This Article is From Nov 10, 2010

China ups ante for Indonesia on eve of Obama's arrival

China ups ante for Indonesia on eve of Obama's arrival
Jakarta: Less than a day before President Obama touched down in Jakarta on Tuesday, a high-level Chinese delegation wrapped up a three-day official visit here by announcing that Beijing would invest $6.6 billion in desperately needed infrastructure improvements. The announcement's emphasis on roads, bridges and canals -- not to mention its timing -- laid down a not-so-subtle challenge to Mr. Obama: show your Indonesian hosts the money.

As the United States and China step up their rivalry in Southeast Asia, Indonesia -- officially hewing to a long-standing foreign policy of nonalignment but leaning closer to Washington -- represents by far the biggest prize in a region caught uneasily between China's rise and America's renewed engagement.

At a news conference here with his counterpart, President Susilo Bambang Yudhoyono, Mr. Obama said the United States was not interested in "containing" China. But a day after endorsing India's bid for a permanent seat on the United Nations Security Council in a move widely seen as an attempt to check China's growing influence, Mr. Obama poured on the charm.

The president, who spent four years as a boy here, sprinkled some Indonesian words in his speech and reminisced about daily life back then. More pointedly, he sought to align Indonesia with the United States on shared values, calling Indonesia a "critical partner" in ensuring Asia's prosperity "primarily because it is a country that has figured out how to create a genuine democracy despite great diversity."

American and Chinese officials have been pursuing all 10 countries in the Association of Southeast Asian Nations but none more aggressively than Indonesia, the world's fourth most populous nation, spread out across a strategically important, resource-rich archipelago and now led by a democratically elected government impatient to raise the country's international profile.

The United States will have to contend with challenges, old and new. Despite Indonesia's enduring suspicion of China, Beijing has been making great inroads here, economically, diplomatically and militarily. And a newly confident Indonesia has been reasserting its independent foreign policy, promoting what it now calls a "dynamic equilibrium" for the region.

"We want to maintain a strategic space from the rivalry between the United States and China," said Juwono Sudarsono, Indonesia's defense minister from 2004 to 2009. "We can navigate between that rivalry, from time to time giving out signals that both the United States and China are important to us, because if we align ourselves too closely, it would be detrimental to the core values of Indonesia's foreign policy."

Despite Beijing's efforts, Indonesia, like the rest of Southeast Asia, except Laos, Cambodia and Myanmar, remains closer economically and strategically to the United States, experts say.

"The Indonesians would never align explicitly with the U.S., but they would learn to play the game," said Carlyle A. Thayer, a professor at the Australian Defense Force Academy who recently released a study on the effects of the American-Chinese rivalry on Southeast Asia.

In July, the United States lifted a ban on cooperating with Kopassus, an Indonesian special forces unit implicated in past human rights abuses. That removed the last obstacle to normalizing military ties that had been suspended in the 1990s because of Indonesia's occupation of East Timor. The United States, which has provided Indonesia with $47 million in equipment to beef up maritime security, also co-hosted a nine-nation military exercise with Indonesia last year.

But United States policy in other parts of the Muslim world undercuts its appeal in Indonesia, the country with the world's largest Muslim population.

"As President Obama promised in Cairo more than a year ago, he said he wants to create new relations between the United States and the Muslim world based on mutual understanding and respect," said Din Syamsuddin, the chairman of Muhammadiyah [], one of Indonesia's two biggest Islamic social and political organizations. "But many of us, including myself, are still waiting for the materialization of his promises. We maintain our skepticism because the foreign policy of the United States in Afghanistan or Palestine has not really shown any change."

Meanwhile, Mr. Syamsuddin said, China has been reaching out to Muslim leaders in Southeast Asia. He himself was invited to meet Jia Qinglin, a member of China's ruling circle, in Beijing in May. Prime Minister Wen Jiabao had planned a visit this year, but had to cancel for domestic reasons.

Because of a failed 1965 Communist coup in Indonesia that is believed to have been backed by Beijing, Indonesia and China had no diplomatic relations until 1989. But trade between the two more than doubled from 2005 to 2009.

After a Strategic Partnership agreement in 2005, high-level military exchanges have increased, and Indonesian officers have trained in China. Under a series of agreements, China said it would provide Indonesia with technical assistance in building aircraft and ships, as well as help in producing weapons and ammunition.

But there has been almost no follow-through yet on those agreements, which instead allowed Indonesia to use the "China card" to pressure the United States into deepening military ties, said Ian J. Storey, an expert on Southeast Asian military issues at the Institute of Southeast Asian Studies in Singapore.

Still, Indonesia signaled recently that there were limits to how close it would get with the United States.

In September, Mr. Yudhoyono conspicuously skipped a meeting in New York between the United States and the Association of Southeast Asian Nations, or Asean, when Mr. Obama was seeking support in pressing China for a resolution to disputes in the South China Sea. Aides said Mr. Yudhoyono was too busy attending to domestic issues, but his absence was interpreted differently here.

"The Indonesian government felt that the U.S. was putting too much pressure on Indonesia and other Asean nations to choose sides," said Syamsul Hadi, a political scientist at the University of Indonesia.