VZCZCXRO0570
OO RUEHCHI RUEHCN RUEHDT RUEHHM
DE RUEHJA #0858/01 1200938
ZNR UUUUU ZZH
O 290938Z APR 08
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8865
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS PRIORITY
RUEHBY/AMEMBASSY CANBERRA 2418
RUEHKO/AMEMBASSY TOKYO 1896
RUEHWL/AMEMBASSY WELLINGTON 2592
RUEHLM/AMEMBASSY COLOMBO 0992
RUEHKA/AMEMBASSY DHAKA 0936
RUEHNE/AMEMBASSY NEW DELHI 1797
RUEHPT/AMCONSUL PERTH 0752
RUEHHK/AMCONSUL HONG KONG 2635
RHEFDIA/DIA WASHINGTON DC
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHDC
RHHJJPI/USPACOM HONOLULU HI
RUEKJCS/SECDEF WASHDC

UNCLAS SECTION 01 OF 05 JAKARTA 000858 
 
SIPDIS 
SENSITIVE 
 
DEPT FOR EAP, EAP/MTS, EAP/MLS, EAP/RSP 
NSC FOR E.PHU 
 
E.O. 12958: N/A 
TAGS: PGOV ECON PINS PHUM ID
SUBJECT: ACEH -- AMID CHALLENGES, PEACE PROCESS PROCEEDS 
 
JAKARTA 00000858  001.2 OF 005 
 
 
¶1.  (U) This message was coordinated with Consulate Medan. 
It is Sensitive but Unclassified. 
 
¶2.  (SBU) SUMMARY:  Although rising criminal violence and a 
poor medium-term economic outlook continue to hamper progress 
in Aceh, the political outlook in the province has improved. 
 While several issues will need careful management in Jakarta 
and Aceh, the prospects appear good for continued peaceful 
transition, leading up to regional parliamentary elections in 
April 2009. 
 
¶3.  (SBU) SUMMARY (Cont'd):  Positive factors in this 
scenario include increased attention to the task of 
governance and institutionalization of the peace process with 
Jakarta.  Moreover, the splintering of the GAM ("Free Aceh 
Movement") camp could lead to some internal violence but 
should give rival parties significant opportunity as the 
province heads into the election campaign.  Overall, 
prospects appear cautiously favorable for the direct election 
of the first post-conflict provincial legislature within the 
next year.  END SUMMARY. 
 
PEACE PROCESS MOVING FORWARD 
 
¶4.  (SBU) The military and police in Aceh, which remain under 
national commands, are less of an issue than previously, and 
their operations in Aceh are gradually becoming more 
consistent with national norms.  The police are not 
particularly effective, but the new police chief, who is a 
native Acehnese, has Irwandi's support, and performance is 
slowly improving.  The military has by and large receded into 
the background, and is working to win the confidence of the 
civilian population, although that process will take time. 
Its chief, however, is not Acehnese, and the long-term role 
of the military in Aceh remains an issue in the peace process. 
 
¶5.  (SBU) Aceh and Jakarta are working together through the 
Forum for Communication and Coordination (FKK) to resolve 
outstanding issues relating to the Helsinki MOU, which the 
government of Indonesia and GAM signed in August 2005, 
formally ending the conflict.  The FKK, created to be the 
eyes and ears of the national Coordinating Ministry for 
Politics, Law and Security in Aceh, had the ostensible role 
of coordinating with Aceh elements on security issues after 
the signing of the MOU.  It has since become the main 
dialogue partner in the peace process.  The body is headed by 
a TNI general who coordinates closely with the ministry's 
Aceh group, composed of officials from military, police, 
finance, home affairs and the state planning agency. 
 
¶6.  (SBU) On the Aceh end, the dialogue has been broadened, 
with Irwandi's support, through a recently-created Commission 
to Support Peace in Aceh (CoSPA).  Launched in February by 
the BRA's Aceh Peace Research Center, it includes Aceh 
government officials, military and police officials and 
international observers from the United States and the EU. 
The participation of the Aceh provincial government and 
senior provincial judicial and legislative officials attests 
to CoSPA's acceptance within the Aceh government.  CoSPA has 
not been formally endorsed by Coordinating Minister Widodo 
but has his support, and FKK representatives play a leading 
role in it, effectively making it a part of the Aceh-Jakarta 
dialogue through the FKK.  Recent meetings have discussed the 
establishment of a Truth and Reconciliation Commission for 
Aceh and progress on establishing a Human Rights Court for 
Aceh to try cases arising from the conflict.  It intends to 
explore mechanisms to establish a joint claims commission as 
required under the MOU. 
 
