AMBASSADOR CALLS ON JUSUF KALLA

C O N F I D E N T I A L SECTION 01 OF 03 JAKARTA 004285

E.O. 12958: DECL: 12/05/2011
TAGS: PREL EAID PGOV ID
SUBJECT: AMBASSADOR CALLS ON JUSUF KALLA


1. (U) CLASSIFIED BY POLITICAL OFFICER ANDREW T. HINTZ FOR
REASON 1.5 B, D.


2. (C) SUMMARY: THE AMBASSADOR TOLD PEOPLES' WELFARE
COORDINATING MINISTER YUSUF KALLA ON NOVEMBER 30 THAT THE
U.S. WANTS TO HELP INDONESIA SOLVE SEPARATIST AND OTHER
CHALLENGES. KALLA SAID RECENTLY PASSED AUTONOMY LAWS WOULD
ADDRESS MOST SEPARATIST DEMANDS, BUT THAT INGRAINED DISTRUST
WOULD BE HARD TO OVERCOME. THE AMBASSADOR PRESSED KALLA ON
COMBATING EXTREMIST GROUPS LIKE LASKAR JIHAD (LJ). KALLA
SAID THAT LJ WAS NOT ENTIRELY TO BLAME FOR RELIGIOUS
CONFLICTS; HE SAID THE GOI HAD FORMED A MULTI-SERVICE JOINT
BATTALION TO QUELL FIGHTING IN THE MOLUCCAS. KALLA SAID TO
FIGHT POVERTY THE GOI SHOULD FOCUS ON WEALTH DISPARITY, WHILE
CHANNELING FOREIGN INVESTMENT TOWARD PRIVATIZATION OF
STATE-OWNED ENTERPRISES. KALLA SAID THE GOI SUPPORTS THE WAR
ON TERRORISM, AND THAT HE PERSONALLY HAD DEFLECTED CRITICISM
OF THE US-LED MILITARY CAMPAIGN IN AFGHANISTAN. KALLA IS A
THOUGHTFUL INTERLOCUTOR, BUT HIS COMMENTS BETRAYED A
RELUCTANCE (COMMON AMONG INDONESIAN OFFICIALS) TO ADDRESS
ACCOUNTABILITY ISSUES IN RESOLVING SEPARATIST AND SECTARIAN
CONFLICTS. END SUMMARY.

US SUPPORT FOR INDONESIA AFFIRMED
--------------


3. (C) DURING HIS NOVEMBER 30 INTRODUCTORY CALL ON PEOPLE'S
WELFARE COORDINATING MINISTER YUSUF KALLA, THE AMBASSADOR
STRESSED US SUPPORT FOR INDONESIA'S NATIONAL INTEGRITY. THE
AMBASSADOR NOTED THAT THE USG HAS CONSISTENTLY CONVEYED ITS
SUPPORT FOR A UNITED INDONESIA TO SEQRATIST GROUPS LIKE THE
FREE ACEH MOVEMENT (GAM). THE AMBASSADOR OPINED, HOWEVER,
THAT THE PEACE PROCESS IN WEST PAPUA IS MUCH FURTHER ALONG
THAN IN ACEH. HE NOTED THAT THE REGIONAL AUTONOMY
LEGISLATION FOR PAPUA WAS FAR MORE INCLUSIVE THAN THAT FOR
ACEH THANKS TO THE PAPUAN PUBLIC'S BROADER INPUTS IN THE
DRAFTING PROCESS. THE AMBASSADOR OBSERVED THAT, IN ACEH, GAM
HAD DRIVEN THE DEBATE EVEN THOUGH GAM DOES NOT FULLY
REPRESENT THE ACHENESE PEOPLE.


4. (C) THE AMBASSADOR ALSO STRESSED THAT, WHILE UNWILLING TO
BECOME DIRECTLY INVOLVED IN MEDIATING SEPARATIST CONFLICTS
LIKE ACEH, THE U.S. IS KEEN TO HELP INDONESIA RESOLVE SUCH
ISSUES PEACEFULLY. THE AMBASSADOR ADDED HE WAS TROUBLED BY
REPORTS THAT THE GOI WAS POISED TO PURSUE A MILITARY SOLUTION
IN ACEH, WHERE INDONESIA WAS SAID TO BE DEPLOYING SEVERAL
EXTRA BATTALIONS OF TROOPS. HE ADVISED KALLA THAT THE
POLICE, AND NOT THE ARMED FORCES (TNI),SHOULD HAVE THE LEAD
IN RESTORING ORDER IN THE PROVINCE, AND NOTED THAT THE US
COULD HELP STRENGTHEN POLICE CAPABILITIES THROUGH ITS LAW
ENFORCEMENT ASSISTANCE PROGRAMS.

