In October 2002, Islamic radicals set off two powerful bombs on the Indonesian island of Bali. Detonated in the heart of the tourist district, they obliterated several bars and nightclubs, killing over 200 people—visiting Australians, Americans, and other foreign nationals, as well as Indonesians—and wounding still more. It was the worst terrorist attack in the country’s history. Shocked and taken aback by the carnage, the international media proclaimed the end of innocence for the tropical retreat.

To anyone who had been paying attention to political developments in Southeast Asia over the previous decade, however, the surprise was misplaced. Well before the Bali bombing, Islamists had turned the region as a whole into a front in their global jihad. In the Philippines, the radical group Abu Sayyaf, which received funding from the brother-in-law of Osama bin Laden, had built itself into a powerfully lethal force. In Indonesia, an even deadlier terror group, Jemaah Islamiah (JI), had also expanded, bombing churches and ultimately putting in motion the Bali plot.

But even after 9/11 and the Bali bombing, the governments of Southeast Asia did little to combat Islamism. Indonesia’s then-vice president, Hamzah Haz, actually celebrated the 9/11 attacks, announcing his hope that the deaths of 3,000 people in the World Trade Center would help “cleanse America of its sins.” The country’s president, Megawati Sukarnoputri, barely responded to the carnage in Bali. In the Philippines, Thailand, and Malaysia, governments similarly dithered, failing publicly to condemn or even to recognize the growing threat posed by Islamist groups and the political parties that spoke for them.

Today, less than five years after the attack on Bali, the situation in Southeast Asia has changed dramatically. Across the region, jihadist groups like Abu Sayyaf and Jemaah Islamiah are struggling to survive, Islamist parties seem to be weakening, and the region’s newest leaders openly wage war on terror. Moreover, the United States has played a leading role in these successes, and it has done so without creating much in the way of an anti-American reaction. Indeed, Southeast Asia is proving to be a model for the “long war” against Islamist terror. The lessons of its recent progress deserve to be studied closely.

Veterans of the anti-Soviet jihad in Afghanistan founded Abu Sayyaf in the impoverished southern Philippines in the early 1990’s. With the help of militants imported from the Middle East, the group grew quickly in that Muslim-majority region, operating in areas that featured minimal law enforcement and a historical hatred of the Christian-dominated national government in Manila. In the course of the decade, its numbers expanded from a few hundred fighters to as many as 5,000.

Abu Sayyaf announced its new strength in acts of escalating brutality. In 2001, after a string of kidnappings, including the taking of three Americans hostage, the group killed one of its captives with a machete. “We have released Guillermo Sobero,” an Abu Sayyaf leader proclaimed by radio. “But we have released him without his head.” In 2004, the Islamists followed up by bombing a Philippine ferry, killing over 100 people in the worst terror attack in the country’s history.

During its early years, members of Abu Sayyaf escaped the Philippine military by retreating to the interior of the southern island of Jolo or by using small boats to dart into coves and inlets impassable by larger ships. Worse, elements in the corrupt, underpaid Philippine military reportedly sold weapons to Abu Sayyaf and took bribes from the group. In June 2001, when the army surrounded its leaders in a tiny southern town, deploying tanks, helicopters, and troops around a small hospital where they were bunkered, the terrorists somehow walked out the back door of the compound, slipped through the massive cordon, and escaped to safety. Filipino journalists who watched the episode allege that Abu Sayyaf paid off the military to let them flee.

The Philippine government proved as inept as the army. Manila failed to pursue a coherent policy, instead alternating between announced crackdowns in the south and attempts to negotiate deals. Although the U.S. dispatched a small group of advisers to the southern Philippines after 9/11, the central government remained wary of openly embracing the global war on terror. Its fear, in part, was that the American presence, in this former colony with a history of tense relations, would catalyze its political opposition.

