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Indonesia's judicial system rated the worst in Asia: Survey
Lilian Budianto , The Jakarta Post , Jakarta | Mon, 09/15/2008 10:08 AM | Headlines
Indonesia's judiciary earned poor marks from expatriate business executives for having the worst system in Asia, in a survey conducted by a Hong Kong consulting firm.
Regional financial hubs Hong Kong and Singapore topped the list for having the best judicial systems on the continent.
The survey, conducted by the Political and Economic Risk Consultancy (PERC), ranked Indonesia last against the other 12 Asian countries.
The judiciary "is one of Indonesia's weakest and most controversial institutions, and many consider the poor enforcement of laws to be the country's number one problem," PERC said, as quoted by AFP.
The agency did not provide specific examples.
Indonesia's poor ranking stems from the executives' strong dissatisfaction with legal proceedings, which are dogged by systemic corruption, senior lawyer and human rights advocate Todung Mulya Lubis told The Jakarta Post on Sunday.
"It is not surprising Indonesia ranked at the bottom," he said.
"Indonesia has yet to give businesspeople the legal certainty crucial in the investment world."
Todung gave the example of the recent Supreme Court ruling against Singapore-based investment firm Temasek Holdings, which was found guilty of breaching anti-monopoly laws.
Analysts have said Temasek was subjected to disfavorable divestment for "confusing and illogical reasons" made under the 1999 Competition Law. Temasek has continued to insist on its innocence.
The PERC survey confirms findings in several previous surveys. A recent report by the World Bank and its private arm, the International Financial Cooperation, showed Indonesia ranked 129th out of the 181 countries surveyed in terms of doing business.
In December 2007, a Transparency International Indonesia study ranked the judiciary as the most corrupt institution after the police.
A survey conducted by the Corruption Eradication Commission this year put the Attorney General's Office as the least credible for fighting corruption, followed by the courts and the police.
Hong Kong's judicial system topped the vote with a score of 1.45 on a scale where zero represents the best performance and 10 the worst.
Regional rival Singapore was in second place with a score of 1.92, followed by Japan (3.50), South Korea (4.62), Taiwan (4.93) and the Philippines (6.10).
Malaysia was in seventh place with a score of 6.47, followed by India (6.50), Thailand (7.00) and China (7.25). Indonesia's lowest score of 8.26 came after Vietnam's 8.10.
Survey respondents were 1,537 corporate executives working in Asia. They were asked to rate the judicial systems in the countries where they reside, using such variables as the protection of intellectual property, corruption, transparency, enforcement of laws, freedom from political interference and the experience and educational standards of lawyers and judges.
PERC said the less favorable perceptions of China's and Vietnam's judicial systems were rooted in political interference, adding the Communist Party "is above the law in both countries".
Although India and the Philippines are democracies, expatriates did not look favorably on their judicial systems because of corruption, PERC added.
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Dr. m (not verified) — Mon, 09/22/2008 - 11:53pm
First of all, don't blame PERC for the survey result! It's just a survey, and the result is the result. Blaming PERC and refusing to accept what they said is very Soeharto style. But, of course you may have disagreement.
I disagree with them. The survey result is the upper bound of HK judicial system quality while it is the lower bound of Indonesia judicial system quality.
The respondents are business executive. They are the subject of judicial system, and they are to large extent representative of large corporations. Clearly we expect them to not understand law (remember, they are not lawyer). Instead, they (as judicial subject) will expect to win whatever the case they are in, regardless of the merit of the evidence presented or the law on book.
HK and Singapore (the top 2) are consistently the champion of free market. In free market regime, these large corporations are free from ferocious labour unions, draconian employment law, and long investment ban list. The business executives (who do not understand law) will most of the time win their cases. Therefore the business executives will favourably give high score to HK and Singapore.
Now, let's look at Indonesia. Indonesia is unmistakably a socialist country. Ferocious labour unions, draconian employment law, and long investment ban list clearly make life difficult for business executives. Being a subject of (unfavourable) law, these business executives will give low score to Indonesia. However, what makes judicial system is admirable or admonished is not whether the country is staunchly capitalistic or socialist. Instead, it's whether the legal outcome is predictable. True, that legal outcome in Indonesia is far cry from predictable; that's why I wrote in the 2nd paragraph that the survey result is the lower bound of Indonesian judicial quality system.
Viv (not verified) — Mon, 09/22/2008 - 2:14pm
As an expat working in Indonesia we call it the race to poverty. However, we would not call it corruption, it is simply extortion. Every petty official and NGO competes to outdo each other to create problems so they can then extract payments from us to help fix them. To win a few thousand in payments, millions of dollars of wealth is destroyed and investments lost. The people of Indonesia are the main losers here as virtually all the of the wealth destroyed would have found its way into the local economy.
Jim (not verified) — Mon, 09/22/2008 - 7:38am
I have to laugh at some of the responses. The same was true of the Indonesian government response to the survey from the world bank. What? Do you think the world is out to get you? They are telling you that you have a real problem, yet no one in the country wants to listen. You have everything here, huge population, strategic location, natural resources that are the envy of the world. Yet your people mostly live in poverty. Maybe you should listen to what others have to say. This country should be a super power but will never achieve anything unless you listen to the criticism and do something about it. Corruption on a scale like no other I've seen....even Ramadan corruption...my internet turned off every year during Ramadan so I have to pay someone to come out and turn on again....always something!
Wiseman (not verified) — Fri, 09/19/2008 - 11:57am
If you do a simple COST BENEFIT ANALYSIS (and cast aside all the righteous proclamations), it is obvious who benefit most: the Western big companies !. Hypocrisy knows no limits. They Come, They Taught, They Conquered !!!
Richard (not verified) — Thu, 09/18/2008 - 1:26pm
This just brings up a fact (about corruption) which should be actually quite obvious already. Big companies may thrive when only them have the sufficient funds to buy legal system behind them to make even more money but again obviously that is a tragedy for everyone else.
Then these surveys give us just 'collective opinions' of some group which was selected to be interviewed. There is yet to be desired that actual studies with quantitative information were conducted.
Who said so (not verified) — Mon, 09/15/2008 - 12:57pm
Please don't blame me, I have nothing to do with any corruption. I am so busy praying 5 times a day and so were the others.
How can they rank us so poorly. They must be corruptors too in the ranking, what you say ??
Mark Austin (not verified) — Mon, 09/15/2008 - 12:26pm
It is not just that the rich in Indonesia are getting richer while the poor get poorer, thanks to corruption. It is also that corruption makes the country financially poorer as a whole. So the corruptions make the RI financial pie comparatively small accordingly, then eat virtually all of it themselves.
Tecnical Expat (not verified) — Mon, 09/15/2008 - 11:49am
What did you expect? Hong Kong & Singapore are centers of Western Banking which want interference free financial systems to favor them 100% if possible. These are tiny cities and depend on handouts/crumbs of the western banking. You cannot have the same one-way street to exploit large countries with desperate populations.
This survey is laughable, of course the expatriate business executives would like to have the last century back.
Speaking of corruption.....what's happening to the western banking system?.....anyone being held responsible for such a meltdown??... Also look at the exponential rise in arm business around the world!.........zillion times worse than the financial crises on the Far East of the late 90s!