KALLA SEES SALVATION IN LEGISLATION
--------------


5. (C) WHILE ADMITTING THAT INDONESIAN NATIONAL UNITY IS
THREATENED BY SIGNIFICANT CENTRIFUGAL FORCES, KALLA SAID THAT
VARIOUS REGIONAL AUTONOMY BILLS NOW BEFORE PARLIAMENT WOULD
ADDRESS MOST SEPARATIST DEMANDS. HE ADDED THAT THIS WAS
PARTICULARLY TRUE FOR ACEH, WHERE HE CLAIMED THE DRAFT LAW
ACCOUNTED FOR ALL SALIENT ISSUES, INCLUDING REVENUE SHARING
AND IMPOSITION OF ISLAMIC (SYARIAH) LAW (HE NOTED, HOWEVER,
THERE STILL IS NO CLEAR DEFINITION OF THE LATTER). KALLA
NEVERTHELESS CONCEDED THAT, IN THE CASE OF ACEH, A NEGOTIATED
SETTLEMENT MIGHT BE STYMIED BY AN ACUTE LACK OF TRUST ON BOTH
SIDES. HE OPINED THAT THIS WOULD BE NO LESS TRUE OF THE
POLICE, WHOSE HARDLINE MINDSET, HE BELIEVED, WOULD TAKE
CONSIDERABLE TIME TO CHANGE.


6. (C) AGREEING WITH THE AMBASSADOR'S VIEW THAT GAM DOES NOT
TRULY REPRESENT THE ACEHNESE PEOPLE, KALLA DESCRIBED MANY OF
GAM'S MEMBERS AS RADICALIZED WAR-ORPHANS WHO HAVE TURNED TO
BANDITRY UNDER THE GAM BANNER. KALLA SAID THAT, BY CONTRAST,
THE PAPUANS ARE NOT COMMITTED TO ARMED STRUGGLE, BEING LESS
EDUCATED AND ENJOYING A RELATIVELY EASY LIFESTYLE. HOWEVER,
HE DISMISSED REPORTS OF AN INCREASE IN TNI DEPLOYMENTS TO
ACEH AS "DISINFORMATION," NOTING THAT, GIVEN DEPLOYMENTS
ELSEWHERE, THE FIGURES OFTEN CITED WERE IN EXCESS OF THE
TOTAL NUMBER OF BATTALIONS FIELDED BY TNI.

IDPS AND LASKER JIHAD
--------------


7. (C) IN RESPONSE TO THE AMBASSADOR'S QUERY ON THE GOI'S
PLANS FOR HANDLING THE CHALLENGE POSED BY INDONESIA'S 1.3
MILLION INTERNALLY DISPLACED PERSONS (IDPS),KALLA NOTED THAT
IDPS RESULTED OF THREE TYPES OF REGIONAL CONFLICT: ETHNIC,
RELIGIOUS, AND POLITICAL. THE MINISTER SAID THAT, WHILE ALL
WERE DIFFICULT TO RESOLVE, RELIGIOUS CONFLICTS POSED THE
GREATEST PROBLEMS BECAUSE THEY GENERALLY OFFERED LITTLE
COMMON GROUND FOR COOPERATION AND RECONCILIATION. HE NOTED
THAT THE PROBLEM OFTEN WAS EXACERBATED BY ETHNIC AND ECONOMIC
FACTORS, AND CITED THE MOLUCCAS AS AN EXAMPLE. KALLA SAID
THAT THE LOCAL MERCHANT CLASS WAS DOMINATED BY BUGINESE OR
BUTONESE MUSLIM IMMIGRANTS, WHILE MOST LOCAL CHRISTIANS HAVE
TRADITIONALLY OPTED FOR LESS LUCRATIVE CALLINGS AS PLANTATION
LABOR OR IN THE BUREAUCRACY. HE CLAIMED THE GOI WAS
NEVERTHELESS PREPARED TO TAKE FIRM STEPS TO QUELL THE
VIOLENCE IN THE MALUKUS, NOTING THAT A MULTI-SERVICE "JOINT
BATTALION" HAD BEEN SPECIALLY FORMED BY TNI FOR THE TASK. HE
CONCEDED, HOWEVER, THAT LITTLE TRUST REMAINED BETWEEN THE
COMMUNITIES, AND THAT DIVISIONS WOULD PERSIST INDEFINITELY.


