'Grisly trade' must end before relations with Indonesia can mature

End Jakarta asylum row, Tony Abbott told by Alexander Downer

End Jakarta asylum row, Tony Abbott told by Alexander Downer

By: Brendan Nicholson From: The Australian September 30, 2013

THE nation's longest-serving foreign minister, Alexander Downer, has urged Tony Abbott to quickly resolve the asylum-seeker dispute with Indonesia rather than "sweeping it elegantly under a diplomatic carpet" amid signs the Prime Minister wants trade and investment to dominate his visit to Jakarta. Mr Downer has warned the Coalition the row over boats is holding back stronger economic and business ties between the two nations and must be settled before the end of President Susilo Bambang Yudhoyono's term in the middle of next year. "This issue needs to be settled and fast," Mr Downer writes in The Australian today as Mr Abbott flies to Indonesia at the head of a delegation of senior ministers and 20 business representatives.

'Grisly trade' must end before relations with Indonesia can mature

A COUPLE of weeks ago I was at dinner with a very senior Singaporean official and asked him a simple question. Why is it that people-smugglers don't try to send people to rich and happy Singapore from nearby Indonesian islands? His answer was simple.

"If they come to Singapore we just send them straight back to Indonesia," he said.

The principle is simple. Yet we are having a diplomatic stoush with Indonesia because their boats crewed by their people sailing from their ports are transgressing our territorial waters and landing on Australian territory and the Indonesians object to us sending them back.

Frankly, it's a shame we haven't found a simple and effective way of managing this issue to the satisfaction of Australia and Indonesia. The deaths of 22 people trying to sail to Australia late last week was a reminder that this grisly trade has to stop.

There have been faults on both sides. The Australian government made a catastrophic mistake dismantling all the measures taken to close down this trade in the early 2000s. The Indonesians have made a mistake by telling Kevin Rudd this year that all they would do was convene an international conference on people-smuggling and not much else.

So this week Tony Abbott and Susilo Bambang Yudhoyono have to try to work out a new arrangement. I've proposed on several occasions that Australia and Indonesia could do a deal: Australia would fly back to Indonesia anyone who arrived here by boat without a visa. In exchange, Australia would take, one for one, UNHCR approved refugees from refugee camps in Indonesia. This would stop the boats almost overnight.

The alternative will be turning back the boats. The Indonesians don't like that but the boats are theirs, have their crews and come from their ports. They can hardly complain that we are sending their boats back to Indonesia - their home. This issue needs to be settled and fast. It, along with the absurd live cattle ban, has dominated the Australian Indonesian relationship for the past five years. We need to move on and we need to do so while Yudhoyono is still in power. He only has one year of his fixed term left.

The relationship has a strong foundation. The protracted sore in the relationship, East Timor, was solved in 1999. We now have a comprehensive security agreement known as the 2006 Treaty of Lombok which underpins co-operation between our defence forces and other security agencies. We have defined our maritime boundaries - always a potential cause of contention - through the Treaty of Perth, signed in 1997.

But it's in the economic sphere that we have to make progress.

Indonesia is the world's fourth most populous nation and our neighbour. Yet it is only Australia's 12th-largest trading partner. We have more trade with Malaysia than Indonesia. Yet Malaysia's population is barely 10 per cent of Indonesia's and its gross domestic product is less than half.

The Rudd-Gillard government sensibly started negotiations last year on an Indonesia Australia Comprehensive Economic Partnership Agreement. Since Australia and Indonesia are the region's largest economies, an agreement of this kind makes perfect sense. Finalising these negotiations will, no doubt, be an important priority for Abbott and his Trade Minister, Andrew Robb.

Robb's title is Minister for Trade and Investment. It's a good title. It means the government understands that international economic relations are at least as much about investment as they are about trade.

Australia invests about $6.8 billion dollars in Indonesia and has some 400 companies operating there. Honestly, it's not all that much compared with our investments in the US and Britain. Truth be told, Australian firms have concerns about the sovereign risk of investing in Indonesia. The legal system, to put it diplomatically, doesn't have the best of reputations for protecting private property. Robb needs to get better guarantees on investment security from the Indonesians; then and only then Australian companies will leap into the potentially huge Indonesian market.

But let's be clear about something else - Indonesian firms should be able to invest in Australia, perhaps on the same terms as American firms.

Xenophobic denunciation of plans by Indonesian firms to buy agricultural land are as absurd economically as they are damaging diplomatically. If we are going to build a relationship with Indonesia with real ballast - and that's what we need to do - then there has to be a liberal, open approach to investment in both directions.

So the plan is clear. We have to move beyond the boats issue with Indonesia. There's so much we can do together which will help underwrite the security and prosperity of our neighbourhood. But both governments need to be realistic and practical. The boat problem won't be solved by ignoring it or sweeping it elegantly under a diplomatic carpet. It needs to be fixed and then we can move on.

Alexander Downer was foreign minister in the Howard government.


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