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The Indonesian government disapproved of Trump’s recognition of Jerusalem as Israel’s capital. But Israel-Indonesian trade undermines the response.

By Oliver Ward

Days after President Trump’s announcement to recognise Jerusalem as the Israeli capital, Indonesia dispatched its Foreign Minister to garner political support for Palestine from other nations. Foreign Minister Retno Marsaudi stopped in Jordan, Turkey, and Belgium. She said, “we all have a moral responsibility to stop the injustices facing the Palestinian people.” Most ASEAN leaders are offering words of disapproval and dismay. The Indonesian response has been much more affirmative.

President Joko Widodo and Ms Retno will also both attend the emergency leaders’ summit of the Organisation of Islamic Cooperation (OIC) in Istanbul. The purpose of the summit is to organise a concerted response to President Trump’s decision from the 57 Muslim-majority nations in the OIC. Malaysian President Najib Razak will also attend.

Why is Indonesia so determined to assist Palestine?

Historically, Indonesia has maintained a very close diplomatic relationship with Palestine.

Sources: Reuters, PC, Revolvy, Middle East Eye, Jakarta Post (I), (II), ST

Indonesian President Joko Widodo has no choice but to fully endorse Palestinian independence. Indonesia has the largest Muslim population in the world. 1 in every 8 Muslims living in the island nation.

A 2014 poll showed that approximately 75% of Indonesians hold a negative view of Israel. If Widodo does not publicly campaign for the creation of an independent Palestinian state, he risks losing the support of the bulk of the electorate.

The political climate in Indonesia is also becoming more polarised. The far-right Islamic Defenders Front (FPI) has 200,000 members and is growing. Joko Widodo is under more pressure than ever to present a united front with the Palestinian people.

Indonesia has been conducting secret trade with Israel

In 2000, then Trade and Industry Minister Yusuf Kalla lifted the commercial restrictions on private sector trade with Israel. This is in direct contradiction to the wishes of the Arab League. The Arab League calls for a total economic boycott of Israeli companies.

In 2016, Indonesia exported US$103 million worth of products to Israel. It received US$110 million in imports. Trade has decreased since 2014 when bilateral trade between the two countries peaked at US$400-US$500 million.

Sources: OEC (I), (II)

In an attempt to keep trade relations under wraps, negotiations usually involve third parties. The Israeli embassy in Singapore facilitates bilateral trade negotiations between Indonesia and Israel, as does Indolink. Indolink is a trade broker based in Israel which deepens relations between Israeli and Indonesian businesses and investors.

There is Indonesian demand for Israeli technology

There is significant Indonesian-Israeli collaboration in the technology sector. A top Israeli venture capitalist described the Indonesian demand for Israeli technology, “Indonesia is a quickly growing country with a lot of needs in areas where Israeli tech has made important breakthroughs, like agricultural technology.”

There is significant demand for agritech in Indonesia. 45% of the Indonesian population works in the agricultural sector. It accounts for 16% of the nation’s gross domestic product (GDP). The Israel-Indonesia Chamber of Commerce website offers extensive background information on the Indonesian agricultural sector for prospective Israeli investors.

In late 2015, the Indonesian authorities initially included Israel in a list of 84 countries whose citizens could travel to Indonesia without a visa. The move aimed to boost the tourism industry in Indonesia. Israel was only removed from the list at the last minute after pressure from national Islamic groups.

The collaboration undermines the Palestinian cause

Such a close ally of the Palestinian nation conducting trade with Israel strikes a dent in the Palestinian cause. Bilateral trade with the nation with the largest Muslim population enhances Israel’s political objectives and helps to legitimise its expansion.

Israel has used its economic strength to further its political objectives before. In the 1950s, Israel secretly sold minerals to Romania at very competitive prices. There was an embargo on trading with Israel throughout the whole communist bloc. In return for the cheap minerals, the Romanian government allowed Jews to leave Romania and settle in Israel.

Establishing diplomatic relations with Indonesia would be a monumental victory for Israel. It would legitimise the territory and provide the perfect opportunity for Israeli expansion.

Joko Widodo must stop trading with Israel. Giving Israel the platform allows it to further its political objectives. Continued trade with Israel also undermines Widodo’s anti-Israel posture at home.