In Indonesia, the situation five years ago seemed even grimmer. In the late 1990’s, Jemaah Islamiah had taken advantage of the country’s political turbulence and economic meltdown to build terror cells and promote radical Islam across the archipelago. Indonesians historically had favored a tolerant, Sufi-influenced version of Islam—Christians and Hindus worshipped openly, Jakarta’s restaurants served beer with their fiery curries, and few Muslim women wore head-to-toe coverings. But JI and other Islamists began to strike out at these local traditions. Funded partly by supporters in the Persian Gulf—one prominent Saudi charity employed a top JI leader as its Indonesian representative—they began to set up networks of boarding schools across the country to attract young men away from the underfunded public system. JI’s charismatic intellectual leader, Abu Bakar Bashir, traveled throughout Indonesia preaching jihad and helping to establish schools. Other radicals formed new Islamist political parties and attempted in some communities to establish shari’a law.

With a growing pool of potential recruits, JI expanded and started mounting increasingly sophisticated terror operations. On Christmas eve in 2000, the group orchestrated the bombing of over 30 churches, killing eighteen people. The attack in Bali two years later, the region’s first suicide bombing, introduced the jihadist tactics of the Middle East. In 2003, JI struck at the heart of Indonesian power, bombing a Marriott hotel in the Jakarta neighborhood that is home to the country’s most important banks, oil companies, and other economic players. Soon after, militants bombed the Australian embassy.

Even after these audacious attacks, the government of President Megawati Sukarnoputri vacillated. Indonesian officials refused to admit that their nation was threatened by extremists, and Jakarta declined much of the counterterrorism cooperation offered by Washington. Megawati also refused to appoint a counterterrrorism czar. As for the Indonesian armed forces, they proved to be as corrupt as their Philippine counterparts. Having run the country under Suharto, whose 30-year dictatorship ended in 1998, the military resented civilian control. In an effort to foster chaos and thus to undermine democratic rule, some army units reportedly gave support to Islamist groups in the archipelago’s remote central islands.

Under these permissive circumstances, it is hardly a wonder that JI and other Islamists saw a chance to extend their reach. In the early 2000’s, militants from across Southeast Asia held a series of informal summits at which they declared that their ultimate goal was to establish a pan-Islamic state. In the wake of these meetings, JI reportedly assisted in attacks on hotels in southern Thailand, where a local Islamist movement that had withered in the 1980’s was re-emerging. The conflict soon exploded into a full-fledged war against local officials, police, soldiers, teachers, and Buddhist monks; between 2004 and 2006, nearly 2,000 Thais were killed.

The regional trend was, in short, unmistakable. A study by the Rand Corporation found that the number of terrorist attacks in Southeast Asia and Oceania had grown from 95 in the period 1968-1985 to over 2,000 between 1986 and 2004. And no less obvious was the regional failure to deal with the threat. In contrast to the Islamists, the governments of Southeast Asia remained narrowly national in their anti-terrorism measures—such as they were. Their efforts at collecting intelligence were not coordinated, and they only reluctantly shared information across borders. U.S. officials privately complained that when Thai authorities needed to pass on tips about terror groups to neighboring Malaysia, they called not Kuala Lumpur but the American embassy in Bangkok, forcing the Americans to play the role of go-between.

Perhaps the most serious consequence of this lack of information-sharing was the opportunity it gave the Islamists to exploit the region’s financial institutions. In 2003, the U.S. Treasury Department estimated that more than 300 individuals and groups in Southeast Asia were engaged in funding al Qaeda and its affiliates.

And yet it is undeniably the case that, by the beginning of this year, Abu Sayyaf, Jemaah Islamiah, and their terrorist allies could no longer feel so confident about their prospects. What happened in the interim?

This past January, on the southern Philippine island of Jolo, special-forces units of the national army hiked into the thickly forested interior. Relying on intelligence from advisers provided by U.S. special forces and on tips from locals, the soldiers surrounded leaders of Abu Sayyaf and proceeded to blast their mountain hideouts. By the end of the month, nearly all of the group’s commanders had been killed. Ships from the Philippine navy also surrounded Jolo, preventing survivors from escaping in their motorboats. At nearly the same time, Philippine security forces raided Abu Sayyaf’s bomb-making facilities and training grounds across the archipelago, turning up plastic explosives and homemade bombs. Although some of the group’s militants remain at large, they are now scattered across the Philippines and without leadership.

