among them quite a few assimila-
tionists who had been ousted from LPKB in 1969.18 Two months later,
in December 1977, BAKOM PKB was officially acknowledged by the
DEPDAGRI, which meant that DEPDAGRI officials would become
members of the organization.19 BAKOM PKBs status was that of a
semi-governmental organization assisting the activities of the Minister
of DEPDAGRI as well as the governors and Dirjen SOSPOL of each
province. Semi-governmental meant that the appointed members
were not official civil servants, but that the budget was supported by
DEPDAGRI or by the provincial government offices. BAKOM PKBs
mission was to expedite and achieve the unification of the people
through assimilation.
BAKOM PKB basically had two interrelated functions: to create
access for the government to the Chinese Indonesian community and
vice versa.20 As an assisting organization of DEPDAGRI, BAKOM
PKB had to coordinate the implementation of policies and laws. By
appointing Chinese Indonesian leaders from local communities to
BAKOM PKB, DEPDAGRI established a wide-reaching network
in major Chinese Indonesian communities. BAKOM PKB also had
to be a consultative body for the Chinese Indonesian communitya
channel through which Chinese Indonesians could address their needs
and seek solutions for problems that might occur, such as investigating
local rioting against and looting of Chinese Indonesian retail shops.
Whether it was from the Chinese Indonesian side or from the pribumi
side, all information related to causes of social disorder had to be
reported to DEPDAGRI.
Chaired by Sindhunata, BAKOM PKB was a combination of for-
mer LPKB members and the increasingly powerful Dirjen SOSPOL.21
18
Departemen Dalam Negeri Republik Indonesia (1977a). Kawat Menteri Dalam Negeri 600/
KWT/SOSPOL/D2/VIII/1977.
19
The General Director of SOSPOL, Erman Harirustaman, and the Director of
Promoting National Unity, Suwarno, were also appointed as members of BAKOM
PKB.
20
August 26, 1978. Piagam Berdirinya Badan Komunikasi Penghayatan Kesatuan Bangsa
(Charter on the establishing of the Communication Body of Organizing National
Unity).
21
On the establishment of BAKOM PKB, see Departmen Dalam Negeri Republik Indo-
nesia. 1978. Peresmian Badan Komunikasi Penghayatan Kesatuan Bangsa (BAKOM PKB) Ting-
kat Nasional oleh Menteri Dalam Negeri, tgl. 31 Desember 1977. Jakarta: Departemen Dalam
Negeri Republik Indonesia.
58 nobuhiro aizawa
It was within this context that the Suharto regime gained its power
and it was during the Third Development Cabinet that the relevant
institutions were prepared that would implement the new policies for
Chinese Indonesians.22
Assimilation Policies and Programs
After establishing a large network of institutions, such as Dirjen

SOSPOL and Direktorat KESBANG, policies aimed at integrating
Chinese Indonesians into the general Indonesian population were
ready to be enacted.
In 1980, Dirjen SOSPOL conducted a program (Improvement
Program) directing Chinese Indonesian community leaders to survey
and report the assimilation situation and any other masalah Cina in
the sixteen provinces recognized as having a large Chinese Indonesian
population.23 The aim of this survey was to establish a system to record
all kinds of local community problems. The second step was to train
local leaders on how to report to the local Dirjen SOSPOL office.24
Other activities included the training of officers and to check the ratio
of non-pribumi to pribumi in each local district.
Areas with more than twenty percent non-pribumi were designated
sites for the implementation of the assimilation program. The neigh-
borhood heads of these designated districts joined an intensive training
with Dirjen SOSPOL on how to define and report how well Chinese
Indonesians had already assimilated in their neighborhoods, and how
22
The Third Development Cabinet (Kabinet Pembangunan III) under the Suharto
Presidency lasted from 1978 to 1982. Each cabinet had a term of five years.
23
The Neighborhood Improvement Program in the Assimilation process (Program
Peningkatan Peranan RT/RW Dalam Proses Pembauran) was conducted under the initiative
of the Dirjen SOSPOL.
The sixteen designated provinces were: North Sumatra, West Sumatra, Riau, South
Sumatra, DKI Jakarta, West Java, Central Java, DI Jogjagkarta, East Java, West
Kalimantan, South Kalimantan, East Kalimantan, North Sulawesi, South Sulawesi,
Bali, West Nusatengara.
24
According to the preliminary survey conducted by DEPDAGRI, these provinces
retained districts where the ratio of Chinese population was more than forty percent,
and thus were recognized as sites to conduct the assimilation program. (Cf. Laporan
Hasil Pengamatan Lokasi RT/RW Percontohan Dalam Rangka Pelaksanaan Program Peningka-
tan Peranan RT/RW dalam Proses Pembauran. In the circulation letter of the Minister of
DEPDAGRI on SOSPOL No. 148/7622 (1980)).
to collect information on any related local conflicts or complaints.25

These heads at the lowest level of authority became responsible for
collecting information on the lives of Chinese Indonesians and had
to produce statistics. In addition, they were instructed on how to sub-
mit regular reports on the pri/non-pri relationship in their respective
districts. Thus the major goal of this program was the creation of a
national reporting network, to produce information and statistics on
Chinese Indonesian lifestyles, and to see whether the pri/non-pri rela-
tionship in a certain area might become a political issue or not.
The assimilation policies at the neighborhood level were not the only
effort to reach all the way to the neighborhood level. The policies were
also implemented via mass media. TV shows, such as popular dramas
and love stories, were broadcasted emphasizing ethnic harmony. This
was an important strategy in DEPDAGRIs policy to depoliticize the
issue of ethnicity.26 Shows with happy-ethnic-endings were not only
broadcasted on television but also shown in movie theaters and at
schools. This proves the cooperation between DEPDAGRI and the
Department of Education and Culture and the Department of Labor.
Each department had a role in implementing the assimilation policy
supported by the neighborhood-level activities referred to above. By
coordinating these three spheressociety, school/office, and neigh-
borhoodthe Suharto regime tried to make the assimilation policy
more effective.
Effectiveness and Limitations of the Assimilation Programs
It can thus be argued that from the late 1970s onwards a powerful and
massive assimilation system was established and coordinated under
Dirjen SOSPOL and DEPDAGRI. However, it did not produce
25
Departmen Dalam Negeri Republik Indonesia. 1980. Laporan Hasil Pengamatan Lokasi
RT/RW Percontohan Dalam Rangka Pelaksanaan Program Peningkatan Peranan RT/RW dalam
Proses Pembauran. SOSPOL 148/7622.
26
In 1983, a new TV show was broadcasted on national television by TVRI
under the banner: people of different ethnicities living in good harmony. One show
revolved around a love story between a Javanese and Chinese Indonesian who initially
broke up because of their different ethnicities. However, with the help and under-
standing of their communities, they gradually and successfully resolve their problems
and live happily ever after. The message obviously being, no matter the ethnic differ-
ences, people in Indonesia can live in harmony.
60 nobuhiro aizawa
the expected results. There are two reasons why assimilation neither
worked nor caught on.
The first reason relates to a structural problem. The most important
mission of DEPDAGRI was to retain the political and social order.
To do this, the Ministry had the task to successfully carry out gen-
eral elections every five yearsmeaning that DEPDAGRI served the
President so that he would be assured of re-election. Whatever their
other activities were, DEPDAGRIs ultimate goal was to manage and
coordinate the political and social environment in such a way that the
general election would end the right way. As a result, the assimila-
tion activities of DEPDAGRI could not really veer from DEPDAGRIs
core business: maintaining political and social stability for the sake of a
successful election. Assimilation policies should therefore be under-
stood within this context of preventing the Chinese Indonesian issue
to become a destabilizing factor of the political and social order. As
a result, former members of the LPKBlike Sindhunata and those
Chinese Indonesian activists who were close to the Suharto regime
were also confronted with the difference between what they meant and
what DEPDAGRI meant by assimilation. For Sindhunata and other
LPKB members who aimed to enhance the living situation of Chi-
nese Indonesians, assimilation meant guaranteeing safe political access
and preventing social conflicts that would harm Chinese Indonesians.
However, for Dirjen SOSPOL and DEPDAGRI, assimilation was
intended to prevent possible sources of political opposition and, thus,
pave the way for the presidents re-election. Ultimately, DEPDAGRIs
political structure set the boundaries for the assimilation policy.
The second reason the assimilation policy was ineffective and lim-
ited relates to the coordination problem that occurred on December
10, 1977. In November 1977, Minister Amirmachmud authorized the
establishment of BAKOM PKB. At the same time he also, confiden-
tially, released the administrative guidelines for establishing the popu-
lation census. These guidelines were sent to government institutions
and the President.27 The guidelines were significantAmirmachmud
instructed that, in order to distinguish Indonesians of foreign descent,
mainly Chinese, a particular code would be put on their national iden-
tity cards. This would make it possible for anyone to identify whether
27
Departmen Dalam Negeri Repubik Indonesia 1977a. Kawat Menteri Dalam Negeri 600/
KWT/SOSPOL/D2/VIII/1977.
a person was of foreign decent. It was stipulated that when recording

those of foreign descent, the code and the issue date of their Citizenship
Letter (Surat Bukti Kewarganegaraan Republik Indonesia, SBKRI) had to be
noted.28 The SBKRI was a document required for any administrative
need, such as getting a passport or marriage certificate and registering
the birth of a child. Ultimately, to instruct the census to distinguish
between those of foreign descent and those of Indonesian origin was
completely opposed to the original principle of assimilation.
This instruction generated strong opposition from BAKOM PKB
members and other Chinese Indonesian assimilation groups who had
been working with the government. The BAKOM PKB members
were not even officially informed about this new instruction. They
discovered it by accident while doing a survey in West Kalimantan
and learned that the district chief had received instructions that ethnic-
ity should be specially mentioned. For those who wanted to promote
assimilation, like BAKOM PKB, the policy was corrupted from its
very beginning.29
Part of the confusion is to be found in the fact that this instruction
was drafted by the Dirjen Pemerintahan Umum dan Otonomi Daerah (Direc-
torate General Affairs and Regional Autonomy, Dirjen PUOD) and
not by Dirjen SOSPOL. Dirjen PUOD was responsible for producing
the voter registration list for the up-coming 1981 election. This proj-
ect had started in 1977 and, according to its schedule and purpose,
attempted to weed out possible sources of political threat or opposition.
By placing not only those of Chinese descent but also former political
prisoners (Golongan C) in the same category to be noted with a special
code, Dirjen PUOD assured the Minister that they would be better
equipped to control any political opposition toward the regime.
Concluding Remarks
On August 16, 1967, in his first national speech as acting President,

Suharto stated that solving the masalah Cina was an important issue
to tackle and needed priority.
28
Ibid.
29
Interview, Harry Tjan Silalahi, May 11, 2005.
62 nobuhiro aizawa
In order to restore order, we would like to announce the outline of the

policies to solve the masalah Cina. What I would like to express here to
all people is not to get involved in any kind of ethnic discriminatory acts.
A sharp line must be drawn between foreign Chinese and Chinese Indo-
nesians. Chinese Indonesians do have equal rights and responsibilities
no matter where their ancestors came from . . . We would like to request
that Indonesians of Chinese descent achieve integration and assimilation in
society without delay. . . . In this way, physically and mentally, there will be
no barriers between us. Herewith, there will be no difference between
Indonesians of foreign descent and pribumi. On the other hand, Chi-
nese of foreign citizenship will be treated as foreigners and we will stay
mindful of the fact that those foreign Chinese may encourage dangerous
activities such as subversion.30
Although Suharto paid a lot of attention to the masalah Cina while
building his new regime, it is important to note that he did not fol-
low a specific assimilation principle. Whereas the debate between the
assimilationists and the integrationists, in which Chinese Indonesian
intellectuals were entangled, seemed to have been won by the assimi-
lationists after the dissolution of BAPERKI, their voices were gradu-
ally marginalized soon after their victory. The difference between
assimilation and integration had been an important dispute within the
Chinese Indonesian community, but was neither important nor vital
for government policy makers. As long as the concepts of integration
and assimilation made Chinese Indonesians feel connected and loyal
to the Indonesian state, the actual substance of either belief held no
importance for Suharto in building his political regime.
Initially, Suhartos most important objective was to ban all elements
that might become a source of strong political opposition and turmoil.
Therefore, Chinese Indonesians, along with Communists and Mus-
lims, were closely surveyed by the powerful DEPDAGRI as part of the
so-called SARA politics. Perhaps the second most important mission
for Suharto was to make a distinction between Chinese Indonesians
and the Chinese from overseas in order to prevent them from acting
as a fifth column of Beijing that could intervene in Indonesian politics.
The idea was to identify a clear nationality concept and to include
as many foreign Chinese and Chinese Indonesians as possible. As
long as the Chinese Indonesians were Indonesian citizens, the central
30
Cited from the Presidents remarks on Independence Day before the DPR,
August 16, 1967. Translated by the author, emphasis added.
government considered whether they were assimilationists or integra-

tionists a minor issue.
This is why, for example, in his speech, Suharto referred to the
Chinese Indonesian policy as integration and assimilationas far
as Suharto and his government were concerned, it was not either/
or but and that connected the two ideas. In fact, he discarded
the distinction made in the early 1960s between assimilation and
integration.
The attitude of the state towards Chinese Indonesians was set by
DEPDAGRI and its Dirjen SOSPOL at the height of their power in
the late 1970s and 1980s. Even though their power was significant,
they did not achieve what Sindhunata and other former LPKB mem-
bers had expected, which was to improve the political and social posi-
tion of Chinese Indonesians through assimilation. Dirjen SOSPOL
and DEPDAGRI were not interested in the debate between assim-
ilationists and integrationists, for them the major issue was the de-
politicization of Chinese Indonesians and securing transparency of the
Chinese Indonesian community.
As mentioned, DEPDAGRIs ultimate goal was to help the Presi-
dent get re-elected. Therefore, dismantling sources of political opposi-
tion was high on the agenda. Scrutinizing Chinese Indonesian as well
as anti-Chinese Indonesian groups became part of their operation. In
197374, major anti-Chinese Indonesian riots occurred in Bandung
and Jakarta. This alarmed DEPDAGRI and motivated them to take
further action and investigate areas with a high percentage of Chinese
and Chinese Indonesians. It was in this climate that BAKOM PKB
was established in 1977. To secure transparency of what took place
in the Chinese Indonesian community, contacts were established via
BAKOM PKB. DEPDAGRI could also use the census data that iden-
tified Chinese Indonesians in order to collect information on Chinese
Indonesian communities. Even though these actions received severe
opposition from the Chinese Indonesian community, DEPDAGRI
never changed its policy during the Suharto era.
From the point of view of DEPDAGRI, without BAKOM PKB
and other similar groups, and new ways to identify ethnicity, the
Chinese Indonesian community would have been able stay a secret
society. Whether it was a restriction on Chinese language, the estab-
lishment of BAKOM PKB, or the registration of a Chinese code on
identity cards, the ultimate goal was to open up this perceived secret
society. Hence, if studied from that perspective, the regulations by
64 nobuhiro aizawa
DEPDAGRI all seem quite understandable. A series of regulations,

which were seemingly contradictory to the assimilation-integration
framework, were not contradictory at all. What DEPDAGRI was
doing in the late 1970s and early 1980s was, thus, conducting policies
of de-politicization and securing transparency.
This is why there was only limited assimilation during the Suharto
regime. No matter how powerful DEPDAGRI really was, its will to
thoroughly execute assimilation was subordinated to Suhartos priority
of extending his own presidency.
The difference between the assimilation policy Sindhunata had in
mind and the policy Dirjen SOSPOL would promote has been noted.
This difference was the dilemma that Sindhunata faced as leader of
the assimilationists. For him, assimilation was an agenda that would
advance the presence of Chinese Indonesians in Indonesias political
sphere. However, assimilation for DEPDAGRI was a policy to depo-
liticize the Chinese Indonesian population. One of the reasons why the
issue of assimilation is repeatedly brought up but never solved must
therefore be found in the difference between the opinion of state policy
makers and that of the Chinese Indonesian intellectual community.
Bibliography
Aizawa, Nobuhiro. 2006. Defining Masalah Cina in Suhartos Indonesia. PhD diss.,
Kyoto University.
Coppel, Charles. 1983. Indonesian Chinese in Crisis. Kuala Lumpur: Oxford University
Press.
Jusuf, Esther, and Ferdi R. Srivanto. 2001. Rasisme: Dokumentasi Dokumen-dokumen Inter-
nasional Tentang Rasisme. Jakarta: Yayasan Solidaritas Nusa Bangsa.
Purdey, Jemma. 2003. Political Change Reopening the Asimilasi vs Integrasi Debate:
Ethnic Chinese Identity in Post-Suharto Indonesia. Asian Ethnicity 4 (3): 42137.
Sadayoshi, Yasushi 1995. Peranakan kajin no dokaronsou (1960nen)-indonesia sikou
no yukue (The assimilation debate among the Peranakan Chinesethe fate of
pro-Indonesian). Nanpo Bunka 20, 338.
Setiono, Benny G. 2002. Tionghoa dalam Pusaran Politik. Jakarta: Elkasa.
. 2005. Kegagalan Doktrin Asimilasi Indonesia Media Online: http://www.indone-
siamedia.com/2005/10/early/sejarah/kegagalan%20doktrinasi%20asimilasi.htm.
Somers, Mary F. 1964. Peranakan Chinese Politics in Indonesia. PhD diss. Cornell
University.
Sukisman, W.D. 1975. Masalah Cina di Indonesia. Jakarta: Yayasan Penelitian Masalah
Asia.
Suryadinata, Leo. 1981. Eminent Indonesian Chinese: Biographical Sketches. Jakarta: Gunung
Agung.
Suryomenggolo, Jafar. 2003. Hukum sebagai alat Kekuasaan: Politik Asimilasi Orde Baru.
Yogyakarta: Galang Press.
Yayasan Tunas Bangsa. 1962. Lahirnya Konsepsi Asimilasi. Jakarta: Yayasan Tunas
Bangsa.
CHAPTER FOUR
DIVERSITY IN COMPLIANCE:
YOGYAKARTA CHINESE AND THE
NEW ORDER ASSIMILATION POLICY
Andreas Susanto
Introduction
As described in more detail in the previous chapter by Aizawa,

between 1967 and 1997 the New Order government demanded total
assimilation of the Chinese in Indonesia and insisted that the process
of pembauran, assimilation, be accelerated. The government considered
culture to be the main obstacle in this process. The handbook on the
resolution of the Chinese problem in Indonesia states: Guidance
to assimilate in the realization of unity of the nation should be geared
towards the establishment of unity in the value system, and therefore
all forms of cultural affinity based on the country of origin should be
removed.1 Besides the predominant role of the Chinese in the coun-
trys economy, their real or perceived social exclusivity had also con-
stantly been a target of popular criticism. Chinese willingness to merge
into the mainstream Indonesian society was persistently questioned.2
The logic of the assimilation policy required the Chinese to relinquish
their Chineseness and to be absorbed without trace into indigenous
society. Chineseness became, more or less, a forbidden cultural iden-
tity. The official policy of assimilation pressured the Chinese minority
to erase as many traces of Chineseness as possible, e.g. by assuming
Indonesian names or abandoning Chinese customs. This assimilation
had to be realized through government-sponsored social engineer-
ing in the form of legislation that required the Chinese to abandon
their culture and exclusiveness. In 1977, the government established
the Communication Bureau for the Appreciation of National Unity,
1
Badan Koordinasi Inteligensi Nasional (Bakin, Coordinating Body for National Intel-
ligence), 1979.
2
See Jahja (1983, 1991). His books contain a collection of the indigenous percep-
tions toward the Chinese in Indonesia.
66 andreas susanto
which acted as the coordinating body to promote and accelerate the

process of assimilation.3
The formal manifestation of the governments intent to assimilate
the Chinese into the mainstream society took shape in various policies
that were meant to suppress Chinese identity. While there were no
clear sanctions for those who ignored them, the regulations had, in
general, discouraging effects. It is believed that the general response
to such changes has been compliance, albeit with covert reluctance,
although there have been occasional attempts to ignore or maneuver
around the regulations. What is much less known is how precisely
the pressure to assimilate was dealt with and whether the compli-
ance was uniform. Assimilation, as the conventional description
of the management of the Chinese in Indonesia, does not capture the
dynamics of the accommodation processes and the cultural reforma-
tion occurring within the various sectors of the Chinese community.
The dominance of the assimilation discourse has created a rather nar-
row perspective and obscures the various ways people deal with their
social environment.
Whereas Aizawa in the previous chapter explores assimilation
policies by zooming in on the ignored dimension of the relationship
between the state and the Chinese Indonesian community, this chap-
ter investigates the many different reactions to assimilation from Chi-
nese Indonesians in their daily lives. Therefore, rather than speaking
in a uniform manner about all Chinese and assuming that all Chinese
respond to their socio-political situation in an identical manner, we
must develop a more culturally and sociologically realistic understand-
ing of Chinese life in Indonesian society that proceeds on the assump-
tion that culture is not the undivided property of the whole society
(Bourdieu, 1977, 73), but is instead subject to contestation and diver-
gent interpretations.
In order to do justice to possible divergent interpretations and to
contest the idea that the Chinese all reacted in similar ways, this
chapter addresses the responses to assimilation from within one par-
ticular community, the Yogyakarta Chinese. The chapter attempts to
assess how the Yogyakarta Chinese have responded to the pressures to
assimilate during the New Order. It intends to show that the regime
3
Badan Komunikasi Penghayatan Kesatuan Bangsa, Bakom-PKB, was set up in every
province; see the previous chapter by Aizawa in this volume for more details.
diversity in compliance 67
change, which set into motion a policy aimed at repudiating Chinese-

ness created quite different reactions. As such, it does justice to the
role of agency during regime changes and aims to shed a new light on
the manners in which Chinese Indonesians have been active agents in
processes of assimilation.
In the paragraphs to come I will set the scene by addressing the
fieldwork methods, and the assimilation regulations and ethnic Chi-
nese stereotypes. Next I will outline, based on my research, four dif-
ferent assimilation groups within the Chinese community. How these
groups have responded to assimilation will be clarified with examples
from their residential strategies, religious choices, and membership of
Chinese organizations.
Methods and Fieldwork
This chapter is based on my PhD research in Yogyakarta that began

with intensive fieldwork in late 1997 and continued through late 1999
(see Susanto 2008). Since then, I have been involved in activities orga-
nized by Chinese associations and have been able to continue to moni-
tor the development of the Chinese community in Yogyakarta. I met
with many Chinese in the community, including peranakan Chinese as
well as totok Chinese, prominent and ordinary, rich and poor, business
people, professionals, as well as with many indigenous Indonesians. I
attempted to cover the variation in socio-economic status, cultural and
political orientation, age, gender, religion, education, and occupation
amongst the Yogyakarta Chinese. My informants and respondents
were aged primarily between thirty to sixty; the majority were males
of the second and third generations of Chinese migrants, middle and
lower class, high school graduates, and mostly Christian.
Many of my informants in the business community were former
students of Chinese schools. Most of them lived in the heart of the city.
I interviewed approximately thirty informants intensively and many
others less intensively. They were community and business leaders,
board members of Chinese associations, shopkeepers, employees, and
young activists. The indigenous Indonesian I interviewed included
members of parliaments, members of boards of Indonesian chambers
of commerce, lecturers, students, and journalists.
I decided to begin my research in areas known to be old Chinese
settlements, among the peranakan Chinese elite these areas are known
68 andreas susanto
as the Chinese slums. Of particular interest is the close relationship

between Chinese and Javanese residents, and the high rate of intermar-
riage between them. I usually introduced myself as a lecturer at Atma
Jaya Yogyakarta University and explained that I wanted to study the
daily life and history of the Chinese community in Yogyakarta.
I did not tape the conversations, but occasionally took notes. The
interviews were, for the most part, open and unstructured conversa-
tions, rather than structured interviews. Although I attempted to fol-
low a list of questions, the conversations broadened naturally. This
sometimes created difficulties in subsequent summarizing, especially
if the conversation had been long and note-taking inconvenient. I
relied on my memory and kept detailed field notes. Sometimes a brief
encounter in the streets provided me with important information or
broadened my insights. I met most of my informants more than once,
particularly those who showed a willingness to share information and
insights. Most of them were more open in telling their stories in the
second and subsequent meetings.
During the initial nine months of my research, I visited my respon-
dents almost everyday, usually in the morning between 9 a.m. and
1 p.m., and in the evening. I attended meetings and arisan gatherings
regularly, both in the kampung and within the families. Usually, I went
with Marsel, twenty-seven years old, a son of a Hokchia totok and a
Javanese mother, who had grown up there and knew many members
of the local community, both young and old people. I also met with
friends and family members of my informants and, occasionally made
acquaintances in shops or other public places. I made observations in
homes, as well as in public places, including the marketplace, temples,
churches, government offices, restaurants, places of entertainment, etc.
In this way, I was able to observe interactions between many differ-
ent people in a variety of situations. I found funeral parlors to be
very interesting and important, since I could meet and observe many
Chinese in an exclusively Chinese social and cultural situation. The
sense of community was strong there, as it was in some social and
sport events.
Setting the Scene: Regulations and Stereotypes
In his speech to the General Session of Parliament on August 16,

1967, acting President Suharto appealed to Indonesian citizens of
foreign descent to no longer delay their assimilation into the indig-

enous community (Coppel, 2002, 22). The New Order government
was determined to accelerate the assimilation process through regula-
tions.4 These regulations were meant to eradicate the main obstacles
to the process: ethnic exclusivity and cultural affinity to the country
of origin.5
The first step in accelerating the assimilation process was the regula-
tion issued in 1966 that promoted the replacement of Chinese names
with indigenous names. There was an existing law (UU No.4 of 1961)
that called for a changing of names; however neither of these regula-
tions was actively enforced. The Suharto government simplified the
procedure to encourage the Chinese to adopt names that followed the
local customs.
In order to foster complete and homogenous unity of the Indone-
sian nation, in June 1967, the government formulated a regulation on
Chinese religion, beliefs, and customs, which took form in Presidential
Instruction No.14 of 1967. According to this law, the manifestation of
Chinese religion, beliefs, and customs could lead to inappropriate psy-
chological, mental, and moral influences on Indonesian citizens and
hinder the assimilation process. It therefore required regulation. First,
the practice of Chinese religions should be observed only personally
or privately within the family. Second, Chinese religious festivals and
traditional ceremonies could be celebrated only in places of worship
that had been designated for that purpose. In other words, these activi-
ties could not be held in public forums.6
With the emergence of the New Order, Chinese organizations
have been either banned or discouraged. The Chinese could only join
organizations that were generally Indonesian in nature (Suryadinata,
1978). All Chinese language newspapers were closed, except for the
4
On December 9, 1967, the government established the Staf Chusus Urusan Tjina
(SCUT, Special Staff for Chinese Affairs), whose purpose was to assist the government
to formulate policies regarding the Chinese, and to supervise the implementation of
these policies. See Coppel (1983, 131).
5
The most extensive published compilation can be found in the three volumes,
Pedoman Penyelesaian Masalah Cina di Indonesia (Guide to the Solution of the Chinese
Problem in Indonesia), published by the Coordinating Body for National Intelligence
(Bakin, 1979).
6
See Joint Decision of the Minister for Religion, Minister for Internal Affairs, and
the Attorney General of the Republic of Indonesia, No. 67, 111, and 224 of 1980,
translated in Coppel (2002), Appendix I.
70 andreas susanto
government-controlled Harian Indonesia.7 The use of Chinese language

and script in public was discouraged. The government Censor Board
required the Chinese language spoken in Mandarin movies to be
dubbed into Indonesian (Suryadinata, 1978).
Although Chinese language schools were prohibited in July 1966,
the government allowed for the establishment of schools sponsored by
private groups within Chinese communities. The schools called Sekolah
Nasional Projek Chusus (SNPC, Special Project National Schools) fol-
lowed the national curriculum, but Chinese language was added as
an extracurricular subject.8 In Yogyakarta, there was only one SNPC,
Sekolah Bhinneka. In 1975, all SPNC schools in Indonesia were closed
because some of these schools allegedly used Chinese as the language
of instruction. This abolishment marked the complete curtailment of
Chinese cultural influence through formal religious, social, media, and
educational institutions.
Following Tan (1991), a review of the implementation of the regu-
lations indicates that the restrictions were enforced most consistently
on the use of Chinese script in public places, the sale of Chinese lan-
guage publications, and the existence of Chinese language schools.
The implementation of the regulations was not always definitive and
consistent, and often depended on the attitude of the local authorities
towards the Chinese.
Pervading discussions on assimilation are various ethnic stereotypes.
Warnaens study (2002) on the perception of ethnic stereotypes pre-
vailing in Indonesia revealed that Chinese are labeled as stingy and
crafty. They are said to be deeply integrated into their families and
distrustful of outsiders. These stereotypes are commonly expressed in
daily conversations amongst indigenous Yogyanese and give rise to pop-
ular grievances and accusations of exclusiveness and asocial attitudes
of the Chinese. These perceptions leave the Chinese feeling uneasy.
It is noted, for example, that Chinese prefer to live on streets or in
housing estates where the majority of the residents are Chinese, rather
than in the kampungs inhabited primarily by indigenous Indonesians,
or that they rarely participate in social gatherings and communal work
that are organized by the kampung residents. It is common to hear
7
See Instruction of the Cabinet Presidium No. 49 of 1967.
8
For a detailed account of Chinese language schools in Indonesia, see Suryadinata
(1978).
complaints about Chinese who seldom attend kampung meetings and,

instead of participating in the communal neighborhood guard duty at
night (ronda or siskamling), prefer to pay someone else to do it.
Another characteristic that has become the subject of criticism is
their strong sense of community that leads to the formation of exclu-
sive informal groups and social associations of which the membership
are predominantly Chinese. The fact that the majority of Chinese chil-
dren attend private schools that have many Chinese students is seen as
one example of this presumed exclusivity. There is also a perception
amongst indigenous Indonesians that the Chinese consider themselves
to be socially superior to others and, consequently, prefer to restrict
social interaction with them.
Many Javanese thought that Chinese place too much emphasis on
wealth and were not sincere in nurturing friendships. Even when they
were kind to others, they always expected something in return. Three
Javanese women, Mur, Ti, and Eni, spoke to me about their friend-
ships with Chinese girls at a prestigious Catholic school for girls. Their
Chinese friends were generous and always treated them at the school
cafeteria, but then they asked for small favors. While Chinese might
interpret this interaction as reciprocity, it is perceived by the Javanese
adversely as it counters the Javanese ethics of spurning pamrih, that,
ideally, ones actions should be free and not be motivated by self-
interest.9
Few Chinese would concede that there are grounds for these griev-
ances. Many would say that these traits may be true of some Chinese,
but they are not the general rule. It is difficult to determine to what
extent indigenous Indonesians hold these perceptions and grievances,
which may be far from a true description of the Chinese as a group.10
However, the frequencies with which these images and complaints
appear, and the arguments among the Chinese themselves about how
to counteract them, suggest that they are far from unimportant.
An ethnic stereotype may produce an ethnic prejudice, an erro-
neous concept of a particular ethnic group that tends to generalize
characteristic views, e.g., all Chinese. In many indigenous Indone-
sian minds, the Chinese are shop-owners, well-to-do professionals, or
9
Pamrih is explored in Andersons The Idea of Power in Javanese Culture
(1972).
10
See Warnaen (2002) and Jaspar (1982).
72 andreas susanto
big business tycoons. However, in reality, the Chinese community is

highly diverse, and its members respond differently to these indigenous
prejudices and grievances.
Categories of Assimilationists in Yogyakarta
According to Wang Gungwu (1991, 198), the Chinese have never had
a concept of identity, only a concept of Chineseness, i.e., of being
Chinese and of becoming un-Chinese. This implies that one could be
more Chinese or less Chinese, but this does not lead to a concept
of identity.11 It can be said that this is an opinion the Chinese and
indigenous Indonesians share. It is the Chineseness that became the
target of eradication in the assimilation measures, so that the Chinese
in Indonesia would cease to be Chinese.
The Chinese in Yogyakarta come from various socio-economic back-
grounds and they live mainly in the city proper. The majority engages
in small and medium businesses, both as employees and employers.
However, many Yogyakarta Chinese have also become profession-
als, such as lecturers, doctors, lawyers, accountants, architects, and
beauticians. Their sub-ethnic groups include Hokkien, Hakka, Can-
tonese, Hokchia, and Teochiu. Many Chinese are Christians, but
there are Buddhists and Muslims as well. Although the distinction has
been blurred, the peranakan and totok categories still prevail.12 Their
responses to the attempts to erase their Chineseness can be distin-
guished into four categories.
The first group can be referred to as the natural assimilationists. These
Chinese do not perceive assimilation to be a problem. On the con-
trary, they believe that it is natural for Chinese to gradually merge
into the local indigenous society. However, unlike the assimilationist
11
In their study of the Chinese and Chineseness, cultural studies theorists have
criticized the hegemonic formation in discussions of the Chinese. They point out that
the search by overseas Chinese for an authentic Chinese meaning is inherently flawed
and futile. They argue that the notion of Chinese and Chineseness are contingent,
often multiple and evolving (Wong 2003). See also Ang Ien (1994).
12
Peranakan Chinese are considered to be more acculturated and less affiliated
with Chinese culture. Totok are regarded to be pure Chinese because they are not
descendants of inter-marriages between Chinese and indigenous Indonesians, as many
peranakans are. Totok Chinese are considered to retain a strong affiliation with Chi-
nese culture.
group in the 1960s that was driven by political consciousness, these

natural assimilationists are not products of political postures. They do
not bother to offer excuses; they just assimilate silently.13 Most Chi-
nese who belong to this group are middle class. They are engaged
in the non-business sectors, primarily in socio-cultural occupations,
such as journalists, artists, and painters. Among the prominent figures
of this group are the well-known painter, Sidik Martowidjoyo, and
the famous dancer-comedian, Didik Ninik Thowok. They are usually
descendants of mixed-ethnic marriages, but they are somewhat differ-
ent from peranakan Chinese who have developed a distinct culture
of their own. Their way of life and attitudes are more akin to the
local Javanese. Their characteristics have been disassociated from the
negative stereotypes of the Chinese, such as being clannish, economi-
cally motivated and socially exclusive. It is not surprising that many
of them have virtually disappeared into the local indigenous society.
In Javanese, these assimilated Chinese are known as kasno, which is
abbreviated from bekas Cino, former Chinese.
It should be noted, however, that the situation is not always static.
Some young natural assimilationists I met, who are no longer recogniz-
able as Chinese, say that their feelings of being Chinese sometimes
fluctuate. Although they know that they are only half Chinese, they
still feel an affinity to the Chinese community in particular situations.
When the sky in Jakarta, Solo and Kebumen turned red because of
fires, and Chinese people were looted and killed, they too felt the pain.
They were upset when indigenous Indonesians repeatedly blamed the
Chinese as the cause of Indonesias financial crisis. In the taxi, on the
way to her home, Susi listened while the driver vilified the Chinese
as the evil ones who devastated the indigenous economy by conduct-
ing deceitful business. He did not realize that Susi was part Chinese,
because she resembles her mother, a Javanese woman. The taxi driver
did not suspect anything when Susi tried to explain that the Chinese
were not the only ones hoarding food supplies, but that there are also
wealthy Javanese merchants doing the same thing. Nevertheless, the
driver ignored her comment. She was very offended.
13
Hardjono (1970, 44) called this group the silent majority, those who silently
integrate into the indigenous community.
74 andreas susanto
Another story from Yayuk also suggests the possibility of identity

change. She was raised in a mixed-ethnic family who lived in an indig-
enous kampung. Most of her friends in the kampung and at school
were Javanese. She saw herself as a Javanese, even though her father
was totok Chinese. This changed, however, when she started to work
in a Chinese company where most of her colleagues were Chinese.
This Chinese environment gradually influenced her sense of identity,
and today she feels that she has become more Chinese than Java-
nese in her way of thinking, although less so in her attitude. She told
me her Chinese friends in the company also shared her feelings. Nev-
ertheless, Yayuk kept her fathers principle that they belonged to the
local community, and eventually, like all her sisters, she married a
Javanese man, a friend from secondary school.
Members of this group rarely experienced racial discrimination,
largely because they resembled indigenous Indonesians, rather than
Chinese. Interesting stories surface from this issue of physical appear-
ance. Bimbim, who does not appear to be Chinese, went to a govern-
ment office to request a form that was required for Chinese who plan
to get married. The official did not believe that Bimbim was Chinese
and accused him of deception. Fortunately, a senior official who hap-
pened to know Bimbims father well was able to moderate the dispute.
He told Bimbim not to fill out the form because he was accepted as
indigenous, not Chinese.
The second group is made up of opportunistic assimilationists. Many
of them are uneasy with their Chinese label because it may lead to
difficulties. To some extent, being Chinese in Indonesia may be risky,
as Chinese have been convenient targets of harassment, exploitation,
abuse, and violence. Therefore, to avoid any problems arising from
their ethnicity, some Chinese attempt to disguise or camouflage it
in various ways. They adopt Indonesian names, wear batik attire at
formal occasions, and show interest in the assimilation program and
indigenous culture, not because they are genuinely enthusiastic about
it, but merely as a cover. At the extreme end, a number of them
publicly reject their Chineseness. Some members of this group have
converted to Islam.
By doing this, they claim that they are already indigenous and
hope that will no longer be associated with the unfavorable stereotypes
of the Chinese. In Javanese, this second group is called kirno, which
stands for mungkir (deny), Cino (Chinese); an acronym used to criticize
Chinese who deny being Chinese. Most Chinese of this group belong
to the middle-class business community. The motivation behind their

assimilation is to escape from a difficult situation or discrimination
encountered in their businesses. The opportunistic assimilationists
assume that discrimination is not aimed at the Chinese as a whole, but
rather, at those Chinese who refuse to assimilate to dominant norms.
Members of this group, as well as others, have been creative in
adopting Indonesian-sounding names. They usually adopt the names
that correspond to their Chinese surname phonetically or in meaning.
For example, the surname Lim may be transformed into Limanto or
Salim, and the name Oei may change into Wijaya, both names mean-
ing victorious. Often, conversions to Islam are superficial and they
become nominal Muslims, or Islam KTP (identity-card Islam). The
indication on the identity card (kartu tanda penduduk, KTP) of Islam as
their religion may help to deflect any discriminatory treatment. They
often flaunt charity activities by exposing them to media coverage. In
these ways, this groups assimilation appears to be superficial.
In actuality, members of this category have not abandoned Chi-
nese culture or distanced themselves from the Chinese community.
They still celebrate Chinese New Year and perform traditional Chi-
nese marriage and funeral ceremonies. Most of them also belong to a
Chinese funeral society or other predominantly Chinese clubs. Their
denial of being Chinese is purely for the purpose of promoting a favor-
able image in the indigenous community.
The third group can be referred to as the symbolic assimilationists.
For them, being a good Indonesian citizen does not necessarily mean
ceasing to be Chinese. According to this group, assimilation is not
an escape from discrimination, but rather, its effect. They claim that
the process of assimilation is not a natural one, but is forced upon
them by the New Order government; therefore, their responses are
not natural either. In facing the pressures of assimilation, their gen-
eral response has been one of compliance. They accommodate to the
pressures at the least possible cost. Although they acknowledge inter-
ethnic marriage and religious conversion, this group opposes the use
of these social processes for the purposes of assimilation. For the sym-
bolic assimilationists, it is the attributes of culture that matter in the
government-imposed assimilation, not the essence. Their accommoda-
tion is, basically, artificial, behaviorial adjustments without changing
their basic way of life.
According to this group, whose members are primarily upper
middle-class business people and professionals, the demand for total
76 andreas susanto
assimilation is an absurd notion. As one of them asked, How can a

duck become a chicken? They do not believe the Javanese way of life
would conform well to their way of living, of which they are proud.14
Often, there is an implicit pride of being Chinese resonating in their
remarks.15 For instance, they remark on how the Chinese always work
industriously, building to their successes, how they initiate develop-
ment programs in their kampungs, and how Chinese never give up
striving for a better life.16
However, they tend to be indifferent in response to indigenous criti-
cism of the apparent Chinese fervor in making money. Pak Andi, an
outspoken Yogyakarta Chinese whose grandmother is Javanese, said,
We cannot be like them and live on a day-to-day basis, never think-
ing in a long-term perspective. They can do that, perhaps, because
they take this land for granted and they can rely on their fellow coun-
trymen. But we have to struggle to survive. The indigenous people
criticize the Chinese without being aware of the problems we are fac-
ing. Were not crazy about money. Many Chinese are poor. But, we
must earn a living; otherwise we wont be able to live here. Many
Chinese in this group who share Pak Andis view emphasize that they
do not care about what people say, as long as it is not illegal or inflicts
a financial loss on anyone.
The fourth group consists of the cosmopolitan assimilationists. This
group is the result of the process of Indonesianization during the New
Order. They are the younger generation of Chinese who feel totally
Indonesian. Members of this group are no longer able to speak Chi-
nese and no longer practice or observe anything related to Chinese
culture. They live exactly like other young urban Indonesians of their
generation. Their only Chinese traits, if any, may be in their physical
appearance.
14
At this point, it is important to note that mutual negative stereotyping between
Chinese and indigenous people exist. Generally speaking, the Chinese perceive indig-
enous people to be sluggish, less hard-working, and unreliable.
15
They also keep up with the recent events in China. I could see enthusiasm in
their faces when we talked about the remarkable development of China. Apparently,
the fact that China is now growing as a prominent economic power in the world, to
some extent, influences their pride in being Chinese. See Koning and Susanto (2008).
16
A peranakan Chinese remarked that the stereotype of the hard-working Chinese
more appropriately applied to the earliest migrants and totok Chinese. He recalled
that until the early 1970s, most peranakan-owned shops on Malioboro closed between
2 and 5 p.m for an afternoon rest and reopened in the evening.
Since the Chinese traditions are foreign to them, they do not see the
absence of these traditions in their lives as a problem. They were not
raised under circumstances where Chinese or peranakan culture had
an effect on their lives. They know nothing about the assimilationist-
integrationist debates of the 1960s. Therefore, they do not feel any loss
of culture, nor do they have any desire to fight for its survival.
Their lifestyles are derived from the Indonesian modern, cosmo-
politan culture that does not belong to any local, traditional culture.
Their families may no longer celebrate Chinese New Year, but do
observe Christmas and the international New Year. Moreover, like
other Indonesians of the younger generation, they are more akin to
modern Indonesian or Western music and dance. According to some
young Yogyakarta Chinese, very few young Chinese in their social
circle own Mandarin song collections. Most of them are, however,
familiar with Indonesian and Western popular music and idols.17
Although these cosmopolitan assimilationists really consider them-
selves to be one hundred percent Indonesian, their convictions are
challenged repeatedly. In the face of covert discrimination and period-
ical anti-Chinese violence elsewhere, when some have begun to realize
that they are not fully accepted as Indonesians, they begin to distance
themselves from the indigenous majority. It is this group of Chinese
who sometimes experience identity crises. Generally, however, many
of them remain positive about their identities as Indonesians. They are
quite critical and open-minded in understanding the disadvantaged
position of the Chinese in Indonesia, in the sense that they do not see
it as an isolated Chinese problem, but as a result of the poor manage-
ment of the countrys political and economic health. Several educated
Yogyakarta Chinese are aware of the general injustice in Indonesia;
they do not view their situation as purely racial or ethnic based. Very
17
This was the general case until the end of the New Order. In 2002, a shift
occurred when a Taiwanese television series, Meteor Garden, became the most popular
drama serial in Indonesia. The actors, four members of a Taiwanese boy band known
as F4, suddenly rocketed to stardom. Their hairstyles became the fashion among many
urban Indonesian boys. According to Feny, a Yogyakarta Chinese girl, her infatua-
tion with F4 was similar to her previous fascination with other Western boy bands,
so her fondness for them had nothing to do with her ethnicity. F4 was later replaced
by a Korean movie star. Indonesian and American music pop stars continue to rank
among the favorite artists of young people.
78 andreas susanto
few members of this group joined the new Chinese associations in

