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Interview

Indonesia's business lobby urges G-20 to 'put aside differences'

Trade leader warns of social unrest as Ukraine war triggers inflation spike

Arsjad Rasjid, chair of the Indonesian Chamber of Commerce and Industry, calls for G-20 unity during a recent online interview with Nikkei Asia. (Photo courtesy of Indonesian Chamber of Commerce and Industry)

JAKARTA -- Indonesia's largest business lobby is urging unity among leading rich and developing nations to overcome global economic issues, warning of a need to stave off social unrest as the Russia-Ukraine war fuels food and energy crises across the world.

"The G-20 Summit in November ... is more important than ever. Let's put aside the differences [and] unite in how to find ways to collaborate in order to face these economic challenges globally," Arsjad Rasjid, chair of the Indonesian Chamber of Commerce and Industry, or Kadin Indonesia, told Nikkei Asia in a recent interview.

"This Ukraine and Russia situation may also lead to social unrest in many countries that would create economic disasters," he added, citing disruptions in the global supply chain that have sent fuel and food prices to alarming levels since Russia launched its invasion of Ukraine late February. "Politics is one thing... [but] it is important to think about the people."

Rasjid was speaking on the phone from Washington, where he was joining the Indonesian delegation at a summit of the U.S. and the Association of Southeast Asia Nations hosted by U.S. President Joe Biden. Indonesia holds the G-20 presidency this year.

As chair also of the advisory board of Business 20, which represents business communities within the G-20 member states, Rasjid recently met with business leaders in New York and Canada, and will fly to Europe and Asia next.

The "roadshow," he said, is intended to urge business communities to persuade their country leaders to commit to G-20 meetings "because this is where the conversation should be. This is where we can actually sit together to find solutions."

U.S. President Joe Biden, center, poses with Southeast Asian leaders during a special U.S.-ASEAN summit at the White House on May 12.   © Reuters

Rasjid's call for unity comes at a time of some tension between G-20 nations over Russia's invasion of Ukraine. The U.S. and its allies have hinted at boycotting some meetings to protest Russia's participation. Despite the pressure, Indonesian President Joko "Jokowi" Widodo said in late April that he invited both Russian President Vladimir Putin, and Ukrainian President Volodymyr Zelenskyy, to the G-20 Summit in Bali in November.

Senior officials from Western countries walked out of an April gathering of G-20 finance ministers and central bank governors in Washington when the Russian delegation began to speak.

Widodo told Nikkei Asia in an interview in March that the G-20 is the "premier [gathering for] economic cooperation" and not a political venue. Still refraining from condemning Russia directly, Widodo during the U.S.-ASEAN Summit on Friday called for an immediate end to the war.

"When the world should be recovering immediately from the COVID-19 pandemic, it is facing the problem of the war in Ukraine," Widodo said. "When the world needs cooperation and collaboration, rivalry and confrontations are getting fierce instead. When the world needs multilateralism, it is unilateralism that's getting sturdy."

The summit in Washington is seen as a U.S. move to solidify its presence in Southeast Asia to counter China's influence, particularly after Washington's pivot away from the region under former President Donald Trump.

But the White House's $150 million pledge last week to improve infrastructure, security and pandemic preparedness across ASEAN has fallen far short of the many billions of dollars China had poured into the region in recent years.

Despite the small sum, Rasjid sees the U.S. pledge as "a positive signal, a first step" toward deepening trade relations with ASEAN, after which Washington is expected to take "more steps and more actions" in economic cooperation if it wants to restore the balance of power in the region.

Biden and the ASEAN leaders also committed to the establishment of an ASEAN-U.S. Comprehensive Strategic Partnership during the summit, to be finalized in November, similar to what the bloc agreed on with China last year.

"When we talk about the U.S. and China, [what] ASEAN and particularly Indonesia see is that the U.S. is sometimes only interested in discussing security issues," Rasjid said. "But all the security issues, the bottom line is the economy. So U.S. trade [and] investment [will be] the key factors" for stronger U.S.-ASEAN ties.

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