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DATE=9/23/1999 TYPE=CORRESPONDENT REPORT TITLE=INDONESIA / AUSTRALIA (L-ONLY) NUMBER=2-254241 BYLINE=JEANNE HALLACY DATELINE=JAKARTA CONTENT= VOICED AT: // Re-running w/cq cr #. No copy changes // INTRO: Australia's Ambassador to Indonesia has strongly defended his nation's policy toward East Timor. Jeanne Hallacy reports from Jakarta, the Australian diplomat's comments come at a time of mounting criticism in Indonesia over Canberra's leading role in the United Nations peacekeeping forces in East Timor. TEXT: Australia's Ambassador to Indonesia, John McCarthy says Australia did not have a bias in favor of independence during last month's referendum in East Timor and has no strategic or economic interests in the territory's independence. //MCCARTHY ACT// The reason that Australia argued for a multinational force was that neither the people nor the government of Australia could in good conscience stand aside witnessing the events which took place in East Timor after the ballot. By the way, I do not claim to have a monopoly on outrage. You Indonesians also felt that you had seen enough. //END ACT// Relations between Australia and Indonesia have deteriorated in recent weeks, as Australian sharply criticized Indonesia's failure to stop the violence in East Timor. Anti-Indonesian protests in Australia added to the break down of traditionally close ties with Indonesia. Protestors have gathered almost daily outside the Australian Embassy in Jakarta and President B-J Habibie told Members of Parliament Wednesday that bilateral ties with Australia will be reviewed in light of events surrounding the troubled Timorese territory. Shots were fired at the Australian Embassy in Jakarta earlier this week and the Indonesian government suspended a 1995 bilateral defense cooperation treaty with Canberra. Ambassador McCarthy Thursday appealed for calm in both countries. //MCCARTHY ACT// Nothing is achieved by these open expressions of hostility. It is in the interests of both our countries to cool things down. For our part, we are doing our best to do the right thing by Indonesians in Australia. //END ACT// Ambassador McCarthy spoke to a gathering of Indonesian politicians who argued that Australia's leading role in the United Nations peacekeeping force had damaged ties between the two countries. Australia has traditionally had close relations with Indonesia and was the only country to recognize Jakarta's sovereignty over East Timor. Mr. McCarthy says continued tension is in neither country's interest and that his government will try to rebuild its ties with Indonesia. (signed) NEB/JH/GC/ 23-Sep-1999 06:44 AM LOC (23-Sep-1999 1044 UTC) NNNN Source: Voice of America .

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