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Indonesia’s Dealmaker in a Trump-Led Asian Order

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March 15, 2017 18:30 EDT

Caught up in the South China Sea tensions between Washington and Beijing, Indonesia needs to rethink its foreign policy approach.

President Donald Trump’s administration has brought an increased probability of rivalry between the United States and China in the South China Sea. This has created a renewed sense of internal and external anxiety for Indonesia, which now requires a rethinking of President Joko Widodo’s (or Jokowi, as he is known) foreign policy approach.

Just prior to Trump’s inauguration, an op-ed credited to the Indonesian Coordinating Minister for Maritime Affairs Luhut Pandjaitan appeared in The Straits Times gesturing to the incoming US president that Indonesia was a friend. Luhut wrote that Indonesia belonged both to the “new geography of American power” under a Trump administration and to the “cartography of an Asia reshaped” by the rising powers of China and India. However, he emphasized that Indonesia, as a leading Southeast Asian country, did not want to pick sides and requested that Indonesia’s independent and active foreign policy be respected.

It is odd that it was Luhut expressing this position and not Wiranto, the coordinating minister for politics, law and security, responsible for the cooperation between the Ministry of Foreign Affairs and the Ministry of Defense, as well as the Indonesian armed forces (TNI), police, and State Intelligence Agency (BIN). Nor did it come from Foreign Minister Retno LP Marsudi or, more importantly, President Jokowi himself.

The article was presumably published in Singapore’s most-read English language newspaper as a deliberate signal to Indonesia’s regional neighbors and the United States that key decision-makers within the Jokowi administration remain anxious about the future of a Trump-led Asian order, particularly in the South China Sea.

The subtle message here is that Luhut has made something of a comeback since he was reassigned in last year’s ministerial reshuffle, which was widely viewed as a demotion to serve Jokowi’s 2019 re-election plans. Luhut, however, has re-emerged as Jokowi’s spokesman on important defense and foreign policy issues concerning the big powers and regional security partners. The extent of Luhut’s new political role—as a tactical domestic decision or a strategic one—will become evident if Jokowi sends Luhut abroad when he visits Washington or Beijing.

Changing Tides

Luhut’s outlook on Indonesia’s position highlights the country’s intention to navigate this new era of great power relations through the continuation of its non-aligned, independent and active foreign policy approach. The Jokowi administration’s policies, however, have made this an increasingly complex task.

Jokowi has encouraged closer ties with China, which is now the third largest direct investor in Indonesia, and possibly the largest foreign investor if Chinese-linked subsidiaries based in other countries are taken into account. Jokowi has looked to China for important infrastructure investment as the China-led Maritime Silk Road and Asian Infrastructure Investment Bank (AIIB) are viewed as complementary and an opportunity to secure funding for his developmental agenda.

On the other hand, Indonesia has also forged closer economic relations with the US. Following his congratulatory phone call with Trump, Jokowi revealed that the new US president claims to have many friends in Indonesia, as well as business interests. Jakarta’s economic relationship with the US will likely be strengthened by the resort development projects in Indonesia that directly involve President Trump’s conglomerate.

Likewise, the planned natural resource exploitation of the Natuna Islands archipelago exclusive economic zone (EEZ)—which overlaps with China’s nine-dash South China Sea claim—is in cooperation with the US firm ExxonMobil. The consortium consisting of Esso Natuna Ltd (an ExxonMobil affiliate) and PTT Thailand is currently negotiating a production sharing contract with Indonesia’s state-owned oil and natural gas corporation, PT Pertamina, with a plan to extract the 46 trillion cubic feet of recoverable hydrocarbon gas.

Rex Tillerson, former chairman and CEO of ExxonMobil and now secretary of state in the Trump administration, recently stated during his confirmation hearing that the US will have to send a clear signal to Beijing by stopping and blocking access to China’s seven artificial islands constructed in the southern part of the South China Sea. This has created a sense of anxiety that has reverberated across the region, demonstrated by the timely appearance of Luhut’s article following Tillerson’s confirmation hearing.

This threat is strengthened by the fact that ExxonMobil—under Tillerson’s leadership—was willing and capable of challenging China in a similar context by signing a production-sharing contract with Vietnam in 2009 that was knowingly in conflict with China’s nine-dash line.

While Tillerson has been required to step down from his chairmanship and CEO role at ExxonMobil and distance himself from ethical conflicts of interest, ExxonMobil’s growing interests in the South China Sea will no doubt be a consideration in Trump’s foreign policy deliberations regarding the region.

And given that there are projects in Indonesia linked directly to President Trump’s personal business interests, as well as key decision-makers within his administration, these have put Jokowi in a difficult position. Trump’s foreign policy will likely be tailored to serve “America first” at the expense of other countries in the region, such as the Sino-Indonesia bilateral relationship.

