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Indonesia: Governments
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Administratively, Indonesia consists of 33 provinces, five of which have special status. Each province has its own political legislature and governor. The provinces are subdivided into regencies (kabupaten) and (kota), which are further subdivided into subdistricts (kecamatan), and again into village groupings (either desa or kelurahan). Following the implementation of regional autonomy measures in 2001, the regencies and cities have become the key administrative units, responsible for providing most government services. The village administration level is the most influential on a citizen's daily life, and handles matters of a village or neighborhood through an elected lurah or kepala desa (village chief).
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Indonesia faces enormous and diverse challenges — consolidating democracy, addressing regional conflicts, and regenerating the economy. Indonesia declared independence on 17 August 1945 after a long fight against Dutch and British colonialism, and Japanese imperialism. Since then, Indonesia has already experienced several forms of government. Today, Indonesia is seen as having made significant progress in advancing its democratic institutions and practices in a relatively short time. It is slowly rebuilding its economic and political strength.
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During the thirty years of president Suharto's "New Order" government, Indonesia's economy grew from a per capita GDP of $70 to more than $1,000 by 1996. Through prudent monetary and fiscal policies, inflation was held in the 5%–10% range, the rupiah was stable and predictable, and the government avoided domestic financing of budget deficits. Much of the development budget was financed by concessional foreign aid.
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Indonesia's development outlook is mixed. Macroeconomic indicators are, on the whole, favourable and stable. The Indonesian Government's decision not to seek further International Monetary Fund exceptional financing from the end of 2003 was well accepted by financial markets and international donors. The legislative elections of 5 April 2004, an unprecedented logistical task, were conducted freely, fairly and peacefully.
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The acquisition is subject to approval by the Indonesian government authorities, including BPMigas, Indonesia's oil and gas regulatory authority. During the first three-year exploration phase of the PSC beginning January 2007, Harvest and Tately expect to acquire, process and interpret approximately 500 kilometers of 2D seismic and drill two exploration wells. The expected cost of this program is $22 million of which Harvest will fund the first $17.2 million plus it's pro rata share of subsequent costs. Tately will operate through the exploration phase of the PSC. Harvest has the option to assume operatorship upon approval of a plan of development for any commercial discovery, subject to BPMigas approval.
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During Suharto's regime, his family held sway over much of Indonesia's economic life, and government corruption increased. While the economic conditions of many Indonesians improved, opposition to his policies continued to be suppressed. In Oct., 1997, the country was plunged into economic upheaval when its currency plummeted. The stock market followed soon after, and the International Monetary Fund (IMF) agreed to provide the country with a $40 billion aid package in exchange for economic reforms. Struggling under a huge foreign debt and Suharto's reluctance to implement the IMF reforms, Indonesia's economy continued to worsen in 1998. Student protests and riots over rising prices broke out across the country, with increasing demands for Suharto to resign.
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