Yogyakarta that emerged after Reformasi.
It is difficult to determine exactly which of these groups is the larg-
est. However, if we risk simplification by referring to the National
Census of 2000, which indicates that the majority of Yogyakarta Chi-
nese population belongs to the younger generation, it can be assumed
that the cosmopolitan assimilationists and the natural assimilationists
dominate the present community.
In the following sections the positions of these groups on residence,
religion, and Chinese organizations will be explored.
Residential Strategy
It is a fact that most Yogyakarta Chinese live in Pecinan neighbor-

hoods, areas where they have lived for centuries, as required by colonial
law. This zoning system, (wijkenstelsel ) became effective in Yogyakarta
in 1835, and was abolished in 1918. It represented a perfect place
for those who were engaged in commercial trade, so it was reason-
able that they stayed there. Nevertheless, today, this area is no longer
an exclusive Chinese quarter. The Chinese have become a minority
amongst indigenous residents. In this context, it can be said that the
discourse on the ethnicity of the Yogyakarta Chinese residential pat-
tern is largely a matter of misperception and prejudice on both sides.
Although many symbolic assimilationists acknowledge that some
Chinese live apart from the indigenous society, they do not think it is
because of a desire to be exclusive. One symbolic assimilationist said:
The fact that we live in a predominantly Chinese residential area
does not mean that we distance ourselves from indigenous people. We
do have close indigenous friends and occasionally, we visit each other
at our homes. If they do not participate in social activities in the com-
munity, it is simply because they are very preoccupied by their work;
it has nothing to do with ethnic prejudice. They claim it is a common
characteristic of modern urban life.
A number of Chinese business people expressed their reluctance to
live in indigenous kampungs. Their reason is simple: to avoid prob-
lems. They worry that they may be ostracized by their indigenous
neighbors. Another argument is that they want to avoid being caught
in a position where, by refusing to lend money to a neighbor or fail
to join communal activities, they foster an unfavorable reputation. Of
course, this may not happen, but they believe that there is a tendency
to see the Chinese as rich and as potential sources for financial aid. It
is difficult to be socially accepted if one refuses to be generous. In other
words, it is the desire to avoid treatment of the Chinese as a milking
cow that prevents them from living in indigenous kampungs.18 The
advice is usually: If you are not able to adjust to the indigenous com-
munity and participate in the kampung activities, it is better not to live
in their kampung!
The question of whether they must or are willing to make adjust-
ments while they still have other options is, of course, arguable. The
fact is that many Chinese prefer to live amidst their ethnic group,
although not necessarily in a Chinese compound. They realize that,
to some extent, they have different lifestyles from the indigenous com-
munity, and since it is not easy for both sides to accept the others as
they are, they avoid trouble by living within their own group. At this
point, it should be noted that the reasons behind their preference for
any particular location might differ; there is no collective reason. Pref-
erences of Chinese entrepreneurs are based on pragmatic reasons. On
Malioboro, the commercial center, where Chinese are predominant,
the communal activities fit in with the schedule of their businesses. In
fact, there are not many communal programs or social obligations.
Therefore, this is a suitable place for Chinese business people to live
and work. Moreover, many Chinese who lived in the old Chinese
quarter for a long time still believe that it would be more secure to
stay together. As one of them said: Who will help you if there are no
Chinese in your neighborhood?19 Many lower-middle class Chinese
said that they could not afford to buy new houses in other areas.
Today, many Chinese no longer view the old Chinese quarter in
the Malioboro neighborhood as a residential area. It has become
overcrowded. For the well-to-do Chinese and the younger generation
who are in a better economic position, the Chinese quarter was never
a fashionable neighborhood. They prefer to live in modern housing
estates in the nearby suburbs. Generally, the residents in these housing
18
Again, it should be noted that this is not always the case. There are kampungs
where Chinese and indigenous people live harmoniously together.
19
During the struggle for independence (194549) and in late 1965, many Chinese
who lived in indigenous kampungs outside the city took temporary shelter in their
relatives homes in town (Pecinan).
80 andreas susanto
estates in Yogyakarta, both for the middle or upper class, are from
ethnically mixed groups.
Nani, Wahyu, Junaedi, and Gunawan, who live in upper-middle
class housing estates, suggest that neighborhood life in these subdivi-
sions is comfortable, because Chinese and indigenous families who
live there share a similar social standing and background, which cre-
ates mutual understanding. For instance, since most of the home own-
ers are very busy entrepreneurs and professionals, they do not have
much time to socialize. They understand how people are preoccupied
with their activities outside their neighborhood, e.g., in their places of
employment, business or social associations, and sport clubs. There-
fore, they employ security guards to guard their complex and use a
cleaning-service agency to perform the tasks they do not do them-
selves.20 It is public knowledge that the people who live in the upper-
middle class housing estates tend to be individualistic. Their social
interaction is confined to whatever is deemed absolutely necessary.
Communal gathering and activities are minimized in order to spend
more time with their families or to work on their businesses. Sharing
this common lifestyle, the indigenous residents, in general, do not per-
ceive their Chinese neighbors behavior as unusual.
Religious Affinities
The phenomenon of Chinese converting to Christianity is not recent.

The Chinese have established churches since colonial times (Brown
1989, 97119). Nevertheless, it was only in the New Order era that
there was a massive conversion to Christianity among the Chinese.
Some Chinese said that they converted because they were trying to
avoid being tagged with a Chinese identity, i.e. that they were Bud-
dhist or Confucianists. Due to pressures from government regulations,
Confucianism was restricted and discouraged. Many Chinese, espe-
cially peranakan, were reluctant to be associated with this religious
affiliation, which had become a prime target of criticism by indigenous
people (Suryadinata 1978). It was not a matter of what they believed,
but what they perceived was safe. However, if it was only a question of
20
In many upper-middle class housing areas, the housing developers provide secu-
rity and cleaning services.
security, it is unclear why the majority of Chinese choose to convert to

Christianity rather than Islam, which is the religion of the majority of
Indonesians. Would they not be more secure if they were Muslims?
There are various personal reasons why many Chinese preferred
Christianity to Islam.21 The general answer is that religion is a matter
of faith and cannot be forced upon anyone. Some Chinese believe that
Muslims are against the Chinese, quoting evidence of anti-Chinese
violence in Indonesia, which were allegedly incited by Muslim activ-
ists. Because of this, many Chinese perceive Islam to be a militant
religion that promotes fear, rather than peace. They feel that the Mus-
lims dislike Chinese and, therefore, feel threatened. Moreover, some
Chinese think that becoming Muslim means renouncing their Chinese
identity.22
The fact that most Chinese converted to Christianity and not to
Islam is seen as an indication of Chinese reluctance to assimilate into
the indigenous society. They kept their distance by choosing a religion
different from that of the Indonesian majority. In this way, the choice
of being Christian could be interpreted as an attempt to resist the pres-
sure to adopt an indigenous identity.
Many symbolic assimilationists do not believe that becoming Mus-
lim will guarantee them full acceptance by the indigenous major-
ity and promise them greater security. When anti-Chinese violence
occurred on Java, Muslim Chinese became victims as well. Accord-
ing to Haji Kwik, a prominent Muslim Chinese in Yogyakarta, being
Muslim does not automatically help them develop their businesses or
deal with corrupt officials. He said: Money is the most important
thing in solving problems with or getting support from those corrupt
bureaucrats and military men. In business, religion does not matter,
because the broadest business network is not in the hands of Muslim
business people.
The fact that Muslim Chinese have their own association, Perhim-
punan Islam Tionghoa Indonesia (PITI, Association of Indonesian Muslim
Chinese), indicates they have not completely merged into the indig-
enous Muslim society. The Muslim Chinese group in Yogyakarta has
its own arisan, Koran reading club, and newsletters. Some members of
21
To explore the conversion to Christianity from a broader perspective, see Hefner
(1993).
22
For a detailed discussion on this issue, see The (1993, 5599; 1965, 6783); also
Jacobsen (2003).
82 andreas susanto
PITI said that they decided to become Muslims because they believed
that Islam is a good religion, not because it is the religion of the indig-
enous majority. Haji Kwik said: We must not forget that Chinese
in China became Muslim long before Islam came to Indonesia. And
even if we have the same religion as the indigenous people, our way
of thinking and lifestyles are not similar. Some Muslim Chinese also
feel uneasy that the indigenous Muslims often doubt their devotion to
Islam or suspect their motives in becoming Muslims (Legowo, 1986).
In response to this less-than-friendly attitude by indigenous Muslims,
the Chinese Muslims created separate associations. It is very rare that
Muslim Chinese join either Muhammadiyah or Nadhlatul Ulama, the
two main Islamic organizations in the country.
Some Muslim Chinese do acknowledge that there is an advantage
to being Muslim, in the sense that the indigenous people respect them
more or at least refrain from harassing them as they might other Chi-
nese. This is especially true if they have made the haj pilgrimage to
Mecca and become a haji. For example, although the Chinese in Yog-
yakarta are not entitled to own land, Haji Budi, the head of PITI,
received his certificate of land ownership by revealing that he was a
haji.23
It should be noted that many Muslim Chinese, in particular the
opportunistic assimilationists, retain membership in the Chinese asso-
ciations. Despite criticism regarding their conversion, they still belong
to the Chinese community. In fact, some prominent Muslim Chinese,
like Haji Budi, Haji Tun and Haji Kwik, have become middlemen
between the Chinese and the Muslim communities. They attempt to
prove that the negative stereotypes of Chinese are not the general rule.
Haji Kwik is frequently invited to indigenous Muslim gatherings and
through his preaching he emphasizes that the true Muslim should not
be racist or prejudiced against other ethnic groups.
In the Christian Chinese community in Yogyakarta, there are
more Protestants than Catholics. This is interesting since the Protes-
tant churches are less tolerant than the Catholic Church towards Chi-
nese traditional rituals, such as burning incense and praying for their
ancestors.
23
The situation for Muslim Chinese in Indonesia is diametrically opposed to the
situation of Muslim Chinese in Malaysia, where they are considered to be bumiputera,
or pribumi, and have indigenous status. See Lam (2004); Tan (1988).
One possible reason for the preference for Protestantism is that

certain denominations of Protestant churches allow their followers
to establish their own churches. In other words, there is space for
individualism in the Protestant church; hence, there are churches
whose members and boards are predominantly Chinese and congre-
gations who sing their hymns in Chinese. Their Sunday schools teach
Mandarin and sometimes they invite preachers from Hong Kong and
Taiwan.
The Catholic Chinese religious activities are more integrated into
the larger Catholic community because Chinese are a minority in that
church. Generally, the relationship between Chinese and indigenous
Catholics is positive. Religious gatherings are hosted in members
houses, both Chinese and indigenous. Mixed marriage is not uncom-
mon. Several upper-class peranakan Chinese are respected leaders in
the local Catholic community. They are enthusiastic in organizing
social and religious activities, such as pilgrimages to sacred sites and
charity bazaars. Chinese and indigenous Catholics frequently work
together to raise funds for church renovation.
Chinese Organizations
What did the Chinese do after the New Order government denied
them the right to organize groups based on ethnicity? In general, to
safeguard their interests, their social groups were broadened into gen-
eral associations that were open to everyone, not exclusively to Chi-
nese. Their basic principles and goals, as well as membership, were
general and not particularly Chinese. For example, the basic principle
for all social organizations was based on Pancasila, the state ideology,24
and the goal was to advance the welfare of its members. As the defi-
nition of a Chinese association or organization was not clearly stipu-
lated, it was interpreted to mean the obvious use of Chinese names
and themes. Symbolic assimilationists took this interpretation as a
loophole that provided an opportunity for them to organize a group
for Chinese. They had to be careful and clever enough to camouflage
their organizations in such a way that they did not attract suspicion.
24
The Suharto government imposed Pancasila as the sole principle for all social
and political organizations. See Vatikiotis (1993, Chapter 4).
84 andreas susanto
The younger generation of Chinese, the cosmopolitan assimilation-

ists, in Yogyakarta do not think about Chinese associations in the same
terms and with the same spirit as their elders. The desire to have
Chinese associations similar to those in the past is fading. Many have
said that the demands and needs of this era are different. The Chi-
nese themselves have changed. Most middle- and upper-class Chinese
prefer to join modern clubs that are more popular and prestigious,
such as the Rotary and Hash Harriers Clubs. Their interests and rea-
sons for joining or forming an association now are more pragmatic
and functional than ideological. Nevertheless, many opportunistic and
symbolic assimilationists do choose organizations that have many, if
not all, members of Chinese descent. People judge whether an orga-
nization is Chinese according to the majority of its membership and
board. These associations organize a variety of social activities, such
as arisans, sports events, karaoke singing sessions, and tours. Yogya-
karta Chinese avoid forming business organizations, which is reason-
able since they are trying to avoid the stereotype that Chinese form a
united business front against the indigenous entrepreneurs.
According to some leaders of Yogyakarta Chinese associations, it is
not important whether or not their organizations are labeled Chinese.
When they established badminton or basketball clubs, they chose not
to identify the group as Chinese. In fact, they did not want to attract
public attention to Chinese characters. It was more important that
they could join with other Chinese in an activity. The most important
thing was the social gathering.
Times have changed. Affinity based on ethnicity has gradually been
abandoned. Natural assimilationists and cosmopolitan assimilationists
and lower-class Chinese were not involved with exclusive Chinese
associations. Middle-class Chinese join professional clubs because they
are interested in the clubs activities and facilities, not because of pri-
mordial ties. They feel it is natural to socialize with people with whom
they have much in common rather than joining a club only because
there are many Chinese members. Chinese predominance in certain
associations may not be intentional. For example, Rotary clubs in the
Chinese quarter are predominantly Chinese because new members
are selected based on other members recommendations. It is open
to question whether member recommendations are free of ethnic
prejudice.
However, ethnic affinity does remain a primary consideration in
membership selection in certain associations. Although these groups
do not intend to be exclusive, there may be a feeling that it would

be difficult to synchronise people from different cultural backgrounds.
Some have admitted, though, that ethnic prejudice is a factor and that
Chinese and indigenous persons sometimes scarcely trust each other.
Nevertheless, many Chinese associations try to avoid the impression of
being exclusive, so they invite indigenous friends to join their organiza-
tions. It is also common in Indonesia to have government or military
officials in an organization as a pelindung, protector, who serve to dis-
courage any possible interference against the Chinese associations.
The funeral society is probably the most important association that
serves traditional Chinese concerns. It is the last bastion of Chinese
tradition, since the funeral association was the only Chinese organiza-
tion that was allowed to remain in existence when all other groups
were banned. To some extent, they also function as mutual-aid asso-
ciations. Although few Chinese rituals for funerals are maintained,
the existence of the funeral associations themselves is significant for
retaining Chinese traditions. For example, the Chinese usually keep
the dead body for several days before the burial. Generally, the more
prominent the family, the longer the waiting period, allowing more
time to mourners to arrive to attend the funeral. Accessories, such as
incense, funeral clothes of the mourning family, pieces of cloth with
Chinese characters to express condolences from the mourners, and
funeral decorations, are used for the ceremony.
It is usually the Buddhist or Confucian Chinese and totok families
who are more interested in conducting Chinese funeral rituals. The
Christian and Muslim Chinese adopt the funeral ceremonies according
to their religion. If members of a family adhere to different religions or
cultural orientations, they sometimes combine the ceremony with Chi-
nese rituals. Regardless of religion, the choice to perform these rituals
is often dependent on the generation of the mourning family. The
older generation Chinese who were born during the colonial period
retains these practices. In the perspective of the younger generation
who were born in the New Order era, the Chinese funeral rituals are
expensive and inconvenient.
Observing Chinese funerals at the funeral parlor does not necessar-
ily mean that the Chinese are still attached to the old traditions and
community. For many, the reasons are practical, and perhaps more
importantly, to avoid being conspicuous, as it is prohibited by law to
perform their traditional rituals in public.
86 andreas susanto
Chinese culture resurfaces at the Chinese funeral parlor, in the

sense that the rituals are a celebration of being Chinese. The funeral
association places an obituary in the local newspapers to inform the
relatives and friends of the deceased about the service. Most of the
mourners are Chinese and they express their condolences to the fam-
ily by clasping each others hands in front of their chests and shaking
them up and down. After praying and paying respect to the deceased
and the family, they offer a contribution and gather to chat with the
other mourners. Many in attendance know each other, and if not,
are soon introduced. It is a reunion of sorts for many people. The
funeral becomes a venue for renewing acquaintances since they have
little opportunity to meet on a daily basis. Some business persons said
that it is not unusual that business deals may develop from small talk
in the funeral parlor. The Chinese do see the condolence visit as an
important social obligation.
In conclusion, the governments ban on Chinese organizations
did not prevent the Chinese from forming their own associations
by successfully transforming into general associations. As the years
have passed, primordial affinity has been left behind. Most of these
groups no longer have binding affinity with Chineseness; they are
similar to other public associations, with the exception of the funeral
associations.
Concluding Remarks
The regime change that brought to power the New Order regime
(196698) meant the introduction of policies and institutions that
attempted to force the ethnic Chinese in Indonesia to assimilate into
the indigenous society. The New Order regime was in particular
focused on breaking the dominance of the Chinese in the economy,
and continued to practice legal segregation by referring to them as
non-indigenous. The Chinese became convenient targets of harass-
ment, extortion, and discrimination. Periodic anti-Chinese violence in
some form occurred in virtually every outbreak of social and political
unrest during Suhartos thirty-three years in power.
The main objective of this chapter was to understand how the
Chinese community in Yogyakarta responded to the pressures for
socio-cultural assimilation and to the negative stereotypes practiced
throughout the New Order period. There are at least four categories
of assimilationists that were identified: 1) natural assimilationists, those

who believe that it is natural for Chinese to eventually merge into
the local community, and who identify themselves fully as Indone-
sian; 2) opportunistic assimilationists, those who support the process
of assimilation primarily for the sake of avoiding difficulties and con-
ducting their businesses, and assimilate merely on the surface level;
3) symbolic assimilationists, those who actually refuse to abandon their
Chineseness, but have little option other than to comply with the state-
sponsored assimilation pressures, and in order to avoid trouble, super-
ficially accept assimilation; 4) cosmopolitan assimilationists, those who
feel totally Indonesian and see themselves as Indonesian citizens, but
define themselves with modern urban culture, not ethnically.
The majority of Yogyakarta Chinese are natural assimilationists and
cosmopolitan assimilationists. They are less attached to Chinese culture
or do not emphasize their Chineseness, but still perceive themselves as
apart from the indigenous population. By zooming in on residential
choices, religious affinities and membership to Chinese organizations
it was shown that these four categories have responded differently to
the pressures to assimilate.
Hence, it can be concluded that there have been various responses
to the regime change. In their attempt to challenge the pressures to
assimilate, to confront discrimination, and to overcome popular griev-
ances towards them, the Yogyakarta Chinese redefined their role and
place in the Indonesian society. What is most important in these find-
ings is precisely the variety of the responses, the ways in which differ-
ent sectors of the Chinese community constructed, negotiated, and
maintained their security, identities, social lives, economic interests,
civic rights within their local community, and within society at large.
The findings underline the importance of the local context in under-
standing not only the diversity in the accommodations of Yogyakarta
Chinese, but also the diversity among the Chinese themselves. This
chapter has approached the issue of accommodation among Yogya-
karta Chinese, not just as responses to actions from external sources,
i.e. societal and government pressure, but as results of the interplay
between internal and external forces. The particular ways in which
sections of the Chinese community did accommodate to the regime
change is influenced by the changes within the community itself, as
well as shaped and affected by the local socio-political environment in
which they live.
88 andreas susanto
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Chinese Muslim Converts in Malaysia. Paper presented at the annual meeting of
the American Sociological Association, August 14, San Francisco.
Legowo, M. 1986. Pandangan Masyarakat Jawa terhadap Muslim Cina di Kotama-
dya Yogyakarta, Suatu Penelitian Awal tentang Masalah Pembauran. BA thesis,
Gadjah Mada University, Yogyakarta.
Suryadinata, Leo. 1978. The Chinese Minority in Indonesia: Seven Papers. Singapore: Chop-
men.
Susanto, Andreas. 2008. Under the Umbrella of the Sultan. Accommodation of
the Chinese in Yogyakarta during Indonesias New Order. PhD diss., Nijmegen
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Tan Chee Beng. 1988. The Baba of Melaka: Culture and Identity of a Chinese Peranakan
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Pelanduk Publication.
Vatikiotis, Michael. 1993. Indonesian Politics under Suharto: Order, Development and Pressure
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article/viewArticle/1045/966
PART III
JUSTICE AND REPRESENTATION:

THE CHINESE IN THE NETHERLANDS EAST INDIES
CHAPTER FIVE
THE CHINESE CONNECTION:

REWRITING JOURNALISM AND SOCIAL
CATEGORIES IN INDONESIAN HISTORY
Nobuto Yamamoto
The tragedy of the baba (peranakan) group is that they are too Chi-
nese to be indigenous Indonesians, but they are also too assimilated into
Indonesian to be 100% Chinese! (Kwee 1948, 26)
Introduction
In his autobiographical account, Kwee Kek Beng, a prominent pre-war

peranakan journalist, succinctly pointed out the position of the perana-
kan Chinese in Indonesian society. After Indonesia gained indepen-
dence, the political status of the peranakan was rendered increasingly
inconsequential. This represented a stark departure from the vigorous
socio-political role they had played in colonial society. Peranakan jour-
nalists, including Kwee himself, had played a major role in the devel-
opment of the Indies Chinese community as well as the journalistic
community of the Indies. Yet, in postcolonial Indonesia, peranakan
journalists somehow disappeared from the general and official narra-
tive of the nationalist movement. They were forgotten and altogether
left out of history.1
There are however several reasons why peranakan journalists must
be front and center in any discussion of the formation of the Indonesian
nation. Benedict Andersons groundbreaking book, Imagined Communi-
ties, rightly emphasized the role of newspapers and other mass media
as instruments to imagine a superficial community such as the nation,
in addition to promoting the rise and spread of nationalism. In his
argument, Anderson draws attention to journalistic readership, which
forms an unofficial and fluid membership of an imagined national
1
On the disappearance of peranakan literature from Indonesian collective
memory, see Chandra (2006).
94 nobuto yamamoto
community, to the way readers consume newspapers regularlythe

daily best-sellerand in effect are being brought into a sense of
shared time and bounded territory.2
In Indonesian historiography, although it is generally accepted that
newspapers play an important role in cultivating a kind of fellow-
feeling among the readers, the activity of journalists and writers has
been largely neglected. Needless to say, this deserves closer examina-
tion. Even more so because journalists were the transfer point in the
production and circulation of nationalistic discourses, through their
writings, and as such created a quasi-national community in the jour-
nalistic world (doenia pers)3 of the Indies.
Nevertheless, many prominent journalists have been forgotten in
Indonesian national history writing. Not only indigenous journalists
such as Tabrani, Parada Harahap, and Jamaluddin Adinegoro, but
also Chinese journalists such as Th. H. Phoa, Kwee Kek Beng, and
Liem Koen Hian are relatively unknown to the contemporary public
as well as students of Indonesian history.
Such an historical amnesia does not do justice to the Indonesian
nationalist movement of the 1910s and 1920s, which witnessed the
movements leaders being primarily constituted of committed jour-
nalists (Shiraishi 1990). Naturally, Chinese journalists, represented by
the daily Sin Po, were also active in the overseas Chinese national-
istic movement (Williams 1960). More importantly, since Eurasians
and peranakan Chinese had dominated the publishing industry since
the beginning of the twentieth century, indigenous leaders frequently
utilized their channels to communicate their thoughts and messages
(Pramoedya 1985, Adam 1995).
Regime changes dictated the conditions for the formation of a jour-
nalist community and the ways in which peranakan situated them-
selves in a broader colonial setting. Such regimes include political,
legal, technological, informational, and cognitive ones. The 1920s and
1930s experienced a series of regime changes: a liberal political regime
with an ethical policy turned into a conservative and suppressive one;
2
Shiraishi (1990) makes use of Andersons idea of imagined communities with
reading local newspapers and colonial documents in analyzing the development of
Indonesian nationalism in the 1910s and the 1920s. Attention to the development of
Indonesian press revived, too. See for instance, Said (1988), Adam (1995), Kompas
(2002), Maters (2003). As an example of novel reading of Malay literature and peri-
odicals in the Indies, see Siegel (1997).
3
Doenia pers, Sin Jit Po, 4 May 1926, Th. 3, No. 95, L22.
the chinese connection 95
legal authority with a mixture of modern and traditional rule was taken
over by a modern repressive administration; technological innovation
introduced electronic printing machines in the publishing industry;
and an information regime drew wider public attention through the
development of media industry and market activities. These changes
provided the circumstances for the social world of journalism and
nationalism to develop.
This contribution thus attempts to flesh out the unspoken link
between nationalists and journalists in the 1930s and serves two pur-
poses. One is to reveal the instrumental relation between newspapers
and political associations. I illustrate the changing circumstances in
politics and the media that gave rise to commercial journalism. I also
discuss the expansion of the Malay print market in the late 1920s
and the 1930s, with particular emphasis on the peranakan Chinese
who were dominant in newspaper business. The number of press
in Malay increased rapidly in that decade, which roughly coincided
with the time when local politics were cut off from politically oriented
newspapers.
The second purpose is to deconstruct the conventional categoriza-
tion of the Chinese. In general, this categorization is made to draw
broad outlines of the politically diverse Indies Chinese; but it has
become rather imposing in the sense that it obscures precisely the
multiplicity it tried to capture. My research finds the conventional
political categorization of the Chinese oversimplified, misleading, and
quite often even contradictory to the realities of the Chinese. It also
underscores that peranakan communities cannot be understood solely
on the basis of their political orientations or through organized poli-
tics. Class issues and cultural affiliation provided the basis for more
complex peranakan relationship and identification.
The Newspaper Market
When the Dutch introduced the Ethical Policy in 1900, it was believed
then that it was the moral duty of The Netherlands to promote
welfare and combat the causes of perpetual poverty in the Indies.
Efficiency, welfare, and autonomy were the practical goals (Fur-
nivall 1939, 225256). Western education inspired the young gen-
eration of the upper classes with new ideas. This was not limited to
the indigenous Indonesians, but also to Eurasians and the Chinese.
96 nobuto yamamoto
Besides school education, the press industry also developed rapidly

after the 1900s. Now people had a chance to express their grievances
and made these public through local newspapers. Not coincidentally,
as the nationalist movement grew in the 1910s, so did the number of
newspapers also increase.
Perhaps the most significant change in the Malay print market
took place in the mid-1920s. The market expanded rapidly due to
technological innovation in the printing industry with the introduc-
tion of electronic printing machines.4 It opened up a new segment in
the print market that so far had been colored by politically oriented
newspapers.
During this decade, the number of Malay periodicals increased and
their contents diversified. Many urban centers saw the establishment
of local publishers. Figure 1 shows the growth of Malay periodicals in
the Indies. It is based on my own calculation of the number of Malay
periodicals in the Overzicht van de Inlandsche en Maleisch-Chineesche Pers
(Survey of the Indigenous and Malay-Chinese Press, hereafter IPO)
between 1918 to 1929 (Yamamoto 1995).
IPO was a weekly publication issued by Balai Poestaka, the colo-
nial publishing house, established in 1917. It consisted of a forty- to
sixty-page summary throughout the 1920s. From 1921 it circulated
publicly, having previously been a colonial secret mail-report (geheim
mailrapport) to be sent to the Ministry of Colonies in The Netherlands.
IPO, which provided a Dutch summary of major Malay periodicals,
was essential reading for Dutch colonial administrators to familiarize
themselves with Indies affairs, particularly with individuals and asso-
ciations that were considered politically dangerous. These indigenous
periodicals in the 1920s were related to the Sarekat Islam and the Partai
Komunis Indonesia (PKI, Indonesian Communist Party), both of which
were considered major threats to the Indies government. Periodi-
cals such as Neratja (Weltevreden, a radical organ of Sarekat Islam),
Sinar Hindia (Semarang, communist leaning), and Oetoesan Hindia
(Surabaya, radical Sarekat Islam) were among the most important
publications monitored. It should be noted that each political organi-
zation had its own organs and therefore monitoring local newspapers
4
For instance, Sin Jit Po carried an advertisement of an electronic printing machine
shop in 1925. Electrische-Drukkery Kho Tjieng Bie & Co., Pintoe BesarBatavia,
Sin Jit Po, September 26, 1925, Th. 3, No. 68, L33.
Number of Melajoe Periodicals (19251940)

500
450
400
350
300
Number
250
200
150
100
50
0
25
27
28
29
30
31
32
33
34
35
36
37
38
39
40
19
19
19
19
19
19
19
19
19
19
19
19
19
19
19
daily weekly monthly and others
Figure 1. The Malay newspaper market.
was thought to provide indispensable information on the activities of

political organizations. In other words, the translations and summa-
ries in IPO made it easier for the colonial government to grasp the
characteristics of each of the leading periodicals as well as of political
organizations.
The structure and contents of IPO reflect the nature and quality
of the colonial authoritys conception of the Indies. IPO divided the
Indies into two regions, e.g., Java and the Outer Islands. Then fol-
lowed sub-categories such as Malay periodicals and Javanese periodi-
cals, or social and religious associations, under rubrics such as Islamic
and Christian. Because Java was the central focus of the Dutch colo-
nial administration, it goes without saying that the Dutch paid more
attention to Java, and to periodicals in Malay which were accessible
to readers of all racial and ethnic groups in the Indies. Therefore,
the colonial authority was principally concerned with the bottom of
Figure 1, e.g., Malay newspapers in Java; followed by Malay news-
papers in the Outer Islands, Malay magazines in Java, Malay maga-
zines in the Outer Islands, and Sino-Malay periodicals in Java and the
Outer Islands.
98 nobuto yamamoto
The outline of Malay periodicals listed in IPO from 1918 to 1929

reveals three points. First, Java dominated the number of Malay peri-
odicals. The number of newspapers in Java rose from thirty-three in
1918 to forty-six in 1929, while that of magazines from eleven in 1922
to forty-five in 1929. Second, during the 1920s the Outer Islands saw
a relatively faster increase in the number of Malay periodicals than
Java. Third, the number and possibly the variety of Malay maga-
zines grew in the 1920s. The number of newspapers in the Outer
Islands grew from eighteen in 1918 to thirty-three in 1929, whereas
that of magazines fluctuated between eleven in 1922, thirty-eight in
1925, and twenty-two in 1929. With this expansion of the newspaper
market, more specifically the Malay language publications, one could
argue that a journalist community based on linguistic commonality
came into being.
There was yet another fundamental change in the nature of the
press from the mid-1920s onward. From a vehicle of a particular
political association it turned into a capitalist venture and a com-
mercial undertaking. This change reflected the growth of an urban
middle class that was politically conservative and more concerned with
maintaining their living standards. Commercial newspapers covered
general developments of indigenous political movements, but their
emphasis was rather to introduce articles on culture, religion, educa-
tion, and womens emancipation among others, in order to meet a
growing demand from readers. Journalistic writing styles such as the
travel accounts by Parada Harahap became popular among urban
middle class readers.
Parada Harahap, who was hailed as The King of the Java-Press5
in the 1930s, detected the market change. He wrote of the necessity
to produce a new kind of newspaper and of the need to explore a new
type of readership (Harahap 1941). For the new readership, he pointed
out that the urban middle class did not always pay attention to parti-
san politics or was affiliated with party organs; therefore neutral news-
papers would be more appealing to this emerging class. Newspapers
have their market (pasar) and demands (keperloean) (Harahap 1941,
120), he contends, and have already become a commercial product
(pers djadi perdagangan) (Harahap 1924, 120). He was confident that
5
NA, Kol. na 1900, Vb. 20139F2, Mr. 988x/1938.
his newspaper would make money because it catered to the growing

number of the middle-class urbanites.
Harahap published a Malay translation of the state regulations on
the press and added a commentary. In his opinion, legal regulations
were important to maintain social order. Within the colonial legal
structure, he turned the newspaper into a money-generating commod-
ity. Unlike the indigenous press of the 1910s and early 1920s, which
had played a major role in confronting the colonial authorities, the
newspaper business under Parada Harahap conformed to the colonial
order, and in fact took a collaborative approach in relations to the
authority. This approach became the trend in the expansion of the
Malay print market from the 1920s onward.
Sin Jit Po and the Persdelict
It was in this mood of time that the Sino-Malay newspaper Sin Jit Po
was launched in Surabaya in 1923. It was to become a popular news-
paper in the 1920s, but would lose competition to Pewarta Soerabaja in
November 1929. Thereafter, it recommenced publication as Sin Tit
Po. Sin Jit Po had no political organization behind it. But, while the
market started to expand in the 1920s, the colonial authority kept a
close watch on local newspapers and from time to time applied disci-
plinary measures against them. Sin Jit Po was a liberal newspaper that
often challenged colonial authority. I take Sin Jit Po as an example to
present a journalistic practice that I call the culture of citation, but
more specifically to look at the persdelict (press offense) cases reported
in this newspaper. Persdelict cases reveal how the colonial authorities
harassed newspaper reporters and how the newspaper fought back.
In the early days of Sin Jit Po, Th. H. Phoa was editor-in-chief. Oei
Kie Hok and R.M. Bintarti served as editors in Surabaya and Ang
Hoay Lie in Samarinda. The director was Oei Ping Bie; its adminis-
trator, Njoo Khee Tjo. The newspaper had its own printing house, the
N.V. Handelsdrukkerij Sin Jit Po. Its distributing agents extended
from East Java (Madiun, Malang, Wonogiri), Central Java (Yogya-
karta, Bangil ), West Java (Sukabumi, Blitar), Sulawesi (Makasar,
Tulungagung, Gorontalo), Kalimantan (Samarinda), and even to The
Netherlands. It was among the more popular and well-known dailies
in the Sino-Malay language between the 1920s and the 1930s, not
100 nobuto yamamoto
only in Surabaya and East Java, but also in other parts of the Indies
archipelago.
Sin Jit Po, like other newspapers of the time, covered various kinds
of news and articles not only of Surabaya and the Indies, but also
from China and other parts of the world. The basic format of the
newspaper was as follows.
Section 1: Page 1: Kota Soerabaja (City of Surabaya), Feuilleton: Darah
Poetih atawa Kabaran jang tida berwates, ditjeritaken oleh Th. H.
Phoa (White Blood or News without limits, as told by Th. H. Phoa)
Page 2: Hoakiauw dan Tiongkok (Overseas Chinese and China), Kabar
Dagang (Commercial News)
Page 3: Kabar Kawat (Wired News), Hindia dan Laen Negri (Indies and
Other Countries)
Page 4: <Advertisements>
Section 2: Page 1: Kabar Sport (Sports News), Hindia dan Laen Negeri
(Indies and Other Countries)
Page 2: Hoakiauw dan Tiongkok (Overseas Chinese and China)
Pages 34: <Advertisements>
Section 3: Page 1: Hindia dan Laen Negri (Indies and Other Countries),
Tong See Han Yan Gie: Satoe tjerita Tionghoa jang bagoes rame,
banjak digoenaken daja oepaja dan menarik hati, oleh Nemo (Tong
See Han Yan Gie: A good Chinese story, meticulous and charming,
by Nemo)
Page 2: continued from Hindia dan Laen Negri of page 1
Pages 34: <Advertisements>
These sections indicate that Sin Jit Po did not really emphasize one
particular segment because the same subtitles occur in all the sections.
Rather, they reflect a variety of contents, a compilation of news. To
carry such a news variety, it was necessary for newspapers to have
a network of news agents to obtain reports and to cite articles from
one another, as it was not possible to have its own correspondents all
over the Indies and abroad. This culture of citation had a long his-
tory in journalistic practice. The coverage of citations was extensive;
it encompassed Dutch, Chinese, and indigenous newspapers. And the
culture of citation provided the basis for local journalists to imagine a
kind of a journalistic community.
Sin Jit Po featured many political reports and news items alongside
articles on culture. It also carried many commercial advertisements
from Surabaya as well as other major cities in Java. Among the impor-
tant items Sin Jit Po liked to cover were the persdelict (press offense)
cases. The law on persdelict was introduced in the Indies in 1914
and became increasingly severe in 1917 when the colonial publishing
house Balai Poestaka took over the role of press monitoring. As men-
tioned earlier, Balai Poestaka issued the weekly IPO, which was then
used as a manual to discipline journalists, to keep writers and editors
in jail for a period of time or to get them to pay a penalty. Over a
period of twelve years (December 1917 to January 1929), 101 cases
of persdelict were reported in IPO. Seventy-four cases occurred in the
first five years (1918 to 1922), and more than ten leaders of the nation-
alist movement and journalists were incarcerated (Yamamoto 1997a).
Journalists were the main target of the authorities due to their public
remarks in printed matters, newspapers, and magazines alike. In the
middle of the 1920s, due to tightening colonial control over the com-
munist movement, some radical leaders and followers were banned to
The Netherlands or deported to China.
The persdelict was a convenient penal code for offenses of various
forms. In a period of one year alone, from July 1925 to June 1926, Sin
Jit Po carried forty articles related to persdelict cases. One is tempted
to assume that the persdelict was applied solely to political writings,
the coverage of actual politics in the Indies, or to anti-government
articles. This, in fact, is the traditional perception of the persdelict
because researchers tend to overemphasize its politically oppressive
nature.6 However, a closer look reveals that the persdelict could actu-
ally be invoked for a variety of reasons. It could apply to newspaper
articles that seemed to incite racial hatred, to (offensive) writings on
influential families or on religion, to accounts based on hearsay or false
witness, to criticism of other imperialist countries in Asia, or for using
words (terms) unfamiliar to the authority. Additionally, any person,
not only the authority, could invoke a persdelict.
Take for instance the case involving local Chinese authority. The
daily Keng Po was hit with a persdelict because a former Capitan Cina
(a local Chinese official appointed by the colonial authority) in Cire-
bon filed a complaint. As cited in Sin Jit Po, Keng Po had carried an
article accusing the Chinese official of embezzlement. Toean Oeij
Thiam Tjoan gelapken f 3600poenja pakoempoelan Hoa Ho Siang
Kiok (Mr. Oeij Thiam Tjoan embezzled f 3600the money belongs
to the association of Hoa Ho Siang Kiok).7
6
This view is derived from the reading of colonial documents, especially IPO,
rather than from a close reading of local newspapers. For the conventional view of
persdelict, see Maters (2003, 21830).
7
102 nobuto yamamoto
Another case involved an influential Chinese family. Chief editor

