China worries may boost Indonesia defence spending to $20 billion/year - official

[BoQ77]

China worries may boost Indonesia defence spending to $20 billion/year - official
By David Brunnstrom

WASHINGTON Tue Dec 9, 2014 11:54pm GMT

(Reuters) - Indonesia's defence spending could grow to $20 billion (£12.75 billion) a year by 2019 to protect its sovereignty, including an area of the South China Sea near China's claims, an adviser to new Indonesian President Joko Widodo said on Tuesday.

Luhut Panjaitan, a former commander of Indonesia's special forces, said Jakarta had no plans to use force to resolve territorial disputes in the South China Sea and would continue to promote dialogue between Beijing and its regional rivals.

But he said it was important to strengthen the Indonesian military to protect national interests, including Natuna - a scattering of 157 mostly uninhabited islands off the northwest coast of Borneo that are rich in oil, gas and fish.

Officially, China and Indonesia agree the islands are part of Indonesia's Riau Province. But in April, Indonesia's armed forces chief accused China of including parts of Natuna within its so-called "Nine-Dash Line," a vague boundary used on Chinese maps to lay claim to about 90 percent of the South China Sea, including territory claimed by other members of the Association of Southeast Asian Nations.

"Regarding Natuna, we understand very much that this is the territory of Indonesia," Luhut told Washington's Center for Strategic and International Studies think tank.

Indonesia's joint gas exploration in Natuna with U.S. oil firm Chevron Corp should be "a signal to China that you cannot play a game here because it’s also the presence of the U.S.," he said.

Lahut said Indonesia had a role to play in maintaining the balance of power in Asia and planned to increase its defence spending to 1.5 percent of gross domestic product over the next five years.

"We link to economic growth of about 7 percent ... so by 2019, the national defence budget can go to around $20 billion per annum," he said.

"If you look at now the Chinese armed forces - much stronger - and you look at India and Indonesia ... Indonesia can play a role to balance the power in this region."

Lahut said the government wanted to strengthen Indonesia's navy to enable more sea patrols and to increase its three squadrons of C-130 transport aircraft to five. He also said drones would be an important part of Widodo's border-protection strategy.

Indonesia's special forces, meanwhile, would concentrate on the fight against Islamic State, a radical Muslim organisation in the Middle East that about 300 Indonesian nationals have joined.

 

[TaiShang]

China and Indonesia will resolve the issue bilaterally, as the official above reiterates. Relations will only improve as Indonesia asserts itself as the unquestioned leader of the ASEAN.

Indonesia forges stronger ties with China to boost economy

Shofwan Al Banna Choiruzzad, Lecturer and Researcher at University of Indonesia

Indonesia wants closer ties with China to boost investment in the domestic economy. Jason Lee/EPA
With his country’s economy in mind, Indonesian president Joko Widodo is reciprocating China’s invitation to build stronger relations.

China has been actively inviting southeast Asia’s largest economy to strengthen relations. Following the inauguration of Widodo, who is commonly known as Jokowi, and just days before the APEC Summit in Beijing, Chinese foreign minister Wang Yi visited Jakarta.

For China, Indonesia will be an important partner to manage its relations with countries in the southeast Asia region, grouped in ASEAN. China is involved in territorial disputes with several ASEAN members over the South China Sea.

For Indonesia, China can be a source of finance for infrastructure projects in the archipelago. Indonesia needs around Rp 6,000 trillion (or around US$740 billion) for infrastructure development projects in the next five years to achieve 7%-a-year growth in its economy. Indonesia is currently experiencing its slowest growth since late 2009. The government expects 5.8% growth this year, lower than the 6.3% target.

At the APEC Summit in Beijing, Jokowi requested that Chinese president Xi Jinping boost the involvement of Chinese state companies in developing Indonesia’s infrastructure. He also proposed a bigger role for Indonesia in the China-led Asian Infrastructure Investment Bank (AIIB). He suggested the headquarters of the AIIB be in Indonesia.

