The Underwhelming Canada-Indonesia Relationship


(Prime Minister Justin Trudeau met today with Indonesian President Joko Widodo on the margins of the G20 Summit in Turkey – source: Prime Minister’s Office of Canada archive)

Prime Minister Justin Trudeau’s visit to China is an important foreign policy move, but there is one country in the Asia Pacific that Canada should not ignore.

The relationship between Canada and Indonesia traces back to 1948 when Canada became one of the first countries to recognize Indonesia’s independence. Shortly thereafter, the formal bilateral relationship between the two countries was established. Unfortunately, Canada has yet to be successful with capitalizing on the economic opportunities from the relationship. A 2016 report by the Centre for International Governance Cooperation (CIGC) found that there is a serious deficit in mutual awareness between Canadians and Indonesians. Indonesia is currently the largest country in Southeast Asia in terms of economy, population and geography. It is a diverse nation whereby 50% of its 250-million population is under the age of thirty. According to the McKinsey Global Institute (2012), Indonesia is poised to be the seventh largest economy by 2030. As Canada looks to boost its global footprint, it needs to seriously improve its bilateral relationship with Indonesia. A strong Canada-Indonesia relationship will make Canada a stronger player in the Asia Pacific.

Canada and Indonesia share an array of similarities that could serve as a foundation for a stronger, long-term bilateral relationship. First, the two countries have a democratic, multiparty political system. As a matter of fact, Indonesia is considered to be the only country in Southeast Asia with a Western-style democratic system. Second, the two countries are largely multicultural. There are currently more than 200 ethnic groups in Indonesia, speaking over 700 languages. Third, both countries are members of major international blocs such as the G20 and APEC.

There are four key areas where Canada can improve its bilateral relationship with Indonesia. First, Canada must enhance its diplomatic relationship with Indonesia by officially upgrading the relationship to a tier-one relationship by 2020. Canada needs to place Indonesia as Canada’s main strategic partner in Southeast Asia. Second, Canada needs to upgrade its security relationship with Indonesia by initiating high-level military cooperation. Third, Canada must reinvigorate its economic relationship with Indonesia. Trade between the two countries currently stands at a mere $3.5 billion while the two countries’ combined GDP is close to $3 trillion. Therefore, total trade can definitely be improved. Fourth, Canada must increase educational assistance to Indonesia. Canada’s excellent post-secondary education system is undoubtedly enticing to Indonesia’s large young population. By promoting Canada’s education system in Indonesia, and awarding more scholarships to Indonesian students, the two countries could have a stronger cultural, people-to-people relationship. This will also accrue to other areas such as enhanced economic cooperation, governance, and security.

Canada’s most recent initiative with regard to its relationship with Indonesia was its $14.25 injection to infrastructure development in Indonesia. However, there has yet to be a substantial effort from senior-level Canadian bureaucrats in demonstrating Canada’s commitment to Indonesia. To be fair, the Indonesian government has not been showing its commitment to Canada either. Canada could potentially be a strong North American ally for Indonesia considering the recent United States’ withdrawal from the global diplomacy under the Trump administration. The last time an Indonesian President officially visited Canada was back in 1956 when Sukarno visited Prime Minister Louis St. Laurent in Ottawa. This illustrates how distant the two countries are from the bilateral relationship standpoint. Although it takes ‘two to tango,’ as a developed country that is in more of a position for global outreach, it is time for Canada to take the first step in strengthening its bilateral relationship with this large yet unknown Southeast Asian nation.

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