Building U.S.-Indonesia Mutual Understanding Since 1994

The 2010 Indonesia – United States Comprehensive Partnership Conference

On March 2, 2010, the United States-Indonesia Society (USINDO) hosted a conference on the forthcoming United States – Indonesia Comprehensive Partnership in collaboration with Universitas Indonesia, the Indonesian Council on World Affairs (ICWA), Modernisator, and the Centre for Strategic and International Studies (Jakarta) (CSIS). The conference was the third in a series hosted by USINDO, two held in Jakarta and one in Washington, DC, which were designed to engage the public, private, and non-government sectors in both countries on areas of mutual importance and global significance for the partnership.

The first conference, held in Washington, DC on April 16 and 17, 2009, provided an opportunity to discuss a wide range of ideas for inclusion in the Comprehensive Partnership. USINDO hosted a second conference on October 6, 2009 in Jakarta. It brought some of Indonesia’s foremost thinkers and citizens together to discuss how government, private sector, and civil society can cooperate on substantive issues and programs for a new era of bilateral relations.

The third conference was held March 2, 2010 in Jakarta, and was organized by USINDO together with four distinguished Indonesian organizations and institutions. Based on the findings and recommendations from the first two events, this conference consolidated and elaborated on the themes identified by both countries as important to a renewed bilateral relationship, and where the role of public, private, and non-government sectors could have substantive impact in advancing programs and deepening the people-to-people relationship.

Opening remarks were made by Dr. Dino Patti Djalal, Special Staff of the President for International Affairs, who noted that the Comprehensive Partnership will require significant efforts on the part of both Indonesia and the United States. Dr. Djalal suggested that Indonesia must learn to focus on the bigger picture while the United States must respect Indonesia’s independence. He pointed out that a strong comprehensive partnership between the two countries will redefine the bilateral relationship for decades to come, and that for this reason it must be an opportunity-driven and profound relationship. “… it is time for us to deliver the vision of President Yudhoyono and President Obama for the comprehensive partnership with creativity and determination, so that the next ten, twenty, fifty years, the relationship will survive – beyond the presidencies, beyond the departments – and redefine the partnership between Indonesia and the United States.”

Deputy Minister of Education Dr. Fasli Jalal spoke on the development of education as an important component of the U.S. – Indonesia relationship. He noted that the two countries should collaborate on academic research and technology development as well as partner to share experiences and best practices for democracy and entrepreneurship. Dr. Jalal noted common challenges, such as ensuring sustainable development, and in supporting education to develop knowledge-based economies and societies.

Special guest and keynote speaker Dr. Emil Salim, a member of the Presidential Advisory Council, spoke on the topic “A New Model of Development: Biodiversity, Climate Change, and Higher Education.” Dr. Salim discussed the importance of championing a model of global development that would consider the political, economic, and ecological together. Indonesia and the United States should become leaders of such a balanced development model that also advances the bilateral U.S. – Indonesian relationship: this shall include political development by finding strength through diversity, economic development that incorporates social and environmental considerations, and an ecological focus that allows Indonesia’s resources to add value without exploitation.

Throughout the day, distinguished scholars, government officials, and leaders in business and civil society led panel discussions on the five following topics:

• Creative Solutions for Trade, Business, and Investment
• A Partnership in Higher Education
• Democracy and Interfaith Values
• Sustainable Forest and Peatland Policy
• Collaborations for Climate Change

Each of the five panels aimed to provide concrete recommendations on what Indonesian and American civil society, private sector, and governments can do together to deepen relations at all levels and work on issues of global significance.

In cooperation with the U.S. – ASEAN Business Council, the panel Creative Solutions for Trade, Business, and Investment: Unlocking the Benefits of Infrastructure Development was moderated by Shinta Widjaja Kamdani, Chair of Foreign Investment, KADIN and featured panelists Luky Eko Wuryanto, Deputy Chairman for Investment Planning BKPM, Peter Gontha, Chair of KADIN-KIKAS, Hadi Soesastro, Senior Economist, CSIS, Stuart Dean, President of Southeast Asia, General Electric Company, and Kevin Thieneman, President, Caterpillar Asia.

