Australia and Timor-Leste are in a diplomatic lull following the revelations that Australia spied on Timor-Leste's cabinet via agents working through its aid program. Prime Minister Xanana Gusmao is in South Africa for the funeral of Nelson Mandela, who had visited him in prison in Jakarta and thus helped elevate his international status.
But one senior minister, left to mind the shop, chuckled quietly. By spying on Timor-Leste, he believes that Australia has provided the mechanism required to invalidate the unequal Timor Sea treaty between the two countries.
There is official insistence that Australia and Timor-Leste remain close friends, despite the occasional angry comment. This particular dispute, the Timor-Leste government believes, should remain quarantined from the wider relationship.
Australia's official perspective is similar, with ambassador Miles Armitage taking a soft line towards recent demonstrations outside the Australian embassy. He was dismayed by riot police over-reacting and firing tear gas at a small group of protesters, also gassing ordinary police who had the situation well under control.
But it is not as though spying in Timor-Leste is much of a secret. One minister privately joked that the Chinese-built foreign affairs building is full of listening devices. And then there is the Chinese-built presidential palace and defence forces headquarters.
Australia is far from alone in its close interest in the Timor-Leste government. It is also far from alone in keeping tabs on the other representative offices here. Embassy row, along the seafront west of the town centre, boasts compounds that would look impressive in much larger capitals.
The substantial presence of China, the United States, Australia, Indonesia, Japan, Russia, Portugal and the other Lusophone states -- Malaysia, Thailand, Singapore, New Zealand -- reflects Timor-Leste's strategically important location astride oil and gas fields, a critical submarine deep sea route between the Indian and Pacific Oceans and being in the middle of the world’s largest archipelago.
It also reflects the simple fact that, with everyone here and paying attention, everyone else also feels they need to be here and paying attention to everyone else. Timor-Leste itself demurs on this question, claiming that it does not have the capacity to spy.
Yet in its 24-year struggle for independence, the Timor-Leste guerrilla army's intelligence network surpassed even that of the notoriously extensive intelligence network of the Indonesian military. The old networks, like the old clandestine names -- of which Prime Minister Xanana, President Taur Matan Ruak and past parliamentary speaker Fernando Lasama are but a few -- remain intact.
Information -- about everything and everyone -- always has been and remains the richest of prizes in Timor-Leste. To the extent that intelligence gathering activities have changed since Indonesian times, it is only their much greater scope that is different.
It may be that the letter sent by Prime Minister Tony Abbott to Indonesia’s President Susilo Bambang Yudhoyono will start to calm diplomatic tensions between the two countries. Given political sensitivities in Jakarta, it also may be that tensions will continue in any case, particularly if the letter is deemed inadequate.
But what is becoming increasingly clear is that Australia's close relationship to Indonesia, developed especially since Yudhoyono has been in office and at its strongest just a couple of months ago, may remain in reverse for a lot longer to come. This is likely to be the case even if the immediate diplomatic row is resolved.
There are three key drivers to the dispute, at least one of which will continue to affect the relationship regardless of the impact of Abbott's letter. The first driver of the dispute is that Yudhoyono is both angry and dismayed that he, his wife and senior officials had been directly spied on. As a former army general, he was well aware of the vulnerability of mobile phones to intercepts, and he is unlikely to have conveyed particularly sensitive information using it.
But Yudhoyono has gone out of his way to befriend Australia, often to domestic criticism, and now feels personally betrayed. To fix this, a letter and perhaps even a phone call to Yudhoyono are now probably too little, too late. According to senior Indonesian political academic Professor Bahtiar Effendy, Abbott needs to get on a plane and talk this through face-to-face. He will probably also need to propose an intelligence code of conduct.
This then raises the second driver; Abbott's diplomatic skills. His comments in Parliament were seen to diminish the importance of the matter and thus entrenched a pre-existing antipathy from Yudhoyono. Abbott had already alienated Indonesia’s political leadership while in opposition, with his "turn back the boats" policy playing very poorly in Jakarta.
This was made worse during his September visit to Bali, when he showed up late for two functions and excluded the Indonesia media from a press conference. Yudhoyono was said to have made sure he did not sit next to Abbott at the APEC summit dinner.
