VZCZCXRO1820
OO RUEHDT RUEHPB
DE RUEHJA #1749/01 2891127
ZNR UUUUU ZZH
O 161127Z OCT 09
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3609
INFO RUCNARF/ASEAN REGIONAL FORUM COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC

UNCLAS SECTION 01 OF 03 JAKARTA 001749 
 
SIPDIS 
 
DEPT FOR EAP, EAP/MTS, EAP/MLS, EAP/RSP, S/ECC, OES 
NSC FOR J. BADER 
EPA/OAI RAKHI,CASAT, BUCKLEY 
 
E.O. 12958: N/A 
TAGS: PREL KGHG SENV ECON KDEM ID
SUBJECT: SCENESETTER FOR EPA ADMINISTRATOR LISA JACKSON 
 
¶1.  SUMMARY:  Mission warmly welcomes EPA Administrator Lisa Jackson 
and her presidential delegation to Indonesia.  You are arriving on 
the eve of President Yudhoyono and Vice President Boediono's 
inauguration.  Ten years of political and economic reform have made 
Indonesia democratic, stable, and increasingly confident about its 
leadership role in the region.  Indonesia has held free, fair and 
successful elections; is establishing itself as an international 
leader on climate issues; and has weathered the financial crisis. 
Moreover, the Indonesian government and people are resolute in 
overcoming the terrorist threat.  Our developing Comprehensive 
Partnership will bolster Indonesia's reform efforts and advance U.S. 
interests.  Your visit will be seen as a sign of high-level U.S. 
engagement with Indonesia.  President Obama is wildly popular in 
Indonesia and his leadership has served to strengthen U.S. - 
Indonesian relations.  END SUMMARY. 
 
FREE, FAIR AND SUCCESSFUL ELECTIONS 
 
¶2.  Indonesia's April 9 legislative and July 8 presidential 
elections were free, fair, and successful.  The Election Commission, 
working hand-in-hand with provincial and local level counterparts, 
overcame daunting logistical challenges -- 451,000 polling stations 
spread among many islands -- in order to achieve this impressive 
result.  President Yudhoyono's reformist policies were clearly 
endorsed by the Indonesian people.  In April, President Yudhoyono's 
Partai Demokrat (PD) won a plurality in legislative elections, with 
20.85 percent of the popular vote (and over a quarter of the 560 
parliamentary seats).  This was followed by President Yudhoyono's 
landslide reelection victory in July.  Seen as the reformist, clean 
candidate, he further shored up his credentials by choosing a 
non-partisan, economically savvy, U.S.-educated technocrat as 
running mate.  Together they captured 60.8 percent of the vote and 
28 of the nation's 33 provinces.  The President's next step will be 
selecting his Cabinet ministers.  We expect that the new ministers 
will be announced on October 21.  The President's selections will be 
an important indicator of how he intends to move forward with his 
reform agenda. 
 
A REGIONAL ANCHOR 
 
¶3.  With 45 percent of ASEAN's population, Indonesia is the natural 
leader of Southeast Asia. The success of Indonesia's democratic and 
reform process has given the country new confidence in its 
stability, sovereignty and territorial integrity.  This new 
confidence can help the United States work well with Indonesia to 
achieve our aims in Asia.  Indonesia sits at the crossroads of 
transit between East Asia, South Asia, and the Middle East and will 
be critical to ensuring balanced and stable relations in the region. 
 As home of the ASEAN Secretariat, Jakarta seeks a greater 
leadership role in ASEAN and it is succeeding.  GOI officials 
spearheaded efforts to enshrine democracy and human rights in the 
ASEAN Charter.  During late July's ASEAN summit, Foreign Minister 
Wirajuda pressed the Burmese regime hard to release jailed democracy 
activist Aung San Suu Kyi. In its host of the Bali Democracy Forum, 
Indonesia has promoted democracy in Asia. 
 
ENVIRONMENTAL CHALLENGES 
 
¶4.  Indonesia is richly endowed with biodiversity and natural 
resources.  As the third largest global emitter, Indonesia is key to 
any global solution for climate change.  While Indonesia alone does 
not have the influence to determine a global deal on climate, its 
non-articipation or failure to achieve reductions woul cause any 
global solution to fail.  Roughly 80%of Indonesia's green house gas 
(GHG) emissions cme from the annual degradation of forests and peat 
lands, and that number accounts for about 5% of wrld emissions. 
While industrial sources of emissons in Indonesia are predicted to 
rise several fld in the coming few decad es, destruction of foress 
and peat negatively impact the world today.  I addition, the cost 
for GHG reductions from foress and peat could be much cheaper than 
other soures of global reductions. 
 