of Sin Jit Po, Th. H. Phoa, was tried for a persdelict for a serialized
story that the newspaper published. The story was based on an actual
murder account of a certain man named Oei Siem Nio. Beginning
with the October 25, 1925 issue, Drama di Hotel Oranje kamar No.
33: Pemboenoehan Oei Siem Nio: Ditoetoerken menoeroet kateran-
gan jang sah (Drama in Room No. 33 of Oranje Hotel: The Murder
of Oei Siem Nio: Recounted on the basis of legitimate sources) was
serialized.8 For this story and other related accounts,9 the wife of the
murder victim filed a law suit against Sin Jit Po. Mrs. Oei Siem Nio
and her friends were reported to testify at court.10
The case regarding religion and colonial authority provides yet
another example of the various persdelict cases. In June 1926, Mr.
Wardi, editor of the weekly magazine Soerapati, was questioned for his
phrase in an article, Agama dipake kedok (Religion used as mask),
published on October 3, 1925.11 He was interrogated under persde-
lict because the authority suspected that the phrase conveyed hatred
against the regent of Bandung.
Journalists were well acquainted with the far reaching tentacles of
the Political Intelligence Service (Politieke Inlichtingendienst, PID). The
PID was organized in 1919 and became a powerful tool of the colonial
government to suppress radical and anti-colonial movements. It was
a public agency, with local offices, that employed a large number of
spies and informers. If Balai Poestaka used the monitoring approach
to censor potential subversion, the PID dealt with actual people and
organizations in the field. Interestingly, this supposedly secret force
communicated with and through the press in its dealings. Journal-
ists were often summoned to the local PID station for interrogation.
All journalists knew who the local PID officers were. Sin Jit Po, for
instance, mentioned the receipt of letters from the PID, which dis-
puted its article on the Political Intelligence Service.12 In this way the
readers were made aware of the existence of the PID and it was, to
a great extent, no longer secret. By making its existence so visible,
8
Sin Jit Po, October 25, 1925, Th. 3, No. 90, L23.
9
Sin Jit Po, November 4, 1925, Th. 3, No. 98, also put the announcement of new
story of Hikajat Kakedjian (Story behind Brutality), which investigated the back-
ground of the same murder case.
10
Sin Jit Po, December 8, 1925, Th. 3, No. 127, L12.
11
Sin Jit Po, June 22, 1926, Th. 3, No. 134, L22.
12
Sin Jit Po, November 5, 1925 , Th. 3, No. 99, L12.
the PID might have tried to control the press and other wild voices
in the society.
The persdelict also provided the opportunity for journalists to
establish (and perhaps demonstrate) a sense of journalistic gal-
lantry. Court hearings on persdelict issues gave them a chance to make
fun of the authorities13 not only for injustices, but also for their igno-
rance regarding local language and knowledge. Many persdelict cases
led to prison terms for journalists as most of them refused to pay the
fine, and chose instead to go to jail for a period of weeks, months, even
a year. On the other hand, journalists who chose to pay the fine in
order to avoid imprisonment were often derided by other newspapers
as cowards. Thus in spite of many persdelict cases against it, Sin
Jit Po and its personnel were proud of their tenacious attitude as a
sign of commitment against the colonial governments repression of
the press.
This tradition of anti-authority is also reflected in a number of arti-
cles on Boven Digoel the newspaper featured from early December
1926 onward. The first news of the communist movement (later it
was called communist uprising by the colonial authority) in West
Sumatra was reported in Sin Jit Po on December 3, 1926 with the title
Gerakan kaoem Communist in Sumatra Barat: Keadaan di Djawa
hendak ditjontoh (Communist movement in West Sumatra: Trying
to emulate Java), with a follow-up article Rahasia Communist di
Soematera Barat, terboeka: Pemboenoehan di Kamang (Secrets of
Communist in West Sumatra exposed: The murder in Kamang) on
December 24, 1926.
Unfortunately, the issues of Sin Jit Po from the year of 1927 were
missing from the Cornell University Kroch Library archive, so I could
not follow subsequent articles and news of the period. Yet in the article
Kota Digoel (Digul Town) of April 17, 1928, Sin Jit Po featured
information on the situation in Boven Digoel, which distinguished it
from other newspapers.
The cases of persdelict and related articles inform us about the cul-
ture of citation among newspapers. As I have discussed above, the
liberal-minded Sin Jit Po attracted the readers attention. Its articles
13
Making fun of authorities at courts was a common strategy by nationalistic lead-
ers since the late 1910s. On one of the first cases, see Semaoen (1919) and Yamamoto
(1997b).
104 nobuto yamamoto
attracted other newspapers, too. In order to meet consumers demands

newspapers and periodicals needed to cover a wide range of news and
stories, as well as dig into details not provided by their own correspon-
dents. This tendency gave way to the culture of citation among news-
papers and created a kind of imagined community of journalists.
A Journalist Network: The Case of Liem Koen Hian
The culture of citation worked efficiently thanks to good personal net-

working, and in turn led to a quasi-national journalist community.
One could say that journalist networks reinforced this culture of cita-
tion. Dictated by the nature of their work, it is common for journal-
ists to have collegial networks in different territories, institutions, or
language groups. Personal relations played important roles to establish
working alliances with others. Shared discourses naturally gave rise to
bonds between journalists, but disagreements provided the occasion
for more intensive exchanges among them.
As a matter of fact, journalists established their own association in
October 1925 in Batavia. On October 16, 1925, Sin Jit Po carried
an article on the establishment of the Association of Journalists of
Asia ( Journalistenbond Azie).14 The choice of word Azie was political,
although the association itself had a pure journalistic intention. Azie
implied Asian peoplethe indigenous and the Chineseas opposed
to Western people. It did not matter if one worked for government
organizations or private ones; rather, what mattered was if one was on
the side of Asia or not. Tabrani from Hindia Baroe and Kwee Kek Beng
from Sin Po served as the executive board; W.R. Soepratman from
press bureau Alpena as chairperson; Boen Joe On from Perniagaan as
secretary; and R.S. Parindih from press bureau Berita as treasurer.
The committee was organized by Parada Harahap from Bintang Hin-
dia, Ling Ying Ching and Bee Giauw Tjoen from Sin Po, Khoe Boen
Sioe from Keng Po and Achmad Wongsosewojo from Balai Poestaka.
A week later, the structure was altered slightly.15 Tabrani was appointed
as the chairperson, Kwee Kek Beng as the vice-chairperson, W.R.
Soepratman became the secretary, Bong Jong On the first treasurer,
14
Sin Jit Po, October 16, 1925, Th. 3, No. 82, L22.
15
Sin Jit Po, October 24, 1925, Th 3, No. 89, L31.
and R.S. Parindih the second treasurer. The committee members

were Ling Yin Chen, Parada Harahap, Khoe Woen Sioe, Achmad
Wongsosewojo, and Bee Giauw Tjoen.
All these people were leading journalists of the time. Both indig-
enous and Chinese journalists were included and represented in the
association. In a way the association reflected Furnivalls thesis on the
plural societythat interaction among different races in the colony did
not exist except in the market (Furnivall 1939)because newspapers
relied on the market to develop its business. Thus we find this associa-
tion representing a journalistic community, irrespective of race, in the
1920s. In fact, since the inauguration of Sin Jit Po, R.M. Bintarti had
served as one of its two editors.
To know more about the journalist network in the Indies, let us look
at the career of Liem Koen Hian (18961952).16 I chose Liem Koen
Hian because he was among the most prominent Chinese journalists
of the time and represented a peculiar political position in the Chinese
community of the 1920s and 1930s.
Liem Koen Hian was born in 1896 in Banjarmasin, East Kaliman-
tan. His father, Liem Ke An, was a well-to-do Chinese businessman.
He went to a Dutch primary school in Banjarmasin and later studied
law in Batavia. In Banjarmasin he started working as a writing staff
for the weekly Penimbangan (Banjarmasin) and Tjoen Tjioe, a magazine
from Surabaya. He was also correspondent for the daily De Locomo-
tief (Semarang), and contributed articles in the Soerabaiasche Handelsblad
(Surabaya); both were Dutch language newspapers. In 1917 he pub-
lished a short-lived weekly of his own, Soo Lim Poo, in Surabaya. After
more than a year of doing business in Aceh, between December 1918
and 1921 he found himself in Padang as the editor-in-chief for Sinar
Sumatra, which was considered a radical Sino-Malay newspaper like
Sin Po in Batavia. In 1921 he became an editor for Pewarta Soerabaia, a
weekly owned by The Kian Seng, and then from May 1925 until 1929
he was an editor for Soeara Poeblik (Surabaya). In 1929, when Sin Jit Po
went bankrupt and Sin Tit Po was established, he became the editor-
in-chief of the new daily. In Surabaya he collaborated with moder-
ate Indonesian nationalists, such as leaders of the Indonesian Peoples
Party (Partai Bangsa Indonesia, PBI) headed by Dr. Sutomo.
16
The description of Liem Koen Hians career mainly relies on Tjamboek (2004)
and Suryadinata (1993, 5684).
106 nobuto yamamoto
In 1932, Liem Koen Hian established the Partai Tionghoa Indonesia

(Indonesian Chinese Party, PTI), and was elected its chairperson. Sin
Tit Po became its semi-official organ. In early 1933 he quit Sin Tit Po
after a quarrel with the owner. He then joined Kwee Hing Tjiat at
the daily Mata Hari owned by Oei Tiong Hams son, and became a
Surabaya correspondent. The Oei Tiong Ham Concern was known
to have a close link with the Chung Hwa Hui (Chinese Association,
CHH), which in the conventional categorization of Indies Chinese
differed politically from Liems PTI.17 Then he went to Batavia to
attend the Law School (Rechtshoogeschool ), and while there directed Tim-
boel magazine with Sanusi Pane, a prominent indigenous literati. He
also assisted Siang Po, a newspaper owned by Phoa Liong Gie, a lawyer
who left Chung Hwa Hui in 1934. In Batavia he established connec-
tions with radical indigenous nationalists such as Muh. Yamin, Sanusi
Pane, and Amir Syarifuddin. These nationalists published a newspa-
per, Kebangoenan, which was printed by the Siang Po Printing Press and
shared news items and articles with the Siang Po daily. In 1936 Liem
became the chief editor of Panorama magazine, whose editorial board
included Ahmad Subarjo, Amir Syarifuddin, and Muh. Yamin, Phoa
Liong Gie, and Sanusi Pane.
In April 1937 Liem left Siang Po and became the editor-in-chief
of Kong Hoa Po, which was also published by the Siang Po Printing
Press. In November 1938 he left the Kong Hoa Po at the invitation of
Dr. Tjoa Sik Ien, the new president of the PTI Surabaya branch and
the proprietor of Sin Tit Po. In January 1939 he returned to serve as
editor-in-chief for Sin Tit Po, but soon was replaced by Tan Ling Djie
to continue his study of law in Batavia.
Liem Koen Hians personal networks present to us several interest-
ing points. First, he rarely stayed in one place while pursuing his jour-
nalistic career. He started his career in Banjarmasin, and then moved
to Surabaya, Padang, Semarang, and Batavia.
Second, over time Liem worked as editor-in-chief for several news-
papers. He edited Sinar Sumatra, Soera Publiek, Sin Jit Po, Sin Tit Po,
Mata Hari, Siang Po, Panorama, and Kong Hoa Po. These included both
Chinese and indigenous-owned newspapers and magazines.
17
For the classic categorization of peranakan political orientations, see Suryadinata
(1981).
Third, Liem Koen Hian worked with journalists of different political

orientations. Journalists like The Kian Seng, Hauw Tek Kong, Kwee
Hing Tjiat, and Phoa Liong Gie did not share Liems own politi-
cal beliefs and were affiliated with different organizations. Yet, net-
worked Chinese journalists appeared to have some kind of a system
of mutation among them. For example, Oei Kie Hok retired from
his editorial position at Sin Jit Po, and Tan Kien Lian (ex-editor of
Sin Bin, Bandung) and Lie Sin Thian (ex-chief editor of Tjhoen Tjhioe
and Pelita, Surabaya) replaced him.18 A few days later, Liem Djit Seng
and Oei Kie Hok (who left Sin Jit Po) took up the position of editor at
Warna Warta (Semarang). In this manner, prominent journalists trav-
eled around major newspapers and cities in the Indies, as Liem Koen
Hians career clearly shows. The mutation of editors worked because
journalism was supposed to work on a regular basis, and the operation
of the press depended on such networking.
Fourth, Liem Koen Hian connected with indigenous journalists
and nationalist leaders, such as Dr. Sutomo, Sanusi Pane and Amir
Syarifuddin. As the Association of Journalists of Asia indicates, it was
not unusual that Chinese journalists networked with indigenous jour-
nalists. Additionally, Kwee Hing Tjiat had connections with Parada
Harahap, Saerun, and Bakri Suraatmadja, while Kwee Kek Beng as
a director of Sin Po employed W.R. Supratman and D. Kusumanin-
grat. Thus personal networks intertwined and provided the basis for a
journalistic community in the Indies.
Apart from Liem Koen Hians story, disagreements among jour-
nalistsoften in the form of polemicsprovided the opportunity to
communicate and to build shared discourses through the media.
In August 1934, for instance, Kwee Hing Tjiat wrote Baba Dewasa
(A Mature Baba) in the first issue of Mata Hari. In it, he proposed that
the Baba group, the indigenized Chinese, assimilate entirely into indig-
enous communities.
The political status of the Babas as Sons of Indonesia is based not only
on moral rights, which will cure all their confusion and dualism, but on
vital economic interests as well. [. . .]
I also feel that within one generation or thirty years, with the excep-
tion of a few bawling Chinese who should be kicked out, Babas would
18
Sin Jit Po, May 28, 1926, Th. 3, No. 114, L12.
108 nobuto yamamoto
be assimilated into the [indigenous] Indonesian population, just like the

case [of the Chinese] in the Philippines, Thailand, and other places.19
The term sons of Indonesia drew comments from indigenous intel-
lectuals and journalists. Dr. Sutomo, Singgih, and Dr. Satiman agreed
with Kwee Hing Tjiats argument. With a supportive but slightly bitter
tone, Sedio Tomo, a daily newspaper in Yogyakarta, wrote:
If such stream [of thought] really comes out of a pure heart, proven
with the willingness to fulfill all duties towards Indonesia, and the atti-
tude towards sons of the soil is similar to that towards the Baba, we
believe that we Indonesians will open our door as widely as possible to
accept them.20
But the same phrase also received critical reviews from indigenous
media such as Syamsudins newspaper Bahagia (Semarang), the daily
Oetoesan Indonesia (Yogyakarta), Sanusi Panes Soeara Oemoem (Surabaya),
and Saeruns daily Pemandangan (Batavia) (Surayadinata 1993, 2526).
Bahagia wrote:
[L]et the Peranakan remain sons of China; they do not need to become
sons of Indonesia. We are Indonesians, you are Chinese! We really have
different nationalities, but we are both . . . Asians! (Suryadinata 1993, 26)
The above illustrations show that journalists shared a language and
a space for communication. Through a common language and their
printed exchange, they created an imaginary community. Even if they
disagreed with each other, they still engaged each other in the form
of public communication. Their disagreements, in fact, were often the
starting point of their writings, which indicates further that newspa-
pers depended on a network that allowed journalists to read, quote,
or argue against each other. Thus, ironically, polemics revealed inter-
dependency among journalists and network of associations. However,
in the 1930s, the more peranakan debated about the status of the
Chinese, the more they were detached from Indonesian nationalist
discourse.
19
Kwee Hing Tjiat, Baba Dewasa [A Mature Baba], Mata Hari, August 1, 1934,
translated in Suryadinata (1979, 6263). Translation is modified by the author.
20
Djawa Tengah Review (August 1934), p. 611, cited in Suryadinata (1993, 25). Trans-
lation is modified by the author.
The Chinese in Question
In order to make sense of the above mentioned quasi-national journalist

community in the Indies, one needs to evaluate conventional views on
the Chinese in the Indies and its categorizations. Then one can situ-
ate this journalist community of the Indies, get the picture of how it
developed over time, and recognize the important roles the Chinese
journalists played.
The latter question sheds new light on the ways in which the Chinese
in the Indies were categorized in historiographical works. Two types
of categorization of the Chinese deserve further examination. In this
field, we have become accustomed to use the peranakan vs. totok
dichotomy for a socio-cultural categorization of the Chinese. We are
also familiar with the three political streams of the Chinesenamely
the Sin Po group, the Chung Hwa Hui (Chinese Association) group,
and the PTI (Indonesian Chinese Party) groupall representing dif-
ferent institutional and political alliances. However, we fail to recon-
cile the two categorizationssocial and political. More specifically, the
two types of categorization fail to account for each other. Where did,
for instance, a peranakan stand in regard to his political allegiance?
The categorizations fail to explain how the socially dichotomic Chi-
nese relate to three types of political streams. As it is, two fundamental
questions are likely to emerge, that is if the conventional categoriza-
tions of the Chinese can account for a socio-political reality; was the
social really that distinct from the political? The other question is if
the categorizations were even accurate to represent the Indies Chinese
political temperaments. In order to answer these questions we need to
reconsider the two dominant categories of Chinese in the Indies.
First the peranakan-totok dichotomy. It is generally accepted that
there were two kinds of Chinese in the Indiesperanakan and totok.21
These categories are usually understood as groups of people having
different socio-cultural characteristics. In particular, scholars have paid
21
American scholars produced many works on the Chinese in Indonesia in the
1950s and the 1960s. Special attention was paid to socio-cultural aspects of the Chi-
nese in order to grasp why the Chinese (both peranakan and totok) in Java did not
assimilate into the local society like their counterparts in Thailand. Among others,
William Skinners review article (Skinner 1961) remains influential. In it Skinner refers
to the peranakan as local-born Chinese who no longer speak their ancestors Chinese
dialect and who consider Java their permanent domicile, and to totok as culturally
pure Chinese (Skinner 1961, 3567).
110 nobuto yamamoto
attention to the language that they spoke at home. It goes that per-
anakan were Indonesia (Indies)-born and spoke one of the Indonesian
vernaculars or a variant of Bahasa Indonesia known as Bahasa Melajoe
Tionghoa (Chinese Malay or Batavian Malay). The totok, on the other
hand, were those who used Chinese as the medium of communica-
tion in the family, though they were Indonesia (Indies)-born (Suryadi-
nata 1981, xiv). These dichotomous categories presumably encompass
all Chinese in the Indies regardless of their education, social status
and income level.
But this peranakan-totok dichotomy does not seem to reflect the
social reality in the Indies. Even as early as 1930, Vandenbosch (1930)
had posed a question on this categorization. He uses instead legal
categorizations when writing about the Chinese in the Indies: singkeh
(totok) are Chinese subjects, while peranakan are Indies subjects. It is
quite natural to assume that at least until 1930 legal distinctions mat-
ter when Westerners dealt with the Chinese in the Indies. In his writ-
ing, Vandenbosch remarks that beginning in 1919 the Chinese were
subjected to European laws with exceptions in inheritance and family
laws. In this case what he referred to as the Chinese were actually
the singkeh, which did not include peranakan. But this distinction was
not quite accurate either because, Vandenbosch continues, the rela-
tion between the singkeh, or Chinese subjects, and the peranakan is so
close that if the government grants singkeh the right to be tried before
European courts it cannot withhold the same privilege from the per-
anakan (Vandenbosch 1930, 1013). His admission indicates that both
singkeh and peranakan were too closely intertwined to be subjected to
different sets of law. Even Leo Suryadinata, whose scholarly works are
credited with categorizations of the Chinese, admits that his finding
does not mean that there was a sharp separation between totok and
peranakan politics (Suryadinata 1981). In other words, it is difficult to
draw lines between totok and peranakan Chinese to distinguish them
in legal or political terms.
The other oft-cited categorization concerns the three political
streams among peranakan. As early as August 1932, Liem Koen Hian
gave a talk in Surabaya about the political streams (Suryadinata 1979,
5155). It suggests that there were the China-oriented Sin Po group,
the Netherlands Indies-oriented group (CHH), and the Indonesia-
oriented political party (PTI). Eventually, the three stream theory was
widely accepted among the Chinese. Dutch and foreign scholars also
adhered to the grouping. In their files from the 1930s, the Dutch secret
mail reports made reference to the categories.22 In 1946 an American

scholar, George Kahin, remarked that three principal political group-
ings were distinguishable among the Chinese population of Indonesia,
although between them were various transitional stages (Kahin 1946).
Suryadinata, too, established his classification of peranakan Chinese
based on these claims (Surayadinata 1981).
The so-called first group, Sin Po, started to publish daily newspa-
pers in Batavia since 1911 and played a significant role in shaping a
Chinese community that was relatively pro-China. The Sin Po group
accepted its position as aliens in the Indies and refused to become
Dutch subjects. It appeared to advocate allegiance to the govern-
ment in China and always took sides with China whenever it was
under foreign assault. The second, CHH, was set up in August 1926
in Semarang and on June 6, 1928 received official acknowledgement
from the Indies government; thus it operated within the colonial legal
framework. The leadership of CHH comprised business tycoons and
landowners, residual Kapitans (Chinese officials appointed by the colo-
nial authority), and conservative intellectuals. Its programs tended to
support the colonial policy and the status quo. Lastly, the PTI was
founded on September 25, 1932 in Surabaya with Liem Koen Hian
the previously discussed journalistas chairperson and Kwee Thiam
Tjing as secretary. It strongly supported China during the troubled
relations with Japan. Many of its leaders were journalists of the daily
Sin Tit Po in Surabaya.
Yet, as our discussion on the much traveled Liem Koen Hian sug-
gests, the categories did not quite hold when it came to networking
among journalists. Liem himself, chairperson of PTI, worked with
journalists and served newspapers belonging to (supposedly) other
groups. As Vandenbosch suggests, such categories were only useful
for practical purposes. In reality, individuals habitually switched their
institutional affiliations. The Indies government adopted the categories
in its secret mail reports because this allowed it to see Chinese politics
in groups. The government naturally paid more attention to groups
and was concerned more with organizations than with individuals. To
the authorities, organization connotes movement.
22
NA, Vb. 11021933R2/MR nos. 211x/1935 and 255x/1936; and NA, Vb.
170219373 (Pluvier 1953, 88, 92).
112 nobuto yamamoto
How then should we understand the differences among peranakan

associations? Two factors deserve to be mentionedcultural affiliation
and class (ideology). Do they follow the lines of the political associa-
tions? The following discussion on the educational background of the
Chinese affiliated with Sin Po, PTI, and CHH groups will prove my
point.
The main supporting organization of the daily Sin Po was the Tiong
Hoa Hwee Koan (Chinese Association, THHK). THHK was founded
on March 17, 1900 in Batavia and in 1901 started to operate West-
ern-style schools. Their language of instruction was Mandarin with
the purpose of resinicizing peranakan. Because of THHK, the Sin Po
group belonged to a generation of resinicized peranakan who under-
stood Chinese written language because it was taught at the THHK
schools. Their socio-political influence spread rapidly, as shown in the
number of THHK schools; fifty-four by 1908 and reaching 450 by
1934. On the other hand, PTI members, like those of the CHH, usu-
ally had a Dutch education. The Dutch-Chinese Schools (Hollandsch-
Chineesche Scholen, HCS) were opened in 1908 for Chinese students.
Their curriculum followed the one in The Netherlands and their stu-
dents spoke and read Dutch. By 1930 more than 31,000 students went
to schools with Dutch instruction (Furnivall 1939, 377).
Thus, roughly speaking, due to their language (education) differences,
the way in which Indies Chinese perceived their political situations
also varied. The Sin Po group was closer to totok Chinese, whereas the
PTI and CHH Chinese were Western-minded. Yet this cultural differ-
ence did not cause major conflicts or hostile rivalry among them.
The second factor is perhaps more crucial, that is class (ideological )
difference. The disparity concerns the PTI and CHH groups more
than the other. The CHH was based in Semarang where an old per-
anakan community was already established and served as the center
for peranakan big business. It was in a sense a rightwing peranakan
party. CHHs leaders like Kan Hok Hoei (HH Kan) and Tan Tji-
ang Ling were usually criticized as being pro-Dutch. The Oei Tiong
Ham Concern, one of the biggest conglomerates in colonial Southeast
Asia, was a big supporter of CHH. The association itself was often
condemned in the peranakan newspapers as neglecting the Chinese
poor.
On the other hand, PTI was known as the party of the less
wealthy strata of peranakan society (Lohanda 1996, 164). In fact,
PTI constituted of a small minority of peranakan, relatively leftwing
professionals and journalists. It sought for a political assimilation of the

Chinese with indigenous society. The members political orientation
was generally anti-colonial and supported the Indonesian nationalist
movement. Even the partys pro-China stand was essentially based on
anti-Japanese imperialism. In this sense, PTIs political stand differed
from Sin Pos pro-China stand, which emphasized affinity with the
motherland. Therefore, while Sin Po often invited its readers to assist
China in times of trouble, Sin Tit Po paid more attention to changing
political situations in China and to anti-Japanese movements in and
outside of China.
The timing of the establishment of PTI is worth to be noted. It
was established in 1932, five years after the Partai Komunis Indonesia
(Indonesian Communist Party, PKI) was disbanded. After 1927, no
Indonesian political parties accepted Chinese as members due to what
happened with the PKI. From its early days, the communist party
bases were largely located in Semarang and Surabaya, which often
received support from local Chinese, especially Chinese workers. In
1924 PKI appointed its first Chinese executive member, Kho Tjun
Wan. When Sun Yat-sen passed away in 1925, PKI expressed sympa-
thy for the Indies Chinese and the Kuomintang. Api, the PKI organ,
also contributed to Sin Po (McVey 1965, 224230). At the same time,
Chinese people who were suspected of connections with the indigenous
communist movement were deported. For instance, five Chinese were
deported in September 1925. Three of them worked for Thien Sung
Yit Po: two editors, Wei Thien Yoe, twenty-four years old, and Tjo-
eng Koeng Yim alias Tjoeng Koe Yit alias Tjoeng Sie Hie, forty-nine
years old, and the director, Gouw Kong Hoe (Foe), forty-seven years
of age. Two others worked for the Soe Po Sia Company; Tjia Tjiok
Min, twenty-nine years old, was vice president of the company as well
as the director of Miauw Njap trading company, and Ho Sit Kioen
(Kin), thirty-five years of age, was a secretary of the company.23
But the suppression of PKI also eliminated the political channel
for left-wing journalists and professionals like Liem Koen Hian. Not
only did radical political parties disappear from the political arena, but
Indonesian parties also refused to accept Chinese as their members,
despite the fact that most pro-China peranakan were pro-Kuomintang.
Peranakan journalists and activists were thus cut off from the nascent
23
114 nobuto yamamoto
Indonesian politics and were forced to stay within their own Chinese
circles. Even under these circumstances, journalists kept communicat-
ing with each other through their culture of citation, and through their
personal networks. It was not an organized political association that
stirred politics among the Indonesian population, but rather printed
words with a broad market reach. This was how journalists related to
the nationalist movement in the 1930s.
The political situation changed again a decade later. It was not until
around 1938 when the left-wing party Gerakan Rakyat Indonesia (Indone-
sian Peoples Movement, Gerindo) opened the door for Chinese to get
involved in politics (Suryadinata 1981, 164166). Gerindo leaders, like
Amir Syarifuddin and Muh. Yaminboth prominent journalists
had close connections with Liem Koen Hian through their journalistic
network. Once this door was opened, Liem Koen Hian immediately
abandoned PTI and joined Gerindo. Now journalists were back into
Indonesian party politics.
Conclusion
Social categories may help to grasp organizational activities and net-

works, but they often overlook personal and social networks which
set organizational activities in motion. Until the late 1930s, few per-
anakan as well as Indonesians could imagine that Dutch colonialism
would come to an end in their life time. My analysis of the journalis-
tic tour of duty, networking, and its culture of citation has illustrated
how rigid distinctions along organizational and political lines cannot
be maintained on personal level. More importantly, they obscure the
dynamics across culture and class associations.
Regardless of such tight and indispensable networks among journal-
ists, we are today confronted with the fact that peranakan journalists
are left out from Indonesian national history. As I have discussed in the
chapter, this is not because they were not involved in the nationalist
movement, but rather because they were excluded from the indigenous
formal (organizational ) politics. As an institution, however, peranakan
journalism was pivotal in the development of the Indonesian national-
ist movement between the 1920s and 1930s; this was the time when
newspapers and other printed materials became socio-political media
for an emerging urban literate class in the Dutch colony. The case
of Sin Jit Po was exemplary. In fact, because peranakan journalism
was closely intertwined with the development of the newspaper in the

Indies, one might say that it laid the foundation for indigenous nation-
alists to imagine an autonomous community of Indonesia.
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CHAPTER SIX
THE LOA JOE DJIN-CASE:

A TRIGGER TO CHANGE
Patricia Tjiook-Liem
Introduction
In 1909 Loa Joe Djin, a Chinese shopkeeper in Batavia, was found

guilty of accessory to theft and subsequently sentenced. There was
nothing unusual in this fact in itself; it was a routine job in the daily
practice of the police-court. But it was the aftermath that would
prove to be of great influence on the lawmaking policy of the Indies
government.
After having served his sentence Loa took action. We do not know
his motives, but it is possible that he wanted some kind of rehabilita-
tion for the slur on his reputation due to what he felt was an unjust
verdict pronounced in a deficient criminal procedure. With his actions
he succeeded in drawing national and international attention, while at
the same time the flaws of the lower criminal administration of justice
for the Natives and their equated1 (the police-court) and the unsatisfac-
tory legal position of the Chinese in the Netherlands East Indies caught
the spotlight. It resulted in pressure that would influence the colonial
government in its decision to abandon the existing administration of
justice for minor criminal offences for the indigenous people of the
Netherlands East Indies and their equated. In 1914 the administra-
tion of justice before the police-court was replaced by the institution of
the landrechter, a professional judge who administered justice for minor
criminal offences for all population groups without distinction.
Loa Joe Djins story, apart from being an exceptional case in
which an individual Chinese not only stood up against the colonial
1
Equated to the Natives means having the same legal position as the Natives.
Equated to the Natives were Arabs, Moors, Chinese, and all Mohammedans and
heathens (art. 109 RR 1854). In colloquial speech these equated were also known as
Foreign Orientals.
118 patricia tjiook-liem
government and its administration of justice, but also found ways to

arouse national and international attention, is also a story of how in
those years that government had to reckon with internal and exter-
nal political pressure in its policy making, in this case its lawmaking
policy regarding the Chinese. The Loa-case was part of that pres-
sure, and because of its unusual character it may have even functioned
as a trigger in the reform of the administration of justice before the
police-court.
To put the case of Loa Joe Djin in perspective, this essay will start
with a short introduction of the legal position of the Chinese, then deal
with the administration of justice for minor criminal offences for the
Natives and their equated (most of them Chinese), and conclude with
a background sketch of the political situation between 1900 and 1910.
The complexity of these aspects, especially of the political situation,
regretfully demands a selection to preserve the focus.
The Legal Position of the Chinese
In 18482 one of the most important principles of the legislation for

the Netherlands East Indies, a dual legal system, was laid down in the
General Provisions of Legislation for the Netherlands East Indies.3 A
few years later, in 1854, this principle was anchored in art. 109 of the
Government Regulations (art. 109 Regeeringsreglement), which Regula-
tions were considered to be the Constitution of the Netherlands East
Indies.4 Article 109 divided the population of the Netherlands East
Indies into two main groups, the Europeans and the Natives (Inlanders),
who were each subjected to their own legal system. Each main group
had a subgroup, being those who were equated either with the Euro-
peans or with the Natives. Arabs, Moors, Chinese, and all others who
were Mohammedans or heathens were equated with the Natives. The
dual legal system meant that laws, regulations, and administration of
justice for Europeans and their equated were different from those for
the Natives and their equated. The principle of concordance, one of
2
On May 1, 1848, the years of codification of the laws for the Netherlands East
Indies ended with the coming into force of these laws.
3
Art. 69 General Provisions of Legislation for the Netherlands Indies (Algemeene
bepalingen van wetgeving voor Nederlandsch-Indi ), Ind. Stb. 1847 no. 23.
4
Art. 109 Government Regulations (Regeeringsreglement), Ind. Stb. 1855 no. 2.
the loa joe djin-case 119
the principles of the codification of the laws for the Netherlands East
Indies in 1848, required the legal system for the Europeans to follow
that of the motherland as closely as possible. In that way it would
provide them with an administration of justice, which would meet the
same standards as in the homeland.
In criminal lawand with respect to the subject in this essay we will
deal only with the administration of justice regarding minor criminal
offencesEuropeans were brought before the residency-court, while
Natives and their equated had to appear before the police-court. The
main difference between these two kinds of administration of justice
was the presence, respectively absence of sufficient guarantees for a
fair administration of justice by respectively the residency-court and
the police-court.
The Administration of Justice before the Police-Court

(Politierechtspraak, Politierol)
The administration of justice before the police-court was the admin-

istration of justice by a magistrate who was not a professional judge,
but an administrative officer. The police-court was notorious for its
arbitrariness. The institution dated back from before the codification.
Actually, it used to be the administrative decision by the resident5 of all
the cases which he considered to be improper or unlawful and at the
same time not to be important enough to be brought before a court.
When, however, punishment for the Natives for such cases was consid-
ered to be necessaryeven if it would only serve to maintain authority
of the administrationsuch a punishment would be administered by
an administrative decision (Blerkom, van 1916, 6).
In the years before the codification the codification-committee con-
sidered a transfer of this kind of administration of justice (an admin-
istration of justice outrageous under a civilized administration, as
the chairman of the codification-committee wrote) to an independent
professional judge.6 Then, separation of powers would be established.
For the Natives and their equated such a transfer would mean a
5
Administrative head of a district or region.
6
Chairman codification committee to Minister of Colonies, 31-08-1845, National
Archives The Hague, Archives Scholten van Oud Haarlem, inv. 48. National Archives
The Hague hereafter as NA.
considerable improvement. However, the scales turned in favor of

those who wanted to hold on to the police-court as it functioned. They
considered it of the utmost importance that the administrative offi-
cer should keep his competency to administer justice. In that way he
would be able to use that power as an important instrument to force
the indigenous people to serve the economic goals of the government.
These economic goals ran concurrently with the proceeds of the then
operational Culture-system and had top priority.
So it happened that in 1848 the police-court acquired a legal foun-
dation in art. 110 of the Regulations for the Judicial Organization
(Reglement voor de Rechterlijke Organisatie). In minor criminal offences
Natives and their equated were brought before the magistrate of the
police-court, who at the same time was an administrative officer.
Of the main characteristics of the police-court we mention:
1. There was, as already mentioned, no separation of powers. In

principle the magistrate was an administrative officer, the resident,
who could delegate his competence to the assistant-resident or the
controleur.7 Usually, the assistant-resident was also the head of the
police (Blerkom, van 1916, 3151).
2. There were no or very few rules of criminal procedure to guarantee
adequate criminal proceedings (Blerkom, van 1916, 6269).
3. There were no rules for evidence. The magistrate could pass judg-
ment at his own discretion, as he saw fit (Blerkom, van 1916, 108,
112).
4. He had no duty or obligation to motivate his judgment. Should he
be bound to motivate his sentence, then he would have to show
how he had arrived at his judgment. Usually registering the sen-
tence in the records sufficed (Blerkom, van 1916, 8894).
5. There was no appeal. The magistrate was the judge from first to
last instance. No one could change the sentence, not his superior,
e.g., the resident, not even he himself, nor the High Court of the
Netherlands East Indies. The High Court was only responsible for
the supervision of the quarterly registers of the police-court and the
only thing the Court could do was to comment on these registers
(Blerkom, van 1916, 95106).
7
Controleur: the lowest in rank in the colonial administration.
Once sentenced the only thing the convicted could do to escape

punishment was to ask the Governor-General for mercy. The lat-
ter could decide for moderation of the sentence or acquittal of the
punishment. While in the nineteenth century immediate execution
of the sentence followed the magistrates decision, after the turn of
the century execution was more often suspended awaiting the deci-
sion of the Governor-General. When mercy was granted, punishment
had sometimes already partly of wholly been carried out. In the first
case the convicted did not have to undergo the punishment further.
Then, as one author said, mercy had the character of an expression
of regret, a declaration of sympathy. However, the sentence of being
guilty of the offence he was accused of remained. By granting mercy,
the Governor-General as the highest representative of the Queen had
actually become a judge of appeal. The right to grant mercy had then
been used for another purpose than what it was meant for (Blerkom,
van 1916, 98104).
Apart from its arbitrariness, the police-court (Tjiook-Liem 2009,
395) was also feared for the humiliating way defendants were tried and
punished. The magistrate could impose a fine up to of twenty-five guil-
ders or labor at the public works for food without pay for a maximum
of ninety days. Cane-beating and locking in the block were abolished
in the nineteenth century (Tjiook-Liem 2009, 396398). Defendants
who were brought to the police-court were tied to each other by a
rope on their upper arms. For many people, especially people of some
social standing, it was a nightmare to be brought up like that, and after
having been sentenced, to have to walk the streets behind a garbage-
cart and undergo the punishment of labor at the public works. Some-
times death by suicide was preferred above punishment (Ruyter de
Wildt, de 1917, 450451).
In 1909, the year of the Loa-case, about forty years after the end of
the Cultivation System, this situation was basically unchanged.
The Political Situation in the First Decade of the Twentieth Century
The turn of the nineteenth into the twentieth century marked the
beginning of a new episode in the history of the Chinese in the Neth-
erlands East Indies. It is impossible and with respect to the Loa Joe
Djin case it would go too far to deal extensively with all aspects and
factors which in a larger or lesser degree influenced or may have influ-

enced this new period.
To give an idea of the complex situation in those years of change
we will mention at random a number of these factors. On the side of
the Chinese these were for instance: the changed relations between
the Chinese and the Indies government since the end of the opium
and other farms; the question of leadership of the Chinese in the eyes
of the Chinese communities themselves; the equation of the Japanese
with Europeans by the Japanese law of 1899, which accentuated the
feeling of discrimination of the Chinese; the quest for emancipation,
especially for better education and a better legal position, the rise of
nationalism and Chinas support, the rise of a Malay and Chinese press.
The government on the other side had to reckon with: the awaken-
ing of the East with a powerful and victorious Japan and an upcoming
China; the discontentment of the Chinese with their legal position,
starting with their efforts to have the pass and zoning system abol-
ished; the rise of Malay and Chinese newspapers in Netherlands East
Indies, the interest of the international press, especially the press in
China in matters concerning the legal position of the Chinese in the
Netherlands East Indies; the demands of China to appoint consuls in
the Netherlands East Indies; the Law on Dutch Citizenship (Wet op
het Nederlandsch Onderdaanschap) to establish authority over the Chinese,
an urgent matter after the Dutch and Chinese Nationality Acts of
respectively 1892 and 1909; the rise of Indonesian nationalism by the
founding of Budi Utomo and last but not least the need of preserving
prestige of the Dutch and Indies government.
We will focus on three aspects, which, in connection to the Loa-
case, were of direct influence either on the Chinese or on the Dutch
and Indies governments and their policy. The first one is the quest
for emancipation and the rise of nationalism among the Chinese in
the Netherlands East Indies. The second one is the growing interest
of China for the overseas Chinese, whom it more and more claimed
as his subjects. And the third is the change of policy of the Dutch and
the Indies governments.
The period of emancipation8 for the Chinese in the Netherlands
East Indies started at the end of the 19th century. The founding of the
8
We follow Van Dales definition of emancipation as the liberation from legal,
social, political, or intellectual restrictions and limitations, as the assignment of equal
Tiong Hoa Hwee Koan (THHK, Chinese Association) in 1900 is gener-

ally considered to be the official start of what is coined by Fromberg
as the Chinese movement (Chineesche beweging), a movement strug-
gling for a better legal position (Fromberg 1926, 450). Actually, in
those early years the goal of the THHK was aimed at a re-orientation
on Confucianism. However, to be able to understand the teachings
of Confucius, it was necessary to have a command of the Chinese
language, which most of the peranakan Chinese who were born in the
Netherlands East Indies and who had lived there for generations, had
lost. So in the following year the next step of the THHK was to set up
schools for the Chinese children, in which the Chinese language was
part of the curriculum (Kwee 1969, 1516). These schools proved to
be a great success, notwithstanding the fact that the Indies government
abstained from any support (Govaars-Tjia 1999, 64). In 1908 fifty-
five THHK schools were functioning with 5,500 pupils (Govaars-Tjia
1999, 73). The realization of a common and practical goal, education
for the Chinese youth, also united the Chinese population (Williams
1960, 66).
This reorientation on Confucianism, called by Suryadinata cul-
tural nationalism (Suryadinata 1999, xiv), was soon followed by the
pursuit for the abolition of various grievances. Of these grievances
we will only mention the two most important ones. The first serious
grievance was the pass and zoning system (het passen en wijkenstelsel).
This system meant in practice that for Chinese the freedom of move-
ment and of choosing a place to live and settle down was restricted
and regulated by various ordinances. The second grievance was the
administration of justice before the police-court. Although the Chinese
quest for a better legal position started with the efforts for the aboli-
tion of these restrictive, discriminating and humiliating regulations,
in the end it was equation they wanted, a legal position equal to that
of the Europeans, the same position as the Japanese had acquired in
1899. Actually, the Japanese in the Netherlands East Indies did not
meet the two official criteria for equation as mentioned in art. 109
of the Government Regulations: race and religion; they were neither
Europeans nor Christians. And although their number was small and
their social position low, and although they had never expressed a
rights and as equation before the law (Van Dale Groot Woordenboek der Nederlandse
Taal, 1992).
wish for equation, they were nevertheless equated with the Europeans
in art. 109 Government Regulations of 1899. It was considered to be
a political move, but all the same the Chinese felt it to be an insulting
discrimination.9
Sino-Malay newspapers started appearing in 1901 and they gave
voice to the ambitions of the Chinese in the Netherlands East Indies.
They contributed to the development of a pan-Chinese movement
aimed at the unification of the Chinese in the Netherlands East Indies
and at a cultural and political orientation on China (Suryadinata 1981,
6). Some of them, as for instance the Kabar Perniagaan and later the
China-oriented Sin Po became very influential. Also in that first decade
Chinese commercial organizations as the Siang Hwee and the Chi-
nese reading clubs Soe Po Sia were set up. The Siang Hwee func-
tioned as a Chamber of Commerce with direct contacts with China
and contributed to a closer connection with that country. The Soe
Po Sia, which initially focused on educational activities, became more
and more politically orientated (Govaars-Tjia 1999, 6973; Williams
1960, 95109).
The Indies government had not only to deal with these develop-
ments in the Netherlands East Indies itself, she had also to face a
growing interest from China for the Chinese. A connection of the
Chinese in Netherlands East India with the ancestral homeland was
established when the THHK schools needed teachers for the Chi-
nese language. These teachers were recruited from Singapore, Japan,
and China and the connection with China resulted in an active inter-
est from the Chinese government. The latter even set up a school in
Nanking to continue the THHK-education of these Chinese students
(Govaars-Tjia 1999, 6465). Starting in 1906 government officials and
others such as school-inspectors were sent by China to inspect the
Chinese schools, although such an inspection was also used as a pre-
text for other interests, commercial as well as political. At first visiting
officials from the Chinese government were received cordially by the
Indies government. But this soon changed when the frequency of these
visits increased and when these visitors arrived accompanied by navy
vessels and even warships. The positive and enthusiastic feelings of the
Chinese in the Netherlands East Indies for these visitors from China
were in profound contrast to their negative attitude to the Indies
9
See for the realization of this amendment, Tjiook-Liem (2005, 192208).
government. Chinas interest led, to use the phrase of Williams, to

