INTRODUCTION

Batam's development process has been quite unique among medium-size cities in Indonesia, as it has developed virtually from scratch. In the late 1960s, there were 6,000 people on the island, essentially fishermen and their families. Since then, Batam's population has been growing by leaps and bounds, and the number reached approximately 1.37 million people by 2019 (BPS 2019).

Over the decades, due to its proximity to Singapore and, through it, international capital, Batam has always been accorded one or another form of special status with certain privileges. Beginning in 1971, the government promulgated a series of regulations that were pivotal to the subsequent development of Batam. Then, it was merely an outpost station of the national oil company, PN Pertamina, which provided logistics and operational support to its offshore exploration activities. In 1972, Nisho-Iwai, a Japanese consultancy firm and Bechtel Corporation of the United Sates prepared a master plan for the development of Batam (Pertamina, Nisho-Iwai, and Pacific Bechtel 1972).

In 1973, the central government passed the Presidential Decree No. 41 which declared all of Batam island as an industrial zone (BIDA 1980). One important provision of the decree was the establishment of Batam Industrial Development Authority (BIDA) as the sole entity responsible for the island's economic development. BIDA was endowed with an extensive range of responsibilities to, among other things: develop and manage Batam as an industrial area; handle transshipment activities; plan and manage the island's infrastructure development; and expedite business licensing processes. B.J. Habibie, the Minister for Research and Technology, became BIDA Chairman in 1978 and took a direct interest in the island. He saw it as a means of concentrating scarce resources in a given location and bypassing many of the infrastructural problems facing other parts of the country. This support also allowed BIDA to deal with the relevant local governments within Riau Province effectively and, hence, enabled it to roll out infrastructure and promote business development on the island (Hutchinson 2017).

In 1978, the government designated all of Batam island as a bonded warehouse zone. Often referred to simply as a bonded zone, this is an area where dutiable goods may be stored, processed, or manufactured without paying duty.

INTRODUCTION

In providing an overview summary of trade union activity in Batam, this chapter analyses the region's political history over the last several years. This approach is employed because there appears to have been a strong surge in national trade union reorganization activity since the end of the New Order in 1998. Explaining the evolution of that history, and how it has manifested in Batam, has determined the framework for this chapter. It is structured as follows: the first section provides a basic outline of historical and social context, both of the trade union sector as well as of some other aspects of Batam; the following section describes the history of the emergence of industrial militancy nationally and in Batam; the third elaborates on the process that has led to a decline of that hostility; and, the conclusion sketches out the implications of this history of the rise and decline of such combat.

HISTORICAL AND SOCIAL CONTEXT

Batam is a unique site of development, consciously created to take advantage of its proximity to Singapore. It is therefore to some extent “artificial” in a sense that its sociology and economy have evolved as an enclave offshoot of Indonesia's economic connectivity with Southeast Asia. This is particularly reflected in its demography, both in terms of originating ethnicity, as well as political demography. It should be noted that in contemporary Indonesia, ethnic and political demography overlap with each other as most political parties represented in the national parliament have specific geographic areas where their support is strongest.

Before delving deep into the trade union situation in Batam, it is pertinent to briefly discuss its demography. The central and salient feature here is the major immigrant population, which has come into being over an approximate fifteen-year period. The original indigenous population of Batam Malays now exists alongside Javanese, Batak, Minangkabau and other Malay Sumatran immigrants, which gives the Batam population and society the character of a frontier, or new society. By 2010, across the whole province of Riau, “Malays”—presumably local Malays—formed only 30 per cent of the population.

INTRODUCTION

According to the 2010 population census, Bataks comprise 12.5 per cent (209,000) of the total population of the Riau Islands. They are the third-largest ethnic group after the “host” ethnic group, the Malay, and then the Javanese, which account for 31 per cent and 25 per cent of the population, respectively. As a sizeable migrant community in the Riau Islands, the Bataks play a role in both the economic and political life of the province. This chapter deals with the migration of Bataks to the Riau Islands and their political aspirations in their new home.

Traditionally, the Batak is one of the Indonesian ethnic groups most prone to voluntary migration. There are many motives for Batak migration, however, traditional understandings of social and economic capital articulate several forms of success, which individuals should strive for. They include: progress (hamajuon); higher education (hagabeon); wealth and the capacity to be generous (hamoraon); and glory (hasangapon), which refers to securing a high position in the government or the military.