In neighboring Indonesia and Malaysia, security forces have made similar gains. In late 2005, after years of tracking the top members of Jemaah Islamiah, members of an elite Indonesian police unit stormed a small house in the Javanese city of Malang. Inside were three key JI bombmakers, including a mastermind of the deadly attacks in Bali and at the Marriott in Jakarta. The terrorists blew themselves up to avoid capture, but the authorities had inflicted a crushing blow. According to Sidney Jones, an expert on JI at the International Crisis Group, Jemaah Islamiah “no longer constitutes a threat to the stability of Indonesia.”

These victories capped an aggressive counterterrorism campaign waged over the past two years by the governments of the region with the active support of the United States. Susilo Bambang Yudhoyono, who was elected president of Indonesia in 2004, agreed early on that his country faced a serious threat and needed help. With assistance from Malaysia, Australia, and the Philippines, his government tracked the Bali bombers and other JI members. Indonesian police captured over 200 suspected terrorists, and their counterparts in Malaysia have made key follow-up arrests. Overall, according to longtime Southeast Asia diplomat Matt Daley, Indonesia has displayed “an impressive performance.”

Cooperation has proceeded on several fronts. Regional governments have formalized their commitment to counterterrorism—and to working with the U.S. on the problem—through the Association of Southeast Asian Nations (ASEAN) and by creating a joint counterterrorism center located in Malaysia. Many ASEAN members also have tightened their laws on money laundering, a key source of terrorist finance. The Philippines has been particularly successful in this regard, and last year was removed from the developed nations’ list of “problem” financial centers.

No less important, Southeast Asian nations have begun to mount an open challenge to Islamist schools and political parties. In Indonesia, a country whose size makes it the region’s natural leader, President Yudhoyono has proved to be a strong voice for secularism and clean government, thus weakening the appeal of Muslim radicals. In order to emphasize the seriousness of the threat, his government has televised the videos of local suicide bombers and has recruited top Muslim clerics to issue public messages against the Islamists. Jakarta has even employed former terrorists to preach that violence has no place in Islam.

Several factors combined to produce this turnaround. In the first place, the Islamists themselves overplayed their hand. The wanton destruction of the Bali bombing, which not only killed dozens of locals but also ruined the fabled island’s tourist economy, turned many Indonesians against JI. Abu Sayyaf’s brutality had a similar effect in the Philippines.

In its own way, the December 2004 tsunami also helped the counterterrorism fight. Among the tens of thousands of Indonesians killed by the tidal wave were fighters of Gerakan Aceh Medeka (GAM), an Islamic insurgency in the province of Aceh, the part of the country hit hardest by the disaster. Forced from its hideouts, the leadership of GAM proved willing to enter a truce with the Indonesian government. Yudhoyono reciprocated, establishing peace talks that have resulted in elections in Aceh.

As for the American side of the equation, rapid U.S. assistance after the tsunami, delivered by the U.S. military, transformed many Indonesians’ views. A recent poll conducted by the group Terror Free Tomorrow found favorable opinions toward the U.S. increasing in Indonesia, one of the few places in the world where this has occurred.

Direct military assistance also has been crucial. Here the U.S. has chosen wisely to play a behind-the-scenes role, dispatching advisers, communications technology, and weaponry rather than taking the point position itself. In the Philippine military’s operation against Abu Sayyaf this past winter, American tracking equipment was key, and U.S. advisers also helped the Philippine navy keep Abu Sayyaf blockaded on the island of Jolo. When it came time to announce the victory, the U.S. (and Australia, which also assisted) maintained a low profile, allowing President Gloria Macapagal-Arroyo to take the credit. In the eyes of the Filipino public, then, the campaign against Abu Sayyaf has remained a Filipino operation.

In Indonesia, the U.S. helped to create a new 300-man elite counterterrorism force called Detachment 88, spending over $20 million on its training and equipment. It proved to be a good investment. Detachment 88 played a major role in dismantling JI’s leadership and helped lead the investigations of the Bali and Marriott bombings. In addition, the U.S. has persuaded the Southeast Asian nations to work together more closely, so that Americans no longer have to serve as the primary conduit for shared intelligence.

