GERMANY IN THE INDO-PACIFIC: MAINTAINING COOPERATION WITH INDONESIA

Jakarta, Sitz der ASEAN

Writer: Hendra Manurung (Doctoral candidate in international relations, Padjadjaran University, Bandung)

Asia is the most dynamic growth region worldwide and will continue to consolidate this position in the 21st century. At the same time, Asia is faced with problems of global significance. German foreign policy takes account of both dimensions. The geopolitical power shifting in the Indo-Pacific had a significant impact on Germany: the economies of the European and Indo-Pacific regions which are also closely linked to each other through global trade and shipping chains. Important trade routes pass through the Indian Ocean, South China Sea, and the Pacific Ocean. Suppose, if a conflict occurs that can affect regional security and stability, all of this will certainly also have an impact on Germany political economy interest. Until now, the Indo-Pacific has not had a clear definition of geographic area. Each actor has a different definition. However, Germany recognizes the Indo-Pacific region as the entire territory formed by the Indian and Pacific Oceans.

Germany emphatically supports the EU’s efforts to become an ASEAN strategic partner and also working towards a free trade agreement between the EU and ASEAN as a whole. While France and Italy as the EU member states have now joined Germany in becoming ASEAN development partners.

Germany aim is to strengthen relations with this important region and to expand the cooperation in the areas of multilateralism, climate change mitigation, human rights, rules-based free trade, connectivity, digital transformation and, in particular, security policy. More than half of the world’s population lives in countries formed by the Indian and Pacific Oceans. In the last few decades, countries such as Indonesia, Vietnam, China or India have experienced rapid economic growth. In the midst of a global pandemic, currently, the region is a contributor to 40% of the world’s gross domestic product. With this increase, it is expected, this region has an important role in the economy and politics. Simultaneously, strategic competition is increasing for influence in the region. The Indo-Pacific will become major trending to the development of new international order in the 21st century. Germany wants to expand closer cooperation with countries in the Indo-Pacific.

Currently, the Indo-Pacific region is still facing the challenge of tug of influence and interests between the superpowers and the socio-economic impact of COVID-19. The ASEAN Outlook on the Indo Pacific serves as a guideline for maintaining regional peace and stability. It is expected that Germany can continue to support ASEAN centrality and participate in building a safe, peaceful and prosperous Indo-Pacific region.

The Indo-Pacific region is a priority of German foreign policy. Thus, upon adoption of the guidelines on September 2, 2020 through the German Federal Cabinet of Foreign Ministers, Heiko Maas stated as follows:

‘Prosperity and geopolitical influence in the coming decades will depend on the cooperation Germany has with countries in the Indo-Pacific region. There more than all regions of the world will take place strategic decisions regarding the future arrangement of international regulations. Germany wants to participate in shaping this arrangement so that decisions that occur will be made on the basis of international regulations and cooperation and not on the rights of the great powers’.

 

Further, through this strategy, Germany will actively participate in the establishment of a new international order in the Indo-Pacific region. The Covid-19 pandemic and its effects have shown once again that the rest of the world stands in front of world challenges that can only be overcome if countries will cooperate with one another continuously. An important goal is to strengthen the structure of international cooperation, especially to tie close relations with ASEAN countries, where Berlin also wants to improve cooperation with them in the future, particularly with Jakarta.

In March 2019, the German parliament delegation met the Indonesian Ministry of Foreign Affairs to discuss developments in ASEAN and the Indo Pacific. Several issues that are of concern both bilaterally and regionally include issues related to the Sustainable Development Agenda (SDGs), palm oil, the development of smart cities cooperation, the Jakarta Declaration and projections of the future of ASEAN and the economies of its member countries in the next 10 years (2019-2029). Strengthening the regional architecture and the economic recovery of the Indo-Pacific region after COVID-19 is the main focus for increasing cooperation between Germany and Indonesia. Germany’s commitment as a partner to the Indo Pacific countries to face these challenges is manifested in sustainable practical cooperation in the political, economic and socio-cultural fields.  According to the Indonesian Ambassador to Germany, Havas Oegroseno, Indonesia has great potential to become a partner country in the dual-platform in 2021 and 2023. Although economic conditions have deteriorated in almost all countries including Indonesia, there are at least three interesting economic figures, including 1) Indonesia’s digital economy has generated by around 11% from the previous year. In 2019, Indonesia’s digital economy reached US$ 40 billion and in 2020 amounted to US$ 44 billion, 25% of this increase came from the health sector; 2) during a world economic recession, Indonesia export figure was higher than in the same month in 2013; 3) The increase in investment in Indonesia, especially for domestic investment. During the pandemic period, Indonesia received sixteen investment commitments primarily for diversion and diversification.

