Saturday, May 25, 2013

Indonesia-Australia relations are warm, but can the 'love' continue for Tony Abbott?

Ross B. Taylor
Despite the live-cattle debacle and the ongoing asylum seeker issues, bi-lateral relations between Australia-Indonesia are looking healthy at present.
The current warm and co-operative relationship between Indonesia and Australia is likely to be tested however, over the next 12 months as both countries face national elections that will see a new Indonesian president installed and, if the latest polls are correct, Tony Abbott finally achieving his dream of becoming Australia’s next prime minister.
The opposition leader’s 'dream' may however, be short-lived when amongst his immediate tasks will be a visit to Indonesia to inform them that his new government intends to implement their commitment to turn around asylum seeker boats and dump the hapless passengers back on our northern neighbour’s beaches.

This task won’t be easy, but if that seems daunting there are other challenges would await our new PM that may re-define the bi-lateral relationship for years to come.

When the PM and his foreign minister-most likely Julie Bishop-arrive at the Presidential Palace in Jakarta, probably in December 2013 or early 2014, they will be met by a president whose party has been ravaged by corruption scandals, and whose personal popularity is at an all time low. Sound familiar? They will also meet with a president who will be in 'caretaker' mode with the Indonesian national elections (then) only a few months away.
Susilo Bambang Yodhoyono - or SBY as he is known in Indonesia - has held a deep affection for Australia, but with his compulsory retirement in 2014, Australia faces a completely new ball-game; in politics, business and regional relations.

It is hard to guess exactly how this current president will react to a 'turn back the boats' policy given the ambivalence about asylum seeker issues by most Indonesians, but SBY will be keen not to agree to anything that may even further damage his already badly wounded party, and his own domestic reputation as a weak and ‘let’s do nothing’ leader.

Abbott knows only too well that the real challenge for his government will occur after the Indonesian elections when a new president is installed, and talk on the streets of Indonesia's capital, Jakarta suggests the charming but lethal Prabowo Subianto is a serious contender to lead Indonesia as from next year.

The former general and commander of the notorious Kopassus, that lead the attacks on the East Timorese independence movement in the early nineties, is currently on the banned entry list in the USA; a looming diplomatic challenge for the Obama government – and Australia - should Prabowo be elected in 2014

Probowo's style is similar to Suharto and is seen as very different to the perceived weakness of SBY by many kampung or 'village' people.

Prabowo would therefore, hardly take Australia's new 'boat' policy lightly and with thousands of asylum seekers waiting for any chance to head down to Australia, a belligerent response from a new Indonesian president could make the current crisis with boat people look rather benign.

Other candidates with a chance at the Indonesian presidency include Aburizal Bakrie, the  powerful billionaire whose company was responsible for a massive mud-flow in East Java several years ago that displaced thousands of people. Bakrie is despised by many Indonesians, and also disliked by elements within his own party, but he cannot be disregarded as a real possibility for president.

One bright-light for Australia however, lies in the recently elected governor of Jakarta; Joko Widodo. 'Jokowi' as he is affectionately known is a moderate with an underlying determination to get things done. He is highly respected by the 'man on the street' and is honest. Despite being relatively inexperienced in international affairs, 'Jokowi'
could be a good president – although more likely a vice-president - and one that Australia could work well with. He needs the support of a party with the numbers in the national parliament and this could possibly come from the PDI-P, headed by the former president Megawati Sukarnoputri.
If trade minister Gita Wirjawan throws his full weight into a run for presidency, then he would be another popular choice for Australia, but irrespective of who ends up as Indonesia’s president in 2014, Australia must accept that the elections will usher in a new and possibly a less certain era in our bi-lateral relations.
With Australia having to ‘tip-toe’ along the delicate regional path between economic loyalties to China and strategic loyalties to the USA, it will be critical to have a supportive and friendly Indonesia treading the same path.
A strong economy, a new found sense of being a respected world and regional player, a growing suspicion about Australia’s position on West Papua, and in business concerns about the IA-CEPA Free Trade Agreement will all be factors that will provide both Abbott and Bishop with much to consider in their desire to develop a close relationship with a far more confident, stronger and nationalistic Indonesia.

As we focus on the domestic events leading-up to our own federal elections in September, the evolving political environment in Indonesia will probably be hardly noticed by many Australians.

