VZCZCXYZ0001
PP RUEHWEB

DE RUEHJA #3000 2990835
ZNR UUUUU ZZH
P 260835Z OCT 07
FM AMEMBASSY JAKARTA
TO SECSTATE WASHDC PRIORITY 6818

UNCLAS JAKARTA 003000 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT PASS TO USTR SUSAN SCHWAB FROM AMBASSADOR HUME 
DEPT FOR EAP/MTS 
 
E.O. 12958: N/A 
TAGS: OVIP ETRD SENV EAID ID
SUBJECT: LETTER FROM AMBASSADOR HUME TO USTR SCHWAB 
 
 
¶1. (SBU) I wanted to thank you for agreeing to attend the Trade 
Ministers dialogue attached to the 13th Conference of Parties of the 
United Nations Framework of Convention on Climate Change (UNFCCC) in 
Bali, Indonesia on December 8th and 9th.  I want you to know we will 
do everything we can to make sure your visit is a success.  USTR's 
anti-illegal logging MOU with Indonesia is part of our forest 
conservation package for the conference. 
 
¶2. (SBU) I understand that your preliminary travel plans have you 
flying directly into Bali. If that is the case, we recommend a 
meeting for you with Minister of Trade Mari Pangestu where you could 
discuss bilateral trade issues -- including Indonesia's concerns on 
negotiating a Bilateral Investment Treaty (BIT); how progress on 
intellectual property rights directly affects foreign direct 
investment; and desired outcomes from our Trade and Investment 
Framework Agreement (TIFA) dialogue.  You could also discuss 
multilateral issues such as the WTO Doha Round and the U.S.-ASEAN 
TIFA. 
 
¶3. (SBU) I recommend additional meetings in Jakarta if possible.  A 
number of high-profile investment disputes involving U.S. companies 
are harming the investment climate and deterring foreign investment. 
 Prominent U.S. companies -- including Intel, Times Inc, Mars, Nike, 
Microsoft and others -- have expressed concerns about the pace and 
progress of investment climate reforms.  Continuing issues with rule 
of law and corruption coupled with Indonesia's new "negative list" 
of closed sectors aggravate these concerns.  Chairman Muhammed Lutfi 
and his staff at the Investment Coordinating Board (BKPM) have been 
proactive in working with us to address investor issues.  I think it 
would be useful for you to meet with Lutfi to discuss ways in which 
Indonesia can continue to improve the investment climate.  Meeting 
with Lutfi would also present an opportunity to press for 
negotiating a new OPIC agreement with Indonesia.  In addition, I 
recommend meeting with the Ministry of Agriculture to address 
Indonesia's continued refusal to allow importation of U.S. beef. 
 
¶4. (SBU) I would also suggest speaking with members of Indonesia's 
Chamber of Commerce (KADIN).  KADIN is comprised of a dynamic group 
of Indonesian businesspeople and entrepreneurs, and is growing more 
forceful and influential in its role in promoting economic reform. I 
see KADIN as a valuable ally in strengthening our trade and 
investment ties with Indonesia.  Meeting with KADIN's members would 
send a strong signal of support of their efforts to promote reform. 
 
 
¶5.  (SBU)   Thank you again for your upcoming visit.  I look forward 
to welcoming you to Indonesia. 
 
HUME