141. Special National Intelligence Estimate0
Washington, August 12, 1958.
THE OUTLOOK IN INDONESIA
To assess the current situation in Indonesia, and to estimate the probable main lines of development.
- Events in Indonesia during the last year have greatly strengthened the position of the Indonesian Communists (the PKI). If the national elections scheduled for 1959 are held, the PKI will probably emerge as the largest party in Indonesia and be in a strong position to demand cabinet representation. (Paras. 22–23, 25)
- We believe that the PKI will continue its present policy of seeking to attain power by legal means. The PKI will probably not attempt to seize power by force during the coming year, even if large numbers of army units are still committed in the outer islands. (Para. 24)
- The continuing guerrilla actions of the rebels constitute a considerable military and financial burden on the government. The rebels can continue such actions for a prolonged period and, with outside arms support, could seize and temporarily hold sizable areas. Even in these circumstances, however, the rebels could probably neither develop widespread political support nor create sufficient military pressure to cause the government to seek a negotiated settlement. (Paras. 12–14)
- The leaders of the armed forces gained self-confidence and prestige in their operations against the rebels. In the face of the increasing power of the Communists, army leaders have considered measures to move against the PKI, including a proposal that the elections be postponed. However, we do not believe that they will take any decisive action unless they have at least the tacit approval of Sukarno. (Paras. 15–16, 19–21)
- Sukarno is also concerned by the growing power of the PKI. However, he is reluctant to use force or to abandon his position of being above party struggles. We believe that he will at first seek to consolidate and strengthen non-Communist parties so that a balance between them and the PKI may be achieved. If he becomes convinced that the Communists seriously threaten his position, he will probably yield to army pressures to postpone the elections. However, we believe that the chances are no better than even that he could be convinced that his position would be threatened. (Paras. 26–27)
- Economic conditions, which have been deteriorating for years, have worsened since the seizure of Dutch economic interests and the outbreak of civil war. Most productive facilities and foreign trade transactions are now in inexperienced hands. Due to the shortage of raw materials the industrial sector of the economy faces partial paralysis, although the peasant economy, in which some 80 percent of the population is included, has been comparatively little affected. (Para. 28)
- Continuing and substantial US aid would increase the ability and determination of non-Communist leaders to resist the growing power of the PKI. However, the best that could be hoped for would be that non-Communist forces would be so strengthened that the PKI could not come to power, although it would still remain a major force in Indonesian politics. (Para. 34)
[Here follows a 6-page Discussion section; see Supplement.]
- Source: Department of State, INR–NIE Files. Secret. According to a note on the cover sheet the CIA and the intelligence organizations of the Departments of State, the Army, the Navy, the Air Force, and the Joint Staff participated in the preparation of this estimate. All members of the LAC concurred with the estimate on August 12, except the representatives of the AEC and the FBI, who abstained on the grounds that the subject was outside their jurisdiction.↩