Chinese nationalism (Williams 1960, 8891, 151158).
The press in China also kept a watchful eye on what went on in the
Netherlands East Indies and would not hesitate to complain about or
expose the discriminatory regulations and the unsatisfactory legal posi-
tion of the Chinese in general.10 Pressure was also felt in The Hague,
where the Chinese ambassador Lou Tseng Tsiang frequently brought
Chinas concern and complaints to the attention of the Dutch Min-
ister of Foreign Affairs. Policy of the latter usually was to bide some
time by answering that he had to consult his colleague the Minister of
Colonies first, who in his turn had to contact the Governor-General
in Batavia.
It was not until 1906 that the government in The Netherlands as
well as in the Netherlands East Indies realized that the pressure, espe-
cially on account of the changed political relations in Asia, asked for
another policy. The two main things that were decided upon was that
the demands of the Chinese for Dutch education and a better legal
position had to be met and that a dam should be raised against Chi-
nas influence and interference in what was considered Dutch internal
affairs.11 In 1908 the Indies government opened the first Dutch-Chinese
schools. Reform of the pass and zoning system had become urgent,
delay could no longer be tolerated. Actually, plans for reform were
already made at the end of the nineteenth century, but they had not
yet materialized in a draft, due to opposition from and disagreement
among some leading high officials in Batavia.12 Another concern of
the Netherlands Indies government was that the impression should be
avoided as much as possible that the new policy was the outcome of
pressure (which it actually was).
In January 1909, the month in which Loa Joe Djin was sentenced,
no steps were taken concerning the other serious grievance, the admin-
istration of justice before the police-court. The government acknowl-
edged and admitted that this kind of administration of justice was
10
Dutch charg daffaires in Peking to Minister of Foreign Affairs, 14-07-1909
no.880/216, NA, Vb.15-10-1909, R.20/inv.114.
11
Minister of Colonies to Governor-General, 03-11-1905-46, NA, Vb.03-11-1905/
inv.342; Governor-General to Minister of Colonies, 09-08-1906-59/1 confidential,
NA, Vb. 15-10-1909, R.20/inv.114.
12
Governor-General to Minister of Colonies, 09-08-1906-59/1 confidential, NA,
Vb.15-10-1909, R.20/inv.114.
unsatisfactory and the complaints of the Chinese justified, but there

was no sense of urgency.
The Loa Joe Djin-Case: Two Sides of a Coin
On January 16, 1909, Loa Joe Djin, a Chinese shopkeeper in Batavia,

was sentenced by the magistrate of the police-court of that town to the
maximum punishment of ninety days hard labor at the public works
for food without pay. Loa was found guilty of being an accessory to
theft of a number of gramophone records. His petition for mercy was
denied by the Governor-General on the fifth of March of that year.
Loa served his sentence.
At the court session the following testimony of a Dutch lady, Mrs.
Hoolboom, confirmed by her friend Mrs. van Veem, was decisive. In
December 23, 1908 Mrs. Hoolboom missed a box containing gramo-
phone records. She assumed that they were stolen by a Chinese house-
painter, whom she had called in from the street to do some odd jobs
in the house. A few days after having reported the theft to the police
Mrs. Hoolboom decided to conduct a search for the records herself.
Accompanied by her friend Mrs. van Veem, she first went to look for
them in a pawnshop. There they advised her to go to Pasar Senn.
The second shop she visited there was the shop of Loa Joe Djin. Loa
sold several things, among which second-hand gramophone records.
Both ladies browsed through the records, but the missing ones could
not be found. According to her own testimony, Mrs. Hoolboom then,
without Loas permission, opened a cupboard, in which she found a
box with ten gramophone records. Although the lid of the box was
missing (and on that lid she herself had written down her name), she
identified the box and the records as hers. The dent13 on one of the
records, the Caruso record (equal to one of her missing records), con-
vinced her that these records were hers. Without confronting Loa with
this discovery and after telling Loa that she intended to buy some
records and would come back for them later she left the shop to phone
her husband and the bailiff. When Mrs. Hoolboom returned a short
time later, accompanied by the two men, box and records were not
to be found. Loa denied having other records than those in his shop.
13
Dent is used here for the Malay word somplak.
Even after a house search (which in the case of Chinese and other
non-European people could be done without a search warrant), box
and records did not surface, according to Mrs. Hoolboom because Loa
had sent his employee after her to spy on her when she was looking for
a telephone to warn husband and bailiff. (The employee, Tan Keng
Tjiang, admitted having gone to the pawnhouse, where Mrs. Hool-
boom went to telephone, but not by order of Loa). The bailiff gave
credit to Mrs. Hoolbooms testimony and concluded that Loa should
be brought before the police-court magistrate. He believed that Loa
liked to occupy himself with fencing (ia soeka djadi toekang tadah), buying
and selling stolen goods in close collaboration with his employee.
Against these two statements Loa testified that, when Mrs. Hool-
boom came to his shop to buy some gramophone records, he showed
her the records he had, and that when she decided not to buy, he did
not send his employee after her. When she returned he had shown the
bailiff the records Mrs. Hoolboom intended to buy. He denied having
other gramophone records in his possession or having hidden any.
The magistrate found Loa guilty of accessory to theft and subsequently
sentenced him to the maximum punishment of ninety days of hard
labor at the public works for food without pay.14
In his petition for mercy to the Governor-General, Loa persisted in
his innocence. He based his petition on the following grounds:
1. The magistrates competence. Loa doubted the magistrates compe-

tence to hear his case, as the value of the stolen goods had not been
established before the court session and that value actually could
not be established as the corpus delicti was missing. If the value had
been decided on twenty-five guilders or more, the case would be
heard by another court, the landraad. Then a professional judge
would administer justice on legal and convincing proof, while the
police-court magistrate administered justice on his subjective con-
viction, without any guarantee for an objective investigation and
without an adequate defense for the accused.
14
Statements of Mrs. Hoolboom, the bailiff of Tanah Abang Hekman and Loa
Joe Djin; sentence of the assistant-resident signed by the inspector of police Van der
Meer June 16, 1909, as noted in the Register of the Police-Court Batavia; assistant-
resident to resident of Batavia Jauary 29, 1909. The summary of Mrs. Hoolbooms
testimony by the assistant-resident W.J. Ketjen in his letter to the resident of Batavia
January 29, 1909, deviates in some respects from her statement, NA, Vb.02-10-1909,
X.19/inv.113.
2. Loa further stated that he was sentenced solely on the testimonies

of the two ladies, who were not under oath and testified in each
others presence. Mrs. van Veem confirmed Mrs. Hoolbooms story
and helped her when her friends memory let her down.
3. The dent on the Caruso record, which had been accepted as the
convincing proof that the record was one of the stolen records of
Mrs. Hoolboom, was, according to Loa, of no significance. This
dent was due to a technical impairment, which could be found
on all records of that edition. Mrs. Hoolbooms ownership of the
records had therefore not been established, so there was no proof
of fencing.
4. Loa also put forward that he himself had not been given the oppor-
tunity either to have his own witnesses heard or defend his case at
the courts session as, immediately after Mrs. Hoolboom had testi-
fied and Mrs. van Veem had confirmed this testimony, sentence
was passed.
5. About himself, Loa claimed that during the sixteen years that he
ran the shop he had never been in trouble with the law. He had
even been helpful to the police and had always had a good repu-
tation. He was not afraid of any inquiry by any authority, police-
official or Chinese district-chief. On being asked, the inspector of
police Van der Meer, who at the same time administered justice in
Loas case, confirmed to Loas solicitor, Mr. Hoorweg, that nothing
unfavorable was known about Loa.
6. Loa further stated that, notwithstanding that his solicitor had
repeatedly told him that, if he delivered the records, he would not
be punished and would get off scot-free, and that the magistrate
had given him the opportunity to do that within eight days, it was
impossible for him to do so as he did not have and never had the
records. He persisted in his denial of having other records than
those in his shop or having sent his employee after the ladies.
7. He was prepared to swear in the most ceremonious and solemn
way the most terrible oath for Chinese. This would mean that,
should he be really guilty, his descendants up to the seventh genera-
tion would be cursed and doomed.
8. Loa also brought forward that if he, as a man not without means
and being a member of a respectable family of merchants, should
have to undergo hard labor on the public works for food without
pay on such loose grounds, he would become forever impossible
in the eyes of his fellow citizens. For more than sixteen years he
had been a decent taxpayer and his reputation had so far been
unblemished.15
To his petition Loa added a statement by his wife, his brother-in-law

and a coolie-foreman, made before a notary public. In this statement
these three persons said that after Loas conviction the two ladies went
to Loas house to ask Loas wife for a compensation of one hundred
guilders for the lost records. This statement was seriously doubted
by the assistant-resident, who choose to believe the two ladies. Mrs.
Hoolboom and Mrs. van Veem admitted having gone to Loas house
after the sentence (and as the assistant-resident himself wrote: brag-
ging triumphantly that they had Loa punished and thereby causing a
crowd) to try to recover the records. When Loas wife told them she
did not have the records, the ladies said that Mrs. Loa instead offered
them one hundred guilders to put in a good word for Loa with the
inspector of police.16
The advices, which the Governor-General received from the
authorities involved, were negative without exception and were mostly
concentrated on the criminal procedure that had been followed. They
said that the case had been dealt with entirely in accordance with
the law. There had been no miscarriage of justice, therefore there
was no reason for complaints. In his advice to the resident of Bata-
via the assistant-resident went through the case again,17 thereby men-
tioning that after the sentence had been pronounced, Loas solicitor,
Mr. Hoorweg, in the presence of the two ladies, the djaksa18 and the
magistrate, had declared that he himself, after the session and the
given testimonies, was convinced of Loas guilt. The assistant-resident
concluded that there were no mitigating circumstances, and that the
defendant made the impression of being an exceptionally sly and
15
Loas petition for mercy 29-01-1909, NA, Vb.02-10-1909, X.19/inv.113. Only
Loas most important arguments are used here.
16
About this statement see: assistant-resident to resident Batavia, NA, 29-01-1909
no.498/4, pp. 4, 7 and 8, NA, Vb.02-10-1909, X.19/inv.113.
17
The assistant-resident Ketjen denied the arguments which Loa put forward in
his petition for mercy. It is not clear whether Ketjen himself or the inspector of police
Van der Meer acted as magistrate.
18
Native prosecutor.
cunning person. A strict example should be made to other fencers.

The petition for mercy was denied on the fifth of March.19
June 1909
So far the Loa-case was everyday practice at the police-court. It was

justice as usual. In June 1909, after having served his sentence, it turned
out that Loa did not have the intention to rest his case. He published
an article in the Malay newspaper, Kabar Perniagaan, in which he wrote
that he had been wrongly accused and innocently sentenced on the
false testimonies of two Dutch ladies. He also mentioned that he had
sent telegrams to the Chinese Minister of Foreign Affairs in Peking,
the viceroy of Nanking, and the Chinese ambassador in The Hague.
In these telegrams he explained his case and stated that he had been
sentenced without due process, without been given the opportunity of
executing his right of defense. He concluded his telegrams with the
remark that he would prefer to be financially ruined on the costs of
his rehabilitation, than to be submitted to such an unfair and arbitrary
administration of justice. The telegrams cost him 600 guilders, which
in those days approached the monthly salary of a judge in the Neth-
erlands East Indies with ten years of service.20
With these actions Loa made the front pages of the Dutch press in
the Indies. It resulted in three leading articles, two in the Bataviaasch
Nieuwsblad and one in De Locomotief. These newspapers also reported
that the Chinese Council of Batavia had stepped into the case. It was
reported that in their meeting the members of the Council demanded
that in the future the Chinese should be heard before a real court and
not before an inspector with a clerk (een controleur met een djoeroetoelis).21
In the wake of the Bataviaasch Nieuwsblad and De Locomotief other Dutch
19
Assistant-resident to resident Batavia 29-01-1909 no.498/4; advices to the Gov-
ernor-General of the resident Batavia 08-02-1909 no.23442/4; Attorney-General at
the High Court 11-02-1909 no. 461; High Court 16-02-1909; Governments Decision
05-03-1909 no. 42, all in NA, Vb.02-10-1909, X.19/inv.113.
20
At that time a Dutch judge with ten years of service would enjoy a monthly
salary of 700 guilders. Council of the Netherlands East Indies to Governor-General
29-03-1910-XXXVII, p. 4, NA, Ministery of Colonies, file no. 934.
21
Articles in Bataviaasch Nieuwsblad March 6, 1909 and April 4, 1909; in the Loco-
motief April 6, 1909; in resident Batavia to Governor-General 22-06-1909-156 F, con-
fidential, NA, Vb.02-10-1909, X.19/inv.113.
and Malay newspapers picked up the item. In their comments they all
disapproved of the existing administration of justice, which, apart from
the question of guilt, was considered a mockery of justice.22
In June 1909 the local administrative officers brushed aside the news
about the Chinese Council with the remark that their meeting was of
no importance and the news coverage a matter of exaggerated and
distorted interpretation, possibly far from the truth.23 In its petition
the Chinese Council requested the Indies government to equate the
Chinese with the Europeans, as far as the criminal administration of
justice was concerned, or at least to be withdrawn from the adminis-
tration of justice before the police-court. Contrary to the local admin-
istration the request was taken seriously by the Director of Justice. The
government decided that for the moment a formal answer meant to
put oil in troubled waters and to bide some time for more concrete
plans, would do. The petition, so the government answered, would be
considered in the discussion around the already existing plans of the
government to reform the administration of justice, including that of
the police-court. At that moment there were no plans in Batavia, just
ideas how to cope best with the political pressure. Even so, realization
dawned in government circles that with the given answer the appear-
ance of having given in to pressure would not be taken away.24
In The Hague the Chinese ambassador Lou Tseng Tsiang, after
having received Loa Joe Djins telegram, lost no time. He requested
an investigation, which the Minister of Foreign Affairs, R. de Marees
van Swinderen, passed on to his colleague, the Minister of Colonies,
A.W.F. Idenburg. To the last de Marees admitted that ambassador
Lous remark held some truth. Lou remarked that a small merchant
as the complainant would not go to such high costs by sending his
22
Newspaper cuttings June 1909 from the following newspapers: Bintang Soera-
baia, Pewarta Soerabaia, Pantjaran Warta, Pemberita Betawi, Soerabaiasch Handelsblad; in NA
Archives Ministery of Foreign Affairs concerning citizenship Netherlands East Indies-
Chinese 18921903, file no. 38.
23
Assistant-resident to resident Batavia 22-06-1909-4572/4; resident Batavia to
Governor-General 22-06-1909-156 F, NA, Vb.02-10-1909, X.19/inv.113.
24
Undated petition of the Chinese Council (probably submitted between June 22
and August 11, 1909); Director of Justice to Governor-General 07-06-1909-174, most
confidential; Director of Justice to Governor-General 11-08-1909-266 confidential;
Council of the Netherlands East Indies to Governor-General 27-08-1909-XXIII, Gov-
ernment Decision 05-09-1909-5, NA, Vb.10-10-1911, 91/inv.869.
telegram, if he were not innocent and sure about his unjust conviction.25
But Idenburg, on the contrary, suspected that the ambassador again
was meddling improperly with Dutch internal affairs26 and that in that
case not much store should be set at the matter of the high costs.27 He
attached more importance to the question of Loas citizenship than to
the question of his guilt. Should Loa fulfill the requirements for Dutch
citizenship according to the draft of the Dutch Citizenship lawwhich
law was soon to beproclaimedthen Loa would fall under Dutch
authority, and Chinas request could be declined.
In Batavia the ministers request for full information forced the offi-
cials involved to render an account of the justice administered. The
Loa-case that until then had been an internal and normal affair in the
Netherlands East Indies had drawn the attention of the government
in The Hague and beyond.
The Ideas of Idenburg and Nederburgh about Reforms
In 1909 and 1910 the two main actors in the decision process regard-
ing the reform of the administration of justice before the police-court
were A.W.F. Idenburg, Minister of Colonies and subsequently Gover-
nor-General and I.A. Nederburgh, Director of Justice in Batavia. In
August 1909 Idenburg turned over his office of Minister of Colonies in
The Hague to his successor J.H. de Waal Malefijt, to become Gover-
nor-General for the Netherlands East Indies. There he took over office
from Governor-General J.B. van Heutsz on the December 18, 1909
(Wal, van der 1964, 694).
Both Idenburg and Nederburgh were very concerned about the
political situation. Although they were not in direct contact with each
other, they shared the same view regarding the political situation in
1909. However, they had a different solution in mind. Already in April
25
Minister of Foreign Affairs to Minister of Colonies 04-06-1909 no. 11362, enclos-
ing a translation of Loas telegram, NA, Vb.09-06-1909, P.2/inv.110.
26
The activities of the Chinese ambassador Lou Tseng Tsiang in 1908 and 1909
in matters regarding the legal position of the Chinese and their nationality were con-
sidered by the Minister of Colonies Idenburg to be improper meddling and most
irritable, Minister of Colonies to Minister of Foreign Affairs, 28-05-1909 no.W.11 in
Vb.28-05-1909, W.11/inv.110.
27
Minister of Colonies to Minister of Foreign Affairs 09-06-1909-P.12 no. 50 con-
fidential, NA, Vb.09-06-1909, P.12/inv.110.
1909, before he was informed about the Loa-case, Minister of Colo-

nies Idenburg had developed some ideas of how to meet the demands
of the Chinese. On account of the political implications the govern-
ment could no longer close her eyes and ears to the complaints against
the administration of justice for the Foreign Orientals. Next to the
pass and zoning system, the Chinese and the Arabs held the most
serious grievances against this institution. After the letters of the Dutch
ambassador in Peking, F. Beelaerts van Blokland, the information of
the advisor of Indian and Arab matters C. Snouck Hurgronje, and
the articles in the press in Java, something had to happen. Idenburg
considered it good policy not to wait until circumstances would force
the government to concessions. At this moment reform could still be
done with the appearance of good will. Therefore Chinese and other
Foreign Orientals, who were already for the greater part subjected to
European civil law and the connecting civil procedure,28 should be
equated with Europeans without delay, at least on the field of crimi-
nal administration of justice. Although Idenburg foresaw that such an
equation would lead to ill feelings among the educated indigenous peo-
ple, such objections would have to make way for the political necessity.
If the equation of administration of justice of the Foreign Orientals
were to be followed with plans to improve the administration of justice
for Natives, then the offensiveness of that measureshould it really
existwould be reduced to very small proportions (zou het kwetsende
van de eerstbedoelde maatregel, als het al werkelijk mocht bestaan, toch tot zeer
geringe afmetingen zijn teruggebracht ).29 Also the usually insurmountable
objections and stumbling blocks for such measuresbig sacrifices for
the state coffers and extension of judicial personnelwould have to
make way for the huge political importance, as Idenburg wrote.30 In
April 1909, under the pressure of the political situation, Idenburg was
prepared to give in to the demands of the Chinese in the Netherlands
East Indies and equate the Foreign Orientals with the Europeans for
the entire criminal administration of justice.
28
Stb. 1855 no. 79.
29
Minister of Colonies Idenburg to State Committee, and Minister of Colonies
to Governor-General 08-04-1909 no. 35, NA, Archives Ministery of Colonies, file
no. 930.
30
Minister of Colonies to State Committee, and Minister of Colonies to Governor-
General 08-04-1909-35, NA, Archives Ministery of Colonies, file no. 930.
A few months later, in July 1909, for Idenburg the political necessity
had become a political urgency, most probably on account of the Loa
Joe Djin-case. He urged the State-committee, to whom he had com-
missioned the working out of his ideas into drafts to speed up.31
For Nederburgh, at the other side of the world, in Batavia, the
developments in the Netherlands East Indies did not come unexpect-
edly. Already in 189832 he had expressed his views that sooner or
later a new situation with equal rights for Europeans and non-Euro-
peans would come and that it would be wise to be prepared. After
the amendment of the Government Regulations in 1899, by which the
Japanese were equated with the Europeans, he had pleaded for the
abolition of the racial distinction to reef the sails before the storm.33
In August 1909, facing the national and international turmoil caused
by the publication of the Loa Joe Djin-case, the petition of the Chi-
nese Council, and the request of the Minister of Colonies for a full
report, he expressed the following views to Governor-General J.B. van
Heutsz. Although in itself the publications in the press may not be of
great importance, as the local administration considered, it was a dif-
ferent matter put in connection with the growing resentment about the
existing situation of the Chinese in the Netherlands East Indies and in
China. Nederburgh believed that it would only be a matter of years
before the colonial policy and the connecting old-fashioned situa-
tion would come to an end. He characterized the situation at that
very moment as periculum in mora.34 Waiting any longer would
weaken the position of the Indies government against China and the
Indies Chinese. Now already the appearance of enforcement could
not be wholly avoided. Should the government be forced in the future
to acknowledge equal rights again and again, which she could have
acknowledged earlier in an honorable way and of her own accord,
then each time such enforcements would mean a blow in the face and
a slur on prestige and national honor. He did not expect the Chinese
to stop until the reason of their discontentment would have been taken
away and until they were given a fair place in the Netherlands Indies
31
Minister of Colonies to State Committee 14-07-1909-44, NA, Archives Ministery
of Colonies, file no. 930.
32
Nederburgh (18961898, 333, 335).
33
Nederburgh (1903, 54, 62).
34
Mortal danger.
society. In contrast to Idenburg, he did not favor the idea of equating

only the Foreign Orientals with Europeans as far as it concerned the
administration of justice, while at the same time keeping the existing
situation for the Natives. He saw the solution in the establishment
of an equal and fair administration of justice for the whole popula-
tion of the Netherlands East Indies, especially the administration of
justice for minor offenses before the police-court, which, he admitted,
was not satisfactory. Further, by letting the information slip to the
public that the Department of Justice in Batavia was already working
on a draft for a total reform of the administration of justice before the
police-court, the government would be saved from the appearance of
having given in to pressure. In doing so she would not only have met
the existing demands, but at the same time troublemakers would be
disarmed.35 Three birds would then be killed with one stone.
In office in December 1909, Governor-General Idenburg wasted no
time. He took up Nederburghs idea only to reform i.c. to unify the
administration of justice before the police-court. The principle of con-
cordance in the new art. 75 Government Regulations did not prove to
be an obstacle. It allowed Europeans to be submitted to the criminal
procedure for Natives and their equated, although for Europeans it
would mean a leveling down (nivellering). To make the administra-
tion of justice in minor criminal offences for Natives and their equated
acceptable for Europeans it had to be upgraded.36
The year 1910 showed a growing political pressure in the Neth-
erlands East Indies and abroad. In Batavia Idenburgs office faced
petitions from individual and groups of Chinese for abolishment of
the administration of justice before the police-court and of the pass
and zoning system. There were rumors about a secret circular calling
on Chinese teachers, the Chinese Chamber of Commerce and other
Chinese associations to take action. Petitions, eventually followed by
telegrams were to be sent to several authorities in China and to the
Chinese ambassador in The Hague. These actions were to continue
35
Director of Justice Nederburgh to Governor-General Van Heutsz 07-06-1909
no.174, most confidential, NA, Vb.10-10-1911, 91/inv.869.
36
Governor-General to Minister of Colonies 23-04-1910-26/1 confidential, NA,
Archives Minister of Colonies file no. 934, Governor-General to Minister of Colonies
11-06-1910-37/1 confidential, NA, Archives Ministery of Colonies, file no. 932, Min-
ister of Colonies to Governor-General 19-01-1911-41, Minister of Colonies to State
Committee 25-07-1911-22, NA, Archives Ministery of Colonies, file no. 933.
and if necessary to be expanded, until the Chinese would be satisfied

with the measures taken by the government.37
Idenburgs letters and telegrams to the Minister of Colonies to get
the latters agreement for the reform breathed the sense of urgency.
Even after De Waal Malefijts agreement to the reform plans Idenburg
did not slow down. He requested the Minister of Colonies, although
detailed plans were not ready yet, to ask parliament beforehand for a
fundamental decision and subsequently make these plans public. The
minister refused. For Idenburg the political urgency was huge. China
would soon send consuls to the Netherlands East Indies. Undoubtedly
they would bring forward the grievances of the Chinese population.
Should the plans for reform of the administration of justice before the
police-court become known after these complaints, then it would look
as if the reform were an achievement of these consuls.38
The mills of government could not grind faster. In spite of Iden-
burgs efforts, it lasted until January 1914 before the administration of
justice before the police-court was replaced with the institution of the
landrechter. Starting that year a professional judge would administer
justice in minor criminal offences to Europeans, Natives, and Foreign
Orientals without distinction. On that level of criminal administration
of justice unification had been established.
Concluding Remarks
Due to the timing and the ways Loa tried to get attention for his case,
its effects must be considered important. The timing was unintentional,
but the Loa-case occurred in the midst of a period of great discontent
about the legal position of the Chinese in general and the mentioned
grievances in particular. The time was ripethe case fell in fertile
grounds due to Loas resourcefulness in choosing the stages to present
his case. In such a situation it could function as a trigger, as it did.
37
Governor-General to Minister of Colonies 26-10-1910-68/1 confidential; Dutch
ambassador in Peking to Governor-General 27-10-1910 no. 1536/370, NA, Vb.20-
12-1910, 22/inv.789.
38
Governor-General to Ministery of Colonies 11-06-1910-37/1 confidential, NA,
Archives Minister of Colonies, file no. 932; Governor-General to Minister of Colonies
10-08-1911-1037/11, NA, Vb.10.10.1911-91/inv.869; Telegram Governor-General
to Ministery of Colonies 12-06-1911-444 and Telegram Minister of Colonies to Gov-
ernor-General 13-06-1911-42, NA, Vb.13-06-1911, 42/inv.834.
The Loa-case very clearly illustrated the complaints of the Chinese

in the Netherlands East Indies. By making the flaws of a poor admin-
istration of justice visible in a concrete case it increased the impact.
At the same time the case was implicitly a complaint against the pas-
siveness of the government. The latter acknowledged the poor quality
of the administration of justice, but it was a bridge too far for her to
take steps to improve or abolish this institution. There was no political
need and in those days fair administration of justice for Natives and
their equated was just not a matter of course.
The importance and subsequently the priority to change govern-
ments policy came only under political pressure. Several aspects of
foreign (especially in connection to China) and domestic policy, fear of
loss of prestige in the eyes of press and public were decisive.
Whether Loa found some satisfaction in the course of events, we
will never know. What he did was quite unusual. His case showed
the powerlessness of a defendant in the existing system. Powerless as
he was in and outside the courtroom, he must have realized that in
the Netherlands East Indies itself he would not stand a chance to be
taken seriously by the government. Only political pressure from out-
side, from China, and support from the press and the public would
help, and that is what Loa decided upon.
Bibliography
Blerkom, M. van. 1916. De ontwikkeling van de politie-rechtspraak in Nederlandsch-Indi, PhD

diss., Leiden University.
Fromberg, P.H. 1926. Verspreide geschriften. Leiden: Leidsche Uitg. Mij.
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ring in Indonesi, 19001942. PhD diss., Leiden University.
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Ithaca: Cornell University.
Nederburgh, I.A. (1903) Recht van Nederlandsch-Indi. dl. 80.
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. 1981. Peranakan Chinese Politics in Java 19171942. Singapore: Singapore Uni-
versity Press.
Tjiook-Liem, Patricia, 2009. De rechtspositie der Chinezen in Nederlands-Indi 18481942,
Wetgevingsbeleid tussen beginsel en belang, PhD diss., LUP Dissertations, Leiden Univer-
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in Indonesia, 19001916. Illinois: Glencoe.
PART IV
SURVIVAL AND CREATIVITY:

CHINESE BUSINESS RESPONSES TO REGIME CHANGE
CHAPTER SEVEN
CRISIS MANAGEMENT AND CREATIVE ADJUSTMENT:

MARGO-REDJO IN THE 1930s
Alexander Claver
Introduction
In 1931 the International Colonial Exhibition was held in Bois de Vin-

cennes near Paris. The Netherlands spent nearly 2.5 million guilders
on a magnificent pavilion, which shows how much the Dutch gov-
ernment valued its colonial image even at a time of severe economic
distress. In portraying the Netherlands Indies special emphasis was
placed on the colonys economic achievements. Visitors were informed
about the different means of transportation, the road and railway net-
work, the density of telephone, telegraph, and postal services, as well
as the electricity grid. Attention was also paid to such topics as export
agriculture, money and finance, engineering, the trade balance, etc.
The Dutch made creative use of sophisticated means of representa-
tion, such as illuminated maps with motion indicators, stuffed animals
and colorful dioramas. The so-called stairs of abundance (trap des
overvloeds) was one successful example as the worldwide distribution of
the colonys export produce was symbolized by little figurines each
carrying a product down the stairs. With a map of the Indonesian
archipelago as the dioramas point of departure, the figures multiplied
before reaching a map of the world, their symbolic destination. This
forcefulthough rather misleadingimpression of affluence illus-
trated the many economic accomplishments of the Netherlands Indies
(Bloembergen 2002, 271316; Taselaar 1998, 348358).1
However, it was neither an accurate nor truthful depiction of the
actual state of affairs, because at the beginning of the 1930s world
1
It therefore seems rather symbolic, that on June 28, 1931 the Dutch colonial
pavilion burned to the ground. The decision to rebuild was quickly made and in a
tour de force a new, though far less conspicuous, pavilion was constructed and offi-
cially opened on August 17.
142 alexander claver
market prices had plunged as a result of the worldwide economic

crisis. With the income of the Netherlands Indies determined largely
by export revenues, economic decline had almost immediately set
in, forcing the colonial government to re-enter the economic scene
after decades of abstinence. Trading enterprises were severely hit by
the steep fall in prices, and the resulting sharp decline of turnover
threatened their profitability and even survival. A return to prosper-
ity seemed at hand with improved economic conditions after 1936.
Unfortunately, within a few years political turbulence in Europe and
Asia put an end to the economic recovery of the Netherlands Indies.
The economic depression of the 1930s encouraged the imposition of
a range of trade barriers, as import regulations and initiatives aimed at
economic autarky were speedily implemented. International trade was
crippled. The commercial relationships of the preceding decades were
increasingly difficult to maintain, as evidenced by the measures taken
by the colonial administration against the encroachment of Japanese
business. But traders could not rely on government support alone.
A more professional business organization was needed to meet the
requirements of a commercial sector faced with global market forces
beyond control. The basis of the colonial trading system itselfthe
delicate balance between the different (ethnic) participantswas, how-
ever, not fundamentally altered. Cooperation remained crucial and,
as will be seen in the following pages, this was well understood by all
parties involved.
This chapter describes the business experience and survival strategy
of Margo-Redjo (a Chinese-owned coffee company based in Sema-
rang) during the economic crisis of the 1930s. The severe worldwide
economic crisis constituted a regime change which seriously affected
peoples everyday life. The Chinese living and working in the Indies
archipelago were forced to deal with significant changeswhether
political, economic, legal or socio-culturalin the system, administra-
tion and/or institutions surrounding them. This confronted entrepre-
neurs with major problems and left them little room for maneuver.
However, the range of possibilities differed strongly between firms.
Large wealthy companies could employ survival strategies unavailable
to those with less capital at their disposal. The example of Margo-
Redjo shows how a smaller Chinese-owned enterprise survived the
crisis by analyzing its business environment and adopting a clever
marketing policy.
crisis management and creative adjustment 143
Before focusing in detail on the adjustment of Margo-Redjo, some

information concerning the economic depression of the 1930s will be
given with special reference to the economic situation of the Nether-
lands Indies within a changing global environment. This is followed
by a section on the policy response of the Dutch colonial administra-
tion. A response aimed at achieving greater economic independence
as a result of the encroachment of Japanese business and worldwide
economic protectionism. Against this background the survival strategy
of Margo-Redjo is described and analyzed in detail, in an attempt to
show the versatility and creativity of entrepreneurial conduct in times
of crisis.
Reversal of Fortune: The Economic Experience of the 1930s
In October 1929, the New York Stock Exchange on Wall Street col-
lapsed with devastating economic consequences. From 1929 till 1932,
Wall Streets industrial stock would lose about eighty-two percent of its
value, accompanied by a drop in Americas industrial output of no less
than fifty-four percent. ([Atlas] 1987 II, 145). The severity of the crash
shook peoples confidence in the real economy, which manifested itself
in declining orders and investment. The resulting economic contrac-
tion accelerated the existing decline in commodity prices. Since the
late 1920s a serious oversupply of primary commodities, such as rub-
ber and sugar, had started to affect world market prices long before
Wall Street tumbled. With no effective means of price restoration at
their disposal producers had sought to compensate for the resulting
loss of revenue by raising output. Though understandable, this strat-
egy merely served to exacerbate the existing fall in prices and when
world demand shrank due to the Wall Street crash the impact on
commodity prices proved disastrous.2
In the case of the Netherlands Indies, export prices fell by 7.1 per-
cent annually between 1920 and 1928 (See Tables 1 and 2). However,
export volumes rose by 7.7 percent over the same period, while the
2
The economic crisis of the 1930s and its impact on the economies of Southeast
Asia, including the Netherlands Indies, have been well documented. The following
publications provide an excellent introduction: Boomgaard (2000), Booth (1998, 3947,
10516, 15461, 20322), Dick et al. (2002, 15362), Taselaar (1998, 363422).
Table 1. Annual Average Growth in Major Economic Aggregates,

18741940
Period GDP Export Money Terms
(per capita) volume supply1 of
trade2
18741900 3.1 2.7 4.2
18851900 3.9 1.6 4.1
19011928 1.7 5.8 3.6 5.3
19201928 2.3 7.7 4.8 6.8
19281934 3.4 3.9 2.2 6.9
19341940 2.5 2.2 3.8 2.2
1
coins, notes, and bank deposits.
2
indicating the relationship between export and import prices.
Source: Booth (1998, 18).
colonys terms of trade continued to improve by an average of 6.8

percent. (In other words, prices for imports fell even more than for
exports.) At the beginning of the 1930s commodity prices took a real
nose-dive. From 1928 till 1934 export prices fell by almost twenty
percent on an annual basis. The decline was so steep thatdespite
falling import pricesthe colonys terms of trade then turned nega-
tive, decreasing 6.9 percent on average. In addition, there was no pro-
duction growth to balance the difference, since export volume fell by
3.9 percent during these years. The economic crisis was also apparent
in the colonys money supply, which declined by 2.2 percent, clearly
reflecting the reduced number of money transactions within the col-
ony. These indicators point to a general decline in economic output.
This conclusion is supported by a fall in GDP per capita of 3.4 percent
between 1928 and 1934, in sharp contrast with the increase in GDP
of 2.3 percent during the period 192028 (Booth 1998, 18).
Heavily dependent on the export of primary products, the Nether-
lands Indies economy was very vulnerable to price fluctuations. Rub-
ber and sugar alone accounted for fifty-two percent of total export
earnings in 1925. This figure breaks down into thirty-two percent for
rubber and twenty percent for sugar, representing a money value of
582,210,000 guilders and 367,312,000 guilders respectively. How-
ever, by 1932 rubber exports were only a mere five percent of the
peak value in 1925. Sugar experienced an equally dramatic price fall
between 1923 and 1934 with a drop in value of eighty-seven percent.
Table 2. Price Index Numbers, 18701940 (1913=100)

Import Export Freights World market
products products prices
x s x s x s x s
18701879 232 17 126 14 329 24 115 9
18801889 155 15 115 32 191 50 90 9
18901899 113 11 105 13 86 28 78 6
19001909 108 7 84 7 58 34 86 5
19101919 150 47 135 45 744 140 145 39
19201929 182 24 234 44 164 51 168 26
19301940 95 23 61 28 110 27 106 10
x = average index number.
s = standard deviation indicating the relative importance of the fluctuations
[expressed as percentage of the average index numbers].
Source: Korthals Altes (1994, 15, 159166).
Increasing output failed to absorb these downward price movements.

