[Weekly Compilation of Presidential Documents Volume 37, Number 38 (Monday, September 24, 2001)]
[Pages 1340-1342]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Joint Statement Between the United States of America and the Republic of 
Indonesia

September 19, 2001

    As leaders of the world's second and third largest democracies, 
President George W. Bush and President Megawati Soekarnoputri today 
vowed to open a new era of bilateral cooperation based on shared 
democratic values and a common interest in promoting regional stability 
and prosperity. They agreed that a strong bilateral partnership between 
the two countries will benefit both nations, the region, and the 
international community. President Bush and President Megawati 
emphasized the importance of a strong and prosperous ASEAN and pledged 
to cooperate to promote those objectives.
    President Megawati condemned the barbaric and indiscriminate acts 
carried out against innocent civilians and pledged to cooperate with the 
international community in combatting terrorism. She underscored that 
terrorism also increasingly threatens Indonesia's democracy and national 
security. The two Presidents agreed that their respective officials 
would soon discuss concrete ways to strengthen bilateral cooperation on 
counter-terrorism, in particular on capacity and institution building. 
They further affirmed their intention to expand cooperation to combat 
other transnational crimes, including piracy, organized crime, 
trafficking in persons, narcotics, and smuggling of small arms.
    President Bush expressed his conviction that Indonesia's transition 
to democracy is one of the most significant developments of this era. 
Noting the great importance the United States attaches to Indonesia's 
success, he pledged his support for President Megawati's efforts to 
build a stable, united, democratic and prosperous Indonesia. In that 
context, President Bush pledged to work with Congress to secure the 
Administration's request for at least $130 million in bilateral 
assistance for Indonesia in fiscal year 2002, with a special focus on 
assisting Indonesia's efforts with legal and judicial reform. 
Recognizing the priority President Megawati places on rebuilding 
communities in conflict zones, President Bush pledged an additional $10 
million to assist internally displaced persons, with a focus on the 
Moluccas. He further pledged $5 million for Aceh, to support 
reconciliation, help rebuild schools and other infrastructure destroyed 
in the ongoing violence, and assist with economic development projects, 
including environmental improvements and transportation. To strengthen 
Indonesia's law enforcement capability, President Bush also committed, 
subject to Congressional approval, to provide $10 million in police 
training.
    The two Presidents discussed the situation in the provinces of Aceh 
and Irian Jaya and agreed on the urgent need for peaceful resolution of 
separatist pressures. President Megawati affirmed her determination to 
pursue a multidimensional approach to these regions, including 
implementation of special autonomy, resource sharing, respect for 
cultural identity and human rights, restoration of peace, order and the 
rule of law, and continued efforts at dialogue and reconciliation. 
President Bush reiterated the firm support of the United States for 
Indonesia's territorial integrity and emphasized that the U.S. does not 
support secessionist aspirations in these areas or elsewhere.
    President Bush and President Megawati agreed to work together to 
support a stable and prosperous independent East Timor. The Presidents 
further agreed on the urgent need to find a comprehensive solution to 
the remaining problems of East Timorese in West Timor, East Nusa 
Tenggara province, notwithstanding the significant assistance already 
provided by the United States to alleviate Indonesia's burden. 
Recognizing that the plight of internally displaced persons (IDPs) still 
in West Timor is both an Indonesian and an international problem, the 
two leaders agreed to cooperate in developing a comprehensive plan that 
supports and implements the choice of remaining IDPs to resettle or 
return to East Timor. In their discussions, President Bush committed to 
provide both technical assistance and seed money in

[[Page 1341]]

the amount of $2 million dollars to help Indonesia develop and implement 
a credible plan, and to assist with the resettlement of those who choose 
to stay in Indonesia. The United States and Indonesia further pledged to 
work together to seek additional international support, upon completion 
of the plan.
    The two Presidents agreed that economic reform and restructuring are 
pressing challenges now facing Indonesia. President Bush expressed 
strong support for President Megawati's commitment to press ahead with 
structural economic reforms, including privatization of banks and the 
disposal of assets within the Indonesian Bank Restructuring Agency. 
President Megawati underscored her determination to improve Indonesia's 
investment climate, in particular by strengthening the rule of law, 
resolving outstanding investment disputes, and protecting investors' 
assets and property.
    As an expression of confidence in both President Megawati's 
leadership and the enormous potential of the Indonesian economy, 
President Bush announced that the three U.S. trade finance agencies--the 
Export Import Bank (ExIm), the Overseas Private Investment Corporation 
(OPIC), and the U.S. Trade and Development Agency (TDA)--have developed 
a joint trade and finance initiative to help promote economic 
development in Indonesia. The three agencies will undertake to provide 
up to a combined $400 million to promote trade and investment within 
Indonesia, especially in the Indonesian oil and gas sector.
    The two Presidents resolved to work closely to expand trade 
bilaterally, regionally and globally. President Bush agreed to provide 
Indonesia $100 million in additional benefits under the Generalized 
System of Preferences (GSP). To explore prospects for the further 
expansion of trade and commercial ties, the two Presidents directed 
their Trade Ministers to re-establish and convene the U.S.-Indonesia 
Trade and Investment Council at a mutually convenient date, based on the 
preparatory work already undertaken by senior officials in Jakarta on 
September 10. Both leaders noted the importance of open markets and 
expanded trade for economic growth and agreed on the importance of 
launching a new round of WTO negotiations at Doha, taking into account 
the need for a balanced agenda that reflects the interests of all WTO 
members.
    President Bush recognized the important role of the Indonesian 
military (TNI) as a national institution and both leaders observed the 
importance of military reforms in Indonesia's democratic transition. In 
that regard, the two Presidents agreed to expand modest contacts and 
resume regular meetings between their militaries to support Indonesia's 
efforts at military reform and professionalization. Upcoming activities 
will include Indonesian participation in a variety of conferences, 
multilateral exercises, subject matter exchanges on issues such as 
military reform, military law, investigations, budgeting and budget 
transparency, as well as humanitarian assistance and joint relief 
operations.
    President Bush and President Megawati agreed that military-to-
military relations, while important, should constitute only one aspect 
of the bilateral security relationship and that the two countries should 
cooperate to increase civilian participation in Indonesian defense and 
security issues. To promote this objective, the two leaders agreed to 
establish a bilateral Security Dialogue under the supervision of their 
respective civilian ministers of defense, which would provide an 
opportunity for an exchange of views on a broad range of security and 
defense issues. To further support President Megawati's efforts to 
foster proper civil-military relations in Indonesia's new democratic 
setting, President Bush also expressed his commitment to work with 
Congress to allocate $400,000 to educate Indonesian civilians on defense 
matters through the Expanded International Military Education and 
Training.
    President Megawati expressed her full appreciation that Indonesia 
must resolve outstanding issues relating to past human rights 
violations, especially in conflict zones. She asserted that as a state 
based on the rule of law, respect for human rights, and freedom of 
religion, Indonesia recognizes the importance of accountability for 
human rights abuses. In that context, and in the spirit of their shared 
commitment to promote reform

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and professionalization of the military in a democratic Indonesia, 
President Bush announced that the United States would lift its embargo 
on commercial sales of non-lethal defense articles for Indonesia, with 
individual applications to be reviewed on a case by case basis, as is 
standard practice in the United States.
    The two Presidents noted that both the United States and Indonesia 
were founded on the belief that a nation's diversity is a source of 
strength, not weakness--a concept embodied in their respective national 
mottos. They pledged to build on this shared belief as a basis for 
strengthening the bonds between their two peoples and for forging a new 
era of cooperation to advance their common interests.

Note: An original was not available for verification of the content of 
this joint statement.