Indonesian relations with the United States were generally warm and cordial after the establishment of Suharto's New Order government. In many respects, the United States during the Cold War was the least threatening superpower, assisting the economic recovery of the country both bilaterally and through the IGGI. In 1991 United States trade with Indonesia was greater than its trade with all of Eastern Europe. Despite its professed nonalignment, Indonesia also recognized the importance of the United States military and political presence in Southeast Asia in maintaining the regional balance of power. There were issues, however, which divided the two countries in the early 1990s. The United States rejected Indonesia's archipelagic claims to jurisdiction over the vital deepwater straits linking the Pacific and Indian oceans. During this period, the United States also vigorously opposed Indonesia's efforts to promote the NFZ through ASEAN. On the other hand, Indonesia, like other developing countries in the region, was troubled by what it saw as creeping protectionism in United States trade policy. This concern led to a bruising diplomatic contest over the issue of the protection of intellectual property. Ultimately, Jakarta bent to the implied threat of sanctions specified in United States trade law.

The human rights and East Timor issues continued to irritate political communication between Jakarta and Washington. Indonesia resented the attention given to this issue by the United States Congress, which in turn was roused to action by human rights advocacy groups. For Indonesia, the persistent allegations belied the sincerity of United States protestations about Indonesia's contributions to regional peace and security. Efforts to sanction Indonesia by cutting off military assistance or threatening its Generalized System of Preferences status were viewed in Jakarta as anti-Indonesian. The official United States government position, as stated in March 1992 by Deputy Assistant Secretary of State Kenneth M. Quinn, was that cutting ties, "would not produce the desired results which we all seek and could have negative consequences: for United States Indonesia relations; for our limited influence in Indonesia; and most importantly, for the people of East Timor." While the United States government wished to work cooperatively with the Indonesian government to promote development and respect for human rights in East Timor, it also had to be able to work productively with the Indonesian government on a broad range of issues because it was an important regional power and one with a growing extra-regional voice.

The United States Congress seemed more reluctant than the executive branch to separate the issue of broader interests with Indonesia from the problem of human rights. Congressional and NGO critics argued that United States policy rested on an out-of-date view of Indonesia's strategic importance now that the Cold War that had ended. Furthermore, these groups asserted that the United States should use its influence to push a democratic agenda. Later in 1992, United States legislation was discussed that would have terminated all of Washington's aid and trade concessions to Jakarta and required the United States to oppose World Bank loans to the country. In reality, only Indonesian participation in the International Military Education and Training (IMET) program was cut--a relatively insignificant sanction in terms of its functional impact on Indonesia's military, but one fraught with negative symbolic value as an expression of United States interests in the bilateral relationship.

In 1996 Indonesia will have ended the third decade of New Order government. By that time, more than halfway through the 1993-98 presidential term of office, the issue of presidential succession might be resolved. This could unblock the political logjam that in the early 1990s seemed to stall the process of domestic political change--keterbukaan--set in motion by the government's development policies. A May 1992 World Bank report stated that by the end of the decade Indonesia would be a middle-income country. This prediction seemed to be on target. Indonesia was beginning to play a middle-power role regionally and even globally in some interest areas. More and more Indonesians were likely to be socialized to the country's modern political culture, which increasingly resembled the newly industrialized economies. The trends seemed to indicate that the stability deemed so necessary for development will depend upon a government more responsive to diversified public interests than simply to those of the ABRI-bureaucracy-presidential palace elite.

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Source: U.S. Library of Congress