Indonesia and Singapore Sign Important Defense, Airspace Management, and Extradition Treaties

• Indonesia and Singapore have signed three key treaties on defense, airspace management, and extradition.
• The treaties grant Indonesia control over the airspace over its Riau Islands province. The airspace had been administered by Singapore since 1946.
• Both countries signed an extradition agreement that covers a list of over 30 extraditable offenses, for crimes dating back 18 years.
• This allows the Indonesian authorities to extradite those who embezzled the billions of dollars from the government’s liquidity funding program during the Asian financial crisis in 1997.

On January 25, 2022, Indonesia and Singapore signed three landmark treaties covering defense, airspace boundaries management, and extradition, ending years of sometimes-heated public wrangling on these longstanding bilateral issues.

The Flight Information Region (FIR) agreement, Defense Cooperation Agreement (DCA) agreement, and an extradition treaty were signed at the 5^th Indonesia-Singapore Leader’s Retreat, on the Indonesian island of Bintan, heralding a new age for relations between the two countries.

An extradition and defense agreement was signed in 2007 by Indonesian President Susilo Bambang Yudhoyono and Singapore Prime Minister Lee Hsien Loong, but it was never ratified by the Indonesian Parliament. At the time, they cited security concerns over allowing the Singapore military to conduct training exercises on Indonesian soil. The consensus now reached by both sides showcases that diplomacy can still result in positive outcomes in an increasingly contentious region.

The treaties will still need to be ratified by the parliament of both countries.

Realignment of the flight information region

Under the FIR agreement, Indonesia and Singapore have agreed that Jakarta will now control the airspace above Indonesia’s Riau Islands province. The airspace has been administered by Singapore since 1946, under the order of the International Civil Aviation Organization (ICAO).

Singapore, which was then under British rule, was granted control of the airspace above the Riau Islands during the 1946 ICAO convention in Dublin, Ireland. Singapore was considered to have the necessary technology and manpower to administer the airspace whereas Indonesia, having declared independence from the Dutch a year earlier, was fighting a brutal war of independence against their former colonial masters.

The area serves as a corridor for flights in and out of Singapore’s Changi Airport and the country will continue to regulate flights through parts of Indonesia’s FIR for 25 years, which can be extended. The agreement thus ensures Changi’s status as an air hub in Asia remains guarded.

According to Indonesia’s Coordinating Ministry of Maritime and Investment Affairs, the country will delegate civil aviation services under its reclaimed FIR and send personnel to a Singapore air traffic control center. This will ensure that Indonesia’s sovereignty is maintained.

Extradition treaty

Under the extradition treaty, Indonesia and Singapore will grant extradition for a list of over 30 extraditable offenses, including money laundering, corruption, narcotics, bribery, and terrorism funding.

Singapore has long been accused of benefiting from the ill-gotten gains of Indonesian fugitives. On their part, Singaporean officials have rebutted each time and pointed out that the country has cooperated with Indonesia on a number of fraud and graft investigations. The country’s Finance Minister Sri Mulyani commented in 2016 that Indonesians had parked around US$200 billion worth of assets in Singapore or 80 percent of the US$250 billion of overseas assets stashed by wealthy Indonesians. To put this into perspective, Singapore’s GDP in 2016 was estimated at US$316 billion.

The latest extradition treaty allows for the extradition of crimes dating back 18 years, enabling Indonesian authorities to extradite those who embezzled the billions of dollars from the Indonesian government’s liquidity funding program during the Asian financial crisis in 1997.

Indonesia recently established a task force aimed at retrieving bailout funds given to borrowers and bank owners that were never repaid after the Asian financial crises. The country’s central bank bailed out over 48 debtors, amounting to US$10 billion with most being misused by the debtors. The task force has until 2023 to chase any overseas assets.

Further, the new treaty closes a legal loophole on the changes of citizenship that fugitives use to evade prosecution. Extradition requests can now be based on the citizenship status of the accused from at the time the offense occurred.

Defense cooperation agreement

The Defense Cooperation Agreement enables the Singapore Armed Forces (SAF) to conduct military training in Indonesia, with full respect to its sovereign territory.

Indonesia and Singapore signed a military training area agreement (MTA) in 1995, which would allow troops from space-starved Singapore to conduct military exercises in Indonesian waters, specifically near the Riau Islands province and the outer islands of the South China Sea. However, Indonesia re-evaluated the agreement in 2003, arguing that Singapore’s military exercises often exceeded the demarcation area and had invited other countries, such as Australia and US, into the area.

Indonesia and Singapore signed their first DCA in 2007 after the MTA ended in 2003, to once again allow the SAF to conduct military exercises in Indonesia. However, Indonesia’s House of Representatives still perceived Singapore to be a risk when they conducted military exercises in Indonesia’s archipelagic waters, and thus the DCA was never ratified.

What other agreements were signed?

The two leaders reviewed the ongoing bilateral relations between Indonesia and Singapore, looking at new areas of collaboration, such as human capital development, and sustainability.

MoU on financial and economic cooperation

The memorandum of understanding (MoU) on financial and economic cooperation covers traditional collaboration, such as on fiscal policies and customs cooperation, as well as emerging areas, such as climate finance and the digital economy.

Further, the central banks of both nations also signed an MoU to strengthen bilateral ties and promote collaboration on a range of payment innovations and regulatory functions. These include monetary policy, financial stability, regulatory frameworks, and countering anti-money laundering and the financing of terrorism.

MoU on energy cooperation

Indonesia’s Ministry of Energy and Mineral Resources and Singapore’s Ministry of Trade and Industry will seek to establish the Indonesia-Singapore Energy Workgroup. This will serve as a platform to facilitate electricity trading, the development of new technologies, such as carbon capture, and the financing of low-carbon energy infrastructure.

The human capital partnership agreement

Indonesia’s Ministry of Education, Culture, Research and Technology and Singapore’s Ministry of Education have signed a Human Capital Partnership Agreement (HCPA) to deepen educational cooperation between institutions and students.

Moreover, the HCPA will enable regular overseas exchanges and internships of students and educators.

Further Reading

• The Updated Indonesia-Singapore Tax Treaty Enters into Force
• Why Use Singapore as a Base for ASEAN Expansion
• Indonesia Passes Bill to Build New Capital City: Deadline 2024

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