Indonesia Riots Spreading

The military also held a weekend exercise in Jakarta involving 25,000 troops to show its strength in an attempt to restrain political unrest. But on Tuesday, hundreds of people took to the streets in Jakarta for a peaceful protest against rising prices and unemployment. Security officials tried to reassure the population while residents rushed to stores to buy staples after rumors of price increases.

With reports also circulating of new closings of factories, hundreds of people marched through Jakarta's business district chanting, "Hungry, hungry."

The protest stopped outside the nation's Central Bank and waved rupiah notes and U.S. dollars. The rupiah has dropped 80 percent against the dollar in the last seven months.

Other protests were reported over the weekend on the islands of Java and Sulawesi.

On Sunday, 21 Chinese stores in Ende were burned and many Chinese took refuge in the local military police station. The rioters were out again on Monday, attacking Chinese stores and homes before officials sent hundreds of troops to patrol the streets. Mobs threw Molotov cocktails, stones, burned tires and shouted disparaging remarks about the Chinese.

Indonesian security forces have been making a strong show of force in Jakarta the last three days and have warned that violent protests will be put down harshly.

The government also issued a warning to the media on how to report protests.

"When it comes to riots, for example, the media must be able to describe the situation or background, what caused the rampage," Ideology Board official Alwi Dahlan told the Jakarta Post. "Otherwide the news will be misleading."

Dahlan said the media should help the government maintain order. He also defensded the security forces for refusing to give out information on riots.

Troops are out in force throughout the country and will remain visible, especially in the capital. The last thing the country wants is to scare away foreign companies that do business in Jakarta. In an attempt to reassure expatriates in Jakarta, Major General Sjafrie Syamsuddin said in an interview with the official Antara news agency, "I assure all foreigners living in Jakarta not to worry about their safety."

The government also moved to ward off a blow to the nation's health system on Monday, saying it would allocate $104 million to subsidize dwindling supplies of medicine which have gone up four to five times.

"This problem must be overcome because it can trigger public unrest," Health Minister Suyudi said in making the subsidy announcement.

"I am afraid there will be bloodshed," he was quoted by the Sydney Morning Herald during a debate on Monday at a Jakarta mosque. "For me there are certain political constraints. Since yesterday I have been followed everywhere by police."

Amien Rais, who heads the 28-million member Muhammadiyah group, compared Indonesia to the ocean liner Titanic, sinking under the weight of the rupiah turmoil and a debt crisis, according to the Voice of America. Rais said the Indonesia's elite is "still drinking, playing cards and gambling while the ship goes down."

Meanwhile, respected Australian economic forecaster BIS Shrapnel said Monday that the Indonesian economy "is on the brink of collapse." Indonesia's $133 billion foreign debt had escalated from 60 percent to over 200 percent of GDP due to the falling rupiah, and warned that the country would experience a dramatic decline in demand, due to the rising import prices and increasing unemployment.

Toyota Motor Corp. considered suspending production at the factory entirely after the holidays, but decided instead to trim production because of the possible adverse effect on the local economy of closing Indonesia's largest auto plant. Instead, it will only cut production in Indonesia by half.

But defying the escalation of social unrest, the Indonesian currency rallied and regained more than 23 percent of its value Tuesday as Japanese banks and the Indonesian governments outlined new plans to halt its slide.