Many male Bataks have played a role in Indonesia's political history. Indonesians generally would remember Mr Adam Malik Batubara, former Vice-President of Indonesia under Soeharto, and prominent generals such as A.H. Nasution, T.B. Simatupang, Feisal Tanjung, and Luhut Binsar Pandjaitan (currently Coordinating Minister for Maritime and Investment Affairs).

On an individual level, these names have become an inspiration for many Bataks. This can be seen in how Batak migrants aspire to gain political positions in the places where they reside. In Riau Islands, for example, several Batak migrants have succeeded in attaining elected positions, the most prominent of whom is Jumaga Nadeak, the current Speaker of the provincial parliament.

This chapter aims to answer the following questions: First, how does tradition shape the political aspirations of Batak migrants to the Riau Islands? Second, how do Batak migrants in Riau Islands play a role in the province's political life? Third, how do Bataks, as politicians, interact with other ethno-religious groups in the Riau Islands?

To answer these questions, the chapter starts with a brief note on Batak political history. It then highlights the traditional motives of migration among the Bataks and their movement to Riau and the Riau Islands

INTRODUCTION

Situated at an important trading crossroads in the precolonial and colonial periods, the Riau Islands have long been open to external influences. People of various ethnicities came to the region to trade, barter, and grow a variety of crops for export. This diversity has further increased in recent decades as, following the turn towards export-oriented industrialization in the 1990s, people from all over the country came to the Riau Islands in search of formal sector jobs—driving up the area's population and further increasing its heterogeneity.

While many different communities trace their arrival and establishment in the province to the post-1990 period, it is also home to a significant Chinese population. Playing a significant role in the Riau Islands’ cultural, political, and economic life, this community has long been an integral part of the region, with a presence dating back to the seventeenth and eighteenth centuries.

This chapter will explore how the Chinese community arrived in the Riau Islands and how it has negotiated its place within it. To this end, it is comprised of six sections. Following this introduction, the next section will trace the history of the Chinese community in the Riau Islands. The subsequent part will set out what aspects of Chinese culture are expressed in daily life in the province. The fourth will look at the role played by ethnic Chinese politicians in the province. The fifth will explore the trajectories of prominent Chinese businessmen. The sixth and final section will conclude.

THE HISTORY OF THE CHINESE COMMUNITY IN THE RIAU ISLANDS

Available records indicate that the arrival of the Chinese community in the Riau Islands began in the seventeenth century, due to the archipelago's location on the Chinese maritime Silk Road. Junks travelling to and from China are reputed to have stopped at Bintan for supplies, as well as to trade tea, ceramics and silks in exchange for opium from India, in addition to tin and pepper from the Riau Islands (Trocki 2007, p. 36; Shi and Xu 2017, pp. 82–83).

Over time, Chinese traders spread to other nearby locations such as Singapore and Johor.

In 2012, the ISEAS – Yusof Ishak Institute embarked on an ambitious research project to understand the cross-border regions of Southeast Asia. Aptly designated “Floating Frontiers”, the project focused not on the land borders, but the maritime areas. It has long been recognized that the countries of maritime Southeast Asia—Indonesia, Malaysia, Singapore and the Philippines—share a history of rich connectivity in centuries past through movements of its seafaring peoples and development of strong networks of economic, cultural and social ties.

There have been three attempts in maritime Southeast Asia to create subregional projects. SIJORI (Singapore-Johor-Riau Islands) is the first and the most developed. BIMP-EAGA (Brunei-Indonesia-Malaysia-the Philippines-East ASEAN Growth Area) is the second, and the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT) the third.

Regarding SIJORI, in the 1970s and 1980s, Singapore and Malaysia saw deep and mutually beneficial engagement in cross-border investment and trade. The contemporary interest of Singapore in the Riau Islands began later in the late 1980s with Batam. That soon gained momentum, moving beyond Batam to Bintan and Karimun. Since the governments of Singapore, Malaysia and Indonesia decided to promote SIJORI, the growth triangle has seen the three territories register population and palpable economic growth.

This research project has produced its first fruit, a SIJORI trilogy. The SIJORI Cross-Border Region: Transnational Politics, Economics, and Culture was the first volume. Then came Johor: Abode of Development? The third book The Riau Islands: Setting Sail is the final volume in the trilogy. Together, the three volumes provide a textured and qualitative understanding of subregional architectures and the resulting dynamics. We hope the analyses, the body of knowledge and data can be of use by highlighting the necessary refinements and adjustments that officials and investors may wish to make to the existing framework in light of changing developments.