Some analysts view AIIB as a rival to the Japan-backed Asian Development Bank and thus a driver of change in the US-Japan-dominated status quo in the Asia Pacific. Australia, under pressure from the US, is not joining the AIIB.

What do Indonesia’s closer economic relations with China say about Indonesia’s relationship with the US and its allies?

More China and (not) less America
Indonesia’s intention to forge closer ties with Beijing is a natural result of China’s economic rise. It does not, however, reflect the demise of US and its allies' influence in the region. In contrast, by getting closer to China, Indonesia is inviting balancing acts by US and its allies. By doing so, Jakarta is hoping to broaden its options in various policy arenas.

China is the world’s second-largest economy. Within a decade or two, it is expected to grow into the world’s largest.

Most countries in southeast Asia and beyond want to reap the benefits of China’s rise. But they don’t want to be dominated by a powerful bully. Despite Chinese rhetoric of a “peaceful rise”, its actions are not always peaceful – as seen in recent incidents in the South China Sea.

Even so, ASEAN countries could not resist their big northern neighbour. Vietnam, for example, benefits from trading with China. Trade between Vietnam and China increased tenfold from US$1.2 billion in 2001 to around US$12 billion in the late 2000s.

To balance China’s power, Vietnam joined the US-backed Trans-Pacific Partnership(TPP) discussions. This move allows Vietnam to diversify its economic relations and gain access to a powerful ally.

It should be noted, though, that at the APEC Summit China pushed for the formation of the Free Trade Area in the Asia-Pacific (FTAAP). Many interpret this move as China’s attempt to “neutralise” the exclusionary effect of the US-backed TPP. China is excluded from the TPP.

Foreign policy based on national interest

Indonesian president Joko Widodo’s foreign policy is domestically oriented. EPA/Azhar Rahim
Jokowi has signalled that his foreign policy will be guided by Indonesia’s economic national interest. Consequently, his international relations achievements would be measured by tangible results. This is why Indonesia is getting close with China, but the process will not be without obstacles.

At least three issues will guide Indonesia’s policy towards China. First, Indonesia wants to have more balanced trade with China. Since the 2000s, Indonesia has experienced growing trade deficits. In 2008, Indonesia recorded a trade deficit of US$3.6 billion. The deficit is growing and reached US$7.7 billion in 2012.

Second, Indonesia wants to access funds from the huge Chinese economy to develop its infrastructure. Jokowi’s speeches at the APEC and ASEAN summits illustrated this. At APEC, he elaborated on Indonesia’s development plan and invited APEC economies to invest in infrastructure projects in the country.

China has the economic capacity to provide what Indonesia needs. It has the largest foreign-exchange reserves in the world, amounting to US$2.4 trillion.

This does not mean that Indonesia sees the ADB as less important. Currently, the ADB is the third-largest source of financing for Indonesia’s development, with 15.2% of total financing. Japan, the leading actor in the ADB, is the largest (35.1%) and the World Bank is the second-largest (23.6%). So, rather than a sign of allegiance, Indonesia sees participation in the AIIB as an opportunity to expand its options to fund infrastructure development.

Third, ensuring economic growth, stability and security in the region is important. In this context, the conclusion of a code of conduct in the South China Sea will be on the agenda.

Of course, the task of concluding the code of conduct has never been easy. In May, China deployed an oil rig in disputed waters off the coast of Vietnam, provoking anti-Chinese riots there. In August, the Philippines spotted two Chinese hydro-graphic ships in an area claimed by the Philippines as part of its Exclusive Economic Zone (EEZ).

With China’s increasing economic clout in the region, reaching agreement might be even more difficult.

 

[northeast]

Good，competition is always good .

 

[hans]

Indonesia rely a lot on Chinese weapons..
Also Indonesia is at least neutral, if not pro-China, in south China sea issue..
There is only EEZ issue between China and Indonesia. No island or territory issue.

