FATF list removal helps economy<\/p>\n
Leony Aurora, The Jakarta Post, Jakarta<\/p>\n
The central bank is optimistic that the removal of Indonesia from
\nthe list of non-cooperative countries in the fight against money
\nlaundering will encourage foreign banks to extend loans to
\nbusinesses here and, eventually, boost the volume of financial
\nand trade transactions.<\/p>\n
Several countries have already started to relax their
\nrequirements for lending to Indonesia, Bank Indonesia governor
\nBurhanuddin Abdullah said on Monday during a hearing with the
\nHouse of Representatives' finance commission.<\/p>\n
"Hong Kong has lowered its provision requirement from 60
\npercent to 10 percent while the Netherlands has lowered it from
\n80 percent to 50 percent," said Burhanuddin.<\/p>\n
"I have heard that they are going to lower it even further."<\/p>\n
A lending provision is money must be set aside by a bank
\nlender to cover the risk of default.<\/p>\n
The higher the risk, the higher the provision.<\/p>\n
"This is proof that our efforts to make the cost of doing
\nbusiness in Indonesia lower are bearing fruit," said Burhanuddin.<\/p>\n
After years of pleas, the global money laundering watchdog --
\nthe Financial Action Task Force -- removed Indonesia from its Non
\nCooperative Countries and Territories (NCCT) list last week.<\/p>\n
It is expected that in the long run this will improve
\ninternational confidence in Indonesia, which has long been
\nconsidered a safe haven for money launderers, especially with
\nopen corruption flourishing in all walks of life. Being excluded
\nfrom the blacklist would also boost the country's chances of a
\nratings upgrade from the global ratings agencies.<\/p>\n
The removal of Indonesia -- along with the Cook Islands and
\nthe Philippines -- leaves Myanmar, Nauru and Nigeria as the only
\ncountries still left on the list.<\/p>\n
As part of its efforts to be removed from the list, the
\ngovernment passed the Anti-Money Laundering Law in 2003 and
\nestablished the Financial Transaction and Report Analysis Center
\n(PPATK), which is tasked with auditing the country's financial
\ninstitutions.<\/p>\n
To date, however, not one money launderer has been prosecuted
\nunder the Anti-Money Laundering Law.<\/p>",
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"sponsor": "Okusi Associates",
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