Between 1925 and 1929, rubber production increased by twenty-four
percent, whereas export values fell by sixty percent. Sugar production
expanded no less than fifty-two percent during the period 192329,
but total export value nonetheless decreased by thirty-eight percent. In
the early 1930s production increases were finally dismissed as a way of
maintaining revenue. In 1932, the output of rubber had fallen twenty
percent, while sugar output was fifty-three percent lower in 1934.3
The most striking feature of the crisis of the 1930s was the loss in
value of the colonys most important export commodities, i.e. sugar,
rubber, tobacco, copra, and oil (Korthals Altes 1991, 20). In 1925 the
export of these commodities accounted for no less than 75.2 percent
of total export earnings (Booth 1998, 208). Compared to the average
price level of the 1920s, export prices dropped to twenty-six percent
during the 1930s (Korthals Altes 1994, 19) (See Table 2). As a result,
total export value during the first half of the 1930s completely col-
lapsed and only started to recover after 1935 (See Table 3 and Figure
1). When corrected for the extreme fall in commodity prices the export
economy kept performing reasonably well until 1932, only to fall back
and stabilize around the 1913 level during the late 1930s. This was
3
See Dick et al. (2002, 155), Van der Eng (1993, 202205), Khudori (2005, 21,
346), Lindblad (1988, 2789, 2869), Lindblad (2000, 132).
Table 3. Imports and Exports of Java and Madura, 19291940:

Values (at constant prices x 1,000) and Index Numbers (1913=100)
Import Export
Real Real
Value value1 Value value1
1929 717,784 220 475,354 146 714,916 203 525,674 149

1930 568,327 175 400,230 123 572,407 163 629,019 179
1931 411,045 126 367,004 113 379,667 108 666,082 189
1932 262,314 81 291,460 89 299,827 85 749,568 213
1933 224,075 69 312,917 96 226,499 64 612,159 174
1934 193,165 59 261,034 80 215,435 61 478,744 136
1935 179,182 55 248,864 76 191,681 55 425,958 121
1936 183,637 56 248,158 76 211,445 60 358,381 102
1937 317,733 98 324,217 100 298,232 85 363,809 103
1938 319,308 98 339,689 104 230,608 66 397,600 113
1939 360,078 111 379,029 116 278,395 79 371,193 106
1940 299,246 92 264,819 81 294,353 84 387,307 110
1
deflated import and export values.
Source: Korthals Altes (1991, 4656, 6675), Korthals Altes (1994, 15966).
mainly due to the delayed reduction of the high production levels for
sugar and rubber.
Total import values, whether measured in current or real prices,
likewise dropped and did not bottom out until 1935 (See Table 3 and
Figure 1). When compared to the preceding decade, import prices
on average nearly halved during the 1930s (Korthals Altes 1994, 19)
(See Table 2). In 1934, for instance, the Batavia cost of living index
was only fifty-eight percent of its 1928 value, whereas the rural Java
food price index stood at forty-one percent (Booth 1998, 40; Dick et
al. 2002, 156). This remarkable price fall partly restored international
competitiveness and helped cushion the decline in income of the popu-
lation. The explanation given for the rapid deflation is the adherence
of the Dutch to the gold standard until 1936. According to Booth, a
sharp internal deflation was the only way to bring about the neces-
sary real depreciation of the guilder, when faced with deteriorating
terms of trade and a nominal appreciation in the exchange rate (Booth
1998, 40).4
4
More information concerning the adherence to the gold standard in The Neth-
erlands can be found in Griffiths (1987) and Korthals Altes (1979). The colonial
250
200
Index numbers
150
100
50
0
1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940
Years
Import Import (deflated) Export Export (deflated)
(1913=100)
Figure 1. Index numbers of imports and exports, Java and Madura

19291942.
Source: Table 3.
From the mid-1930s onward, the economy of the Netherlands Indies

started to show distinct signs of recovery (Boomgaard and Brown 2000,
45) (See Table 1). Export prices improved by 7.8 percent annually
after 1934, accompanied by a growth in export volume of 2.2 percent.
The colonys terms of trade once again turned positive and would
remain so for the rest of the decade. Business transactions and invest-
ment picked up strongly as indicated by an average increase in the
money supply of 3.8 percent. The rapid resurgence of the economy
also manifested itself in a significant rise of GDP per capita of 2.5
percent per year during the period 193440 (Booth 1998, 18).
This change of fortune can be attributed to the following factors.
First, food crop agriculture performed well during the latter part of
the decade as did smallholder production of important cash crops;
especially rubber. Second, international conditions slowly improved.
stance regarding this issue is detailed by Taselaar in his study on the Dutch colonial
lobby (Taselaar 1998, 37180).
When demand from the industrialized countries started to rise again,

world market prices improved and with it the Netherlands Indies
economy. Third, the partial economic recovery was aided by the
growth in industrial output. Between 1931 and 1939 the contribu-
tion of manufacturing to GDP jumped from eight percent to twelve.
A development closely linked to the Dutch reaction to the success of
Japanese business at the height of the crisis (Booth 1998, 413, 467,
86; Dick et al. 2002, 161).
Japanese Threat and Dutch Response
Industrialization and the so-called Japanese threat constituted the

two main themes of the administrations economic policy during
the 1930s. The latter, however, received far more public attention
as the economic strength of the Japanese was increasingly consid-
ered a threat to the colonial economic and political system.5 Japanese
trade had boomed during the First World War: the countrys share
of imports into the Netherlands Indies climbed from two percent in
1914 to twenty-two percent in 1918. After the end of the war, this
percentage would drop to eight percent by 1922, only to climb back to
twelve percent at the end of the decade. From 1928 onward, Japanese
exports to the Netherlands Indies experienced a vigorous growth, soar-
ing to a peak of thirty-two percent in 1934, at which point it nearly
exceeded combined imports from European countries.
Japan owed this achievement to the fact that it manufactured a
range of consumer goods, such as garments, household utensils, and
bicycles. This was especially true of textiles and garments after the Jap-
anese textile industry managed to reduce its production costs through
the adoption of new technologies (Booth 1998, 20910). These were
popular as they were cheap and appealed to indigenous taste. In addi-
tion, during the 1920s and 1930s, Japanese companies built up their
own marketing and distribution network throughout the Indonesian
5
See Post (1991, Chapter 7 and 9) for the Japanese economic activity in the Neth-
erlands Indies during the 1930s. Of special interest are also the articles published by
Dick (1989) and Booth (1994). More information regarding the political implications
of the Japanese presence in the colony is provided by De Graaff (1997, 26070). Japa-
nese espionage activities are dealt with in Haslach (1985, especially 10733, 1512,
1745).
archipelago, aided by the economic ties with the Chinese business

community. This allowed them to operate independently and develop
a business strategy based upon a large clientele and characterized by
rapid turnover and small profits.
The lasting importance of Chinese networks for Japans economic
expansion in Southeast Asia should not be obscured. Japanese compa-
nies continued to work closely together with influential business groups
within the Chinese commercial community. These personalized Japa-
nese-Chinese economic networks, established prior to and during the
First World War, had a positive effect on Japans economic advance
throughout the 1920s and 1930s (Fukuda Shozo 1995, 22846, espe-
cially 2289; Post 1995 and 2004). Equally positive was the devalua-
tion of the yen against the guilder by almost sixty percent in December
1931. Thereafter, Japanese products became even more sought-after.
As a result, Japanese business clientele multiplied which helped increase
turnover and simultaneously spread the commercial risk (Booth 1998,
20911; Dick 1989, 2513; Dick et al. 2002, 1589).
At first, the reaction to the ongoing encroachment of Japanese busi-
ness was rather mild. In the eyes of the administration, cheap Japanese
imports provided a fortuitous cushion against falling living standards.
Likewise, the deficit in bilateral trade with Japan, aggravated by lag-
ging Japanese demand for the colonys exports, was not considered
particularly disturbing. However, this attitude was replaced by a deep
concern for the loss of the colonial export market for Dutch products
and the growing threat of the Japanese presence to the colonial dis-
tribution system.
The response was the Crisisinvoerordonnantie (Crisis Import Ordinance)
of September 1933, which allowed the government to impose import
quotas and discriminate by country of origin. Regulation also took the
form of import banswith rice being the most important commodity
to be protected by a banand widespread price control. This com-
plex system of restrictions would ultimately affect almost forty percent
of all imports. Although officially denied, these measures were primar-
ily intended to reduce Japanese imports. This goal was achieved by
1937, when Japans overall share of imports had been cut successfully
from thirty-two to fifteen percent.6
6
See Booth (1998, 21921), Dick (1989, 253), Dick et al. (2002, 1589), Fukuda
Shozo (1995, 13545), Panglaykim (1963, 812).
The Japanese protested fiercely against these measures, which

resulted in tough and protracted trade negotiations between 1934 and
1937. Besides reducing Japans import share, two more issues were at
stake. In an attempt to rein in the Japanese system of direct distribu-
tion the Dutch insisted that no more than twenty-five percent of Japa-
nese imports be handled through Japanese living in the Netherlands
Indies. In addition, they also objected to the growing share of Japanese
shipping on the route between Japan and the Indies archipelago. The
diplomatic bickering concerning these topics finally led to the con-
clusion of three agreements: a shipping agreement in 1936 and two
trade agreements in 1937 (the Hart-Ishizawa agreement) and 1938
(the Van Mook-Kotani agreement). On the whole, these agreements
benefited the Dutch more than the Japanese. Renewed negotiations,
lasting from September 1940 till June 1941, ultimately failed because
of the extreme demands put forward by the Japanese.7
The export sector did not escape regulation either. Apart from the
dramatic slump in export prices, the 1930s saw a curtailment of tra-
ditional export markets due to worldwide protectionism. Since The
Netherlands failed to provide a substantial market for the colonys
products, most Netherlands Indies exports were sold in unprotected
markets and therefore price sensitive. These unfavorable circumstances
forced the Dutch to reconsider their economic policy and persuaded
them to embark on a strategy of production restriction in an attempt
to make the colonial economy less vulnerable to price fluctuations on
the world market. The domestic production of export crops was regu-
lated either unilaterally (kapok, cinchona, coffee, and copra), or by
joining international commodity stabilization programs (sugar, rubber,
tea, and tin). Although the outcome of these different schemes varied
considerably, each had a profound impact on the lives of all those
involved. The harsh restrictions turned out to have far-reaching conse-
quences for both the European and the indigenous population.8
7
See Duynstee (1980, 14854), De Graaff (1997, 2678), Haslach (1985, 8490, 99,
1448, 1567, 1647), De Jong (1984 Vol. 11a, 6716), Post (1991, 2458), Taselaar
(1998, 41012).
8
A first-hand account of this confrontation can be found in a curious, yet very
interesting book entitled Indisch getij, Hollandsche bakens. Through an intriguing blend
of fiction and non-fiction the authorsA. Voortland and W.G.N. de Keizeroffer a
fascinating glimpse of the economic hardship people had to endure during the 1930s
and the bitter sacrifices they were obliged to make (Voortland and De Keizer 1944).
Sugar provides a good example of the depressed situation of the

1930s. As a result of the crisis the sugar importing countries intro-
duced measures to safeguard their high-cost producers of beet sugar
against the competition of cheap cane sugar. Java as an exporter was
especially vulnerable, for the small size of the Dutch market meant
that it was heavily dependent on unhampered international trade.
When, in addition, China, Japan, and Indiatraditionally the main
buyers of Javanese sugarstarted to protect their markets by means
of import regulations, the industry found itself in dire straits (Wiseman
2001, 216312).
In 1932 the international Chadbourne Scheme was agreed upon,
which allotted to each participating country a sugar export quota and
provided for a reduction in the acreage of sugar worldwide. However,
the agreement did not include the British Empire, the United States,
Japan, and the Soviet Union and it therefore failed to achieve the
results hoped for. In 1937 the International Sugar Council was set
up to allocate export quotas and the fortunes of the industry slowly
improved, although this was partly attributable to stockpiling caused
by the threat of war, rather than to the restrictive measures ([ Java-
suiker] 19321933).
Intervention of this kind signaled the end of the colonys traditional
free trade policy and initiated a strategy of domestic self-sufficiency
by means of import substitution and industrialization. The authorities
started to actively support industrial development by initiating capital
works programs and establishing research centers to upgrade technol-
ogy and management. In the meantime, the protection offered by the
new trade regulations contributed significantly to the rapid diffusion of
modern technologies.9
The textile industry around Bandung profited strongly from these
efforts, which resulted in a significant modernization of the sector. With
the help of a strong demand for locally woven sarongs, the number of
modern handlooms rose spectacularly from 500 in 1930 to 49,000 in
1941. Most industrial activity, however, was drawn to Batavia, where
several new industries were established, including automobiles (Gen-
eral Motors), rubber tires (Goodyear), margarine (Unilever), and shoes
9
See Booth (1998, 156, 21819), Dick et al. (2002, 159), Hacco (1947, 1730,
14154, 21556), Sato (2004, 21), Taselaar (1998, 380400, 47283), Voortland and
De Keizer (1944, 8899).
(Bata). Other projects initiated in the late 1930s included the produc-
tion of consumer goods (light bulbs, bicycles, rubber sandals, metal
fittings, and soap).
The late colonial industrialization achieved some degree of import
substitution, but only in a narrow range of mainly consumer goods.10
It was only after the occupation of The Netherlands by the Germans
in 1940 that domestic demand was shifted to local heavy industry. For
two years, the metal, machinery, and chemical industries operated at
full capacity, because of government contracts in anticipation of war
with Japan. In addition, a crash program for the development of heavy
industry was announced, which aimed to free the Netherlands Indies
from dependence on foreign supplies of essential industrial inputs.
Unfortunately, many of the projects under consideration had barely
left the drawing board when the Pacific War broke out in 1942 and
none would ever be completed.
Margo-Redjo11
Since the crisis of the 1930s left companies little room to maneuver,
they had to formulate a survival strategy which explored all the lee-
way management could find. With the exception of companies like
Internatioone of the largest general trading houses in the colony
most entrepreneurs had little or no capital at their disposal and there-
fore could not afford the costly reorganization and investment strategy
chosen by their giant counterpart.12 They had to look for other, less
expensive options within their more limited range of possibilities.
The coffee firm Margo-Redjo in Semarang, Central Java, provides
an interesting example of how a smaller enterprise dealt with the
problems it encountered. (See Box 1) Margo-Redjo was owned by the
10
See Booth (1998, 1567), Dick et al. (2002, 15962), Keppy (2001, 3540),
Segers (1987, 2738).
11
The following section is based upon research of the private archive of Margo-
Redjo kept in Semarang for which permission was kindly granted by W.B. Dharmowi-
yono (Tan Tjoan Pie). More information was obtained during three interviews held
with W.B. Dharmowiyono on June 19, 1999, December 4 and December 13, 1999.
Additional information was provided by Tan Tjoan Ik in an interview conducted
on October 18, 2000 and W.W. Dharmowiyono (Tan Swie Ing) in a letter dated
November 11, 2005.
12
The survival strategy of Internatio during the 1930s can be found in detail in
Claver (2006, 37180) and Claver (2007, 30526).
Chinese entrepreneur Tan Tiong Ie, a distant descendant of a certain

Tan Bing who had arrived in Java at the end of the eighteenth century
(Claver 2006, 602).13 Tan Tiong Ie was born in 1883 in Semarang
where he went to a Hokkien school to receive a Chinese education.
Initially, he ventured into the salt business, but according to family
history this business endeavor failed. The government salt lease he had
acquired left him completely broke. According to the family history,
his debts were so large that he even contemplated going to prison
voluntarily. Fortunately, loans from friends and acquaintances helped
him repay his debts and saved him from serving jail time.
He then took his family to Bandung, West Java, to start over in all
anonymity. Initially, he operated a small bakery and wood business
which met with little success. However, the family could make ends
meet and in 1916 he decided to try his hand in coffee by establish-
ing the Eerste Bandoengsche Electrische Koffiebranderij Margo-Redjo. After a
number of years, Tan Tiong Ie returned to Semarang with his busi-
ness. The small ice factory he subsequently founded would not make
him rich, but in the end Margo-Redjo turned out to be his stroke of
luck.
Margo-RedjoJavanese for prosperous road14was active both
in coffee production and coffee trade. The company roasted coffee
beans, packaged the finished product, and subsequently sold the coffee
to wholesale and retail traders. Since no account books appear to have
survived, nothing can be said about the companys establishment and/
or growth. No data exist concerning the first two decades of its exis-
tence. How the necessary starting and working capital was obtained
remains unknown. The interviews conducted with family members
suggest two possible scenarios which, unfortunately, cannot be veri-
fied. First, family members of Tan Tiong Ies wife, who came from
the wealthy Kwee family in Ambarawa, Central Java, might have
13
This assertion is confirmed by two genealogies of the Tan family in possession of
the author, which were kindly provided by Tan Tjoan Ik and Kwee Hui Kian, respec-
tively. See also Tan Tjoan Iks personal account Op zoek naar Tan Bing (In search of
Tan Bing) written in 2002. His account can be found in the library of the Koninklijk
Instituut voor Taal-, Land- en Volkenkunde (KITLV) in Leiden.
14
See Vleming (1926, 258) for the Chinese practice of giving enterprises and
brands a well-sounding name. The fact that Tan Tiong Ie selected a Javanese name
for his company appears to have been a deliberate choice. From a marketing point of
view, the name Margo-Redjo certainly served its purpose, since the company catered
predominantly to the Javanese population during the first years of its existence.
furnished the capital needed. Second, Tan Tiong Ie might have

obtained a substantial bank loan, although this last option seems less
likely. It would have required some sort of collateral, which sharply
contradicts Tan Tiong Ies sorrowful financial state at the time.
Box 1. Margo-Redjo.
Source: Private archive Margo-Redjo.
Notwithstanding these questions, Margo-Redjo turned out to be more

than successful. In the 1920s, Tan Liang Hoone of Tan Tiong Ies
sonscould study law in Leiden at one of the most prestigious univer-
sities in The Netherlands. Tan Tiong Ie himself earned an entry into a
Whos Who of well-known Chinese entrepreneurs in Java published in
1935, which portrayed him as the first Chinese entrepreneur to export
coffee to other countries. According to the entry, this export business
amounted to one million kilos of coffee each year (Orang-orang Tiong-
hoa 1935, 142). Margo-Redjo had by then become the largest coffee
roaster in Java employing tens of laborers.
How did Margo-Redjo manage to achieve this at a time of severe
economic distress?15 Since Tan Tiong Ie had started from scratch and
did not operate other businessesdisregarding a hardly profitable ice
factoryit seems unlikely that he had large capital funds at his dis-
posal. Surviving letters indicate that the Nederlandsch-Indische Escompto
Maatschappij (NIEM) financed some of his business, but only for small
amounts. The Borneo-Sumatra-Handel-Maatschappij (Borsumij) was
among Margo-Redjos coffee bean suppliers, and though some money
might have been advanced, there is no reason to assume that huge
sums were involved. However, the small archive still in the familys
possession gives another possible explanation for Margo-Redjos suc-
cess during a period of economic hardship.
The key to the companys success appears to have been its clever
marketing strategy, of which Tan Liang Ho was the driving force. He
had a keen interest in production and marketing techniques, and kept
himself informed of the latest developments by buying specialist maga-
zines and books. He also came up with original and creative ideas
for marketing and public relation campaigns. The private archive of
Margo-Redjo contains many notes as well as sketches of new adver-
tisements, flyers, and posters he evidently drew himself.
The results of his ideas and efforts were manifold. First, Margo-
Redjo produced different qualities of coffee, which were sold under
different brand names. The lesser the quality, the cheaper the brand.
Tjap Grobak Idjo was the cheapest, while Tjap Margo-Redjo was the most
expensive. In between there were other brands, such as Tjap Pisau, Tjap
15
Naturally, the crisis also affected Margo-Redjo since another son of Tan Tiong
Ie was forced to leave the company and had to seek employment elsewhere during
the years 193035.
Orang-Matjoel, Koffie Sentoso, Koffie Mirama, and Koffie Sari-Roso (See Box 5
for an example). Second, Margo-Redjo stressed the fact that it custom-
ized the packaging size of its coffee. After all, the needs of wholesale
traders, retail traders, and individual customers strongly differed. This
proved a strong point since this strategy was not yet common practice.
Third, the distribution network of Margo-Redjo was well developed.
Not only did it reach as far as Singapore, Makasar, and Lampung, but
in Java especially it reached the smallest of places. This was seen as
an important factor in the companys success. Moreover, retail traders
received their order with special labels giving their names, so that each
package sold added to their reputation as well.
Finally, Margo-Redjo put much time and effort into advertising its
different products, placing ads in newspapers, participating in exhibi-
tions, etc. But more was required in order to build a relationship with
the customer in the street. Retail traders were therefore encouraged to
combine sales by promising customers a free item, such as milk, when
they bought one of Margo-Redjos brands. Another tactic was to hand
out a coupon whenever a customer bought a specific brand; five cou-
pons earned the customer a tea cup, seventy-five coupons a kebaja, 150
coupons obtained a kain batik aloes, or a very fine piece of dyed batik
cloth, and so on. At the Pasar Malam held in Semarang in 1930, a
contest was organized offering a price of one hundred guilders for the
person that had collected most labels of Tjap Orang-Matjoel.
By using these methods Margo-Redjo enhanced its reputation and
increased its turnover. Given the small margins on coffee, profitability
rested primarily upon a high sales level. Maintaining this was of the
utmost importance, and the marketing strategy aimed to do just that.
The more people knew about Margo-Redjos coffee and the more they
appreciated its quality, the more coffee would be sold. After all, many
purchases of relatively small amounts would boost sales and thereby
help achieve sufficient turnover. Though lacking the financial resources
of companies like Internatio, Margo-Redjos creativity thus paid off.
Colonial Marketing and Sales Techniques
This well-designed marketing strategy put Margo-Redjo in the fore-

front of a development that was slowly changing the way of doing
business in the Netherlands Indies. The importance of building a rela-
tionship with (potential) customers had always been acknowledged by
businessmen, especially in the trading sector where competition was

particularly intense. It was a well-established strategy to protect sales
figures. However, the aim of increasing turnover by matching product
and client through a concerted marketing effort was something new,
which received special impetus in the 1930s because of the prevalent
economic crisis. With less and less money to spend, consumers needed
to be enticed into the shop and convinced that they could not make
a better buy anywhere else. However, simply advertising the existence
and/or superior quality of certain products, while occasionally offering
discounts, would not do the trick. Catering to the needs of the con-
sumer at a time of economic hardship required a complete marketing
concept, which necessitated a break with past business methods as well
as a different mentality.
During the 1930s Japanese retail traders in Java excelled at this new
marketing approach, to their great benefit. Their remarkable success
was met with a mixture of fear and curiosity on part of the Chinese
and Dutch business communities. To assess the changing situation,
Internatios management ordered an investigation into the activities
of Japanese retail traders in Java.16 E.F.J. Nater and W. Folkers
deputy managers at the Batavia officewere assigned this task, and
traveled all over Java to conduct interviews with Chinese and Japanese
businessmen alike. In June 1933 they submitted their report in which
they made several interesting observations. According to them, Japa-
nese shops managed to attract more public for a number of reasons,
such as the use of alluring displays, a bigger choice of products, and
low fixed prices. More aware of the need to appeal to the taste of the
consumer, Japanese shopkeepers actively searched for the right combi-
nation, concentrating on the needs and wishes of potential customers
in order to get as many people as possible to pass their doorstep. Chi-
nese shopkeepers took a more passive stance, convinced that custom-
ers would come to their store anyhow.
As a result of these differing attitudes, Japanese shops differed
sharply from Chinese. Most Chinese shop houses were rather scruffy,
badly maintained, and hardly inviting. Inside, chaos loomed as prod-
ucts were piled haphazardly, making it impossible for customers to
move freely and look at the merchandise before deciding what to buy.
Frequently, goods were unavailable as stocks were only replenished
16
Bank Indonesia, Archive of De Javasche Bank, 3354 No. 28.
when they had run out. In addition, prices often needed to be negoti-
ated. By contrast, the Japanese shop looked neat and clean. Goods
were priced and usually displayed in windows and glass cases, allowing
the customer to walk around and get an idea of the available products.
Furthermore, most Japanese shopkeepers sold their merchandise at
fixed prices and, if possible, kept large stocks (Post 1991, 2523, 255;
Post 1993, 149; Post 1996, 3079).
These visible distinctions were very important, but Nater and Folk-
ers also stressed that the Japanese business mentality fitted the prevail-
ing economic conditions better than the Chinese. According to one of
their Japanese interviewees, Chinese shopkeepers were primarily inter-
ested in making a quick profit. When a potential client entered their
shops they would immediately ask themselves how much he or she
might be worth and whether or not he or she was aware of the prevail-
ing prices. The Japanese, on the other hand, followed a different tactic.
They focused on winning the trust of all their clients, including the
smallest ones.17 After all, a customer buying for only a cent could come
back another day with more than one cent in his pocket. The ambi-
ance of the shop (neat and clean with goods displayed attractively)
and the fact that prices were fixed were of crucial importance in earn-
ing this trust. As a result, Japanese shops attracted many customers,
mostly at the expense of the Chinese, at a time when every client was
highly valued in order to keep turnover high.
The fact that Japanese retailers did much better than their Chi-
nese counterparts was swiftly recognized, but initially their example
was hardly followed. Although complaining loudly, the Chinese busi-
ness community was slow to react. Many voiced the opinion that little
could be done against the Japanese since they were part of a giant
organization supported by the Japanese government.18 This conspiracy
theory fitted the growing general attitude in the Netherlands Indies
which considered every Japanese citizen a potential spy (Haslach
1985, 10733, especially 1256; Post 1991, 2434). In addition, at the
height of the crisis most Chinese businessmen were more concerned
17
As early as June 17, 1922, the Batavia newspaper Kabar Perniagaan criticized the
surliness and indifference with which the Chinese treated their customers contrary to
the Japanese who attracted much more consumersespecially from the indigenous
populationbecause of their friendliness (Arsip Nasional Republik Indonesia/Archive
Binnenlandsch Bestuur 656 Nr. V).
18
Ibid.
with surviving the economic slump than dealing with growing Japa-
nese competition.
Still, there were exceptions to this rule as the case of Margo-Redjo
clearly shows. Another example of a change in Chinese business per-
ception can be found in the publication of a new magazine in Batavia
by Liem Kha Tong in 1932: Maandblad Reclame & Efficiency Dagang,
or Monthly Magazine for Advertising & Efficiency in Trade. (See
Box 2)
RECLAME & EFFICIENCY DAGANG

Soerat kabar boelanan boeat sasoeatoe orang jang ingin madjoe dan dapet succes die
Doenia Dagangan, Peroesahan dan Pengidoepan. Boeat besarken Kaoentoengan! Mad-
joeken Peroesahan! Tambah Pendjoealan! Dapetken Langganan-langganan baroe!
Ketjilken Onkos-onkos! Tambah Kehasilan!
ADVERTISING AND EFFICIENCY IN TRADE

A monthly magazine for the person that wants to move ahead and become
successful in the World of Trade, in Business and in Life. Increase your
profit! Advance your Business! Increase sales! Get new Customers! Decrease
your Costs! More Result!
In January 1933 the name and subtitle of the magazine were changed
into:
EFFICIENCY
Maandblad boeat orang-orang jang Actief.
Efficiency (batja: ef-fi-si-en-si) adalah Pengetahoean jang paling baroe, jang toedjoean-
nja: dengen tenaga atawa onkos jang paling ringan, dapetken hasil jang paling besar.
Efficiency perloe digoenaken dalem Pengidoepan dan Perdagangan boeat dapetken: Suc-
ces, Keoentoengan, Kemadjoean dan Kebroentoengan.
EFFICIENCY
A monthly magazine for Active people.
Efficiency (read: ef-fi-si-en-si) is the latest Knowledge with the purpose
of achieving the best result with the least energy and cost. Efficiency is
needed in Life and Trade in order to achieve: Success, Profit, Progress
and Luck.
Box 2. Names and subtitles of Efficiency magazine.

Source: Efficiency, 1932, 1933, and March 1937.
The magazine offered its readers articles on marketing and finance,

with the aim of informing them of the latest developments and newest
insights in salesmanship, window dressing, personnel training, efficient
management, etc. [. . .]. (Orang-orang Tionghoa 1935, 199200).19 For
instance, advice was given on how to improve the lighting of products
within a shop. In the words of Liem Kha Tong: Penerangan jang baek bisa
bantoe menambah pendjoealan [. . .] Di bawah ini ada 12 nasehat boeat perbaekin
penerangan dalem toko. (Good illumination can help to increase turnover
[. . .] Below are 12 tips on how to improve the illumination inside the
shop.).20 Other series of articles focused on the acquisition of capital
for trading purposes, the increase of turnover as an important source
of profit, or how small shops could maintain profitability and carve out
an existence alongside the larger department stores.21
Wholesale traders took note of these new initiatives. As we have
seen, Internatio investigated the success of Japanese retailers. Geo.
Wehry & Co. (like Internatio counted among the largest general trad-
ing companies of the Netherlands Indies) took a different approach
by actively encouraging its clients, i.e. Chinese retail traders, to mod-
ernize their business along the lines described in Efficiency, starting its
own trade magazine with the name Geo. Wehry & Co. Tsa Chih in
January 1933. (See Box 3)
GEO. WEHRY & CO. TSA CHIH

Soerat-kabar jang diterbitken 14 hari sekali oleh firma Geo. Wehry & Co. goena men-
genalken itoe perhoeboengan persobatan dengen iapoenja sobat2 dan
langganan-langganan.
GEO. WEHRY & CO. TSA CHIH

A magazine published every two weeks by the firm Geo. Wehry & Co.
to show the friendly relations it possesses with friends and long-standing
customers.
Box 3. Name and subtitle of Geo. Wehrys trade magazine.

Source: Geo. Wehry & Co. Tsa Chih, I 1 ( January 1933).
19
Maandblad Efficiency, March 1935.
20
Ibid. October 1934.
21
Ibid. March 1935, April 1935 and May 1935.
Unsurprisingly, the first issue opened with an article on retail trade:

Sedikit Nasehat oentoek Perdagangan Etjeran (Some Tips regarding Retail
Trade).22 According to the unknown author, retail trade constituted
the most important field of work for the Chinese, and one in which
they had held a monopoly for many centuries. However, lately there
had been signs of change and a strong warning was issued:
Biarpoen detailhandel sekarang boeat bagian jang paling besar masih berada dalem
tangan Tionghoa, toch soeda kanjataan, bahoea itoe monopolie jang doeloe begitoe
tegoeh, skarang soedah moelai goempoer. Bangsa Indonesier, bangsa Blanda, dan tero-
etama bangsa Djepang, sekarang lagi bergiat boeat mendapatken kadoedoekan boeat
karoegiannja bangsa Tionghoa.
Although the retail trade at the moment is still for the greatest part in
the hands of the Chinese, the reality is that this monopoly, which used
to be so strong, is now starting to waver. Today, the Indonesians, the
Dutch, and above all the Japanese are eager to take over the position
lost by the Chinese.
To prevent this, a change of course was urgently needed and Geo.
Wehry & Co. Tsa Chih provided some of the tools required. In the
magazine series of articles were published dealing with law (Kehaki-
man oentoek Soedagar), window dressing (Kita poenja Etalage), or marketing
in general (Toean Toko . . . Awas! ) which discussed such aspects as the
proper use of display cases, good lighting, and advertising.23
Geo. Wehry & Co. also paid specific attention to its Langganan-lang-
ganan, or long-standing clients, whose custom was considered of vital
importance to maintaining current turnover levels.24 Although their
loyalty had been appreciated before, it was at the time valued even
more because of the bad economic situation. To celebrate the loyalty
22
Geo. Wehry & Co. Tsa Chih, I 1 ( January 1933).
23
Geo. Wehry & Co. Tsa Chih, I 1 and 2 ( January 1933); Geo. Wehry & Co. Tsa
Chih, I 12 ( June 1933).
24
See Willmott (1960) for the importance of the langganan system in establishing
trust relations. Willmott defines a langganan as a regular client/customer or his oppo-
site, the regular dealer/supplier. According to him the langganan businessman and his
client enter into an explicit or implicit agreement to trade exclusively with each other
in a certain field, as a result of which they develop a prolonged acquaintance, mutual
obligations, considerable trust and even friendship (Willmott 1960, 701). Confirma-
tion of the above can be found in Leiden at the oral history project of the Koninklijk
Instituut voor Taal-, Land- en Volkenkunde (KITLV) entitled Stichting Mondelinge
Geschiedenis Indonesi (SMGI). See for instance SMGI, Boer 1170.13.
of these men and women, each issue of Geo. Wehry & Co. Tsa Chih
printed a photograph of a client with whom the company had traded
for more than twenty years (See Box 4).
These wonderful portraits showed the proud owner of a shop with
the following text in Malay: Sobat2 dengen siapa kita soeda berdagang lebih
dari 20 taon (Friends with whom we have traded for more than 20
years). With some, Geo. Wehry & Co. had maintained business
Box 4. Langganan-langganan Geo. Wehry.

Source: Geo. Wehry & Co. Tsa Chih, I 12 ( June 1933).
relationships for over forty years. Djie Hong Swie, a trader in textiles
from Surabaya, held the record, having traded with Geo. Wehry &
Co. for forty-five years. According to the text under his picture, he was
a personal friend of the partners and highly respected by all.25
To what extent these and other endeavors mentioned above man-
aged to turn the tide remains unknown, but their contribution, how-
ever small, to the survival of trading business in general cannot be
denied. Margo-Redjos success during the height of the crisis testifies
to this. However, there were many other forces at play during the
1930s and some were of greater and more direct consequence. The
competition of Japanese traders, for instance, was successfully curbed
by the introduction of the Crisis Import Ordinance of 1933, which
reduced Japans share of imports from thirty-two percent to fifteen
percent in 1937. It would have been impossible for an invigorated
Chinese business mentality to achieve the same result in such a short
period of time.
Still, the importance of government measures was exceeded by the
worldwide improvement of economic conditions during the second
half of the 1930s. Once price levels started to climb, trading soon
recovered its profitability. This could not have been achieved by good
illumination, nice show cases, or courses on window dressing alone.
However, under the improved economic circumstances it seemed as if
the promise of these new initiatives could finally be fulfilled.
Unfortunately, the occupation of the Netherlands Indies by the Jap-
anese in 1942 prevented this. The relatively short period before the
war failed to see the successful implementation of the many new ideas
within the trading sector at large. More time was needed for people
to change the way they conducted their business. Margo-Redjos lead
over the competition could have served as an example, but with the
arrival of the Japanese any advantage the company had once enjoyed
immediately vanished.26
The disruption of its business was initiated in February 1942 when
the Dutch destroyed most of the firms machinery as part of a planned
scorched earth policy. Following the defeat of the Dutch, all goods in
storage were looted and never returned.27 Outstanding debts could
25
Geo. Wehry & Co. Tsa Chih, I 12 ( June 1933).
26
Private archive Margo-Redjo; Interview B. Dharmowiyono, December 4, 1999.
27
See for a general description of the chaotic events in Java and more specifically
Semarang during the Japanese attack Brugmans et al. (1960, 1023, 11928, 25383),
no longer be collected and were largely written off. Margo-Redjos

business activities thereby came to a halt. When the war ended the
company had to be built again from the ground. Operated by W.B.
Dharmowiyono (Tan Tjoan Pie), a grandson of Tan Tiong Ie, the
company today is still producing coffee under the old brand name
Mirama. (See Box 5) No compensation was ever obtained from the
Dutch government for the loss of its machinery.
Box 5. Margo-Redjos coffee Mirama.