Panelists noted that Indonesia’s new initiatives call for infrastructure funding to be at two percent of GDP. They emphasized that there is much opportunity for collaboration on infrastructure development between the United States and Indonesia. For example, the United States is developing renewable energy resources and the technology for coal gasification, and Indonesia has a great interest in working on these projects. Significant liberalization of the main sectors for infrastructure investment is needed before investors – both foreign and domestic – will be willing to invest.

Panelists recommended that Indonesia develop five, ten and fifteen year infrastructure development plans, and that that broadband access be included under Indonesia’s definition of core infrastructure. Broadband also has strong potential for partnership between the United States and Indonesia, with collaborations to develop the hardware and software that work in developing countries with less access to electricity and lower rates of computer literacy. Panelists also recommended reforming investment laws so that disincentives to investment, such as non-transparent regulations, are removed and incentives such as tax holidays are introduced for both domestic and international firms, especially for projects outside of Java.

The panel A Partnership in Higher Education was moderated by Donny Gahral Adian, Lecturer, Department of Philosophy, Universitas Indonesia, and featured panelists Gumilar Rusliwa Somantri, Rector, Universitas Indonesia, F.G. Winarno, Rector, Atmajaya University, Terence Bigalke, Director of Education, East-West Center , Hawaii, David Merrill, President, USINDO, and Totok Suprayitno, Education Attaché, Washington DC, Ministry of Education.

Panelists noted that educational collaboration and exchange are foundations of the U.S.-Indonesian relationship, but that they have declined in recent years. Higher education partnerships should be an integral part of strengthening the people-to-people relationship under the forthcoming Comprehensive Partnership. Science and technology is a key component of this, as is developing and sustaining institutional partnerships between American and Indonesian institutions for research, faculty, and student exchanges.

In order to achieve the goals of increasing educational exchanges, research partnerships, and other areas for higher education collaboration, the panel recommended Indonesian universities focus on forming partnerships with institutions in the United States, including community colleges, with specific research and exchange goals. Universities should focus on longer-term partnerships such as 2+2 joint degrees. Indonesia and the United States should also expand student and faculty exchanges, which will build understanding and relationships between the two countries. Panelists also recommended that Indonesian universities focus more on teaching creativity and entrepreneurship as keys to modernization. Public-private partnerships were cited as ways to get beyond traditional funding sources for education and as examples of how other countries have developed research partnerships. Finally, a formal mechanism to oversee the deepening of the educational partnership was cited as necessary to set goals, resolve problems, and agree on priority sectors and disciplines.

The panel Democracy and Interfaith Values was moderated by Hariyadi Wirawan, Head of Department, International Relations; Associate Professor, Universitas Indonesia, and featured panelists Bahtiar Effendy, Dean of Faculty, Social and Political Science, UIN Syarif Hidayatullah, Franz Magnis-Suseno SJ, Professor, Driyarkara School of Philosophy, Gerald Hyman, Senior Adviser and President of Hills Program on Governance, Center for Strategic and International Studies (Washington DC), and Ignas Kleden, Chair, Komunitas Indonesia Untuk Demokrasi.

Panelists discussed a key component of the people-to-people relationship of the comprehensive partnership: shared values of democracy and interfaith understanding. Panelists noted the importance of religious tolerance to democratic development in both countries. Both Indonesia and the United States are large, multicultural, and multi-religious nations with a shared commitment to equality, and have much opportunity for partnership based on shared principles. Comments from the audience noted that limited knowledge of Indonesia in the United States has resulted in policy that at times causes tension and lacks nuance. Similarly, panelists noted that Indonesia has a valuable role to play when it comes to sharing its experience of democratic transition and consolidation. Indonesia is free of the baggage carried by many Americans when trying to support democracy elsewhere in the world, and has important experiences to share from its own transition and consolidation.

