Which Indonesian companies are successful overseas

In the clan house around the world

After 88 years, his lifelong odyssey finally took him to Singapore. From there, Liem Sioe Liong now watches over the remains of a group of companies that was once one of the largest in Indonesia. He is still one of the richest men in Asia - no one knows exactly how rich. In 1994, his personal fortune was estimated at $ 4.8 billion; in 2000, Forbes estimated it to be $ 1 billion. His reticence has made him a mythical figure. He's something like the Howard Hawks of Asia.

In 1990, Liem's ​​internationally operating Salim group had sales of around eight billion US dollars. Salim's domestic business alone accounted for around five percent of Indonesia's gross domestic product. 135,000 employees worked for the group, which united more than 300 companies under one roof. Liem was number one in Indonesian banking, dominated the cement and noodle markets, held large stakes in auto production, and played a central role in petrochemicals, baby food and real estate. In terms of sales, the Salim Group outperformed the other large Indonesian corporations by around three times. But Liem's ​​fate was inextricably linked with that of the Indonesian dictator Suharto. When his career came to an end in 1998, the time had come for Liem too.

Economically successful, culturally isolated

Liem was born in the southern Chinese province of Fujian. However, poverty and lack of prospects drove him out of his home early on. In 1937 the wandering have-nots finally ended up in central Java. There he was initially a small trader and sold peanuts, cloves and bicycle parts. But in the forties he began to do business with the new nationalist-revolutionary armed forces. A few years later he was promoted to an important supplier of the Diponegoro division. The officer responsible for the troop equipment in the prestigious unit was the lieutenant - and later general - Suharto.

Suharto got on well with the humble Fujian man. When the "father of development" came to power in Indonesia in 1965, Liem began a rapid ascent. The dictator also helped other entrepreneurs of Chinese descent on their way. But while relying financially on a layer of big businessmen of Chinese origin, Suharto did everything possible to curb the cultural otherness of the Chinese community: his government urged immigrants to adopt Indonesian names, closed their schools, and banned the use of their language and script in public .

These contradicting policies had a long tradition in the region. "The overseas Chinese played an important role for a number of governments," says Leo Douw, professor of modern Chinese history and society at the University of Amsterdam. “They formed a class of business people who were both efficient and reliable and culturally isolated. That made them vulnerable and therefore harmless to those in power. ”In Indonesia, before Suharto, the Dutch had already seen it that way, as had the Spaniards in the Philippines and the monarchs of Thailand in their own country. With this attitude, the respective rulers contributed to the business success of the Chinese in the regions. But this success came at a high price: if their real or supposed influence grew too much, it became dangerous. Until recently, pogroms were not uncommon, as was the state repression of Chinese culture and way of life.

Despite these terrible reports, the Chinese were drawn out of their homeland again and again. While the early emigrants in the 18th and 19th centuries were primarily daring traders looking for new markets and goods, later generations were driven out of the country by civil wars, the fall of the German Empire, the chaos of the first years of the republic, overpopulation and famine. Whatever the reasons for the exodus, however, the Chinese exiles proved to be extremely successful in their new home countries. In Indonesia, around 80 percent of the 200 largest companies are still controlled by Chinese immigrants or their descendants. In almost all other countries in Southeast Asia, they play a similarly central role in business life. Many of the poor emigrants or their children made it to the middle class, some even to the upper class. How did you do that?

Trade and commerce have a long tradition in China. In much of Southeast Asia, however, these were fairly new ideas. So the competitive situation for the newcomers was quite favorable. The central starting advantage, however, turned out to be the organization in widely ramified clan networks, which has long been the norm in southern China. Wherever the emigrants went: the clan was already there. In the clan houses, the newcomers found start-up help, access to credit and market information. Local and regional trade relationships could be established there, which as a rule far exceeded the radius of non-Chinese competition.

The organization of emigration also contributed to the success. In the first decades of the 20th century - one of the high phases of Chinese emigration - the budding emigrant usually borrowed the travel money from an "old guest", the Chinese expression for members of an earlier generation of emigrants. Some of them regularly commuted between the port cities of Southeast Asia and their home areas in China. There they recruited “new guests”. The newcomers traveled on small sampans along the southern Chinese coast to one of the major ports, especially Xiamen, Shantou and Hong Kong.

You stayed to yourself. If the new guest was a member of the Hakka, an ethnic group in southern China, he was traveling in the wake of a Hakka recruiter. As long as he waited for the crossing, he stayed at a hostel that specialized in Hakka. This not only had the advantage that he could use his mother tongue there - the numerous South Chinese dialects often differ from one another as much as the European languages ​​of a linguistic family. There were also dishes from the local cuisine, not unimportant in a country whose residents generally consider something other than the food of their home region to be barely edible. But it was also beneficial for the emigrant to stay among compatriots because there he was not exposed to the hostilities of other Chinese ethnic groups. A bitter war between Hakka and Punti-Guangzhouese, for example, was the decisive motive for an entire generation of emigrants to leave their homeland.