Source: Private archive Margo-Redjo.
De Jong (1984 Vol. 11a, 64950, 97883) and Twang Peck Yang (1998, 704). A
graphic presentation of the Japanese conquest of the Netherlands Indies can be found
in Cribb (2000, 150).
Concluding Remarks
As seen, Margo-Redjo dealt with the economic crisis effectively. The

company managed to survive and grow until, by the mid-1930s, it had
become the largest enterprise in the coffee roasting business in Java. A
remarkable achievement since the economic tide would seem to pro-
vide little incentive for enterprising conduct. But this is only one way
of looking at the difficult economic circumstances of the time. People
respond strongly to strong incentives, especially when their livelihood
is threatened. The economic crisis of the early 1930s constituted such
a threat, as it appeared to be random, all pervasive and out of every-
ones control.
An incentive can be defined as a means of urging people to act. The
possibility of going bankrupt ortaken more positivelythe chance
of surviving the worldwide economic onslaught urged Margo-Redjos
management to reconsider its entrepreneurial conduct by making use
of novel marketing and sales techniques. These new insights did not
necessarily conform to conventional wisdom and required a break
with some well-honored (Chinese) practices of doing business. Though
not necessarily true, conventional wisdomfirst coined by the econ-
omist John Kenneth Galbraithis simple, convenient, comfortable,
and comforting. Given these traits it is difficult to break away from
old beliefs, something Geo. Wehry & Co. realized by attempting to
change the business outlook of its customers and transform conven-
tional wisdom through the publication of its own trade magazine.
In general, the acceptance of the required trade-off depends upon
the degree to which it affects peoples well-being as well as the ease
with which a new idea may be understood. Obviously, Margo-Redjos
management perceived the required trade-off as beneficial and was
therefore willing to change course. The companys main leverage, how-
ever, appears to have been Tan Liang Ho, who had studied at Leiden
University and kept himself informed of the latest developments by
buying specialist magazines and books. Margo-Redjo thereby enjoyed
access to better information at an earlier stage than most other compa-
nies. In the parlance of economists, such a case is known as an infor-
mation asymmetry and it can only be concluded that Margo-Redjo
managed to exploit this situation to its fullest advantage.
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CHAPTER EIGHT
THE OEI TIONG HAM CONCERN AND THE CHANGE OF

REGIMES IN INDONESIA, 19311950
Peter Post
Introduction
The central decades of the twentieth century posed tremendous chal-

lenges for ethnic Chinese family firms in Indonesia. During this period
the late colonial Dutch regime was forcefully replaced by a short-lived
but highly significant Japanese military administration and followed
by the independent Republic of Indonesia. Each of the regime transi-
tions was accompanied by widespread anti-Chinese violence resulting
in many deaths and great material damage to Chinese shops, trading
firms, manufacturing industries, and agricultural enterprises. Since each
of the regimes professed different economic policies and created highly
different sets of economic institutions (partly because of the changes in
the global economic environment, partly because of different ideolo-
gies), ethnic Chinese firms were forced to adapt and adjust themselves
constantly in order to sustain their businesses. Some were successful,
others failed. The mechanisms underlying the various Chinese busi-
ness responses towards the enforced institutional changes during these
crucial decades in Indonesian history have so far hardly been studied,
let alone understood. The major reason seems to be that most writ-
ings on the ethnic Chinese experience during the Japanese military
administration and the Sukarno regime have used political frameworks,
rather than business perspectives. The powerful nation-state paradigm
fitted the indigenous bourgeoisies and U.S. hegemonizing efforts in the
region. In the post-war debates on modernization, development and
nation-state building simplified dichotomic frameworks ruled the dice,
and within these frameworks no need was felt to delve deeper into
the experiences of the ethnic Chinese business elites, since they were
simply seen as collaborators and profiteers of an unjust colonial order
and exploiters of the indigenous populations, actually preventing their
emancipation rather than supporting it. This collaboration-resistance
170 peter post
dichotomy has dominated the post-war research agenda for decades,

although it was termed differently in different regions.
Regarding motivations and business strategies of Chinese capital-
ists in wartime China, North American scholars have recently started
to question the usefulness of the collaboration-resistance framework,
pointing out that matters were far more complex and fluid (Coble
2003; Brook 2004; Cochran 2006). Similarly, in regard to Chinese
business responses in Yogyakarta under the Japanese military regime,
Kwartanada (2002, 257) has argued, that they were confronted with
three major issues: competition against the emerging Indonesian
entrepreneurs and Japanese business expatriates; patriotism towards
their ancestral land China in fighting against Japanese aggression; and
collaboration with the new regime run by their former enemy, the Japa-
nese. Except for Twang (1998) and Kwartanada (2002), little research
has been done into the way Chinese family businesses in the Nether-
lands East Indies coped with the period of intense and often extremely
violent regime changes when Western colonial rule was swept aside by
Japans military power and subsequently by nationalist forces result-
ing in the decolonization of the region. This essay aims to fill this gap
by looking at the fates and fortunes of the Oei Tiong Ham Concern
(OTHC), the largest ethnic Chinese conglomerate in pre-war Asia,
during the reign of Oei Tjong Hauw.1 Unlike many other ethnic Chi-
nese businesses in pre-war Indonesia, OTHC was able to survive the
regime changes fairly well, and by the mid-1950s was once again rated
as the largest ethnic Chinese business conglomerate in Asia. This essay
1
The Kian Gwan trading firm, predecessor of the Oei Tiong Ham concern, was
established in Semarang by Oei Tjie Sien in 1863. Under the directorship of the leg-
endary Oei Tiong Ham (18661924), son of Oei Tjie Sien, the company grew into
a multinational corporation. After Oei Tiong Hams death, the company was first
directed by Oei Tjong Swan (18991944), son of Oei Tiong Hams third wife, from
1925 until 1930, and subsequently by Oei Tjong Hauw (19041950), eldest son of
Oei Tiong Hams fifth wife. The latter steered the corporation through the depression
years and the Japanese period. There are several articles and books on the develop-
ment of the Oei Tiong Ham Concern and more specifically on the achievements and
entrepreneurial cunning of Oei Tiong Ham. See for example, Liem (1979), Koo (1943
and 1975); Tjoa (1963); Panglaykim and Palmer (1970). Yoshihara (1989) brings sec-
tions of these books and articles together. In addition, Yoshihara added contributions
by Onghokham (on Chinese capitalism in Java) and Charles Coppel (on Liem Thian
Joes unpublished History of Kian Gwan) and included two extensive interviews with
Oei Tjong Tjay and Oei Tjong Ie. But as Coppel noticed in his contribution to the
Yoshihara volume, little is known about the Oei Tiong Ham Concern during the
central decades of the twentieth century.
the oei tiong ham concern 171
studies these business responses of OTHC during the 1930s1950s

from the perspective of its main protagonists and will argue that the
strategies employed during the Japanese period were part and parcel
of a long-term strategy that was aimed to keep family control intact,
spread business risks, and lessen the dependence on Indonesia for the
survival of the conglomerate. The essay is arranged chronologically,
focusing respectively on the late Dutch colonial period, the Japanese
interregnum, and the Sukarno period.
The First Decade of Oei Tjong Hauws Rule, 193119422
When Oei Tjong Hauw (190450) took full control of OTHC he was
only twenty-six years old. It is difficult to imagine what he must have
felt like taking over a multinational conglomerate with some 25,000
people in the Netherlands East Indies on its payroll, a bank, a steam-
ship company, sugar factories, an enormous wholesale business, and
a well-known international trading firm, as well as branch-offices in
Singapore and London, and over ten branches in the Indies. There
is little information about his early life, and although he entered the
HBS there is no evidence that he completed this higher education.
According to most written and oral sources, he received only little
training from his father. Until the age of seventeen he most probably
2
In writing this essay I greatly benefited from a large number of interviews con-
ducted with members and close associates of the extensive Oei Family. Unfortunately,
some of them have recently passed away. I am most grateful to Oei Tjong Ie ( Jack,
19182007), Oei Tjong Tjay (Benny, 1924), both sons of Oei Tiong Ham, and to Tan
Swan Bing (19082004) for sharing their thoughts and detailing their life-histories with
me. Also to Oei Ing Swie (Billy, 19242005), eldest son of Oei Tjong Hauw, who in
his e-mails was kind enough to share his views. Moreover, I would like to thank Ms Dr
Yve Boen San Tjiang and Ms Lieke Oei Tiang Han (daughters of Tan Tek Peng),
Oei Hwaij Liem and Oei Tiang Han, for kindly providing me with a rare 1959
manuscript on the History of Kian Gwan written by Tan Tek Peng, and for detailing
their personal experiences during the Japanese occupation and the Sukarno period.
In addition I have talked to many peranakan Chinese living in The Netherlands and
Singapore, who had married into the Oei family or who were otherwise connected to
them. I gained much insight into the complicated Oei family structure through a close
analysis of a number of private photo albums. I would like to thank Kwee Kiem Han,
Oei Tiang Han, and Khoe Liong Hoey for allowing me to use their family photo-
albums. I am moreover grateful to Ms Twie Marinkelle-Tan for introducing me to
the Oei Family and the late Mr Tan Swan Bing. I would like to emphasize that the
ideas expressed in this essay are mine only and do not necessarily reflect the thoughts
of the people interviewed.
172 peter post
led a life of leisure and pleasure befitting his status as one of the heirs
of OTHC. Most of his early education he apparently received from
his mother Ong Mie Hoa Nio. In 1921 his father took him into the
business and made him chief of the loan and mortgage department,
mockingly called the Bank Oei Tiong Ham (Tan 1959). At the age
of twenty he married Be Hien Nio, youngest daughter of the famous
major-titular of Solo, Be Kwat Koen.
Through this marriage Oei Tjong Hauw became member of a
highly influential and respectable peranakan family that had close ties
and intimate relations with the Central Javanese royalties and the
Thai royal family.3 Being at the helmet of OTHC at this young age,
he relied most heavily on the knowledge and business experience of
some of the concerns most talented professional managers.
First among these was Tan Tek Peng (18961969), who had joined
Kian Gwan in 1917 and served as its executive director from 1924 to
1952. Tan was born in Bandung and was a brilliant student in book-
keeping. He finished the Dutch high school (HBS-B, which until the
early 1970s was the major higher education for a business career in
The Netherlands) and became chief bookkeeper in 1920. After Oei
Tiong Ham moved to Singapore in 1924 he promoted Tan to execu-
tive director of the trading department of the conglomerate. Although
he himself was not directly related to the Oei family, a niece of Tan
Tek Peng was married to Oei Tjong Liam, half-brother of Tjong
Hauw.4 Under Tans leadership the trading interests of the company
greatly expanded. During the 1920s, when Oei Tjong Swans directed
the conglomerate, Tan opened branches in Calcutta (1925), Bombay
(1926), and Karachi (1928) to buy jute sacks for the packing of sugar,
and in the early thirties set up offices in Bangkok, Canton, Tsien-
tsin, and Amsterdam. The Bangkok office was mainly engaged in the
export of rice to Java, whereas the China branches dealt in a wide
range of goods. Tan Tek Peng became a well-known figure in Java-
nese business circles. He was small (1.60m.), good humored, and was
known as the Little Napoleon of OTHC. In the mid-thirties he was
3
Be Kwat Koen was a nephew of Be Biauw Tjoan and heir to the Be fortunes.
4
Interview Yve Boen, November 2004. Dutch archive sources mention that Tan
Tek Peng was an illegitimate son of Oei Tiong Ham, which according to these sources
was one of the reasons that Oei Tiong Ham favored the young boy so much. A close
associate of Tan Tek Peng, Mr Tan Swan Bing (19052004) saw no reason to deny
this rumor.
vice-chairman of the Semarang Chamber of Commerce as well as the

head of Chinese Chamber of Commerce. He was active in the Chung
Hwa Hui (CHH), the peranakan political party that favored a closer
integration of the Indies with The Netherlands; he wrote extensively
in the Semarang newspaper De Locomotief regarding matters pertaining
to the Indies economy in general and Chinese business in particular.
At the eve of the Japanese occupation he, together with Oei Tjong
Hauw, was the undisputed leader of Kian Gwan. Although his com-
mand of the Chinese language was good, he was mainly responsible
for communication with the Dutch and other Western business rela-
tions of OTHC and as such was indispensable for Oei Tjong Hauw.
Relations and communications with the Chinese business commu-
nity, the native labor force, and the native ruling elites were generally
in the hands of two other confidants of Tjong Hauw, e.g. Tjoa Soe
Tjong and Lie Hoo Soen.
Tjoa Soe Tjong was formally director of the N.V. Bankvereeniging
Oei Tiong Ham and he had good relations within East Asia and the
singkeh Chinese business circles in Java and Sumatra. Between 1932
and 1937 he traveled with Oei Tiong Hauw to Hong Kong, Shanghai,
Kobe and Tokyo looking for investment and trading opportunities.
When in 1934 OTHC opened an alcohol factory in Shanghai, in col-
laboration with the Chinese government, Tjoa became its sales man-
ager. Later he became the manager of Kian Gwans Shanghai branch
and during the Japanese occupation he would head the main office
in Semarang. In 1952, after Tan Tek Pengs retirement, he became
executive director of Kian Gwan.
Lie Hoo Soen was in charge of what might be called the native
department of the conglomerate. Oei Tjong Hauw and Lie Hoo
Soen probably knew each other from a very young age, asaccording
to all informantsthroughout his life Tjong Hauws closest and most
trustworthy friend was Lie Hoo Soen. He entered the concern in 1925
and stayed until 1961. First he started in the agricultural department
and later was appointed as manager of the real estate division. Lie was
the mata-mata (spy) of OTHC and he was the only one that could
enter Tjong Hauws office without making an appointment. Although
he held an official position as manager, his main task was to infiltrate
in labor unions, bribe nativeand later Indonesianofficials, put the
screws on bad debtors, and deal with labor union leaders. People in
and outside OTHC were afraid of him, since nobody knew exactly
what his position was, whether he could be trusted or not, and how
174 peter post
close he was with the son of Raja Gula (Sugar King) Oei Tiong Ham.
Managing-directors like Tjoa and Tan Tek Peng hardly had any idea
what kind of deals Lie Hoo Soen actually made for the company. And
in a way they didnt care. When there was labor unrest or a large
debtor needed to come forward, they knew that Lie Hoo Soen would
successfully take care of it, but how he handled these cases, nobody
except for Oei Tjong Hauwknew.5
When in the 1930s the Depression hit the Indies hard and the
sugar industry in particular was affected, Tjong Hauw and his execu-
tive directors started to look for new investment possibilities and new
markets for Indies produce. In this they showed great creativity and
innovativeness.
In 1933 they moved into the rubber remilling industry in South
Sumatra by renting a rubber mill in Palembang owned by the Dutch
Rubber Union. Together with the Singapore based, Lee Rubber Com-
pany, which rented the rubber mill of Internatio, Kian Gwan came to
play a pioneering role in transforming South Sumatran rubber exports
from slabs to blankets, and by 1936 half of Palembangs rubber exports
were blankets. At this stage Kian Gwan decided to rubber sheet pro-
duction and set up collecting agencies in the interior. Since hand man-
gles were essential to the production of small holder sheet rubber, the
company also encouraged their import and distribution selling them
mainly to warung holders. Lee Rubber and also Nomura East Indies
(the largest pre-war Japanese investor in the Indies) did the same, and
in 1941 a total of 31,000 tons of sheet rubber (thirty-six percent of
exports) went out from Palembang. To create new markets for its rub-
ber Tan Tek Peng traveled to New York and would soon find important
clients. He negotiated a special arrangement with the Dutch shipping
line KPM whereupon Kian Gwan started to export blankets (and later
sheets) directly to the United States, thereby breaking the monopoly of
5
Benny Oei Tjong Tjay, who took over OTHC Indonesia in 1950, confided to
the author that Lie generally scared him and that he did not know how to deal with
him. He too avoided Lie as much as possible and just handed money whenever Lie
requested it; knowing too, that whatever Lie did, it was always in the interest of the
firm. Authors interview Benny Oei Tjong Tjay, November 4, 2004. Little is known
about Lie Hoo Soen. But he is most probably related to Lie Siong Hwie who headed
the Kian Gwan Surabaya branch after 1907 and had been involved in the company
for more than twenty years. Lie Siong Hwie was president of the Surabaya Chinese
Chamber of Commerce at the time. Wright (1909, 5478).
Singapore as the entrepot center for South Sumatran rubber. Kian

Gwans remilling factory sold 2,000 to 3,000 blankets per month, mak-
ing this venture a big success. In the next decades rubber, rather than
sugar, would be the mainstay of Kian Gwans business.
Tan Tek Pengs trip to New York had another effect on the com-
panys business diversification. Noticing that the tapioca market in the
U.S. offered good possibilities for expansion, the company founded
its own tapioca factory in Krebet and started shipping tapioca flour
directly to that country. In doing so, it became a fierce competitor
of the Dutch-owned Handelsvereeniging Amsterdam (HVA), which
until that time had monopolized this trade. The U.S. became also an
important market for other products Kian Gwan handled.
Figure 1. Tan Tek Peng.

Courtesy: Mrs Lieke Oei Tiang Han.
176 peter post
Opening Up China and Japan
Whereas Tan Tek Peng took the responsibility to open up markets

in the Western hemisphere (Europe and the United States), Tjong
Hauw and Tjoa Soe Tjong looked for new opportunities in East Asia,
especially China and Japan. As has been said above, between 1932
and 1937, Oei Tjong Hauwtogether with Tjoa Soe Tjongtraveled
extensively to Hong Kong, Shanghai, Kobe, and Tokyo looking for
investment possibilities and new trading opportunities. China and in
particular Shanghai had Tjong Hauws great attention. This roaring
city had a big appeal to young, handsome, and powerful ethnic Chi-
nese tycoons from Southeast Asia like Tjong Hauw. Its cosmopolitism
was highly attractive when one wanted to escape the rumor and gos-
sip and the strict social norms of peranakan Chinese society in Java.
And Oei Tjong Hauw had every reason to escape gossip-rich Java. He
was still married to Be Hien Nio, who had given him three children,
and the couple lived together. But he had fallen in love with a beauti-
ful young Eurasian woman, who had become his mistress, and both
of them wanted to spend time together. She was getting bored and
increasingly frustrated with their life in Java, especially since she felt
that the two of them were always being watched, gossiped about, and
could hardly spend time together. She therefore urged Tjong Hauw to
buy an apartment in Shanghai so that the two of them could go out
unhindered and dance the night away without being watched and
criticized by the colonial elite. So when in Shanghai Tjong Hauw was
invited by Chen Kung Po, mayor of Shanghai and later to become
minister in the Japanese puppet regime of Wang Ching Wei, to jointly
set up an alcohol factory near Shanghai in 1934, he was eager to
respond positively to this request. The company took care of the
management of the factory and the sale of alcohol. In due course the
alcohol factory became the largest of its kind in Southeast Asia with
a production capacity of 4,000 gallons of industrial alcohol per day.
Tjoa became the factorys first sales manager. Oei Tjong Hauw had
managed to combine successfully private and business motives, and
was able to offer his mistress the kind of life she was looking for.6
6
In a personal interview Tjong Hauws half-brother, Oei Tjong Ie, insisted that
Tjong Hauws main motivation, however, was to bring his mistress to Shanghai and
that business motivations were only secondary. Post (2004, 14).
Tjong Hauws association with Chen Kung Po coincided with a

general shift in peranakan Chinese attitudes towards Dutch colonial
(economic) policies of the time and Republican China. In September
1933 the Dutch colonial office had instituted the Crisis Import Ordi-
nance to ward off the Japanese penetration of the Indies economy and
to protect the Dutch textile industry from severe Japanese competition
in the Indies market.7 The regulations implemented were designed to
protect the interests of not only Dutch textile industry but also the
large Dutch trading companies and Dutch shipping in the foreign
trade of the Indies. Since the colonial export economy was in a ter-
rible state, getting actively involved in the Japan-Java trade was about
the only way for large trading firms like Kian Gwan to make profits.
However, the Crisis Import Ordinance was designed in such a way
that major ethnic Chinese trading firms like Kian Gwan, Kwik Hoo
Tong Trading Co., and Liem Bwan Seng Co. were unable to reap the
benefits of the increasing demand for Japanese textiles in the Indies
markets. The Dutch banks in the Indies, and especially the Java Bank
which financed much of Kian Gwans and also Kwik Hoo Tongs
trade, working in tandem with the colonial government, forced the
major ethnic Chinese trading firms not to step into the lucrative Japan
trade, but rather to stick to their traditional export trade of Indies
produce.8 This type of Dutch-first economic policies caused much
resentment on the part of Oei Tjong Hauw, his managing-directors,
and the Semarang Chinese business community at large. There was
a general feeling that if they were not allowed to engage actively in
Japans export trade towards the Indies, they would look to Republi-
can China and to develop the Indies market for Chinese products.
To achieve this, a closer cooperation between the singkeh economic
elite and the Chung Hwa Hui (CHH), the major peranakan political party
in Central Java, was sought for. The CHH was mainly financed by the
7
See Alex Clavers contribution to this volume.
8
Since increasing sugar exports to Japan were part of the bilateral deal made
between the Japanese government and the Dutch colonial office in 193334 and
Dutch trading firms were not particularly equipped to handle huge amounts of sugar,
the pressure on the large Chinese trading firms to focus only on their traditional
export trade, rather than to step into the import trade from Japan, might have been
good policy from the Dutch colonial authorities point of view. But the powerful ethnic
Chinese business class thought otherwise. According to them they could have easily
developed both trades successfully. This, however, would have had an even more
negative impact on the role of Dutch trading firms and hence on the carefully struc-
tured social economy the Dutch colonial government wanted to protect.
178 peter post
OTHC and membership of the CCH mostly consisted of employees

and agencies of the concern. It was said that of one hundred CHH
members in Semarang, ninety were related to the vast business empire
of the Oei Family (Lohanda 2002, 155). Following Oei Tjong Hauws
travels to Shanghai, in 1933 Kan Hok Hoei (HH Kan), chairman of
the CHH and member of the Peoples Council (Volksraad ), went to
China to negotiate closer cooperation with the Republican govern-
ment. Subsequently, in 1934 Oei Tjong Hauw invited Chen Kung Po
to visit the Netherlands East Indies and to initiate, together with the
Chinese Consul General in Batavia, the establishment of a Federa-
tion of Chinese Chambers of Commerce in Batavia. The office of this
federation was in the same building as the CHH office and the office
of the main division of the KMT. HH Kan became the first president
of this Federation (Lohanda 2002, 115). In the meantime, Tjoa Soe
Tjong organized a large China Fair in Semarang, which drew much
attention and attracted large crowds.
Although the Dutch colonial office was wary of the increasing col-
laboration between the Semarang Chinese business community (CHH
and OTHC) with Republican China, Oei Tjong Hauw received much
support from Mangkunegoro VII, one of the four rulers of the Native
Principalities in Central Java.9
Mangkunegoro VII, who was very close with Be Kwat Koen (major-
titular of Solo), the father-in-law of Oei Tjong Hauw, had a great
interest in Tjong Hauws China ventures.10 As ruler of the Mangkune-
gara he was particularly keen in developing native agriculture and
modernizing the local economy and traditional Javanese society. In
introducing modern technologies and new agricultural techniques he
looked to both the West (The Netherlands) and the East.11 During his
years in Shanghai Tjong Hauw regularly wrote letters to Mangkune-
goro VII informing him about the political and economic situation in
9
The following is drawn from the private correspondence of Mangkunegoro VII
with Chinese from Central Java covering the period 191644. I am grateful to Madelon
Djajadiningrat-Nieuwenhuis for making these sources available for the project.
10
The special relation between the Be Kwat Koen and Mangkunegoro VII is dealt
with in Post (2009).
11
In her recently published Vorst tussen twee werelden [Monarch between two worlds]
(Schoorl: Uitgeverij Conserve, 2006) Madelon Djajadiningrat-Nieuwenhuis looks spe-
cifically at the relations between Mangkunegoro VII and Dutch intellectuals. In this
illuminating study, which has been written in the form of a novel, Ms Djajadiningrat
makes extensive use of private letters and memoirs of MN VII and his intimate Dutch
intellectual friends.
China and sending him Chinese goods to be introduced in his domain.

With the support of Mangkunegoro VII, Oei Tjong Hauw was able to
create new markets in Central Java for Chinese manufacturers, which
at the same time benefited Kian Gwan Trading Co.
By calling on a variety of different ethnic networks, Tjong Hauw and
his senior-directors skillfully managed to expand into different global
regions, the U.S. and China. Their motives to do so were purely com-
mercial and in the interest of the family business. These motivations
also lay at the background of their expansion towards Japan.
OTHC and Japans Pre-War Expansion into East and Southeast Asia
In the pre-war period Japans rise as an industrial and military power

in Asia greatly affected the regions economic and political balance
of power. After the First World War the country extended its ship-
ping, trading, and financial networks towards colonial Southeast Asia
and its export industries began to conquer colonial markets. Japa-
nese zaibatsu and large trading firms invested heavily in the regions
resources, especially rubber, sugar, and in the late 1930s bauxite, tin,
forestry, and fisheries. In this economic expansion Japanese shipping,
trading firms and banks cooperated closely with Chinese business net-
works in Makasar, Semarang, Singapore, Hong Kong, Shanghai, and
Taiwan.
Oei Tiong Ham was one of the most powerful ethnic Chinese entre-
preneurs in Southeast Asia who worked intensively with Japanese busi-
nesses. He assisted Japanese merchants with capital and connections in
the pre-World War One period and during that War provided secret
funds to set up the Japanese-controlled China & Southern Bank in
Taiwan together with another famous pre-war Chinese capitalist,
Kwik Djoeng Eng (Post 2002). Whereas many Southeast Asian Chi-
nese firms resorted to occasional anti-Japanese boycotts due to Japans
acts of aggression in China, Oei Tiong Ham never took part in this.
And due to his power and influence in Semarang and Central Java,
the Semarang Chinese community almost never joined such a boy-
cott movement. Oei Tjong Hauw shared this attitude of his father.
Although the company did not engage in direct imports from Japan, it
did, however, distribute Japanese goods in the Indies and had a large
export trade with the country, mainly rubber and sugar.
Kian Gwan was a major exporter of sugar (since 1926) and rubber
to the Land of the Rising Sun, but in the 1930swhen other ethnic
180 peter post
Chinese firms in Southeast Asia became increasingly involved in anti-

Japanese boycottsthe company saw new possibilities. From the early
thirties onward it started to export maize from East Java to Japan and
in due time it would almost monopolize this trade.
In 1939, after Germanys invasion of Poland, Kian Gwan opened
a branch office in Tokyo. This office was headed by a certain Hayashi
who was the manager of Senda & Co. Ltd., a large Japanese trading
firm in Surabaya.12 Hayashis main task was to find clients for the
export products Kian Gwan handled at the time and he did so quite
successfully. In Surabaya he also came to head the maize department
of Kian Gwan.
That the conglomerate was not willing to support the anti-Japanese
boycott movements and only meagerly financed the National Salva-
tion Movement after the outbreak of the Sino-Japanese War in 1937
aroused bitter feelings among Singaporean and Malaysian Chinese as
well as among pro-China groups in the Indies. Given the fact that
under Japans military rule the OTHC apparently cooperated heartily
with the new masters, this Japan issue continues to be hotly debated.
But to Oei Tiong Ham, Oei Tjong Hauw, and the companys man-
aging directors, it has always been a policy that business rationality
should not be hindered by politics and or emotions. That they, how-
ever, were anxious about Japans expansionist policies is clear from
the following.
In the early 1930s OTHC started its own and successful newspaper,
Matahari, in Semarang.13 To keep track of political and economic devel-
opments and expansionist ideas in Japan it send out its correspondent,
Ahmad Subarjo, to Tokyo. Subarjo, who later became Indonesias first
foreign minister, stayed in Japan for about two years and afterwards
regularly went there in the same capacity. His main task was to inform
the board of OTHC about Japans southward intentions and military
build-up. Subarjo had no connections in Japanese business circles and
did not become involved in OTHC business activities in the country.14
After 1933 OTHC was quite anxious about Japans political course
and possible military advance and to what extent this could affect its
business interest in Japan and China.
12
Interview Tan Swan Bing, January 2003.
13
The Matahari was to become the most profitable newspaper in the Netherlands
East Indies.
14
Authors interview with Tan Swan Bing, December 2004.
This anxiety and cautiousness became also apparent in their nego-

tiations with the large Japanese banks. The companys main bank
was the Nederlandsch-Indische Handelsbank (NIHB). The people
here were considered knowledgeable and businesslike, unlike the NI
Escomptobank, which was considered highly incapable with incompe-
tent staff. OTHC had for many decades build up a trustworthy and
profitable relation with the NIHB. But in the 1930s other banks, par-
ticularly American and Japanese, started to offer services that were
more lucrative and seemingly more profitable. In the case of the Japa-
nese Yokohama Speciebank (YSB), OTHC generally declined their
offers, since it was afraid that it might end up in YSBs financial web,
which when war broke out would be quite difficult (and maybe impos-
sible) to untangle.15
Also in the private sphere, the members of the Oei family and its
management expressed their anxiety and antipathy for Japans fascism
and military aggression. There was a general feeling that Japanese
militarism and expansionist ambitions were bad news and this message
was also brought to their children, especially after the Nanking atroci-
ties became known.16 In general, the OTHC management made a
clear distinction between business interests, private feelings, and politi-
cal viewpoints with regard to Japan. It was felt that economic decisions
should not be based on political ideas or emotions, but should be
calculated and rational in the interest of the firm and family. To the
group as a whole it was clear that an anti-Japanese boycott would have
no effect whatsoever on Japans industrial development and economic
(and possible military) expansion, and to try so would be pure non-
sense and a waste of money.17
15
Interview Tan Swan Bing and Benny Oei Tjong Tjay. December 2004. How-
ever, recently Ms. Yuko Kudo, a PhD graduate of Tokyo University, discovered that
at least in the second half of the 1920s, OTHC did make use of the financial services
of the YSB. To what extent this relation continued in the 1930s needs to be scruti-
nized further.
16
Tan Tek Peng, for example, forbade his daughters to go to school and learn
Japanese culture and language during the Japanese period in Indonesia. They were
forced to stay inside and keep out of sight. Interview Yve Boen and Lieke Oei, daugh-
ters of Tan Tek Peng, May 2007.
17
Interview Tan Swan Bing. The late Mr. Tan, voicing the opinions of others
in the company, was very clear and outspoken about this. He considered the anti-
Japanese actions by Tan Kah Keh and other prominent leaders of the wide-spread
National Salvation Movement as highly irrational and ineffective.
182 peter post
Corporate Structure
The expansion since the late 1920s demanded an adaptation of the

companys structure and a modernization of its administrative appa-
ratus. To that effect Tan Tek Peng in 1933 brought in a young and
talented assistant-accountant, Tan Swan Bing (19062004). He gradu-
ally transformed the administrative department into a sound, mecha-
nized, and modern accounting section, which also became an advisory
department in matters of finance, economy, and taxes. Tan Swan
Bing, among other innovations, introduced the modern punch-card
system into the company, the first of its kind to be used in the Indies.18
The extension of the trading business also led to the formation of dif-
ferent departments and divisions within Kian Gwan Trading Co.19 In
1930 a new department was established, the Primex (Product Import
and Export), which concentrated on the import of rice from Thai-
land, cloves from Zanzibar, and tea from Formosa,20 while it exported
sugar, rubber, coffee, kapok, and maize. The Primex department gave
special attention to sugar sales for local consumption and succeeded in
obtaining more than sixty percent of these sales which for the whole
archipelago meant a yearly turnover of more than 200,000 tons. In
addition, Primex came to supervise two important branches, e.g.
Palembang (rubber) and Makasar (maize and copra).
In 1931 Kian Gwan started a separate import business for con-
sumer and luxury goods, the Kian Gwan Import Department, and in
193235 two other departments were created, e.g. the Hide & Skin
Department and the Insurance Department. This last department was
strictly speaking an insurance pool where the Kian Gwans interests
were insured with a fixed share of participation by large British, Aus-
tralian, and American insurance companies. In establishing these dif-
ferent departments within Kian Gwan Trading Co., Oei Tjong Hauw
and Tan Tek Peng wanted to spread their risks, and especially the
risks involved in the speculative sugar trade. The establishment of a
separate Import Department turned out to be a blessing in the 1930s
when the export trade collapsed and in the 1950s when the Indies
market needed huge amounts of foreign articles.
18
Interview Tan Swan Bing, December 2003.
19
Details in these sections come from Tan (1958).
20
As might be recalled this was the tea business Oei Tiong Ham Concern had
taken over in 1926 from the Kwik Hoo Tong Trading Society.
The wide-spread interests and the vast staff and diverse labor force
demanded further attention to the personnel front to ensure commit-
ment, loyalty, and harmonious working relations throughout the con-
glomerate. To achieve this, the staff members, in consultation with the
directors, formed in 1939 the Sarpoci (Sarikat Pegawai Oei Tiong Ham
Concern Indonesia). The head-committee of the Sarpoci was located in
Semarang, whereas in the main branch-offices side-committees were
formed. In these committees directors and staff members regularly
got together to explain business decisions, to discuss salary scales and
old-age provisions, leave regulations, and staff housing problems.
The creation of Sarpoci contributed to feelings of belonging to
the concern, and it tended to alleviate feelings of competition and
antagonism between staff members of the industrial and commercial
departments.
Table 1. Corporate Diagram
In 1932 the Oei Tiong Ham Concern consisted of the following legal entities:21
1. Kian Gwan Trading Company (capital 3 million guilders)

Directors: Oei Tjong Hauw and Tan Tek Peng
Main Indies offices: Semarang (manager Oei Tjoen Hui)
Surabaya (manager Li Siong Hui)
Batavia (manager Tan Kim Say)
Foreign offices: Kian Gwan Western Agency Ltd. (London, est. 1910)
Kian Gwan Malaya Ltd. (Singapore, est. 1914)
Kian Gwan India Ltd. (Calcutta, est. 1925)
Kian Gwan Bombay Office (est. 1926)
Kian Gwan Karachi Office (est. 1928)
Kian Gwan Shanghai Branch (1929)
2. Algemene Maatschappij tot de Exploitatie der Oei Tiong Ham Suiker-
fabrieken (capital 40 million guilders)
Director: Oei Tjong Hauw; Vice-director: Dr Djie Ting Ham
Overseas office: Oei Tiong Ham Concern Bangkok Office (est. 1932)
3. Sugar factory Redjo Agoeng (capital 600 thousand guilders)
Director: Oei Tjong Hauw
4. Sugar factory Tanggoel Angin (capital 600 thousand guilders)
Director: Holding Company OTHC Sugar Factories
21
The details in this section come mainly from the Handboek voor Cultuur- en Handel-
sondernemingen (Batavia: De Busy, 1930 and 1933). I would like to thank Drs. Herman
Kwak for thoroughly scrutinizing these materials.
184 peter post
5. Sugar factory Pakkies (capital 600 thousand guilders)

Director: Holding Company OTHC Sugar Factories, Oei Tjong
Hauw
6. Sugar factory Ponen (capital 600 thousand guilders)
7. Sugar factory Krebet (capital 1 million guilders)
Directors: Oei Tjong Hauw and Dr Djie Ting Ham
8. Tapioca factory Krebet (capital 600 thousand guilders)
9. Bank Association Oei Tiong Ham (capital 15 million guilders)
Directors: Oei Tjong Hauw and Dr Djie Ting Ham
10. Heap Eng Moh Steamship Company (registered in Singapore)
General manager: Lee Hoon Keong (grandfather of Lee Kuan Yew)
11. NV Midden Java Veem (wharehousing)
12. NV Bouwmaatschappij Randoesari (real estate)
Director: Bank Association Oei Tiong Ham
13. Grond & Huizenbedrijf Oei Tiong Ham (family real estate)
14. Matahari (newspaper)
On the organizational level we see that by the end of the 1930s the
OTHC operated a highly modern and well-structured multinational
business enterprise with tasks and responsibilities of the different depart-
ments and divisions clearly defined. Mainly due to this rationalization
the conglomerate had been able to overcome the pitfalls of the world
depression and successfully entered new lines of business in the Neth-
erlands East Indies and other parts of the world. Overall control in
the company rested firmly with Oei Tjong Hauw, who was respected
by everyone and had shown himself to be a capable successor to his
father. Since the OTHC was the only ethnic Chinese conglomerate
in pre-war Indonesia that operated on such a grand scale and was so
influential worldwide, the company was envied by many in the Chi-
nese business circles in Southeast Asia and in Java specifically.
The Japanese Occupation
The 3.5 years of Japanese military rule had a large impact on the Chi-
nese business communities in Indonesia. Many well-established large
peranakan firms that were closely integrated in the Dutch colonial
economy found themselves in disarray, and not being able to cope
with the changing business environment, lost much ground to singkeh
Chinese firms.22 Soon after the Japanese troops landed popular unrest
loomed quickly and Chinese firms and shops were its main targets.
Within a couple of days many firms, shops, and factories all over Java
were plundered, its owners and personnel beaten and sometimes mur-
dered, leading to sizable damage to Chinese assets in the Indies. Once
the Japanese forces had established their military administration, it
took a firm stand towards plunderers and offered protection and shel-
ter for the Chinese population groups.
Damage to Chinese property was also caused by Dutch demolition
troops. As part of the scorched earth policies, Dutch military forces
destroyed strategic harbor facilities and the big oil refineries, along
with many Chinese-owned factories (Touwen-Bouwsma 2002, 57;
Twang 1998, 70). One of the sugar factories destroyed was the Ponen
factory in Semarang of the OTHC. In a similar way the Oei family
lost the Palembang rubber remilling factory. The Chinese losses in
Indonesia during the first weeks of the occupation, by both popular
violence and Dutch demolition forces, have been estimated at 100
million guilders (Twang 1998, 71).
Despite the fact that the premises of the Oei family and managing
personnel of the company were also attacked and its buildings, lands,
and factories partly plundered, the Oei Tiong Ham Concern and its
senior staff unlike most other large peranakan firms fared relatively
well under Japans military administration and did comparatively bet-
ter than many other ethnic Chinese firms during the period.
Prior to the arrival of Japanese troops on the north-coast of Central
Java, Oei Tjong Hauw and Tan Tek Peng had been instructed by
Dutch authorities to leave Semarang and to move inland in order not
to fall into Japanese hands. Together with three of his brothers, Tjong
Hauw, Tan Tek Peng, and Tan Swan Bing (including their families)
took refuge in Tawang Mangu (a mountain resort near Solo owned
by Mangkunegoro VII where the Oei family had a villa). Before leav-
ing Semarang it was decided that Tjoa Soe Tong would stay behind
to defend the fortress and that Tan Swan Bing would go on to the
Yogya branch and from there keep an eye on the still active sugar
factories in Madiun and Malang. Jack Oei Tjong Ie, who together
22
This transformation has convincingly been described by Twang (1998).
186 peter post
with his mother Lucy Ho had lived in The Netherlands to study law
and had returned to Java in April 1940 ( just prior to Germanys occu-
pation of The Netherlands), was working at Kian Gwans Surabaya
branch at the time of the Japanese invasion.
In April 1942 Oei Tjong Hauw and Tan Tek Peng were summoned
by Yamamoto Moichiro, Head of the General Affairs Department, to
come to Batavia and were fetched for that purpose by two Japanese
officers to undergo the cumbersome journey from Tawang Manggu
to the capital. When after many difficulties they arrived in Batavia,
the Japanese authorities questioned them and called them all sorts of
names. They were primarily interested in Tjong Hauws ideas about
Japans mission in Asia. Tjong Hauw pointed out that in his house
he had two photographs hanging on the wall, one of Wang Ching
Wei (president of the Japanese puppet regime in Nanking), the other
of Sun Yat Sen, father of the Republic.23 This apparently convinced
the Japanese officers that he was not collaborating with the Chunking
regime of Chiang Kai-shek and subsequently Tjong Hauw and Tek
Peng were sent home without any directives.
In the meantime, all the warehouses of the company had been put
under seal and nothing could be done until, in June 1942, they got a
new summon and again proceeded to Batavia, now by their own means,
which meant the slow train that had started running again between
the most important cities of Java. In this meeting with Yamamoto an
ultimatum was submitted to Oei Tjong Hauw; either agree with the
conditions stipulated or the Kian Gwan concern would be closed and
all the assistant-managers, managers, and higher ranking officials in
the concern would be put into custody. The condition included the
acceptance of Japanese trusteeship and the voluntary offering of their
stocks of sugar and tapioca flour in the factories (more than 20,000
tons with a nominal value of about two million guilders). Having little
choice and being convinced that it was in the interest of the company
and its personnel, Oei Tjong Hauw accepted the terms and signed the
document. They were allowed to go home and the seals could be lifted
from the warehouses.
It took, however, some time before Kian Gwan could start work
again. Staff members were strayed in all directions and had to be
recalled and reorganized; the Netherlands East Indies banknotes had
23
Interview with Benny Oei Tjong Tjay, Amstelveen, December 2003.
to be exchanged into the new Indonesian notes issued by the Japanese

at the rate of 1:1, and the Japanese trustees had to be appointed.
Until this trusteeship formally became effective, Kian Gwan trading
company was allowed to continue its business, the major difference
being that it had to concentrate on retail trade, rather than import
and export trade, which was reserved for Japanese zaibatsu like Mit-
sui Bussan and Mitsubishi Shoji. In the first 1.5 years of the Japanese
occupation the branch in Surabaya, for example, had sufficient stocks
of goods and was still able to make good profits.24 Also, the sugar
factories during this period were still producing. In 1942, eighty-nine
sugar factories produced a total of 1,311,235 tons of sugar. Among
these were the Krebet and Redjo Agoeng factories of OTHC that pro-
duced 21.110 and 24.522 tons respectively, which was almost the same
as production in 1930.25 However, despite their cooperative attitude,
Oei Tjong Hauw c.s. could not prevent the tremendous losses to the
firm during the first year of the occupation. When in November 1942
the Japanese trusteeship formally came into effect, OTHC assets had
fallen to half of their origin level, amounting to thirteen million guil-
ders in Java and 1.7 million in the Outer Islands (Twang 1998, 88).
For most people working in the company it was understandable that
the preconditions of the Japanese war economy were different from
that of the semi-open economy which had prevailed under the Dutch
in the 1930s. And if necessary they were willing to accept these. But
to all of them it was absolutely clear that business is business and
that profits needed to be made for the good of the company and the
families dependent upon it. In their minds there was no such a thing as
a black market or illegal trade; all trade was considered acceptable
under the Japanese war economy. It was the niches in this controlled
and military-run economy that should be used optimally, and it was
considered not business-like if these opportunities were not fully used.
If temporarily hoarding goods would mean getting a better price later
elsewhere, this was considered a quite logical and rational business
practice.26 This of course was not an attitude solely of the Oei family
24
Interview Jack Oei Tjong Ie, Singapore, July 2004.
25
Economisch Weekblad voor Nederlandsch Indie (EWNI), April 20, 1946, 12e jrg. No. 6: 45.
26
Interviews Tan Swan Bing, Jack Oei Tjong Ie; Personal Memoir Tan Tek Peng.
On the so-called collaboration of OTHC and the reactions to it, see Twang (1998,
8691).
188 peter post
and its managersmost Chinese Indonesians tried to adapt to the new

rulers and for strategic reasons often collaborated, thereby adher-
ing to the Japanese principle that Chinese capacities and commercial
talents should be properly utilized for the purpose of our Southern
construction (Twang 1998, 90).
Members of the Chinese elite families like the Oei, Be, and Kwee
in Central and East Java did not seem to have suffered much under
the Japanese. In their mountain resorts where most stayed during the
period there was always plenty of food and clothing, they had their
servants to look after them; and in the cities they kept on entertaining
themselves at dancing and dinner parties, in the cinema, did some
occasional fun shopping and even went on tourist outings. The major
problem they had was that luxury items like cars and pianos were
confiscated and that life in general was boring, since traveling around
freely became hazardous and families and friends could not easily
been seen. To many the major difference was that in the streets and
the public space white faces gradually disappeared, but since most
of them hardly mingled with the Dutch, British, and Americans, this
too was accepted as a fact of the new life.27
Things became different once it turned out that Japanese economic
policies did not produce the anticipated results and the war economy
demanded a full restructuring of the Javanese economy. Central to
Japans concern was rice production and rice distribution (Sato 1994,
11553). This meant, for example, that the sugar factories had to trans-
form their estates into paddy growing fields and that the sugar industry
had to cut back its production. All these measures demanded a strict
control over prices, production, and distribution. Economic control
became the catch-phrase and was implemented from the higher lev-
els of the (international) economy to the local level of the Javanese
27
This didnt mean, however, that there were no personal hardships and tragedies.
On the contrary. Chinese elite members did not only suffer from the Japanese kenpetai
for political reasons, but also simply because they were rich and wealthy and belonged
to the upper layers of society. And not only the native population, but many in the
lower ranks of the Japanese military and the civilian administration, enjoyed hassling
them and making it physically clear that their life of luxury was over. Tan Tek Peng
spend three weeks in jail and was severely beaten by the kenpetai, Tan Swan Bing
was accused of anti-Japanese behavior and dangerous thoughts and was sent to
prison for eight months from mid-1942 until early 1943. Whereas Jack Oei Tjong Ie,
always a rebel and not afraid of the devil himself, hid Moluccan soldiers in his house
in Surabaya and secretly listened to the BBC radio, was sentenced to death in early
1943 and spend the occupation period in a kenpetai prison in Jakarta.
peasantry. In practice these measures were to no avail, actually lead-

