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Indonesia wary of novice Democrats' protectionist slant

There will be no dramatic changes in Japan's foreign policy toward Indonesia and other ASEAN countries after the historic victory of the opposition, the Democratic Party of Japan (DPJ), in Sunday's elections, analysts said Monday

Ary Hermawan (The Jakarta Post)
Jakarta
Tue, September 1, 2009 Published on Sep. 1, 2009 Published on 2009-09-01T12:46:23+07:00

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T

here will be no dramatic changes in Japan's foreign policy toward Indonesia and other ASEAN countries after the historic victory of the opposition, the Democratic Party of Japan (DPJ), in Sunday's elections, analysts said Monday.

But they also said the DPJ's socialist roots and political need to take populist actions had inevitably raised apprehension as to whether the country's newly elected government would be capable of avoiding protectionism that would affect its trade relations with other countries.

"Relations between Indonesia and Japan have been very strong. After all, there are many Japanese companies already operating in the region. Japan will benefit more from a free-trade agreement," Syamsul Hadi, a lecturer in interna-tional relations at the University of Indonesia, told The Jakarta Post on Monday.

Indonesia and Japan celebrated a golden jubilee in diplomatic ties last year with the visit of Japanese Prince Fumihito Akishino to Jakarta, followed by the implementation of the Economic Partnership Agreement (EPA), under which the two nations agreed to remove tariff barriers to boost bilateral trade.

The Indonesian government said Monday it welcomed Sunday's democratic and peaceful electoral process in Japan.

Indonesia respects the choice of the Japanese people and congratulated opposition leader Yukio Hatoyama and his party for winning the election, Foreign Ministry spokesperson Teuku Faizasyah said.

Japan is an important partner for Indonesia, he said, adding that Jakarta was determined to develop bilateral relations with Tokyo.

Dewi Fortuna Anwar of the Indonesian Institute of Sciences (LIPI) said it was difficult to foresee any possible fundamental change in Tokyo's approach to the United States, China and the ASEAN bloc, but there was an indication the crisis-hit Japan would prioritize improving its domestic industry to revive its economy.

"What matters is the way the government deals with the economic downturn," she said.

"Japan is our major investor and a major market for our exports. Are they going to shift their investment destinations? Are they going to be more closed?"

Japan remains the biggest investor in Indonesia, although Japanese investors' interests have gradually declined in the past few years mainly because of China's economic growth and Indonesia's unconducive investment climate.

The global downturn has also affected bilateral trade, which plunged by 43 percent in the first five months of this year.

Hatoyama, who is set to replace disgraced Liberal Democratic Party's leader Taro Aso, has criticized the LDP's market-friendly reforms, which he said worsened the social and income gaps and have been blamed for sinking Japan deeper into recession.

Hadi said it was likely Japan would focus its foreign policy on bolstering relations with China, South Korea and Russia, while trying to become more independent in its dealings with the United States.

"There are people who were formerly members of the socialist party inside the DPJ. I assume that Japan's liberal platform in its political economy will fade slightly," he said.

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