¶7.  (SBU) There is a mutual recognition that a gap remains 
between the Helsinki MOU and the LOGA, but Jakarta and GAM 
differ over the extent to which the gap can be closed and how 
that might be done.  The national government considers the 
LOGA to be comprehensive and final in terms of defining 
 
JAKARTA 00000858  002.2 OF 005 
 
 
Aceh's regional autonomy.  A set of implementing regulations 
currently being drafted, however, allows leeway in 
interpreting the LOGA's provisions, thereby closing the gap 
with the MOU.  Irwandi is working with the FKK to resolve the 
outstanding issues.  Jakarta appears to want to resolve all 
issues and release the regulations through presidential order 
before the end of 2008, well ahead of the April 2009 DPRD 
elections.  That may be overly optimistic. 
 
GETTING DOWN TO GOVERNING 
 
¶8.  (SBU) With slightly more than one year in office under 
their belts, Governor Irwandi Yusuf and Vice Governor Muhamad 
Nazar seem to be finally figuring out how to govern.  The 
same can be said generally of district and municipal leaders. 
 GAM-affiliated or otherwise, those with technical or 
academic backgrounds have learned quickly and appear to be 
managing their districts reasonably well.  Difficulties 
remain in the central highlands, where the indigenous Gayo 
joined anti-independence militias during the GAM conflict and 
remain at odds with Irwandi. 
 
¶9.  (SBU) One of the main criticisms of Irwandi's 
administration had been his neglect of the business of 
governing, due in large part to his extensive travels during 
the first year after his election in December 2006.  That 
picture has begun to change for the better in recent months. 
In March, after conducting a meritocratic "fit and proper 
test" and personal interviews, Irwandi appointed 42 people to 
senior positions on the basis of their test results, 
experience and qualifications.  The move has built trust 
between Irwandi and the bureaucracy and demonstrated his 
readiness to work with the bureaucracy, representatives of 
which he has begun to include in key meetings.  The move has 
also lent credibility insofar as Irwandi did not stock his 
cabinet with loyalists. 
 
¶10.  (SBU) The friction between the governor and Aceh's 
parliament during Irwandi's first eight months in office has 
also subsided substantially.  The relationship has matured, 
reflecting a mutual recognition of their respective roles in 
governing the province.  Little more than a rubber stamp 
during the conflict, the provincial legislature is, with 
Irwandi's cooperation, beginning to carry out its duty to 
review the budget and help run the province.  Although months 
behind schedule now, the budget is bouncing between the 
parliament and the executive, as the parliament for the first 
time ever exercises its authority to ask questions. 
 
GAM FRAGMENTATION OFFERS CHANCE FOR RIVAL PARTIES 
 
¶11.  (SBU) There is no question that the level of criminal 
violence in Aceh is dramatically higher than anywhere else in 
Sumatra, if not the rest of Indonesia.  There have been some 
killings, and the provincial police chief is investigating 
three to four kidnappings per month.  With few exceptions, 
the motive has been money, not politics.  Fights have broken 
out between GAM and other groups, and among rival GAM groups. 
 Many blame the violence on GAM, while GAM blames it on 
regular criminals and ex-militia.  In many localities, GAM 
groups are essentially simple preman (gangs of petty thugs), 
with little or no ideological affinity for independence.  At 
current levels, neither the crime nor GAM's involvement in it 
appear to be significant enough to affect long term political 
stability of the province.  They do, however, interfere with 
the provision of government services and deter investment and 
job creation. 
 
¶12.  (SBU) In the meantime, GAM continues to fragment, and 
Malik Mahmoud, one of the former expatriate GAM leaders and 
the current head of GAM insofar as it still exists as an 
organization, is becoming less and less relevant and less 
able to influence the behavior of individual members.  Malik, 
as he is known in Aceh, and Irwandi remain estranged, and the 
 
JAKARTA 00000858  003.2 OF 005 
 
 
eight GAM-affiliated district leaders are all generally close 
to Irwandi, as are several other prominent ex-GAM leaders. 
As Governor, Irwandi thus easily controls far more real power 
than Malik.  GAM's application for formal status as a 
political party with a new name, flag and symbol is still 
being reviewed in Jakarta.  Whether approval will be 
forthcoming is an open question. 
 
¶13.  (SBU) At least six different groups have formally 
applied to register as political parties; none have been 
approved so far.  None of these parties has a platform 
promoting sharia law, and public support for sharia law 
appears to be declining.  Irwandi has worked to minimize the 
scope of Sharia activities in practice.  At the same time, 
Hizbut Tahrir Indonesia (HTI) and the Islamic Defenders Front 
(FPI) are significantly expanding their influence in Aceh, 
particularly on university campuses. 
 
