VZCZCXYZ0008
RR RUEHWEB

DE RUEHJA #7667/01 1692345
ZNR UUUUU ZZH
R 182345Z JUN 06
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC 5970
INFO RUEHGP/AMEMBASSY SINGAPORE 5349
RULSJGA/COMDT COGARD WASHDC
RHMFIUU/TSA HQ WASHINGTON DC
RUHGCWN/COGARD MSO DET SN

UNCLAS JAKARTA 007667 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EB/TRA/OTP (HAYWOOD) AND EB/OES/QA (DIAMOND) 
DEPT ALSO FOR EAP/IET 
COGARD FEACT YOKOTA AB JA FOR GRIFFITTS AND BLAIR 
SINGAPORE FOR COGARD GRIFFITTS 
TSA FOR J. BRECHT CLARK 
 
SIPDIS 
SINGAPORE FOR TSA 
 
E.O. 12958: N/A 
TAGS: ASEC EAIR EWWT PREL PTER ID
SUBJECT: AMBASSADOR DISCUSSES ISPS PORT REVIEW AND CIVIL 
AVIATION WITH TRANSPORTATION MINISTER 
 
REF: JAKARTA 4366 
 
¶1. (SBU) Summary.  The Ambassador urged Minister of 
Transportation Hatta Rajasa on June 12 to encourage his 
Ministry to make its best efforts to improve port security 
prior to the June 19-29 Coast Guard final review of 
Indonesian port security under the International Shipping and 
Port Facility Code (ISPS).  He noted that an unfavorable 
outcome to the review in the form of a Coast Guard 'Port 
Security Advisory' (PSA) could result in delays that would 
significantly increase costs to shipping companies, and 
seriously impact Indonesia's export and maritime-based 
economy.  While noting that some facilities in Indonesia 
already practice good security, the Ambassador summarized 
concerns the Coast Guard has identified at a number of port 
facilities, particularly poor access control and gaps in 
fencing.  Rajasa responded that port security is extremely 
important for both Indonesia's economy and international 
reputation, and directed his staff to take 'tough measures' 
to improve security conditions.  He fully agreed that 
Indonesia 'must comply' with this international standard. 
The Ambassador also reviewed progress on Bali Airport 
security and praised the Ministry of Transportation (MOT) for 
the growing cooperation with Boeing on aviation safety 
issues.  End summary. 
 
ISPS Concerns Outlined 
---------------------- 
 
¶2. (SBU) The Ambassador met Minister of Transportation Hatta 
Rajasa on June 12 to update him on the U.S. Coast Guard 
review of Indonesian ports for compliance with security 
practices under the ISPS Code.  The Ambassador noted that the 
Coast Guard had visited Indonesia numerous times since 
November 2004 for consultations and professional exchanges 
aimed at improving security, and thanked Minister Rajasa and 
his staff at the Directorate General for Sea Transportation 
(DGST) for their excellent cooperation and full access 
throughout these visits.  The Ambassador explained that a 
team of Coast Guard officials would conduct their final 
review June 19-30, visiting port facilities at Tanjung Priok 
(Jakarta), Semarang (Central Java), Dumai (Sumatra), and 
Bontang (Kalimantan). 
 
¶3. (SBU) The Ambassador described in general terms the Coast 
Guard's findings to date, including the fact that some 
facilities like the Pertamina terminal in Balikpapan maintain 
excellent security.  However, at other facilities port 
officials have made little or no progress at improving 
security, including the critical Port of Tanjung Priok in 
Jakarta.  During their May 1-5 consultations at Tanjung 
Priok, Coast Guard officials found no improvement in security 
conditions since previous visits in September 2005 and in 
March 2006 (Reftel).  The Coast Guard cited several areas of 
concern common to many facilities, including: 
 
--poor access control and checking of identification badges; 
--inadequate or poorly maintained fencing; 
--inadequate monitoring of secure areas; 
--lack of review and audit of security practices under a Port 
Facility Security Plan as approved by each facility; and 
--insufficient conduct of regular security drills and 
exercises 
 
¶4. (SBU) The Ambassador noted another serious issue is the 
DGST's issuance of Statements of Compliance (SOCs) to all of 
Indonesia's international port facilities, even though many 
clearly have never met ISPS standards.  The Coast Guard 
believes this practice casts doubt on Indonesia's credibility 
and overall implementation of the ISPS code.  Rajasa 
responded with concern to this information, and questioned 
DGST staff present at the meeting about the issue.  (Note: 
DGST has pledged to revoke SOCs if facilities are found out 
of compliance in the upcoming review.)  Rajasa also stated 
that port security is extremely important for both 
Indonesia's economy and international reputation, and 
directed his staff to take 'tough measures' to improve 
security conditions.  He fully agreed that Indonesia 'must 
comply' with the ISPS standards. 
 
