Australia-Indonesia ties are still at bay despite a recent public show of restored defense relations and moves afoot to deepen economic ties
Indonesian President Joko Widodo’s official visit to Australia in late February was trumpeted for the full restoration of defense ties after a brief severance over hurt sensibilities. But Widodo’s off-hand remark and Canberra’s subsequent denial that the two sides are considering joint naval patrols in the South China Sea show that strategic ties between the two island-nation neighbors are still not well-coordinated.
Widodo’s remarks on possible joint patrols, notably around the Natuna Islands, an oil-rich maritime area in the southern reaches of the South China Sea that Indonesia contests with China, were first reported by The Australian newspaper in the lead-up to the leader’s trip Down Under. Widodo met with his Australian counterpart Malcolm Turnbull during the visit, where trade and security cooperation were discussed.
Australian foreign minister Julie Bishop said on March 6 that no such patrols are on the cards and that Widodo had essentially misspoke. At another meeting this week of the Indian Ocean Regional Association (Iora) held in Jakarta attended by Turnbull, Bishop said the two sides had discussed “freedom of overflight” and “freedom of navigation” in the wider South China Sea as opposed to more sensitive joint patrols.
Widodo’s remark raised the antennae of regional security analysts, who wonder if Bishop is running interference on an issue Canberra does not yet want made public for fear of irking China before the details are agreed and worked out. The analysts noted that Bishop’s corrective, reported widely in local media, came several days after Widodo left.
Widodo hinted at the contours of closed-door discussions when he said, “If there is tension like last year, it is difficult to decide but if there is no tension I think it’s very important to have the patrols together.” Widodo characterized strategic ties as “robust” while he was in Sydney.
Potential joint Australia-Indonesia patrols in the contested maritime area would be impactful on many fronts, as both Australia and Indonesia work to balance their US and China relations amid fast moving change, including new US President Donald Trump’s saber-rattling in the South China Sea.
Maritime cooperation, including in relation to counter-terrorism, sea security and trade, is an important component of Australian-Indonesia ties in view of their huge abutting coastlines and outlets to the Indian Ocean. While unspoken, the two sides have a shared interest in the Indian Ocean not becoming another theater for destabilizing geo-strategic competition.
“It is in our interests not to let the Indian Ocean be a place where major powers fight for influence and control,” said Desra Percaya, director general for Asia Pacific at Indonesia’s foreign ministry, at the recent Iora event.
Natalie Sambhi, an Indonesia and defense expert, said Widodo’s apparent desire for greater Australian involvement in regional maritime affairs was an important diplomatic gesture given that Canberra has no direct ties in any of the high-profile maritime disputes.
Sambhi said the joint statement produced from the Turnbull-Widodo meeting in Sydney included several “positive developments” on bilateral maritime cooperation, apart from the broached joint patrols.
Iora, however, is probably not the most optimal mechanism for Australia to expand its maritime reach. Lesser known than the Association of Southeast Asian Nations (Asean), Iora’s 20-year history has likewise been plagued by its inability to build consensus among its 21 mostly South Asian member states.
India and now Indonesia have recently, though arguably to little avail, tried to boost the organization’s strategic relevance as China begins to assert influence in the Indian Ocean. Turnbull was one of the few national leaders in the grouping to attend the Jakarta event. China has observer status to the group.
Australian-Indonesia strategic cooperation in maritime areas would arguably benefit from deeper trade and investment ties. For two large neighboring countries trade flows are low, with Indonesia ranking as Australia’s 12th largest global trade partner. Two-way annual trade is worth around US$11.3 billion, according to official statistics.
The broad bilateral relationship, which often runs on contradictory strategic and economic tracks, has been stunted by frequent diplomatic flare-ups, including the handling of boat people from the Middle East and South Asia and Jakarta’s 2015 execution of Australian citizens on drug-related charges more than a decade after sentencing.
The two sides started negotiations for a trade and investment promoting economic partnership nearly a decade ago but the talks cratered in 2013. They were resumed last March, with both sides anticipating a bilateral free trade agreement (FTA) could be signed as early as the end of this year.
Australian trade minister Steven Ciobo highlighted in a report last year Australian market opportunities in food, education and healthcare in Indonesia based on what he terms as “strong complementarities.” Widodo during his visit to Sydney called on Australia to drop all trade barriers to Indonesian paper and palm oil imports.
To be sure, it’s not a done deal yet. “Geo-strategic issues have dominated the Australian government’s thinking about and engagement with Indonesia,” said Ian Satchwell of the Perth USAsia Center. “Several attempts have been made to shift the focus towards economic relations, but in most cases these have been derailed by a geo-strategic incident.”
Indeed, both sides agreed last year to deepen counter-terrorism cooperation through stronger intelligence-sharing and cyber-security measures. Cooperation first began in 2002 after the Bali bombings, where over 200 people were killed, largely Australian tourists, in an attack orchestrated by Jemaah Islamiyah, an al Qaeda-linked terror organisation based in Indonesia.
Both now worry about Islamic State gaining a foothold in Indonesia, which remains one of Australia’s most popular tourism destinations. In February, the two sides also announced the establishment of an Australia-Indonesia Partnership for Justice Phase II, which will aim to enhance legal and police force cooperation.
“The development of cyber security cooperation and increased partnering in law and justice have been important developments,” said Indonesia security expert Sambhi. “Terrorists communicate and plan attacks online, so being able to intercept and monitor those activities in the cyber domain benefits both nations.”
The question ahead is whether deeper economic, counter-terrorism and cyber-security ties will translate into a more robust security relationship in maritime affairs. While both Australia and Indonesia share strong trade relations with China, both also look askance at Beijing’s rising assertiveness in the South China Sea, as Widodo highlighted in his call for joint patrols.
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