¶14. (SBU) National and rival local parties hope to prevent a 
GAM victory in the 2009 legislative elections.  Their 
prospects of doing so appear significant.  Although still 
regarded as the champion of Aceh's autonomy and cultural 
identity, GAM lacks broad support, and the elements of its 
fractured organizational structure do not work together. 
Nazar's proto-party, SIRA (Aceh Referendum Information 
Center) has a machine as good as or better than GAM's, is 
less controversial and is capable of peeling the 
intellectuals away from GAM, when SIRA formally establishes 
itself. 
 
¶15.  (SBU) Looking ahead to the provincial legislature (DPRD) 
to be elected a year from now, Irwandi's nonpartisan stance, 
should he choose to continue it, should allow him to work 
effectively with a non-GAM DPRD, dominated either by a 
national party such as Golkar or by local parties.  A PDI-P 
DPRD would be a problem, but PDI-P has no chance of winning 
significant representation.  Pragmatism on all sides will be 
essential to a successful working relationship with the new 
legislature. 
 
A ROBUST BUDGET 
 
¶16.  (SBU) Despite its substantial gas reserves and history 
of exporting commodities such as pepper and coffee, Aceh has 
long been one of the country's poorest provinces. Decreased 
reconstruction spending has caused the economy to cool, and 
significant new investment--foreign or domestic--has yet to 
materialize. 
 
¶17.  (SBU) Provincial finances, however, are not a problem, 
due primarily to a substantial influx of revenue sharing from 
Jakarta as a result of national decentralization laws, and 
the special Aceh Trust Fund established under the LOGA.  The 
province stands to lose 25 percent of the annual block 
transfer from Jakarta under the General Allocation Fund 
(DAU), or approximately $15 million, due to the budget's late 
submission.  Even with that loss, however, the province's 
financial situation is very strong, and the budget, totalling 
approximately $900 million, will be nearly double the level 
of last year's.  That makes it nearly three times that of 
North Sumatra, a larger and wealthier province. 
 
¶18.  (SBU) The Aceh Reconstruction Agency (BRR), established 
in April 2005 in response to the massive earthquake and 
tsunami disaster of December 2005, will close operationally 
by the end of 2008, although it will formally remain in 
existence until its five-year anniversary in April 2009.  As 
a fulfillment of Jakarta's commitments to Aceh following the 
2004 tsunami, the BRR represents as a major success, and is 
regarded as such by the international donor community. 
 
¶19.  (SBU) The BRR's favor has fallen among civil society 
and, increasingly, the public in Aceh, however.  While some 
of the criticism is unfair, critics rightly note that the 
 
JAKARTA 00000858  004.2 OF 005 
 
 
agency's strong performance in Banda Aceh has been offset by 
weak performance in more remote areas.  Critics complain that 
BRR is out of touch with common people, is unresponsive to 
local concerns, and spends profligately on itself and its 
staff.  Its closure is important symbolically as a cutting of 
the umbilical cord, accentuating Aceh's autonomy in a 
positive way.  It will close before completing its work, 
however, and its assets will most likely be transferred to 
the State Planning Agency (Bappenas).  How the responsibility 
for remaining projects will be divided between Jakarta and 
Aceh remains to be decided, and this will create some 
friction, but it should not become a major political issue. 
 
CHALLENGES AHEAD 
 
¶20.  (SBU) Several challenges remain for Irwandi in this 
outlook, and his ability to manage them will affect the peace 
and the political stability of the province.  One of them is 
GAM's formal boycott of the CoSPA, limiting the effectiveness 
of the decisions and agreements that it aims to produce. 
Malik and other GAM leaders continue to boycott the process, 
and any ex-GAM participants in CoSPA participate as 
individuals, not on behalf of the organization.  Malik 
objects to the presence on the CoSPA secretariat of senior 
members of BRA, with which Malik is on bad terms.  Malik 
instead engages with Jakarta counterparts through the 
so-called Roundtable, an ad hoc, informal GAM dialogue with 
Jakarta.  Irwandi wants GAM in the CoSPA, and Malik's 
participation as the informal head of GAM would be 
symbolically important because he signed the MOU on behalf of 
GAM. 
 
