EAST ASIA SUPPLEMENT

Created: 10/19/1976

OCR scan of the original document, errors are possible

East Asia

SUPPLEMENT

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Indonesia-Australia: Relations Improve

Australian Prime Minister Praser's visit to Indonesia from1 appears to have helped ease the strains that have developed in the past year or so over Indonesia's incorporation ofTimor. Fraser arrived in Jakarta still saddled with an Australian proposal, last enunciated before the Australian Parliament on Julyy Foreign Minister Peacock, that callseasefire, troop withdrawal, some bow toa3 an internationally supervisedaid distributed through international agenciaa.

Jakarta maintains that the majority of these conditions already have been met as of Julypopular referendum" among Timorese made Timorh province of Indonesia. The Indonesians were especially upset at the timing of Peacock's remarks following their referendum and his additionalthat Indonesia had not fulfilled Australian conditions.

Although Prime Minister Fraser did notrecognize Indonesia's incorporation of Timor, neither did he focus on the four Australian conditions -Instead, in an address to the Indonesian Parliament, he emphasized that the important thing is to "look to the future* and, by implication, for bothto put the issue behind them. The Indonesians are interpreting Fraser's remarks as de factoof Indonesia'sincorporation of Timor. Suharto apparently believes that, given Fraser'a endorsement last July of Peacock's statement, his new comments represent an important concession. Suharto appears to recognize that internal political considerations prevent the Prime Minister fromJakarta's action outright.

Once Timor was out of the way, the two leaders turned to other troublesome topics. The Indonesians balked at Fraser's suggestion that Jakartaore forward position publicly on the US military

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prosence in the Indian Ocean. Suharto argued that while his government is privately aympathetic,position among third world countries would be jeopardizedublic endoraament ofosition. Nonetheless, the final communique states that both countries recognize the need to maintainalance in the Indian Ocean at asevel as possible." Thla is not only the first time Indonesia has implicitly accepted the US presence there; it ia the first time Jakarta has publicly endorsed views that cut across the AStAN conceptone of "peace, freedom and neutrality" for tha area.

The new communique caused considerableamong some elements in the Indonesian government; many of Suharto's advisers feel he let the Australians talk himosition that will hurt Indonesia in third world forums. Secretary of State Sudharmono,reaa conference after the release of tne communique, *aid that Indonesia remained "firmlytowerhe Indian OceanAustralia's stand."

Suharto apparently encouraged tha Australians toialogue with the Association of Southeast Asian Nationsnd he alsothat ASEAN would be willing to openialogue with the US. Canberra would like closer ties with ASEAN, but the five member statesMalaysia, Indonesia, Singapore and thehave baan reluctant to move too rapidly for fear other states in the area, especially communist Indochina, would view the action aa an attempt toew military alliance.

Frasar's trip changed the substance ofrelations very little, but the two leaders unquestionablyroader appreciation of the problems of the other. Suharto seams pleased with the results and has instructed his missions overseas to play up tha positive aspects of the visit. He apparently was quite impressed with Fraserand according to one intercept, feals that his rapport with the Australian Prime Minister now is

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Original document.

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