Comment: The new reality of Australia–Indonesia relations

Police officers stand guard as protesters throw eggs during a protest outside the Australian Embassy in Jakarta, Indonesia. (AAP)

The PM's stance on Australia’s phone tapping activities clearly prioritises domestic politics over Australia’s long-term security interests, writes Jeff Neilson.

Australia-Indonesia relations have managed to withstand several serious diplomatic crises over the years, from Australia’s involvement in East Timor through to the issues of Papuan asylum seekers and differing attitudes towards Indonesian-based people smugglers. However, the current tensions caused by revelations of Australia’s intelligence gathering activities in Jakarta are being played out on a rapidly shifting, and largely unchartered geopolitical canvas.

Tony Abbott’s unrepentant stance on Australia’s phone tapping activities clearly prioritises domestic politics over Australia’s long-term security interests. It is unclear whether he is fully aware of the high stakes game he is playing.

The perception many Australians have of Indonesia is of a third-world backwater nation ruled by an autocratic military dictatorship, whose diplomatic goodwill can be assured through lavish disbursements of foreign aid.

The reality is vastly different. The size of the Indonesian economy is now on par with Australia, and its growth rates are double those of Australia. Indonesia is a vibrant democracy and a regional superpower. It severed dependence on the International Monetary Fund soon after the Asian Financial Crisis in 1997 and has been fastidiously repaying loans to the World Bank as a matter of national pride.

While the Australian aid program is significant in some local areas and is genuinely appreciated following natural disasters, it represents less than 0.01 percent of Indonesia’s GDP.

Indonesia’s international relations are primarily focused towards ASEAN and the economies of East Asia. Unfortunately for Australia, we are much more reliant on Indonesia for our security and economic interests then they are on us.

Indonesia will hold national elections next year in what has become a hard fought, tense and much anticipated contest. The stakes are high. There is no political mileage to be gained by demonstrating closer relations with Australia and President Yudhoyono faces ongoing criticism for being too close to Western powers.

Our relationship with Indonesia has been strained in recent months by the Coalition’s uncompromising and unilateral approach to asylum seeker policy. Poorly-consulted public pronouncements about boat buybacks, towing boats into Indonesian waters, and paying intelligence agents were all interpreted as infringements of Indonesia’s national sovereignty. The spying revelations only served to trigger a crisis already in the making.

The recent spying revelations have caused serious egg on the face of the Indonesian President. In his measured public comments on Wednesday, President Yudhoyono appeared genuinely affronted at a personal level to this violation of trust. Many Indonesians find it is incomprehensible as to why Australia’s leadership should be unwilling to concede any political ground on this issue since this is a crisis of Australia’s making.

In terms of diplomacy, the substance of the spying revelations is far less pertinent than outward appearances and public loss of face. Jakarta has made it clear that it is the Australian response and not the action itself that is harming relations. Over the last week, Jakarta has made several conciliatory overtures to Prime Minister Abbott, suggesting a potential pathway through the crisis. These, however, have not been taken up adequately by the Prime Minister.

Should the Indonesians not expect the same respect, contrition and diplomatic finesse afforded to German Chancellor Angela Merkel by American President Barack Obama following a similar row between the US and Germany? Instead, the message is one of defiant self-righteousness and arrogance. The apparent inability to recognise the changing geopolitical realities in the region is at odds with the official government stance that our relationship with Jakarta would be the centrepiece of its foreign affairs policy.

Make no mistake – this is a game changer in terms of the Australia-Indonesia relations. Unless Tony Abbott makes a political concession soon, the issue is unlikely to disappear without exacting a serious toll in terms of long-term trust and cooperation between our countries. This is a toll that is clearly contrary to our long-term strategic interests in the region.

Dr Jeff Neilson is an expert on Indonesia from the University of Sydney's Southeast Asia Centre.

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