VZCZCXRO1868
OO RUEHCHI RUEHDT RUEHHM
DE RUEHJA #2248/01 2281002
ZNR UUUUU ZZH
O 161002Z AUG 07
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5817
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS PRIORITY
RUEHBY/AMEMBASSY CANBERRA PRIORITY 1015
RUEHKO/AMEMBASSY TOKYO PRIORITY 0673
RUEHBJ/AMEMBASSY BEIJING PRIORITY 4219
RUEHUL/AMEMBASSY SEOUL PRIORITY 4135
RUEHWL/AMEMBASSY WELLINGTON PRIORITY 1656
RUEHNE/AMEMBASSY NEW DELHI PRIORITY 1314
RUEHPB/AMEMBASSY PORT MORESBY PRIORITY 3398
RUCNDT/USMISSION USUN NEW YORK PRIORITY 0655
RUEHBS/USEU BRUSSELS PRIORITY

UNCLAS SECTION 01 OF 02 JAKARTA 002248 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
DEPARTMENT FOR EAP, EAP/MTS, EAP/MLS, INR/EAP 
 
E.O. 12958: N/A 
TAGS: PGOV ECON PTER ID IR
SUBJECT: PRESIDENT,S NATIONAL DAY SPEECH UPBEAT, BUT NO 
SURPRISES 
 
JAKARTA 00002248  001.2 OF 002 
 
 
¶1.  (U) This message is Sensitive but Unclassified -- Please 
handle accordingly. 
 
¶2. (SBU) Summary:  President Yudhoyono's annual National Day 
speech offered a generally upbeat assessment mixed with a 
sober recognition of the challenges facing the country.  The 
speech covered democracy, terrorism, national unity and 
separatism, Indonesia's approach as a non-permanent UNSC 
member and its national economic development priorities.  A 
speech by Speaker of the House Laksono focused on legislative 
priorities.  Mission will email a copy of the speech to 
EAP/MTS when it becomes available.  End Summary. 
 
SBY's Speech 
------------ 
 
¶3. (U) On August 16, President Susilo Bambang Yudhoyono 
delivered the annual national address on the eve of 
Indonesia's National Independence Day, August 17.  The 
nationally televised speech, which is the equivalent of the 
U.S. President's State of the Union address, was delivered 
before the Indonesian House of Representatives (DPR). 
Ambassador Hume attended.  Key speech's key themes included: 
 
-- National Unity:  Yudhoyono stressed Indonesia's national 
resilience over its 62 years of independence.  Predictions 
early in the Sukarno era and again after the fall of Suharto 
that Indonesia would break up into smaller, ethnic units had 
been proven false, the President commented.  Indonesia had 
weathered separatist challenges and stood unified facing the 
future.  Repeating a standard theme from previous years, he 
emphasized that Pancasila (the five basic principles) had 
held the country together and would remain inviolate.  Under 
no circumstances would the government support any change in 
these basic constitutional principles. 
 
-- Responsibilities of Democracy:  Nearly a decade into the 
democratic era, Yudhoyono stated, Indonesia must now pay 
attention to the responsibilities of democratic government. 
Harmony and balance were ideals that Indonesia prized and 
they should be preserved.  The challenge for Indonesia now 
was learning to use its freedom constructively.  Rule of law 
and tolerance were fundamental to the success of democracy. 
Separatism would not be tolerated.  At the same time, 
Indonesia must successfully manage the challenges of 
globalization, ensuring that development was directed toward 
a peaceful, just and democratic society.  The continuing mud 
flow in Sidoardjo in eastern Java was a problem that must be 
resolved.  The government would continue to take the lead, in 
coordination with others. 
 
