Indonesia’s foreign and domestic policies: balancing idealism with pragmatism

Updated On: Feb 02, 2007

Indonesia’s development of its foreign policy and build-up of its international profile appear to resume unabated this year.

At the January 30 forum of the Islamic Advisory Group (IAG), Foreign Affairs Minister Hassan Wirajuda proclaimed that the world is increasingly appreciating a new and democratic Indonesia to enable it “to pursue its active and independent foreign policy.”

The IAG was first forged between President Susilo Bambang Yudhoyono (SBY) and UK Prime Minister Tony Blair in March last year, aimed at countering radicalism and promoting sound relations and harmony between the Muslim world and the West.

A day later, Indonesia expressed such a commitment at the bilateral front when President SBY met with his Pakistani counterpart, Pervez Musharraf to discuss efforts to help settle the conflicts in the Middle East, namely those in LebanonIraq and Palestine.  A current concrete effort from Jakarta is the planning of a meeting between Palestine's Hamas and Al-Fatah leaders in the near future.

Questions remain however, as to how Indonesia should position itself and pursue its foreign policy, particularly in global forum and organizations such as the UN.  The current gaze is upon Indonesia’s role in the UN Security Council as a non-permanent member, and where the country has recently expressed its readiness to take part in a UN Political Mission in Nepal (UNMIN) to end a conflict between the Nepalese government and the Communist Party.

A recently-held seminar organised by the Indonesian Foreign Ministry recommended for the country to mix pragmatism with idealism on a case-by-case basis, in order to serve both national interests and international peace and security.

One of the panelists, veteran diplomat S. Wiryono, argued that Indonesia should be pragmatic, and align its decisions with “national priorities in the political and economic fields.” Otherwise, he said, Indonesia's public would question whether membership in the council is worth the effort.

The Jakarta Post’s Endy M. Bayuni, a fellow speaker, warned that “if we don't have idealism then we could fall into a double standard of behavior. The U.S. and other major powers can afford to apply double-standard politics because they have the capability to do so. We can't afford such policies.”

Rizal Sukma, an international relations expert at the Centre for Strategic and International Studies (CSIS), added that “Indonesia should also take the initiative rather than just responding to others' ideas. We must commit once we start an idea, however, because initiative without commitment can be seen as irresponsible.”

Perhaps as a sign of Jakarta heeding the way of pragmatism, the country’s recent visit to India led by Vice President Jusuf Kalla rendered defence cooperation as a key agenda. In particular, a member of the House of Representatives (DPR)'s Commission I, Hajrianto Y Thohari, said that India’s nuclear development plans to boost its economy and energy needs should be emulated. “It is high time for Indonesia to learn from India and make the latter a main partner in the defence cooperation," he said.

Further, to what extent has pragmatism informed Indonesia’s domestic policies? 

President SBY’s declaration of economic self-sufficiency has appeared to pay off. At his early-year speech at the State Palace on January 31, he reported that the government’s decision to accelerate its debt settlement of US$ 7 billion to the IMF last year has been a success, being four years ahead of the scheduled time.

Other accolades included the highest foreign exchange reserves of US$42 billion in the country’s history, in spite of the debt repayments. The government also managed to reduce the ratio between debts and GDP from 56.9 percent in 2004 to 48.1 percent in 2005 and to 42.1 percent in 2006. If the future target of 35 per cent or lower is attained in the future, “Indonesia can be free from the status of a country with big debts,” SBY added.

Finally, SBY summed up that "it is high time for us to design and decide our own economic programs by ourselves and freely and independently choose financial sources for our development without consultations with countries or international institutions grouped in the [Consultative Group on Indonesia] CGI forum.”Elsewhere, the country’s banks and global rating agencies are in agreement with SBY’s assessment. The central bank reported that the national economy had grown by 6.5 percent during 2006's final quarter, and produced an overall growth last year of 5.5 percent to provide a good springboard for even higher growth this year at between 5.7 and 6.3 percent. The progress was attributed to the revival of spending following the easing of inflation and interest rates, and the country's robust export performance.

Global rating agencies such as Fitch Ratings and Moody's Investors Service have raised Indonesia's debt rating outlook from stable to positive on improvements in the country's finances, and the government's efforts to address investor concerns about corruption and bureaucratic obstacles.

Yet, challenges remain for the country in on all economic, social and political fronts. Moody's Investors Service has recommended Indonesia to "accelerate efforts to build sustainable capital inflows in the form of foreign direct investment (FDI) as a preferred alternative to possibly volatile portfolio flows." Economists from Yogyakarta's Gadjah Mada University also indicated problems in the government's industrial development policies, resulting in persistent rates of open unemployment and poverty that may prevent the country from posting positive growth rates this year.

Indonesia’s bird flu fight, whilst picking up speed, has conceded the epidemic to be a national disaster. Jakarta’s February 1 deadline of the culling of its backyard chickens has also met with massive seasonal floods running through the East and South to affect around 10,000 people.

Additionally, the Poso conflicts reach a new level of urgency when the International Crisis Group last week warned that the island of Sulawesi could develop into a centre for jihad waged by Jemaah Islamiyah (JI) terrorists against the central government. Such a development, according to critics, arose in part from the police’s overly aggressive campaigns against Muslim militants, and which had widened what was a localised conflict into a regional jihad battleground.

Pragmatism, as well as the campaigns of peace and development behind Indonesia’s foreign policy idealism, should also be applied to the domestic context to solve its current woes.  (01/2/07)


Indonesia ready to take part in UN Mission in Nepal (Thai News Service, 25 January 2007)

Indonesia sends delegation to IAG Forum in London (Antara, 29 January 2007)

World appreciation for RI increasing (Antara, 30 January 2007)

Yudhoyono, Musharraf to discuss Middle East Conflicts in Jakarta (Antara, 30 January 2007)

India worth imitating in nuke industrial development: Legislator (Antara, 30 January 2007)

Fitch raises RI debt rating outlook on better finances (Jakarta Post, 30 January 2007)

RI told to mix idealism, pragmatism on UNSC (Jakarta Post, 31 January 2007)

Economist warns investment climate remains weak (Jakarta Post, 31 January 2007)

Economy set to move onto higher growth plane in 2007, says BI (Jakarta Post, 31 January 2007)

Rain in Bogor forces evacuations in Jakarta (Jakarta Post, 31 January 2007)

Police Intensify Efforts to Capture Militants from Indonesia’s Restive Poso Town (Global Insight Daily Analysis, 31 January 2007)

President: RI economy should not be taken hostage by huge debts (Antara, 1 February 2007)

Indonesia to declare bird flu a national disaster (Jakarta Post, 1 February 2007)