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EPF403 06/18/98 TEXT: ALBRIGHT 6/17 SPEECH TO THE ASIA SOCIETY (President's China visit will focus on past, future) (4560)

[Indonesia excerpts only] ... New York, New York -- ... The Secretary also reaffirmed U.S. support for reform in Indonesia. The United States is supporting proposals for loans to Indonesia from the World Bank and Asian Development Bank. It will be pledging $65 million in food and medical supplies for Indonesia in addition to its ongoing assistance programs, she said.

... US DEPARTMENT OF STATE Office of the Spokesman (New York, New York)

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SPEECH OF SECRETARY OF STATE MADELEINE K. ALBRIGHT 1998 ASIA SOCIETY DINNER WALDORF ASTORIA HOTEL

June 17, 1998

...

But as I said, I'm not going to talk about China tonight. Nor do I plan to talk, as I often have in recent weeks, about South Asia, although this Society has been very active in promoting better ties to, and within, that vital region.

Instead, I want to take advantage of the Asia Society's emphasis on diversity, and focus on three countries that illustrate that diversity quite dramatically --~ the Republic of Korea, Indonesia, and the Islamic Republic of Iran.

... One of the lessons of the past year is a lesson Kim Dae Jung has been teaching for decades: democracies are better able to adjust to change than regimes that are autocratic.

A true democracy has flexibility built into its system. The public has outlets for expressing anxiety, frustration and new ideas. Leaders can point to a popular mandate to carry out difficult policies. In times of stress, a democratic people is more likely to pull together than to fall apart.

There could be no better illustration of all this than the past year of living precariously in Indonesia.

Here, the financial crisis led to massive demonstrations, ugly ethnic-related violence, the martyrdom of at least four students and a sudden end to the rule of President Soeharto.

The new President, B.J. Habibie, has moved to address popular concerns by promising new elections and releasing political prisoners.

He has also assembled a strong economic team to grapple with a crisis aggravated by debt, looting, business flight, currency depreciation, rising unemployment and inflation. Over the long term, Indonesia clearly has the resources and the skills to bounce back. But today, the average citizen is hurting.

If Indonesia is to recover, its new leaders must reach beyond the traditional centers of power to build a consensus for peaceful, but profound, political reform based on democratic principles.

It is too early to judge whether the new government will pursue and succeed on such a course. But it is not too early to reaffirm America's commitment to do all we can to help the Indonesian people. This is the right thing to do. It is also the smart thing, because prospects for a stable transition to democracy will increase if humanitarian needs are addressed.

Accordingly, I am pleased to report that we have restored to Embassy Jakarta and throughout Indonesia the full complement of our diplomatic, USAID and other personnel.

Second, we will support proposals for new World Bank and Asian Development Bank lending to Indonesia.

Third, we are waiting for the report of the IMF team that is now in Jakarta to review its program there and discuss necessary adjustments, including those to address humanitarian concerns. We hope that an agreement can be reached soon that will release the next tranche of funds.

Finally, we will be pledging $65 million in food and medical supplies for Indonesia, in addition to our ongoing assistance programs.

The US has long been the world's leading outside supporter of human rights, legal aid and environmental organizations in Indonesia. Today, those groups are playing an indispensable role in helping their country build a true and la~sting democracy.

We are considering how best to use our support in the months ahead in areas such as civic education, development of a free press, the promotion of ethnic tolerance and technical assistance for elections.

President Habibie has also taken steps to begin to address the longstanding problem of East Timor. The United States would strongly support efforts by the new government to build a real consensus on East Timor through additional confidence building measures, a reduced military presence, and a genuine dialogue with its people.

Indonesia is a country of critical strategic importance. If it is able to recover and move ahead with freer institutions and a more open economy, it will reclaim its position as an anchor of stability and prosperity throughout its region. It will also fulfill, at long last, the deepest aspirations of its people.

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