8. (C) WHEN QUERIED BY THE AMBASSADOR ON LASKAR JIHAD'S ROLE
IN PROLONGING THE VIOLENCE AND GOI STEPS TO REIN IN SUCH
GROUPS, KALLA REJOINED THAT GROUP WAS NOT ENTIRELY TO BLAME.
A BUGINESE MUSLIM HIMSELF, THE MINISTER CONTENDED THAT
CHRISTIAN MILITANTS FROM ACROSS INDONESIA, PARTICULARLY
SUMATRAN BATAKS, ALSO HAVE TRAVELED TO AREAS OF SECTARIAN
STRIFE LIKE THE MALUKUS AND CENTRAL SULAWESI. KALLA
NEVERTHELESS EXPRESSED OPTIMISM THAT THE "JOINT BATTALION"
WOULD NEUTRALIZE SUCH INTERVENTION IN THE MALUKUS. HE NOTED
THAT IN CENTRAL SULAWESI, HOWEVER, THE FIGHTING HAD RESULTED
IN 100-120,000 IDPS IN THE VICINITY OF PALU, MOST OF WHOM
WERE HOUSED IN MAKESHIFT CAMPS, SCHOOLS, OR WITH RELATIVES.
KALLA SAID THE GOI WAS TRYING TO ASSIST THEM, AS WELL AS TO
INDUCE THEM TO RETURN HOME TO AVOID CONFLICT WITH LOCAL
RESIDENTS. HE ADDED THAT MUCH THE SAME WAS TRUE OF MADURESE
IDPS IN CENTRAL KALIMANTAN, NOTING THE ISSUE HAD GREATLY
IMPROVED WITH THE RETURN TO MADURA OF MOST OF THE IDPS, AND
THE PROVINCIAL LEGISLATURE'S PROMULGATION OF LAWS REGULATING
COMMUNITY RELATIONS. KALLA SQUARELY BLAMED THE MADURESE FOR
THE VIOLENCE THAT HAD BEFALLEN THEM, HOWEVER, DESCRIBING
THEIR CULTURE AND PROCLIVITY TO FORM GANGS (PARTICULARLY
THOSE "FROM SURABAYA") AS "TOO STRONG" FOR LOCAL
SENSITIVITIES.

POVERTY ALLEVIATION: A NEW TACK
--------------


9. (C) KALLA RESPONDED TO THE AMBASSADOR'S QUESTION ABOUT
GOI'S POVERTY ALLEVIATION STRATEGY BY SAYING THE GOVERNMENT
SHOULD FOCUS PRIMARILY ON EQUITY ISSUES. NOTING THE GOI
PREVIOUSLY RELIED ON GROWTH-BASED DEVELOPMENT STRATEGIES THAT
ULTIMATELY BENEFITED ONLY THE ELITES, KALLA ARGUED THE
GOVERNMENT NOW NEEDED TO CREATE EQUITY THROUGH INCOME GROWTH
STRATEGIES:

--THIS, HE EXPLAINED, COULD BE ACHIEVED AT THE "MICRO" LEVEL
BY DEVELOPING SMALL ENTERPRISES, AGRICULTURE, AND SOCIAL
WELFARE AND HEALTH SERVICES.

--AT THE "MACRO" LEVEL, KALLA SAID, EXISTING INVESTMENT (NO
NEW INVESTMENT WOULD BE NEEDED) COULD BE BETTER CHANNELED TO
BENEFIT THE PEOPLE BY TARGETING SECTORS THAT WOULD SPUR
DEVELOPMENT OF INDONESIA'S DOMESTIC MARKET, AND TAKE
ADVANTAGE OF THE PUBLIC'S INCREASED PURCHASING POWER.


10. (C) KALLA SAID THAT FOREIGN INVESTMENT SHOULD BE DEVOTED
TO PRIVATIZING EXISTING ENTERPRISES, RATHER THAN THE
ESTABLISHMENT OF NEW ONES. HE NOTED THAT THE LAST THING THE
COUNTRY NEEDED WAS ANOTHER FIVE-STAR HOTEL. WHILE CONCEDING
THE AMBASSADOR'S POINT THAT THE SEMEN GRESIK SALE HAD RUN
INTO OPPOSITION FROM LOCAL INTERESTS, KALLA NOTED THAT
SEVERAL OTHER IBRA-MANAGED ENTERPRISES WERE PRIMED FOR SALE,
INCLUDING BANK CENTRAL ASIA (BCA) AND INDO-TV. THE MINISTER
ACKNOWLEDGED THE AMBASSADOR'S VIEW THAT THE GOI MUST SELL AT
LEAST ONE SUCH ASSET TO BOOST INTERNATIONAL INVESTOR
CONFIDENCE.