Uncertain Times

On the day of Trump’s inauguration, Indonesia announced it was boosting its police force on the Natuna Islands from 5,000 to 12,000 personnel, and upgrading the police command from a type-B force led by a one-star general to a type-A force led by a two-star general. Indonesia also plans to establish a mobile police brigade (Brimob) division in Natuna—a paramilitary police division tasked with anti-riot, counter-separatist and counter-insurgency duties.

The increase in national police presence is an attempt to strengthen the pre-existing military territorial structure that is currently the subject of ongoing modernization deliberations that could involve foreign defense financing. Indonesia has already agreed to increase defense spending to boost its military presence and improve defense facilities on the island, despite wide cuts to the annual defense budget.

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This is an effort to boost the deterrence effect of Indonesia’s armed forces following maritime incidents in the country’s EEZ with China in 2016. This demonstrates not only that there is a preexisting perceived external threat on Indonesia’s northern borders near the South China Sea, but the recent push for more police to reinforce the military structure is an indication of a perception that rivalry in the resource-rich area may also involve internal forms of subversion by external actors.

Indonesia’s perceptions of insecurity emanate from all fronts: Its archipelagic make-up, population size, cultural diversity and history of religious, ethnic and secessionist conflict have meant that internal threat perceptions have remained the dominant influence on foreign and defense policy, and a lens through which Indonesia continues to perceive its external environment.

To the north, Indonesia sees a rising Asian power incrementally expanding southward along the maritime domain, one that is also connected to the Southeast Asian mainland that stretches along its western flank to the Malay Peninsula. To the east is a global superpower under a very different leadership, with the projection capability to impact the region significantly, and one that has recently shown signs of challenging a rising China just north of its borders. To the south is a middle power with a history of confrontation and a close security ally of the US, as well as a strategic partner of Indonesia’s nearby western neighbors, Malaysia and Singapore.

Rhetoric by the commander of the Indonesian armed forces, General Gatot Nurmantyo, has centered around the fear of external powers using an “invisible hand” to capitalize on internal social challenges within Indonesia’s democracy. He has used the November 2016 protests against incumbent Jakarta Governor Basuki Tjahaja Purnama for alleged blasphemy as a prime example.

Gatot has interpreted Indonesia’s current internal social challenges as an opportunity for external powers to engage in a proxy-war in competition for Indonesia’s vast resources. He has referred specifically to the Five Power Defense Arrangements (FPDA) countries—the United Kingdom, New Zealand, Australia, Malaysia and Singapore—as well as the United States and his perceived threat from China.

Indonesia’s self-perceptions of internal vulnerability to external interference have also been recently articulated by Luhut. He has recently advised Australia not to interfere with Indonesia’s domestic issues, using the example of Papua. This comes after the recent incident between the two countries that resulted in the temporary limited suspension of some joint military language training programs following the use of politically sensitive material in an Australian joint training facility.

The New Man in Washington

Indonesia’s external threat perceptions are also likely to be influenced by the key appointments by the Trump administration. US Secretary of Defense James Mattis has previously made comments about political Islam being not in America’s best interest. The appointment of Pam Pryor—who was in-charge of faith and Christian outreach during Trump’s election campaign—to the State Department is a further sign that it will play an important role in assisting Trump’s pro-Christian policies that favor Christians within Muslim-majority countries.

Trump’s first major attempt at policy implementation to operationalize his anti-Islamic radical terrorism policy position resulted in the temporary travel ban on seven Muslim-majority countries, listing amongst other reasons the persecution of religious minorities as one of its criteria justifying the ban. While Indonesia was not among those banned, this policy move comes at a time when the country is experiencing increased levels of religious intolerance of minority groups.

It has been reported that it was President Trump’s chief strategist, Steve Bannon, who played a key role in designing and implementing the executive order empowering the travel ban. Bannon’s appointment is also not without controversy, as he has also made clear his position on Islam, previously stating that the US is in an “outright war against jihadist fascism.”

Bannon has also been recently appointed as a full sitting member of the Principles Committee of the National Security Council (NSC). This has placed him above the chairman of the Joint Chiefs of Staff and director of National Intelligence, who attend only on issues relating to their direct area of responsibility. This makes Bannon the most influential person in the Trump administration outside the president’s immediate family.

These developments are likely to be interpreted by some in Jakarta as a sign of an anti-Islamic ideological shift within the US government. Luhut has argued that the “demographic centre of gravity” of Islam lies in Indonesia, however, these appointments run contrary to Luhut’s judgment that the Trump administration will “likely adopt a non-ideological and non-confrontational approach to a diverse political world.”

