Indonesia Offered Financial Incentives to Normalize with Israel

Efforts to encourage additional countries to normalize ties with Israel are ongoing, and Indonesia, with the world’s largest Muslim-majority, is high on the list.

Adam Boehler, the CEO of the U.S. International Development Finance Corp., told Bloomberg that Indonesia could receive $1 billion to $2 billion more in development aid if it agrees to recognize Israel.

“We’re talking to them about it,” Boehler said. “If they’re ready, they’re ready, and if they are then we’ll be happy to even support more financially than what we do.”

Oman and Saudi Arabia have often been mentioned as candidates for normalization, but they wouldn’t qualify for funding from the DFC, because, as Boehler explained, its mandate does not allow it to invest directly in higher-income states.

Boehler spoke to Bloomberg in Yerushalayim, where he traveled together with Jared Kushner and Israeli National Security Adviser Meir Ben-Shabbat, who went on together to the Moroccan capital Rabat to finalize normalization agreements.

A U.S. congressional aide with ties to the Democratic leadership told the Jewish Telegraphic Agency that Jakarta should be wary of the proposal being made just weeks ahead of the Jan. 20 inauguration of President-elect Joe Biden.

“If I were the Indonesians, I wouldn’t bank on any promises the administration is making now,” said the aide, who spoke on condition of anonymity. “The Development Finance Corp. was designed as a development tool, not an incentive for political developments.”

The Palestinians are also doubtful. Earlier in the month, the Palestinians claimed that Indonesia promised them not to normalize relations with Israel until after a Palestinian state has been established.

The Palestinian Authority’s official news agency Wafa said that Indonesian President Joko Widodo have given assurances to PA President Mahmoud Abbas.

Despite the rapid changes in the Middle East, Indonesia will not take any steps to normalize with Israel until a permanent and comprehensive peace is achieved between the Palestinians and the Israelis,” Widodo told Abbas, according to a readout of their conversation.