BOGOR, Indonesia—A prominent but polarizing Suharto-era general running for president is pushing for a more-relaxed dose of Indonesia's economic nationalism, following the rollout of laws to pressure mining companies to invest in building refining capacity.

Prabowo Subianto said that he strongly believes the Southeast Asian country, with about 240 million people, needs to keep more of the money earned from raw materials by processing them at home. That would help overcome poverty, he said, but compromise is needed.

"I'm considered a strong economic nationalist, but I'm also a realist," Mr. Subianto said in an interview Wednesday, as the country readies for elections that will lead to the first change in leadership in a decade. "It should not be done in a way that backfires on you. The goal is improved prosperity."

Such goals have fueled policy in Japan, India, Europe and elsewhere. But Indonesia, with its history of corruption and mistrust of foreigners, has earned a reputation as a minefield for investors caught on the wrong side of changing laws, murky ownership and uncertain enforcement of contracts.

President Susilo Bambang Yudhoyono's team eased regulations in his first five-year term, but took a harder line in the second. In January, the government banned the export of raw mineral ores and raised taxes on some concentrates to force mining companies to spend billions of dollars to build refining capacity and keep that lucrative work here.

Indonesia is a major source of commodities such as nickel ore, bauxite, tin, copper and thermal coal.

Following an outcry from local mining companies and international giants such as Freeport-McMoRan FCX -4.85% and Newmont Mining Corp. NEM -1.32% that the plans were economically unfeasible and would lead to job losses, officials said Sunday that Indonesia may reduce export duties case by case for companies serious about refining here.

Mr. Subianto agreed that Indonesia must tap more of the wealth its resources create. "We have this burgeoning population; what are they going to do?" he said. "They have to be productive.'"

However, the law may have been implemented too quickly and there should have been more consideration of the interests of foreign partners, he said.

"They invested money here years ago when nobody wanted to come in. There should not be shocks" that make it difficult to do business, Mr. Subianto said. "The consequence now is that there could be hundreds of thousands of people out of jobs."

Mr. Subianto, 62 years old, has a directness contrasting with the soft-spoken Javanese tradition and appeals to some Indonesians desiring decisive leadership. But he is distrusted by others for his role as a general leading the Special Forces in the authoritarian era of the late President Suharto, who was his father-in-law.

The regime collapsed in street riots fueled by the Asian financial crisis in 1998. The U.S. has blacklisted Mr. Subianto from obtaining a visa in connection with the abduction of dissidents; he has denied the allegations. U.S. Ambassador Robert O. Blake says that Washington will work with whoever is elected leader.

Mr. Subianto lost a vice presidential bid in 2009 and has worked to strengthen his Great Indonesia Movement Party, giving speeches across the archipelago.

Winning the presidency is complicated. Indonesia holds legislative elections April 9. Only groupings that win 25% of the national vote or 20% of the 560 seats in the House of Representatives can field presidential candidates. Few parties hit that threshold, so intense negotiations follow the vote to build alliances. The presidential vote comes July 9 and goes two rounds if there is no majority winner.

—Anita Rachman and Andreas Ismar contributed to this article.

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http://blogs.wsj.com/searealtime/2014/03/07/eggs-and-napoleon-with-prabowo/

  • March 7, 2014, 5:51 PM

Eggs and Napoleon with Prabowo

 

  • By Patrick McDowell

Prabowo Subianto views himself as a pragmatist. If he sets a breakfast meeting at his ranch in the highlands overlooking Jakarta, he flies in guests by helicopter to avoid the day-long traffic jam circling the city.

Agence France-Presse/Getty Images
Presidential candidate Prabowo Subianto, a former military commander, joins hands with supporters during a forum in Jakarta on Jul. 15.

The former Special Forces general and current presidential contender checks out visitors in a pavilion a few meters from the helipad. In local tradition, they're invited into the main house only if they pass muster.

Inside, pictures of Prabowo in his Suharto-era military uniform vie with views overlooking his expansive hilly acreage. He loves animals; the stray mutt rescued by his staff and now ruler of the roost growls through the window in a territorial throw-down at the white-headed sea hawk perched outside.

He makes sure the batik-shirted staff gets the eggs right – "Scrambled? Sunny side up?" – and regrets the loss  of muscle mass after 55 (watch the carbs, eat protein; he's 62). Admitting he's a clear member of the elite 1%, he weighs in on how domestic control of economic resources and modern agriculture could uplift the half of the country he says has been left behind by the recent economic boom.

But Prabowo is, at heart, a military man, even if his career ended abruptly in 1998 after unrest ended the long rule of his former father-in-law, Suharto, and put him on a U.S. visa blacklist for alleged human-rights abuses, which he denies. His view of the world is shaped by a passion for history, strategy and tactics. He'll quote Napoleon ("An army marches on its stomach") to support his agriculture policy and paraphrase Goebbels ("If you tell a lie big enough and keep repeating it, people will eventually come to believe it'') to dismiss his critics.

His library overflows with volumes on military history. He's now brushing up on his economics – though still angled on the sweep of events: "The Commanding Heights" and its Great Man subject, Keynes, and a dog-eared copy of Niall Ferguson's "The Great Degeneration."

A few observations he shared during a recent breakfast: