Clinton comes to Indonesia on symbolic visit

JAKARTA (Reuters) - U.S. Secretary of State Hillary Clinton welcomed on Wednesday Indonesia's transition to democracy and stressed Washington's desire for stronger ties with Southeast Asia to bring change in Myanmar.

Clinton's visit to the world's most populous Muslim country highlights President Barack Obama's desire to forge a better U.S. relationship with the Muslim world, where many of the policies of former president George W. Bush's administration, including the 2003 U.S.-led invasion of Iraq, were deeply unpopular.

After talks with Indonesia's foreign minister, Clinton said the two nations intended to move forward in areas ranging from climate change to security and counter-terrorism.

"It is exactly the kind of comprehensive partnership that we believe will drive both democracy and development," Clinton told a joint news conference, adding it was "no accident" Indonesia had been picked for her trip.

Foreign Minister Hassan Wirajuda said Indonesia provided a successful development model.

"Indonesia is not only (the) country with (the) largest Muslim population but, as we have proven here, democracy, Islam and modernity can go hand in hand," the minister said.

"President Obama has a very strong constituency here in Indonesia -- of course, without the right to vote," said Wirajuda, when asked about a possible Obama visit to Indonesia, where he spent four years as child.

REVIEWING MYANMAR POLICY

Wirajuda said Indonesia had shared America's "joy" at Obama's election and he wanted Clinton to go back and tell the U.S. President "we cannot wait too long."

Clinton touched on a fresh U.S. review into its policy towards Myanmar to seek ways to sway the military junta.

"Clearly the path we have taken in imposing sanctions hasn't influenced the Burmese junta but ... reaching out and trying to engage them hasn't influence them either," she said.

Clinton was also due to visit the Jakarta-based headquarters of the 10-member Association of Southeast Asian Nations (ASEAN).

There had been concern in Southeast Asia that Washington neglected the region under Bush and allowing China to fill the vacuum.

Clinton was expected to discuss signing ASEAN's Treaty of Amity and Cooperation when she visited the group's headquarters.

Signing the treaty with ASEAN, a grouping often dismissed by critics as a toothless talkshop, could signal a big upgrading in ties with Southeast Asian and a new tactic by the new U.S. administration in exerting influence over Myanmar.

She also announced the U.S. Peace Corps would resume volunteer work in Indonesia. The programme was booted out under former president Sukarno during the turbulent 1960s.

Clinton came to Indonesia from Japan as part of a four-country Asian tour that also takes in South Korea and China.

Some hardline Islamic groups and students opposing Clinton's visit held rallies. But this leg of her Asian tour is expected to go smoothly given good government-to-government relations and Indonesian pride in the fact that Obama had lived in Jakarta.

Playing on Obama's Indonesian ties, about 50 schoolchildren from the U.S. president's old school, waving U.S. and Indonesian flags, sang traditional Indonesian folk songs as Clinton walked across the tarmac at an airport in the suburbs of Jakarta.

While most Indonesian Muslims are moderate, the country has a small, radical fringe.

About 100 Muslim students, some chanting "Allahu Akbar" (God is greatest), held a rally at Jakarta's presidential palace, some throwing shoes at a picture of Clinton.

Police have deployed 2,800 officers in the capital for Clinton's visit.

President Susilo Bambang Yudhoyono, seeking a second term this year, is keen to showcase Indonesia's stability since its transformation from an autocracy under former President Suharto -- who was forced to resign in 1998 -- to a vibrant democracy.

The United States is Indonesia's second-biggest export destination, but Jakarta is concerned over a slide in exports of commodities such as palm oil, rubber and nickel to developed economies, as well as curbs on textile and shoe exports.

Indonesia also wants a bigger role in world affairs, notably in the Middle East, given its core position in ASEAN, its population of 226 million, and its location straddling key trade routes.

(Additional reporting by Sunanda Creagh, Olivia Rondonuwu and Telly Nathalia)

(Writing by Ed Davies; Editing by Bill Tarrant)