Indonesia and Australia’s Foreign Policy White Paper

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Indonesia and Australia’s Foreign Policy White Paper

A shared understanding of the Indo-Pacific could form the basis of a stronger Indonesia-Australia partnership.

Indonesia and Australia’s Foreign Policy White Paper
Credit: Flickr/ Australian Embassy Jakarta

Australia’s new Foreign Policy White Paper, released in November – the first since 2003 – reiterated and emphasized the importance of the Australia-Indonesia relationship. This is nothing new, as the Rudd government’s “Indonesia Country Strategy” of 2013, and the Gillard government’s “Australia in the Asian Century” (2012) include Indonesia in their foreign policy focus. What is new in the latest White Paper is how closely Australia’s strategic relationship with Indonesia is placed within the context of the Indo-Pacific.

The White Paper makes the argument that Australia should take responsibility for its own security and prosperity, and at the same time acknowledges that Australia is “stronger when sharing the burden of leadership with trusted partners and friends.” Whilst these partners and friends span the world, the White Paper leaves no doubt that the focus is on those in the Indo-Pacific, and particularly with the region’s major democracies – the United States, Japan, India, South Korea, and Indonesia.

Indonesia-Australia Relations

The attention given to Indonesia in the White Paper is reasonable and constructive in the context of Australia’s strategic and trade interests. They are close neighbors, share a maritime border, and their relationship is long-standing and mature, despite moments of strain.

Indonesia, by some estimates, is predicted to be the world’s fifth largest economy by 2030, has a growing middle-class, and is strategically placed in terms of size, significance and geography at the juncture of the Indian and Pacific Oceans.

In terms of economic relations, Australia and Indonesia just completed the 11th round of negotiations on the Indonesia-Australia Comprehensive Economic Partnership Agreement last week. While this round was expected to be the final round of negotiations, it seems that several issues remain unsettled, including market access and financial services.

On the security front, they recently reaffirmed their commitment to the Lombok Treaty of 2006, which forms the basis of their defense and security relationship. Both countries have a common interest in, and work together on, issues such as combating terrorism, human trafficking, maritime safety and security, and food security.

They also aim to deepen collaboration to further strengthen regional institutions and forums such as the East Asia Summit (EAS), the ASEAN Defense Ministers’ Meeting Plus, the Asia Pacific Economic Community (APEC), and the Indian Ocean Rim Association (IORA).

The Challenge of Working Together in the Indo-Pacific

A shared understanding and prioritization of the Indo-Pacific has the potential to form the basis of a stronger Indonesia-Australia partnership, yet the concept needs further unpacking and definition. Abstraction will only lead to multiple, and possibly conflicting, interpretations and expectations — and a truly collaborative Indo-Pacific requires consensus among participants.

The White Paper acknowledges that the United States and China are important partners in the Indo-Pacific, but both are currently unpredictable and possibly unreliable. This situation may present a challenge to consensus on and collaboration in the Indo-Pacific for Indonesia and Australia. Both governments work closely with China, but have their own apprehensions regarding China’s rise. And despite common concern in many instances, they have not always responded in the same way to U.S. policies, such as the executive order for a trade investigation, the withdrawal of U.S. commitment to free trade and climate change, and the U.S. decision to acknowledge Jerusalem as the capital of Israel.

Still, the White Paper’s focus on the Indo-Pacific has merit in that it draws together countries to the west and east of Australia – it acknowledges the rising importance of India, and it shows that other countries, in addition to China and the United States, are important considerations, and partners, especially for Australia. For Indonesia, while India is currently a top-five export destination, the level of foreign engagement with India still leaves much room for improvement.

Yet the Indo-Pacific is primarily defined in geographic terms in the White Paper, rather than strategically. As Peter Drysdale recently wrote, the White Paper “adopts the Indo-Pacific idea but neither tests it nor defines it,” leaving the concept precariously open to interpretation. Will it be read as a strategy of engagement, or containment (of China)? Or both? It has been considered as a way to acknowledge India’s growing economic power and a “hedge” against China. It is also seen as a concept that gives more attention to maritime Indo-Pacific countries at the expense of continental partners, but one that is so wide and diverse that no one power can dominate.

