Singapore and Indonesia took significant steps forward in deepening relations during Prime Minister Lee Hsien Loong's first Leaders' Retreat with President Joko Widodo on Monday, with both leaders agreeing to wide-ranging initiatives aimed at enhancing economic ties.
For Indonesia, bilateral cooperation in areas such as tourism, energy and the digital economy, and new investments beyond Jakarta and Batam-Bintan-Karimun, represents opportunities to create more jobs, as well as promote growth and infrastructure development - key priorities for President Joko. It also means Singapore has delivered on a promise it made at the last retreat in 2013, to boost economic ties.
Observers may note the lack of progress in resolving issues such as the management of airspace over Riau, or the Extradition Treaty and Defence Cooperation Agreement. But many analysts, like Dr Yongwook Ryu, a research fellow at the Australian National University, see these as minor challenges as both countries have shown a willingness to address them through bilateral cooperation.
PM Lee also said after the retreat that there was an overall desire on both sides to take ties forward.
Indeed, there were strong signs to support that view. For starters, Mr Joko did not reschedule the retreat like he did his state visit to Australia last week, to deal with a divisive protest in Jakarta against its governor, who is a close political ally.
Also, in a rare compliment to Singapore by an Indonesian leader, he acknowledged that the city-state was his country's top foreign investor, and one which had raised its investments despite a global downturn.
It is too early to tell how far these will go towards strengthening ties, but the resumption of the pertemuan empat mata or "four-eye meetings" - which helped stabilise ties during the Suharto-Lee Kuan Yew era - are a solid start to improving relations between Singapore and Mr Joko's administration.
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