Companion to East Timor - Howard's letter to Habibie

Howard's letter to Habibie

The economic situation in Indonesia was plunging to new depths. In the second quarter of 1998, real GDP was 16.5% below the same period in 1997. The exchange rate was more than four times lower than the previous year. Imported goods had become prohibitively expensive, inflation was sky-rocketing, the price of food was soaring and the purchasing power of the rupiah was plummeting. Wage-earners had lost more than a third of their real incomes. Domestic unrest was threatening to get out of control. To compound all this, oil prices – a key source of government revenues – were stagnating at $10-12 per barrel. In the midst of all this, international activism about East Timor was a problem that President Habibie simply did not need. By this stage, of course, twenty-four years of struggle inside the territory and solidarity work in the international arena had made East Timor something of a cause celebre. Solidarity groups existed in many parts of the world. The Nobel Peace Prize had further legitimised the cause of self-determination. Inside Indonesia, many civilians who had become more influential had no real desire to hold on to East Timor. Influential Muslim political figures had no real commitment to retaining the territory. Only the Indonesian military refused to let it go.

Australian policymakers who were committed to the status quo searched for ways to help the Indonesian military retain East Timor. The military's political and economic weaknesses were temporary; at some time in the future, it would once again be strong enough to crush East Timorese demands. Australian policymakers wanted to delay self-determination until such a time. Australian Prime Minister John Howard therefore wrote to President Habibie on 19 December 1998, suggesting that 'the East Timorese desire for an act of self-determination' could be addressed 'in a manner that avoids an early and final decision.' Howard approvingly cited the Matignon Accords, which 'enabled a compromise political solution to be implemented while deferring a referendum on the final status ... for many years.' Only weeks before, Australian foreign minister Alexander Downer had celebrated the 10th anniversary of the Matignon Accords, which had been signed between the Government of France and constituencies in New Caledonia. These Accords had effectively deferred a decision on New Caledonia's final status for more than a decade. Indonesia too could adopt the formula of 'a substantial period of autonomy' followed by 'an act of self-determination by the East Timorese at some future time.'

Howard's letter did not signify any support for East Timorese self-determination but the exact opposite – it was designed to defuse the issue and postpone self-determination indefinitely. The government's official submission to a parliamentary inquiry on East Timor confirmed that its 'declared preference remains for a long transition period before a decision is taken on East Timor's final status.' It reiterated months after the letter was sent that there had been no shift in policy:

On all the evidence available, the Prime Minister has come to the conclusion that if the objective is economic and strategic stability then an autonomous East Timor within Indonesia, at least for the time being, would be the better option.

The Deputy Secretary of Australia's Department of Foreign Affairs and Trade later explained that 'a very important part of our thinking at the time that the Prime Minister dispatched his letter was that Indonesia had only one last chance to keep East Timor as part of Indonesia.' The US acknowledged that the Australian government's policy had not changed. Its Assistant Secretary of State for East Asian and Pacific Affairs, Stanley Roth, observed that the Australian decision was 'far more nuanced than' support for self-determination:

It's a phased decision that says that after a considerable period of time in which there's been autonomy, which is not defined, I believe, that then, you know, there should be some act of self-determination in the meantime in respect to the territorial integrity of Indonesia.