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Sunday, 24 March, 2002, 07:48 GMT
Megawati embarks on Asian tour
Indonesian President Megawati Sukarnoputri
This is Megawati's third lengthy overseas tour
Indonesian President Megawati Sukarnoputri has set off on a 13-day tour which will take her to East Asia and India.

The trip aims chiefly to improve economic ties and boost exports, which have suffered from falling demand in the US and Japan.

Indonesia - the world's fourth most populous nation - is struggling to recover from economic woes that began with the regional crisis in 1997.

But there will also be a diplomatic dimension when Megawati goes to North Korea, which US President George Bush recently branded as part of an "axis of evil".

South Korea would like her to encourage the authorities there to return to peace negotiations.

Business interests

Foreign trade and exports form the main focus of Megawati's third lengthy overseas tour since coming into power in 2001.

Megawati leaves Jakarta on her tour
The US sees Jakarta's cooperation as vital for the war on terrorism
Foreign ministry spokesman Marty Natalegawa said economic issues would dominate talks, especially with China, South Korea and to some extent India.

But analysts are pessimistic about the outcome.

Investors have so far shied away from a country still subject to political instability and separatist violence.

Critics say a national political consensus on solving these issues is needed before foreigners will place their confidence in the Indonesian economy.

"Jakarta's core problems such as political instability and a weak legal system, which have discouraged investment and trade, are at home not overseas," said Umar Juoro, an economist at the private Jakarta-based think tank CIDES.

War on terrorism

The US-led global war on terrorism is also likely to be a topic on the agenda during Megawati's trip, which takes her first to China.

The US military are aiding security forces in the Philippines in their campaign against al-Qaeda rebels, and also want to boost links with forces in Indonesia.

North Korean President Kim Jong-il
The North Korean leg of the tour will be closely watched by Seoul and Washington
Increased American intervention in the region is likely to be under discussion when Megawati visits communist North Korea.

She met its leader Kim Jong-il when the two were children - a time when the two countries, led by their respective fathers, were friends.

Foreign ministry spokesman Natalegawa said Megawati had agreed to a South Korea request to try to encourage the North back to the negotiation process with Seoul and Washington.

But this may prove a difficult task. Kim Jong-il is angry at Mr Bush's description of his country as part of an "axis of evil".

Analysts are sceptical that Megawati will make any significant breakthrough, given her progress on previous trips.

 WATCH/LISTEN
 ON THIS STORY
The BBC's Duncan Hewitt
"The length of the visit is seen as symbolic"
See also:

25 Feb 02 | Business
Indonesia plans to revive economy
26 Jul 01 | Business
Rebuilding Indonesia's economy
08 Mar 02 | Country profiles
Country profile: Indonesia
12 Feb 02 | Country profiles
Country profile: North Korea
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