The Riau Islands documents and analyses what is happening on the ground and the potential of the islands. It covers a large area and the spillover of dynamism arising from its location at the fortuitous nexus of Indonesia, Singapore and Malaysia. In the thirty years since SIJORI was launched, the Riau Islands has emerged as the richest province in Indonesia, second only to Jakarta.

INTRODUCTION

Natural and cultural wealth are important components of tourism in Indonesia which, with more than 17,500 islands, is the world's largest archipelagic country. Leveraging on these assets, this sector has become a key driver of Indonesia's economy. Based on data from the country's Central Statistics Agency (BPS), in 2018, tourism outperformed other key foreign exchange earning sectors such as oil and gas, as well as coal and palm oil, contributing US$19.3 billion (BPS 2019a). The sector is also growing quickly, jumping 13 per cent in 2018 to reach 15.8 million visitors (Soenarso 2019).

Based on BPS data, in 2018 some 59 per cent of tourists visited Indonesia for holiday purposes, while 38 per cent did so for business (BPS 2019). From the ASEAN region, Malaysia and Singapore are the two biggest sources of tourists coming to Indonesia. From elsewhere in Asia, Chinese tourists came first, followed by Japan, South Korea, Taiwan and India. The highest number of tourist arrivals from the European region came from the United Kingdom, followed by the Netherlands, Germany, and France.

Tourism has also become one of the key sectors of the Riau Islands’ economy. The Riau Islands is a province with some 2,000 islands (BPS Provinsi Kepulauan Riau 2018) located in the western part of Indonesia, bordered by Singapore and Malaysia. Due to its many coastal areas and vast expanses of sea, the province has a variety of tourist attractions and offers some world-class accommodation and leisure facilities.

In July 2004, the Riau Islands seceded from Riau to form a separate province. The young province includes six main island groups, including Batam, Bintan, Karimun, Singkep-Lingga, Anambas, and Natuna. The capital city is Tanjungpinang on the island of Bintan. However, the largest and the most industrialized city in the province is Batam.

In recent years, the tourism sector has become increasingly important for the Riau Islands, due to its dynamic growth as well as a downturn in other areas of the economy such as the electrical and electronics as well as ship-building sectors (Hutchinson 2017; Negara 2017). Table 3.1 shows how tourism (represented by “Accommodation and Food & Beverages”) has become a growth motor for the province.

INTRODUCTION

Regardless of their size or physical characteristics, all territories face formidable challenges in striving for equitable development. However, as an archipelagic province, whose 1,994 islands are scattered throughout some 427,600 km2 of sea, this is particularly daunting for the Riau Islands.

Moreover, the Riau Islands’ economy has slowed down in recent years, mainly driven by the recent slump in the manufacturing sector, mainly centred on Batam (Hutchinson and Negara in this volume). The province's dependency on this sector, which is largely concentrated in one part of its territory, indicates the success of the formerly named Batam Industrial Development Authority (BIDA) in pursuing the “Factory Asia” development model (Choi and Rhee 2014). Yet, on the other hand, it shows a structural vulnerability, as any shock to the manufacturing sector will certainly have a significant impact on the province's overall economic health. Consequently, the Riau Islands Province faces two key challenges: first, diversifying its economy to underpin sustainable growth going forward; and second, ensuring that the benefits of this growth are spread to a maximum within the province.

To this end, this chapter is comprised of five sections. Following this introduction, the second section sets out the basic characteristics of the Riau Islands’ economy. The third provides a brief review of the province's economic development over the past few years. The fourth provides some ideas for addressing the economic imbalance in the province, and the fifth concludes.

THE RIAU ISLANDS’ ECONOMY

The Riau Islands Province consists of: five districts, Bintan, Karimun, Anambas Islands, Natuna and Lingga; and two municipalities, namely, Batam and Tanjungpinang. In 2018, the province's population stood at 2.14 million, of which approximately 1.33 million or around 62 per cent lived in Batam. An additional 367,000 people lived in Bintan (including Tanjungpinang) and 231,000 in Karimun (BPS Provinsi Kepulauan Riau, 2019). Together, these three islands constitute about 90 per cent of the Riau Islands’ population—indicating the province's economic and demographic centre of gravity.

The Riau Islands Province is rich in natural resources, such as minerals, oil, natural gas, and fisheries. The province's water, which constitutes around 97 per cent of its total area, contains large quantities of marine resources, in particular plentiful stocks of fish.