IMF confident latest plan will work<\/p>\n
WASHINGTON (Reuters): International Monetary Fund chief Michel
\nCamdessus said on Tuesday he was confident the latest rescue
\npackage for Indonesia would work and rejected criticism of the
\nIMF's approach to Jakarta's problems.<\/p>\n
Indonesia agreed with the IMF on Friday to a 117-point reform
\npackage in return for a bail-out package of $43 billion to end
\nthe country's worst economic crisis in three decades.<\/p>\n
The agreement, the third in six months, has been generally
\nwelcomed, but analysts have said the key would be its
\nimplementation, especially since Jakarta was seen as backsliding
\non the first two IMF pacts.<\/p>\n
Critics have said President Soeharto dithered on
\nimplementation because some of the reforms would dismantle
\nlucrative monopolies controlled by his family and associates.<\/p>\n
\"I am confident that this will work,\" Camdessus told a news
\nconference.<\/p>\n
Despite the reluctance of what he called \"vested interests\" to
\nembark on reforms like those prescribed by the IMF, Camdessus
\nsaid one of the main reasons for his assurance was that
\nIndonesian authorities had learned the high cost of rejecting the
\nIMF's advice.<\/p>\n
\"They know pretty well the cost of not accepting and adhering
\nto it earlier,\" Camdessus said.<\/p>\n
\"The cost for the country has been tremendous. Each time we
\nhad to come back to the program, we had to strengthen it. This
\ntime we have an excellent program,\" he said.<\/p>\n
Camdessus, speaking at a news conference ahead of the IMF's
\nspring meeting in Washington, said the program agreed to last
\nweek would address Indonesia's fundamental economic problems.<\/p>\n
The new program finds \"solutions that preserve the long-term
\nobjectives, while taking due consideration of the immediate
\nsocial costs of the measures,\" he said.<\/p>\n
Camdessus dismissed criticism that the IMF had not properly
\naddressed the mix of problems in Indonesia and he defended the
\nIMF's multi-pronged approach.<\/p>\n
\"We had no choice but to address simultaneously the major
\nmacro-deficiencies of this economy and its major deficiencies
\nboth in the banking and the structural domain,\" he said.<\/p>\n
\"It would have been nonsense to have the illusion that by
\nsolving the macro imbalances, you would have Indonesia on a long
\ntrack of sustainable growth.\"<\/p>\n
In its latest plan, the government promised a new anti-
\nmonopoly law, moves to set up a bankruptcy law and a special
\nbankruptcy court and regulations for winding up companies,
\nmergers and acquisitions.<\/p>\n
It also promised transparent and competitive bidding for
\npublic infrastructure contracts, ministerial statements and
\nnewspaper ads to explain official decisions, and procedures to
\ndeal with public complaints.<\/p>\n
A concrete plan for privatization of state enterprises and
\nfaster restructuring of the banking sector were also detailed.<\/p>",
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