figfting corruption in indonesia
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UNIVERSITI SAINS MALAYSIA
SCHOOL OF SOCIAL SCIENCES
MASTER OF PUBLIC ADMINISTRATION
SPA501 : PUBLIC ADMINISTRATION AND THE POLITICAL SYSTEM
Professor Lim Hong Hai
FIGHTING CORRUPTION IN INDONESIA,
IS SUSILO BAMBANG YUDHOYONO ABLE TO?
By :SARJANUDDIN (P-SM0123/09)
MUHAMAD IZZWANDI BIN MAMAT (P-SM0081/09)
INTRODUCTION
On July 8, 2009, voters on the more than 17,000 islands of Indonesia
went to the polls to elect the country's President. As suggested, Susilo Bambang
Yudhoyono, the incumbent candidate, notched up a resounding victory. Since
winning the country's first competitive election in 2004, the former general has
been a cool steward of Indonesia's young and often chaotic democracy, denting
the country's grim legacy of corruption, cracking down on radical Islamist groups
and rebuilding a nation that suffered the brunt of 2005's devastating Indian Ocean
tsunami. SBY — Yudhoyono is widely referred to by his initials — is seen as a
moderate and honest figure in a nation still emerging from decades of cronyism
under the deceased military dictator Suharto. When his triumph is certified, he
will become the first President to be re-elected in what is the world's most
populous Muslim democracy.
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As Susilo Bambang Yudhoyono re-elected for next 5 years as the
president of Indonesia has breathed Indonesia life into new expectation in fighting
corruption. Susilo Bambang Yudhoyono has acted in good steps to bringing back
country’s confident in facing negative publicity about world’s corruption level
either from inside country media or international media.
Indonesia ranks in the bottom of the corruption perception index in
Asia, and it is believed that graft as the main problem in the country. President
Susilo Bambang Yudhoyono, owes much of his popularity to his clean image and
record of fighting corruption. But much remains to be accomplished before
Indonesia can say it has beaten corruption.
Corruption in Indonesia was a serious problem since the Dutch
colonial period as the salaries of the Dutch Company's personnel were not
adequate enough. Corruption became endemic during President Soekarno's rule
because his “disastrously inflationary budgets eroded civil service salaries to the
point where people simply could not live on them and where financial
accountability virtually collapsed because of administrative deterioration"
(Mackie 1987: 87- 88).
Corruption in Indonesia has become usual behavior in every single
civil servant activity. For example, we can find that no more than 50 metres away
from the Central Jakarta Palace of Indonesia's President, policemen are pulling
over cars seen to be violating the city's rather compromised law known as the
three in one. That traffic minimisation law holds that during peak hours, cars on
selected major roads must always be carrying three people. The trouble is that the
rule has also spawned an entire sub-industry, ridden by people called jockeys, the
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name given to the individuals with their thumbs out at intersections, prepared to
jump into your car for a small fee. That aside, the car we see the police pulling
over down the street has only two people in it. A conversation is had through the
window and something is passed between a policeman and the driver, who we
then pull over for a chat.
The United Nations Development Programme (UNDP) has defined
corruption as "the misuse of public power, office or authority for private benefit
through bribery, extortion, influence peddling, nepotism, fraud, speed money or
embezzlement" (United Nations Development Programme 1999: 7). Perceptions
Index (CPI) in 2003, Indonesia ranked 122nd is perceived to be the second most
corrupt after Myanmar, which is ranked 129th among the 133 countries surveyed.
In this essay, we focuses on what was Susilo Bambang Yudhoyono
did in his first 5 years reigning Indonesia and what will he do for next second 5
years in fighting corruption.
CAUSES OF CORRUPTION
According to Quah, 1999; Corruption is a serious problem in
Indonesia (and other countries), the extend of corruption in Indonesia depends on
two factors: (1) the nature of the causes of corruption; and (2) the degree of
effectiveness of measure initiated by political leaders to combat corruption. In
order to curb corruption in Indonesia (and other countries), the causes of
corruption must first be correctly diagnosed so that political leaders can take
appropriate action to minimize, if not eliminate, such causes.