¶21.  (SBU) Malik has instead continued to maintain a dialogue 
with Jakarta, which in that respect competes with the 
FKK-CoSPA process.  The Roundtable, as this dialogue is 
called, has been encouraged by Juha Christensen from 
Interpeace, who was involved in the European Union's Aceh 
Monitoring Mission (AMM) and sees himself as wearing the 
mantle of Finnish President Ahtissaari.  Jakarta counterparts 
consist of former Justice Minister Hamid Awaluddin, Jakarta's 
signatory of the Helsinki MOU, as well as State Enterprise 
Minister Sofyan Djalil, Deputy Welfare Minister Farid Husain 
and former Indonesian envoy to Finland Iris Indira Murti, all 
of whom played important roles in negotiating the MOU. 
Husein is also close to Kalla and a negotiator of the MOU. 
None of the Jakarta participants, however, holds an office 
relevant to the dialogue with Aceh. 
 
¶22.  (SBU) As essentially a glorified photo-op for Malik and 
his Jakarta partners, the Roundtable has little intention of 
contributing substantively to the resolution of the remaining 
MOU issues, although at the very least it demonstrates the 
two sides' continued commitment to the peace process. 
Coordinating Minister Widodo is reportedly pressing Kalla to 
close down the Roundtable and channel all contact with GAM 
through the FKK.   This would significantly increase the 
weight of any results from the FKK-CoSPA process. 
Ultimately, however, Irwandi has the political power as 
governor and the influence as a former GAM leader to reach 
agreement with Jakarta on the remaining MOU issues, and GAM 
will most likely learn to live with what he decides. 
Although Malik's formal endorsement of that agreement is 
desirable symbolically in socializing GAM compliance, it is 
not absolutely essential, and Irwandi can push the peace 
process forward, with or without Malik's blessing. 
 
¶23.  (SBU) The Aceh Reintegration Agency (BRA), which is part 
of the post-Helsinki peace process, continues to fall short 
in administering the agreed programs intended to reintegrate 
former GAM members into society and remains a source of GAM 
discontent.  BRA lacks the capacity to do more than 
investigate and pay claims to victims of violence, former 
combatants, and other groups which have been promised 
compensation in the Helsinki MOU.  Its mission historically 
 
JAKARTA 00000858  005.2 OF 005 
 
 
has not been well defined.  Its head, Nur Juli, has not been 
an effective manager.  Senior GAM officials accuse Nur, 
somewhat disingenuously, of discriminating against certain 
GAM factions in compensating victims of violence.  The DPRD 
has begun to play a much-needed role in balancing the 
interests of provincial stakeholders by pressuring BRA to 
ensure that it treats all victims of violence equally when 
carrying out its programs.  Although some of the GAM 
complaints may be opportunistic, any headway that Irwandi can 
make in GAM satisfaction with the BRA should encourage GAM to 
buy into the peace process. 
 
¶24.  (SBU) A final dark cloud on the horizon is the proposal 
that Aceh be split into as many as three provinces.  Despite 
low prospects of adoption anytime soon, the proposal has been 
politically divisive.  Launched by the ethnic Gayo and other 
minority communities in the central highlands, it would carve 
out a smaller second and possibly a third province comprising 
the districts of Central Aceh and Gaya Lues and the most 
economically backward regions along the west coast.  These 
communities have lobbied the DPR and national authorities 
directly on this issue. 
 
¶25.  (SBU) Irwandi has denounced the proposal and said it 
would reignite the conflict.  There are only two 
precedents--Banten and Riau--for the division of a province 
without the governor's consent.  Such a move, however, would 
violate the Helsinki MOU.  DPR contacts say the split isn't 
going to happen anytime soon and appear sanguine.  The 
proposal's significance, rather, lies in its potential to 
divide the province against itself and polarize relations 
between Aceh and Jakarta.  It has already led to violence 
between GAM and ethnic Gayo.  Nationalist parties, such as 
the Party of Democratic Struggle (PDI-P) and Hanura stand to 
profit from the agitation.  Former President Megawati (PDI-P) 
sees Aceh's special autonomy as a repudiation of her hard 
line as president, and retired General Wiranto (Hanura), who 
oversaw the imposition of martial law in Aceh, reportedly 
campaigned recently in central Aceh. 
 
SOME GROUNDS FOR CAUTIOUS OPTIMISM 
 
¶26.  (SBU) None of these challenges, however, is serious 
enough by itself to derail the peace process or Aceh's 
political stability.  Irwandi's ability to manage them will 
likely translate into reduced GAM resistance as the peace 
process continues to inch its way forward.  Barring 
unanticipated conflicts and active efforts to divide the 
province, there is no reason to expect the former conflict to 
return, but political competition in the run-up to next 
year's provincial elections will be intense. 
 
 
HUME