So as we board our next holiday flight to Bali, we should remember that the impact on all Australians of an emerging powerhouse with over 240 million people and a new, and possibly less accommodating president (to Australia) could challenge our perceptions of, and relations with, our near neighbour significantly.

Just ask Tony after his first visit.

Ross B. Taylor is the chairman of the WA-based Indonesia Institute (Inc). This article first appeared in 'The West Australian' Newspaper on 30th April 2013.

May 2013

Saturday, May 4, 2013

Trade & treaty contacts; or mates & neighbours?

Zulino Rizky Hafiz hopes to become an engineer.  His parents in Surabaya are among the new Indonesian middle class, flush enough to find $1,300 to send their high school son to Perth’s Tranby College for a fortnight. 

He’s been taking part in the Australian government and private enterprise BRIDGE programme linking schools on both sides of the Timor Sea. 

“I appreciated the informality of teachers and students feeling free to ask for help, though I didn’t like the way teenage boys and girls get so close,” the 17-year old said on his return. I never knew we had a neighbour so different.” 

The observations of the young Muslim were spot on.  The two countries need more than Canberra-imposed policy to span the gap, cooee close yet a cultural canyon apart, requiring hard work and political will to bridge.

Consider the differences:
Australians are mainly big, white, brash, irreligious, pragmatic and well paid.  We live in a nation where powers are separated and the rule of law rules. Don’t dare tell us who to worship. 

Indonesians are generally small, brown, restrained, religious, superstitious, exploited and poorly paid.  They live in a nascent democracy manipulated by moneymen and the military.  The state’s fingers are in every citizen’s dealings with the Deity.  

We’re eighth on Transparency International’s corruption perception index.  A year ago Indonesia ranked 100.  Now it’s 118. 

Our background is as recent transplants, Judaeo Christian, British democratic, colonial now multicultural. Our independence was granted amicably. 

Indonesia’s history is ancient with Hindu and Buddhist traditions, feudal, patriarchal and colonised.  Independence was bravely won after a four year brutal revolutionary war that still shapes the nation. 

For every one of us there are eleven of them. Population growth rate of just one per cent - sounds manageable?  Another baby was born while you read this sentence. 

We live in the Anglosphere. Our mates live far away in Europe and the US. Their friends are – well, we don’t really know, but fear they’re in the Middle East. 

Indonesians are on their own from cradle to grave.  Useless whingeing to the government. The welfare system is the family.  

We do all sports well on splendid public facilities. They play soccer badly and practise in the street.  

Our diet is dairy and grain, protein and booze. their staple is rice.  No grog. Even toilets are different.
How can such two such radically dissimilar cultures intersect peacefully?   

Friendship can’t be bought, but governments think otherwise.  So Australian taxpayers give around half a billion aid dollars a year.  Much is spent building schools, the proper role of the sovereign state. 

There’s no sign this generosity enhances understanding of the people next door other than reinforcing opinions about our wealth and their government’s failure to provide. 

The taxation directorate general says there are 60 million potential taxpayers - but only 20 million are listed and paying. Just half a million businesses are registered out of an estimated 22 million.  

How the Indonesian government gathers and uses its money (the military gets most) is not our business. A nation that can’t even dig taxes out of miners and is heading towards a $20 billion deficit is in no position to lecture.  But we can select our aid priorities. 

Indonesia’s education system is in crisis.  It’s at the bottom of the Pearson Study of 40 nations’ schools.  Bringing top chalkies to Australia to learn how to teach, write courses and run schools would be far more beneficial than paying Indonesian contractors to plaster walls.  

The BRIDGE project that helped open teenager Zulino’s eyes to Aussie culture pre-dates PM Julia Gillard’s Asian Century by four years.  So far it has attracted less than 100 school partnerships.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

We’ve been neighbors since Gondwanaland split. For much of that time we’ve viewed each other with suspicion laced with ignorance and travel warnings, inter-cut with moments of great generosity like our magnificent response to the Aceh tsunami and other natural disasters. 

Suddenly we’ve heard that they’ve got money.  That means they must need foods and goods, maybe even a few old Hercules. Hello, how can we help, how much can you pay? 

Are these the foundations for a good and lasting relationship? 

We want to join Asia but does Asia want us?  I haven’t heard anyone in Indonesia talking about the Australian Century.  Hillary Clinton launched its Pacific Century (that includes Indonesia) a year ahead of Ms Gillard’s statement. 