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The nature of mostly Indonesian made the corruption grew fast in
proportion to economic growth. Most of Indonesian had heart set on saying thank
you with money or things. In the past, it was a good habit, but later it became bad
and worst. Thank you in money or things, in the past, gave after someone got
what he/she need achieved. Over the time, it was changed slowly; the money or
things gave before the desire is achieved, and hoping that what desired come true.
This also happens in government activity, especially in project management.
Where certain parties to give thanks at the beginning of the project in hopes the
project will be his.
In Palmier’s comparative study of the control of bureaucratic
corruption in Indonesia, he has identified three factors as important causes of
corruption: opportunities (which depended on the extent of involvement of civil
servants in the administration or control of lucrative activities), salaries and
policing (the probability of detection and punishment).
- Low Salaries
Palmier has identified low salaries as an important cause of
corruption. "If the official is not to be tempted into corruption and disaffection,
clearly there is an obligation on the government to provide or at least allow such
benefits as will ensure his loyalty; one might call it an implicit contract" (Palmier
1985: 2). Thus, "adequate pay" becomes "an essential ingredient in reform"
(Palmier 1985:6).
If bureaucrats are paid a high enough wage, even a small chance of
losing their jobs would discourage them from being corrupt." Conversely, if the
real salary of civil servants decreases drastically, "even the most rigidly honest
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bureaucrats will be tempted to go beyond the law to preserve their standard of
living" (Banerjee 1996: 110).
- Opportunities for Corruption
The expanding role of the public bureaucracy in national development
has increased the opportunities for administrative discretion and corruption as
"regulations governing access to goods and services can be exploited by civil
servants in extracting 'rents' from groups varying for access to such goods and
services" (Gould & Amaro-Reyes, 1983: 17).
In Indonesia, Warwick has introduced the interesting distinction made
by civil servants between "wet" and "dry" agencies, depending on their budgets
and access to the public. According to Warwick (1987: 43): "wet" agencies . . . are
generous with honoraria, allowances, service on committees, boards, and
development projects, and, recently, opportunities for foreign training. They are
departments that deal in money, planning, banking, or public enterprises. "Dry"
agencies are those doing traditional administrative work. Perceptions of unfairness
about benefits not only reduce staff morale, but lead to the feeling that illegal
compensation is a fair way to even out staff benefits across agencies.
Thus, "wet" agencies like the customs, immigration, internal revenue,
and police will provide more opportunities for corruption than "dry" agencies like
research and administrative departments, which do not interact directly with the
public. According to Prawiro (1998: 230-231,264), Coordinating Economics
Minister in Indonesia from 1989-1993, the tax office and the customs service
were the most lucrative of the "wet" government agencies in Indonesia. Indeed, as
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"dry" agencies have reduced opportunities for corruption, "being posted to a dry
position is about the worst fate any official could fear" (Loveard 1999: 111).
- Low Risk of Detection and Punishment
As corruption is an illegal activity in all countries, those individuals
found guilty of corrupt offences should be punished accordingly. However, in
reality, the probability of detection and punishment of corrupt offences is low in
Indonesia, the Philippines and Thailand as the public in these countries perceive
corruption to be a low risk, high reward activity.
The Indonesian Civil Service's weak disciplinary control is reflected
in the difficulty in detecting corrupt behaviour among its members and the
absence or light penalty for such behaviour. In his 1969 survey of regional
economic planners in Indonesia, Smith (1971: 30) found that apart from the lack
of incentives for correct behaviour, sanctions were also absent or rarely applied to
those officials who were under-performing as "cultural norms effectively preclude
punitive denial of the perquisites, however minor, that attend each position."
Smith (1971: 30) concluded that "the common procedure for dealing with officials
whose corrupt practices became open knowledge is to transfer them to new jobs
before their activities gain wide attention."
Similarly, when a senior Indonesian civil servant was advised to
dismiss his indolent and corrupt subordinates, he replied that he could not do so
because they "had large families to support and needed these jobs. Besides, they
didn't earn enough anyhow" (Palmier 1985: 210). Finally, Palmier (1985: 280)
found that corruption was rampant in Indonesia because it was tolerated as corrupt
officials were seldom punished.
