Racial discrimination against the ethnic Chinese manifested itself in colonial laws. These laws in different forms continued to be upheld after Indonesia's independence and impeded national unity in Indonesia. This chapter examines the legal position of the Chinese in Indonesia since the Dutch colonial era with special reference to some of these laws made during the New Order regime. It also discusses these laws in the context of international laws against racial discrimination and ends with some suggestions to resolve the issues which affect nation-building.

The Legal Position of the Ethnic Chinese in Indonesia

The ethnic Chinese, constituting about 3 per cent of the population, have been in Indonesia for centuries. They were treated as a racial group different from other populations in Indonesia. During the colonial time they were perceived as harmful towards the indigenous population by the Dutch, and after Indonesia's independence, they were perceived to dominate Indonesia's economy by many indigenous Indonesians. In fact, they have been discriminated against since the colonial period.

Racial discrimination against the ethnic Chinese in Indonesia has been considered a given. The colonial administration segregated the migrant Chinese community and perpetuated the racial prejudice against them. Ethnic Chinese have been recognized as part of Indonesian society since the Dutch colonial era. Article 163 of IS (Indische Staatsregeling Wet van 2 September 1854, Ned. S. 1854-2, S. 1855-2 jo.1) stated that Indonesia consisted of three groups of people, namely (1) European people; (2) foreign Orientals (including the Chinese, Indian, and Arab); and (3) indigenous people.

However, racial division can be a form of racial discrimination. The Chinese appeared to have been singled out in such discrimination. This was the intention of the Dutch colonial rulers, through this divide and rule practice between indigenous people and the ethnic Chinese. The prejudices about the two “racial groups” were perpetuated. The ethnic Chinese were described by the indigenous people as being a very cagey community, selfish and exclusive, while the indigenous people were regarded by the ethnic Chinese as an inferior group who were hostile to the ethnic Chinese, and could not be trusted. This ethnic and racial division was maintained until the New Order government of Soeharto, as were the prejudices.