Obama’s Missed Opportunity in Indonesia

When Barack Obama decided on March 18 to postpone--again--his planned trip to Indonesia, Australia, and Guam, leaders in the region offered the expected murmurs of understanding, realizing that Obama has staked his presidency on passing healthcare reform. But beneath the surface, many Indonesian leaders resented the snub, and anti-American politicians in the archipelago will use the postponement to chastise President Susilo Bambang Yudhoyono for banking on improved ties with Washington.

The Indonesians have reason to be upset: Though the Obama administration has vowed that the United States will reengage in Southeast Asia after years of neglect by the Bush and Clinton administrations, it cannot even get the president to visit the largest and most powerful country in the region.

Obama has vowed to reschedule his Indonesia trip for June, but some administration officials privately suggest that this is hardly a lock--the trip could wind up being postponed indefinitely. That would be a major mistake. Postponing now has offended Indonesians and armed some of the opponents of President Yudhoyono. Postponing again would throw away a vital chance for a new U.S.-Indonesia relationship.

The opportunity is there. A Pew Global Attitudes Project poll last year showed an impressive Obama effect: More than 60 percent of Indonesians gave a favorable impression of the United States, up from 15 percent in 2003. But beyond the hype, Obama has a real opportunity to radically reshape--and upgrade--the U.S. relationship with Indonesia, the biggest power in Southeast Asia, an emerging global power, and a country not only winning its own war on terror but also creating a striking example of successful democratization.

Most presidents get one opportunity during their tenure to reshape U.S. relations with a major power: Bush built a new partnership with India; Clinton tried to re-envision Washington’s ties with post-Soviet Moscow. For Obama, Indonesia could provide that opportunity. Obama’s popularity in Indonesia will help, but the changing political situation in Indonesia also has created the chance for a new relationship with the United States.

As Indonesia’s democracy stabilizes, reformers in its political class are beginning to build ties to the United States, and not just engage in the reflexive anti-Americanism of the 1980s, 1990s, and early 2000s. What’s more, fears in Indonesia of China have led many Indonesian strategic thinkers, both in and out of government, to welcome a deeper relationship with Washington. While other nations in the region, like Thailand, clearly want to build closer relationships with China, Indonesia’s leadership--and its public--are far more skeptical. That is in part because of a tense history with Beijing, and in part because most Indonesian entrepreneurs, unlike their Thai counterparts, have little experience in and understanding of China.

Indonesia’s Progress

Indonesia’s domestic changes also add to the opportunity for real change in the relationship. The country’s turnaround has been among the most dramatic in the world. Only a decade ago, in the wake of Suharto’s downfall and the Asian financial crisis, which devastated Indonesia’s economy, rioters rampaged through Jakarta and other cities; separatist movements caused havoc in Aceh and Papua; and inter-ethnic and inter-religious violence sparked massive bloodletting in places like the Maluku Islands.

At the time, Islamist parties and Islamist networks also seemed on the rise. In 2002, Jemaah Islamiah launched the devastating Bali bombing, which killed over two hundred people, following on the heels of multiple JI bombings in Jakarta in 2000. Islamist parties and boarding schools seemed to be gaining in popularity. The Indonesian government appeared to be in denial about its domestic terrorism problem: then-President Megawati Sukarnoputri said virtually nothing about the terror threat. Her vice president, Hamzah Haz, denied Indonesia had a terrorism problem and famously celebrated the 9/11 attacks in America as a chance to "cleanse America of its sins."

Indonesia has begun to right itself under President Yudhoyono, a former general known as SBY, first elected in 2004 and reelected last summer. SBY has overseen a program of political devolution to local areas, critical in such an ethnically and regionally diverse country. Though a slow-moving, consensual politician, SBY has allowed the national anti-corruption investigators to go after anyone, including close associates and family of the president. He also has seeded his cabinet with reformers, like Finance Minister Sri Mulyani Indrawati.

The president’s counterterrorism strategy also has proven effective. Combining elite police work with an effective program to rehabilitate former jihadis and an adherence to the rule of law, the SBY administration has managed to convince the Indonesian public to support the battle against terrorism, while simultaneously taking apart the Jemaah Islamiah network, arresting most of its senior figures.

The Indonesian economy, too, appears to be rebounding, though it still faces serious challenges in trying to regain competitiveness against China and Vietnam, and serious obstacles to foreign investment including graft and lack of coordination among Indonesian ministries. According to a recent estimate by Indonesia’s central bank, the country could grow by as much as six percent in 2010, one of the highest figures in the region, as Indonesian consumer spending recovers, partly because of the stronger political climate. The Indonesian government also has vowed to double spending on infrastructure, to $140 billion, over the next five years, according to a report by Bloomberg News.

Obama’s Critical Issues

To keep the momentum going until June, the Obama administration should roll out elements of the new U.S.-Indonesia Comprehensive Partnership in advance of the president’s trip--and then make sure he actually gets to Jakarta. This comprehensive U.S.-Indonesia partnership could include: closer counterterrorism coordination and military-military relations including U.S. training for Indonesian Special Forces; supporting Indonesian leadership on difficult regional issues like the political stalemate in Myanmar, piracy, and pandemic disease; a framework for much greater U.S. investment in Indonesia and for Indonesia to provide more incentives for investment; regular bilateral dialogues between senior officials; and other aspects.

To get there, Obama first will have to offer Indonesia far greater respect than it previously has enjoyed--a job he has now made harder by canceling on Yudhoyono. The Obama administration has begun to devote more resources to cultivating senior Indonesian leaders. It should continue in this direction, making Jakarta its first stop on any Southeast Asia trip by top U.S. officials before June, and by publicly looking to Indonesia first to handle regional challenges like the stalemate in Myanmar. U.S. officials should also seek to boost trade with Indonesia. With the United States seeking to double exports, Indonesia--a relatively underdeveloped market for U.S. goods--offers a key opportunity, provided that Jakarta takes real steps to address rampant graft, a lack of policy coordination, and anti-investment sentiment among many local politicians.

The Obama administration certainly has talked big. Last year, Secretary of State Hillary Clinton vowed that, after years of neglect, "the United States is back in Southeast Asia." This week, Obama skipped a chance to make good on that boast. In June, he shouldn’t strike out again.