Minister for Defence – Australia and Indonesia: Strategic Partners

Paper presented by

Minister for Defence

Stephen Smith MP


Australia and Indonesia:

Strategic Partners





4 September 2012



Thank you for that introduction, Joe [Cochrane].

I acknowledge the presence tonight of Minister for Defence Dr Purnomo Yusgiantoro.

I am also pleased to welcome members of the Indonesia-Australia Defence Alumni Association (IKAHAN) and representatives of the Strategic Review Journal.

“IKAHAN” was launched less than 18 months ago and already has a constituency of over 800 members, a testament to the close links between our Defence forces.

The Strategic Review Journal is even younger than IKAHAN, having been officially launched in July by President Yudhoyono. I welcome very much the positive contribution by IKAHAN and the Strategic Review to the Defence and Security debate in both Indonesia and Australia.

I am pleased to be in Jakarta again. This is my seventh visit to Indonesia as a Minister in the Australian Government and my first visit as Minister for Defence.  This is my sixth meeting with Defence Minister Purnomo in less than two years.

Geography and history placed Australia and Indonesia together as neighbours.  Today we are much more than that.  Shared values, shared interests, shared challenges, have seen us become strategic partners.

Indonesia has transformed into an open and robust democracy in our region. It is the world’s third largest democracy.

Great potential exists to promote trade and investment links between Australia and Indonesia, the two largest economies in our region. Indonesia is a central part of the Asian success story, with its economy forecast to almost double in size over the next 10 years.

Indonesia, with Australia, as members of the G20, have worked together to confront the challenges of the Global Financial Crisis.

With a profoundly changed and changing political landscape and our bilateral relationship at an historic high, Australia and Indonesia are now presented with a unique opportunity to broaden and deepen our strategic partnership.

Today, Indonesia is a nation now taking on a key leadership role in our region and on the global stage. Australian strongly supports such a leadership role for Indonesia.

Bilateral relationship

Indonesia and Australia are increasingly important and valuable partners with strong political, security, trade, investment, development and people-to-people links.

Central to the modern day relationship between Australia and Indonesia is the Lombok Treaty, which sets the framework for our bilateral relationship, including our security and strategic cooperation.

The Lombok Treaty establishes the modern framework for cooperation between Australia and Indonesia in defence, law enforcement, counter-terrorism, maritime security and disaster response.  The Treaty makes clear that each country respects and supports the sovereignty, territorial integrity, national unity and political independence of the other.

The importance of the strategic and security relationship between Australia and Indonesia is reflected by the Lombok Treaty, which came into effect when I exchanged notes on the Treaty with then Indonesian Foreign Minister Dr Wirajuda in Perth in February 2008.

Tomorrow in Jakarta, Defence Minister Dr Purnomo and I will sign the Defence Cooperation Arrangement, which introduces the formal framework for practical Defence cooperation under the Lombok Treaty.

That Indonesia is of great strategic importance to Australia is demonstrated by the number of regular and high-level dialogues we conduct. There have been over 100 two-way ministerial visits since January 2008.

I am pleased to be here in Jakarta for the inaugural Annual Indonesia-Australia Defence Ministers’ Meeting.

This follows from the Australia-Indonesia Leaders’ Meeting in Darwin in July and the first 2+2 Foreign and Defence Ministers meeting in Canberra in March this year.

This has been the fourth occasion this year I have met with Minister Purnomo, a testament to our close bilateral relationship.

Australia’s Minister for Infrastructure and Transport, Anthony Albanese and Minister for Home Affairs and Defence Materiel, Jason Clare, accompanied me to Jakarta this week to discuss increasing maritime and transport safety cooperation with our Indonesian counterparts.

Minister Clare and I will tomorrow also hold discussions with Indonesian defence industry representatives to explore opportunities for future cooperation between our respective Defence industries.

The importance and significance of the Australia-Indonesia relationship will only continue to grow as strategic weight shifts to our neighbourhood, the Asia Pacific.

A Dynamic Region

In this century, the Asia-Pacific and the Indian Ocean Rim will become of paramount strategic importance.

Some commentators have called this era the beginning of an Asian Century. President Yudhoyono said in his keynote speech at the Shangri-La Dialogue in June that he is more inclined to call it the Asia-Pacific Century.

