Introduction: National Institutions and the Politics of Adjustment to Globalization

Abstract

1997 was a hard year for Indonesia. Plantation companies had started forest fires in Sumatra and Kalimantan to clear new land. Now these fires had got out of control. During autumn the fires had developed into environmental disasters which destroyed enormous land areas, and polluted large tracts of Indonesia and Southeast Asia. Meanwhile, Indonesia was badly affected by the currency and financial crisis that hit several of her neighbouring countries. The exchange rate fell and the country’s foreign debt escalated. Agriculture was also affected by a major drought. On top of these problems a political succession crisis broke out as the ailing President Suharto declined to nominate a successor.