🇮🇩 Indonesia looks abroad for peace and investment

Hello friends!

Whoa, I don’t know how but I’ve dropped the ball on our maritime section this month. After catching up so in-depth with the Philippines earlier in the week, I thought we ought to turn out attention to Indonesia. So here are the major non-election stories out of Indonesia. It’s an odd week. Usually, we don’t have Indonesia so outward facing but the Palestine cause is very close to the heart of Indonesians and the government so there’s a lot to explore. 

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Okay, let’s go.

Mr Widodo Goes to Washington + a bit of a rant

(I hate when the Javanese naming convention is subverted by foreign media style guides, but sometimes you’ve got to go with the gag.)

It’s a “new era,” said US President Joe Biden when he met with President Joko Widodo in Washington DC last week. The pair talked about deepening the relationship and nickel, nickel, nickel. Honestly, there’s little to report about it with APEC the big beast over the weekend. (APEC is boring so we shan’t go into it.)

BUT. I am extremely unhappy with the reception Biden gave Jokowi when the Indonesian President conveyed his country’s desire to see a ceasefire in Gaza with the backing of the US. Speaking extremely carefully and deliberately, Jokowi called for an immediate ceasefire for the good of all involved. Biden essentially laughed this off, did not acknowledge the point and moved on to talk, clumsily, about climate change.

Jokowi told media back in Jakarta after he returned that he twice raised a ceasefire to Biden: “I believe they (the US government) will note what we have conveyed.” 

This, to me, underscores the heart of the US-Indonesia relationship. The US wants access to Indonesia’s enormous markets and it wants Indonesia as a regional ‘counterbalance’ to China. It does not want to hear — truly hear — Indonesia’s geopolitical views. The US and Biden have their own domestic pressures (I just read We Are Not One and I can’t stop talking about it), to be sure, but the balance is changing. Plus, I’m still salty on Biden dogging Asean.  

I don’t know. This is much broader and well outside of my remit, but watching how Indonesia and Malaysia (and, much quieter, Brunei) have operated since October, with the concerted reaching out and teaming up with Arab countries and other Muslim-majority states it just feels like something bigger is happening. And maybe it’s short-lived! Maybe today’s news of a brief truce will lead to something more lasting. Or maybe it won’t, and domestic pressures force some of the world’s largest emerging countries — especially Indonesia and Turkey — to grapple deeper with the fact that the old guard is still not listening. And then what happens? Everyone will still need Indonesia’s nickel eventually. 

The Indonesia Hospital

Foreign Minister Retno Marsudi has taken the cause with her to China, where she’s part of a group hoping to pressure the United Nations Security Council, on which China sits (duh), to call for a ceasefire. Retno has always been strident on Palestine, but the situation in Gaza has now hit very close to home with attacks on the Indonesia Hospital in the north of the strip. The hospital is operated by an NGO and was effectively put out of service last week after supplies ran out and healthcare workers were overwhelmed by demand, hospital director Atef al-Kahlout said. 

Healthcare workers in Jakarta have held mass prayers and demonstrations in an effort to pressure the Indonesian government to begin speaking in more emphatic terms — a rally cry Retno is open to, by the sounds of it. 

“Attacks on hospitals and healthcare workers constitute violations of international law … A total of 22 hospitals and 49 health centres were forced to stop operating in the Gaza Strip due to Israeli arrogance,” the Indonesian Medical Association and the Medical Emergency Rescue Committee said in a joint statement, as per Al Jazeera. Indonesia must “engage in firm diplomacy on the international stage to pressure Israel to cease its aggression in Gaza,” it added. 

It’s a very powerful image: the hospital is flanked by Palestinian and Indonesian flags with signs in both Arabic and Indonesian. A lot depends on the coming days, I suppose. 

The Rohingya arrive in Aceh

Around 1,000 Rohingya refugees have arrived by boat in Aceh in recent weeks, fleeing terrible conditions in the Cox’s Bazar camps in Bangladesh. Many are sick and starving, putting a sudden strain on resources across communities. “Since their arrival early this morning, we have coordinated with local officials in Pidie region to ensure the refugees are getting their basic needs, since they have been floating for many days on the sea,” Munawaratul Makhya, of the UN’s refugee agency UNHCR, told Reuters. 

