Australia, Indonesia agree to bury spy row

SYDNEY – Australia and Indonesia have agreed a pact to put a damaging spy row behind them, paving the way for the resumption of full defence cooperation, Foreign Minister Julie Bishop said on Tuesday.

Ties between the neighbours sank to their lowest point in years in November after reports Australian spies tried to tap the phones of President Susilo Bambang Yudhoyono and his inner circle. Jakarta recalled its ambassador from Canberra and suspended cooperation in several areas over the incident, including efforts to stop people-smuggling boats reaching Australia.

Yudhoyono called for a code of conduct to govern behaviour during talks with Australian Prime Minister Tony Abbott in June, and the agreement reportedly includes a promise from Canberra never to use its intelligence agencies to harm its neighbour. "We have reached agreement on the joint understanding and we are currently arranging a time to sign it," Bishop said on Tuesday.

The deal would be signed in Indonesia by Foreign Minister Marty Natalegawa, with outgoing president Yudhoyono a witness, her office said. Bishop told Fairfax Media the agreement was a "concise statement of our commitment to respect each other's sovereignty and not to harm each others interests".

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