Facing the Enemy

Just nine days after his overwhelming re-election as President of the world’s most populous Muslim-majority nation, Susilo Bambang Yudhoyono was overcome with rare emotion. In a statement televised nationwide, S.B.Y., as the moderate former general is commonly known in Indonesia, held up a picture of himself. But this was no ordinary campaign poster. Instead, the 59-year-old, his voice cracking, announced that gun-toting, balaclava-masked terrorists were using his face as target practice. Indonesian intelligence, said the President, had uncovered evidence that unnamed parties would unleash “a revolution if S.B.Y. wins.”

(Read “Indonesia Elections: A Win For Democracy.”)

S.B.Y.’s emotional outburst, complete with tantalizing but vague allusions to political figures who might want to harm him, came just hours after a pair of suicide bombers detonated their deadly loads in two luxury hotels in Jakarta, the country’s capital. Seven bystanders were killed in the July 17 attack, most of them foreigners, bringing an end to a four-year lull in terrorist activity in Indonesia. A few days after the dust cleared, Indonesian police implied that the terror strikes at the JW Marriott and Ritz-Carlton might be the handiwork of Noordin Mohammed Top, a Malaysian fugitive believed to head an offshoot of Jemaah Islamiah (JI), a homegrown terrorist network linked to al-Qaeda. A trained accountant, Noordin is considered the mastermind of a 2002-05 reign of terror in Indonesia that included two bombings on the resort island of Bali, a hit on the Australian embassy in Jakarta and a car bomb targeting the same Marriott struck on July 17. The spate of attacks, which killed around 250 people, was clearly designed to target Westerners, whose presence presumably sullies JI’s stated vision of creating a pan-Asian Islamic caliphate.

(See pictures of a deadly dam burst near Jakarta.)

The possible resurgence of JI must be particularly disheartening for Yudhoyono, a leader who had made cracking down on Islamic extremism a hallmark of his first term. S.B.Y.’s assertion that the attacks may have been linked to a desire to wound him politically also seemed a bit dissonant. “It was premature and not very sensitive … to try to divert the attention to himself,” says Nico Harjanto, senior researcher at the Center for Strategic and International Studies in Jakarta. “If he wanted to talk about a threat to himself he could do it later and not right after the bombing.”

Yudhoyono’s popularity was burnished by the perception that he was reshaping an often chaotic collection of 17,000 disparate islands into a stable, vibrant country with solid economic prospects. Just 11 years after the country made a transition from dictatorship to democracy, Indonesia has emerged as a regional standout. On the terror front, he presided over the diminishment of the JI network by arresting hundreds of militants and sending potential extremists to re-education camps. An abrupt cessation in violence appeared to prove the strategy’s success. But with blood staining Jakarta anew, terror analysts are beginning to ask whether enough was done. For one, asks Anies Baswedan, rector of Paramadina University in Jakarta, what has happened to the dozens of JI operatives who have been released from jail in recent months after serving their sentences? “We don’t know what they are doing,” he says. “There must be some monitoring mechanism to ensure they are not regrouping.”

Police are speculating that one of the suicide bombers, tentatively identified as 35-year-old Nur Said (also possibly known as Nur Hasbi or Nur Aziz), may have attended the infamous al-Mukmin Islamic boarding school in central Java that also produced two of the Bali bombers and the man who blew himself up at the Marriott in 2003. Given the school’s notorious alumni, should the government have shuttered al-Mukmin? Noor Huda Ismail, head of the Institute for International Peacebuilding in Jakarta and a graduate of al-Mukmin, doesn’t think so. “It’s like an aquarium that can be monitored [by the police],” he says. “It is more about personal connections than a breeding ground for terrorists. Even some members of parliament graduated from there.”

See pictures of Bali reeling from destruction and mourning loss.

Though the blasts jolted a nation into realizing that terrorism was no longer a thing of the past, the prevailing attitude among Jakarta residents seems to be one of determined resilience. “Bad things can happen anywhere: car accidents, illness,” says Syarif, an accountant window-shopping at a glitzy mall with his wife and two small children. “The bombing was bad, but we have to continue our lives.” By the end of the weekend after the blasts, restaurants and bars were buzzing again in the Indonesian capital, even though security measures at some potential targets were lackadaisical. At one five-star hotel, for instance, guards failed to adequately check approaching taxis while a bomb-sniffing dog snoozed at the checkpoint.

Now the question is whether the foreign community will be as relaxed. Over the past year, Indonesia has profited from the political uncertainty in regional neighbors Thailand and Malaysia, with foreign investors considering the once turbulent country as an alternative location to park their cash. Indonesia recorded 4.4% year-on-year growth in the first quarter of 2009, a particularly impressive feat given the global economic crisis. But the July 17 bombings, as well as the assassination a week earlier of an Australian mine employee working in the remote province of Papua, reminded the world that foreigners continue to be the intended victims of terrorism in Indonesia. Not only did the bombs detonate at two American-branded hotels that are popular with foreign guests, but the suicide attacker at the Marriott appears to have deliberately targeted a side room where a group of mostly Western businessmen and diplomats were conducting a breakfast meeting. Three Australians, one New Zealander and an Indonesian who were in that room were killed.

(Read “Why Indonesia Matters.”)

Risks to foreigners notwithstanding, there are some encouraging precedents for the country’s economic prospects: the 2003 Marriott bombing didn’t result in a major investment outflow, and Bali’s tourist trade eventually recovered from the pair of attacks on its soil. “The initial reaction of the international business community is one of concern but not so much as to deter plans for investment,” says Arian Ardie, a strategic-risk consultant and member of the American Chamber of Commerce in Jakarta. “People are better able now to put things in perspective. They know this is not an unstable country but the act of a few crazed individuals.”

Still, it takes only a few renegades to wound the reputation of a country of 240 million people. Indonesians decisively rejected Islamic political parties in April’s legislative elections, partly in reaction to the violent ideology that has crept into some strains of political Islam. But as Ken Conboy, a terrorism expert who has written a book on JI, notes, the recent hotel attacks were “probably organized by about 10 guys, so it will be hard to stop these kinds of things from happening.”

That’s a sobering prospect for S.B.Y., whose legacy during his second term will depend somewhat on his ability to keep terrorism at bay. Luckily for the President, in his first five years in office he enabled Indonesia to establish one of the most knowledgeable and dedicated antiterror units in Asia. S.B.Y.’s supporters, of whom there are many, aren’t letting the bombings ruin the postelectoral season. “This is a distraction, but I would not say the honeymoon is over,” says Bara Hasibuan, a member of Yudhoyono’s campaign team. “If the police make more arrests over the next few weeks, we will recover the confidence of the Indonesian public.” A nation awaits.

— with reporting by Jason Tedjasukmana/Jakarta

See pictures of terror in Jakarta on LIFE.com.