ing to a thriving black market, hoarding of agricultural produce, an
increasing discrepancy between urban and rural areas accompanied
by the dismantling of social-economic structures in the peasant soci-
eties, and an increasing poverty among the Java population. On the
other hand, it also affected the field of operation of trading companies
like Kian Gwan, and demanded much of the individual business tal-
ents of senior staff and managers.
Social-Political Roles
On the social and political level, Oei Tjong Hauw and Tan Tek Peng
played important roles under Japans military rule. Both became cen-
tral figures in Japanese efforts to organize, seek cooperation from and
deal with the Chinese in Central and East Java. In December 1942,
under the energetic leadership of Toyoshima Ataru, a Preparatory
Committee for the Foundation of a General Association of Chinese
Immigrants was established for which Tjong Hauw and Tek Peng
were also invited.28 Six months later, all over Java local Chinese
Associations were formed, which oversaw and directed socio-politi-
cal and cultural developments within the Chinese communities. The
powerful Chinese Association (Kakyo Sokai) in Semarang was chaired
by Oei Tjong Hauw, whereas Tan Tek Peng acted as its vice-chair-
man. Other members of the Semarang Association were Oei Tjong
Ik and Oei Tjong Tjat, younger brothers of Tjong Hauw.29 Also, in
other Javanese cities members of the Oei family and staff members
of OTHC came to hold important positions in the Kakyo Sokai. His
brother-in-law Kwee Zwan Lwan for example was appointed chair-
man of the Kakyo Sokai in Cirebon. Holding these positions gave
28
Toyoshima Ataru came to Batavia in 1939 to head the Chinese Affairs Section at
the Japanese Consulate-General. In 1941 he was promoted to vice-consul. During this
period he was very active in gaining the cooperation and support of Chinese in Java
for Japans policies and established a wide-ranging network among prominent Chi-
nese leaders and influential Japanese in the Indies. See Didi Kwartanada An Expert
on Chinese Affairs or a Pacifier?: Toyoshima Ataru and the Campaign towards the
Chinese in Java, 19391945, paper presented at ICAS 4, Shanghai, August 2024,
2005.
29
NA, the Hague, Archive Procureur-General 2.10.17, inv. No. 411 Oei Tiong
Ham File.
190 peter post
people like Tjong Hauw, Tan Tek Peng, and Kwee Zwan Lwan much
negotiating power with the General Affairs Department of the Gun-
seikanbu (the most important department in the military administra-
tion) and made it possible not only to promote their own business and
private family interests, but also assist and help unfortunate members
of the Chinese community and the Dutch and Eurasian populations
that were interned. Tjong Hauws pre-war record as a secret and
silent business associate of the Nanking government and a friend of
Cheng Kung Po undoubtedly played a part in being accepted as a
trustworthy and reliable partner of the Japanese military.30 He was
also instrumental in setting up, under Japanese guidance and initiative,
a Committee on Overseas Chinese Voluntary Defense Army. The aim
of this defense army was twofold. One was to train and militarize
young Chinese in order to help the Japanese to defend Java in case
of an allied attack. Secondly, to set up a paramilitary Chinese self-
defense force that was undoubtedly necessary when popular unrest
might again turn against the Chinese. This committee was formed in
March 1944 and Tjong Hauw was appointed its chairman.31 Early
in 1945 this self -defense organization came into being and initially
counted around 2,000 members in Batavia alone.
In the meantime, Oei Tjong Hauw and Tan Tek Peng c.s. were
also in close contact with Indonesian leaders like Hatta and Sukarno,
and prominent pribumi businessmen, discussing the future economic
development of an independent Indonesia. In October 1943 the Japa-
nese set up the Chuo Sangiin (Central Advisory Board), which became
the key institution for political participation and economic matters.32
Oei Tiong Hauw was one of the four Chinese members of this all-
embracing council. His important and influential position during this
central year of the Japanese occupation can be gauged from a photo-
graph taken of the official installation of the Chuo Sangiin in October
1943.
30
Dutch sources also mention that he good relations with several kenpetai officials;
but this might also be due to the fact that he successfully negotiated the ultimate
release of his brother Oei Tjong Ie, who was sentenced to death. Nobody in the Oei
Family knew exactly how Tjong Hauw had been able to keep Tjong Ie from not being
executed by the kenpeitai.
31
Ministery of Foreign Affairs, The Hague, NEFIS Archives, Inv. no. 2756
Chineesche Beweeging.
32
On the Chuo Sangiin see Sato (1994, 6471) and Post et al. (2010, 4823).
Figure 2.
Source: Boekoe peringtanan Tyoo Sangi-in (s.l., Impressum, 1943).
In this picture we see Oei Tjong Hauw (white suite and black tie)
standing in the centre, third row, right behind Raden M.A.A. Kusumo
Utoyo (vice-chairman of the Chuo Sangiin) and next to Vice-Admiral
Maeda Tadashi. Sukarno (chairman of the Chuo Sangiin) is standing
in the centre, front row, whereas Lt.-Gen. Harada Kumakichi (Com-
mander-in-Chief of the Sixteenth Army) is standing in front.33
In April 1945 an Investigating Committee for the Peoples Economy
was established by the Japanese military. Indonesian pribumi business-
men dominated this committee, Tan Tek Peng being the only Chinese
representative, and when one month later the Investigation Body for
the Preparation of Indonesian Independence was inaugurated, Oei
Tjong Hauw gained a seat (Kanahele 1967, 100102, 1924; Twang
1998, 11819). In the discussions at these committees about the
future development of the Indonesian economy, it was made clear by
33
Maeda Tadashi (18981977) was head of the Naval Liaison Office in Jakarta and
played a decisive role in the final days of the Japanese occupation period when he
offered his residence to Sukarno and Hatta to prepare the Proclamation of Indepen-
dence. Harada Kumakichi (18881947) succeeded Imamura Hitoshi as C-in-C of the
Sixteenth Army (November 1942April 1945). Post et al. (2010, 499500; 5445).
192 peter post
Indonesian political leaders, such as Mohammad Hatta, that an inde-

pendent national economy should not be based on individualism and
capitalism but on socialist ideals, cooperatives and gotong royong. The
economic department of the Semarang Chinese Association expressed
its anxiety towards these plans and in a report said . . . According to
the opinion of this Department, the new economic institutions will
end up in a controlled economic system. [. . .] The Department deeply
hopes that Chinese businessmen will exhibit their ability to adapt to
the new trends . . . (op. cit. Twang 1998, 121).
During the final months of the Japanese occupation it was clear
that Oei Tjong Hauw and Tan Tek Peng planned to play a significant
role in the build up of a national economy in Indonesia. They were
in the major economic and political boards, and were without doubt
the most prominent Chinese businessmen in these boards. In this effort
they were supported by the Japanese. But as time passed, increasing
pressure from Indonesian nationalists resulted in a deepening of the
cleavage between the Chinese and Indonesian business classes. These
conflicts of interest were not only economical but also religious and
political, and reached a high point when the citizenship issue was dis-
cussed in the Investigation Body for the Preparation of Independence.
Oei Tjong Hauw wanted the future Indonesian government to declare
all Chinese in Indonesia Chinese citizens, promising that as citizens
of China he and his people would do their best to help the people
of Indonesia to establish an independent country (Suryadinata 1986,
5960). When it became clear that the Indonesian nationalists in this
Investigation Body only wanted to give pribumi Indonesians automatic
citizenship in an independent Indonesia, the peranakan capitalist elites
were highly disappointed. In this atmosphere Oei Tjong Hauw took
a drastic step. Rather than having his stakes solely in an independent
Indonesia, he decided on July 11, 1945 to become a citizen of China,
thus becoming the first and the wealthiest among the Chinese to
make such a decision in Indonesia (Twang 1998, 126).
So, when the Committee for the Preparation of Indonesian Inde-
pendence was established on August 14, 1945, there was only one
Chinese member, Dr. Yap Tjwan Bing. But he could hardly be con-
sidered a representative of the Oei business fortunes. Oei Tjong Hauw
apparently did not desire a seat in this important committee. He prob-
ably reasoned that being an alien citizen in an independent Indonesia
might give him better chances to protect his property, if events would
turn against them. Moreover, being a Chinese citizen would give him
better chances to escape accusations of collaboration, and even impris-

onment when the Allied and Dutch forces would return victorious
(Twang ibid.).
OTHC and the Republic of Indonesia
The first priority after Indonesias independence was to find out the
state of the present assets of the firm. To that extent, Oei Tjong Yan
and Oei Tjong Ik (younger brothers of Oei Tjong Hauw) traveled the
interior of Java. In addition the overseas offices had to be checked. Oei
Tjong Ie, despite his experiences with the brutal kenpetai regime, went
to Japan, Hong Kong, and Shanghai, and Tan Tek Peng undertook a
trip to Singapore, Bangkok, and Calcutta. It turned out that only the
offices in Bangkok and Calcutta had done relatively well under Japans
Greater East Asian Co-prosperity Sphere. The administrations were
in order and office expenses were successfully met. Bangkok had even
made profits. Shanghai and Singapore were in a distressful situation
and the offices in Tokyo and Osaka had been abandoned. The Kian
Gwan office in London had been destroyed by German air raids dur-
ing the war in Europe and a new office building had to be found. In
Indonesia itself, fighting between Republican forces and Dutch troops
resulted once again in the destruction of sugar factories and planta-
tions; and after hostilities came to an end it was soon found that the
production capacity of 1.5 million tons of sugar was reduced to a half
million. It also became clear that the factory equipment of the Tang-
goel Angin sugar factory had been looted by Japanese military and
that the Krebet and Ponen factories were destroyed; also, the Krebet
flour factory was reduced to ashes. In Palembang, Kian Gwans rub-
ber factory including the stocks had gone into flames. Only the Redjo
Agoeng and Pakkis factories had remained intact and continued pro-
duction. Kian Gwans plantations in West Java as well as its real estate
and storing facilities in the province were also not affected by the war
and the fighting between Dutch and Indonesian troops.
Despite these heavy losses, Kian Gwan was soon able to rebuild
itself. In 194748 it expanded its foreign representations and erected
new branch-offices in Amsterdam, New York, and Rangoon (for the
import of rice). Having established a separate import department in
1931 bore fruit, especially in the period 194750, when the company
was able to get a big share of the importation of general commodities
194 peter post
at the expense of the returning Dutch trading firms. On the other

hand, competition in the distribution of sugar for local consumption
got bigger, when large Dutch trading firms like Internatio, Borsumij,
and Wellenstein Krause also started to compete with the local Chinese
sugar dealers, especially in Semarang and Surabaya.
During this period it also became increasingly clear that in Indo-
nesia the institutional environment to conduct business was changing.
Hattas call for a socialist capitalism based on the spirit of mutual
self help (gotong royong) which rejected laissez-faire capitalism and impe-
rialism and strived toward the creation of a welfare state and society
based on justice for all, penetrated all levels of the social economy
and forced Chinese businessmen to rethink their objectives. Doing
business was no longer to make profits, but to serve the community,
the country, and the nation (Tjoa in: Yoshihara 1989, 87). This
meant for OTHC that the interests of the Oei family members who
controlled the company had to be made secondary. Previously the
company prospered under the climate of private initiative, but now it
became subjected to the influence of the government much more than
ever. This demanded a complete mental change among the person-
nel as well as the family shareholders (ibid.).
The first major task Oei Tjong Hauw set for himself was to reshuffle
his management staff and mid-level personnel. Many staff members
and branch managers in the conglomerate found it difficult, or were
unwilling, to adapt to the new circumstances. Some who had sufficient
capital left the company and went to the U.S., Europe, and Australia
to start a new life; others simply refused to implement the social-
ist spirit. In addition, several managers had started lucrative enter-
prises under Japanese military rule and were not willing to return to
OTHC. Reassigning tasks had also become necessary since, under
the Japanese and now under the Indonesian government, it turned
out that personal relations and private connections with the proper
higher authorities did not necessarily relate to the fixed hierarchical
order within the firm. Junior staff, because of their personal acumen,
more often than not had better and more trustworthy relations within
the new regime than the older and more senior members, many of
whom were Dutch- or China-oriented. In addition, OTHC had to
give responsible positions and management tasks to Indonesians as
part of the government-pushed Indonesianisasi process. In maintaining
close relations with the government the headquarters moved from
Semarang to Jakarta.
In this reorganization process Tjong Hauw and Tan Tek Peng also
had other important and probably more pressing matters at hand. Until
that time tasks and responsibilities within the senior-management of
the conglomerate were clearly defined and accepted by everyone. But
since the outbreak of the war in Europe the four sons of Oei Tiong
Hams seventh wife Lucy Ho, all of them shareholders, had reached
maturity and now after the Japanese surrender started to claim their
rights.34 It was decided that the three elder brothers would be assigned
as managers of respectively the Singapore, Bangkok, and Hong Kong
offices, while the youngest one, Oei Tjong Tjay, would work in the
Jakarta office under the guidance of Tjong Hauw.
While he was in the middle of this reorganization, Oei Tjong Hauw
suddenly died of a heart attack in Jakarta on January 21, 1950. With
his death OTHC suddenly lost its one-man leadership and a most
capable and knowledgeable president-director, well-connected in fast
changing Indonesia and the rest of Asia.
Aftermath
Under the single directorship of Oei Tjong Hauw the rationale of the
conglomerates structure could still be considered business itself, but
after his death the rationale of the conglomerate became the compli-
cated family structure.35 The main division being the cleavage between
the, what was called, Hauw and the Ho groups. The Hauw group con-
sisted of the younger brothers of Oei Tjong Hauw, namely Oei Tjong
Tjiat, Oei Tjong Yan and Oei Tjong Ik, and included Oei Ing Swie,
eldest son of Tjong Hauw. The Ho group consisted of the four sons
of Ho Kiem Hoa Nio (Lucy Ho). Since neither allowed the other full-
control, it was decided to split the group into geographical divisions.
The American continent and Europe came under the directorship
of the members of the Hauw group, and the Asian division and its
34
These were Oei Tjong Ie (b. 1918), Oei Tjong Bo (b. 1922), Oei Tjong Hiong
(b. 1923) and Oei Tjong Tjay (b. 1924).
35
Many large family businesses, especially in countries and cultures were polygamy
is still practiced, currently face the same problems. See http://pabs.netfirms.com/
chapter8.htm Chapter 8 Polygamy and Family Squabbles submitted by the Phoenix
Group for the College of Management, University of Philippines. Accessed on July
1, 2008.
196 peter post
various branches under the Ho group. The all important Indonesian

division came under Tjong Tjay (Ho Group). That Tjong Tjay who
had spend most of his life with his mother in Switzerland and The
Netherlands and had no Indonesian experience whatsoever came to
head the Indonesian division was not favored by everyone. Particularly
Billy Oei Ing Swie, eldest son of Tjong Hauw, who knew the ins and
outs of the Republics socio-economic environment quite well, had
expected to be given this important and lucrative position. The family-
oriented structure of the conglomerate was specifically based upon the
personal wishes and ideals of the shareholders. Several of them had
no wish whatsoever to continue their lives and raising their children in
a socialist Indonesia where anti-Chinese sentiments became stronger
by the day.
In the new and loosely knit structure of the conglomerate each of
the shareholder-directors was responsible for his own division, which
stood primarily on its own. Although the global offices and branches
operated under the name Kian Gwan there was no shared capital base
although arrangements were such that it was extremely difficult for
individual members or factions to withdraw equity. Within the overall
structure the Indonesia division was by far the most important since
all the other offices received goods and services from Indonesia, and
exported capital, consumer goods, and foodstuffs to Indonesia mainly
through the main office in Jakarta, sometimes by way of the Singapore
office. Each of the director-shareholders could, and would, develop
their own projects within their regional division and in doing this
didnt need consent from the others. Only in the case of a large proj-
ect for which shared capital was needed, specific shareholder meetings
would be held to seek mutual support. The construction the brothers
came up with might have worked if they trusted and respected each
other and kept the interest of the family business group as a whole in
mind, rather than their own private and family interests. But it soon
became clear that, mainly due to inheritance rights, tension among the
brothers was mounting, which had a great impact on the subsequent
events.
It goes too far to detail these events in this essay. Suffice it to say
that by the late 1950s, when the Indonesian government had decided
to nationalize Dutch firms, pressure was mounting on the Oei Tiong
Ham Concern to adapt itself to the new institutional environment.
Unable to come to an internal agreement about the future course
of the company in Indonesia, mistakes were madewhich involved
among others the illegal transfer of capital to The Netherlandsand

in 1961 a lawsuit was started by the court of Semarang aimed at the
confiscation of OTHC assets and the private property of its directors.
After the seizure, the company became government property, and in
October 1964 its legal successor was born, the PT Perusahaan Perkem-
bangan Ekonomi Nasional Radjawali Indonesia (Enterprise for the Develop-
ment of the National Economy Radjawali Indonesia), or in short PT
Radjawali Indonesia. By that time the Oei brothers had already left
the country and had started business elsewhere in the world.
Concluding Remarks
Despite the regime changes of the central decades of the twentieth

century in Indonesia, Oei Tjong Hauw and his professional manag-
ers were quite successful in sustaining the various businesses of the
OTHC. They aggressively stepped into new economic opportunities
that offered themselves in the depressed 1930s, investing in sectors
(rubber, tapioca, maize, alcohol production) they had disregarded
before, moving into new regions and promising new markets (U.S.,
China, and Japan), rationalizing their businesses and making use of
the latest technology available. Under the Japanese wartime economy
they accepted its restrictions and demands, creatively adapting to the
new rules of the game. And in the early years of the Sukarno regime,
Oei Tjong Hauw seemed to have been successful in reorganizing
his managerial staff in order to adjust the OTHC to the demands
of the socialist economy that the Republic envisaged. The Oei fam-
ily director-shareholders and their senior professional managers didnt
identify with one particular nation or ethnicity. They were first
and foremost global citizens or global entrepreneurs, not particu-
larly bound to colonial borders, nation-state imageries, or East-West
dichotomies. They were part of a global, highly modernized elite that
felt equally at home in the rustic mountain areas of central Java and
Switzerland, the buzzing metropolises of Shanghai, Singapore, New
York, and Tokyo, the glamorous canal cities of Amsterdam and Delft,
or the artistic centers of Paris. Therefore, trying to understand their
business strategies during the Japanese period in terms of collaboration
and resistancewhich in essence means identification with a nation
to which one can be loyalis missing the point. The loyalty of Oei
family members was with the survival of their global business interests
198 peter post
and the interests of families that dependent upon the OTHC, nothing
more . . . and nothing less.
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CHAPTER NINE
CONTINUOUS AND DISCONTINUOUS CHANGE

IN ETHNIC CHINESE BUSINESS NETWORKS:
THE CASE OF THE SALIM GROUP
Marleen Dieleman
Introduction
Ethnic Chinese family businesses are important players in many of the

Southeast Asian economies, and have received considerable attention
from academics. One of the key factors that have been researched is
the networking behavior and relational competencies of ethnic Chi-
nese businessmen. The way ethnic Chinese relate to others and cre-
ate business partnerships is often framed in terms of ethnic networks
(Granovetter 1992; Kotkin 1993; Rauch and Trindade 2002; Douw
1999; Redding 1995) and in terms of crony connections with politi-
cians (Yoshihara 1988).
Recent studies, however, question the importance of crony and ethnic
networks on ethnic Chinese business strategy and place more emphasis
on exogenous factors. These authors argue that the influence of net-
working for ethnic Chinese groups is overstated (Chung 2006); ignores
intra-ethnic diversity (Gomez and Hsiao 2001); has changed, or has
been renewed with the influences of globalization (Carney 2005; Yeung
2006); or may be of a temporary and passing nature (Peng 2003; Peng
and Zhou 2005). Institutional theorists looking at external changes and
their impact on ethnic Chinese networking generally attribute a minor
role to ethnic and crony networks in the behavior of ethnic Chinese
business groups, and a major role to exogenous factors such as institu-
tional changes. As a consequence of these new contributions, the cur-
rent status quo of academic knowledge in this field is challenged and
the debate has opened up new possible lines of research. How do ethnic
Chinese business networks evolve over time, and what factors account
for changes in the composition of the business network?
Institutional changes can be continuous and gradual, in which case
it is not easy to single out their impact on business networking. A
202 marleen dieleman
situation in which one is in particular able to assess the effect of envi-

ronmental factors on business networks, however, is when the business
environment displays a discontinuous or radical change, such as an
economic or political crisis followed by a new institutional environ-
ment with new economic policies and political players. Indonesia has
gone through various fundamental changes, which allows scholars to
investigate: what is the influence of external factors such as regime
changes on ethnic Chinese business networking?
Until today, very few studies have addressed the dynamics of ethnic
Chinese business networks. This chapter attempts to fill part of this
gap by presenting data on the business network evolution over time,
covering the historical period before, during and after the Asian Crisis
of 199798. This study makes use of qualitative and quantitative longitu-
dinal case data of the Salim Group, one of the largest ethnic Chinese
firms in the Asia Pacific region. A time-series approach using cod-
ing of qualitative data is proposed as a promising method to study
gradual, long-term developments in business networks, as well as sud-
den changes resulting from external shocks. In this article I address
the question how ethnic Chinese networks change over time and in
periods of economic and political crisis. I bring in various theoreti-
cal concepts and assess whether they are suitable to explain network
dynamics over time.
The chapter proceeds as follows. The first section reviews different
network theories applied to ethnic Chinese business. The second sec-
tion introduces the case and methods used to obtain and analyze the
data. The third section presents the case results. The fourth section
offers a discussion of the results, and finally, I present my conclusions
and suggestions for future research.
Four Perspectives on Ethnic Chinese Business Networks
Research on ethnic Chinese family business is carried out in a variety

of scholarly disciplines ranging from anthropology to management.
As a result, the literature on this topic shows considerable variety, and
there are different ways to classify the literature. I focus here mainly on
business networks in ethnic Chinese family firms, which is the topic of
this paper, and draw mainly from literature from sociology and man-
agement, framing the debate into categories that are common in these
disciplines. Obviously, not all Chinese firms are family firms, but our
the case of the salim group 203
focus is here on networking behavior by family firm owners of Chinese

descent operating outside China. Most literature on this focuses on
small firms, but this article deals with those few family firms that grew
into large conglomerates.
The notion that firms are embedded in social networks is well-
known in sociology (Bonacich 1973; Granovetter 1995; Portes and
Sensenbrenner 1993) and has also been researched within the field
of management (Gulati 1998; Uzzi 1997). Especially Asian firms are
thought to be heavily embedded in social networks (Buckley 2004).
Ethnic Chinese firms are often treated as a separate category of firms
with specific characteristics, and are often referred to as the Chi-
nese Family Business (CFB) or more broadly as Chinese capital-
ism (Haley 1998; Hamilton 1991; Redding 1990). Although there
is overlap between them, I identify four different types of theoretical
approaches that are relevant for the study of ethnic Chinese business
networks.
First, ethnic Chinese businessmen are believed to prefer forming
business networks with fellow Chinese, in particular those of the same
region of origin in China. A large number of popular as well as aca-
demic studies have been produced on the importance of ethnic Chinese
networks (Backman 2001; Chan 2000; Douw 1999; Redding 1995;
Weidenbaum and Hughes 1996). Some authors argue that the intra-
ethnic Chinese networks are instrumental in overcoming trade barri-
ers, and as such offer a competitive advantage. In particular when the
environment for business is uncertain minority networks are argued to
make a difference as they compensate for weak or missing institutions
(Bonacich 1973; Rauch et al. 2002; Xin and Pearce 1996). In other
accounts researchers often argue that the specific Chinese culture and
Chinese networking styles are one of the reasons behind the formation
of such intra-ethnic networks (Hong 1998). Ethnic Chinese business
behavior is argued to be particularly influenced by Confucianism and
guanxi (Haley 1998; Luo 1997; Redding 1990). Businessmen of Chinese
descent are argued to value trust in relationships with others. In Chi-
nese society personal networks extending from the individual exist, and
each type of relationship is regulated according to social conventions
(Fei 1992). Chinese networks are commonly termed guanxi. Guanxi
means connections and refers to personal, particularistic relationships
between two individuals. The relationship implies a long-term process of
exchanging favors (Chen and Chen 2004). The basis for guanxi can be
a shared experience, for example the same place of birth or the same
school, the same clan, the same surname, the same family, and so on.
As such, it is easier for Chinese people amongst themselves to develop
guanxi than for Chinese with people of other nationalities. Business
networks, in this perspective, are thought to be stable attributes of fam-
ily leaders, and provide a cushion to mitigate effects of external hard-
ships. To the extent that personal networks change, it is attributed to
internal factors, such as the size of the firm and the wealth of its leader.
Sociologist Fei (1992) argues that the more powerful the person, the
more extended are its networks, which is consistent with the idea that
larger and more powerful family conglomerates maintain an elaborate
web of ties with other Chinese businessmen.
A second body of literature focuses on another type of network: the
crony connection. It argues that ethnic Chinese businesses developed
corrupt relations with power-holders, who provided resources or pro-
tection, in exchange for money or shares (Robison 1986; Yoshihara
1988). Local political figures, particularly in Indonesia, were keen to
establish crony links with Chinese businessmen because they could
derive economic benefits from this alliance without the other partner
forming a threat to political power and because they could more easily
be kept at bay (Suryadinata 1997). The fact that a leader like Suharto
linked up with various ethnic Chinese businessmen is understood in
this manner (Elson 2001). The allocation of certain advantages due
to connections is usually seen as either rent-seeking (Yoshihara 1988),
corruption, or crony capitalism. Corruption involves bureaucratic
behavior that deviates from the norm and that results in private gains
by bureaucrats (Luo 2002). Cronyism is argued to be a special type of
corruption, based on repeated relationships. It can be defined as a
reciprocal exchange transaction where party A shows favor to party
B based on shared membership in a social network at the expense
of party Cs equal or superior claim to the valued resource (Khatri,
et al. 2006). Political economists working on Indonesian conglomer-
ates see crony relations with the regime as the key factor underpinning
ethnic Chinese business success (Chua 2007; Robison 1986). Most of
the literature on crony connections has stressed the beneficial effects
of maintaining such network ties for firms, as well as the fact that
such ties are inappropriate or undesirable from a macro-economic
development perspective. However, from the perspective of a business
leader, there are also profound risks associated with crony relation-
ships, namely that the carefully cultivated political connection might
fall from power (Fisman 2001; Leuz and Oberholzer-Gee 2006) or
uses his or her political leverage to acquire the firms resources (Fan,
Won and Zhang 2007). As such, an external shock such as a regime
change may profoundly affect the political ties themselves and also
have an impact on the composition of a family business network.
Third, networks are often analyzed using the concept of social capi-
tal, referring to the ability of company leaders to use networks as a
business resource. In situations of uncertainty and low levels of trust,
strong business networks reduce transaction costs if they create higher
levels of trust among their members. This can be the case of families
(Burkart et al. 2003), of communities (Lester and Cannella 2006), in
school or political networks (Keister 1999), in ethnic networks (Bon-
acich 1973; Rauch and Trindade 2002), or in the entire society (Fuku-
yama 1995). Together, personal connections of business owners that
are used for the benefit of the company can be referred to as social
capital. Given its broad scope, social capital applies to both categories
mentioned above as it encompasses all relations firm owners possess
that can translate into value for the firm. The concept of social capital
is also often used in the field of management to describe the advan-
tage companies can have as a result of their network ties (Adler and
Kwon 2002; Blyler and Coff 2003; Nahapiet and Ghoshal 1998). It
is now common to distinguish between bonding and bridging capital,
where bonding is building connections within the own social group
and bridging refers to networking with people across social categories
(Adler and Kwon 2002). Following this classification, crony capitalism
can be seen as bridging capital whereas family and ethnic networks
would be seen as bonding capital.
A fourth body of literature which can be called the evolutionary
approach introduces the time aspect and considers network strategies
as a dynamic attribute of organizations (Blyler et al. 2003; Hite 2005).
Some authors have criticized the attribution of omnipotent powers to
ethnic Chinese business networking, and have argued that, as the busi-
ness grows and its environment develops, guanxi and networking with
political figures is not as important as in early stages (Chung 2006;
Peng and Zhou 2005). Institutional theorists see the networking behav-
ior as a reaction to an imperfect business environment. Once strong
economic institutions arise and a liberal market economy emerges,
these authors believe that ethnic Chinese companies will naturally
move from a relational model towards a rule-based model with weaker
network ties (Peng 2003; Peng and Zhou 2005). In doing this these
authors adhere to a stages model of economic development and expect
convergence over time. Some recent studies on ethnic Chinese firms

have already hinted at the influences of globalization (Ahlstrom et al.
2004; Yeung 1998) and at recent changes in ethnic Chinese business
networks (Dahles 2005; Gomez and Hsiao 2001). Although there are
indications that the Chinese Family Business is changing, precisely
how this process evolves, and what this means for networking behav-
ior, is yet to be investigated.
In summary, there is a debate on the importance and composition
of business networks among large ethnic Chinese family firms, as some
scholars argue that these networks change over time or cease to be
important, while others assume that business networking and focus
on building social capital from networks is an essential characteristic
of such firms. At present we dont have conclusive evidence on what
type of networks are most important for ethnic Chinese firms in dif-
ferent stages of their development, nor on whether business networks
will continue to be important when economies in Asia witness policy
shocks or slowly move towards a liberal and open market economy
model. This essay is positioned within this debate and I investigate
how business networks change over time, and in particular in times of
major external shifts in the business environment, using a single case
study.
Based on the literature review, we can formulate different prop-
ositions, which correspond with the different positions in the above
mentioned debate. One is that network ties with other ethnic Chinese
businessmen will be predominant within the overall network of an
ethnic Chinese firm, and that this will be a stable factor, not affected
by regime change. The size of the business network depends on the
size of the firm, rather than on external factors. The second is that
political ties will be predominant within the overall network of an
ethnic Chinese firm, but that the nature of such ties will be affected
by political changes. A third proposition is that the number of network
ties will gradually decrease as a country modernizes.
I agree that networking behavior should be treated as a dynamic
attribute of organizations, and rather than establishing theories on net-
working behavior of ethnic Chinese firm as such, it is more useful to
study network composition in an evolutionary manner. Therefore, I
present a longitudinal case study of one of the largest ethnic Chinese
groups in Southeast Asia in which I attempt to measure the network
composition over time.
Methodology
It was decided to focus on a single case in order to observe in more

detail and with more rigor how the evolution of ethnic Chinese busi-
ness networks may play out over a longer period. The Salim Group was
selected on theoretical sampling principles, which means that, rather
than being representative of a larger population, the case was chosen
because the phenomenon of interest was transparently observable
(Eisenhardt 1989). The Salim Group was (and most argue that it still
is) the largest and most prominent group in Indonesia, and it oper-
ated a large number of businessesestimates are several hundredin
cooperation with various partners.
We present a rich longitudinal, exploratory case study of a corpo-
rate group within its institutional context covering a period from its
inception in 1938 to 2005. The research was carried out from 2003
05 using a variety of sources including fifty-six interviews, sixty-nine
annual reports (covering ten years), media sources, secondary litera-
ture, and corporate documentation. It consciously had some overlap
between data collection and analysis to strengthen emerging themes
(Glaser and Strauss 1967), and in the analysis I emphazised triangula-
tion (Yin 2003), or trying to make conclusions only if different sources
converge in the same direction.
I used a mix of methods in order to evaluate the business network
over time. The first is interpretative based on a triangulation of the dif-
ferent sources, the second is a coding procedure to transform qualita-
tive data into quantitative data (Boyatzis 1998). The unit of coding was
a new business event, defined as any relevant business decision outside
continuing the existing businesses. Examples are starting new ventures,
spinning off companies, or expanding existing lines of business. After
a combination of sources and a complete reorganization of the data, a
list of 262 relevant business events was obtained for the period 1984
2003, or two decades. The data did not allow extending the analysis
to a longer period, as there were too little data points before 1984.
Hence, the networking behavior from 193884 is assessed using only
interpretative techniques and the quantitative method is applied only
to a limited period of development. This is due to two things: first, less
information was available before 1984 in international news publica-
tions, and most companies were not yet on the stock exchange. The
second reason is that the smaller the group, the less data points. The
method I used increases in reliability with larger groups, because these

have more partners and therefore more data points.
Subsequently, each event was assessed in terms of partnerships in
the categories: 1) ethnic Chinese, 2) political connection, and 3) for-
eign (non-Chinese, non-Indonesian) partners. Ethnic Chinese part-
ners where defined as anyone of Chinese descent, either in mainland
China, or outside. Political connections included business ventures
with governments, military leaders, or with family member of high-
level political figures, either in Indonesia or abroad. Foreign partners
were broadly defined as non-ethnic Chinese and non-Indonesian, but
in practice this group consisted mainly of Western and Japanese busi-
ness partners.
For each business event the presence of one or more new partner-
ships in these categories was counted. The analysis of case data can
suffer from biases of the researcher which unconsciously influence the
actual coding. To control for this potential bias the reliability of the
coding process is normally tested by using other peoples judgments
and comparing these with the researchers judgments. We used inter-
rater reliability by measuring the percentage agreement on presence.
The formula recommended for this type of presence/non-presence
scoring is (Boyatzis 1998):
2 x (number of times both coder A and coder B saw theme present)
(number of times coder A saw it present + number of times coder B saw it present)
An independent second researcher, unfamiliar with the research, vali-
dated the process and repeated the coding. I achieved an interrater reli-
ability of seventy-five percent (ethnic Chinese partners); seventy-seven
percent (crony partners), and seventy-six percent (foreign partners). A
score of seventy percent is normally considered sufficient. The results
were aggregated by year and plotted on a time-scale. In addition to
quantitative data, qualitative information from the original sources is
used in interpreting the results. Naturally there are limitations inher-
ent to techniques to quantify qualitative research, as I used here. For
example, we do not measure the importance of a partnership. One
partnership could be more important than ten others together. Instead
we only measure occurrence. To overcome the shortcomings of this
method, I also used interpretative techniques as I had detailed infor-
mation on each of the events identified.
For the purposes of this essay a short overview of the Salim Group
will be given, while a more elaborate analysis is available elsewhere
(Dieleman 2007; Dieleman and Sachs 2006). All quotes used stem
from interviews with the author, unless otherwise attributed.
The Salim Saga
Liem Sioe Liong, a poor Chinese migrant to Kudus (close to Sema-

rang) in Indonesia in the late colonial period, built up his business
slowly from scratch using the motto all business is good, until he
controlled a conglomerate that was considered the largest in Southeast
Asia (Sato 1993). His early start in business in the 1940s was facilitated
by family members and Chinese clansmen and it mainly involved
small scale trading, according to one source, by transporting goods
between cities on a bicycle (Twang 1998). The Second World War
and the Japanese occupation offered opportunities for trade or smug-
gling, even though it was dangerous. Liem never became entangled in
colonial organizational patterns such as exporting commodities, as the
successful conglomerates of the time, including Oei Tiong Ham, did
(see the chapter by Post in this volume).
After Indonesias Declaration of Independence, Liem started to sup-
ply different goods to a division of the army and became a trusted
supplier and business partner. In relation to this supplier role, he
also undertook some industrial activities, like a soap factory, but still
on a small scale (Soetriyono 1989). The period after independence
saw a parallel rise of two important institutions: the army, which was
a strong force in society and in business, and the communist party
(Crouch 1978). Sukarno, Indonesias first strong leader, focused on
nationalist policies by balancing these forces without being interested
in creating a favorable environment for private business. Indeed, in
the late 1950s, foreign business was nationalized; and the largest Indo-
nesian-Chinese conglomerate of that time, the Oei Tiong Ham Con-
cern, followed in 1961. This made the state the single most important
player in the economy. The business context for private firms at the
time was erratic, and the motto that all business is good may have
been a good survival strategy in a risky context. Because of Liems
relationships with a local army unit, he achieved stability and income
as a supplier, a position in which he was lucky enough to partner with
a relative of Sukarno, as well as to meet Suharto, who was later to
replace Sukarno after a bloody regime change that crushed the com-
munist party.
After Indonesias independence Liem moved to Jakarta and diversi-

fied into banking and manufacturing and supplied a variety of goods
to the military. The foundations for the Salim Group were created
during the Suharto period, with whom Liem held close contacts. The
coincidence of a close relationship with a long-term dictator of a large
country profoundly changed the Salim Groups outlook. When Suharto
came to power, in 1965, Liem had already built a substantial set of
business activities, despite high inflation and economic decline during
Sukarnos rule. Suharto soon realized that achieving strong economic
growth was an essential aspect of political legitimacy (Elson 2001); and
his competent economic advisers (also known as the Berkeley mafia)
created the conditions for a thriving economy in which private capital
was encouraged and international trade allowed, although key indus-
tries such as oil remained in government hands.
With foreign capital nationalized and private business constrained,
few successful and substantial businesses existed in post-colonial Indo-
nesia. Along with a few other Chinese businessmen, Liem was among
the favored ones that were enlisted by Suharto to help develop Indo-
nesiaand Liem took full advantage of his management skills, tact,
relations, and the opportunities offered to him. In addition, the eco-
nomic growth created local demand for all kinds of products, so a
domestic business strategy seemed most logical. Often in partnership
with army foundations linked to Suharto, his business group started to
grow at a very rapid pace, and to diversify into producing all kinds of
basic products from food to automotive to cement, while continuing
lucrative trading activities (Robison 1986). The industrialization of the
Salim Group coincided with a policy of import substitution industrial-
ization, which facilitated development of local capitalists. Most of the
Salim Group businesses produced products for the domestic market
in Indonesia, benefiting from the increased consumer buying power
achieved under Suhartos rule.
Without significant assistance from the government in terms of
credits and issuing of special licenses this rapid growth could not have
been achieved. Until the mid 1970s it was able to ride the waves of
opportunity and build managerial competencies necessary to exploit
the opportunities that came with Indonesias awakening and its new
leadership style. Widening his group by including some new investors,
both Chinese and Indonesian, including a Suharto family member,
Liem was now well prepared to become the largest business group in
Indonesia, and eventually the largest family business group in South-