I argue that we can broaden further the term to Indo-Pacific, noting that there will be three strategic powers in our region – the United States, China and India with critical economic prowess and political influence.

This will see an adjustment in the balance of power across the region and around the globe. 

The rise of China is a defining element in this, but it is far from the only or whole story.

The rise of India is still under-appreciated, as is the rise of the ASEAN economies combined.

The Indian Ocean already ranks among the busiest highways for global trade. It will become a crucial global trading thoroughfare in the future. 

It is vital for trade, investment and prosperity that these sea lanes are protected from threats such as piracy or maritime terrorism.

The major and enduring economic strengths of Japan and South Korea also need to be acknowledged.

So must the great individual potential of Indonesia, an economy which has grown steadily over the past few decades, and with an equally positive forecast.

As Indonesia has become an important part of the global economy, its strategic importance and weight in the region and the globe has grown commensurate with its economic influence.
This will continue.

Strong regional partnerships require relationships of trust and transparency. And it is in that spirit that Australia will be engaging closely with Indonesia on Australia’s new 2013 Defence White Paper.

Australia’s New Defence White Paper

In May, Australia announced that we will deliver a new Defence White Paper in the first half of 2013.

As I have said privately to my Indonesian Ministerial counterparts and publicly in Australia, I am committed to regular, open and transparent discussions with Indonesia on the development of Australia’s 2013 Defence White Paper. This is appropriate given the maturity of our bilateral relationship and our strategic partnership.

This was part of our discussions during the Defence Ministers’ Meeting in Jakarta today.

Australia will deliver a new Defence White Paper one year earlier than previously planned in response to significant events domestically and in our region. 

These include: 

• The ongoing strategic shift to our region, the Asia Pacific and the Indian Ocean Rim, particularly the shift of economic weight to our region;

• The Australian Defence Force’s (ADF) operational drawdown from Afghanistan, East Timor and the Solomon Islands;

• The United States’ re-balance to the Asia Pacific and Australia’s enhanced practical cooperation with the United States pursuant to our Alliance relationship;

• The completion of Australia’s own Force Posture Review – the first in a quarter of a century; and

• The ongoing adverse effects of the GFC, which have continued to have a significant negative impact on the global economy.

While these are all significant strategic developments, they have been in the nature of an evolution, and therefore the core strategic interests of the 2009 White Paper will remain the same for the 2013 White Paper, notably that:

• Australia’s most basic strategic interest remains the defence of Australia against direct armed attack;

• The security, stability and cohesion of our immediate neighbourhood is a strategic priority for Australia;

• Australia has an enduring strategic interest in the stability of the wider Asia-Pacific region; and

• Beyond South-East Asia and the Asia Pacific region, Australia has a strategic interest in preserving an international order that restrains aggression by States against each other, and can effectively manage other international risks and threats, including from non-state actors.

The 2013 Defence White Paper will address these core interests as well as changing strategic circumstances.

Australia-Indonesia Defence Relationship

The Lombok Treaty commits Australia and Indonesia to support each others’ unity and territorial integrity, and to refrain from the threat or use of force against each other. 

The commitments in the Lombok Treaty will be implemented in the Defence Cooperation Arrangement which Minister Purnomo and I will sign tomorrow.

The Arrangement strengthens the relationship between our two Defence organisations and provides a strong framework for an expanded program of Defence engagement over the coming years.

In recent years, we have steadily increased our program of engagement and 2012 will see the highest tempo of bilateral defence engagement, exercises and training in 15 years.

Personnel exchanges are strong, spearheaded by frequent reciprocal visits by senior military personnel and high level dialogue.

The strength of personnel links was recognised with the establishment last year of the Indonesia-Australia Defence Alumni Association.

Last year, Australia hosted a visit by the Indonesian Chief of Defence Force (Panglima TNI), the first such visit since 2007. Last week, Australia’s Chief of the Defence Force General Hurley visited Indonesia.

Senior political Dialogue is complemented by regular senior level officials’ Dialogue, including the Indonesia-Australia Defence Strategic Dialogue and regular Army to Army, Air Force to Air Force and Navy to Navy Talks.

