Indonesian business leaders and analysts have warned that cutting diplomatic ties with the US could disrupt the economic recovery programme beyond repair, bankrupting at least half of the country's factories, and losing millions of jobs.

A chairman of the Indonesian Chamber of Commerce and Industry, Iman Taufik, said that although the US was "not right" to attack Afghanistan in search of Osama bin Laden, severing diplomatic ties with the US as a result would be disastrous for Indonesia. He pointed out that anti-American reactions had already caused losses to various industries.

The US is the largest market for Indonesian exports. Bustanul Arifin, a director of Indef, an economic think tank, said a call to boycott US products will harm Indonesia more than it will the United States. He said that many textile buyers in the United States have already turned to countries such as Taiwan, given their failing confidence in Indonesia's ability to meet delivery times.

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