Wall Street 1987 Sub Indo

[Robinette Ith]

Witha population of 240 million, Indonesia is the largest country in Southeast Asia and the most populous Muslim-majority nation in the world. Its size, its emerging democracy and economic vibrancy, and its strategic position across critical sea lanes linking the Middle East with East Asia have led many to consider it an emerging middle-tier power. The U.S. maintains close relations with Indonesia, with considerable security, economic, and trade ties, although human rights concerns about the Indonesian armed forces have long been a thorn in the relationship.

In the 12 years since a catastrophic economic crisis led to the fall of longtime President Suharto, Indonesia has undergone a remarkable transformation. It has held two successful direct Presidential elections, both of which were considered largely free and fair, and conducts dozens of actively contested provincial and local elections each year. Its economy regularly posts growth of better than 6% annually, although poverty remains considerable and corruption widespread.

Discussion of Indonesia has shifted from speculation about its possible breakup due to separatist sentiments in places such as Aceh, the Malukus, West Papua, and the now independent state of Timor Leste to admiration of its democratic transformation, its relatively strong performance in the recent global economic crisis, its cooperation in efforts to combat terrorism, and its growing role in regional diplomatic institutions, international efforts to combat climate change, and its membership in the G-20.

In recent years, U.S. policy towards Indonesia has focused on cementing ties with a geopolitically important state that can play an active role in regional diplomatic institutions, and encouraging Indonesia to combat terrorism and effectively counter the rise of violent Islamic militancy. The United States has also sought to promote democracy, the rule of law and human rights, and to further American trade and investment interests in Indonesia.

The election of President Barack Obama, who spent part of his childhood in Indonesia, did much to spur expectations in Indonesia that the U.S.-Indonesia bilateral relationship would be enhanced. President Obama's visit to Indonesia in November 2010, with the signing of a Comprehensive Partnership Agreement with Indonesian President Susilo Bambang Yudhoyono (SBY), did much to meet these expectations. The agreement covers a range of issues including trade and investment, food security, science and technology, educational exchanges, and military cooperation.

Congressional concerns have included oversight of the Obama Administration's policies towards Indonesia, including the Comprehensive Partnership, Indonesia's role in regional diplomacy, the restarting of comprehensive military-military relations, and policies to encourage human rights performance, particularly in restive West Papua.

With an estimated population of 240.3 million, Indonesia is the world's most populous Muslim nation and is the world's fourth-most populated nation overall after China, India, and the United States. Its population is growing by approximately 3 million people a year.1 It has extensive natural resources. A large percentage of world trade transits the strategically important straits of Malacca that link the Indian Ocean littoral to the South China Sea and the larger Pacific Ocean basin. Indonesia is also perceived by many as the geopolitical center of the Association of Southeast Asian Nations (ASEAN), which is a key actor in the geopolitical dynamics of the larger Asia-Pacific region.

Indonesia continues to emerge from a period of authoritarian rule and is consolidating its status as one of the world's largest democracies. Some 86% of Indonesians are Muslim, and the overwhelming majority subscribe to a moderate form of the religion, giving Indonesia the potential to act as a counterbalance to more extreme expressions of Islam. Despite this, radical Islamists and terrorist cells have operated in the country. Internal strife and social dislocation stemming from inter-communal discord, autonomous and secessionist movements, political machinations among elites, Islamist extremism, government corruption, and economic uncertainty have all undermined stability in Indonesia in the past. More recently, Indonesia has been conducting elections widely considered free and fair and building a more robust civil society. While Indonesia's economy suffered major setbacks during the Asian financial crisis of 1997/98, it has weathered the recent global economic downturn relatively well.

The key challenge for the United States and Indonesia is now how to build on recent progress in the relationship and deliver demonstrable results in developing the comprehensive partnership between the two countries that can further shared interests. Specific areas of Congressional interest include democracy promotion, security and counterterrorism cooperation, human rights, fostering liberal trade and investment policies, securing Indonesian cooperation on regional issues and global ones such as climate change.

The military-to-military relationship has been a key test of enhanced bilateral cooperation. In 2005, the Administration of President George Bush moved to remove restrictions on International Military and Education and Training (IMET), Foreign Military Financing (FMF), and Foreign Military Sales (FMS) programs for Indonesia. This was viewed by many as a first step toward normalizing the military-to-military relationship. Indonesia has been a key player in the war against terror in Southeast Asia and an increasingly important geopolitical actor in the Asia-Pacific region.

Despite these developments, many continue to have concern over human rights abuses in Indonesia. Other members of Congress, however, have emphasized the progress Indonesia has made in several areas. An example of military cooperation with Indonesia is the Tri-border initiative that involves radar and maritime operations in the Makassar Strait to monitor possible terrorist or pirate activity.2 Other examples include U.S. assistance to Indonesia's new defense university and U.S. assistance with the procurement of C-130 Hercules transport aircraft, which, according to Defense Minister Juwono Sudarsono, will take advantage of U.S. discount pricing and foreign military financing.3 U.S. Secretary of Defense Robert Gates announced in Jakarta in July 2010 that the United States would resume a "measured and gradual program of security cooperation" with Kopassus forces.4

During the Cold War, the United States was primarily concerned about communist influence in Indonesia. After the Cold War, congressional views on Indonesia were more influenced by ongoing concerns over alleged human rights abuses by the Indonesian National Defense Forces (TNI). The events of 9/11 added the concern of how best to pursue the war against terror in Southeast Asia. Some members of Congress remain dissatisfied with progress on bringing to justice Indonesian military personnel and police responsible for past human rights abuses in East Timor and West Papua. The January 2006 arrest of Anthonius Wamang, who is thought to have led an attack near the town of Timika in Papua that killed two Americans, did much to resolve what had been an obstacle to developing the relationship. As the United States moved from the post-Cold War world to the war against terror, human rights concerns have increasingly been balanced against American security interests, and particularly the need to develop effective counterterror cooperation with Indonesia to combat radical Islamic groups. Over the same period, the human rights record of the TNI is generally perceived to have improved. There is also increasing appreciation of Indonesia's geopolitical position within Southeast Asia and the larger East Asia region among American decision-makers.

Some analysts have argued that the need to obtain effective counterterror cooperation and to secure American strategic interests in the region necessitates a working relationship with Indonesia and its key institutions, such as the military. Other observers take the view that the promotion of American values, such as human rights and religious freedom, should be preeminent in guiding U.S. relations with Indonesia.

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