INDONESIANS LOVE AN UNDERDOG
--------------


11. (C) KALLA ENDED THE MEETING BY ASKING THE AMBASSADOR TO
UNDERSTAND THE INDONESIAN PUBLIC'S HOSTILITY TO US-LED
MILITARY OPERATIONS IN AFGHANISTAN. THE MINISTER CONTENDED
THAT MOST INDONESIANS DO NOT CONNECT THE US CAMPAIGN WITH THE
SEPTEMBER 11 ATTACKS IN THE UNITED STATES. HE NOTED HE OFTEN
HAS RESPONDED TO PUBLIC QUERIES ABOUT HIS VIEWS ON "US
AGGRESSION" IN AFGHANISTAN BY COUNTERING THAT THE ISSUE IS,
MORE ACCURATELY, THE "US RESPONSE TO THE WTC ATTACK." KALLA
ASSURED THE AMBASSADOR THAT INDONESIAN PUBLIC'S POSITION ON
THE ISSUE ONLY REFLECTS ITS TENDENCY TO SIDE WITH THE
UNDERDOG.


12. (C) THE MINISTER ALSO USED THE DISCUSSION TO HIGHLIGHT
HIS PERSONAL PARTICIPATION IN DELIVERING GOI HUMANITARIAN
ASSISTANCE TO AFGHANISTAN. KALLA NOTED HE HAD ACCOMPANIED AN
AID CONSIGNMENT VIA C-130 TO PAKISTAN ON NOVEMBER 1, AND HAD
MET WITH PRESIDENT PERVEZ MUSHARRAF. THE PAKISTANI LEADER
HAD SAID THAT THE TALIBAN HAD SET ISLAM BACK 500 YEARS,
ACCORDING TO KALLA, WHO ADDED THAT HE SHARED MUSHARRAF'S
OBSERVATION WITH THE INDONESIAN PUBLIC AT A SEMINAR FOLLOWING
HIS RETURN HOME.

COMMENT: SOME CAUSES FOR CONCERN
--------------


13. (C) KALLA'S APPEAL THAT WE RECOGNIZE THE BASIS AND
LIMITED EXTENT OF INDONESIAN PUBLIC ANTIPATHY FOR THE US-LED
MILITARY CAMPAIGN IN AFGHANISTAN ECHOES A NOW-FAMILIAR
REFRAIN BY SENIOR GOI OFFICIALS, WHO ARE KEEN TO ASSURE OF US
THE GOI'S FUNDAMENTAL SUPPORT FOR THE WAR ON TERRORISM.
HOWEVER, MANY OF KALLA'S OTHER COMMENTS AND OMISSIONS RAISE
CONCERNS ABOUT THE DIRECTION OF GOI POLICY. WE NOTE THAT,
WHILE HE EXPRESSES PROFOUND CONFIDENCE THAT JAKARTA CAN
LEGISLATE AWAY SEPARATIST THREATS IN ACEH AND ELSEWHERE,
KALLA JOINS OTHER GOI OFFICIALS IN FAILING TO APPRECIATE THE
NEED TO ACCOUNT ALSO FOR TNI AND POLICE ABUSES AGAINST
CITIZENS IN THE OUTER PROVINCES. THE MINISTER SIMILARLY
JOINED MANY OF HIS COLLEAGUES IN FAILING TO ACKNOWLEDGE THE
NEED TO DECISIVELY REIN IN PARAMILITARY RELIGIOUS MILITANTS
LIKE LASKAR JIHAD, WHICH ALSO POSE AN IMMEDIATE THREAT TO
INDONESIA'S STABILITY. INDEED, KALLA'S DEFENSIVE RESPONSE
CITING EXTERNAL CHRISTIAN INTERVENTION IN AREAS ROCKED BY
SECTARIAN VIOLENCE, WHILE DOWNPLAYING THE LASKAR JIHAD'S
PROMINENT ROLE, SUGGESTS A SUBJECTIVE POSITION ON THE ISSUE.
THE MINISTER'S READINESS TO TAKE SIDES IS SHOWCASED ELSEWHERE
BY HIS QUICKNESS TO BLAME THE (MADURESE) VICTIMS OF COMMUNAL
VIOLENCE IN KALIMANTAN.


14. (C) COMMENT CONTINUED: SIMILARLY, NOTHING ABOUT KALLA'S
APPROACH TO POVERTY ALLEVIATION STRIKES US AS HOPEFUL.
INDONESIA NEEDS NEW INVESTMENT TO CREATE JOBS. PEOPLE WITH
JOBS CAN CLIMB OUT OF POVERTY. THE REASON THAT THE
GROWTH-LED DEVELOPMENT BENEFITED THE ELITE IN THE PAST WAS
DUE TO GOVERNMENT-DIRECTED POLICIES. SOEHARTO FREQUENTLY
SPOKE OF THE NEED TO SUPPORT COOPERATIVES AND SMALL AND
MEDIUM BUSINESS. KALLA'S ATTEMPTS TO DIRECT FUNDS TO THE
SAME ENDS ARE LIKELY TO ACHIEVE THE SAME RESULTS.

BOYCE