Possible Impact of Coast Guard Port Security Advisory 
 
--------------------------------------------- -------- 
 
¶5. (SBU) The Ambassador also explained the process the Coast 
Guard would follow should its final review find facilities 
that fail to comply with the ISPS.  Following a 90-day 
mitigation period, the Coast Guard may issue a PSA, a public 
notice resulting in increased inspections and entry delays 
for ships entering the U.S. from Indonesia.  The PSA applies 
to any ship having visited Indonesia in the last five port 
calls.  The Ambassador warned that delays in U.S. ports for 
ships coming from Indonesia under the PSA would significantly 
increase costs to shipping companies, and seriously impact 
Indonesia's export and maritime-based economy.  This would be 
a blow to our bilateral relations, since U.S. - Indonesia 
trade relations are steadily increasing.  Under a PSA, the 
Coast Guard could also require the posting of armed security 
guards while a vessel is in a U.S. port. 
 
Steps Taken Toward Compliance 
----------------------------- 
 
¶6. (SBU) DGST officials at the meeting described briefly 
steps they have taken in the past month in preparation for 
the Coast Guard final review.  After the Coast Guard visit in 
May, Director of Sea and Coast Guard Soeharto presented a 
brief action plan on May 17 that includes a directive to DGST 
officials to revoke SOCs if the facility in question fails to 
meet ISPS standards.  Director General for Sea Transportation 
Harijogi subsequently notified in writing all 190 ISPS port 
facilities in Indonesia directing them to take immediate 
steps toward compliance with ISPS.  Inspectors from DGST 
recently visited the facilities scheduled for review by the 
Coast Guard starting June 19. 
 
¶7. (SBU) Harijogi has previously told us the DGST's greatest 
challenge is access control at Indonesia's 26 public and 
general cargo ports, because of limited government resources 
and the large number of persons who enter and exit each day 
as vendors and for employment, a part of the 'port culture' 
in Indonesia.  For their part, Coast Guard officials have 
repeatedly recommended DGST focus on achievable results, 
suggesting DGST establish internal audit teams and highlight 
facilities with good security as a bench-mark for others. 
They have encouraged DGST to focus on low-cost solutions to 
improve access control and fix other security problems. 
Should a facility be out of compliance, Coast Guard officials 
also stated they would view favorably a swift decision by 
DGST to pull an SOC.  During their May visit, the Coast Guard 
provided DGST a written list of areas for improvement at 
three Tanjung Priok port facilities the DGST hopes eventually 
to use as 'best practices' models for other ports. 
 
Impact of a PSA on U.S. Port Operators 
-------------------------------------- 
 
¶8. (SBU) Issuance of a PSA could also immediately impact U.S. 
energy and mining companies that operate private ports in 
Indonesia, or ship through public port facilities.  To 
mitigate this impact, the Coast Guard can issue an exemption 
from the PSA list to specific facilities that meet ISPS 
requirements, upon audit by an independent inspector 
acceptable to the Coast Guard.  In May 2006, Coast Guard 
officials briefed several U.S. oil, gas, and mining companies 
about the exemption process, which could affect between 
20-100 facilities across Indonesia.  Company executives 
expressed concern whether the Coast Guard would approve the 
exemptions quickly.  However, the Coast Guard officials could 
not predict a time frame for approval since it has never 
issued a PSA for a country the size of Indonesia, and 
expected that large numbers of facilities would likely apply 
for exemption at the same time. 
 
Bali Airport Security and Cooperation with Boeing 
--------------------------------------------- ---- 
 
¶9. (SBU) The Ambassador also took the occasion to discuss 
several aviation matters.  He noted significant improvements 
in security at the Bali airport, subject to a Public Notice 
by the Transportation Security Administration (TSA) since 
December 2005.  The Ambassador thanked Rajasa for the close 
cooperation of airport officials with the TSA, and noted 
 
frequent consultations in Indonesia with TSA representatives. 
 Minister Rajasa expressed the goal the airport be ready in 
the 'next couple of months', to request reassessment by TSA, 
and hopefully removal of the Public Notice.  The Ambassador 
also praised the growing relationship between Indonesian 
airlines and Boeing.  He pointed out that Boeing will conduct 
several seminars on aviation safety for key aviation 
officials and airline companies in Indonesia between June and 
October.  Rajasa clarified that recent concerns about the 
safety of Boeing 737-200 models were more about maintenance 
standards, and that the goal of 'exchanging' older planes for 
newer models 
centers on fuel efficiency, noise, and cost of maintenance. 
Citing the recent Boeing sales to Lion Air, and on-going 
negotiations with other airlines, Rajasa said "people in 
Indonesia are comfortable with Boeing".  Rajasa said he plans 
to visit Seattle in August for a ceremony at Boeing with Lion 
Air officials. 
AMSELEM