When the ship finally set sail, the recruiter accompanied his clients to their destination. There he delivered them to their new employer or took them to the relatives who sent for them. The newcomers were quickly integrated into the appropriate clan houses in the target countries. Such clan organizations had long played a central role in southern China. Guangdong and Fujian, the home provinces of almost all overseas Chinese, are a long way from the capital. At these fringes of the empire, the state authority usually did not extend to the village level, but silted up somewhere in the vicinity of the district towns. It was the clan houses, or huiguan, that filled this void. Nothing went on in the villages without the powerful families, and on the lower administrative levels even the imperial officials could not do without their support.

The relationships within the clans were often fictitious. With a family made up of children, parents and grandparents, these groups did not have much in common. So there were entire villages that got by with one family name - with this, the residents sealed their relationship of dependency on the most powerful clan. The reputation of the individual clan houses depended largely on their ancestral line. Ancestor worship is a central element of Chinese religiosity. Because of this, the clans tried to trace their ancestry back to a brilliant hero in Chinese history. For example, most Li families claim to be related to the founder of the Tang dynasty, who in turn traced his line of ancestry back to Li Er - Laotse.

With such a Daxing, a big name, it was better not to mess with unless you yourself had an organization of comparable social and economic strength behind you. Then there could be a bloody feud. The most powerful groups were able to raise powerful private armies, and in this case such a vendetta could take on the proportions of civil war.

Not all clans had such power at their disposal. But even the less influential ones were tightly run organizations. However, the hierarchies did not give every member good opportunities for advancement. So many young men had no choice but to go away and earn a living in distant cities.

They didn't necessarily have to be in China. Time and again, individual fortune seekers had ended up in Nanyang, Southeast Asia. But it was only when order collapsed in the empire in the 19th century that it became a mass movement: the southern Chinese migrants no longer moved to the north or inland; instead, tens of thousands of them went to Nanyang. The clan structures finally promised a soft landing everywhere.

In addition to family relationships, whether real or fictional, the place of origin was decisive for the clan's identity. In order to ensure this solidarity for the next generation as well, the emigrants sent their children back to China for upbringing - if they could afford it. In the best case scenario, the son found a bride in his old hometown, Qiaoxiang, right away. This happened to my grandfather Lai Tjin Tong. He was born in 1914 in what was then Batavia, now Jakarta. Shortly after his sixth birthday, his parents sent him to their Qiaoxiang near Meixian and placed him in the care of the family organization. He did not return to Jakarta until twelve years later. There he married his fiancée whom he had brought from Meixian.

Lai's patriotic feelings for China were strong. Like many of his compatriots, he had been convinced since the 1950s that the communists in Beijing had finally found a way to reverse the decade-long decline of China. He was full of enthusiasm for the new government. In his Jakarta neighborhood, he stood out for listening to the People's Republican radio stations as loud as possible. When Indonesia was shaken by anti-communist and anti-Chinese pogroms in the mid-1960s, it made sense for him to move to China. In 1967 he finally moved back to Meixian.

The right business at the right time

The timing was miserable because the Cultural Revolution was already in full swing. The returning overseas Chinese were under general suspicion of being capitalist spies, and at that time suspicion was equal to guilt. In 1970 he managed to leave for Hong Kong. Fortunately for him, before moving to China, he had left part of his savings with relatives in Jakarta - what he had taken with him to China had been expropriated. With the money from Jakarta, he set up a regular taxi company in Hong Kong, and a laundry was added a little later.

The laundry was the right company at the right time: in the late 1970s, Guangdong Province in Hong Kong's hinterland began to rise to become one of the world's largest centers for labor-intensive light industries. Above all, clothing was produced there in large quantities, and all the branded jeans and shirts had to be washed somewhere before they could be sent to the stores. At the same time, however, it began to appear that Hong Kong would become part of the People's Republic in the not too distant future. Lai no longer trusted the Beijingers and moved to Singapore. He felt a stranger there, so he moved back to Hong Kong in 1981. Fourteen years later he died in Jakarta. After his funeral in the Indonesian capital, his sons set up a shrine to worship the Patriarch in Meixian. The city in Guangdong was still considered the place of origin of the family, although their father was born in Jakarta and they lived in Hong Kong themselves.

