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Amid tension, Pence visit a litmus test for US-RI ties

Indonesia will host United States Vice President Mike Pence in Jakarta today at a time when President Joko “Jokowi” Widodo finds himself in a difficult position vis-a-vis the US after a string of spats with major US corporations and the inclusion of Indonesia in a recent trade “hit list” issued by the US

Tama Salim and Rendi Witular (The Jakarta Post)
Jakarta
Thu, April 20, 2017

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Amid tension, Pence visit a litmus test for US-RI ties

I

ndonesia will host United States Vice President Mike Pence in Jakarta today at a time when President Joko “Jokowi” Widodo finds himself in a difficult position vis-a-vis the US after a string of spats with major US corporations and the inclusion of Indonesia in a recent trade “hit list” issued by the US.

The crushing defeat to Jokowi’s ally in Wednesday’s Jakarta gubernatorial election runoff is also likely to add fuel to an adverse situation as the setback will undermine Jokowi’s bargaining position with the US amid the President’s declining political clout.

In the past six months, Indonesia has wrestled with US mining giant Freeport McMoRan, demanding that the company divest 51 percent of its shares in its Papua-based gold and copper mine, and technology pioneer Google, demanding that the firm settle unpaid taxes worth more than US$400 million.

Indonesia also scrapped JP Morgan from its list of primary bond dealers after the bank’s research branch issued a negative report on the country in November.

As Jokowi is known to react defensively to assertive demands, a Cabinet member told The Jakarta Post recently that he had advised US officials to avoid cornering the President, particularly over the Freeport issue.

“Raising the Freeport issue in the discussion will only be perceived as pushing and dictating to the President,” said the official.

Freeport’s third biggest shareholder, Carl Icahn, currently advises US President Donald Trump on issues related to deregulation, raising questions about whether the US will seek to conflate American public policy with elite business interests.

“The style of the current US administration is to push, push and push to get their will and message across. That too will most likely be advanced by Pence in his visit to Jakarta,” said Dinna Wisnu, senior advisor to the Atma Jaya Institute of Public Policy.

Indonesia has recently found itself on the wrong end of Trump’s “America First” strategy, as Southeast Asia’s largest economy made it onto a list of 16 countries that have contributed significantly to the US’ accumulating trade imbalances.

Suzie Sudarman, an American foreign policy expert from the University of Indonesia (UI), goes as far to say that the results of the Jakarta gubernatorial election will heavily influence the tone of the discussions.

Anticipating that the Freeport saga will be on the table, Suzie warned of a “bullying and arm twisting” approach to sealing deals that will make President Trump seem like a President that can deliver on his promises.

“The Jakarta election will serve as a threshold to measure whether Jokowi has a strong-enough bargaining position [in relation to Freeport],” Suzie said.

She cited the case of Basuki “Ahok” Tjahaja Purnama, Jokowi’s political surrogate whose chance to lead Jakarta has dissipated, which may prompt the US to scan Indonesia’s political horizon for other likely allies, especially those that have existing business ties with the Trump dynasty.

Pence will be in Jakarta for two days. His visit will begin with a courtesy call on Thursday morning to Jokowi. This will be followed by bilateral talks with Vice President Jusuf Kalla.

Pence will then make his way to Southeast Asia’s largest mosque, the Istiqlal, to meet with religious leaders for an interfaith dialogue before meeting ASEAN Secretary-General Le Luong Minh in South Jakarta.

On Friday, Pence will attend a business forum at the Shangri-La Hotel before flying out to Australia.

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