The Reformasi period 1998 to 2004, including Habibie's openings, the 1999 election, the Wahid and Megawati presidencies, constitutional amendments, decentralisation, and the limits of democratisation

What this dot point is asking

NESA expects you to explain how Indonesia moved from a 32-year authoritarian regime to a competitive electoral democracy between 1998 and 2004, the constitutional and institutional changes that made this possible, the failures and limits, and the way in which three Reformasi presidents (Habibie, Wahid, Megawati) prepared the ground for direct presidential elections in 2004. Strong answers integrate political reform, decentralisation, and human rights legacy issues.

The answer

Habibie's openings, 1998 to 1999

B.J. Habibie, sworn in on 21 May 1998, was widely expected to be a transitional figure. He surprised both Indonesians and observers by moving rapidly. The Habibie government in 17 months delivered five irreversible reforms.

Press freedom: Information Minister Yunus Yosfiah revoked the New Order press licensing system (SIUPP) on 5 June 1998 and lifted the ban on Indonesia's Journalists Alliance (AJI). The press flowered overnight; new dailies, magazines, and television stations multiplied.

Political parties: A new political parties law (UU 2/1999) ended the three-party restriction. Forty-eight parties registered for the 1999 election.

Political prisoners: Hundreds of New Order political prisoners were released, including PKB writer Pramoedya Ananta Toer and Megawati's PDI-P faction.

The East Timor referendum: Announced on 27 January 1999 and held on 30 August 1999 (see separate dot point).

A new general election: Held on 7 June 1999, the first competitive election since 1955. PDI-P (Megawati's faction) won 33.7 per cent. GOLKAR survived at 22.4 per cent. PKB (Wahid) took 12.6 per cent; PPP 10.7 per cent. Turnout was 93.3 per cent.

Habibie himself stood for re-election by the MPR on 19 October 1999. He delivered an accountability speech that the MPR rejected by 355 to 322. Habibie withdrew his candidacy. The election cycle worked.

The Wahid presidency, October 1999 to July 2001

The MPR, in which PDI-P was the largest single bloc but lacked a majority, elected Abdurrahman Wahid ("Gus Dur") of PKB as the fourth President of Indonesia on 20 October 1999. Megawati Sukarnoputri was elected Vice-President the next day after PDI-P street protests.

Wahid, a near-blind cleric of the Nahdlatul Ulama tradition and a long-time pro-democracy figure, accelerated reform. He abolished the Departments of Information and Social Affairs (1999); rescinded the New Order ban on the public expression of Chinese culture and the use of Mandarin (Keppres 6/2000); apologised to victims of 1965; restored diplomatic relations with Israel commercially; relaxed restrictions on Papua, allowing the Morning Star flag to be raised.

He also tried to remove conservative generals (sacking General Wiranto from his cabinet in February 2000) and reduce the army's political role. His erratic style and accusations of corruption (the "Bulogate" and "Bruneigate" scandals, the former involving an unauthorised use of $4 million from the state grain agency) eroded his coalition.

On 1 February 2001 the DPR passed a first censure (memorandum). On 23 July 2001 the MPR voted to impeach Wahid by 591 to 0 (PKB walked out). Wahid issued a midnight decree dissolving the MPR; the military and police refused to enforce it. Megawati was sworn in as fifth President later that day.

The Megawati presidency, July 2001 to October 2004

Megawati Sukarnoputri (daughter of Sukarno) inherited a stabilising economy and a tense post-Wahid coalition. Her presidency was institutionally consequential despite a reputation for political passivity.

Two of the four constitutional amendments fell in her term. The third amendment (November 2001) restructured the MPR, abolished the seat reservations for "functional groups," and introduced direct presidential election. The fourth amendment (August 2002) abolished the reserved TNI seats in the DPR (effective from 2004), created the Constitutional Court (operational 2003), and constitutionalised regional autonomy.

The first and second amendments (October 1999, August 2000) had already limited presidential terms (two five-year terms), strengthened the DPR's lawmaking role, and entrenched human rights provisions.

The Constitutional Court (Mahkamah Konstitusi), inaugurated on 13 August 2003, took jurisdiction over judicial review of laws against the constitution and over electoral disputes. Its first chief justice, Jimly Asshiddiqie, established it as the most independent court in the system.