Australian leaders may be serious about an Asian Century where curious and open-minded youngsters can poke around their neighbor’s culture to erase prejudices. 

But it’s clear they haven’t got the Indonesians on the same page, as Erin McMahon’s piece makes clear. 

The Asia Century policy is a gentle shuffle forward and a welcome shift from the drivers of defence and security.  The hype makes it sound like a Southeast Asian version of the open border European Community that’s helped dissolve ancient hatreds and foster unity through people-to-people contacts.   

It’s not. But it should be.
Duncan Graham is a journalist and editor of the online blog, 'Indonesia Now' ).  An expanded version of this commentary first appeared in On Line Opinion.


It's time for a food revolution: Goodbye Pad Thai & Mongolia Lamb; hello Beef Rendang!

Australians are pretty well sold on Asian food. I think probably most Australians have a ‘go-to dish’ they order in Chinese, Thai, Vietnamese, and Japanese restaurants. But ask an Aussie what their favourite Indonesian dish is and they will most likely scratch their head and say in default, 'nasi goreng'.

As far as dishes go, nasi goreng is tasty enough, but there is a wealth of other dishes that, unbeknown to many Australians, are being cooked to drool worthy perfection in their neighbours warung (village) a few hundred miles West in Indonesia. In fact, I will go out on a limb and generalise here: most Indonesians can cook Indonesian dishes like Ramsey can cook a beef wellington or Oliver, a pasta!
I don’t know if I’ve just stereotyped the majority of the population into top chefs and created unspeakably high expectations, but it does seem like some sort of genetic transfer happens in the womb and Indonesian babies come out at least knowing how to prepare Indo Mie.
In Indonesia, one can pretty much go up to someone’s house and knock on the door with a twenty (thousand rupiah) and ask for the special. OK, that’s only half true. I don’t advise harassing complete strangers for authentic meals, but it’s absolutely OK if there is some sort of signage out the front of a house advertising ‘soto ayam’ or ‘nasi pecel’ for example.
To support my argument that all Indonesians can cook, I offer this as evidence: every second house is a kitchen. If you’re too lazy to cook lunch, or there’s no food in your fridge, just wander down the road and within about thirty seconds you will notice that people have turned their houses into restaurants. Enter through the garage and sit at a plastic chair and table or just order at the window and soon a steaming bowl of ‘sayur lontong’ will arrive.
It’s a mystery why Bali is the most visited tourist destination for Australians, and yet we have so few Indonesian restaurants in Australia. When I’m home I crave certain foods I’m use to eating in Indonesia-my home of the last six years-and actually I really crave my helper’s cooking. She’s been with my family more than four years and single-handedly made sure I try a cookbook of Indonesian dishes. Trust me, there’s at least another three editions I haven’t tasted; too much food, too little stomach space.
One of my favourites is, and this might sound unappetising, a firm block of peanuts and tofu, cut into rectangles and fried, called ‘tempe’. Every disbeliever I’ve made try it has seen the error of their ways. I don’t have particularly exotic tastes though, so there are many off-limits foods for me.
I’m not a seafood lover and I’m turned-off by meats if it looks ‘carcassy’ or gristly. So I’ve got my favourites which I return to again and again. ‘Lumpia’ is one of them - an Indonesian soft spring roll with carrot, chicken, potato and celery leaf inside a crepe made of egg and flour, fried, and served with sambal sauce or, as I like, sambal and soy sauce. I also love, as my helper calls it, ‘keju Indonesia’, or Indonesian cheese. It’s fried soft tofu. Of course gado gado has to be right up there, which is an Indonesian salad of bean sprouts, potato, cucumber, egg and fresh peanut sambal sauce.
So for any entrepreneur who is wondering how they can convince their local community that they need a fifth Thai restaurant within one hundred metres of the other four, how about using those 457 visas wisely and getting some Indonesians over to charm our Aussie taste buds?
Lauren Gumbs-May 2013

Wednesday, May 1, 2013

Australian & Indonesian companies overlooking shared opportunities

('The Jakarta Globe' Newspaper-Tuesday 30th April 2013)