Beyond helping to track and kill terrorists, Washington has promoted economic development in the region and has tried to assist in settling local conflicts that very often have taken on an Islamic cast. In the southern Philippines, the U.S. has built new classrooms, medical clinics, roads, wells, and other social-welfare projects, spending over $250 million in aid since 2001. With Washington’s encouragement, Manila negotiated a peace deal with the Moro Islamic Liberation Front, the largest insurgent group in the southern Philippines but one that had demonstrated a willingness to renounce terrorism and turn against Abu Sayyaf. Many locals now relay information about Abu Sayyaf to the government. Much the same has happened in Indonesia, where informers have become more cooperative in helping the authorities identify JI’s hideouts.

The progress in Southeast Asia can be exaggerated, of course. No one is predicting complete victory over the Islamists soon. Southern Thailand in particular remains a hub of radicalism, and the situation there seems to be escalating from intermittent terrorist attacks to all-out warfare between radical groups and the Thai military. Elsewhere, even with greater transnational cooperation, the region’s thousands of islands make it easy for terrorists to conceal themselves and to raise funds. JI has been wounded, but it remains dangerous, having balkanized into cells that probably do not communicate with each other and thus are more difficult to track.

Still, there are important lessons to draw from this relative success story. What the U.S. and its allies have done in the region might well be replicated elsewhere, not only in a deeply problematic country like Pakistan but also in the Muslim Middle East—at least in those countries where the regime itself is not the major threat.

For one thing, in Southeast Asia the U.S. moved quickly to help local forces stand on their own; from the start, the struggle against Islamism was a genuinely collaborative effort. Moreover, American forces have eschewed the kind of inflammatory rhetoric that could allow Islamist terrorists to cast their fight as a struggle against a foreign crusader. Southeast Asian politicians have been able to avoid charges of becoming American stooges.

Could a leader like Pervez Musharraf, who has allowed al Qaeda and the Taliban to gain a sanctuary in northwestern Pakistan, be persuaded to cooperate more fully with Washington? Obviously, the threat that Musharraf faces is more lethal and comprehensive than the one in Southeast Asia, but there is reason to think that, with quiet support and encouragement, he might take a more active role in undermining the Islamists. If, for instance, the Pakistani government were to make a point of regularly screening footage of native-born suicide bombers, emphasizing the numbers of fellow Muslims they have killed, the impact on public opinion might resemble that in Southeast Asia. Something similar happened in Jordan where a 2005 attack on a hotel in Amman, which destroyed a Jordanian wedding party, helped turn public attitudes against radical Islamists.

As for direct assistance in fighting the terrorists, the lesson of recent experience in Southeast Asia is to rely less on military establishments—which, as in Iraq, have proved to be unreliable and often corrupt—than on specially trained forces, cordoned off from ordinary soldiers. Some elite units similar to Detachment 88 in Indonesia have already been created in Iraq and Afghanistan, and more should follow. Not only are they uniquely capable of familiarizing themselves with and exploiting local conditions, but their successes raise the morale of the armed forces as a whole.

Equally important, Southeast Asia’s elite units and police forces have won their victories through dogged investigative work, not by resorting to brutal interrogation techniques. In Indonesia, the Yudhoyono government has expanded its fight against terror while at the same instituting democratic reforms, establishing national human-rights bodies, and generally creating a more open, accountable government. With few reported incidents of abuse or torture, counterterrorism efforts in Southeast Asia continue to have a high standing in public opinion. By contrast, the much more coercive tactics of, for example, the Mubarak government in Egypt have tarnished the war on terror and made it easier for Islamists to stir up rage against the U.S. and its Middle Eastern allies.

Transparent and well-managed development initiatives, like American aid in the southern Philippines, have also helped to ensure ongoing public support. Better oversight and management of such projects, including especially in Iraq, is critical if they are to win friends in fighting the Islamists.

For all of its glaring differences with the struggle in the Middle East, the less-studied “second front” against Islamism, in Southeast Asia, shows that even short-term gains may be enough to silence those who claim that the fight is essentially unwinnable. The dramatic reversal that has taken place in the region in a few short years offers some hope that the dire conflicts in Afghanistan and Iraq might yet be turned around. Five years ago, it should be remembered, Indonesia refused even to admit it had a terror problem. Today, Indonesians recognize that the war on terror is their war too, and willingly spill their own blood in prosecuting it.