Decentralisation

The Habibie laws UU 22/1999 (regional autonomy) and UU 25/1999 (fiscal balance) came into force on 1 January 2001 under Wahid and were elaborated under Megawati's UU 32/2004. The reforms devolved authority and around 30 per cent of revenue to over 400 kabupaten (regencies) and kota (cities), bypassing the provinces.

The decentralisation was politically essential. It bound the resource-rich Outer Islands (Aceh, Riau, East Kalimantan, Papua) to the Republic by guaranteeing them shares of oil, gas, and forestry revenues. It also produced a proliferation of new regencies (over 100 created in the first decade), localised corruption, and the development of regional "money politics."

Special autonomy laws followed for Papua (UU 21/2001) and Aceh (UU 18/2001). Both promised 70 per cent of resource revenue and significant cultural and judicial autonomy. Implementation was patchy.

Communal conflicts

Reformasi unfolded alongside several major communal conflicts. The Ambon (Maluku) Christian-Muslim conflict from January 1999 killed around 5,000. The Poso (Central Sulawesi) Christian-Muslim violence from 1998 to 2007 killed around 1,000. The Dayak-Madurese violence in West Kalimantan (1999 to 2001) killed around 500. Together with Aceh and Papua, around 1.4 million Indonesians were internally displaced at the peak in 2001.

Laskar Jihad (formed 2000) and Jemaah Islamiyah used the communal conflicts to recruit and train. The 2002 Bali bombing was the eventual external expression.

TNI reform

The army's institutional structure was changed. The TNI and POLRI were separated (April 1999), ending the army's command over the national police. The TNI was withdrawn from politics on paper (dwifungsi was formally abolished in 2000), although territorial command structures (KODAM to KORAMIL) were preserved.

Reserved military seats in the DPR were progressively reduced from 75 (1999) to 38 (1999 election) to abolished (effective from the 2004 election). Active military officers were barred from civilian appointments.

Timeline

Historiography

Edward Aspinall (Opposing Suharto, 2005; Democracy for Sale, 2019) is the standard scholar of the period. He treats Reformasi as a "pacted transition" in which the army-civilian elite negotiated reform terms that protected past elites from accountability.

R. William Liddle and Saiful Mujani ("Indonesia in 2004," Asian Survey 2005) provide the canonical contemporary account of the institutional consolidation.

Marcus Mietzner (Money, Power, and Ideology, 2013) treats Indonesian democracy as resilient because patronage networks rebuilt themselves within the new institutions.

Adrian Vickers (A History of Modern Indonesia, 2013) is the textbook narrative. He emphasises the contrast between political opening and persistent communal violence.

Vedi Hadiz (Localising Power in Post-Authoritarian Indonesia, 2010) argues that decentralisation entrenched local oligarchs rather than empowering ordinary citizens.

How to read a source on this topic

First, distinguish formal reform from substantive change. The four constitutional amendments are decisive on paper: direct presidential election, an independent court, devolved authority, abolition of TNI seats. The substantive effect was more limited: New Order figures (Akbar Tanjung, the Cendana family) returned to power within the new institutions.

Second, weigh the role of Megawati. She is often characterised as passive, but the third and fourth amendments and the Constitutional Court all date to her term.

Third, note what was not addressed. No trials for 1965 to 1966; no trials for the May 1998 killings or Trisakti shootings; no trial of Suharto (he was deemed too ill in 2000); limited prosecution for East Timor.

Common exam traps

Treating Reformasi as a single moment. It runs from 21 May 1998 through 20 October 2004, six years and three presidencies.

Misdating the constitutional amendments. Four amendments: October 1999, August 2000, November 2001, August 2002. The 2002 amendment created direct presidential elections.

Confusing PKB and PDI-P. PKB is Wahid's Islamic-pluralist party rooted in NU. PDI-P is Megawati's nationalist party rooted in PNI.

Forgetting Habibie's role. The most important Reformasi president for institutional opening was Habibie, who served 17 months and is often skipped over.

In one sentence

Reformasi from 1998 to 2004, opened by Habibie's press, party, and East Timor reforms, structured by four constitutional amendments under Wahid and Megawati that abolished TNI seats, introduced direct presidential elections, created a Constitutional Court, and devolved authority to over 400 regencies, and consolidated by free elections in 1999 and 2004, transformed Indonesia from a personalist authoritarian regime into the world's third-largest democracy while leaving large legacies of impunity unaddressed.