In addition to family networks, there were other networks that made it easier for Chinese overseas to gain a foothold in their new home countries. Trade guilds were still developing in the 19th century, which were also often subdivided according to name and place of birth. Then chambers of commerce and trade unions were added, supplemented by secret organizations or “triads”, sometimes political, sometimes religious, sometimes criminal. As before in southern China, patriarchal umbrella organizations slowly emerged from the alliances of the most influential associations. Among the overseas Chinese, these meta-huiguan took on many social and political functions: They were responsible for economic contacts, welfare services, social control and the upkeep of Chinese schools. They also mediated between the Chinese community and the local authorities.

"The Jews of the Orient"

The colonial governments had already done their best to promote the high level of Chinese self-government. It had been a perfect fit with their indirect domination strategy. This also included targeted promotion of segregation. The “Kapitan” system, according to which the various communities elected a leader or Kapitan from their ranks, who was accountable to the colonial administration, became the model in the region. With a small puzzle of halfway self-governing units was easier to deal with, according to the concept of the colonial powers, than with a large block of subjects under direct colonial rule. The Dutch had forbidden the Chinese minority to acquire land in Indonesia. By keeping financially strong competition out of the profitable business with the plantations in this way, they promoted the Chinese presence in trade and commerce. After the end of the colonial era, the new states tightened this policy of discrimination. For a long time it was the case for the Southeast Asian Chinese that political careers were out of the question, academic careers were not allowed, Chinese land ownership remained undesirable and access to state-certified professions such as doctor, teacher or lawyer was made difficult or even completely denied. So the Chinese had no choice but to focus all their attention on business.

The awakening nationalism in the countries of Southeast Asia made the 20th century a bumpy road in the history of the overseas Chinese. Even in Thailand, where the coexistence between locals and immigrants had been particularly harmonious for a long time and the Chinese were often not regarded as foreigners at all, they were now exposed to severe hostility. At the beginning of the 20th century, King Rama VI published numerous anti-Chinese pamphlets from Siam, in which he was inspired by traditional European resentments: In “The Jews of the Orient” he accused the Chinese in the diaspora of showing no loyalty to their new home countries. Just as in Europe anti-Semites considered the Jews to be the originators of capitalism, modernity and moral decline, in Asia the Chinese immigrants were now exposed to the vague suspicion of being somehow harmful to the young nation-states.

After Suharto banned Chinese organizations in Indonesia in the mid-1960s, he relaxed his strict assimilation policy a little in the following decade. At least under the guise of a religious orientation, Chinese organizations have now been able to re-establish themselves. The huiguans had evolved anyway. By the 1980s, some of them had finally grown into gigantic, global hometown clubs. Around 1991, more than 1000 delegates gathered for the International Teochew Convention in Paris.

The rulers in Beijing now also began to be interested in these organizations. In 1997 they allowed the now 4,000 delegates of the Chaozhou Convention to meet in Shantou in southern China, once one of the major emigration ports. In the past 20 years, more than 100 such large-scale events by international clans have taken place, and the trend is growing rapidly. Prominent large Chinese entrepreneurs organize and support the gatherings. The membership list of the International Association of Fuzhou Corporation reads like a who’s who of the Southeast Asian business community. One of the most prominent members of the association is the Hong Kong real estate and media magnate Robert Kuok, one of the most influential businessmen in the region with exquisite relations with the Beijing government.

And so the circle is slowly coming full circle. The central government is setting out to tap the resources of the diaspora. It was no accident that Beijing established the special economic zones in Guangdong and Fujian. Most of the overseas Chinese or Huaqiao come from the two southern provinces. For Huaqiao business people, the path to the Chinese market usually leads through contacts in the place of origin of their family. The new Chinese capitalism was able to benefit from the money, the experience and the dynamism of the successful expatriates.

America is more tempting today

The flow of emigration to Southeast Asia has almost dried up at the moment. The constantly changing situation in China and in the destination countries leads to new patterns of emigration. More recently, emigrants have been drawn to Australia, America and, to a lesser extent, Europe. Countries like Indonesia are not very tempting from China at the moment. When Suharto's dictatorship came to an end in 1998, his overthrow was accompanied by violent pogroms against the Chinese in Jakarta. Relations between the Chinese and Indonesians have relaxed since then, and in recent years there has been a small renaissance of Indonesian-Chinese culture, especially in Jakarta. But for many, 1998 was full.

At that time the house of Liem Sioe Liong, Indonesia's richest man and Suharto's dearest confidante, fell victim to looters. It was in a humble neighborhood. Liem had bought it before its success began. He considered the house to be his good luck charm. The shock was all the greater when he saw it burn. But the situation did not last long. As an experienced migrant, Liem knew it was high time to move on.