Dorodjatun confirms RI ready to end IMF program<\/p>\n
Fabiola Desy Unidjaja and Fitri Wulandari, The Jakarta Post,
\nJakarta<\/p>\n
Coordinating Minister for the Economy Dorodjatun Kuntjoro-Jakti
\nconfirmed on Monday that the government was ready to end the
\nexisting International Monetary Fund economic bailout program.<\/p>\n
He said that looking at the positive developments in a number
\nof key economic indicators, he was convinced that the economy
\nwould be able to survive the post IMF period.<\/p>\n
\"The Indonesian government has the right to end the program
\nwith the IMF as mandated by the People's Consultative Assembly
\n(MPR),\" Dorodjatun told reporters after a meeting with Vice
\nPresident Hamzah Haz and a special government team assigned to
\nevaluate exit strategy options from the current IMF program.<\/p>\n
\"The government has prepared strategies for the future not
\nonly for the 2004 state budget, but also a mid-term strategy,\" he
\nadded.<\/p>\n
Dorodjatun's statement came only a few days after Vice
\nPresident Hamzah Haz stressed the government's determination to
\nend the five-year IMF program. This was the first official
\nstatement on the issue.<\/p>\n
Since the MPR issued a decree suggesting that the government
\nnot extend the current IMF program when it expires later this
\nyear, there has been hot public debate on whether the government
\nshould end the program or extend it for another short period
\ngiven the financial consequences of the first alternative to the
\nstate budget and the economy.<\/p>\n
Some analysts have said that without the presence of the IMF
\nin designing and monitoring the country's economic reform
\nprogram, Indonesia would no longer be able to obtain debt
\nrescheduling facilities from both the Paris Club of creditor
\nnations and the London Club of private creditors. Next year
\nalone, the country must repay some $3 billion in debts to the
\nforeign creditors. This would create a serious fiscal gap and
\nthus affect the performance of the overall economy.<\/p>\n
But Dorodjatun said that the government was now more confident
\nabout parting with the IMF amid several positive indicators in
\nthe economy.<\/p>\n
He pointed out on the significant increase in foreign exchange
\nreserves now standing at around $33 billion; and the relatively
\nstable exchange rate of the rupiah against the U.S. dollar.<\/p>\n
He added that the country's small and medium-sized enterprises
\nwould also receive a total of Rp 42 trillion in loans from the
\ncentral bank, much higher than Rp 30 trillion allocated for last
\nyear. This should help push economic growth.<\/p>\n
\"The government is safeguarding the economic momentum and
\npositive record so that economic growth will continue to be
\npositive and better ahead of the 2004 general election,\"
\nDorodjatun said.<\/p>\n
Minister of Finance Boediono acknowledged that exiting from
\nthe IMF program would cause a fiscal gap, saying that his office
\nand the central bank were still calculating the cost to the state
\nbudget.<\/p>\n
\"There will be financial gap, and Bank Indonesia is
\ncalculating it to make a projection and preparations,\" Boediono
\nsaid.<\/p>\n
Neither Dorodjatun nor Boediono, however, would say whether
\nthe country would still invite the IMF to play a monitoring role
\nor would completely break away from the Fund.<\/p>\n
IMF presence for the last five year has been important to
\nmaintain international creditors and investors.<\/p>\n
Economists have urged that Indonesia join the IMF post-program
\nmonitoring arrangement. Under the arrangement, the Fund will
\nmonitor the government's self-designed economic reform program
\nand not design it as it does at present.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/dorodjatun-confirms-ri-ready-to-end-imf-program-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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