Interview on RCTI TV with Yulia Supadmo

QUESTION: Secretary Rice, first question I would like to ask, there is a perception here from some people that your main agenda here in Indonesia this time is to secure, to make sure that the Cepu oil block in the border of Central and East Java does not fall into the hands of U.S. competitors, meaning that it remains in the hands of energy company ExxonMobil. How do you respond to that?

SECRETARY RICE: Well, this is a private matter. The United States isn't involved in the investment decisions of its companies. The deal is done. It was done before I arrived and I think it shows that Indonesia is open for private investment and that it's an investment climate in which people are investing. But our primary -- my primary goal for being here is to talk about the tremendous partnership that Indonesia and the United States are developing, about Indonesia's extraordinary march to democracy, about the -- a place that I think we feel very comfortable because like Indonesia, the United States is a place of great diversity, cultural, religious, ethnic. And so that's why I'm here and it's been for me an extraordinary trip.

QUESTION: But isn't it true that one of the main pillars of U.S. foreign policy is to secure energy resources from abroad, meaning to ensure that demand for oil in the United States, which continues to grow and I quote a National Energy Policy Development Group report which states that by 2020, you expect U.S. dependence on oil to reach some 66 percent. Doesn't that conclude for some people that you do need to secure those foreign oil resources?

SECRETARY RICE: Well, we can't really secure foreign oil resources. It's not how energy markets work. It is a market and people will sell their oil in the market and mark the -- oil will get a certain price, depending on supply and demand. And I think it's really not -- it's not possible and it's a way that sometimes even other countries think about it -- we'll secure that market and we'll secure that market.

QUESTION: The fact that so many U.S. oil companies now operate in Indonesia and really control really major reserves.

SECRETARY RICE: Well, Indonesia has had American and other investments for quite a long time and the purpose is to make Indonesian oil fields capable of producing oil, which then benefits Indonesia, but also benefits the global market. Foreign investment in oil is simply for the purpose of getting the best technology, getting the best production out of those fields, because all of the world needs energy resources, not just the United States, but Indonesia, China, India. These are all countries that are growing economically and you need energy resources.

In fact, the President has -- President Bush has made clear that the United States believes that our great task is to actually diversify our energy supply and that is why the United States is spending under the President's new energy plan, resources to try and improve the capability of bio diversity -- of bio energy through ethanol and through the use of grasses to produce bio fuels. We are looking at nuclear energy as a way to diversify our energy supply. So yes, we need oil as everyone needs oil. But we also are diversifying our energy supply. And you -- I just want to repeat, you cannot control an energy supply. Energy is a world market and the price is set by supply and demand.

QUESTION: Okay. Now moving on to the issue of Palestine, you canceled your previously scheduled visit to Indonesia when Prime Minister Sharon was ill. Do you think that sends a message to Indonesians that when it comes to shove and push, the U.S. will ultimately side with Israel when it comes to interest between Palestine and Israel?

SECRETARY RICE: Well, in fact, I was unable to come here. I'm here now. And I've been here and enjoyed my visit very much. But sometimes friends need to understand that there are other demands and this time, at that time, the demand was that there were concerns about the Middle East. I've been very actively involved in trying to help to create a two-state solution -- something that President Bush believes very strongly in. In order to do that, we need to work with the Palestinians, we need to work with Israelis. And I think everybody wants the United States to be active in the Middle East peace process. And sometimes when there are problems in the Middle East, it demands the attention of the American Secretary of State and I think people understand that.

QUESTION: In your meeting with Foreign Minister Hassan Wirayuda yesterday there as a proposal that Indonesians and mainly other Muslim countries have asked that whether the United States would be more willing to receive Hamas as the ruling government in Palestine, if it were to act more realistically. How have you responded to calls like that?

SECRETARY RICE: Well, the situation with Hamas is as follows. Hamas was elected in an election for which we congratulated the Palestinian people. But Hamas now needs to make a strategic choice and it's not just the demand of the United States, this is -- these are requirements that were set by the Quartet. The Quartet being the guardian of the roadmap, the United States, the EU, the UN and Russia that you can't have a peace process if one party does not accept the right of the other party to exist. You can't have a peace process if one party is not committed to peace and continues to use violence. And so our appeal would be to any Palestinian government that they would accept those responsibilities of governing.

Everyone knows that for the United States Hamas has been declared a terrorist organization, as it has for the European Union. But were Hamas to make a strategic choice and renounce violence and recognize the right of Israel to exist. I think the responsibility to govern would be easier and they would find an international community ready to support a Palestinian government, so devoted to peace.

QUESTION: Secretary Rice, considering so-called radical Islamic movement in Indonesia, which you would obviously consider as a threat to U.S. interests, as well as Indonesian maybe, how far would the U.S. go in neutralizing these elements that are anti-American in Indonesia?

SECRETARY RICE: Well, let me start with -- to whom they're a threat. They are a threat to all of us. But Indonesians have felt that threat most directly in the bombings in Bali and bombings in Jakarta. Indonesians, Muslims around the world have died just as have other innocent people because of this particular extremist element that is determined, we believe, to subvert the peaceful purposes and the peaceful doctrines of Islam. So how far will we go to stop them? I think we all have to be united in making certain that these terrorists cannot take innocent life. But the way that we do that is through cooperation with governments around the world that also want to fight terrorism which is why the United States has such a strong counterterrorism program and such strong counterterrorism work with the Government of Indonesia.

QUESTION: Secretary, one last a question. We understand or I have heard that you are quite a fitness enthusiast.

SECRETARY RICE: (Laughter.)

QUESTION: Have you manage to keep that up on your whirlwind world tour?

SECRETARY RICE: I try and keep up my fitness routine wherever I go. I worked out this morning. And it's really important to my physical health and my mental health, that as an athlete and as a kid and as a teenager. And I've never been able to exist very long without exercise.

QUESTION: Thank you very much, Secretary.

SECRETARY RICE: Thank you very much.

2006/T8-6