Furthermore, Trump’s pro-Christian and anti-Islamic appointments come at a time when Islamic radical groups in Indonesia are utilizing the post-reformasi democratic space, amplified by the proliferation of social media, to raise the profile of political Islam on a mass domestic scale in Indonesia to achieve their political objectives. This is a clear push in the opposite direction in Indonesia—an ideological shift toward a greater role for political Islam within Indonesia’s democracy and something that could influence the Trump administration’s future perception of Indonesia.

The Jokowi administration faces a unique challenge in handling the important relationship with America under Trump’s unpredictable leadership, which so far continues to uphold the security of the current Asian order. He also faces the challenge of managing the economic powerhouse of China that now underwrites the much-needed investment capital to fund his developmental agenda, which is crucial to keeping Jokowi in power beyond 2019.

One small mishap could set off a chain of events that would force Indonesia to tailor its independent and active foreign policy to align both its security and economic interests more closely to the US or China. 

One small mishap could set off a chain of events that would force Indonesia to tailor its independent and active foreign policy to align both its security and economic interests more closely to the US or China. To avoid this alternative, Jokowi needs to avoid miscommunication and misunderstanding with these important powers and Indonesia’s regional neighbors. This will require a new approach in a Trump-led Asian order, one that allows Indonesia to leverage its strategic weight in Southeast Asia to secure both domestic and regional objectives in the run-up to the 2019 elections.

A New Role

This is why Jokowi chose Luhut as his spokesman over other significant portfolio ministers. Wiranto has a poor international reputation that limits Jokowi’s ability to get Indonesia’s message across without the risk of a backlash is the Western media, which is now designated an enemy of the current US administration. He is far more valuable to Jokowi as a legitimate domestic political actor to achieve domestic political objectives such as securing TNI support for Jokowi’s 2019 election ambitions.

Vice President Jusuf Kalla is unlikely to run in 2019, and this leaves a vacancy that needs to be filled by someone who has wide domestic support and the ability to influence the armed forces. Whether Wiranto will take this position is still unclear, however, the prep-work needs to be done for other possible contenders such as Gatot, National Police Chief General Tito Karnavian or Luhut himself.

In a new Asian order where US policy is announced in 140 characters on Twitter, defense issues are too important to be miscommunicated by outspoken TNI Commander Gatot Nurmantyo or Defense Minister Ryamizard Ryacudu—a lesson made clear by the poor handling of the recent bilateral incident with a close US ally: Australia. Gatot claims not to have been reprimanded over the issue after reports suggested he was given a warning by Jokowi.

This has required Luhut to reaffirm this political line, stating that Gatot and Jokowi have laughed off the matter. However, Gatot has been far more constrained in his remarks following the incident, and he is no longer seen wearing a white peci—a traditional male Muslim cap—when officially attending religious events. This is perhaps a subtle indication that he has toned down his nationalist Islamic zeal, at least for now.

Indonesian Foreign Minister Retno L.P. Marsudi will likely be focused on strengthening the Association of Southeast Asian Nations (ASEAN) as a key pillar of Jakarta’s “omni-enmeshment” strategy of managing great power relations. Poor regional leadership by Jokowi has resulted in declining influence of ASEAN in dealing with China. Jokowi’s policy considerations have been far more inward-looking than his predecessor Susilo Bambang Yudhoyono. This has prompted Indonesia’s leading strategic thinkers to call for a more reinvigorated leadership in ASEAN this year, as the region is expected to experience an ongoing strategic flux.

Another important task for the Foreign Ministry will also include building closer links with the South Pacific as part of Indonesia’s Look East policy, in an effort to offset the attempt of the United Liberation Movement for West Papua (ULMWP) to further gain influence among the members of the Melanesian Spearhead Group (MSG). This will likely require a diplomatic manoeuvring in combination with Australia—a bilateral relationship that requires a diplomatic effort and delicate handling on both sides, not to mention managing different interests in the South Pacific.

Retno is also a career diplomat without a business or military background, and she lacks the business deal-making experience that will be an essential skill in negotiating great power relations in a Trump-led Asian order. This will make her an unsuitable candidate for the task at hand in the eyes of Jokowi, and she is unlikely to be well received by the Trump administration, which will prefer to deal hand to hand on important regional defense and foreign policy issues.

This leaves Luhut. One of Jokowi’s close advisors, he’s a former military officer with an extensive well-regarded reputation and former ambassador to Singapore (another important regional US security relationship). He has held positions of trade minister and coordinating minister for politics, law and security, where he played an important role in settling tensions with China after last year’s maritime incidents. Luhut is also a fluent English speaker and a successful businessman with experience in deal-making and the politics behind it.

In a Trump-led Asian order, Jokowi’s choice is clear: He requires someone who can coordinate the coordinators as wells as their subsequent ministers. Jokowi needs an experienced dealmaker, not a deal-breaker who can think big, protect Indonesia’s interests, maximize Jakarta’s options and contain the costs: the art of the deal—the Indonesian way.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

Photo Credit: yorkfoto

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