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The three major causes of corruption in Indonesia, are the low salaries
of civil servants and political leaders, the many opportunities for corruption in
"wet" or vulnerable agencies, and the ineffective policing or low probability of the
detection of and punishment for corrupt offences.
FIGHTING CORRUPTION IN INDONESIA
According to the World Bank’s Combating Corruption in Indonesia, “The
political transition has led to greater competition among political parties, forcing
them to depend on the old elite for the considerable funds needed to mount
effective campaigns in such a vast country. And decentralization has opened new
avenues for corruption by the local elite, who may earlier have had difficulty
getting “their fair share of the cake” in a tightly centralized Indonesia.”
Eradication of corruption itself takes a long time because it was his own
corruption has taken hold so strongly in everyday life even in the era of the
nation's 50 existing corruption.The fight against corruption in Indonesia began
after the 1955 election as corruption was rife especially in the area of import
licenses.
In December 1967, President Suharto established the Team Pemberantasan
Korupsi (Corruption Eradication Team or CET) within the Attorney General's
Office to deal with corruption cases. However, the CET was ineffective because
its efforts were blocked by influential men in the regime.(Quah, 1982:170)
The anti-corruption efforts of the Habibie administration exposed the
problem of Korupsi, Kolusi dan Nepotisme (KKN or corruption, collusion and
nepotism) but were also ineffective because there was no serious attempt to "bring
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offenders to justice" during Habibie's presidency as KKN was viewed as a
legislative problem to be resolved by introducing new laws and, the various
institutions created by President Habibie to eradicate KKN "failed to perform, and
no significant progress was made" (Assegaf et al 2002: 149).
President Abdurrahman Wahid's administration inherited "a substandard
legal system" and "a murky taxation system" which provided ample opportunities
for corruption (Smith 2001: 11). President Wahid also inherited the new anti-
corruption laws and the Joint Team for the Eradication of Corruption (TGPTPK)
was formed in June 2000. TGPTPK team was ineffective because of the poor
work commitment of its members, the lack of financing which resulted in the non-
payment of its members' salaries for several months, and its lack of authority to
investigate corruption cases which occurred before 1999 (Assegaf et al 2002:
169).
When Megawati Sukarnoputri became president in July 2001, she
inherited "a severely weakened presidency" and the unresolved problem of KKN
(Sen 2002: 17). she promised that her anti-corruption campaign would begin with
her family and that corruption must be eliminated to strengthen Indonesia's
democratisation. She also directed her cabinetministers and senior civil servants to
declare their assets to the state auditors. Furthermore, she indicated that her
ministers would be held responsible if they were found to have given unlawful
benefits to her relatives. She added: "If later it is found that any of the children
have benefited from any project, or anything else, it will be the minister who will
bear the blame" (BBC News 2001: 1-2). Megawati's remarks must be understood
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in the context of the rampant and blatant corruption perpetuated by former
President Suharto and his family during the 32 years of his rule.
THE SBY’S ANTICORRUPTION CAMPAIGN
In September 2004, Susilo Bambang Yudhoyono (SBY) was elected
President of Indonesia and his vice president is Jusuf Kalla (JK). In large part
because of his promises to improve governance and fight corruption and President
Yudhoyono has been outspoken about the need to reduce corruption, and his
government has taken a number of steps in support of this goal.
Two years into the President’s term, it is an appropriate time to examine
what his government has done to fight corruption and to what effect. Recognizing
that reducing corruption is a difficult, long-term endeavor, this report offers a
stocktaking of the variety of anti- corruption initiatives begun or enhanced since
2004. A central concern of this report is whether these initiatives can produce a
significant and lasting decline in the level of corruption in Indonesia.
According to Transparency International’s 2005 Global Corruption
Barometer, 81% of Indonesians surveyed think corruption will decrease “a lot” or
“a little” over the next 3 years. Only 10% surveyed think it will get worse. This
level of optimism was the highest of all the countries surveyed.
