T

he full ownership transfer of aluminium producer PT Indonesia Asahan Aluminium (Inalum) from a Japanese consortium to the Indonesian government is supposed to be much more substantial than just a movie perceived as the icon of the 55th anniversary of diplomatic relations between Indonesia and Japan. The cooperation contract between the Indonesian government and a Japanese consortium officially expired on Oct. 31.

The Japanese government seems very enthusiastic with the filming of the TV film Aishiteru '€” which is jointly produced by Japan and Indonesia and is to be aired by Kompas TV in December and by Fuji TV in January.

Japanese Ambassador to Indonesia Yoshinori Katori reportedly praised the film as an excellent description of the beautiful friendship between Japan and Indonesia. The two countries opened their diplomatic ties in April 1958, 13 years after Japan ended its 3-year occupation following its defeat in World War II.

But why has the Japanese side '€” both the government and the private sector '€” chosen to take a very quiet stance on such a historic company? Inalum was supposed to be a model cooperation that the two countries could be proud of when the program ended.

A model transfer of technology and a dream cooperation between an industrialized and a developing country. It could have been a perfect piece of propaganda, if necessary.

The company was one of Japan'€™s most historic development cooperation efforts and originally aimed to become an excellent example of Japan'€™s sincerity to Indonesia. An agreement on setting up Inalum was signed on July 7, 1975, one year after anti-Japanese violence hit Jakarta. It was a part of a massive damage control strategy.

On Jan. 15, 1974, anti-Japanese riots exploded in Jakarta during the visit of then Japanese prime minister Kakuei Tanaka. The rioters were protesting against Japan'€™s economic hegemony.

There were several elements to the anarchic protests, including political struggles among then president Soeharto'€™s inner circle, but the anger at Japan'€™s economic domination and at the behavior of Japanese businesspeople in Indonesia were very strong at the time.

Former Indonesian president Soeharto closely monitored developments on Inalum until his fall in May 1998. As a reporter, I remember Asahan Development Authority chairman AR Soehoed reported to Soeharto every month. Soehoed was involved in Inalum from the very beginning.

Indonesia has acted elegantly and correctly in ending the historic joint venture, as stipulated by the agreement to take over Inalum, including its readiness to pay US$558 million to purchase the consortium'€™s 58.88 percent stake so that it could wholly own the company. The House of Representatives gave its approval just one day before the deadline.

Ironically, the Japanese side '€” Nippon Asahan Aluminum '€” reportedly threatened to bring the case to international arbitration as it wanted more compensation ($626 million). The consortium comprises 12 Japanese giants, including Sumitomo Chemical Co. Ltd., Sumitomo Shoji Kaisha Ltd., Mitsui Aluminium Co. Ltd. and Mitsubishi Cooperation.

It is hard to understand why the consortium told the government of its intention to bring the case to the International Center for Settlement of Investment Disputes. Is it just because it wanted more money (the amount was too small for such global corporations), or was it because it still wanted to remain the majority shareholder of Inalum?

The Indonesian government has been very open about the issue. It even told the Japanese side of its final decision to end the joint venture as scheduled in October 2012. Most information on the Inalum case came from the government.

The Japanese side hardly provided any statements to the Indonesian media. The Japanese government, through its embassy in Jakarta, took a similar stance. Given the history of the joint venture, it was necessary for the Japanese government to provide public information.

'€œAs of Nov. 1, all Inalum assets have been returned to the Indonesian government. The company is now a new entity under the management of the State-Owned Enterprises Ministry,'€ Industry Minister MS Hidayat said on Friday.

There are fears the Indonesian government will not be able to manage the company as well as when it was under Japanese control, but that is another issue.

It is regrettable the Japanese consortium plans to take this up as an international issue. It was originally intended to be a symbol of Japan'€™s sincere commitment to Indonesia when it was founded.

Should we put aside noble idealism just because of money (and an embarrassing dispute for Japan'€™s multinational giants)? Hopefully, I am wrong.

Anyway, next year is the 40th anniversary of the anti-Japanese riots.