YUDHOYONO SHARES HIS VISION FOR INDONESIA IN

UNCLAS SECTION 01 OF 02 JAKARTA 001360 SIPDIS DEPT FOR EAP, EAP/MTS, EAP/MLS, EAP/RSP NSC FOR J. BADER E.O. 12958: N/A TAGS: PGOV PREL ECON KDEM ID SUBJECT: YUDHOYONO SHARES HIS VISION FOR INDONESIA IN NATIONAL DAY SPEECH REF: JAKARTA 1352 AND PREVIOUS ¶1. (SBU) SUMMARY: President Yudhoyono's August 14 National Day Address showed a confident leader on the cusp of his second and final term of office who sees his nation at the launching point for greater things. The broad vision for Indonesia Yudhoyono laid out corresponds in many ways to the contents of the Comprehensive Partnership and may offer opportunities for an ambitious agenda if President Obama visits in the fall. Yudhoyono sketched out a nationalist economic policy that downplayed the role of exports for economic growth. However, he encouraged Indonesia to produce the technology and entrepreneurs necessary for the country to compete and benefit from the global economy. Yudhoyono also reinforced his commitment to fight terrorism. END SUMMARY. YUDHOYONO'S VISION: A SELF-RELIANT BUT COMPETITIVE DEMOCRACY ¶2. (SBU) In his August 14 National Day speech, with his re-election victory finally confirmed, President Yudhoyono laid out his vision of where Indonesia should be in the year ¶2025. Indicating that he views the current juncture as a turning point for Indonesia, Yudhoyono began by extolling Indonesia's democratic progress since independence, and in particular during the decade of "reformasi" following the fall of Suharto. He noted that few observers in 1998 would have predicted that Indonesia would become the stable, unified democratic state it is today. ¶3. (SBU) Yudhoyono highlighted poverty alleviation and anti-corruption efforts, central planks of his re-election campaign, as his administration's top achievements. He noted that in 2004, Indonesia was at the bottom 10 of the Transparency International ranks, and it is now 55 from the bottom. He also lauded Indonesia's military reform and rule of law as bulwarks of the democratic state. ¶4. (SBU) Looking forward, Yudhoyono projected a bigger role on the world stage for Indonesia as the world's third largest democracy, a bridge between Islam and the West, a bridge for a consensus on climate change, and as the largest economy in Southeast Asia. In order to achieve that role, Yudhoyono said there remains much work on transparency, military reform, the rule of law, educational advancement, and environmental protection. These are all goals that tie in well with the Comprehensive Partnership. Yudhoyono's ambitious vision may also provide opportunities for groundbreaking achievements in moving the bilateral relationship forward if President Obama visits in the fall. A COUNTRY WITH MANY FRIENDS AND NO ENEMIES ¶5. (SBU) Yudhoyono is well known for accommodating political rivals, and he gave conciliatory nods to his opponents in the July 8 presidential election, Megawati and Vice President Kalla. He noted Megawati's contribution to Indonesia's democratization, and, in a piece of rhetoric that drew cheers and applause from his audience, he concluded his speech with a proverb from Kalla's ethnic group, the Buginese. Yudhoyono's desire to mend fences at home was reflected in his vision of an "all directions foreign policy" that has "a million friends and zero enemies." ECONOMIC NATIONALISM COMBINED WITH GLOBALIZATION ¶6. (SBU) On the economy, Yudhoyono played a balancing act with nods toward both economic nationalists still smarting from the IMF years and internationally trained economists, such as his vice presidential running mate Boediono. His speech indicated that the lesson Yudhoyono has learned from the current global financial crisis is that Indonesia should continue to be economically self-reliant. Yudhoyono said that Indonesia must not rely on exports for economic growth, and that "in essence, we must not be ensnared, surrender to and be held hostage by fundamental capitalism." He also stressed, however, that Indonesia should take advantage of economic globalization and develop a comparative advantage on the basis of technological innovation and entrepreneurship. STANDING UP TO TERRORISM ¶7. (SBU) Yudhoyono's remarks on terrorism were one of the most anticipated parts of his speech, and generated the strongest media reaction. He defiantly declared that Indonesia would not be defeated in the fight against terrorism, and urged Indonesians to become directly involved JAKARTA 00001360 002 OF 002 and "unite in the fight against the acts of terrorism . . . and provide information on perpetrators. . .who hide in the midst of (their) communities." Yudhoyono decried the July 17 terrorist attacks, which came at a time when Indonesia had made big strides in improving the nation's security. He vowed to both attack terrorism at its roots through poverty alleviation and to take measures to prevent and eradicate terrorism. HUME