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DATE=9/28/1999 TYPE=BACKGROUND TITLE=INDONESIA / AUSTRALIA RELATIONS NUMBER=5-44350 BYLINE=AMY BICKERS DATELINE=JAKARTA CONTENT= VOICED AT: INTRO: Relations between Australia and its nearest Asian neighbor, Indonesia, have deteriorated sharply since Australia assumed leadership of the multi- national peacekeeping force in East Timor. As Amy Bickers reports from Jakarta, Australia says Indonesia is deliberately trying to discredit it. TEXT: Diplomatic and commercial ties between Australia and Indonesia are under heavy pressure. Many Indonesians, from government officials to business owners to students, object to Australia's leading role in East Timor. There have been several shooting incidents and attacks at the Australian Embassy in Jakarta, a number of small protests at Australian consulates throughout Indonesia, and the local media is full of reports alleging that Australian troops are torturing militiamen. Australia's Ambassador to Indonesia, John McCarthy, says there is an ongoing campaign to damage Australia's standing and destroy the two countries' bi-lateral relationship. /// MCCARTHY ACT /// There is truly a disinformation campaign which some elements in this country are engaging in which is meant to discredit Australia and Australia's membership of the multinational force. I continue to reject it and I tell Indonesia I reject it. /// END ACT /// Australia is leading the United Nations force sent to East Timor to restore law and order after the looting and killing by pro-Jakarta militias following a vote for independence. That has triggered anti-Australian sentiment among many Indonesians. Many Australians in Jakarta say they are aware of the negative perception - a fact that Ambassador McCarthy acknowledges. /// MCCARTHY ACT /// I think a lot of Australians feel uncomfortable. My own view is that there is discomfort here but it is not necessarily acute peril. /// END ACT /// The tension is also taking a toll on diplomatic ties. Last week Indonesia's acting Foreign Minister said Australia had overstepped its authority. In addition, Jakarta has dropped a bi-lateral security treaty. The move is viewed as largely symbolic, since the pact is a broadly worded agreement which simply pledges cooperation between the two nations. The tension could take the heaviest toll on trade and business. Indonesia's government is discouraging companies from buying Australian commodities, including wheat, cotton and sugar and meat. It says it will help firms find other sources for importing these goods. Australia's trade minister said Tuesday he is concerned about that threat. These exports are worth several billion U-S dollars a year to Australia. Andre Kadarusman (pron: cad-a-roos-man) is an Australian businessman who is based in Jakarta. He says a number of Australian business people have left Indonesia,returned to Sydney, waiting for the backlash to subside. /// KADARUSMAN ACT /// The unfortunate thing is that Australia tends to be a little bit aggressive and Indonesia tends to be a little oversensitive. Whereas in the past they have managed to have a relatively happy medium (balanced relationship), now it has been blown apart. I do not think there has been a more significant issue than East Timor in the history of the Australia-Indonesian relationship. /// END ACT /// Indonesian firms have yet to cancel a single contract with Australian companies. But a trade battle could heat up. In the last few weeks Australian trade unions have imposed bans on two-way trade to protest the violence in East Timor. (SIGNED) NEB/AB/FC/BK 28-Sep-1999 08:07 AM EDT (28-Sep-1999 1207 UTC) NNNN Source: Voice of America .

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