When the current government came into power in September 2013, it promised a foreign policy with greater focus on Indonesia as both a strategic ally and diplomatic partner. This rhetoric has thus far been largely unsubstantiated. While there has been a noticeable escalation of ties with East Asia – as in the highly publicised free trade agreements and Abbott’s ill-advised Japan as “best friend” remark – relations with Jakarta have stagnated and suffered through crises. There is little evidence of a shift in focus to Indonesia. In fact, positive and constructive engagement appears to have declined.
Australia-Indonesia relations started at a low point for the current government with news of the spying scandal in 2013. Australia’s Ambassador to Indonesia Greg Moriarty was called in for a please explain and Indonesia’s own representative was withdrawn from Australia. Relations remained icy in the scandal’s wake.
In May 2014 Ambassador Kesoema returned to Canberra, representing an easing of tensions. Julie Bishop and Marty Natalegawa signed a Joint Understanding in the second half of the year, an action that at least superficially indicated a resolution to the highly public problems that had been dogging the relationship.
This was clearly not an ideal start to Abbott’s plans for greater engagement with Jakarta, but for a period we seemed to have returned to business-as-usual. The last six months have given the two countries a chance to engage and move forward. Now Jokowi’s decision to get tough on narcotics is likely to disrupt relations yet again. The government’s dealings with Indonesia could be forced towards a crisis and damage control – as we have seen so many times in the past – and away from the happier headlines we would like to see.
Let us examine Australia’s relationship with Indonesia across a range of areas and issues to better understand whether “more Jakarta” has translated into real policy outcomes.
Construction is underway on a new Australian Embassy in Jakarta. When completed it will be the largest Australian overseas diplomatic post in the world. The facility is valued at AU$415 million and is expected to be ready for use later this year. This project will substantially boost the Australian presence in Indonesia and emphasise the importance Australia places upon Indonesia. However, this project was started back in 2012 under a Labor government so it cannot be claimed as a “More Jakarta” initiative.
The trade relationship between the two countries has grown steadily in recent years. Australia’s two-way trade with Indonesia increased by 12% from 2012-13 to 2013-14, and across the past five years there has been a 6.5% growth trend. The total trade in goods was valued at over AU$12 billion for the 2013-14 period, but this only represents 2.3% of the total share of Australia’s import and export activities. This puts Indonesia as Australia’s 10th largest trade partner. This is positive, but it is unclear whether this growth in business is driven by government initiatives, or is simply a natural increase.
On the Indonesian side, crude and refined petroleum represent the greatest exports to Australia, with a combined value of AU$2.5 billion. Travel remains Australia’s largest service import from Indonesia, valued at almost AU$2 billion each year. The large number of Indonesian students coming to study in Australia means that education as an export is worth AU$541 million to the Australian economy. Looking at commodities, wheat is also a strong export contributing almost AU$1.2 billion annually. Australia is Indonesia’s 9th largest import source and 10th largest export destination. Considering the size of the Indonesian market, and Indonesia’s proximity to Australia, there is certainly great opportunity to expand trade.
Indonesia is the largest recipient of Australian aid. Australia is set to contribute an estimated AU$605.3 million to aid projects in Indonesia in 2014-15. However, the Australian aid program will be stabilised at an overall AU$5 billion contribution in 2015-16 and then only increased annually to match inflation, effectively ruling out the promised increase in aid funding to 0.5% of GNI.
Julie Bishop states that “the government is making decisions that repair the budget, strengthen the economy and prepare Australia for the long-term challenges before us”. Aid is on the chopping block. Though Indonesia remains the recipient of a large amount of aid from Australia, a much greater contribution could be made.
Australia likes to stress its aid contributions as being highly beneficial to Indonesia, but realistically they can only make a small difference in such a vast country. Hugh White – writing in the Monthly in 2013 – argued that Australia must not rely on monetary contributions as a substitute for strong engagement and diplomacy. This argument remains relevant today. Prime Minister Abbott recently made a serious error in judgement by trying to leverage past aid contributions as a reason for Australian nationals on death row to be kept alive. His blunder was in bringing up Australia’s $1 billion support package to Indonesia – to assist with the disaster relief after the 2004 tsunami – as though this assistance warranted some sort of back-scratching in return. Let us hope that no further attempts are made to use aid as a bargaining chip; this can only cause damage.
Shadow Foreign Minister Tanya Plibersek recently criticised Australia’s current approach to foreign aid. She mourned the loss of skilled personnel with experience and aid expertise due to the AusAid-DFAT merger, as well as the scrapping of various successful aid programs. Plibersek fears that it will be left to the next government to “rebuild our Australian aid program”.
Her comments indicate that a Labor government would be more generous in its aid spending. However, we need only look back to the last Labor government’s broken promises regarding aid targets to understand that any statement on revamping the aid program must be taken with a grain of salt.
At a grass roots level, there is positive engagement. There exists infrastructure to maintain a flow of people between the two countries, regardless of the political climate. The Australia-Indonesia Institute administers various engagement and exchange programs, including the long-running Australia-Indonesia Youth Exchange Program and the BRIDGE project. It also offers grants for individuals and organisations looking to undertake projects or work to strengthen bilateral ties, with overall funding of AU$880 million.