Indonesia's media, insulted by their exclusion, now regard Abbott as fair game.
Moreover, Abbott's front-footed political style goes down poorly in Indonesia, where it is regarded as coarse. This "coarse" perception was made worse by government pollster Mark Textor tweeting "that bloke who looks like a 1970s Filipino porn star", understood as referring to Indonesian Foreign Minister Marty Natalegawa.
The third and now most important driver in the bilateral relationship is that Yudhoyono and his Democratic Party have been tracking poorly in polls and he is seen as a weak leader. Although he cannot stand for re-election in the presidential elections next year, he wants to anoint a successor. To do so, he needs to be seen to be strong. Standing up to Australia is, now, not just an easy option but a necessary one.
It's also necessary for the rest of the field of likely candidates in the elections. None are as well-disposed towards Australia as Yudhoyono has been and all have jumped on the nationalist, anti-Australia band-wagon.
Regardless of Abbott's letter to Yudhoyono, the negative perception of Australia will now not come off Indonesia's nationalist agenda. The bilateral relationship over the next 10 months ahead of Indonesia's elections will be, at best, cool.
Depending on the outcome of those elections, Australia's relationship with the growing regional economic and strategic power could turn even colder.
Australia’s diplomatic relationship with Indonesia has gone from bad to worse following the latest damaging revelations about Australian spying on senior Indonesian political figures, including President Yudhoyono and his wife Ibu Ani. Indonesia is now expected to act on the matter, expelling Australian diplomats and suspending joint information gathering programs.
The most troubling aspect of this issue is the Australian government’s failure, so far, to attempt to neutralise the damage that is being caused to the relationship. This is despite Prime Minister Tony Abbott, describing Australia’s relationship with Indonesia as “all in all, our most important”.
Yet despite this affair now running over two weeks, there has been no action taken to settle it. Had the Australian government acted when the first spying claims were made, this latest issue of top level spying would have already largely been addressed.
However, Mr Abbott’s comments that all countries gather intelligence, though accurate, will be viewed as dismissive in Indonesia and adding insult to injury. This is at a time when Mr Abbott needs to apologise, in public, to the Indonesian leadership, and not as an unconcerned leader to the Australian public.
The revelation that Australia Defence Signals Directorate has tapped the phone of President Yudhoyono and his wife Ibu Ani is particularly embarrassing to Indonesia, given that President Yudhoyono has invested a great deal of political capital in the relationship. There have long been many politicians in Indonesia who have viewed Australia with a much more jaundiced eye than Yudhoyono. They will now be feeling vindicated, and Yudhoyono will have lost face.
With the Australian spying issue being played out in Indonesia against the backdrop of next year’s elections, Australia has further made itself an easy target for political point scoring. A strong and defensive sense of national pride has long characterised political debate within Indonesia, with Australia regularly singled out as a country with a history of offending that sensibility.
But even moderate political actors in Indonesia will feel compelled to take a strong stand against Australia. Not to do so will be seen domestically as having abandoned Indonesia’s sense of sovereignty.
In the short term, the expulsion of some diplomatic staff and the suspension of bilateral programs will cause problems, especially to Australia’s asylum seeker program. But the longer term fall-out could be at least as damaging.
Because Australia has not yet moved to assuage Indonesian concerns, Australian spying can be expected to resurface each time the issue of the bilateral relationship is raised in Indonesia. Each time a proposal is put forward about closer diplomatic, intelligence or strategic ties, the spying issue will be inserted as a consideration.
Australia will not, and probably cannot, substantially reduce its intelligence gathering activities in Indonesia. But it remains possible to at least give a public rhetorical semblance to a review of such activities. This would go a long way towards calming the growing anger that is being expressed in Jakarta.
Australia’s previously troubled relationship with Indonesia has, in recent years, been described as the best that it has ever been. It has been widely viewed as critical to secure the strength of that relationship as Indonesia heads into a new, post-election political environment. That intention, however, now appears to have been dashed.
At best, Australia can look to salvage what is left of the relationship. To do that, however, it must start taking public diplomatic steps in that direction.