Indonesia, Australia leaders hold make-up talks

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Photo - Australian Prime Minister Tony Abbott, second from left,  talks with Indonesian President Susilo Bambang Yudhoyono during their meeting in Batam, Indonesia, Wednesday, June 4, 2014. The leaders of Indonesia and Australia met Wednesday for the first time since relations between the countries were damaged over spying allegations. (AP Photo/Tundra Laksamana)
Australian Prime Minister Tony Abbott, second from left, talks with Indonesian President Susilo Bambang Yudhoyono during their meeting in Batam, Indonesia, Wednesday, June 4, 2014. The leaders of Indonesia and Australia met Wednesday for the first time since relations between the countries were damaged over spying allegations. (AP Photo/Tundra Laksamana)
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JAKARTA, Indonesia (AP) — The leaders of Indonesia and Australia said Wednesday the two countries' sometimes stormy ties were on the mend following their first meeting since a damaging row last year over spying allegations and people smuggling.

Good bilateral relations are important for the neighboring countries, but historical, cultural and political sensitivities have often meant periods of volatility. Australia is viewed with suspicion by some nationalists in Jakarta, who have not forgotten its role in sending troops to East Timor in 1999 when that territory broke away from Jakarta.

Indonesian President Susilo Bambang Yudhoyono, who is leaving office in July after eight years, briefly hosted Prime Minister Tony Abbott on the island of Batam as the Australian leader was heading to Europe.

In November, Indonesia downgraded relations with Canberra over reported Australian phone-tapping of Yudhoyono, his wife and eight Indonesian ministers and officials in 2009. The row, which coincided with Abbott becoming prime minister, enflamed tensions over another longstanding issue between the two countries — the passage of asylum seekers from South Asia and the Middle East via Indonesia to Australia.

In recent weeks, ties appeared to be warming, and the Indonesian ambassador, Nadjib Riphat Kesoema, returned to Canberra in May.

While the talks Wednesday didn't come up with anything explicit, it was clear both leaders were looking to the future.

"Yes, there have been a couple of issues between our countries over the last few months, but I am confident that they are well on the way to resolution," said Abbott. "A satisfactory and successful resolution."

Abbott, who has implemented a tough policy of turning back boats to Indonesia carrying asylum seekers, said "the people smuggling issue is well on the way to resolution because the boats that were coming to Australia have almost entirely ceased to come, so I believe that this is an issue which will not substantially further trouble us."

Yudhoyono said both sides were working to resolve the issues and "want to always be good friends."

Indonesian Foreign Minister Marty Natalegawa also said the people smuggling issue "will not trouble us anymore."

The allegations of phone tapping sparked a nationalist backlash in Indonesia even as they can't have come as a surprise to many in the government there.

Indonesia has been demanding a "code of conduct" on intelligence issues before full ties can resume.

Natalegawa said the code would be agreed to soon with a "very easy and simple principle. There will be no more phone-tapping by governments of each other."

The spying allegations came from documents leaked by former U.S. National Security Agency operative Edward Snowden.

The breakdown in relations was the most serious since 1999, when Australia led a U.N. military force into the former Indonesian province of East Timor following a bloody independence ballot.

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