Garuda Indonesia: A democratic success story

Originally published by Asian Correspondent.

IN September, Indonesia’s state-run carrier Garuda Indonesia announced it would be expanding into the U.S. market with flights to begin in 2017.

According to its spokesperson Benny S. Butarbutar, this is part of the airline’s strategic plan “to strengthen Garuda Indonesia’s position as a global aviation player.”

Further towards this aim, it has since signed a codeshare agreement with Mexico’s national carrier Aeromexico whereby passengers can fly from Bali to destinations like Acapulco, Monterrey and Cancun.

Indeed, the airline certainly is a major player across the Asia-Pacific and increasingly worldwide.

This year, Garuda Indonesia was declared the world’s ‘most-loved’ airline, with the highest satisfaction rating among more than 420 carriers worldwide. In 2015, it was presented a Five Star Airline award by Skytrax, joining only six other airlines awarded this honour. This year, it was also deemed to have the World’s Best Airline Cabin Crew for a third consecutive year.

Source: Garuda Indonesia.

Indeed, it has not always been this way.

The announcement of Garuda Indonesia’s expansion into the US market only came after the American civil aviation authorities in August lifted a longstanding ban on Indonesian airlines flying there. Indonesian airlines are still recovering from decades of being reputed internationally as terribly unsafe. Under former dictator Suharto, Garuda was considered one of the world’s worst airlines.

Safety standards were extremely poor, with all-too-regular crashes and even cases of pilots attempting to land at the wrong airport. The legacy of this has taken years to eradicate.

The Garuda Indonesia crash in 2007. Source: Garuda Indonesia.

Even as recently as 2007, a Garuda Indonesia flight landing in Yogyakarta overshot the runway and burst into flames, killing 21 passengers and a crew member. As a result, all 51 Indonesian airlines were banned from flying in the European Union. The ban on Garuda Indonesia was later lifted in 2009 and flights resumed to Europe.

While western countries are enthusiastically selling off their flag carriers, leading to reduced quality of service and safety standards, a handful of Southeast Asia’s state-owned national airlines such as in Thailand, Singapore and Vietnam remain amongst the world’s best. Garuda Indonesia is no exception.

Importantly, Garuda’s transformation from a dangerous, unreliable airline to the world’s ‘most-loved’ has come during the era of democracy since 1998.

Indonesia’s national carrier has since its inception been tied to the young nation’s identity and political history.

In fact, its first plane was one seized from the Dutch colonialists during the 1945 revolution. By 1949, a commercial plane branding “Garuda Indonesian Airways” flew the nation’s first president and revolutionary hero, Sukarno, from Jakarta to Yogyakarta.

Indeed, Bung Karno himself drew the airline’s name from a contemporary poem by Noto Soeroto, “I am Garuda, Vishnoe’s bird which spread its wing high above your archipelago.”

The garuda is a holy bird in Hindu and Buddhist mythology. The fact that this was chosen as the symbol of the national carrier for the world’s largest Muslim country is not insignificant. It represents a powerful acknowledgement of Indonesia’s rich history and its democratic mantra of ‘unity in diversity’ as enshrined under the official Pancasila state ideology.

The Suharto era, a brutal military dictatorship ushered in by a failed coup and retributive killings of some 500,000 communist sympathisers, was characterised by hyper-concentrated state power, corporatism and a system of patronage driven by rampant corruption. High-level official positions and business opportunities were monopolised by the Suharto’s friends and family. With nepotistic bureaucracy and poor administration, Indonesia’s national carrier suffered.

After the Asian economic crisis of 1997, Suharto fell from power following a period of instability and a push for democracy from student organisations and civil society. Indonesia then began its (to date highly successful) transition to democracy. Political and economic freedom has since made Indonesia significantly more prosperous.

Garuda Indonesia, along with other Indonesian state-owned enterprises, now has more effective corporate governance than many actors in the private sector. It has benefitted greatly from strong leadership based upon merit rather than nepotistic appointments as under the New Order regime. Whilst increasingly privatised, Indonesia’s government retains majority ownership of the airline. Last year, Garuda Indonesia moved 23 and a half million people, more than the entire population of Australia. After years of losses, it turned a profit in 2015 and continues to restructure to cut costs and increase revenue whilst expanding into Europe and North America.

The current president, Joko Widodo, has pushed massive investment in the country’s ailing infrastructure – particularly in long-neglected regional areas. Just this month, Jokowi has inaugurated two new airports in remote areas of West Sulawesi and Riau. Given that Garuda accounted for almost half of all domestic flights in Indonesia during 2015, it naturally stands to benefit.

Despite some early hiccups, the newly-christened Terminal 3 at Sukarno-Hatta International airport is the impressive centerpiece of Jokowi’s infrastructure vision. It is also a shiny, modern temple of Indonesian nationalism – with tasteful contemporary art and displays of national heroes, including a portrait of Bung Karno and Mohammad Hatta after whom the airport is named.

Garuda Indonesia currently has exclusive use of the terminal for domestic flights. Indonesia’s transport minister Budi Karya Sumadi declared that “this terminal was built to change the image of the capital Jakarta.” Given its grandeur and nationalist flavour, this is probably true for the entire nation.

Indonesian entrepreneur John Riady once said that despite its enormous population, economy and regional influence, Indonesia is “probably the most invisible country in the world”.

The global ascendency of Garuda Indonesia, however, will undoubtedly help to change this.

 

 

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