The arrivals have divided Aceh, which has been a major contact point for Rohingya fleeing genocide in Myanmar, especially since 2017. “[Locals] felt hurt by the previous attitude of the Rohingya people, despite the fact that North Aceh was once the friendliest to them,” Murthala, a regional secretary in North Aceh, told media as reported by the Jakarta Post. Local administrations are struggling to find adequate emergency housing and supplies. 

Jakarta must do more, says UNHCR, under “universal humanitarian obligations.” Foreign Ministry spokesperson Lalu Muhammad Iqbal denied that, saying Indonesia never signed on and all accommodations made for Rohingya over the years had been in “kindness.” That kindness, he added, has been exploited by people smugglers. 

“​​Although Indonesia hasn’t ratified the 1951 Convention, it has ratified the 1974 Convention on the Safety of Life at Sea, which among its provisions requires the government to ensure that necessary arrangements are made for the rescue of persons in distress at sea around its coasts,” Usman Hasid, executive director of Amnesty International Indonesia, told media yesterday. 

There is an uncomfortable parallel made here, and shared with Malaysia, about both countries’ governmental response to Palestine versus Rohingya. How can either country credibly claim leadership on behalf of Palestine when Rohingya refugees are left to languish off the coast of Aceh or on the streets of Kuala Lumpur? That’s a big question many others are far, far better equipped to grapple with than I am, but the conversation is becoming louder in progressive circles in both countries and I’m very interested to see what happens. 

Still, that’s hardly something the communities of Aceh can solve. Emergency supplies are needed and with the UN struggling to get that done in Cox’s Bazar, let alone elsewhere, it’s a grim time ahead.

What’s up, Nusantara?

Indonesia’s new capital city project, Nusantara, isn’t pulling in the cash from foreign investors just yet, President Jokowi said this week. The government has received hundreds of Letters of Intent while spruiking the project on the busy multilat circuit in recent months but official contracts are yet to be signed. Jokowi isn’t too concerned, saying he’s focusing primarily on domestic investment at this stage. Nusantara Capital City (IKN) Authority financing and investment undersecretary Agung Wicaksono agrees. He told the Jakarta Post that domestic interest is coming in thick and fast. 

Agung also noted that Jokowi’s claim that nothing has come in yet isn’t totally accurate. Deals with the Marriott chain have been inked to develop hotels in the city and India’s Apollo Group wants to build the hospital. Institute for Development of Economics and Finance (Indef) executive director Tauhid Ahmad told the Jakarta Post that for foreign would-be investors, this isn’t too surprising. The market is undeveloped and punters are still waiting to see. 

Jokowi has tied his legacy to Nusantara which makes the whole thing much more fascinating than any old infrastructure project. With less than a year left of his presidency, all three potential successors have vowed to continue development. I wonder how much of that is due to his overwhelming popularity meaning candidates kinda have to stick with it, OR if they truly believe in the project. I assume that is also a boardroom consideration. 

Is this corruption case over-gassed?

A fantastic piece on the corruption case surrounding the state-owned energy firm Pertamina here from Straits Times’ Wahyudi Soeriaatmadja. Pertamina’s former chief executive Karen Agustiawan has been detained and is awaiting trial on corruption charges dating back to a 2013/14 decision to sign a 20-year LNG procurement contract with the US-based Corpus Christi Liquefaction. That came to fruition in 2019 when demand contracted and Pertamina sold some of the excess off to other firms. Wahyudi explains that through that sale, Pertamina booked a profit, but when demand went haywire in 2020 and 2021, it was losses all the way down. That, Wahyuudi writes, is what triggered the corruption investigation.

But, there’s not much to suggest the case has legs to it. It’s just business, experts say, and by going after Karen it could have the unintended effect of scaring off businesspeople in the private sector who are the exact types sought out for these executive roles. And it could scuttle future profits for Pertamina on the deal. Wahyudi notes that if Karen is convicted, the agreement could be dissolved by Corpus Christi.

Karen is standing her ground. In a letter addressed to President Jokowi and reported widely in September, she wrote: “I personally did not make any material gains, or immaterial gains, from the LNG procurement from Corpus Christi. The Corpus Christi transaction in fact has positioned Indonesia to have a source of gas supply from overseas through 2040 with a pre-agreed price below the global market price.”