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Viewing cable 09JAKARTA1641, WORKING WITH INDONESIA IN THE G-20

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Reference ID Created Released Classification Origin
09JAKARTA1641 2009-10-01 08:57 2011-08-24 01:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Jakarta
VZCZCXYZ0001
RR RUEHWEB

DE RUEHJA #1641/01 2740857
ZNR UUUUU ZZH
R 010857Z OCT 09
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC 3448
RUEATRS/DEPT OF TREASURY WASHDC
INFO RHEHNSC/NSC WASHDC
UNCLAS JAKARTA 001641 
 
SIPDIS 
SENSITIVE 
 
DEPT FOR U/S HORMATS 
TREASURY FOR U/S DESIGNATE BRAINARD 
EAP A/S CAMPBELL, DAS MARCIEL 
DEPT ALSO EAP/MTS, EEB/EPPD/PA, AND EEB/IFD/OMA 
 
E.O. 12958: N/A 
TAGS: PREL EFIN ECON ID
SUBJECT: WORKING WITH INDONESIA IN THE G-20 
 
1. (SBU) Summary.  The United States can partner with Indonesia in 
the G-20 to advance our interests.  Of the eleven countries in the 
G-20 who are not in the G-8, Indonesia is arguably the one with whom 
we have the least developed ties and the one least prepared 
institutionally to actively participate.  But many of the areas 
discussed at the Pittsburgh G-20 Summit - elimination of fuel 
subsidies, food security, and climate changes - are areas where we 
can partner with Indonesia to advance our mutual interests.  Embassy 
Jakarta recommends that the U.S. delegation to the IMF/World Bank 
meetings in Istanbul hold initial discussions with Indonesia on 
possible areas of G-20 collaboration.  Under Secretary Hormats could 
continue these discussions in November if he were to visit Jakarta 
in conjunction with his participation in the November APEC Summit in 
Singapore.  End Summary. 
 
2. (SBU) Indonesia understands the historical significance of (and 
the leadership role of the U.S. in supporting) the Pittsburgh 
announcement that G-20 would be the premier global economic forum. 
Indonesia's G-20 Sherpa told us that this decision rivaled the 
development of the non-aligned movement and the founding of ASEAN in 
importance for Indonesia.  He also said that Indonesia sees its role 
in the G-20 as the representative for ASEAN countries and the entire 
developing world.  (Note: Of the G-20 nations, Indonesia has the 
second-lowest GDP per capita, ahead of only India). 
 
3. (SBU) The eleven countries who are not G-8 members will all have 
to figure out their role in this more important G-20.  The United 
States should help them integrate and encourage them to support U.S. 
objectives.  This process will be straightforward with most of these 
eleven countries; we have strong, broad relations and frequent, 
high-level interactions with India, China, Brazil, Turkey, South 
Korea, Australia, and Mexico.  Although we are building a 
comprehensive partnership, our ties are less strong with Indonesia. 
And Indonesia is less accustomed to playing a global leadership 
role. 
 
4. (SBU) There are, however, a number of areas announced at the 
Pittsburgh Summit where our two countries can work to advance our 
mutual objectives while building Indonesia's capacity within the 
G-20.  Interestingly, these areas of collaboration are key elements 
of the rationale for transferring the G-8's role to the G-20.  They 
include: the elimination of fossil fuel subsidies, climate change 
finance, and food security. 
 
5. (SBU) We should find ways to help Indonesia meet the pledge to 
eliminate market-distorting subsidies on energy.  The World Bank 
estimates that over the past eight years somewhere between nine and 
twenty-five percent of the Indonesian budget went to fuel and 
electricity subsidies.  Despite these subsidies, 35 percent of 
Indonesians have no access to electricity.  Subsidies also make it 
difficult for clean and renewable energy to compete with traditional 
fossil fuels.  Partnership with Indonesia in this area will enable 
Indonesia to eventually commit to emission cuts; virtually all of 
Indonesia's projected increase in greenhouse gas emissions will come 
from the energy sector. 
 
6. (SBU) Indonesia can also be a partner on climate change finance. 
It is a member of the World Bank's Strategic Climate Fund Trust Fund 
Committee and a likely recipient of funds from the World Bank's 
Clean Technology Fund.  Its G-20 Sherpa told us that Indonesia is 
disappointed with the last-minute deletion of language regarding 
financing of climate change in Pittsburgh.  We should coordinate our 
positions in advance of the planned heads-of-state teleconference on 
this subject. 
 
7. (SBU) Indonesia would also welcome collaboration on food 
security.  Given ongoing food shortage issues in eastern Indonesia, 
President Yudhoyono has made food security a top priority and 
specifically asked that food security be a part of the 
U.S.-Indonesian comprehensive partnership.  We have developed 
proposals within that framework, including a center of excellence on 
sustainable ocean fisheries.  But Indonesia would be interested in 
cooperating on this topic within the G-20 as well. 
 
8. (SBU) By engaging with Indonesia within the G-20, the United 
States can: 
 
   -- build Indonesia's capacity to assume its role in the 21st 
century's premier global economic forum; 
 
   -- strengthen our bilateral ties to Indonesia; and 
 
   -- advance our own priorities within the G-20. 
 
Embassy Jakarta recommends that the U.S. delegation to the IMF/World 
Bank meetings in Istanbul hold initial discussions with Indonesia on 
possible areas of G-20 collaboration.  Under Secretary Hormats could 
continue these discussions in November if he were to visit Jakarta 
before or after his participation in the November APEC Summit in 
Singapore. 
 
OSIUS