Following independence in 1949, Indonesia seemed well equipped for economic growth. It pos-
sessed an abundant population, rich mineral resources, vast oil reserves, valuable farmland, and
$2 billion worth of foreign aid. The economy was a disaster, however, for several reasons.
Problems with divided nationalities, religion, and politics sometimes resulted in
violent
clashes. In
1965, General Suharto produced strong economic growth by relying on oil and
agricultural
exports. The 1980s world "oil glut" and falling prices for farm products slowed
economic
growth.
In 1997-1998 Southeast Asia's economic crisis caused Indonesia's
economy to collapse. Suharto
later resigned under suspicion of misuse of funds.
2. What problems interfered with Indonesian industrialization?