Tenure congratulating Megawati Sukarnoputri on her
inauguration as president On 23 July 2001, the People's Consultative Assembly (MPR)
removed Wahid from office and subsequently
swore in Megawati as the new president. She thus became the
sixth woman to lead a Muslim-majority country. On 10 August 2001, she announced her
Mutual Assistance Cabinet. . Standing beside her was US president
George W. Bush. The rise of an icon of opposition against the Suharto regime to the presidency was initially widely welcomed, however it soon became apparent that her presidency was marked with indecisiveness, lack of clear ideological direction, and "a reputation for inaction on important policy issues". The good side of slow progress of reforms and avoiding confrontations was that she stabilized the overall democratization process and relationship between legislative, executive, and military. These amendments contributed to the formation of the
Constitutional Court and the dissolution of the
Supreme Advisory Council. Megawati Sukarnoputri also established the first general election system, where the Indonesian people can directly elect the president and vice president, in addition to electing legislative candidates. As a result, she was given the title "Mother of Upholding the Constitution". Megawati Sukarnoputri also played an important role in the formation of the Corruption Eradication Commission, an institution tasked with eradicating
corruption in Indonesia. In eradicating the rampant corruption inherited from the
New Order, she formed the
Corruption Eradication Commission (KPK). The formation of the KPK was based on Megawati's view that many legal institutions at that time were not clean, so the KPK needed to be formed. Long before that, the initial idea for forming the Corruption Eradication Committee emerged in the era of President
BJ Habibie who issued Law Number 28 of 1999 concerning State Administration that was clean and free from corruption, collusion and nepotism.
Defense and Security The
Indonesian National Armed Forces has undergone changes in order to suit their new roles in the democratic administration to be a military force that is more dynamic, ever-ready and flexible to changes. This is specified by Megawati on the following quote:
Aceh On 19 May 2003, in response of
GAM refusal of the Tokyo peace deal which planned to end the
decades long insurgency in Aceh, Megawati gave the 12th Indonesian Military Chief General
Endriartono Sutarto, permission to commence
military operations against the GAM separatist. General Sutarto also imposed martial law in Aceh for a period of six months and the Indonesian government subsequently deployed 1,500 soldiers and 12,000 police to the province. During the military operation, government forces would conduct numerous human rights abuses including torture, rape, forced disappearances, and murder. An estimated 1,159 rebels died with 147 civilians were killed and 155 wounded during the operation.
Papua Under Megawati, Indonesia reaffirmed its presence in Papua and positioned itself as the central government and ensured that the doctrine of independence and the ideas of freedom and self-determination did not emerge. Under the Megawati’s administration, West Papuan independence activist
Theys Eluay was assassinated. Megawati’s government also postponed the implementing regulations for the establishment of the Papuan People’s Assembly (Majelis Rakyat Papua), and favored the issuance of a presidential decree to implement Law No. 45/1999 to divide Papua into three distinct provinces.
Foreign policy Her administration's foreign policy largely maintained the notion of non-alignment while conducting partnerships in efforts to quell terrorist attacks at the aftermath of the
September 11 attacks and
2002 Bali bombings. Shortly after her inauguration, Megawati visited the
United States on September 19, 2001 and had a meeting with President
George W. Bush where both countries pledged to cooperate against radical Islamic terrorism based on shared democratic values. She also sent her condolences to the victims of the September 11 attacks while telling Bush Indonesia also has the same mission against terrorism. The engagement with President Bush marked a renewal of ties which were previously strained under President
Bill Clinton, including discussions on military cooperation and training programs with Indonesia. The
2002 Bali bombings which killed 202 people, among them 88 Australians prompted Megawati to intensify international cooperation against terrorism. Her administration issued two presidential decrees in lieu of legislation to address terrorism and arrested key suspects, including radical Islamic cleric
Abu Bakar Ba'asyir. In a joint press conference on 2003, President Bush commended Megawati's leadership in confronting terrorism and supported her reforms in civil-military administration while also proposed to send a $157 million aid to support basic education for Indonesia. The United States also reaffirmed commitments to military education exchanges and partnerships in regional security.
Economic arrangement Since her inauguration, Megawati's administration strive to provide conditions that conducive to rebuilding the economy that has been in ruins ever since the
1997 Asian financial crisis and the political crisis since
Suharto's fall between 1998 and 2001. During the early periods of her administration, Indonesia has US$105.8 billion in debt which was inherited from
Suharto's regime. As president, she attended
Paris Club and
London Club meetings in an attempt to renegotiate Indonesia's outstanding debts which result in Megawati able to delay the payments of US$5.8 billion of debts in a Paris Club meeting in 12 April 2002 and prepared a debt payment of Rp.116.3 billion on 2003. According to Megawati, the privatization of SOEs is done to defend SOEs from public intervention and debt payments, to increase efficiency and competitiveness of the SOEs and to speed up economic growth from the private sector. In her own journal, Megawati's privatization drive has successfully increased economic growth by 4.1% and suppressed inflation by 5.06%. Megawati restored cooperative relations with the
International Monetary Fund (IMF) which has been delayed during
Wahid's presidency by tasking
Coordinating Minister for Economic Affairs Dorodjatun Kuntjoro-Jakti,
Minister of Finance Boediono and
Governor of Bank Indonesia Burhanuddin Abdullah to fulfill 20
letters of intent from the IMF and
World Bank which affects with the disbursement of an IMF loan of around SDR 400 million to strengthen the position of foreign exchange reserves for each LOI received. One of her national development focus and leading sector is Indonesia's marine and fisheries economy. On 7 June 2003, Megawati on board
KRI Tanjung Dalpele launched the National Movement for Maritime and Fisheries Development (GERBANG MINA BAHARI). In essence, the movement establishes the Maritime and Fisheries sector, Maritime Tourism, Maritime Industry and Services, and Maritime Transportation as the prime mover of national economic development. Simultaneously, other development sectors and political-economic policies support these prime mover sectors. Meanwhile, the basis of Maritime and Fisheries development is Sustainable Development, namely harmonizing efforts to increase economic growth, equal distribution of welfare and environmental preservation.
2004 general election Incumbent president Megawati Sukarnoputri was the PDI-P's top nominee, seeking to become the first woman elected in her own right as president of a Muslim-majority country. She was joined by vice-presidential candidate
Hasyim Muzadi, general chairman of Indonesia's largest Islamic organisation
Nahdlatul Ulama (NU). The pair was assigned the number
2 for its ballot. However, she was decisively defeated by
Susilo Bambang Yudhoyono in the second round, by 61 percent to 39 percent, ==Post-presidency (2004–present)==