Sydney – The United States is encouraging Indonesia's military to exercise restraint as the embattled Asian country copes with financial meltdown and social unrest, Defense Secretary William Cohen said Thursday.

"We are working with them as best we can, certainly at the economic level and financial level, but also maintaining some military-to-military contacts to encourage the military to exercise the kind of restraint that is going to be necessary in these times of stress," he said.

Cohen was interviewed along with Secretary of State Madeleine Albright on the Australian Broadcasting Corporation "Lateline" television show. The two US officials are in Sydney for two days of annual talks with their Australian counterparts. Cohen will then head for talks with government officials in Indonesia Friday, while Albright returns to Washington.

Cohen said that General Wiranto, commander of the Indonesia's armed forces (ABRI), and "others" – whom he did not specify – have exercised restraint so far. "But it is something that we feel very strongly about, that strong consideration has to be given for the protection of human rights and to make sure there is no abuse of military power against the Indonesian people," he said. So far, Cohen added, "it seems to be a democratic process underway," with new elections scheduled for next spring.

Albright, in the same interview, said 100 million – half the population – was now living in poverty in Indonesia. Food distribution is a great problem "and we don't want unrest to come as a result of the lack of food," she said.

US President Bill Clinton has directed that 1.5 million tons of food be delivered to Indonesia, including 500,000 tons now and the other million in segments so as not to upset commodity markets, which is of concern to Australia, Albright said.

Cohen said the important thing was to "get the economics right first (in Indonesia) so that you can have a stable social environment." "If the economy starts to come back and people feel secure that they are going to be well fed and have an opportunity for prosperity in the future, that will tend to stabilize the situation," he said.

Then, "investors will feel comfortable in coming back to a country that has rule of law and not the law of rule, that has an open transparent type of investment opportunity," Cohen said.