Indonesian presidential candidate says Jerusalem move no problem

Prabowo's comments are significant because he is Joko's direct opponent in the April 2019 election and they signal that he is less likely to use the embassy move as a political wedge against the President.

They do not, however, preclude him from campaigning against the Indonesia-Australia Economic Partnership Agreement (IA-CEPA), or free trade deal, agreed by Canberra and Jakarta.

Joko and his Foreign Minister Retno Marsudi have been critical of the embassy move proposal and stressed their opposition to it both publicly and privately to Prime Minister Scott Morrison and other senior members of the Australian government.

Retno has linked a delay in signing the free trade deal to the proposal and according to leaked WhatsApp messages she sent to Foreign Minister Marise Payne, described the decision to review the location of the embassy as a slap in Indonesia's face.

Last week,  politician Dian Islamiati Fatwa -  a parliamentary candidate for Prabowo's Gerindra (Greater Indonesia) party - predicted a negative reaction in Indonesia if the embassy move went ahead.

But speaking at the Indonesia Economic Forum at the Shangri-La hotel in Jakarta on Wednesday, Prabowo struck a more conciliatory tone.

"I don’t see it [the embassy move] becomes a problem for Indonesia," he said.

"Regarding the moving of the embassy, I haven’t read about Australia's [final] decision on moving its embassy to Jerusalem. As Palestine’s supporter, we of course have our own opinion. But Australia is also an independent and sovereign state so we must respect their sovereignty."

Mr Morrison has said a final decision on whether to move the embassy is due by the end of the year.

There have even been suggestions that Indonesia has sought a guarantee from Australia the embassy move will not go ahead before signing the free trade deal.

Lowy Institute non-resident fellow Matthew Busch told Fairfax Media he was "not terribly surprised" by Prabowo's comments.

"I think both this time around and last time around [when he ran for president in 2014] Prabowo, from a foreign policy perspective, has made it very clear that although he has strong opinions on Indonesian sovereignty, when it comes to foreign policy he takes a much more moderate line and is not too exercised about how other states carry out foreign policy," he said.

"People hear his anti-foreign investment and protectionist rhetoric and think that applies to his views on other countries' foreign policy, but I don’t think that’s quite right."

However, Busch said that the candidate could still campaign against the free trade agreement, even if he left the embassy issue alone.

"He could say he has no problem with the move - but what he does have a problem with is that Australia got such a good deal. What is not off the table [in the election campaign] is criticism of the FTA itself."