Australia’s practical cooperation with Indonesia covers counter-terrorism, maritime security, humanitarian assistance and disaster relief, peacekeeping and intelligence sharing.

This year, the Australian and Indonesian navies conducted a third Coordinated Maritime Patrol of our shared maritime borders.

Today I agreed with Minister Purnomo that we would look to expand our program of Coordinated Maritime Patrols.

Counter Terrorism Exercises DAWN KOOKABURRA and KOMODO involve Australian and Indonesian Special Forces, are held annually in Australian and Indonesia.

We conduct biennial counter-hijack and hostage recovery exercises.

Indonesia participated in Exercise Pitch Black for the first time in 2012 and this was also the first time Indonesian Sukhoi fighter aircraft have participated in an exercise outside Indonesia.

We are also working to increase our cooperation with Indonesia in the important field of peacekeeping. Preparations have begun for a bilateral peacekeeping exercise to occur in 2013.

These activities build on traditional cooperation in officer and English language training. ADF officers undertake training and exchanges in Indonesia, and this year over 150 positions were offered to Indonesian students in over 50 courses in Australia under the bilateral Defence Cooperation Program.

In July in Darwin, to coincide with President Yudhoyono’s visit, Australia and Indonesia signed a Memorandum of Understanding (MOU) setting out arrangements for the gifting of four ADF C-130H aircraft to Indonesia. This will help lift Indonesia’s capacity to respond to humanitarian and natural disasters and potentially sets the stage for further cooperation between our defence industries.

We have commenced discussions on the possible sale of further C-130Hs to Indonesia.

I look forward to building on the momentum in the Defence relationship with strengthened strategic dialogue and an ambitious program of practical cooperation.

Australian and Indonesia are working together to build our respective peacekeeping capabilities. Australia is providing support to Indonesia’s Peace and Security Center at Sentul through English language training.

Regional Cooperation

Australia supports Indonesia’s leadership in the region and its advocacy for a secure and stable South East Asia. I welcome very much Indonesia’s efforts to strengthen regional architecture, including its successful chairing last year of ASEAN and the East Asia Summit (EAS).

Australia very much welcomed the entry of the United States and Russia into an expanded EAS last year. The United States and Russia joined with ASEAN countries plus Australia, China, India, Japan, New Zealand and the Republic of Korea.  

Presidents and Prime Ministers, Foreign Ministers and Defence Ministers from all key countries in the region can now meet in EAS format to discuss the full gamut of issues, from the economy and trade and investment through to peace and security.

Australia strongly supported the inaugural meeting of the ASEAN Plus Defence Ministers Meeting (ADMM Plus) in Hanoi in October 2010 and looks forward to the second meeting in Brunei in 2013, and subsequently at two year intervals.

Indonesia co-chairs the ADMM-Plus Expert Working Group on Counter Terrorism with the United States, while Australia co-chairs the ADMM Plus Expert Working Group on Maritime Security with Malaysia.

Australia also welcomes Brunei’s proposal to host a humanitarian assistance and military medicine exercise in conjunction with its Chairing of the 2013 ADMM Plus meeting.

India, Indonesia and Australia can together provide regional leadership, including through the Indian Ocean Rim-Association for Regional Cooperation (IOR ARC), a Ministerial level forum with membership ranging across the Indian Ocean rim.

After India’s current period as IOR-ARC chair, Australia will serve as chair for the subsequent two year period, with Indonesia serving as vice chair and then chair thereafter. 

Together, India, Australia and Indonesia can provide regional leadership through a forum that has much potential for dealing with regional challenges. This reflects a natural extension of significant and growing bilateral relationships between the three countries.


As Indonesia’s democracy consolidates further, as economic strengths are realised through economic reform, and as Indonesia’s voice in regional and international affairs becomes even stronger, we see a genuine partnership with a neighbour and friend. A partnership that continues to expand into new areas and helps underpin the security and prosperity of both our nations.

As Indonesia’s regional influence and leadership becomes global in nature, Indonesia’s importance to Australia will only grow.  I see the unique partnership between Australia and Indonesia an asset in supporting our region’s ambitions for peace, security and stability and investment and prosperity.

Thank you for the opportunity to speak this evening.

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