Despite the recent economic performance of both our economies, the business relationship between Australia and Indonesia is still underweight — as evidenced by the trade and investment statistics — and yet we are neighbors with growing and complementary economies.
The opportunities are enormous for Australian business to take advantage of the strong future growth outlook for Indonesia.
This country’s growing urbanization, growing working-age population and growing economy need the goods and services produced by Australia. Indonesia is already Australia’s largest market for soft commodities including live cattle, wheat, sugar, cotton and soybeans. And Indonesia also has an urgent need to develop infrastructure in telecommunications, transport, power, ports, health and education and develop its services sector.
And Australia needs what Indonesia produces. For Indonesian business, there are opportunities to export to Australia manufactured goods, skilled labor services, oil and gas processing plants and food such as noodles and specialized tropical fruit. Indonesian investors are active in Australia, with interests in commercial property, mining and agriculture, but the level of investment could be higher.
So, despite these opportunities, it seems that business in both countries is overlooking the opportunities sitting right on their doorstep.
I propose three areas in which business and government in both countries can work together to develop closer relations:
Firstly, the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) provides a framework for greater engagement between the Australian and Indonesian business communities. It is as much about the process as it is about the outcome.
The scope of the IA-CEPA is much broader and more strategic than a traditional free trade agreement. IA-CEPA will be a new type of agreement that seeks to bring the two economies closer together, covering investment and industry cooperation; dealing with “behind the border” issues that frustrate business; and delivering significant capability transfer initiatives.
The process is important because when the commencement of negotiations was announced, it was made quite clear that there must be opportunities for Australian and Indonesian companies to directly participate in the framing of this agreement.
And this is happening. Last year, a Business Partnership Group was formed comprising the Indonesian Chamber of Commerce and Industry (Kadin), the Australian Chamber of Commerce and Industry, the Indonesia Australia Business Council and the Australia Indonesia Business Council.
The IA-CEPA BPG met three times during the year, consulted widely with the business communities in both countries and presented a joint position paper to ministers of trade of both countries last November.
This is the first time in Australia and Indonesia’s trade negotiation history that business in both countries has reached such an agreement before a trade agreement has been negotiated. This should rapidly advance negotiations.
The BPG report is extremely comprehensive and found that a successful IA-CEPA is expected to result in a significant increase in trade and investment between our two countries. The report also identified areas of opportunities and partnerships, not just barriers. It was agreed that the first area to be examined is that of a healthy diet: The objective is to increase the intake of protein in the Indonesian diet and to increase the consumption of tropical fruit in the Australian diet.
And that is why the IA-CEPA is more than just a typical bilateral trade negotiation — it requires imagination and innovation. It is not just about tariffs and quotas. The goal is to develop a partnership between two complementary economies operating in a global economy.
And it should be a dynamic agreement that continues to evolve as the economies develop and the issues change. It is also fundamentally important for business to continue to be involved.
Secondly, there is a critical need for a different approach to trade and investment promotion and facilitation. Despite the recent favorable media coverage, Indonesia is still not on the radar for many Australian businesses. And if it is, the perceptions do not match the reality.
There should be increased resourcing by both governments for more sophisticated market development and promotion. This should start by identifying the key opportunities in the global supply chain and then identifying where specific Australian and Indonesian industry sectors and companies can partner to capitalize on these opportunities.
The old days of generic trade missions are over. We need to have the economic development agencies more resourced and therefore able to take a more pro-active approach to assist business to identify opportunities and potential partners.
Thirdly, one of the fundamental ingredients to deepening the business relationship is education of our business leaders. The AIBC supports more resources for the teaching of Indonesian studies in Australia’s schools and universities and supports the Australian Opposition’s New Colombo Plan policy, especially as it involves educating Australia’s next generation of business leaders with practical work experience in Asia.
But we also need to educate our current business leaders. The AIBC has brought together executives from companies that have successfully invested in Indonesia and also executives from companies considering investing in Indonesia. The objective is to develop a “mentoring” or “buddy” relationship so that Australian companies can share experiences about what worked and what didn’t. This program promotes Indonesia as a business destination, encourages Australian investment and most importantly, educates Australian executives about the market sitting right on their doorstep.
I am sure there is scope for a similar program to be hosted in Indonesia for Indonesian executives to share their experiences about doing business in Australia.
If government and business in both countries work together on these three initiatives, it will go a long way to encouraging greater business engagement. But in the end, it is up to Australian and Indonesian business to look up and realize the many opportunities out there.

Chris Barnes - April 2013
Chris Barnes is a  former president and current national vice-president of the Australia Indonesia Business Council.