LEADING ON ENVIRONMENTL ISSUES 
 
¶5.  We believe  that President Yudhoyon is moving to make Indonesian 
leadership and conributions to a global climate solution a 
potentia achievement of his new administration.  Yudhoyonohas a 
strong record of international leadership n climate with the 
hosti(ng of COP-13, the Bali Ation Plan, the Forest-11, the Coral 
Triangle Inih(t v% and the World Ocean Conference.  He capped those 
events off with anh(istoric statement at the G-20 in Pittsburgh, 
whnn he declared that Indonesia on its own could cut emissions by 
26% from a "business-as-usual" (BAU) c"enario or 41% with 
international assistance.  Iddonesia was the first developing 
country to declr"e a percentage reduction target before Copenhagen 
 
INDONESIAN DECLARATION ON PEAT AND FORESTS 
 
 
JAKARTA 00001749  002 OF 003 
 
 
¶6.  We have encouraged Indonesian leaders to take strong moves to 
reduce emissions from the destruction of peat lands, including a 
presidential declaration, having the force of law, to ban further 
conversion of peat lands.  Such a move would bring credence to the 
targets that Yudhoyono voiced at Pittsburgh.  But Yudhoyono would 
need clear support from the U.S. and other major donors to take this 
bold step.  Advisors and Indonesia climate experts repeatedly say 
that Yudhoyono must be armed with viable alternatives for the vested 
interests if he is to effectively change behavior.  Possible US 
climate legislation that creates a carbon market with international 
offsets, including "avoided deforestation," would provide the 
incentives to Indonesia for saving its forests and peat lands. Short 
of a ready announcement on U.S. legislation, there is a smaller, but 
significant package of U.S. assistance that could be characterized 
as seed support. 
 
U.S. SUPPORT ON ENVIRONMENTAL ISSUES 
 
¶7.  U.S. bilateral activities include USAID's planned $150 million 
in climate-related assistance on mitigation on forestry and energy 
and adaptation on marine and water/sanitation.  In addition to the 
Tropical Forest Conservation Act (TFCA) recently launched in Sumatra 
for $30 million, the U.S. is considering other sites for TFCA deals. 
 However, the totaling of the assistance packages by other major 
donor nations could possibly reach up to a billion dollars.  This 
would make an even more compelling case for Indonesia to take 
positive game-changing action. International donors resident in 
Jakarta have said they welcome U.S. leadership in pressing Indonesia 
for policy change and renewed engagement on donor assistance on 
climate, and we have begun active coordination in Jakarta mirroring 
S/ECC actions in the various international negotiation fora. 
 
A GROWING ECONOMY 
 
¶8.  With estimated growth of four percent for 009,Indonesia is the 
third-fastest growing economy in the G-20. Indonesians are proud of 
their transition over little more than a decade from economic basket 
case during the Asian financial crisis to member of the G-20, 
coordinating global responses to the crisis.  Although some of 
Indonesia's responses to the economic crisis have been 
protectionist, new opportunities for U.S. businesses are emerging. 
Boeing has a huge order book with Indonesian airlines.  General 
Electric is competing for a several hundred million dollar 
locomotive deal.  The Export-Import Bank is looking for 
opportunities to finance clean energy deals and is exploring ways to 
decrease the costs for lending in Indonesia.  And OPIC is 
negotiating a new Investment Incentive Agreement with Indonesia. 
 
OVERCOMING SECURITY THREATS 
 
¶9.  Indonesia's response to the July 17 terrorist attacks on two 
hotels in Jakarta has been swift.  The government has heightened 
security nationwide, and the police have worked steadily to find the 
masterminds of the attack.  Noordin Mohammed Top, who is suspected 
of involvement in every anti-Western terrorist attack in Indonesia 
since 2002, including the July 17 bombings, was killed in a police 
raid, along with three other suspects last month. While Indonesia's 
counterterrorism efforts have been impressive and its capacity to 
fight terrorism within its borders has improved steadily, continued 
vigilance is needed, as the events of July 17 demonstrated.  The 
U.S. provides Indonesia key assistance for its counterterrorism 
effort. 
 
A COMPREHENSIVE PARTNERSHIP 
 
¶10.  President Yudhoyono proposed that the U.S. and 
Indonesia launch a Comprehensive Partnership in his November 2008 
speech in Washington.  Secretary Clinton's visit in February 2009 
was a critical step in beginning a dialogue with Indonesians about 
the key elements of that partnership.  Under a Comprehensive 
Partnership, we will strengthen Indonesia's democratic institutions 
and capacity to promote democracy beyond its borders.  The 
partnership will allow us to expand our already robust regional 
security cooperation and deepen our cooperation with the Indonesian 
military to enhance its capability to provide disaster relief and 
participate in international peacekeeping operations.  We will 
promote the people-to-people ties that are critical to the success 
of our partnership, including concluding an agreement on Science and 
Technology cooperation, bringing the Peace Corps back to Indonesia, 
and expanding education cooperation. 
 
INDONESIA: AN IMPORTANT U.S. PARTNER IN DEMOCRACY 
 
¶11.  Our security relationship with Indonesia is only one dimension 
of a robust partnership.  Indonesia's democratic institutions are 
flourishing.  Indonesian consumer confidence rose in July to its 
highest level in nearly five years.  Although much work remains to 
be done in educational reform, poverty alleviation, combating 
 
JAKARTA 00001749  003 OF 003 
 
 
corruption, improving security, and reducing environmental 
degradation, Indonesia is emerging as a leader in ASEAN, G-20 and 
other multilateral fora on the global stage.  Our Comprehensive 
Partnership with the world's third largest democracy and the largest 
Muslim-majority nation is an opportunity for the United States to 
promote its interests bilaterally, regionally, and internationally. 
 
 
Hume#