Recommendations from the panel also focused on ways to deepen the people-to-people relationship, fundamental to shared values. Increasing exchanges, student and otherwise, is important, as is continued government sponsorship of socio-cultural exchanges not limited to “moderates.” Cultural understanding was cited as in need of expansion, which can be supported for example through the translation of Indonesian publications into English, particularly works by Muslim intellectuals.

The panel Sustainable Forest and Peatland Policy was co-organized by the Center for International Forestry Research (CIFOR) and was moderated by Daniel Murdiyarso of CIFOR. Panelists included Rachmad Witoelar, Executive Chair of the National Council on Climate Change, Adam Schwarz, Senior Advisor, McKinsey & Company, Singapore, Kristell Hergoualc’h, CIFOR, I Nyoman Suryadiputra, Director, Wetlands International, and Wandojo Siswanto, Indonesia’s Minister of Forestry

Panelists discussed the emerging role of sustainable forest and peatland management to promote rural economic development while reducing net carbon emissions from both Indonesia and the United States. Indonesia is the world’s third largest emitter of greenhouse gases, largely due to over 20 million hectares of peatland that cover 10% of Indonesia’s land surface. Peat-swamp forest conversions have been the single largest source of Indonesia’s greenhouse gas emissions. President Yudhoyono has pledged to reduce Indonesia’s carbon emissions by 26% by 2020 through sustainable forest/peatland management, including fire prevention, re-wetting peatlands, curbing illegal logging, reducing deforestation and land degradation, and developing carbon sequestration projects in forestry and agriculture. However, at present Indonesia does not have a specific policy designating peatland as protected lands.

Noting that now is the time to consider this vulnerable ecosystem as a part of both U.S. and Indonesian national strategies to reduce emissions, panelists recommended research on how to quantify the carbon cycle in tropical peatlands so they can become part of global mitigation efforts and qualify for financing opportunities. Panelists noted that Indonesia should strengthen forest designation to secure forest areas, rehabilitate degraded forest, manage fires, conserve biological diversity, revitalize forest industries, empower indigenous people and local
communities, and strengthen forest institutions. Finally, community participation on peatland restoration was cited as a key need to be combined with integrative sustainable alternative livelihoods development.

The panel on Collaborations for Climate Change: Opportunities for Sustainable Development featured moderator Fitrian Adriansjah, Program Director for Climate and Energy, WWF Indonesia, and panelists Moekti H. Soejachmoen, Executive Director, Pelangi, Diyanto Imam, Country Director, New Ventures Indonesia, Arian Ardie, Chief Operating Officer, Terrasys Energy; Governor and Chair of Power Committee, American Chamber of Commerce – Indonesia, and Susiyati B Hirawan, Independent Commissioner, PT. SMART Tbk.

The panel discussed the potential for market-based solutions to address climate change and promote sustainable development through U.S. – Indonesian cooperation. Both the United States and Indonesia can collaborate to reduce greenhouse gas emissions through innovative policies and in areas of cooperation that combine economic growth with the urgent need to combat climate change. Panelists discussed the role of the NGO sector, the impact of small and medium sized enterprises (SMEs), as well as opportunities for innovation and investment in science and technology.

Panelists focused on areas of cooperation where stakeholders in the United States and Indonesia – small businesses, NGOs, government ministries, institutions – can work together as partners. They recommended that the United States and Indonesia collaborate on R&D, in particular in agriculture and clean energy, through joint publications, trainings, and fellowships for researchers and policymakers. Additionally, panelists recommended that sustainable SMEs be integrated into the formal economy through business workshops for start-ups to guide entrepreneurs, focusing on business strategies, technical assistance, market access, and networking. U.S. companies in Indonesia can set the stage by integrating climate change mitigation into their operations and demonstrating that corporations can profit from carbon credits. The governments can provide selective incentives for more sustainable practices, and the Indonesian government was encouraged to develop an investment framework for renewable energy, including a national renewable energy inventory, carbon footprint inventory, REDD framework, validated measurement of greenhouse gas levels, maps to evaluate coastal resources, wind energy, and SME potential.