-- Ethnic Conflict:  The president singled out Poso (Central 
Sulawesi), Maluku (Moluccas), Aceh and Papua as areas of 
ethnic conflict where the government had succeeded in 
preserving domestic peace and security.  (Note: 
Well-targeted police raids and personal intervention by 
Yudhoyono and Vice President Kalla in the first half of 2007 
largely ended spiraling violence between the Muslim and 
Christian communities in Poso.  Yudhoyono's visit to Ambon, 
Maluku, in July was marred by a protest which involved the 
hoisting of the banned Malukan flag. End Note.)  Aceh 
continued along the road established by the Helsinki peace 
process and MOU, although scattered conflicts pointed up the 
need for further confidence building between GAM and other 
groups.  Yudhoyono acknowledged the central government needed 
to take an active role in developing Papua, pledged to assist 
Papua and West Papua (Papua Barat) and noted his recently 
issued presidential instruction to this effect.  Papua should 
not become a source of discontent that could threaten 
Indonesia's national unity. 
 
-- Terrorism and the United Nations:  On terrorism, Yudhoyono 
praised the national police and other institutions in 
tracking down, capturing and prosecuting terrorists.  Despite 
these successes, however, Indonesia must look below the 
surface and address the roots of terrorism, including 
"backwardness, poverty, injustice, extremism, radicalism and 
a culture of violence."  Indonesia's success would benefit 
Indonesian society demonstrate Indonesia's accountability to 
 
JAKARTA 00002248  002.2 OF 002 
 
 
the international community.  On Indonesia's approach in the 
United Nations Security Council, where Indonesia will serve a 
second year as a non-permanent member in 2008, Yudhoyono 
stated that Indonesia would continue to collaborate with 
other members on the basis of a "free and active" foreign 
policy (a reference to Indonesia's tradition of 
non-alignment) and would emphasize peaceful over military 
solutions to conflicts.  He also noted that Indonesia would 
host the UN's 13th Council of Parties meeting on climate 
change in Bali in December 2007. 
 
-- Economic Development:  Coming on the heels of solid 
economic growth figures in the last quarter, Yudhoyono 
identified multiple national priorities in 2008 meant to spur 
economic growth and reduce poverty and unemployment.  The 
eight priorities were:  increase investment; encourage 
exports; enhance employment opportunities; revitalize the 
fishing and forestry sectors and promote village development; 
accelerate infrastructure development; increase the access to 
and quality of education and health; increase the 
effectiveness of the war on poverty; and fight corruption and 
accelerate bureaucratic reform.  In addition to these items, 
the government would continue to develop its capability to 
respond to natural disasters, reduce the risk of natural 
disasters and address avian influenza.  Infrastructure 
development remained crucial, with an emphasis on land, air 
and sea transportation, electricity and irrigation.  The 
government would give priority to areas recently hit by 
natural disasters.  On the positive side, Indonesia had 
achieved extensive progress on the economic front in the past 
ten years.  Indonesia had foreign exchange reserves of 
US$50.9 billion, a stable exchange rate, a reduced debt ratio 
and a healthier balance in the financial sector. (Note: 
Mission is continuing its review of the economic-related 
portion of the speech and will report further.) 
 
Speaker's Remarks 
----------------- 
 
¶4. (U) In his remarks, House Speaker Agung Laksono recalled 
highlights and themes of Indonesia's national independence 
struggle and the major changes since the fall of President 
Suharto in 1998.  Emphasizing the importance of Pancasila as 
the basis for all Indonesian national institutions, he called 
for continued unity as Indonesia faced the future.  Laksono 
reviewed the legislative agenda for 2008, including the 
national budget, institutions of government and political 
parties, fiscal reforms, national implementing legislation 
for international agreements and bilateral treaties.  He also 
discussed the controversial proposed Defense Cooperation 
Agreement with Singapore and the EU flight ban on Indonesian 
airlines, as well as the Constitutional Court's recent ruling 
to allow independent political candidates to run in elections. 
 
Upbeat, but Sober 
----------------- 
 
¶5. (SBU) As he has a right to be, Yudhoyono was upbeat about 
the incredibly fast pace of the country's democratization as 
well as guardedly confident regarding its overall 
macroeconomic situation.  That said, he was honest, noting 
the many challenges facing the country.  Papua and the 
generic warning against separatism were stark.  The president 
also dwelt a bit on the mud flow issue, stressing that the 
GOI was serious about dealing with it.  The president's 
inclusion of "radicalism and extremism" among the underlying 
causes of terrorism marks a significant advance over previous 
statements which basically mentioned "poverty" as the key 
cause of terror. 
HUME