The Australia Indonesia Centre – established in 2013 – is another Australian government initiative that was started to further develop relations between the two countries. This is perhaps the Abbott government’s most tangible contribution towards strengthening ties with Indonesia. Abbott committed AU$15 million over four years to help kick-start this new body.
Beyond government-supported initiatives, the relationship flourishes in regards to travel and educational exchange. Programs run by the Australian Consortium for ‘In-Country’ Indonesian Studies (ACICIS), among others, have transported countless Australia students to universities in Indonesia. Similarly, thousands of young Indonesians study at Australian institutions.
The Colombo Plan also facilitates student exchange, and with the so-called ‘reverse’ Colombo Plan coming into full effect this year – and the Australia Awards scholarship program alive and well – the educational and people-to-people links between the two countries will continue. This is a historically positive area of engagement and the current government has built upon strong foundations.
This optimism must, however, be tempered with a word of caution. Study and knowledge of Indonesia and its language remains at dismally low levels in Australia. Domestically, a greater focus on Indonesia in schools and universities would be of immense long-term value.
Security and Police Cooperation
Cooperation between Indonesian police and the AFP on cyber crime and people smuggling was shut down in reaction to the spying incident. Following the resolution of tensions, collaboration has slowly resumed.
Some argue that police cooperation is a constant – like education and people-to-people links – that can help restart broader cooperation following low points in the relationship. Connery, Sambhi and McKenzie outline a range of avenues for improving work between the AFP and Indonesia’s POLRI. Engagement is strong on policing but there is room for improvement.
Security cooperation is supported by the Agreement between the Republic of Indonesia and Australia on the Framework for Security Cooperation, signed in 2006. The agreement encourages stronger collaboration on a wide range of security issues, including defence, law enforcement, counter-terrorism, intelligence and maritime security.
The 2+2 Dialogue, last held in 2013, was a valuable meeting allowing the defence and foreign ministers from both countries a chance to sit down and discuss matters of security and defence. This initiative regrettably appears to have fallen off the radar as other matters dominate the concerns of both governments. The planned 2014 meeting did not go ahead.
Maritime issues offer huge potential for collaboration given the importance of the navy for both countries, surrounded by water as they are. Jokowi desires to strengthen Indonesia’s port infrastructure and greatly expand its naval capabilities as part his ‘Global Maritime Nexus’ strategy. Australia is looking to purchase a number of new submarines in its own efforts to improve its sea presence. As Indonesia’s naval strength grows, opportunities for joint training and similar collaboration will only increase. A recent Australian Strategic Policy Institute report contends that some creativity and “innovative thinking” is needed to spark closer cooperation on the sea.
Indonesia is of great strategic importance to Australia given its location, expanding military, growing population and growing economy. It has the potential to control busy sea-lanes and of course maintains a central role in ASEAN. While our relationship is strong in this area, particularly on policing, there is much room for expansion. As the cessation of cooperation following the spying scandal indicates, the relationship is ever so vulnerable to spats and short-term disagreements. This needs to change if defence and security cooperation is to continue to grow.
We should keep an eye out for the upcoming release of the 2015 Defence White Paper. While the current government has made no major changes in Indonesia-Australia security ties thus far, the new White Paper is predicted to signal a significant strengthening of Australia’s defence capabilities with a greater focus on regional cooperation. We will have to watch this space regarding Australia’s plans with Indonesia.
The execution of Australian nationals in Indonesia – especially considering the current political climate and wide media attention – is likely to damage relations and lead to decreased cooperation. The Australian government is considering appropriate responses should the executions proceed.
Abbott’s flagging popularity could also influence his decision; he has acted swiftly and firmly in the past when Australia and its citizens are threatened overseas, most publicly in his open criticism of Putin following the MH17 incident. A similar strong response would not be surprising in this case; the government has not ruled out withdrawal of the Ambassador from Indonesia.
We must remember that Australia is not as important to Indonesia as Indonesia is to Australia. Jakarta is thought about a great deal more in Canberra than Canberra is in Jakarta. Australia has to work at this relationship to promote its own interests and also to be receptive and open to those of Indonesia. Work is certainly being done, but there is room for more.
The relationship is ever changing. One political issue can create tension for a period, but will eventually be resolved and forgotten. This typically allows the situation to calm and begin to improve, but another seemingly inevitable roadblock always arises. People-to-people links remain strong throughout this vacillation. It is at the political level that solutions must be found.
We must develop a way to manage our disputes amicably instead of letting our friendship deteriorate under every fresh challenge. In any relationship there will be disputes and clashes; the way these challenges are handled is most important. Greater high-level engagement and communication would certainly curb the propensity for strained relations.
The government is yet to follow through on its “more Jakarta, less Geneva” promise. While many of the issues affecting the relationship have been out of the government’s control, its efforts to better engage and work collaboratively with Indonesia have been inadequate. Prospects for improvement in the near future are dim.
Sebastian McLellan is the Australian Foreign Policy Fellow at Young Australians in International Affairs.
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