Office of the Historian

228. National Intelligence Estimate1

Washington, February 15, 1967.

PROSPECTS FOR INDONESIA

The Problem

To assess current trends in Indonesia and to estimate prospects over the next year or so.

Conclusions

A.
Suharto and his anti-Communist military and civilian coalition are clearly in charge in Indonesia and are likely to remain so, at least for the next year or two. Although Sukarno’s influence is declining steadily, he is still a major preoccupation of the regime, an obstruction in its daily work, and a source of political embarrassment. During 1967, however, he will probably be stripped of all effective political power, retaining at most the ability to offer occasional encouragement to frustrated leftist elements.2
B.
With the Communist Party already destroyed as an effective force in today’s politics, the neutralization of Sukarno would greatly improve the outlook for political stability in Indonesia. Nevertheless, there will still be major problems of adjustment. Civilian politicians will be in conflict with military leaders reluctant to share power. And the mass parties of the Sukarno era will have to compete for influence with resurgent and reformist political elements closer to Suharto’s “new order.”
C.
The Indonesian economy cannot quickly recover from a decade and more of ruinous mismanagement, but it is probable that economic conditions will at least cease to deteriorate and begin to improve within a year or two. If foreign assistance continues at high levels and government administration becomes more effective, an economic upturn could probably be sustained until 1970. The need for foreign economic assistance—which can only be expected to come from the US, Japan, and Western Europe—virtually assures continuation of Indonesia’s new Western-leaning foreign policies.

[Here follows the Discussion section of the estimate.]

  1. Source: Department of State, INR/EAP Files: Lot 90 D 165, NIE 55–67. Secret; Controlled Dissem. The Central Intelligence Agency and the intelligence organizations of the Departments of State and Defense, and the NSA prepared this estimate, which was concurred with by all members of the U.S. Intelligence Board except the representatives of the AEC and FBI who abstained because the topic was outside their jurisdiction. In a memorandum to Rusk summarizing this estimate, Hughes indicated that there was wide agreement among the USIB members with its conclusions. (Memorandum from Hughes to Rusk, February 24; ibid.)↩
  2. In Intelligence Memorandum No. 0794/67, February 17, “Prospects for Violence in Indonesia,” the CIA’s Office of Current Intelligence, Office of National Estimates, and the Clandestine Services concluded that, “Isolated armed incidents by pro-Sukarno elements are likely if Sukarno refused to resign and was deposed by congressional action.” The principal areas for opposition would be East Java where Sukarno still had support among the marines, police, and the general population, and possibly Central Java, North Sumatra and even Djakarta. Long-term dissidence was unlikely. (Johnson Library, National Security File, Country File, Indonesia, Vol. VII, Memos, 5/66–6/67) Ropa asked that the CIA send this assessment to the White House and he passed it to Rostow under cover of a February 17 memorandum. (Ibid.)↩