Peter McCawley (1944-2023): A Trailblazer in Australia’s Engagement with Asia

By Howard Dick, a professorial fellow in the Faculty of Business and Economics at the University of Melbourne

Peter McCawley was one of the great trailblazers of Australia’s relations with Indonesia, writes Howard Dick. As Australia regrettably reverts to being a “more inward-looking and parochial nation” there are many lessons to learn from McCawley’s life-long efforts to bring Australia closer to its immediate region.

In the 1960s, reality began to dawn for Australians that newly independent Indonesia was geographically “our closest neighbour”. Nevertheless, getting to know and relate to Indonesia was a huge challenge, especially because of President Sukarno’s increasingly erratic rule. In fact, in the mid-1960s Australia and Indonesia were on opposite sides of an undeclared war along the border of the newly created Malaysia.

It was therefore a brave and seemingly foolhardy initiative by Professor Heinz Arndt, head of the Department of Economics of the then Research School of Pacific Studies (RSPS) at the Australian National University (ANU), to set up an Indonesia Project in 1965.

Peter McCawley would be one of the project’s first PhD graduates. His career over the next 50 years saw Indonesia emerge from authoritarian ‘basket case’ to bustling G-20 economy and boisterous democracy. Peter, who passed away on 18 July after a long battle with cancer, contributed significantly to that transition as well as to better Australia-Asia ties. More importantly, he showed how Australians might actively and respectfully engage with an Asian ‘other’ that is still more easily invoked as threat than welcomed as opportunity.

The RSPS doctoral program had the remarkable feature that candidates would be sent into the field for twelve months and have to negotiate language and culture as part of the research. Peter arrived at ANU with a first-class honours degree in Economics from the University of Queensland but only rudimentary knowledge of Bahasa Indonesia. It would be a struggle living in very basic accommodation in hot, steamy, densely populated Jakarta where the power was unreliable, phones did not work, and public transport was mainly autolettes and becak. He persevered and in 1971 submitted a fine thesis on the performance and regulation of Indonesia’s electricity industry, a practical topic that remains highly relevant.

In January 1972, Peter was posted to Universitas Gadjah Mada (UGM) in Yogyakarta to help set up, teach, and manage the new Master of Economics course that was being introduced for bright junior lecturers  from across Indonesia, a cohort of around twenty each year. His two-and-a-half years at Fakultas Ekonomi/UGM would be a turning point in the Faculty’s fortunes. During the 1960s the Faculty had suffered from Sukarno’s ideological campaigns, then the Suharto purges (which claimed several staff members), and drastic shortage of funds. Like other civil servants, academic staff were hopelessly underpaid and needed other part-time teaching, consultancy or supplementary activities to make ends meet in supporting their families. In consequence, the cavernous staff rooms with their rows of heavy wooden desks were all but empty because lecturers only came in to teach, then resumed their other part-time jobs. Peter, who was paid a full-time salary, kept office hours until going home for lunch, by then dripping with sweat, around 2pm. The other two regulars were the dynamic, then 40-year-old Dean, Prof. Sukaji Ranuwihardjo and the M.Ec. convenor (then Dr.) Mubyarto (whose poultry business was a useful side-income). This core set in train the professionalisation of the Faculty and its closer integration with the technocrats in the New Order Government. Peter won Sukadji’s trust early on and became a close confidant at a difficult time. Sukadji went on to become UGM Rector in 1973 and subsequently Minister of Education, while other core staff also went on to become departmental heads or ministers. Boediono, who co-authored with Peter in 1976 a much-needed textbook in Bahasa of micro-economic readings, became governor of Bank Indonesia and then vice president (2009-2014).

In 1972 the Yogya region was desperately poor with endemic malnutrition. The then small town was very quiet and peaceful with almost no motor vehicles, Peter’s Landrover being one of the few exceptions. Exemplifying the topic of Peter’s thesis, the power supply was intermittent with brown-outs of an evening. Peter joined Mubyarto in visiting the district’s villages and saw rural poverty close up.

While at the University of Queensland, Peter had become involved in Labor Party politics in opposition to the war in Vietnam. He therefore found it frustrating to observe the early years of the Whitlam government from afar. However, in mid-1975, when Whitlam appointed Bill Hayden as Treasurer after the disastrous tenure of Dr. Jim Cairns, Peter was asked to become Hayden’s personal economics advisor, and so returned from UGM some months early. By then inflation was already out of control and little could be done to repair the damage before Whitlam’s dismissal by the Governor General five months later. It was a difficult period, but Peter worked well with Hayden, and it gave Peter invaluable experience of the practicalities, pitfalls and limitations of government.

After the Dismissal, Peter returned to RSPS as a Research Fellow. In 1979 when Heinz Arndt was about to retire, he was the obvious person to carry on the Indonesia work of the Department and secure the future of the then ‘in-house’ Bulletin of Indonesian Economic Studies. Appointed to the new position of Director of what now became the Indonesia Project, he laid a solid foundation by defining a clear remit, securing grant funding from the Department of Foreign Affairs, maintaining a continual flow of visitors from Indonesia, and vigorously engaging with scholars, officials and ministers in both countries. From 1983 the relationship was deepened by inauguration of the annual and ongoing Indonesia Update.

Peter McCawley (second left) with three other Indonesia Project Directors. From the left, Budy P Resosudarmo, Hal Hill, and Chris Manning.