China worries may boost Indonesia defence spending to $20 billion/year - official
By David Brunnstrom

WASHINGTON Tue Dec 9, 2014 11:54pm GMT

(Reuters) - Indonesia's defence spending could grow to $20 billion (£12.75 billion) a year by 2019 to protect its sovereignty, including an area of the South China Sea near China's claims, an adviser to new Indonesian President Joko Widodo said on Tuesday.

Luhut Panjaitan, a former commander of Indonesia's special forces, said Jakarta had no plans to use force to resolve territorial disputes in the South China Sea and would continue to promote dialogue between Beijing and its regional rivals.

But he said it was important to strengthen the Indonesian military to protect national interests, including Natuna - a scattering of 157 mostly uninhabited islands off the northwest coast of Borneo that are rich in oil, gas and fish.

Officially, China and Indonesia agree the islands are part of Indonesia's Riau Province. But in April, Indonesia's armed forces chief accused China of including parts of Natuna within its so-called "Nine-Dash Line," a vague boundary used on Chinese maps to lay claim to about 90 percent of the South China Sea, including territory claimed by other members of the Association of Southeast Asian Nations.

"Regarding Natuna, we understand very much that this is the territory of Indonesia," Luhut told Washington's Center for Strategic and International Studies think tank.

Indonesia's joint gas exploration in Natuna with U.S. oil firm Chevron Corp should be "a signal to China that you cannot play a game here because it’s also the presence of the U.S.," he said.

Lahut said Indonesia had a role to play in maintaining the balance of power in Asia and planned to increase its defence spending to 1.5 percent of gross domestic product over the next five years.

"We link to economic growth of about 7 percent ... so by 2019, the national defence budget can go to around $20 billion per annum," he said.

"If you look at now the Chinese armed forces - much stronger - and you look at India and Indonesia ... Indonesia can play a role to balance the power in this region."

Lahut said the government wanted to strengthen Indonesia's navy to enable more sea patrols and to increase its three squadrons of C-130 transport aircraft to five. He also said drones would be an important part of Widodo's border-protection strategy.

Indonesia's special forces, meanwhile, would concentrate on the fight against Islamic State, a radical Muslim organisation in the Middle East that about 300 Indonesian nationals have joined.

 

[BoQ77]

How China has any EEZ issue with Indonesia. Look at map !!!

 

[Nike]

Indonesia rely a lot on Chinese weapons..
Also Indonesia is at least neutral, if not pro-China, in south China sea issue..
There is only EEZ issue between China and Indonesia. No island or territory issue.

errr actually Indonesia buying and importing much of our military equipment from US, Europe and Russia. But, yes recently we are trying to looking about Chinese military equipment as their gap with Western made stuff has increasingly more closer for every passing days.

 

[EastSea]

Indonesian friends are very happy when Chinese guys say that Indonesia is leader of ASEAN.

Malaysia, China intimate friends, says Chinese president

BEIJING: Malaysia and China are “qin mi” (intimate) friends and trustworthy partners, Chinese President Xi Jinping said Monday.

In a bilateral meeting at the Great Hall of the People in Beijing, on the sidelines of the 2014 Apec (Asia-Pacific Economic Cooperation) Economic Leaders’ Meeting, Xi welcomed Malaysian Prime Minister Datuk Seri Najib Tun Razak on his second visit to the Chinese capital this year.

“I am very happy to see you again, after you visited China half a year ago.

“You followed the footsteps of your father Tun Abdul Razak Hussein and made a historical visit to China during the 40th anniversary of bilateral ties.

“It has become a wonderful tale in the history of relationship between our both countries,” Xi said.

Xi described the 40th anniversary as one of the amazing chapters in the history of the relationship between Malaysia and China, and called for higher political wisdom and stronger political will to establish a development blueprint for the bilateral ties in order to achieve continuous fruitful results.

Najib, in response, agreed with Xi that both countries should convert their excellent ties to one that would be a model of relationship between two countries.

