(CNN) -- A stone's throw from Jakarta's Merdeka (Freedom) Square and opposite the city's largest mosque hunkers Indonesia's bastion of Catholicism, St. Mary's Cathedral.

A few times each week week, bells peal at the cathedral, sometimes competing with a muezzin whose amplified voice beckons followers of Islam to prayer at Al-Istiqlal mosque.

The houses of worship have sat opposite each other for decades, divided only by a narrow street in the heart of Asia's Koran belt.

Having endured centuries under Dutch masters and Japanese occupation during World War II, Jakarta is a city that has learned tolerance like few others in Asia.

But since the resignation of former President Suharto in May 1998, Jakarta has been a city in waiting. Indeed, the June 7, 1999, general elections could determine its political and economic stability in the years to come. Many hope that a return to the economic good times will redress social unease.

For as Jakarta heads into what will be its first truly democratic elections, its tolerance levels have slipped.

'People...must not be provoked'

In April, a bomb was detonated at the mosque and, for the first time in memory, armed guards were posted outside the mosque and the cathedral. President B.J. Habibie, who regularly prays at the mosque, issued a call for calm.

"This action could invite conflict between different religions," Habibie said. "People, particularly Muslims, must not be provoked by the bombing."

Jakarta, the capital of Indonesia, is the fifth most populous city in the world with 9.16 million inhabitants

Jakarta has the potential to rank alongside Hong Kong or Tokyo as a great city of Asia. It is a grittier version of the two, and has a 'can-do' attitude that international business firms have come to appreciate in the past decade.

But that recognition came before the riots that shut down the city in May 1998 and helped pressure Suharto into resigning.

Many investors have been reluctant to return since. Ethnic, religious and political unrest is common, and embassies continue to post warnings to their nationals.

One of the latest, from the Australian embassy (the strongest diplomatic mission in the country), warns its citizens that "there is a possibility of disturbances stemming from the heightened level of political activity."

Brought to a standstill

During the worst of the 1998 violence, thousands of ethnic Chinese fled Indonesia to avoid attack.

The scenes were similar to those that took place almost 260 years ago in Batavia -- Jakarta's colonial name -- when it oversaw the lucrative "Spice Islands" trade in the Dutch East Indies.

In 1740, citizens took to the streets and massacred 5,000 Chinese who they claimed were causing, among other things, "social problems."

The 1998 death toll was not as high, but the sentiment was familiar. Diplomats in the region say the recent attacks against ethnic Chinese were for similar reasons: economic hard times have brought unease, and the often-prosperous Chinese once again were the scapegoats.

Even without the riots and the nepotism of the Suharto years, Jakarta, like other Asian capitals, was brought to a virtual standstill when an economic crisis swept the region in 1997.

Small sculptures decorate the central courtyard of the National Museum in Jakarta

Major infrastructure projects are now gathering dust while the grim business of returning the region to prosperity is monitored by the World Bank and the International Monetary Fund.

But for the people of Jakarta, who have come from all over the Indonesian archipelago, the battle is at street-level.

From boomtown to 'struggletown'

Jakarta is capital to the fourth most populous nation on the planet and, with 9.16 million residents, is the world's fifth most-populous city.

It used to be a boomtown. Today, it is "struggletown."

Many lost their life savings in a matter of weeks when the rupiah lost 70 percent of its value, and Indonesians who had the gleam of riches in their eyes now work two and three jobs to make ends meet.

University enrollments are down and domestic tourism is at a trickle. Peeling billboards advertising the "good life" have in some cases gone unchanged for years. The once-bustling street markets are empty, and the ending of government subsidies on petroleum has forced many private cars off the road.

The battle is to make enough money to ride out the tough times and hope a new era of prosperity will follow. In the meanwhile, the future for most Indonesians is taken a day at a time.