The Yudhoyono government’s agenda for its first 100 days was as broad
as it was bold. It proclaimed: “To create an Indonesia that is just and democratic,
the main agenda is to improve the performance and to restore public faith toward
law enforcement agencies, especially the AGO and Police, also the functioning of
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judicial system that is credible and accountable, and the implementation of civil
service reform based on good governance principle.”
Eradication of corruption is a big government agenda Yudhoyono-Kalla.
Of course, levels of achievement and success is very dependent on the quality of
the performance of law enforcement officers, one of the Corruption Eradication
Commission.
SBY enhance the role of the Corruption Eradication Commission (KPK) in
combating corruption in Indonesia. Performance of the executive or the
government of SBY-JK 2004-2009 in combating corruption is still not optimally.
Rather, it is found that the policy even undermine efforts to eradicate corruption.
KPK's mission is to create Indonesia becomes a country is free from
corruption. That means all the problems related to corruption, collusion and
nepotism must be completed. Commission have to drive change, so that this
nation become a nation of corruption. The presence of the Corruption Eradication
Commission (KPK) really felt the impact when successful imprisoned ex-officials
who had been untouched by the law. Many failure stories besides its success.
Some progress can be noted in the efforts to reform the compensation
system. The Minister of Finance has set up a task force to examine the entire
compensation package with the goal of creating a more transparent, systematic
and coherent framework of pay and allowances linked to a comprehensive review
of job classifications and categories.
In 2005 was a golden year in the SBY government corruption. It was
marked by the emergence of Presidential Instruction No.5 (Inpres 5) to encourage
and accelerate the eradication of corruption. The, in December 2005, the President
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instructed National Development Planning Board (BAPPENAS) to prepare the
National Action Plan for the Eradication (RAN-PK). In the plan suggests that
civil service pay should be increased to curb corruption. Evidence from
elsewhere, however, suggests that the link between government wages and
corruption is tenuous at best. Low earnings prompt individuals to seek alternative
sources of income. But high earnings are not sufficient to counter corrupt
practices.
In short, pay increases can play a role in changing behavior but they must
be part of an over all policy package designed to influence civil servant behavior .
It is important to begin by acknowledging that the President is genuinely
committed to fighting corruption, and he is supported in this effort by a small but
significant constellation of reform-minded actors inside and outside the
government who have the potential to make a difference. Moreover, his
comprehensive approach, with its emphasis on both punitive and preventive
measures, has considerable promise. However, there exist real political and
bureaucratic constraints on the pace and scope of reform. Because the president’s
cabinet is essentially a coalition government, his ability to push (or punish) his
Ministers and other senior officials is limited. And because the government’s anti-
corruption agenda involves action by many parts of the government, it requires
continual and active leadership.
It doesn’t appear that the office of the president has the capacity to
continually press the anti-corruption agenda. By way of example, the
government’s “National Action Plan for the Eradication” (RAN-PK) is in danger
of becoming nothing more than the bureaucracy’s way of doing the minimum
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required to show the president that it is complying with Inpres 5. As a result, the
President’s most significant action to improve governance has not been the
introduction of institutional reforms; but rather clamping down on standard
practices such as cronyism in appointments, political favoritism in commercial
and regulatory decisions, and political intervention in independent commissions
and oversight bodies.
The President has been less proactive in developing and implementing a
strategy of institutional reforms to reduce the incentives and opportunities to
engage in corruption.
To date, the most pronounced change has been in the area of punishing
corruption. There are a number of significant, and in some respects
unprecedented, steps being taken to uncover and punish corruption—such as the
invigoration of audits, investigations and prosecutions, and the pressure being
applied to reform the AGO, the police and the courts. These punitive measures are
important because they are sending a message that engaging in corruption is no
longer risk-free. But given the still limited capacity in Indonesia for exposing and
prosecuting corruption relative to the pervasiveness of the problem, it is unlikely
that by themselves, these measures will fundamentally change the risk-reward
calculation.