In a separate bilateral meeting with Chinese Premier Li Keqiang, also at the Great Hall of the People, Najib said this was a historical and auspicious year for both countries.

“The culmination of it was the signing of joint communique (between Li and I) at the same place where, 40 years ago, my father signed (a joint communique to establish diplomatic ties) with then Chinese Premier (Zhou Enlai),” he said.

Li expressed his delight to meet Najib once again.



“Malaysia is our good friend and partner among the Asean countries, and you and I have developed a personal friendship.

“China is ready to work with Malaysia to raise the relationship to a higher level,” he said.

Najib arrived in Beijing Sunday night to attend the Apec summit. He leaves for Myanmar Tuesday evening.

He is also scheduled to have bilateral meetings with New Zealand Prime Minister John Key, Russian President Vladimir Putin and Hong Kong chief executive C.Y. Leung.

Also present at the bilateral meetings are Prime Minister’s Special Envoy to China Tan Sri Ong Ka Ting, International Trade and Industry Minister Datuk Seri Mustapa Mohamed and Deputy Foreign Minister Datuk Hamzah Zainudin.

 

[hans]

Indonesia, Thailand and Malaysia are the most important country in ASEAN due to its size..
Singapore is a bit of too small..
Other countries are not that important..

Indonesian friends are very happy when Chinese guys say that Indonesia is leader of ASEAN.

 

[EastSea]

Indonesia, Thailand and Malaysia are the most important country in ASEAN due to its size..
Singapore is a bit of too small..
Other countries are not that important..

my personal opinion is that Indonesia is most important country in Asian, with population, economy, geology position, etc.

 

[Beast]

China only has problem with vietnam and Philippines. Countries not on good term with China , will not get much economic benefit. If you don't believe, ask Japan. See how is their economy perform now.

The OP report is just some neo con sensational news. Indonesia upgrade their arm forces is to counter rising vietnam and Malaysia armed forces.

 

[hans]

Yet Thailand and Malaysia is also big and important
Also the two countries are more merged into world economy, having more public influence
While Indonesia is more bigger, yet a bit of isolated and too much Muslim rules that block its influence.

my personal opinion is that Indonesia is most important country in Asian, with population, economy, geology position, etc.

 

[TheTruth]

What do Indonesians think about Philippines ethnic cleansing of Bangsamoro?

 

[Beast]

Yet Thailand and Malaysia is also big and important
Also the two countries are more merged into world economy, having more public influence
While Indonesia is more bigger, yet a bit of isolated and too much Muslim rules that block its influence.

Malaysia, too small population. Thailand not as big as Indonesia and their foreign policy is very isolated. No doubt Indonesia is the giant in ASEAN.

Actually I think the only navy in future can challenge Indonesia navy in future will be Myanmar. Their armed forces are expanding very fast.

 

[hans]

Population is not that important nowadays..
Education and technical is more important..
Indonesia is biggest in ASEAN that is correct.
Yet Thailand and malaysia are also pretty important as better in education, industry and technical.
Myanmar also has big potential. But it depends how it develops.
Myanmar has a lot of economy and race issue.

Malaysia, too small population. Thailand not as big as Indonesia and their foreign policy is very isolated. No doubt Indonesia is the giant in ASEAN.

Actually I think the only navy in future can challenge Indonesia navy in future will be Myanmar. Their armed forces are expanding very fast.

 

[Beast]

Population is not that important nowadays..
Education and technical is more important..
Indonesia is biggest in ASEAN that is correct.
Yet Thailand and malaysia are also pretty important as better in education, industry and technical.
Myanmar also has big potential. But it depends how it develops.
Myanmar has a lot of economy and race issue.

The fact Myanmar has a lot of Chinese assist helps them to kick start , gives them a huge advantage. Their ship building industries suddenly upgrade a level with recently launching a stealth frigate with Chinese shipyard assist. If they continue such trend. They can easily build up a powerful projection naval forces in short time.