"Bribery and corruption are firmly outlawed here," the British businessman said. "They have a vigorous, highly publicized campaign going on to stamp them out for once and for all."

The anti-corruption campaign, he added, has had a dramatic effect on business. "It's doubled the cost of bribery."

Indonesia is gold rush country for political corruption, bribery, illegal fees and bureaucratic red tape.

The British businessman, for example, is overseeing the construction of a $2 million pharmaceutical factory. His firm estimates bribes for various permits, licenses and fees will run about $200,000. It spent $20,000 on bribes just to buy the land for the factory.

"You have to make the rounds," he said. "Everybody gets his share: the provincial governor, his staff, the village chief, the local school teacher and even the local witch doctor. You don't want him to put a hex on your factory and make it an unlucky place."

Such problems are endemic to the Third World. Poverty breeds inefficiency and corruption. Seldom is the corruption as blatant as in Indonesia, where it reaches to the top ranks of government; but it's found in one form or another in most of the world's poorest countries.

Western diplomats tend to shrug off the importance of this corruption, even though it led to widespread student disorders here in Indonesia.

"When you deal with this country, you just have to accept corruption," said one U.S. diplomat in Jakarta. "You just can't put things in front of people who've never had anything and not expect them to take some for themselves."

"How can we expect them to listen to us when they all know about Watergate and Tongsun Park?" asked another.

But corruption in the Third World is different from the United States. It's far more pervasive. It touches not only the rich and powerful, but the poorest of the poor.

Bureaucrafts have almost institutionalized a system of illegal fees in some countries. Indonesian police set up road blocks to collect "pungli" (illegal levies) from truck drivers. Agriculture agents in Pakistan demand small payments for rat poison that they're supposed to give out free.

"Corruption has become epidemic in the police force, the judiciary and other government and party offices," Tanzanian Attorney General Ndugu Joseph Varrioba has said. An ordinary without "offering something."

Although the Tanzanian government is making a major effort to increase agriculture equipment such as a tractor without bribing the dealer."

The governments of Tanzania and Indonesia are acutely aware of the corruption problem, and have launched well publicized crack downs. Almost every day, local newspapers carry reports on some official or another being arrested.

In March, the head of the Indonesian anti-corruption force, Adm. Sudom, reported that 478 officials had been apprehended the previous month in 363 cases of corruption or abuse of power.

But there is a strong undercurrent of public suspicion about the anti-corruption campaigns. A letter to the editor of the Tanzanian Daily News, for instance, applauded the effort, but also accused those hailing the drive of hypocrisy.

"Many who are staunch supporters of the directives," the writer charged, "are in the frontlines of corruption and bribery,"