The KPK has posted some important successes with its investigations and
prosecutions, and it has helped to energize other anti-corruption efforts. However,
it has been less successful promoting preventive reforms, and its effort to collect
and investigate wealth reports of government officials appears lack luster. Even if
the KPK excels in prosecuting corruption, its overall impact will be limited if
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there aren’t significant and sustained reforms in the Attorney General Office
(AGO), Police, judiciary, auditing and procurement.
President Yudhoyono is committed to punishing corruption, and there is a
small but The Yudhoyono government’s approach to fighting corruption has a
number of notable characteristics: First, the president has made anti-corruption
“his” issue: to date he has not delegated leadership and oversight to anyone else in
his government. (However, the president appears to have designated the KPK as
his proxy in the fight against corruption.) Second, the president’s approach is
multi-faceted: it includes prosecutions, prevention and education. To date,
however, the most noticeable thrust has been in the realm of prosecutions. Third,
the approach is incremental and “rehabilitative”: the president seems to have ruled
out the wholesale replacement of government officials and instead believes that
they can be induced to stop their corrupt behavior. Fourth, it also appears to be
very attuned to political considerations. To date, there has been only limited
action taken against those at the apex of power in Indonesia, namely politicians
and generals who currently hold high level positions in the national government,
political parties or military. Finally, it is notable for the absence of any explicit
emphasis on investigating and prosecuting corruption by former president
Soeharto and his family and close associates—despite continued calls to do so
from civil society.
The President’s anti-corruption effort also is notable less for the
introduction of
institutional reforms than for an emphasis on ending a variety of practices that
historically have bred and abetted corruption, including cronyism in
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appointments, political favoritism in commercial and regulatory decisions, and
political intervention in independent commissions and oversight bodies. He has
been less proactive in developing and implementing a strategy of institutional
reforms to reduce the incentives and opportunities to engage in corruption.
Under President Yudhoyono, the number of anti-corruption prosecutions
has
increased, continuing a trend since 2001. This is the result of the combined efforts
of THE KPK, AGO, POLRI, BPK, PPATK and several other agencies. These
punitive measures are sending a message that corruption is not risk-free. Indeed,
many Indonesian commentators are already claiming that these measures are
changing the way bureaucrats behave, including causing them to slow down the
release of funds for government projects. But it is unlikely that by themselves,
these measures will fundamentally change the risk-reward calculation over the
long term.
To date, the impact of the national government’s anti-corruption initiatives
at the local level is also a mixed picture—which is not surprising given
decentralization. On the one hand, some 1,000 members of DPRDS (local
assemblies) across the country are under investigation for misuse of DPRD funds.
On the other hand, there continue to be numerous opportunities for corruption and
collusion at the local level.
The KPK has only a very limited reach beyond Jakarta and in most places
local auditing functions are still at a low stage of development. Moreover, the
capacity of local civil society groups and capacities to expose and prosecute
corruption are improving. An encouraging development is the national
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- To date, it appears the KPK has not aggressively collected or
investigated the wealth reports of senior government officials.
However, the KPK has taken steps to make the submission of complete
wealth reports easier, and KPK leadership assert that they are
scrutinizing the wealth reports of a number of “high profile” officials
and ex-officials.
- To date, the KPK has done relatively little in the area of corruption
prevention.
- Although the KPK has formed partnerships with several provincial and
kabupaten governments, its reach outside of Jakarta still is very
limited.
Because the KPK is new and is still in the process of defining its role (and
has become the most prominent actor in the fight against corruption), it is
important to be cognizant of a number of potential issues. These include:
First, there is the risk that the KPK will grow too quickly and spread itself
too thinly. In particular, there is a risk that if the KPK expands its efforts in the
area of prevention too rapidly, it will diminish its focus on prosecutions. Attention
must be paid to issues such as the KPK ’s comparative advantage and absorptive
capacity. Recognizing this, the KPK isn’t planning a major expansion of its
regional presence for several years.
Second, there also is the possibility that the KPK will avoid pursuing
politically-sensitive cases. To date, the KPK has not taken action against any
officials, politicians or generals currently in powerful positions in the government,
House of Representative (DPR) or Indonesia Military Forces (TNI).
