IMF may release aid next month<\/p>\n
JAKARTA (JP): The International Monetary Fund (IMF) is
\nexpected to disburse its second US$1 billion tranche to Indonesia
\nin the second or third week of June, a former economics minister
\nsaid yesterday.<\/p>\n
\"If there aren't any significant changes, they (IMF) will
\ndisburse the funds,\" said Arifin Siregar, former minister of
\ntrade and central bank governor, following a meeting with IMF
\nAsia-Pacific director Hubert Neiss, in which several other
\nmembers of Soeharto's economic architectural team of the 1970s
\nalso attended.<\/p>\n
Arifin explained that the IMF's board of directors would make
\nthe decision two weeks after they received a report review, which
\nis to be prepared by Neiss based on his four-day fact-finding
\nmission in the wake of the country's political turmoil, which led
\nto the resignation of Soeharto and the rise of his protege B.J.
\nHabibie.<\/p>\n
Neiss, who met with the country's frail new government,
\nopposition leaders and senior economists, is to leave Jakarta
\ntomorrow after holding a press conference.<\/p>\n
Indonesia was initially scheduled to receive $1 billion in
\nfunding on June 4, but payment was postponed due to the political
\nturmoil.<\/p>\n
The IMF earlier extended $3 billion from its total commitment
\nof $10 billion to support the country's sweeping economic reform
\nwhich was designed to help lift the country from its worst
\neconomic crisis in decades.<\/p>\n
\"There are several signs that the bailout money will be
\ndisbursed,\" Arifin said, but added that it was only his personal
\nview.<\/p>\n
He said the IMF funding would be crucial to the disbursement
\nof the funds committed by other bilateral and multilateral
\ninstitutions as well as donor countries.<\/p>\n
Former oil and mining minister Subroto quoted Neiss as saying
\nduring the meeting that there were several positive aspects on
\nthe economic and political fronts, mentioning the new economic
\nministerial team which is considered competent, Habibie's move to
\nset free political prisoners, and plans to create a free press
\nand open political environment.<\/p>\n
\"The plans must be implemented, because it is the key to
\ndisbursement,\" he said.<\/p>\n
But Muchtar Pakpahan, a political dissident recently pardoned
\nand released from jail, asked the IMF to postpone the funding
\nuntil a definite political reform agenda had been set out by the
\ngovernment.<\/p>\n
\"I'm afraid that the funds will only go to corrupt men within
\nthe government,\" he told reporters yesterday after meeting with
\nNeiss.<\/p>\n
He added, however, that funding for humanitarian purposes
\nshould be continued, as the economic hardships of the majority of
\nthe population had worsened due to skyrocketing prices of basic
\ncommodities and rising unemployment following the political
\nturmoil and prolonged monetary crisis.<\/p>\n
Subsidies<\/p>\n
Separately, Coordinating Minister for Economy, Finance and
\nIndustry Ginandjar Kartasasmita said the IMF had given Indonesia
\nthe green light to continue its subsidies on essential food items
\namid the worsening economic situation.<\/p>\n
\"We'll continue the subsidies if necessary. They (IMF) have
\nagreed with us,\" he told journalists after a meeting with Neiss
\nin the afternoon. Several economics ministers were also present
\nat the meeting.<\/p>\n
Under the April agreement with the IMF, subsidies for most
\nessential food items including sugar, flour, soybean and cooking
\noil were to be abolished by Oct. 1.<\/p>\n
\"We'll continue the subsidies until the economic situation
\nimproves,\" Ginandjar said.<\/p>\n
He, however, stressed that subsidies for goods used for
\nindustrial purposes would soon be eliminated, and urged the
\nindustries to import their own needs.<\/p>\n
\"The government will only import food commodities of quality
\nfor household consumption,\" he said.<\/p>\n
Both Arifin and Subroto stressed the importance of the
\nsubsidies.<\/p>\n
Arifin said the elimination of certain subsidies amid the
\nworsening economic situation would only worsen the economic
\nhardships of low-income people.<\/p>\n
He explained that the continuation of subsidies would mean a
\nrevision in the financially strained state budget.<\/p>\n
Meanwhile, a group of people under the Committee for National
\nDefense in Surabaya, the country's second largest city, protested
\nagainst the United States for its role in trying to delay the IMF
\nfunding.<\/p>\n
They visited the American Consulate General's office with
\nposters saying \"IMF Now or Never\", \"Do Not Interfere with
\nIndonesian Politics\". (rei\/imn\/26)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/imf-may-release-aid-next-month-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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