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Blast another setback for Indonesia

By Joe Havely

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(CNN) -- Until just a few years ago Indonesia was seen as a relatively peaceful and increasingly prosperous country -- one of a pack of Southeast Asian "tiger" economies set to dominate the much-anticipated Pacific century.

The first hammer blows came with the Asian financial crisis of 1997, the collapse of the Indonesian economy and the political instability resulting from the collapse of the authoritarian Suharto regime.

Then came last October's Bali bombings killing more than 200 people -- most of them young overseas tourists packed into nightclubs in the popular resort town of Kuta.

That was followed by smaller bomb attacks on the Jakarta stock exchange, at the country's main international airport and outside the country's parliament.

And now a deadly car bomb outside a top Jakarta business hotel, apparently targeting expatriates and timed to cause maximum casualties.

All of this has left Indonesia's once shining image badly shaken and tarnished its reputation.

Tourists who once flocked to the country's palm-fringed beaches and world-class cultural relics have stayed away, heading instead for what they see as safer destinations.

And despite intensive government efforts to persuade them otherwise, many businesses are finding Indonesia simply too risky to invest in.

With Indonesia wracked by unrest following the 1997 financial meltdown and the fall of President Suharto, international concern has focused on the rise of radical Islamic groups, including the shadowy al Qaeda-linked Jemaah Islamiyah (JI).


JI has said it wants to carve out a pan-Islamic super-state in South-East Asia, pushing out all foreign influences from the region.

In Indonesia, once known for its moderate brand of Islam, groups like JI have been blamed for fostering pockets of small but violent militants bent on forcibly transforming the country into a fundamentalist Islamic state.

Outside funding from groups such as Osama bin Laden's al Qaeda network has raised fears that following the collapse of the Taliban in Afghanistan, militant Islamic groups have now turned their attention to Indonesia.

Such groups had fed upon mounting disaffection as Indonesia's continued economic woes force thousands out of work.

On top of that intelligence officials say bin Laden has franchised his brand of terrorism, offering militant Muslim groups such as JI support on condition they merge their goals with his anti-Western agenda.

Although the government has promised to root out militant Islam and prevent Indonesia becoming a hotbed of international terrorism, deep divisions within the coalition of President Megawati Sukarnoputri have stifled the effectiveness of police action.

The investigation into the Bali bombings was widely praised by outside experts for its transparency and success in rounding up many of the key suspects.

But although more than 30 arrests were made in connection with that attack, subsequent investigations have unearthed a militant network more deeply entrenched, more determined and better armed than initially thought.

Little more than a week before the Marriott blast, a police raid on the Indonesian island of Sulawesi uncovered a stash of homemade bombs.

It was the third such discovery in the space of just two weeks.

Indonesia's own war on terrorism, it seems, may be only just beginning.

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