- As Indonesia gears up for legislative and presidential elections in less than a year, authorities have warned of the pattern of dirty money from illegal logging, mining and fishing flowing into past campaigns.
- Experts say the practice of candidates taking this money from companies that exploit natural resources is common, given the high cost of running a campaign.
- This then perpetuates a tit-for-tat cycle that sees the winning candidate pay back their funders in the form of land concessions and favorable regulations.
JAKARTA — Funds from illegal logging, mining and fishing are flowing into election campaigns in Indonesia, authorities have revealed.
The announcement by the national anti-money-laundering watchdog, known as the PPATK, during a parliamentary hearing comes less than a year before the country is scheduled to hold legislative and presidential elections.
PPATK head Ivan Yustiavandana said his agency had found indications that candidates in the 2014 and 2019 elections used money raised from the illegal extraction of natural resources to fund their campaigns. He did not identify the candidates, including whether they ran in the legislative or presidential elections those years.
“We can’t disclose the amount here, but it’s huge,” Ivan told lawmakers in Jakarta on Feb. 14. “The original crime itself is trillions of rupiah [in amount], because it’s related to many crimes that are linked to natural resources, and this money goes into certain individuals who we suspect as political persons.”
Official data show that illegal logging costs the country 35 trillion rupiah ($2.3 billion) in state losses each year, while illegal mining results in 3.6 trillion rupiah ($233 million) in state losses.
Ivan said the PPATK is working together with the country’s General Elections Commission, or KPU, and the Elections Supervisory Agency, or Bawaslu, in investigating the flow of money.
Responding to the findings, lawmaker Arsul Sani from the PPP party called on the PPATK to provide a detailed report on its findings, including identifying the parties that benefited from these funds. This could then form the basis for filing a criminal complaint, he added.
KPK spokesman Ali Fikri said the commission would follow up on the PPATK’s finding once it received a formal report. However, he noted that the KPK’s scope of investigations only covers corruption and bribery, and that if the flows of money from illegal logging, mining and fishing don’t involve bribery, then the KPK can’t act.
Edward Aspinall, an expert in Indonesian politics at Australian National University (ANU), said the use of illicit money to fund political campaigns is to be expected because the cost or running for public office is very high.
Candidates have to raise massive amounts of money for things like campaign events and handouts to voters, even if running for a city council seat. In many cases, they get funding from businesses in the natural resources industry, like mining and plantations, or are sometimes business owners themselves, Aspinall said.
“It’s common in rural districts in Indonesia [that] plantation companies’ owners, mining companies’ owners are the major investors in the campaign of political candidates,” Aspinall said during a recent online event.
Should the candidates win office, they’re expected to pay back the businesspeople who funded their campaigns. This often comes in the form of favors such as land concessions or regulatory changes that benefit the companies, Aspinall said.
He cited the case of an unnamed major nickel operation on the island of Sulawesi that’s funding all of the leading candidates running in local elections there. This model, Aspinall said, has become the pattern in Indonesia.
“So we see a political system that generates few dynamics, few checks on natural resource exploitation and deforestation, but provides incentives to political and economic elites to perpetuate deforestation,” he said.
This practice is illegal and violates existing campaign finance regulations, he said, but is largely going unreported to the authorities. This is because a large chunk of the election funding goes toward more illegal activities — typically vote buying, he said.
“The fundamental problem here is that there’s very little enforcement of existing campaign finance regulations,” Aspinall said.
Banner image: Illegal logging operation in Borneo, 2013. Image by Rhett A. Butler/Mongabay.
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