INDONESIA MASA ORDE BARU Stabilitasi Politik dan Rehabilitasi Ekonomi

Political and Economic Stabilization under the New Order (Orde Baru)
📌 Following the transition from the Guided Democracy era, President Soeharto implemented programs to create political stability and economic rehabilitation based on MPRS Decree No. 30 of 1967.
📌 Stabilization efforts focused on three main areas: foreign policy, domestic policy, and economic rehabilitation.

Foreign Policy Shift
📌 The New Order government shifted from President Soekarno's pro-Communist/Eastern Bloc foreign policy to a "free and active" (bebas aktif) stance, avoiding alignment with either bloc.
📌 Key diplomatic achievements included ending the confrontation with Malaysia through talks between Adam Malik and Tun Abdul Razak on May 29th.
📌 Indonesia rejoined the United Nations (UN) on September 28, 1966, and was appointed a non-permanent member of the UN Security Council.
📌 The government initiated the formation of ASEAN (Association of Southeast Asian Nations) via the Bangkok Declaration on August 8, 1967, involving Indonesia, Malaysia, the Philippines, Singapore, and Thailand.

Domestic Political Policies
📌 The first general election under the New Order was held in 1971, contested by nine political parties and one socio-political organization (Golkar), with Golkar emerging as the winner.
📌 In 1973, a political party fusion policy simplified the system from multi-party to a bipartite system (PPP and PDI) plus Golkar, ensuring Golkar's continued dominance in subsequent elections (1977 onwards).
📌 The ideology of Pancasila uniformity was enforced through the P4 Guidelines for the Appreciation and Practice of Pancasila (TAP MPR No. II of 1978), requiring all socio-political organizations to adopt Pancasila as their sole foundation (asas tunggal).
📌 The Dwifungsi ABRI (Dual Function of the Armed Forces) doctrine was implemented, integrating military members into both defense and socio-political roles, evidenced by their membership in the DPR/MPR and high-ranking civil positions.

Economic Rehabilitation Program
📌 Economic recovery, driven by Soeharto's private staff economists, focused on managing national debt through diplomacy and negotiation to reschedule payments.
📌 Cooperation was established with the IMF (International Monetary Fund) to secure necessary funding injections for development and gain international recognition for economic transactions.
📌 Laws were enacted to facilitate foreign and domestic investment: Foreign Investment Law (PMA) No. 1 of 1967 and Domestic Investment Law (PMDN) No. 6 of 1968, which included tax exemptions for eligible domestic investors.

Key Points & Insights
➡️ The foundational goal of the early New Order was achieving political and economic stability as a prerequisite for future development policies.
➡️ The shift to a free and active foreign policy was formalized by rejoining the UN and establishing ASEAN.
➡️ Domestic politics were stabilized through electoral reforms (1971) leading to a bipartite system and the mandatory adherence to Pancasila as the sole ideology (P4).
➡️ The Dwifungsi ABRI policy institutionalized the military's dominance in Indonesian socio-political life through parliamentary representation and civil service appointments.
➡️ Economic rehabilitation prioritized external debt restructuring and opening the economy to foreign and domestic investment via new legislation.

📸 Video summarized with SummaryTube.com on Jan 30, 2026, 12:34 UTC