Indonesia Looks East: Widodo’s Engagement with Australia and Papua New Guinea

Indonesian President Joko Widodo’s swansong overseas trips – to Sydney, Australia (3-5 July) and Port Moresby, Papua New Guinea (PNG) thereafter – have scored some points for Widodo that could enhance Indonesia’s influence in the Indo-Pacific, if this momentum can be sustained by his successor’s administration. Taking the Australia-Indonesia relationship to a solid footing would complement Indonesia’s developmental roadmap for “Vision 2045”, while the Australians are committed to increasing their interaction with Southeast Asia’s largest economy in the coming decades.

The Australia visit mainly highlighted both sides’ desire to boost bilateral economic ties. Widodo’s PNG trip was a courtesy one reciprocating PNG Prime Minister James Marape’s 2022 Indonesia visit. While their goals were different, Widodo’s visits to Sydney and Port Moresby reflected his consistent attention to supporting bilateral ties with Indonesia’s nearest neighbours, despite earlier misgivings in his presidency that he would neglect foreign policy at the expense of his domestic agenda. 

Australia and Indonesia wield significant potential as middle powers in this region at this critical juncture in geopolitics. Prior to Widodo’s visit, respected scholars from both countries urged their leaders to realise the true potential of the bilateral relationship and represent small and middle powers, to articulate an alternative vision from that of a feared clash of great powers.

Topmost on the list of goodies Indonesia secured was the agreement for Australia to allow Indonesians access to Australia’s Frequent Traveller Scheme, which enables some Indonesians to get a 10-year visa to reside Down Under. Australian Prime Minister Anthony Albanese said this move would “make an enormous difference in removing impediments to our closer relationship”. Another highlight was the agreement to collaborate on electric vehicle (EV) and EV battery production. Australia is one of the world’s largest producers of lithium, which complements Indonesia’s reserves of nickel; both components are critical to EV battery production. This collaboration will augment Indonesia’s plan to become a premier EV production hub and reinforce regional supply chain resilience. Australia also plans to open three university campuses in Indonesia and undertake climate finance arrangements.

Underscoring intentionality, Albanese commented that both countries “continue to choose to draw closer together as economic partners, as security partners and as partners in the global transition to net zero”. However, such rhetoric has not convinced some critics, who think Australia has not done enough to court Indonesia on security-related issues or that the two countries significantly disagree or diverge on the best approach towards keeping the region peaceful and secure. That said, there are enough commonalities in the two countries’ approaches to regional order. Australia has sufficient interest in upholding the international rules order and in balancing and Indonesia in hedging against China’s assertiveness in the region. For the sake of bilateral cooperation, differences in security issues can be set aside. 

Nevertheless, Widodo has paved the way for his successor to raise Indonesia-Australia ties to a higher level. One commentator called it a “low key” trip, but others noted how the two leaders enjoy a “friendly and productive personal relationship”. Current relations are more hale and hearty compared to the start of Widodo’s presidency. Then, bilateral tensions ran high, mainly over the Indonesian government’s execution of two Australians (from the “Bali Nine”) for drug trafficking.

In the past year, the two leaders had capitalised on solid chances to interact in person during last year’s G20 summit in Bali and earlier, when Albanese made his first trip as PM to Bogor Palace that the two leaders retired for a private dinner with no aides present highlights this closeness.

Current relations are more hale and hearty compared to the start of Widodo’s presidency. Then, bilateral tensions ran high, mainly over the Indonesian government’s execution of two Australians (from the “Bali Nine”) for drug trafficking.

However, not all observers are enthusiastic about the direction of economic diplomacy, given Australia’s domestic political constraints. It remains to be seen if the step-up in relations outlasts Widodo’s presidency, due to end in 2024, and Albanese’s premiership. The visit studiously avoided more difficult topics, including Indonesia’s reservations (which FM Marsudi expressed earlier) about Australia’s role in AUKUS, with Indonesia calling for openness instead of “secrecy”. For its part, Indonesia is keen on securing Australia’s backing of its preferred concept of the ASEAN Outlook on the Indo-Pacific (AOIP).

Another hurdle is the long journey towards enhancing people-to-people ties, a necessary and important step towards the imagined closeness of the bilateral relationship. For one, Indonesia expert Professor Greg Fealy has warned that too few Australians “have much understanding of Indonesia at all”.

What has received less attention was Widodo’s brief visit to Papua New Guinea (PNG) on 5 July 2023, after Australia. With border issues and trade on the agenda, Widodo brought some of his top economic officials to meet PNG entrepreneurs in the first-ever Indonesia-PNG business forum. PNG PM James Marape had visited Jakarta last March, clearly seeking gains as Indonesia’s economic might grows apace. Bilateral trade is on an upward trajectory (US$322 million in 2021, from US$212 million in 2020).

President Widodo spoke positively about strengthening trade cooperation and improving connectivity, specifically on the opening of the PNG Express shipping route and the inauguration of a Denpasar (Bali)-Port Moresby flight route. Indonesia also flexed some soft power by offering 2,000 university scholarships to PNG students.

PNG shares a 760-kilometre-long border with Indonesia. While PNG recently ratified a bilateral border agreement from 2013, its capital Port Moresby is home to refugees who have fled across the border from West Papua, where an indigenous Melanesian independence movement has long clashed with Indonesia’s security forces. Some locals are strongly sympathetic to West Papua’s quest for autonomy or even independence.

The PNG leadership were keen not to let anything mar Mr Widodo’s visit: on 1 July 2023, Port Moresby authorities suppressed West Papuan separatist elements from raising the West Papuan flag. They reportedly “removed Morning Star independence flags and banners at the Rainbow refugee camp”, where supporters of Papuan self-determination commemorated the anniversary of their proclamation of independence.  

In this regard, perhaps Indonesia’s courting of its smaller neighbour in the Pacific is already paying off.

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