Washington — Indonesia’s newly inaugurated President Prabowo Subianto set off for China on Friday for his first international trip as president.
“From Beijing I will fly directly to Washington, D.C., on the invitation of the U.S. president,” said Prabowo upon departing Jakarta. Indonesians often refer to public figures by their first names.
His tour aims to “cultivate good relations with all parties,” Prabowo said. He has stated his ambition to raise Indonesia’s international profile and made early foreign policy moves, including a surprise decision to join Southeast Asia’s largest economy to the BRICS bloc.
BRICS, which stands for Brazil, Russia, India, China and South Africa, comprises a growing group of emerging economies and is seen as a counterweight to the West. In October, the group added Indonesia as one of its 13 new “partner countries.”
The move is a shift away from the position taken by Prabowo’s predecessor, Joko Widodo, who took in massive amounts of infrastructure investments from Beijing but remained mostly nonaligned geopolitically.
Prabowo’s visit comes during a transitional period at the White House, ahead of the incoming administration of President-elect Donald Trump in January. The White House has not formally announced the visit; however, Jakarta said Prabowo is scheduled to meet U.S. President Joe Biden at the White House early next week.
Indonesian diplomatic sources who spoke under condition of anonymity told VOA that Prabowo has requested a meeting with Trump. The Trump team has not responded to VOA’s query on whether it will be granted.
New period of US-Indonesia ties
Starting in January, both countries will be under the helm of leaders who were democratically elected but have employed authoritarian rhetoric, at a time when Washington is focused on its rivalry with the authoritarian regime in China under Xi Jinping.
Like Trump, Prabowo made a historical political comeback under unlikely circumstances. He secured a landslide victory after two failed attempts, 26 years after his father-in-law, President Suharto, was ousted from power. This, despite Prabowo admitting he was ordered by Suharto in 1998 to abduct activists protesting the regime.
Washington was aware of Prabowo’s involvement, and the Clinton, Bush and Obama administrations denied Prabowo entry to the U.S., citing human rights concerns. The Trump administration lifted the visa ban and then-Defense Secretary Mark Esper invited then-Defense Minister Prabowo to Washington in 2020.
With Trump in the White House, analysts say, Jakarta could see more opportunities to expand ties with Washington if Prabowo makes inroads through the right people for the right incentives, given Trump’s history of relying more on personal connections than institutional relationships.
Personal connections
Jakarta’s point person for Washington under the first Trump administration was Luhut Binsar Pandjaitan, a businessman and retired four-star army general who then served as coordinating minister for maritime affairs and investment.
Luhut developed close ties with Adam Boehler, head of the U.S. International Development Finance Corporation and a former college roommate of Trump’s son-in-law Jared Kushner. In 2020, Boehler dangled the promise of a $2 billion investment into Indonesia’s planned sovereign wealth fund.
The plan fell through because the price, recognition of Israel under the Trump administration’s Abraham Accords, was too high for Jakarta, according to an interview Boehler gave to Bloomberg at the end of 2020.
In Prabowo’s administration, Luhut holds the position of head of the National Economic Council and special adviser on investment affairs. But in a Cabinet of more than 100 officials, his influence has diminished.
“The deck is being shuffled right now, and we don’t know yet where the cards will land,” said Yeremia Lalisang, assistant professor of international relations at the University of Indonesia. What’s clear, Lalisang told VOA, is that the “pragmatic” Prabowo will be delighted to be welcomed by Trump after being treated as a “human rights criminal” by previous U.S. administrations.
One possibility to bolster ties under Trump would be for Prabowo to capitalize on the connection between billionaires among Trump’s inner circle. This would include Trump’s wealthiest backer, Elon Musk, and Hary Tanoesoedibjo, an Indonesian tycoon who has partnered with the Trump family on several real estate projects in Indonesia. Both were at Trump’s residence in Mar-a-Lago, Florida, Tuesday night, celebrating his election victory.
Tanoesoedibjo, who commonly goes by his initials H.T., would not confirm whether he is facilitating a Trump-Prabowo meeting next week. However, he said, Trump’s victory would bring “positive hope for Indonesia.”
“Trump’s favorable understanding of Indonesia should be maximalized for the economic benefit of both countries, especially Indonesia’s economic interests,” H.T. told VOA.
Investing in nickel
Under Jokowi’s administration, Jakarta courted Musk, head of SpaceX and Tesla, to invest in two key areas: satellites and electric vehicle batteries. Earlier this year, Musk launched SpaceX’s satellite internet service, Starlink, in Bali and Maluku.
With the Earth’s largest reserves of nickel, Indonesia is eager to develop its EV battery industry, and Prabowo is expected to continue his predecessor’s yearslong effort to lure Tesla to invest.
The Biden administration has put aside tens of billions of dollars in tax credits to spur the U.S. EV industry, under the Inflation Reduction Act, its signature climate and energy legislation. To qualify for the credit, 40% of the minerals used for battery production for EVs sold in the U.S. must be extracted or processed domestically or in one of its free-trade partners.
Jakarta has been pushing for a limited free-trade agreement that will allow it to benefit from IRA tax credits. However, its nickel industry is backed by investment from Chinese companies and besieged by environmental concerns, limiting its access to the U.S. market.
“You might see some of this calculus change during the course of the Trump administration,” said Andreyka Natalegawa, associate fellow for the Southeast Asia Program at the Center for Strategic and International Studies. Trump has vowed to loosen environmental restrictions.
U.S.-Indonesia cooperation on nickel is “out there as an objective,” said Ann Marie Murphy, senior research scholar at the Weatherhead East Asian Institute at Columbia University. “If it fails to come to fruition, I think that could be disappointing to both sides,” she told VOA.
However, Trump, who has made high tariffs on China a central theme of his campaign, will be looking closely at the tariffs’ impact on the EV industry. He has vowed to roll back tax credits available to EV buyers in the U.S.
He will also be watching bilateral trade deficits. In 2017, his administration placed Indonesia on a watchlist of countries that have a large trade surplus, threatening Jakarta with unspecified consequences if trade was not brought into balance.
“There’s lots of question marks here that we still need to wait and see to get answers,” Natalegawa told VOA.
Yuni Salim contributed to this report.
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