House expects revised central bank law soon<\/p>\n
JAKARTA (JP): The House of Representatives expects to finalize
\namendments to the central bank law during their next sitting,
\nwhich will run from mid-August to November, a legislator said on
\nTuesday.<\/p>\n
Muhaimin Iskandar of the National Awakening Party (PKB)
\nfaction said that legislators planned to resume the debate on the
\ngovernment-proposed changes to the central bank law next month
\nafter the House's recess.<\/p>\n
\"There are a lot of things that need to be discussed but
\neverything has to be finalized during the next sitting,\" Muhaimin
\nsaid after chairing a meeting of the House's consultative body,
\nwhich, among other things, discussed the schedule for the debate
\non the central bank law.<\/p>\n
The government was earlier pessimistic that the new central
\nbank law would likely be enacted before December.<\/p>\n
The government said in a draft of the letter of intent on
\nreform measures addressed to the International Monetary Fund
\n(IMF) that the planned amendments to the central bank law
\nrequired further discussion with legislators and the fund.<\/p>\n
\"The government of Indonesia, in consultation with the House
\nhas decided that more time is needed -- at least six months -- to
\nstudy the options for revising the law,\" the government said in
\nthe draft dated July 11.<\/p>\n
But Muhaimin asserted that the amendments to the central bank
\nlaw must be completed by the conclusion of the next sitting.<\/p>\n
He gave no reason why a deadline was necessary.<\/p>\n
Legislators will go into a one-month recess on July 23,
\nduring which they will prepare for the People's Consultative
\nAssembly's special session slated for Aug. 1.<\/p>\n
Plans to amend the central bank law first surfaced last
\nNovember amid a demand from President Abdurrahman Wahid to
\nreshuffle Bank Indonesia's board of governors.<\/p>\n
The President argued that the reshuffle would rid the central
\nbank of its corrupt practices of the past. He has repeatedly
\nstated his intention to remove Bank Indonesia Governor Sjahril
\nSabirin.<\/p>\n
Sjahril, however, defied the President's demand, and has
\nrefused to resign.<\/p>\n
The row between the two subsequently led to the arrest of
\nSjahril early this year on charges that he was involved in the
\nBank Bali financial scandal in 1999. But Sjahril persisted on
\nholding onto his position at Bank Indonesia.<\/p>\n
Both legislators and the government expect to complete the
\namendments to the central bank law in December or early this
\nyear.<\/p>\n
But due to pressure from the IMF, they postponed the revision
\nto an as of yet unspecified date.<\/p>\n
The IMF has been opposed to several clauses in the proposed
\namendments, especially those on firing the entire board of
\ngovernors, arguing that they would compromise the hard-won
\nindependence of Bank Indonesia.<\/p>\n
Observers have suspected that the government used the planned
\namendments mainly as a way of removing the legal barrier that has
\nbeen preventing the reshuffle of Bank Indonesia's board of
\ngovernors.<\/p>\n
According to the central bank law, a member of the bank's
\nboard of governors cannot be replaced unless he or she has been
\nproven to have committed a crime, has been incapacitated or
\nvoluntarily resigns.<\/p>\n
The government later agreed to include the recommendations
\nfrom an IMF-appointed panel of experts in the proposed central
\nbank law changes.<\/p>\n
\"We must listen to what the IMF has to say, but the House
\ndoesn't consider the IMF to be a big deal,\" Muhaimin continued.<\/p>\n
He said the government and the House had yet to agree on
\nseveral articles in the proposed revision of the law.<\/p>\n
\"We have disagreements on a number of articles, including
\nArticle 75,\" Muhaimin said of the article which guarantees the
\nindependence of Bank Indonesia governors. (bkm)<\/p>",
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