Peter McCawley (second left) with three other Indonesia Project Directors. From the left, Budy P Resosudarmo, Hal Hill, and Chris Manning. Source: SBC Indonesia

Nevertheless, as Peter had anticipated, his commitment to the Indonesia Project made it harder to build the publication record needed for an academic career. Despite joint editorship of the seminal book The Indonesian Economy During the Soeharto Era (OUP, 1981), he was unable to turn his PhD into a monograph or to bring out a defining monograph. If the truth be told, his motivation was somewhat lacking. He was impatient with economic theory as such and far more interested in finding ways to make things happen.

While back in academia, Peter had continued to hone his policy skills. With the World Bank, he wrote an excellent report on Indonesia’s accelerating industrialisation. Then in 1983 he was appointed as a member of the Jackson Committee’s Review of the Australian Overseas Aid Program, which did much to clarify and sharpen the strategic goals of Australia’s international development aid and to professionalise its management and implementation.

In January 1986, during the second Hawke Labor government, Peter took leave from ANU to become Deputy Director-General of the Australian International Development Assistance Bureau (AIDAB) in charge of international programs. He would remain a senior bureaucrat for the next 20 years. AIDAB was a perfect match for Peter’s interests and practical talents. His principles were simple and could be summarised as ‘the dignity of man’. That meant a commitment to lifting people out of poverty through education, jobs, good health and housing. In economic terms, the key to raising welfare was economic growth. Through all changes of fashion, Peter kept his eye on economic growth and reminded anyone who would listen to do the same. A bigger pie benefited everyone. At the same time, he was mindful of equity, not a proponent of ‘trickle-down economics’. Growth and equity were complementary, which informed his approach to foreign aid, including the need to set clear project objectives and carefully target the recipients. The third leg was institution-building. Peter took on board Gunnar Myrdal’s contrast between ‘soft’ and ‘hard’ states (Asian Drama, 1968) and realised that good policy initiatives would fail if not underpinned by institutions committed to their success.

In 1992, Peter took leave from the Public Service to serve a four-year term in Manila as an Executive Director of the Asian Development Bank (ADB), representing the interests of Australia and seven other countries: Cambodia, Hong Kong, Kiribati, Federated States of Micronesia, Nauru, Solomon Islands, and Tuvalu. This role sharpened his focus on the need for physical infrastructure, but he did not lose sight of economic growth. As he said in his farewell remarks to ADB in January 1996, “The single most important economic policy issue across Asia is the need to promote strong and sustainable economic growth”. In 2003, he returned to ADB for a four-year term as Dean of the ADB Institute (ADBI) in Tokyo (2003-07), thereby resuming an educational role after his somewhat premature departure from Gadjah Mada University. On retirement in 2007, he was appointed Honorary Associate Professor in ANU’s Crawford School, subsequently writing the 50-year history of the ADB, Banking on the Future (2017).

Though Peter did not quite reach the pinnacle of either academia or the Commonwealth Public Service that his abilities should have allowed, he made an outstanding contribution to both and his influence was vast. Not only was he very good at getting things done. He was even better at guiding and helping others to get things done while not claiming any share of the credit. Especially, he helped many Indonesians to get things done and took great pride in Indonesia’s remarkable progress over the past 50 years. This perspective illuminated his 50-year history of the Jakarta-based Centre for International & Strategic Studies (CSIS), Ideas and Policy in Indonesia (2021), as also his quiet work on Wikipedia in documenting the backgrounds and lives of some of Indonesia’s leading policymakers.

Peter is remembered fondly around the Asia-Pacific as a consummate professional and the very best of colleagues and friends. He well deserved his award in 2019 of Member of the Order of Australia (AM). In the round, he is remembered for his principles, warmth and generosity. Beyond everything, he is remembered for his deep well of humour. He could be abrasive but then dissolve tension or argument by a sudden joke and chuckle. He was a serious person but did not take himself too seriously. This may have been the key to his bond with Indonesia. His volatile Irish (paternal) and Russian (maternal) roots gave him a zest for human engagement. Whether in English or Bahasa, Peter amused and teased as he engaged without any sense of colonial arrogance. This diplomatic skill later informed his interactions with the Asian Development Bank across the Asian sphere.

Peter’s unconventional and exemplary career was a massive return on the public and his own investment in ‘human capital’, highlighting the importance of developing language and intercultural skills alongside disciplinary expertise. He was one of the ‘best and brightest’ to emerge from the commitment to education of the Menzies and Whitlam eras. Fifty or more years later, there should be many tens of thousands of Australians embodying those skills and pursuing rewarding careers that engage with Asia. Sadly, that is not the case and in fact pathways are still being closed off. The National Asian Languages and Studies in Schools (NALSAS) program was closed long ago by the Howard government, the curriculum lapsed, and the teachers were lost.

In the past year, the National Library of Australia has abandoned its mandate to maintain an Asian-language book collection, closed its Asia section, and left those skilled librarians in limbo. The same pattern is being repeated at the state level. Australia is becoming a much more inward-looking and parochial nation that is easily frightened by ‘hyped up’ threats of Asian infiltration and invasion.

It has become so much easier to commit hundreds of billions to a fleet of submarines than to commit tens of millions to foreign language education, library resources, and cultural exchange. Those who do manage to acquire intercultural skills, whether from English-speaking or ‘ethnic’ backgrounds, still find their skills to have little or no market value in business, government or even academia.

As we honour Peter McCawley’s life of service, we should, like him, look confidently to the future. His example shows how Australians can and should engage professionally with our Asian friends and neighbours while enjoying each other’s company and sharing life’s journey.

Howard Dick is a professorial fellow in the Faculty of Business and Economics at the University of Melbourne.

Image: Crawford School of Public Policy