east Asia.
In this thriving business environment, helped by a friendly dictator,
Liems Salim Group grew spectacularly into all kinds of industries.
In order to achieve this growth, it first partnered with a number of
domestic groups, managed by other ethnic Chinese. Also, it established
partnerships with foreign firms in Indonesia in order to obtain technol-
ogy or capital for certain ventures. In this way, the Group became the
leading conglomerate in Indonesia in the 1980s.
The Salim Group also expanded internationally to Hong Kong and
Singapore in the 1970s and 1980s, initially benefiting from the regional
ethnic Chinese networks. The Group also established footholds in the
U.S. and Europe and was considered the largest Southeast Asian busi-
ness group in the 1990s (Sato 1993). In Asia, some of its businesses
tapped into the ethnic Chinese networks in the region, whereas others
benefited from partnerships with Japanese or American firms.
In 1972 an important internal change occurred, the graduation and
return from the UK of Anthony Salim, the son of Liem who was to
take over the leadership over the group two decades later. With an
ever expanding empire to take care of, the young heir foresaw two
complications. First, the need to make the existing businesses more
streamlined and professional so that the group could effectively grow
and still be controlled by scarce family management resources; sec-
ond, the need to distance the Salim Group from a highly profitable
but equally risky dependency on a benevolent patron and dictator
who was mortal and certainly was not going to stay in power forever.
Anthony Salim started to use the group profits from domestic activities
to invest in countries outside Indonesia, such as China, Hong Kong,
and the Philippines.
From 1972 thats when the crossover occurred. When we start to
become much more by design rather than opportunity driven. Design
in the selection of the business opportunity. (. . .) We still have the con-
tacts and contracts with the government. From 1979 we started to sort
of elevate ourselves from government to market based enterprise. We do
understand a lot of political implications, because we try to choose that
it is much more on business directions rather than government related
businesswhich is still good. Another characteristic is that of course we
start to balance our portfolio. We have no pretension to hide that we
have started to invest outside Indonesia since 1975, when we created our
Singapore and Hong Kong companies. (Anthony Salim)
This trend, which started in the 1970s, would finally bring about a
third of the conglomerate activities outside Indonesia two decades
later, but did not change its embedding in the Indonesian domestic
context. Rather on the contrary, the Salim Group grew to be the most
dominant domestic player with (semi-)monopolistic positions in a range
of industries such as cement and flour and chemicals, usually enjoy-
ing some degree of government protection. Although Liem looked to
Japan for successful business examples, such as the sogo shosha, Anthony
Salim, who had been educated in the West, implemented several West-
ern business insights that were modern at the time. Under the second
generation leadership the Group professionalized its management and
organization structure. A divisional structure was introduced, and vari-
ous companies became listed on regional stock exchanges and man-
aged by professional CEOs. Anthony Salim also sought to become
less dependent on a benevolent dictator. By the 1990s the Group had
established relationships with major banks and with many major mul-
tinational companies.
In the period up to the Asian Crisis crony capitalism was even more
widespread in Indonesia, with protection and special favors very much
in the open, particularly when it came to the special business endeavors
of Tommy Suharto, one of Suhartos children. This national context
was increasingly inviting criticism from the IMF and the World Bank,
which promoted a liberal free trade model with low or no protection
of local industries and players. When the Asian Crisis came to Indone-
sia Suharto was eventually forced by the IMF to curb the protectionist
policies favoring friends and family members.
By the time the crisis reached its full scale Suhartos position came
under increasing pressure and he eventually resigned. The demise of
Suhartos order had severe consequences for the Salim Group. Having
been so closely associated with the Suharto regime, they were seen as
a symbol of it. The group became a target for public anger, and the
family houseas well as several branches of the Salim-owned Bank
Central Asiawas set to fire. BCA, the largest privately owned bank
in Indonesia, had two of Suhartos children on its supervisory board,
and was subsequently victim of a bank run that depleted its resources
and was nationalized. The fall of BCA marked a new period for the
Salim Group. A new government, espousing anti-corruption policies,
took over from Suharto and recapitalized the bank, demanding from
the Salim family full repayment as well as a fine for the violation of
certain banking laws. The total amount fixed by the government was
approximately USD 5 billion.
The Asian Crisis led to violence against ethnic Chinese, and the
Salim Group became a symbol of the old crony regime. It suffered
political as well as physical attacks and was partly nationalized as a
result of repayments to the government. Liem, said to be disappointed
by the anti-Chinese riots in which his portrait appeared as a symbol of
corruption and crony capitalism, never returned from exile in Singa-
pore and let his son Anthony Salim deal with the crisis in Indonesia,
while another son, Andree Halim, withdrew and focused on smaller
businesses in Singapore and China. The leadership of the Salim Group
was thus, as a side-effect of the regime change and economic crisis,
suddenly centralized in the person of Anthony Salim, who faced the
critical mission to disentangle the group from the previous regime and
prevent a complete collapse.
As economic conditions worsened, most Indonesian businesses were
considered insolvent, and the new post-Suharto government had to
consider ways to restore the entire financial sector and the economy.
It created an entity that had to deal with ailing banks, most of them
belonging to conglomerates, of which the Salim Group bank, BCA,
was the largest. Ethnic Chinese were seen as the culprits for the crisis,
and the Salim Group was clearly a symbol of dirty crony capital-
ism. The new government came under enormous public pressure to
dismantle the companies that were previously cronies of Suharto, as is
witnessed in the statement of one of their partners at the time.
With the crisis the problems started. The pressure on the Salim Group
became enormous, at the time they were afraid for their lives. When
they had some idea that a Chinese hunt would become reality, they tried
to move everything out of Indonesia. The government was not fond of
Salim, and forced them out of our joint venture. It wasnt even legal;
we were not supposed to own hundred percent of the venture. For some
time we were in a very odd situation. We did not want the Salim Group
to exit from our cooperation, we were unhappy with this development.
(Western Joint Venture partner of the Salim Group)
While some of the large conglomerate owners were arrested, this never
happened to Anthony Salim, who opted for a strategy of cooperative
negotiations with the government. He handed over (shares in) 107
companies to pay the government, which meant the nationalization
of a large part of the Salim Group. Given this attitude, which even
its staunch critics praised, the group could now become a symbol of a
new post-Suharto era. Part of his luck may have been that the Salim
Group was too large to fall, employing over 200,000 people, most
of them in Indonesia. For a couple of years following the crisis, the
Salim Group reshuffled companies and assets in order to rearrange
their portfolio. Even after the settlement of the USD 5 billion govern-
ment debt, the group still was a large business player. In the words of
Anthony Salim:
We talked to the new, emerging government and asked them several
questions. 1. Whether a company like Salim can still exist under the
new environment; and 2. Is this going to be a political or commercial,
economic solution. If this is a political solution you can do anything
you like, nationalize companies or put someone in jail. But we believe
it is commercial solution for the following reasons: The new emerging
country for economic policy heavily depends on IMF, World Bank and
bilateral support. We believe that has not been changed. So we believe
a commercial solution is one of the solutions for the economy. Secondly,
it is not only us. Its the total financial, monetary, corporate crisis. We
are one of the problems, no doubt a big one, but one of the many. (. . .)
Our approach is: ok, we open up. We dont believe that negotiation
will be hide and seek. This is the total wealth of the group. Some of the
assets are already pledged to the bank, some is free. Even my personal
assets I declared, like my house in Los Angeles, I just declare also. This
is our wealth; now lets negotiate how this is going to solve the problem.
(Anthony Salim)
Thus, the Salim Group experienced the most severe crisis in its history.
On the other hand, the crisis was also an opportunity to get rid of old
businesses and select the most profitable companies for continuation.
The Salim Group did this through extremely skilful negotiations with
the government and the banks. As Anthony Salim was now clearly the
central leader, and the crisis had contributed to a reorientation of the
conglomerate, the group was on its way to fully implement a more
market-oriented and less relationship-focused corporate strategy. The
institutional environment was chaotic during the crisis, but it was gen-
erally expected that a more liberal economic policy and a decrease in
crony capitalism would eventually take place.
After the crisis, the leaner Salim Group sought to diversify away
from Indonesia into Asia to mitigate its dependence on Indonesia.
It established new relations abroad with business partners and with
governments. After an initial period of recovery, the Salim Group
has started an ambitious growth strategy again since 2003. It invested
heavily in China and India, both growth markets, and also in other
Asian markets, as well as in Australia. It also strengthened its existing

businesses in Indonesia, such as Indofood, with new acquisitions. But
it never again tied up closely with the new generation of politicians,
even if the business environment continued to be characterized by
crony capitalism.
Composition of the Salim Group Network
As the previous paragraphs show, the Salim Group maintained part-

nerships with a variety of actors, ranging from political figures to
foreign multinationals. Interviews suggest that the second generation
leader, Anthony Salim, wished to modernize and professionalize the
business. He also wanted to reduce the dependence on Suharto and
on Indonesia in general. Whereas his father engaged in various joint
projects with other ethnic Chinese tycoons in the region, he expressed
the vision that business reasons rather than cultural reasons should be
leading when it comes to business decisions. Aside from carrying out
a rigorous interpretative analysis, we also measured the evolution of
networks ties of the Salim Group in a quantitative way for a period of
two decades (19842003), and the results of the coding procedure are
available in Figure 1.
Quantitative network analysis shows the explosive growth the Salim
Group experienced in the years before the Asian Crisis, a period of
frantic business activity in Southeast Asia. From 199396 the num-
ber of partnerships in all categories rose. After the Asian crisis, which
fundamentally affected the Salim Group, it did not form many new
partnerships. A combination of internal and exogenous factors, such as
the size of the group, as well as economic growth or decline, appears
to offer an explanation for the size of the business network.
Figure 2 shows the relative importance of the different partnership
categories over time and displays them in the form of a linear trend.
In terms of network composition, the most striking result is that for-
eign network ties, occurring more often than crony and ethnic Chi-
nese together, show an increasing trend, something hitherto hardly
observed in the literature on ethnic Chinese business. Obviously, this
is related to the fact that the Salim Group is a large group, small- and
medium-sized firms are unlikely to have ties with foreign multination-
als on the same scale as the Salim Group. This finding should be
interpreted keeping in mind that the case is a mature and large ethnic
14
12
10
Number of occurences
8 Ethnic Chinese
Political
6 Foreign
0
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Figure 1. Salim group partnerships.
Source: Authors database.
100%
Ethnic Chinese
75% Political
Foreign
50%
Linear
(Ethnic Chinese)
25% Linear (Political)
Linear (Foreign)
0%
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
Figure 2. Relative importance of partnerships.

Source: Authors database.
Chinese business group, in recent decades in which many multina-

tionals entered Indonesia and searched for a local partner. When one
dives into the qualitative information behind these figures, it appears
that the majority of the Salim Group partners are Western or Japanese
multinationals such as Dow Chemical, Suzuki, or Heidelberg Cement
Group. After the crisis, almost all of the new partnerships occurred
with foreign partners.
Crony relations show an erratic trend in the period far before the
crisis, then just before the crisis an increase, followed by a sudden
decline. After the crisis, no new businesses were formed with politi-
cal ties in Indonesiaat least as far as such events are captured in
this database. This declining trend is certainly affected by the general
political situation after the Asian Crisis in Indonesia. The Salim Group
was closely connected to the Suharto family, and previously engaged
in various ventures with Suhartos children. During the crisis, Suharto
was forced out of office and the Salims, being the largest business
family in Indonesia, were subsequently taken as a symbol of the bad,
old, crony regime and pressure was exercised to dissolve the Group
altogether. While this did not happen, the Salim family was forced to
hand over large parts of their empire to the new government. In Indo-
nesia, as far as the author knows, the Group did not engage in business
ventures with political partners, although anecdotal (but not factual)
evidence surfaced suggesting that the Salim Group tried to establish
connections with subsequent presidents. This radical break from the
prior crony strategy may also be because the group was very much in
the spotlight when it came to political ties and suffered severe nega-
tive impact from its prior connectedness. In other countries, however,
such as China and Singapore, the Salim Group continues to do busi-
ness in partnership with government-linked firms. However, given the
large scale of the Salim Group investments, and the predominance of
government-linked firms in these countries, the political ties abroad
are not of the same nature as compared to those with the Suharto
family in Indonesia.
Compared to the amount of popular and academic literature on
ethnic networks among the Chinese minority in Southeast Asia, the
component of ethnic Chinese business ties as a percentage of the total
amount of partners is surprisingly low. Considering that the Salim
Group is mainly active in Southeast and East Asia, where a very large
proportion of big businesses are owned by people of Chinese descent,
the number of business deals with this category of partners seems par-
ticularly modest.
Ethnic Chinese partners show a slight declining trend, which may
be consistent with the vision of the second generation business leader
who attaches no special importance to descent or identity when it
comes to selecting business partners. This seems consistent with our
proposition three, which argues that bonding ties will decrease over
time as the country modernizes and the firm matures, with looser
network ties taking their place. In particular, the trend seems to be
towards arms length relationships with multinationals, rather than
the more particularistic political and ethnic ties that dominated in the
past. This trend was visible before the crisis already, but the Asian
Crisis seems to have given even more prominence to partnerships
with foreign multinationals, because both ethnic Chinese and political
ties declined. Our results should be interpreted with care, because we
measure only occurrences, not importance, but with this caveat, we do
see a slight decline of ethnic and political ties before the crisis, and an
even sharper decline thereafter.
These figures do not tell us anything about the situation before 1984.
The interpretative analysis suggests that both political and ethnic Chi-
nese ties were important, with ethnic Chinese ties being predominant
in the period before 1965, and ties with Suharto and his family were
essential in the years 196584. For example, initial internationalization
took place with the help of regional Chinese networks, and many of
the early firms were started with support of the Suharto regime. While
this early situation matches our first and then second proposition (on
the predominance of ethnic and political ties, respectively), our quan-
titative analysis shows that these propositions cease to be applicable in
the period starting in 1984.
Discussion
Single case studies are not designed to lead to conclusions that apply
to an entire population. The Salim Group was chosen for its size and
importance, and most likely this very fact influences the nature and
composition of the network ties with other firms. We take this into
account when interpreting the results. Nevertheless, good case research
can formulate new insights and unearth new patterns that may apply
to a broader group of entities. In order to achieve this, we abstract
our results into a dynamic model of network development that can be

tested in future studies (Figure 3).
Our study suggests that the Salim Group built both bonding and
bridging capital over time, and it points at the increased importance of
bridging capital through foreign and in particular Western and Japa-
nese partners. From the outset the founder, Liem Sioe Liong, built
relationships with political and military leaders (bridging his ethnic
social network), which helped him survive difficult times and cata-
pulted the group to new heights when the economy thrived during
the Suharto regime. When the group grew, new ties were created with
international banks and multinational players, further increasing the
importance of bridging capital. Bonding capital was more important
in earlier times, and my data already indicated that it decreased over
time to less than a quarter of the partnerships. Bridging capital, ini-
tially with politicians, but later with foreign business partners, became
more important over time. If we now combine these insights from the
qualitative and quantitative analyses, we can display the development
of the Salim Group network more schematically in phases of company
development in the form of a framework that can be tested in studies
of other Chinese Indonesian family firms. Each phase in the develop-
ment of the small family firm towards the large and international fam-
ily conglomerate displays a different network composition. Figure 3
displays these phases and the importance of the different network ties
over time in a testable framework.
A large group of Asia scholars, inside but also outside the field of
management, has emphasized the crucial importance of the ethnic
Clan Local Ethnic

Members Chinese Regional Ethnic
Family Partners bridging
Chinese Partners
Importance Members
of Network
Ties MNCs
International
Politicians bonding
Global Banks
Foreign
Local
Army Investors
Politicians
Officers Time
Modest Local Domestic International

MNC
Operations Growth Growth
Figure 3. Framework: Bonding and bridging capital over time.

network for Chinese migrant businesses. In the process of researching

these network ties the impression was created that ethnic networks
were the most important source of business partners. This appears
not to be supported by our case results, and our results are important
as they go against common wisdom. The reason for this discrepancy
could lie in the fact that most scholars studied first-generation firms,
and that firms in more mature stages of development simply display
different patterns than start-up ventures. This essay clearly shows that
there is an opportunity to advance our thinking on ethnic Chinese
family firms by de-emphasizing ethnic networks.
One has to note the obvious fact that the case selection has influ-
enced the results. Due to the size of the Salim Group they became
an interesting partner for large Western of Japanese multinationals.
Also, the existing and new Salim businesses became so large that they
required syndicate loans from multiple international banks, and that
equally large firms from abroad were sought to act as partners. The
Salim Group simply outgrew many of its original networks. How-
ever, surprisingly little theory has been developed to study and explain
the importance and nature of Western partners for ethnic Chinese
conglomerates. In this particular case, theories of networking focusing
solely on ethnic networks or solely on crony connections seem to be
less applicable.
I cannot claim that the patterns observed here are relevant beyond
this single case, but I would think it is not unlikely that other large
ethnic Chinese firms display a similar trend. Is the dominance of
strong ethnic network ties for large ethnic Chinese businesses a myth?
This is certainly a question worth investigating in future research pro-
grams. Instead, I postulate that business networks can better be seen
as expanding concentric circles (Fei 1992), in which families build
wider rings of networking as they grow in importance. Over time, the
networks of successful firms gradually outgrow the family, the ethnic
circle and the domestic environment. Instead of focusing on one type
of network, I advocate a dynamic approach to business networks, in
which social capital can function as an umbrella concept. Social capi-
tal can be deconstructed in different types of network ties, such as eth-
nic networking, cronyism, and ties with foreign multinationals, and I
argue that the importance of each tie differs over time, depending on
external factors (e.g., political regime) and internal factors (size of the
firm, generation of family leaders).
The results also show how the network size and composition is
related to institutional factors, such as economic growth, crisis, political
changes and institutional modernization, and how it changes substan-
tially over time, displaying both gradual and sudden changes. This
study supports the proposition informed by institutional scholars that
ethnic network ties and corrupt alliances with politicians will decrease
over time as economies modernize and become open market democ-
racies, as mentioned in the beginning of this chapter. Institutional
improvement decreases the extra benefits of a strong ethnic network.
With regard to the effects of the crisis, we see an overall decline in
new partnerships, and of those remaining new network ties virtually all
are with foreign multinationals. Political ties in particular are affected
by political changes. Contrary to proposition two, the Salim Group
did not build close connections with subsequent political leaders, even
if some other Indonesian business groups (e.g., Bakrie Group) have
continued to benefit from a politically connected strategy beyond the
Suharto period, suggesting that such a crony model continued to be
an option for business leaders. With regard to ethnic Chinese ties and
the Asian Crisis, our data suggest that the regime change strength-
ened the ongoing decline in the relative importance of ethnic Chinese
network ties. In addition, our study also points at the importance of
internal factors. The second generation leader of a family business is
more likely educated with Western management ideas, and may have
different views on building business relations than the previous genera-
tions, which are more strongly rooted in Chinese culture. Our results
also imply that the Salim Group, by virtue of foreign firms being its
most important type of partners, will likely have adapted to the way
of working of Western and Japanese firms, and thereby will have built
competencies to operate in ways similar to modern multinationals.
Perhaps the era in which ethnic Chinese business groups could be
envisioned as unique species is over.
Conclusion
In conclusion, the respective theories of intra-ethnic Chinese networks

(proposition one) and crony networks (proposition two) seem insuf-
ficient to explain the long term development of business networks of
the Salim Group, one of the largest firms in Southeast Asia. Theories
of social capital can combine different types of network partners into
a single concept, and therefore seem more appropriate in analyzing

large ethnic Chinese firms. An evolutionary approach to network ties
combining bridging and bonding capital reveals the decline of the lat-
ter and the growth of the former over time. More in particular, the
importance of ethnic Chinese ties appears to be waningsomething
that is only exacerbated by the Asian Crisis. The importance of politi-
cal ties is radically affected by the Asian Crisis, after which the Salim
Group discontinued the strategy of close cooperation with a political
leader. Throughout, the most important category of ties appears to
be those with foreign multinationals, a category that has largely been
ignored in the literature on ethnic Chinese family firms.
Reflecting back on the theoretical approaches mentioned in the
beginning of the chapter, I argue that it would be better to combine
them into a dynamic model of business network development, in which
the successful ethnic Chinese family firm progressively outgrows the
more narrow networks drawing from the family, the ethnic group,
and domestic business and political settings. Gradual changes occur in
composition of the network, and regime changes cause more sudden
network changes, in particular in terms of political ties. Framed in
such a dynamic model, the theories we investigated all have a place,
but their importance varies over time. More empirical work is neces-
sary to establish whether the Salim Group is a special case, or whether
the decline of ethnic and political ties, and the rise of foreign network
ties are typical features of large ethnic Chinese conglomerates. I have
developed an evolutionary method of analyzing embeddedness in net-
works, encompassing both bonding and bridging capital over time,
and revealing both gradual and sudden trends. I argue that this type
of network analysis leads to a more accurate understanding of ethnic
Chinese business networks.
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INDEX
Accommodation 12, 66, 75, 87 Born Again 23, 3132, 3435, 39

Adinegoro, Jamaluddin 94 Boven Digoel 103
Agency 4, 8, 1213, 17, 52, 54, 67, 102 Brand management 12
Anderson, Benedict 93, 94 n. 2 Bridging capital 205, 219, 222
Ang Hoay Lie 99 Budi Utomo 122
anti-Chinese violence 3, 23, 77, 81, Business
86, 169 networks 1011, 17, 81, 179,
Arabs 117 n. 1, 118, 133 201207, 215, 22022
Asian Crisis 14, 202, 21213, 215, problems 32, 3839, 42
21718, 22122 success 67, 10, 204
Assimilation
policy 1112, 16, 2930, 48, 50, 56, Catholic community 83
5960, 6465 Chadbourne Scheme 151
process 69 Charismatic
program 58, 74 Christianity 14, 27, 42
versus integration framework 50 movement 26, 3637, 39, 41, 43
Assimilationist Chen Kung Po 17678
cosmopolitan 7678, 84, 87 China 3, 67, 9, 13, 26, 35, 4849, 76
natural 7273, 78, 84, 87 n. 15, 82, 100101, 111, 113, 122,
opportunistic 7475, 82, 84, 87 12425, 132, 13437, 151, 170, 172,
symbolic 75, 78, 81, 8384, 87 17680, 192, 197, 203, 208, 211,
Association of Journalists of Asia 21314, 217
( Journalistenbond Azie) 104 Chinese
associations 67, 78, 82, 8485, 135,
Bahasa Indonesia 110 189
Bahasa Melajoe Tionghoa 110 business community 149, 158, 173
BAKOM PKB 47, 48 n. 2, 50, 5557, business conglomerates 6
6061, 63, 66 n. 3 capitalism 7, 203
Bakrie Group 221 Council 13031, 134
Balai Poestaka 96, 10102, 104 government 13, 124, 173
Bandung 63, 102, 107, 151, 153, 172 funeral society 75
Bangkok 172, 193, 195 Indonesian 34, 916, 23, 2528,
Bank Central Asia (BCA) 212 33, 39, 41 n. 12, 4243, 4751, 53,
Batavia 10406, 11112, 117, 12526, 5564, 66, 219
127 n. 14, 12932, 13435, 146, 151, journalists 1415, 94, 105, 107,
157, 159, 178, 186, 189 n. 28, 190 109
Bataviaasch Nieuwsblad 130 movement 123
Be Hien Nio 172, 176 nationalism 13, 125
Be Kwat Koen 172, 178 network capitalism 6
Beelaerts van Blokland, F. 133 New Year 30, 48, 75, 77
Berkeley mafia 210 organizations 13, 29, 67, 69, 78,
Bintang Hindia 104 8687
Bintarti, R.M. 99, 105 overseas 7 n. 2
Boen Joe On 104 problem 5, 52, 65, 77
Bonding capital 205, 219, 222 religion 69
Booth, Anne 146 shopkeeper 117, 126
228 index
Chinese Family Business (CFB) xi, colonial regime 4, 12

16970, 201203, 206 colonialism 114
Chineseness 16, 26, 2829, 43, 65, Dutch-Chinese schools 112, 125
67, 72, 74, 8687 Dwi-fungsi 54
Christianity 14, 2325, 27, 3132, 34,
3843, 8081, 228 economic
Chung Hwa Hui (CHH) 173, 177 crisis 12, 23, 29, 32, 34, 38, 40, 42,
Chuo Sangiin (Central Advisory 142, 143 n. 2, 144, 157, 165, 213
Board) 190 depression 14243
Citizenship letter 61 protectionism 143
Codification-committee 119 Eerste Bandoengsche Electrische Koffiebranderij
Colonial government 97, 10203, 117, Margo-Redjo 153
142, 177 Election 23, 25
Colonial trading system 142 Electronic printing machines 9596
Commercial journalism 95 Entrepreneurs 80, 152
Commodity prices 14345 Epiphanies 33
Communist movement, uprising 101, Ethical policy 9495
103, 113 Ethnic
Confucianism 2627, 80, 123, 203 affinity 6, 84
Confucius 123 Chinese vi, ix, 67, 911, 17, 23
Constitution of the Netherlands East n. 1, 24, 26, 27 n. 4, 28 n. 7, 29,
Indies 118 38, 39, 42, 47, 67, 86, 16970,
Conversion stories 26, 27, 32, 39 17677, 179, 18485, 20108, 211,
Copra 145, 150, 182 213, 215, 21718, 22022, 227
Corruption 36, 38, 204, 21213 Chinese firms 169, 185, 20203,
Criminal law 119 206, 220, 222
Crisis 4, 8, 10, 12, 16, 3537, 42, identity 7, 13, 42
14243, 145, 15152, 155 n. 15, networks 179, 201, 203, 205, 220
21214, 21718, 221, 227 stereotypes 70
Crisis of trust 3031 Eurasians 9495
Crisisinvoerordonnantie (Crisis Import Exclusivity 7, 65, 69, 71
Ordinance) xi, 149 Export 114, 14445, 180, 182
Crony
capitalism 20405, 212215 Foreign Orientals 16, 28, 117 n. 1,
connections 201, 204, 220 133, 13536
networks 201, 221 Fromberg, P.H. 123
relations 204, 217
Cultural nationalism 123 Galbraith, John Kenneth 165
Culture of citation 14, 99100, General Provisions of Legislation for the
10304, 114 Netherlands East Indies 118
Geo. Wehry & Co. 16063, 165
De Locomotief 117, 130, 173 Gerakan Rakyat Indonesia
De Marees van Swinderen, R. 131 (Gerindo) 114
De Waal Malefijt, J.H. 132, 136 Global community 41, 43
DEPDAGRI 5060, 6264 gold standard 146
Diaspora 6 Government Regulations
Discrimination regulations 29, 123 (Regeeringsreglement) 118
djaksa xi, 129 Governor-General 121, 12527, 129,
Doenia pers 9, 94 132, 13435
Dow Chemical 217 Guanxi 203205
Dual legal system 118
Dutch Harahap, Parada 94, 9899, 104105,
citizenship law 132 107
colonial administration 97, 143 Hart-Ishizawa agreement 150
index 229
Hatta, Mohammad 190, 191 n. 33, Java 12, 35, 81, 97100, 103, 109
192, 194 n. 21, 133, 146, 15153, 15557,
Heidelberg Cement Group 217 165, 17273, 17680, 18490, 193,
High Court 120 197
Ho, Lucy 186, 195 Journalism 95, 107, 114, 229
Hoakiauw dan Tiongkok 100 Journalist 1415, 67, 73, 9395,
Hong Kong 83, 173, 176, 179, 193, 9895, 100109, 111, 113114
195, 211
Kabar Perniagaan 124, 130, 158 n. 17
Idenburg, A.W.F. 13136 Kalimantan 61, 99, 105
Identity 34, 67, 10, 13, 1516, 27 Kan Hok Hoei (H.H. Kan) 112, 178
n. 4, 28, 3738, 51, 4043, 60, 63, Keng Po 101, 104
6566, 72, 7475, 77, 8081, 218 Khoe Boen Sioe 104
Import 142, 144, 146, 14952, 174, Kian Gwan 170 n. 1, 17275, 177,
177 n. 8, 182, 187, 193, 210 17980, 182, 18687, 189, 193, 196
India 151, 214 Kong Hoa Po 106
Indies Chinese community 93 Krebet 175, 187, 193
Indies government 96, 111, 117, Kudus 209
12225, 131, 134 Kuomintang (KMT) 113
Indonesia 36, 814, 2329, 3133, Kwee Hing Tjiat 106108
3537, 42, 47, 49, 5253, 6566, Kwee Kek Beng 9394, 104, 107
70, 72, 74, 77, 8182, 8586, 93, Kwee Thiam Tjing 111
107108, 109 n. 21, 1011, 113, 115, Kwee Zwan Lwan 18990
16971, 174 n. 5, 181 n. 16, 18485, Kwik Hoo Tong Trading Co. 177
190, 19297, 202, 204, 20715, 217
Indonesian Landrechter 117, 136
Bethel Church 32 Law on Dutch Citizenship (Wet op het
Revolution 4 Nederlandsch Onderdaanschap) 122
Internatio 152, 156, 160, 174, 194 Lee Rubber Company 174
International Colonial Exhibition 141 Lie Hoo Soen 17374
International trade 10, 142, 151, 210 Liem Kha Tong 15960
Interrater reliability 208 Liem Koen Hian 94, 104107,
Investigating Committee for the Peoples 110111, 113114
Economy 191 Liem Sioe Liong 209, 219
Investigation Body for the Preparation Life-cum-business stories 2627, 32, 41
of Independence 192 Ling Ying Ching 104
IPO 9698, 101 Loa Joe Djin 11718, 121, 12526,
131, 134
Jakarta 26, 29, 37, 47, 56, 63, 73, Lou Tseng Tsiang 125, 131, 132 n. 26
186, 188 n. 27, 191 n. 33, 19496, LPKB 47, 48 n. 2, 5051, 5354,
210 5657, 60, 63
Japans economic expansion 149
Japanese Maandblad Reclame & Efficiency
business 14243, 14849, 15758, Dagang 159
170, 17980, 208 Makasar 99, 156, 179, 182
military 45, 9, 16970, 184, 188 Malay
n. 27, 19091, 19394 magazines 9798
multinationals 217, 220 periodicals 9698
occupation 9, 171 n. 2, 173, 184, print market 9596, 99
187, 190, 191 n. 33, 192, 209 Mangkunegoro VII 17879, 185
threat 148 Margo-Redjo 12, 14243, 15253,
trade 148, 163 15556, 159, 16365
Japanese-Chinese economic Masalah Cina 5, 5253, 55, 58, 6162
networks 149 Matahari 180
230 index
May Oei Tjong Ie ( Jack) 170 n. 1, 176 n. 6,

1998 34, 23, 25, 2930, 43 185, 187 nn. 24, 26, 190 n. 30, 193, 34
riots 4041 Oei Tjong Swan 170 n. 1, 172
Media industry 14, 95 Oei Tjong Tjay (Benny) 170 n. 1, 171
Minister of Colonies 125, 13134, 136 n. 2, 174 n. 5, 181 n. 15, 186 n. 23,
Minister of Foreign Affairs 125, 195
13031 Oetoesan Hindia 96
Ministry of Home Affairs 11, 28 n. 8, Oil 131, 145
48 n. 2, 4950, 53 Ong Mie Hoa Nio 172
Mohammedans 117 n. 1, 118 Orde Baru 3
Muslim Chinese 8182, 85 Outer Islands 9798, 187
Overseas Chinese 4, 78, 1516, 72
N.V. Handelsdrukkerij Sin Jit Po 99 n. 11, 94, 100, 122
Nanking 124, 130, 181, 186, 190 Overzicht van de Inlandsche en Maleisch-
Nater, E.F.J. 15758 Chineesche Pers (IPO) 9698, 101
National Salvation Movement 180,
181 n. 17 Pacific War 152
National unity 47, 52, 5556, 65 Palembang 174, 182, 185, 193
Nationalist movement 14, 9394, 96, Pane, Sanusi 106108
101, 11314 Partai Bangsa Indonesia (PBI) 105
Nationalists 95, 105106, 115, 192 Partai Komunis Indonesia (PKI) 48 n. 2,
Nation-state 56, 16, 23, 169, 197 51, 96, 113
Natives (Inlanders) 118 Partai Tionghoa Indonesia (PTI) 106
Nederburgh, I.A. 132, 13435 Pasar Senn 126
Nederlandsch-Indische Handelsbank pass
(NIHB) 181 and zoning system (passen- en
Neratja 96 wijkenstelsel ) 78, 123
Netherlands East Indies 9, 13, 11725, Pentecostal-charismatic
130, 13237, 17071, 178, 184, 186 Christianity 2325, 3132, 3843
Netherlands Indies 110, 125, 134, Peranakan 14, 27 n. 5, 28 n. 5, 67,
14144, 14748, 150, 152, 156, 158, 7273, 76 n. 16, 77, 80, 83, 9395,
160, 163 106 n. 17, 10714, 123, 171 n. 2,
New Order 3, 11, 16, 25, 27 n. 4, 172173, 176177, 18485, 192
2830, 42, 4952, 6566, 69, 7576, Perniagaan 104
77 n. 17, 80, 83, 8586 Persdelict 99103
New York 143, 17475, 193, 197 Pewarta Soerabaja 99
Newspaper Phoa Liong Gie 106107
market 95, 98 Phoa, Th. H. 94, 99100, 102
Njoo Khee Tjo 99 Police-court ( politierechtspraak,
Nomura East Indies 174 politierol) 119
Non-pribumi 30, 58 Political connection 204, 208
Political Intelligence Service
Oei Kie Hok 99, 107 (PID) 102103
Oei Ping Bie 99 Post-Suharto Indonesia 3, 229
Oei Siem Nio 102 Press
Oei Tiong Ham 9, 106, 112, 170 n. 1, industry 96
171 n. 2, 17274, 17980, 182 n. 20, Pribumi 30, 36, 48, 5758, 62, 82
195, 209 n. 23, 19092
Oei Tiong Ham Concern (OTHC) 9, Print market 9596, 99
106, 112, 17073, 174 n. 5, 178, Printing industry 96
18081, 182 n. 20, 18485, 187, 189, Production 94, 14448, 150, 15253,
19498, 209 55, 174, 176, 18788, 193, 197
Oei Tjong Hauw 17074, 17680, Protestants 26, 36, 8283
182, 18487, 18995, 197 PT Radjawali Indonesia 97
index 231
Raja Gula (Sugar King) 174 Soerapati 102

Redjo Agoeng 187, 193 SOSPOL 5455, 5761, 6364
Regime change Soviet Union 151
external 9, 12, 17, 87, 202, 205, Subarjo, Ahmad 106, 180
220 Sugar 14346, 15051, 17172,
internal 910, 12, 87, 22021 17475, 177 n. 8, 179, 18288,
within 9, 1213, 87 19394
Regulations for the Judicial Suharto 34, 6, 1012, 14, 16, 23,
Organization (Reglement voor de 28, 29 n. 11, 30, 32, 38, 41, 4750,
Rechterlijke Organisatie) 120 5256, 5864, 6869, 83 n. 24, 204,
Religious conversion 23, 75 20910, 21215, 21719, 221, 229
Residency-court 119 Sukarno 4, 10, 47, 49, 52, 169, 171,
Re-sinicization 49 19091, 197, 209
retail traders 153, 15657, 60 Sulawesi 58 n. 24, 99
Rubber 14347, 150, 17475, 179, Sun Yat-sen 113
182, 185, 193, 197 Surabaya 96, 99100, 105108,
110111, 113, 163, 174 n. 5, 180,
Salim Group 10, 202, 207208, 183, 18687, 188 n. 27, 194, 227
21015, 21722 survival strategy 14243, 152, 209
Salim, Anthony 21115 Suryadinata, Leo 5, 7 n. 2, 24, 29, 47
SARA politics 54, 62 n. 1, 6970, 80, 105 n. 16, 106 n. 17,
Sarekat Islam 96 108, 11011, 114, 12324, 192, 204
Sarpoci (Sarikat Pegawai Oei Tiong Ham Sutomo, Dr. 105, 107108
Concern Indonesia) 183 Suzuki 217
Semarang 96, 105108, 111113, 142, Syarifuddin, Amir 106107, 114
15253, 156, 163 n. 27, 170
n. 1, 173, 17780, 183, 185, 189, Tabrani 94, 104
192, 194, 197, 209 Tan Liang Ho 155, 165
Shanghai 173, 176, 17879, 183, 189 Tan Ling Djie 106
n. 28, 193, 197 Tan Swan Bing 171 n. 2, 172 n. 4,
Siang Hwee 124 180 nn. 12, 14, 181 nn. 15, 17, 182,
Siang Po 106 185, 187 n. 26, 188 n. 27
Sin Jit Po 94 n. 3, 96 n. 4, 99107, Tan Tek Peng 171 n. 2, 17276, 181
113 n. 23, 114 n. 16, 18283, 18586, 187 n. 26,
Sin Po 94, 104105, 107, 10913, 18893, 195
124 Tan Tiong Ie 15355, 164
Sinar Hindia 96 Tan Tjiang Lin 112
Sinar Sumatra 1056 terms of trade 144, 14647
Sindhunata 4748, 49 n. 5, 5053, 54 The Hague 119 n. 6, 125, 13032,
n. 15, 5657, 60, 6364 135, 189 n. 29, 190 n. 31
Singapore 124, 156, 17172, 17475, The Kian Seng 105, 107, 123, 131,
17980, 18384, 187 n. 24, 193, 132 n. 26, 177
19597, 211, 213, 217, 227 The Netherlands 9, 13, 9596, 99,
Singkeh 110, 173, 177, 184 101, 110, 112, 11725, 130, 131
Sino-Malay language 99 n. 24, 13237, 14144, 146 n. 4,
Sino-Malay newspapers 124 14748, 150, 152, 15556, 158, 160,
Snouck Hurgronje, C. 133 163, 164 n. 27, 170173, 178, 180
Social capital 6, 205206, 22021 n. 13, 184, 186, 19697, 22729
Social networks 114, 203 THHK schools 112, 12324
Soe Po Sia 113, 124 Tiong Hoa Hwee Koan (THHK,
Soeara Poeblik 105 Chinese Association) 112, 123
Soepratman, W.R. 104 Tionghoa 48, 81, 100, 106, 110, 155,
Soerabaiasch Handelsblad 131 n. 22 16061
232 index
Tjoa Sik Ien 106 Wall Street 143

Tjoa Soe Tjong 173, 176, 178 Wang Ching Wei 176, 186
Tobacco 145 Wardi, Mr. 102
Totok 27 n. 5, 28 n. 5, 6768, 72, 74, Western education 95
85, 10910, 112 Williams, Lea 116, 138
Toyoshima Ataru 189 Wongsosewojo, Achmad 104105
Trading enterprises 142
Yamin, Muh. 106, 114
United States 8, 151, 174 Yap Tjwan Bing 192
Urban middle class 98 Yogyakarta Chinese 6667, 72,
7678, 84, 87
Van der Meer 127 n. 14, 128, 129 n. 17 Yokohama Speciebank (YSB) 181
Van Heutsz, J.B. 132, 134
Van Mook-Kotani agreement 150 Zaibatsu 179, 187

(Chinese Overseas - History, Literature, and Society) Marleen Dieleman, Juliette Koning, Peter Post-Chinese Indonesians and Regime Change-Brill Academic Pub (2010)

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Chinese Indonesians and Regime Change

History, Literature, and Society

Courtesy Mrs. Lieke Oei Tiang Han.

This book is printed on acid-free paper.

Library of Congress Cataloging-in-Publication Data

Copyright 2011 by Koninklijke Brill NV, Leiden, The Netherlands.

All rights reserved. No part of this publication may be reproduced, translated,

Authorization to photocopy items for internal or personal use is granted by

Acknowledgements ..................................................................... vii

Chapter One Chinese Indonesians and Regime Change:

POLICY AND DIGNITY:

Chapter Two Business, Belief, and Belonging: Small Business

Chapter Three Assimilation, Differentiation, and

Chapter Four Diversity in Compliance: Yogyakarta Chinese

JUSTICE AND REPRESENTATION:

Chapter Five The Chinese Connection: Rewriting Journalism

SURVIVAL AND CREATIVITY:

Chapter Seven Crisis Management and Creative Adjustment:

Chapter Eight The Oei Tiong Ham Concern and the

Chapter Nine Continuous and Discontinuous Change in

Index ........................................................................................... 227

This volume emerged out of a series of monthly seminars held at the

ABRI Angkatan Bersenjata Republik Indonesia Armed Forces

KOPKAMTIB Komando Pemulihan Keamanan dan Ketertibaan Opera-

Ahli Asimilasi assimilation expert

Nobuhiro Aizawa is researcher in the Institute of Developing Econ-

Alexander Claver is senior political and strategic analyst at the Dutch

Marleen Dieleman is visiting fellow at NUS Business School in Singa-

Juliette Koning is senior lecturer in organisational anthropology at the

Peter Post is senior-researcher at the Netherlands Institute for War

Andreas A. Susanto is head of the Department of Sociology at the

Patricia Tjiook-Liem acquired her Master of Law at the University of

Nobuto Yamamoto is professor of Southeast Asian Politics in the

CHINESE INDONESIANS AND REGIME CHANGE:

Marleen Dieleman, Juliette Koning, and Peter Post

When President Suharto stepped down in May 1998, a fundamental

Chinese Indonesians: State-Centered and Diaspora Perspectives

Chinese Indonesian studies have generally been dominated by two

In the state-centered narratives the Chinese are typically presented

communities, and how did it affect relations between different groups

solidarity, embodied in ties with their ancestral land, or qiaoxiang (Douw

inter-ethnic affiliations, but have never really been able to overshadow

The Power of Regime Change

The concept regime change became an important analytical tool

regime change as a concept is widely used and debated. Although a

businesses progressively outgrow narrower forms of networking and

so, he takes a position against the portrayal of Chinese Indonesians as

In the legal realm, Indonesian history also offers examples of changes

from colonial rule to independence. Yamamotos chapter argues that

Chinese Indonesians and Regime Change: An Alternative Perspective

Our alternative perspective hence centers on two central features.

The chapters in this book are therefore clustered in a thematic rather

test the resilience of businessmen as adverse conditions threaten the

POLICY AND DIGNITY:

BUSINESS, BELIEF, AND BELONGING:

This chapter discusses religious conversion among Chinese Indone-

After Islam (eighty-eight percent), Christianity constitutes the second

negative image is supported by often repeated but rarely substanti-

Researching Business and Belief

The data collection took place in the city of Yogyakarta, central

when expressions of Chineseness were starting to be brought more into

as are the majority of the members. Reacting to the question why

The conversion stories of the Chinese Indonesians in this study only