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Third, the KPK faces a difficult challenge balancing its independence from
the AGO and the Police with the need to work with the law enforcement agencies.
Its effective will be reduced if it is too independent or becomes too close.
Finally, it is important to bear in mind that the KPK’s success with
prosecutions is dependent upon the integrity and competency of the Special Court
for Corruption.
It appears there are high public expectations regarding the government and
KPK’s anticorruption efforts. The 2005 Transparency International Global
Corruption Barometer indicates that Indonesians believe there has been a decline
in corruption over the last three years and are optimistic that it will decline even
more over the next three years. It is important that the government and KPK
manage expectations, deliver on their promises, and communicate their priorities
and progress to the public.
There is a risk that the government and KPK’s anti-corruption initiatives
will provoke a political backlash and/or public disappointment. Potential problems
include:
- The credibility of anti-corruption efforts could be undermined by the
appearance of partisanship and/or selectivity.
- Efforts to impose reforms on the judiciary could be seen as undermining
the independence of the judiciary.
- The failure of anti-corruption efforts to punish “big fish” or to improve the
availability or quality of public services could fuel public frustration and
cynicism.
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Fourth, the government must take meaningful steps to increase
transparency and disclosure in budgeting, procurement and project
implementation. In effect, this involves reducing opportunities and incentive
structure within the bureaucracy, and especially for the Yudhoyono government
and other anti-corruption agencies to produce a jobs with some measure of
confidence that they’ll be rewarded rather than punished.
Fifth, governments at the national and sub-national levels must increase
the scope, quality and integrity of internal and external auditing.
Sixth, with regard to combating corruption at the local level, one of the
most important things the national government can do is hasten and broaden the
reform of law enforcement, including the police, AGO and judiciary.
Seventh, civil society can play a larger and more important role than is
currently the case. The sectors of civil society where it appears there is the most
upside potential include universities, students, the media and professional
associations.
Finally, given Indonesia’s status as a new democracy, serious attention
needs to be paid to addressing the corrupting and corrosive influence of “money
politics” on political parties, elections and legislatures.
CONCLUSION
Performance of the executive or the government of SBY-JK 2004-2009
and KPK in combating corruption is still not optimally. Rather, it is found that the
policy even undermine efforts to eradicate corruption. There are many efforts
which have been programmed by SBY to fight corruption in Indonesia, one of
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which is to enhance the role of the Commission in eradicating corruption cases.
The President has been less proactive in developing and implementing a strategy
of institutional reforms to reduce the incentives and opportunities to engage in
corruption.
As of mid-2006, the anti-corruption track record of the Yudhoyono
government and the KPK is positive and encouraging in some respects, but
disappointing and worrisome in other respects. The mixed record is, to a
considerable extent, a reflection of the severity and complexity of the problem of
corruption in Indonesia. But it also is a consequence of shortcomings inherent in
some of the Yudhoyono administration’s approaches to addressing corruption.
Corruption in Indonesia can be attributed to the low salaries of the civil
servants and political leaders, the ample opportunities for corruption in many
public agencies, and the low probability of detection and punishment of corrupt
offenders. The consequences of corruption are negative for the country, but they
are less serious for Indonesia because of the National Counter Corruption
Commission’s efforts in curbing corruption. The anti-corruption strategies in
Indonesia would be more effective if their political leaders demonstrated their
commitment to curbing corruption like Singapore and Hong Kong, several years
ago was a very fertile country with the practice of bribery. Even the Hong Kong
ten years ago was a country known for dirty bureaucracy. But now these countries
have recognized the country that has a clean bureaucracy. Thus, following this
case, an effective anti-corruption strategy should reduce or remove the
opportunities for corruption, raise the salaries of civil servants and political
leaders, and ensure a high degree of policing.
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Background
Susilo Bambang Yudhoyono was re-elected on Indonesia election July 8,
2009 as the president of Republic Indonesia for next 5 years. In this second
period, Susilo Bambang Yodhoyono partnered with Boediono to lead Indonesia
which is highly expected more directed in fighting corruption than partnered with
Jusuf Kalla in fisrt his 5 years.