For Indonesia which adheres to a free and active foreign policy, this cooperation also emphasizes that Indonesia is very open to expanding cooperation and funding assistance for cooperation programs from various parties, including with Germany. The development of bilateral cooperation with Germany needs to be a priority. The Indonesian government is also ready to offer land to become the centre for German industrial estates, in addition to having prepared around 100 hectares of land. Several other attractive incentives have been prepared by Jakarta, particularly for the development of the German automation and digital innovation sector in Indonesia sooner or later.

For Germany, even in a pandemic like today, industrial technology still remains the central platform for innovation and industrial transformation solutions. However, due to the COVID 19 pandemic, it was decided to postpone the Hannover Messe 2020 exhibition to 2021. The biggest industry exhibition is planned to be held on 12 to 16 April 2021. Indonesia as a partner country for this exhibition is privileged. This is because Deutsche Messe AG (DMAG) as the organizer of the exhibition gave Indonesia the opportunity to become a partner country twice, in 2021 for exhibition on digital platforms, and in 2023 on live platforms. This makes Indonesia the longest partner country in the history of the Hannover Messe.

Indonesia and Germany as fellow members of the G-20 have implemented a form of joint responsibility towards current global important issues, especially related to climate change. This initiative is also a form of synchronization between the challenges of developing urban areas and a commitment to address environmental problems. On March 4, 2021, Indonesia’s determination to carry out green reform in the field of urban infrastructure development has received support from the German Government. Indonesia and Germany agreed to collaborate on “Indonesia – Germany Initiative for Green Infrastructure”. This cooperation is directed at urban area transformation and innovation projects that aim to reduce carbon emission levels in Indonesia. Through this cooperation, Germany will provide funding support of € 2.5 billion, or approximately the equivalent of Rp 41.25 trillion. This funding will be provided in stages over five years in partnership from 2021 to 2026 with the KfW bank, which is the German National Bank for development funding, as well as with GIZ. Four provinces were selected for the implementation of this initiative, namely: West Java, Central Java, East Java and Bali. Each province has a flagship project which is certain to be funded by this initiative. These projects lead to Indonesia’s sustainable green economy and infrastructure.

During the last ten years since 2010, the Indo-Pacific region has gained a more important role both economically and politically. Berlin is currently setting its political economy future with the Indo-Pacific countries. One of the biggest global challenges, but also in the Indo-Pacific region includes fighting against climate change and fighting marine pollution. Germany wants to work together with Indo-Pacific countries to find better solutions to the problem.

There are many areas in which Germany would like to cooperate more closely with the countries of the region, both in the area of strengthening state law and human rights and in the areas of cultural, educational and scientific exchanges. The political security sector, of course, also has a special position and attention for Berlin.

Economic relations must also be developed among other things, through the completion of the European Union free trade agreements with other Indo-Pacific countries. Additionally, through the diversification of cooperative relationships, dependence on one party can be avoided. Further themes such as digitization, networking or technology usages with a vision for the future are of critical importance to Germany’s ability to compete globally. Public communication on free access to information and protection against fake news is also included.

The policy guidelines for the Indo-Pacific region adopted in 2020 by the German government are needed at this time to maintain the country’s geo-economic conditions in the region. With these guidelines, Germany wants to facilitate a European strategy towards the Indo-Pacific. Therefore, the European political approach strategy emphasizes and prioritizes strategic factors connected to closer cooperation, including with the EU region.

In January 2019, China questioned the Indo Pacific concept that Indonesia was proposing to adopt by ASEAN. China does not reject the Indo-Pacific concept that emphasizes principles of openness, inclusiveness, transparency, respect for international law, and the centrality of ASEAN, but also not comfortable with the concept. The Indo-Pacific concept was first popularized by the United States to compete with China’s influence, which is aggressively running trillions of US dollars’ worth of infrastructure projects through the Chinese Belt and Road Initiative. After the US, several countries including Indonesia are trying to develop their respective concepts regarding the Indo-Pacific, to ensure peace, stability and prosperity in Southeast Asia amid the tug-of-war of the constellation of world major powers.

For Germany and Indonesia and other countries in the Indo Pacific, the main challenge for developing the Indo-Pacific concept at this time is to form the foundation of the current concept of an inclusive region. The ASEAN Indo-Pacific concept must not embed the concepts of other countries or blocs. Equality should be part of the AOIP concept because of the principles held in the region. Indonesia treats every country equally.

Germany is one of just a few countries in the world that has combined its numerous measures, both existing and planned, in the Indo-Pacific region to create a coherent political framework. It is important to emphasize that these are guidelines for the entire Federal Government, underlining its common desire to engage to an even greater extent as an influential actor and partner in the Indo-Pacific region and to help maintain the rule-based order in place.

Gemeinsam mit Deutschland und Indonesien das wirtschaftswachstum sowie rrieden und stabilität und sicherheit in der Indopazifischen region fördern.

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