The Importance of Consultation

As a foreign policy approach, Australia can conceptualize the Indo-Pacific on its own terms, but as a strategy and means of engagement, it will require consultation with its partners. How the concept is perceived and responded to will feed back in to how it can be operationalized.

A lack of consultation has often troubled Australia’s relations with its Asian partners. In 1973, former Australian Prime Minister Gough Whitlam proposed an Asia and Pacific forum encompassing the then five states of the Association of Southeast Asian Nations (ASEAN), Australia, New Zealand, China, India and Japan. Yet on a visit to Jakarta in the same year, the response from Indonesia’s then-President Suharto was clear – there were not enough common interests within Asia for Whitlam’s plan to be practicable. Suharto doubted the “usefulness of a formal conference or organization” in the format of Whitlam’s proposal. Singapore’s then-Prime Minister Lee Kuan Yew also dismissed the idea, stating that it “lack[ed] sensitivity.” Among other factors, a lack of prior consultation and sufficient detail on the proposal contributed to its rejection.

Kevin Rudd’s failed proposal for an “Asia Pacific Community” in 2008 suffered a similar fate. It would be a shame if future developments did not take heed of past events to allow for more cooperative outlooks on regional dynamics in the future.

There is some evidence of coalescence on the importance and potential of approaches that center on, or encompass, the Indian Ocean countries. Statements made at IORA – the only ministerial-level forum spanning the Indian Ocean – appear to support a shared vision for the Indian Ocean countries in terms of priorities and areas of cooperation. Yet a shared vision on the more wide-ranging concept of the Indo-Pacific is potentially more challenging to ascertain.

Former Foreign Minister of Indonesia Marty Natalegawa does not consider the idea of the Indo-Pacific to be incompatible with, for example, ASEAN, but suggests that focus should be on promoting peace and common security rather than policies of containment and alliances. As foreign minister in 2013, he suggested the “Indo-Pacific” as an approach for ASEAN. Ten years earlier, he had pushed for EAS membership to be broadened to include Australia, India, and New Zealand.

In a speech in 2016, the Indonesian ambassador to Australia stated that “a strong and resilient Indonesia-Australia partnership would provide a solid anchor for the Indo-Pacific region.” The concept is promising as long as Indonesia and Australia agree on its definition, purpose, and strategic importance. Sustained discussions between Jakarta and Canberra on the concept will be crucial.

Considering the “up-and-down relationship” between the two countries, consultation is critical to develop reassurance and understanding to work together in the Indo-Pacific. Whether we like it or not, previous events have downgraded Indonesian trust in Australia, and vice versa. Reassurance is needed to avoid any possible negative effects of ongoing policies and to ensure cooperation between the two countries. Reassurance is also critical for both countries to determine their stance toward future relations.

In the long run, it is essential to continue building deeper understanding between Indonesia and Australia; not only at the governmental level, but, most importantly, at the societal level. Although both nations have embraced democracy, it cannot be denied that their cultures remain different. Yet these differences do not need to preclude the development of mutual understanding and affinity. Better understanding is needed to build trust and empathy among the two nations. This would also prevent actions that could potentially jeopardize relations.

The White Paper is an encouraging start. An updated Australian strategy paper on Indonesia would help to unpack the implications of the Indo-Pacific for the relationship in more concrete terms. In this process, again, it is crucial that Australia and Indonesia (and indeed other partners) consult each other closely on the concept to ensure that Indonesia and Australia are on the same page, and can build a stronger and more equal partnership.

Laura Allison-Reumann is Visiting Fellow at the University of Indonesia. She is also a Research Associate at Nanyang Technological University, Singapore.

Eko Saputro is Deputy Director for Bilateral and Economic and Financial Cooperation at the Ministry of Finance of the Republic of Indonesia.