C O N F I D E N T I A L SECTION 01 OF 02 JAKARTA 000764

SIPDIS

SIPDIS

DEPT FOR EAP, EAP/MTS, EAP/MLS, EAP/CM
NSC FOR E.PHU

E.O. 12958: DECL: 04/16/2018
TAGS: PREL PGOV KDEM ID CH XC
SUBJECT: A/S HILL'S MEETING WITH PRESIDENT YUDHOYONO

REF: JAKARTA 684

JAKARTA 00000764 001.2 OF 002


Classified By: Ambassador Cameron R. Hume, reasons 1.4 (b+d).


1. (C) SUMMARY: In an April 4 meeting, EAP A/S Hill and
President Yudhoyono (SBY) engaged in a lively discussion of
democracy, Burma and other issues in the Southeast Asian
region, and China/Tibet. Yudhoyono and Hill also discussed
U.S.-Indonesia bilateral relations, including plans for the
Peace Corps to return to Indonesia. END SUMMARY.

STATE OF THE U.S.-INDONESIA BILATERAL RELATIONSHIP


2. (C) A/S Hill met President Yudhoyono on April 4 at the
Presidential Palace in Jakarta. FM Wirajuda and Ambassador
Hume also joined the meeting. A/S Hill underscored that more
work needs to be done with the U.S. Congress to make progress
on engagement with Kopassus specifically and TNI more
generally, adding that suspicion of TNI remains high in some
quarters. SBY said it was essential to change the
misunderstandings and misperceptions of Indonesia, which was
why he always met CODELS and other visitors. But, Yudhoyono
cautioned, Congressional visitors frequently wanted immediate
results and failed to recognize the challenges facing
Indonesia or the progress that the country had made.


3. (C) A/S Hill told President Yudhoyono that the Peace Corps
had decided to return to Indonesia, subject to
adequate funding. Peace Corps officials would soon be in
touch with the GOI to discuss moving forward with
reestablishing the program. The return of the Peace Corps to
Indonesia would itself be beneficial, and would serve as a
strong signal that Indonesia was now a safe destination for
tourism and business travel. SBY welcomed this initiative,
and felt it would help bring a real understanding of
Indonesia to the United States. A/S Hill also indicated that
the Department was looking at revising the travel warning, a
sensitive subject in bilateral relations.

BURMA


4. (C) The president also commented on Burmese ruler Than
Shwe's dis

appointing reply to Yudhoyono's recent letter.
Than Shwe had merely justified the regime's inaction, placing
blame on Aung San Suu Kyi for refusing to cooperate with the
regime's efforts to impose its "road map" to democracy. The
Burmese ruler had claimed the regime would continue to
implement democracy but in a slow step-by-step process.
Indicating some frustration with ASEAN's efforts to promote
change in Burma, SBY focused his discussion on Indonesian
efforts to engage the regime. He asked that the United
States pressure China and India into a more active role.
Yudhoyono stated it was hard for Indonesia to talk about
Burma without Chinese support, since anytime ASEAN tried to
push the Burmese, they moved closer to China.


5. (C) A/S Hill commented that China had not provided a way
forward on the Burma issue, and stressed that Burma was an
emotional issue in the United States. It was critical that
ASEAN step up its efforts, while continuing to support UN
Special Envoy Gambari. If ASEAN was unable to resolve the
matter internally, and Burma continued to marginalize
Gambari, it would drive the discussion into the UNSC, where
unity would be harder to maintain. However, success on this
issue would significantly strengthen ASEAN. A/S Hill urged
SBY to work with ASEAN to find a practical way forward in
order to avoid harming the U.S.-ASEAN relationship. SBY
recommended that A/S Hill discuss these issues with PM Lee of
Singapore, the current chair of ASEAN, and indicated he would
call Lee to stress this point as well.

DEMOCRACY AND OTHER REGIONAL ISSUES


6. (C) Yudhoyono noted that Indonesia sought to promote
democracy in the region. Indonesia had been the last ASEAN
member to recognize the coup government in Thailand, and had
urged a quick return to democracy there. The coup leaders

JAKARTA 00000764 002.2 OF 002


had promised not to rule for more than a year, and they had
kept this promise.


7. (C) SBY said Philippine President Arroyo had contacted him
some time back through her Ambassador in Jakarta to say she
had been concerned about a possible military coup in the
Philippines. SBY had told Arroyo that Indonesia would not
support any undemocratic action against the Philippine
Government. SBY told A/S Hill it was important that the
Philippines be invited to Organization of the Islamic
Conference (OIC) meetings as an observer, as this might be a
helpful step in resolving the Mindanao conflict.


8. (C) Yudhoyono said a portion of the Malaysian government
still believed that semi-authoritarian rule was appropriate
for their country. But the people of Malaysia saw the
openness and progress occurring in neighboring Indonesia,
which was culturally and ethnically similar, and compared it
with media controls and affirmative action for the ethnic
Malays in their own country. Malaysia could not continue to
oppose reform or it would isolate itself, Yudhoyono stated.

CHINA/TIBET


9. (C) After a brief discussion of the Six-Party talks, A/S
Hill explained that President Bush planned to honor his
promise to attend the Olympics in Beijing. The Olympics were
a source of pride for all Chinese, including those who were
critical of the government. However, China must stop
vilifying the Dalai Lama and be more honest with journalists
and diplomats who visited Tibet. SBY said that the rhetoric
from China on Tibet sounded the "same as Indonesia's from 20
years ago, when speaking about Aceh," and he wondered whether
the Chinese had considered some form of special autonomy as a
way to resolve the issue without military intervention.
Indonesia had done this in Aceh and Papua, with some success.

SBY CONCERNED ABOUT ECONOMY


10. (C) Turning to the domestic front, SBY admitted that
increasing commodities prices were becoming a challenge
economically, socially and politically (reftel). He also
said he had learned from his 2005 attempt to cut fuel
subsidies: it had taken two years for people's purchasing
power to recover. He did not want to repeat this and was
therefore looking at subsidies that only the poor would
receive. He also planned to reduce total fuel consumption
and cut subsidies, while explaining to people that this was
increasingly a global phenomenon, not simply an Indonesian
problem.
HUME